Borrowing is not really bad because at a point borrowing really solve some certain issues now, borrowing above your income can be seen as a wrong altitudes from my views but I don't really know for others because here in community their is a particular board for lending which involves cryptocurrency especially bitcoin, so basically you borrow and be paying gradually with a Bitcoin, but that should not be above you monthly or weekly Bitcoin achieved.
Really? You can say that to the people that are drowning in debt and can't pay. Borrowing anything means that you will do anything to pay it back and there are a lot of things someone can do because they want to pay back what they borrowed. I do agree that you have a certain point where you are allowed to borrow but don't you think that it will be practiced in real scenario, most people who are in debt typically spiral out of control and borrow more money than they can pay back. 
Topic: What do you think about borrowing against your bitcoin? - page 3. (Read 539 times)
Borrowing is not really bad because at a point borrowing really solve some certain issues now, borrowing above your income can be seen as a wrong altitudes from my views but I don't really know for others because here in community their is a particular board for lending which involves cryptocurrency especially bitcoin, so basically you borrow and be paying gradually with a Bitcoin, but that should not be above you monthly or weekly Bitcoin achieved.
I've been hearing the idea that selling your Bitcoin to take (some) profits is stupid. That it would be better to borrow against it and let it keep growing. I heard this from Saylor a Max Keiser. If you really believe that Bitcoin is going to keep growing, that it's going to reach $1M or more, why are you going to sell it at $50k?
The idea would be to borrow using the Bitcoin as collateral, and refinance as the price continues to rise. That way you don't sell your Bitcoin and you don't pay taxes, income tax or capital gains.It should be done with a low debt ratio, which will allow you to weather a bear market storm for a couple of years.
I do not see it clearly, I understand that in general the best you can do is to avoid debt and increase your net worth, and you can only sell partially when the price reaches certain milestones. For example, you sell 25% when the price reaches $100k, another 25% when it reaches $250k, and so on.
That's a good idea I hope one company will take that idea or an institution that is government funded or regulated will take that idea, so we can avoid selling our Bitcoin when we badly need fiat, many investors are doing and it's recommended to avoid crash on the market, selling a portion like 5 to 10% will not hurt the market and your profit in the future.
Borrowing just to increase your Bitcoin holdings is fine, just make sure that you have enough money to pay for that debt or else you’ll ended up selling your Bitcoin just to pay for it. I also don’t like to borrow money and I just buy bitcoin with my extra money so I don’t need to force myself rushing into this market, its better for me to always play slow that to rush myself from owning Bitcoins.
I guess that is not a good practice, borrowing money and your collateral is your bitcoin, right?
Instead of having profit while you are holding your bitcoin, it will be lost because to pay the interest of your debt or you missed the bull trend that supposed to be you are cutting your profit at that time. Just to avoid having debt, this will not help, I guess it may consider with the small amount but the comment above was right, the debt will still remain debt and you need to pay this with full interest.
Instead of having profit while you are holding your bitcoin, it will be lost because to pay the interest of your debt or you missed the bull trend that supposed to be you are cutting your profit at that time. Just to avoid having debt, this will not help, I guess it may consider with the small amount but the comment above was right, the debt will still remain debt and you need to pay this with full interest.
I also do not encourage this idea, I hate the idea of borrowing in general, so I will never think of taking bitcoin in the form of debt, do not forget that you must return the debt that you took in addition to the interest owed on this amount, so it does not seem like a good idea to me I prefer to buy Direct and investment rather than borrowing.
I agree i am against in any debt especially with bitcoin I rather missed out any opportunity to buy it rather than taking a debt or borrowing just to buy and go with the flow. Remember a debt is a debt it will continue to grow because of the interests, I would do another job for me to create money and not to rely with anyone, having a debt for me is a big burden, yes bitcoin may pump and bitcoin may dump in an. instant as well, there's no assurance so do not take debt. I would rather prefer that one rather than on getting stressed just because you do have something to repay in due time.Its better to be debt-free than to have that kind of problem.
You wont even know if those loaned money or borrowed amount will really be gaining up knowing that investment in bitcoin doesnt really guarantee profit anytime.
If you do have other source of fund to patch up to pay your loans then its up to you but depending on the profit to repay then better not to proceed at all.
I also do not encourage this idea, I hate the idea of borrowing in general, so I will never think of taking bitcoin in the form of debt, do not forget that you must return the debt that you took in addition to the interest owed on this amount, so it does not seem like a good idea to me I prefer to buy Direct and investment rather than borrowing.
I agree i am against in any debt especially with bitcoin I rather missed out any opportunity to buy it rather than taking a debt or borrowing just to buy and go with the flow. Remember a debt is a debt it will continue to grow because of the interests, I would do another job for me to create money and not to rely with anyone, having a debt for me is a big burden, yes bitcoin may pump and bitcoin may dump in an. instant as well, there's no assurance so do not take debt. 
Debt is the worst thing you can do to make yourself financially stable, consider debt as your last resort for anything, debt comes with many things beside the money that comes with it, the favor that you need to do because you are indebted is one of them. Borrowing money to grow it is the most crazy thing because instead of getting the full benefits, there are people that you need to pay some part of what you reaped because you need to payback what you owe and sometimes with interest. Debt only works if you have a company and your company is doing well to make the borrowed money make more money so that when you pay it back, you won't have any problem financially.
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I do not like debt.
I think a lot of the financial problems the world is dragging down come in large part from debt. The over-indebtedness of people, of states, of companies. Money is created as debt. At first it was mortgages and personal loans, then credit cards, but today you can finance practically everything.
I've been hearing the idea that selling your Bitcoin to take (some) profits is stupid. That it would be better to borrow against it and let it keep growing. I heard this from Saylor a Max Keiser. If you really believe that Bitcoin is going to keep growing, that it's going to reach $1M or more, why are you going to sell it at $50k?
The idea would be to borrow using the Bitcoin as collateral, and refinance as the price continues to rise. That way you don't sell your Bitcoin and you don't pay taxes, income tax or capital gains.It should be done with a low debt ratio, which will allow you to weather a bear market storm for a couple of years.
I do not see it clearly, I understand that in general the best you can do is to avoid debt and increase your net worth, and you can only sell partially when the price reaches certain milestones. For example, you sell 25% when the price reaches $100k, another 25% when it reaches $250k, and so on.
I don't like the idea they propose either, because if it were to become generalized, bitcoin would be encouraging the very thing it proposes to flee from: bitcoin is an alternative to money as debt and encouraging massive indebtedness by taking bitcoin as collateral seems paradoxical, to say the least.
I'd like to know what you think about it.
I think a lot of the financial problems the world is dragging down come in large part from debt. The over-indebtedness of people, of states, of companies. Money is created as debt. At first it was mortgages and personal loans, then credit cards, but today you can finance practically everything.
I've been hearing the idea that selling your Bitcoin to take (some) profits is stupid. That it would be better to borrow against it and let it keep growing. I heard this from Saylor a Max Keiser. If you really believe that Bitcoin is going to keep growing, that it's going to reach $1M or more, why are you going to sell it at $50k?
The idea would be to borrow using the Bitcoin as collateral, and refinance as the price continues to rise. That way you don't sell your Bitcoin and you don't pay taxes, income tax or capital gains.It should be done with a low debt ratio, which will allow you to weather a bear market storm for a couple of years.
I do not see it clearly, I understand that in general the best you can do is to avoid debt and increase your net worth, and you can only sell partially when the price reaches certain milestones. For example, you sell 25% when the price reaches $100k, another 25% when it reaches $250k, and so on.
I don't like the idea they propose either, because if it were to become generalized, bitcoin would be encouraging the very thing it proposes to flee from: bitcoin is an alternative to money as debt and encouraging massive indebtedness by taking bitcoin as collateral seems paradoxical, to say the least.
I'd like to know what you think about it.
I am sure we have our own way to increase the bitcoin amount that we have. But borrowing money just for buying bitcoin will not be recommended, especially if you do not have another income source to pay that loan. Even if you have other income, you should think about your monthly expenses before deciding to borrow money.
I suggest you sell your bitcoin at a high price and buy back again when it is down, so you can increase the bitcoin amount you have while you can take profit from selling your bitcoin.
I do not like to borrow money, even for my daily needs, because that can make me in trouble.
If you've got a bunch of bitcoin but need a loan, something's wrong there. Situations like that make me think the person over-invested in bitcoin and didn't keep enough of a cash reserve on hand.
Well it's not that they have so little cash that they can't even buy groceries. I think in general consider they cash as junk that constantly loses value and that the less you have the better. But yes, they have little cash.
In my case I think it's okay to have a certain amount of cash for the short term. It is true that it is deflationary and that the speed of money printing has accelerated in the last year, but we are still far from hyperinflation like in Venezuela or the Weimar Republic.
Another point to consider here is that I think everyone in the thread has spoken out against getting into debt, but it is very common for large companies or very wealthy people to do so, even when they could pay in cash. See for example Mark Zuckerberg:
"Even billionaires like Zuckerberg have mortgages. Zuckerberg refinanced his $5.95 million Palo Alto, California, estate in 2012 into a 30-year adjustable rate mortgage at an interest rate of just 1.05%. Zuckerberg can clearly afford to just pay cash for any property he wants."
Source: "Why Get a Mortgage if You Can Pay Cash?"
In this case, the reason is twofold: tax reasons and the fact that inflation is above 1%, so borrowing at 1% is making you money, but as we said before that implies risk.
I think this only makes sense to do if your wealth is much higher than the loan you are borrowing, so the risk is very low. If things go bad, there is a downturn in the market, etc. you can pay off the debt without any problems, and I would apply the same to borrowing with Bitcoin.
I guess most of us here agree that debt are traps that are just burdens in our backs lest we use it into something that will create more money. Personally, I think borrowing is acceptable only if you have a plan to repay it, and you use the money into something that will generate more money (and one that has low risk, and is mostly guaranteed to succeed). If you are to borrow fiat and use bitcoin as a collateral, that's one of the most stupidest call given bitcoin's volatility. Unless it's clearly defined in the terms that the price of the collateral at the time of the deal remains constant no matter what happens, perhaps I will think about it, but if not, then it's a no for me.
Also what Max Keiser and Michael Saylor are stating is trying to game the volatility of bitcoin in your favor. Most businessmen tend to think like this: maximizing the usefulness of a certain asset on their favor. I go against this, especially since it promotes debt even if bitcoin is poised for fruitful gains in the coming years. There's just too much risk still.
Also what Max Keiser and Michael Saylor are stating is trying to game the volatility of bitcoin in your favor. Most businessmen tend to think like this: maximizing the usefulness of a certain asset on their favor. I go against this, especially since it promotes debt even if bitcoin is poised for fruitful gains in the coming years. There's just too much risk still.
I also do not encourage this idea, I hate the idea of borrowing in general, so I will never think of taking bitcoin in the form of debt, do not forget that you must return the debt that you took in addition to the interest owed on this amount, so it does not seem like a good idea to me I prefer to buy Direct and investment rather than borrowing.
Likewise, I think people should move away from debts - not head for it. I find the idea of using Bitcoin as collateral very risky, also, I can't imagine what kind of organization would accept it. What if Bitcoin keeps dropping and there'll be no end to it? Anything can happen, and then what?
If these kinds of practices become popular it might lead to a serious crisis! It's bad enough that people take loans not exactly knowing how and when will they return their debt, and we all remember how the mortgage system overuse ended...
But if there were debts with collateral as volatile as Bitcoin - it would be a disaster.
If these kinds of practices become popular it might lead to a serious crisis! It's bad enough that people take loans not exactly knowing how and when will they return their debt, and we all remember how the mortgage system overuse ended...
But if there were debts with collateral as volatile as Bitcoin - it would be a disaster.
A lot of people used to use credit cards as their margin account, and that back fired for many users..this is the same principle.
Yeah, but credit cards tend to have outrageously high interest rates. If you could use bitcoin as collateral for a bank loan, you could probably get a much better rate--but finding a bank (or any other lending institution) willing to accept crypto as collateral might be a problem. And imagine that the bitcoin collateral you put up for the loan suddenly drops 25-50%. You're probably going to have to put up more collateral, much like a margin call. And seeing as bitcoin is one of the most volatile investments in existence, a drop like that certainly could happen--and quick, too.
If you've got a bunch of bitcoin but need a loan, something's wrong there. Situations like that make me think the person over-invested in bitcoin and didn't keep enough of a cash reserve on hand. I'm sure that's happening a lot lately, given how high bitcoin has climbed.
Borrowing against anything is a Risk.
I'm glad that so far the posts agree with what I think. Debt involves risk, and we don't know for sure what will happen in the future. Even if we are very clear that Bitcoin has a promising future, that in the long term it will go up a lot etc., the best thing to do is not to get into debt and if necessary sell small portions or other strategies to avoid debt.
Borrowing definitely is not a good idea at all. However, with regard to bitcoin, we have to change our minds. As long as you understand your money management and the risk involved, I believe we have the capability to earn more money from loans by using bitcoin as collateral.
There is another way to enhance your profit: leverage. Many exchanges offer leverage as a tool for us to have better profits. An x2 leverage can give you a really big amount of money.
Still, each person can have their own opinion on this issue. Lets ones choose himself the best way for his profit
There is another way to enhance your profit: leverage. Many exchanges offer leverage as a tool for us to have better profits. An x2 leverage can give you a really big amount of money.
Still, each person can have their own opinion on this issue. Lets ones choose himself the best way for his profit
I've been hearing the idea that selling your Bitcoin to take (some) profits is stupid.
If they are calling people "stupid" by shorting or participating in a short of Bitcoin then you can count me as one of the stupid people in the market right now. Unlike your idea on increasing your debt just to add more position on Bitcoin I think shorting or just simply taking advantage of the price drop when you have your exit plan is more efficient and is a good way of maximizing the capital you already own. Selling your position when it is falling down or is about to fall down is the best way to take profit and at the same time buy it back again at a discounted price.The idea would be to borrow using the Bitcoin as collateral, and refinance as the price continues to rise. That way you don't sell your Bitcoin and you don't pay taxes, income tax or capital gains.It should be done with a low debt ratio, which will allow you to weather a bear market storm for a couple of years.
This will work if you are looking at Bitcoin in the long-run but I don't know how exactly this loan will workout for you since you will definitely have a given period on when you need to pay it out and that is what you need to take in mind. Compared to observing the market and taking advantage of the price drops this for me is more riskier as not only you have a pressure coming from the market but also you have the pressure from your debt.
Personally I don't like this idea, but maybe someone can still agree with you. I wouldn't use bitcoin as collateral to ask for a loan from a platform or someone in fiat just because I didn't want to sell it. I prefer to manage my bitcoin on my own without giving anyone control over the asset I own. Placing it as collateral may be very risky given the market fluctuation non-stop over time. Ok, if the price can still go up 2-3 times, but what if the price goes down 2-3 times ? With a different price from before, of course, this is a loss that must be accepted by the borrower.
What if BTC goes to zero? There is no grantee it will not be worth zero. There can be hidden infatuation and everyone got afraid there are more and they stop believe in Bitcoin. Bitcoin can have a fundamental unsolvable flaw and some other coin takes his place. There are many other catastrophic scenarios. Chance for Bitcoin to go to zero is not zero. But it is something and you have to hedge against that chance. Dr. Kim made a good video about it. Prospect Theory: https://youtu.be/REC5V7d3pqM?t=2165 About how we see this small chance as non existent same as the high chance as sure. And that can be a fatal mistake.
If you're the kind of person that willing to face the possible risk, then you're good to go on that strategy of having fiat and borrowing fiat against your Bitcoin. It depends on me about the situation, if I probably badly need the money and didn't have a choice, it might I will grab the opportunity while I have collateral.
This seems like gambling, either you will gain profit when upon borrowing or it will have bigger losses because the more days you didn't pay the interest and the more interest rate might the more chances that the interest payments will increase. If interest rates went up by 3% or 5%, could you still afford the repayments?
But mostly it will end up selling my Bitcoin if I have badly needed money even though what will happen the price and I think, it isn't a good idea to take a loan against your Bitcoin.
This seems like gambling, either you will gain profit when upon borrowing or it will have bigger losses because the more days you didn't pay the interest and the more interest rate might the more chances that the interest payments will increase. If interest rates went up by 3% or 5%, could you still afford the repayments?
But mostly it will end up selling my Bitcoin if I have badly needed money even though what will happen the price and I think, it isn't a good idea to take a loan against your Bitcoin.
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