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/biz/ - Business & Finance

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28948823 No.28948823 [Reply] [Original]

What's stopping me from depositing my link on aave, borrowing more link and depositing the borrowed link and repeating it over and over again? It's literally free money right

>> No.28948977

same

>> No.28949078

>>28948823

Nothing as long as LINK continues to climb. On a substantive dip you’ll get raped.

>> No.28949101

Except don't borrow link but borrow stablecoins and buy link with them you fucking idiot

>> No.28949343

>>28949101
Why borrow stablecoins instead?

>> No.28949430

>>28948823
It's not 1:1, right? I thought you could only take a loan for like 10% of your collateral.

>> No.28949871

Why not just use leverage on exchanges?

>> No.28949978

>>28949343
They won’t fluctuate.

>> No.28950136

So what happens in these cases when the LP gets pulled?

>> No.28951531
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28951531

>>28949978
Makes sense. So deposit linkies on AAVE, borrow stablecoin, send stablecoin to binance, buy more linkies, deposit those linkies and repeat. What could go wrong here?

>> No.28951609

>>28951531
good luck take a look at stablecoin rates right now.

>> No.28951801

>>28951609
Hmm I did not take that into account. What about Celsius? They offer very low rates

>> No.28951870

>>28951609
Wouldnt a high interest rate be an indicator that a lot of people are using leverage, and if they were to leverage like OP, then they would all be liquidatet, and since the exchanges probably want to stay market neutral they would sell their received collateral and force markets even further down