Hi BTT famz, is it a good idea to borrow against your crypto assets?
Question 1;
Why would you borrow against your crypto assets?
By borrowing against your crypto assets, you are basically handing over your assets to a third-party custodian or a centralized lender as collateral. You are putting your assets to more danger of getting mismanaged or stolen.
Is there anyone practising this right now? What are the risks involved in doing this? Is Defi borrow and lending the best way to go because I know some are centralised.
You wanna know about the dangers?
Read more about what happened in the:
1. Luna crash saga
2. Three Arrows Capital saga
3. Celsius network saga
4. Voyager Digital saga
5. FTX- Alameda Research saga
To mention but a few, all this happened in 2022,
The answer is right under your nose.
I don't like the idea myself but since few new projects are using this idea as utility then I am guessing that many investors are patronising them, I can across a new project called HIFI Finance on coinmarketcap and I am doubting why such projects keep pumping up after so many damages that they have done to investors..
My curiosity was maybe there is more to the whole thing than I knew, this is why I asked this question, I thought 🤔 I was missing out on something, thanks for your reply.