Yeah, that's a big issue nowadays, our society doesn't understand debt and how to use it, and people are actually taught that debt is bad and to never go into debt... Which is the worse mistake a person can do if they want to grow, because with debt you can grow a lot quicker, you just need to know how to use it. And people don't understand that the way money is created is through debt... thus, money is debt...
it's unfortunate that the interest rates have increased so much that it's a lot harder to use debt now, I only got a job 1 year ago, before that I couldn't use it, so I got the worse of it.
I've used crypto debt though, because it has much cheaper rates than real debt. Basically used ThorSwap to get a loan collaterized by ETH to buy a coin $BCB right before it rocketed in price, paid the debt and made $8k profit (give or take).
That's smart. I played the same playbook but I am terrible at trading. I have been using MATIC collateral to invest a loan into HBD for that 20% return. Not great but not terrible either.
That's a smart and safe bet, but since I was pretty sure the bull market was starting this year, I wanted to go for a non stablecoin, maybe in the future, when the bear market returns I'll do the same as you are doing...
Assuming the HBD rates don't drop... Might even be a good idea to use a normal loan. 🤔
I have been doing this for more than a year now with HBD. I was REKT by Anchor protocol when I leveraged normal debt for that 20% return. It still hurts - a little :P
Well, with HBD I think the main concern is that the witnesses don't keep the protocol debt in check and limited, if they don't, they could cause an implosion of both HBD and HIVE.
They've been doing a good job so far, especially when compared with a protocol like Steem which has a bunch of SBD vs Steem which might very well cause it to implode in the future.
@edicted knows more about the protocol debt metrics then I do and I know he made some good posts about it in the past which you should ready if you haven't.
He is probably one of the best people to follow and ask about the stability of HBD and HBD savings rate.
I never liked AnchorProtocol, smelled like bad ponzinomics ready to blow, which it did...
ThorSwap loans have similar mechanism, but at least the people "in charge" have limited it and know of the risks.
With Erik Vorhees from shapeshifting telling me himself that it is limited, which I can assume means they understand the risk:
Great insights on Throswap. I have followed Erik from his centralized days. Never looked into Thorswap loan though. I find it a bit complex to navigate. I have a Rune-BTC pair experiment that I am holding since the last bull market.
With HBD, I do not have enough $$ to too much worry about the situation. I have read @edicted's posts but I do not fully understand the risk of the loan system yet. I am giving extra benefit of doubt to HBD just because I spend my time here in the ecosystem. But f Ups are f Ups and can happen anywhere.
Anchor fren!
