Topic: What do you think about borrowing against your bitcoin? - page 4. (Read 539 times)

They're selling out something that you might be at regret if ever you'll try it out. Why would you borrow your own bitcoin if you're the own holding it? with the idea, you're going to put it as a collateral and will take the cash. You're just adding burden to yourself.

Taking profits is essential for everyone and you can do it at any time that you want and at any price that bitcoin will have. You can sell in batches just as the example you've given and put aside a quantity of bitcoin that you'll hold until it reaches $100k or $1M.

Borrowing against anything is a Risk.
When you think about borrowing against your Bitcoins it becomes a lot worse. Here are my following assumptions:

1. Let us say that you borrowed when the price of the Bitcoins were x , the company seized a part of your Bitcoins as a safe keep now suddenly you wake up and see that the price is 3x. Would you call them and ask for it back ? Would they give it back ? No
Some companies do not require seizing the asset but what IF ! The company itself blocks you from selling those Bitcoins since you borrowed against then in the first place.

If I do own Bitcoins I would never let anyone take a hold of them in the first place!! They are yours , even if the hold is just the legal name listed in the contracts for debt.

2. The pre-qualification if taking the loan would be amazingly weird, high, unacceptable since you would take loan from a centralized body. Would you accept it ? It is indeed a very complicated thing when you consider Bitcoins. I woke trade them , maybe hold them but would not borrow against them , just my personal opinion because I do consider my Bitcoins to be **Money** and **investment** both which is far too valuable than fiat.

Well, the point is there is a calculation when to borrow, but I will not do it for any reason. plus the interest per month will burden us. automatically pay 2x the loan amount, won't this be stressful for us. to avoid borrowing and believe that bitcoin will touch $ 1 million. gradually it will happen.

Well, if I had Bitcoin, and if I believed that Bitcoin will one day reach $1 million, I would never take loan against it wither, because whatever small the interest of loan be, is actually my loss, when I can simply avoid that by just holding my Bitcoin and crypto assets instead of giving it to another lender or lending business then take fiat and then use fiat for use and repay back the loan. Secondly, if I would be borrowing fiat against my crypto, obviously I would must be having some source of income to pay off that debt with interest so that I can have my whole crypto back, so why wouldn't I just use that fiat income to meet my needs and let my crypto hibernate as I hold!?!

Giving bitcoin as collateral to get the fiat money doesn't look like a great idea, you are expecting it to grow meanwhile you are paying your interest but what if the price of BTC gets crashed? Lender will ask for more BTC for sure or they will never accept it as valid collateral to get finance. First of all understand that if you are going to pay interest rates then it will be too hard to see any returns so saving money is the only smart choice whether it is fiat or bitcoin.

It's really won't be easy if the person you are using Bitcoin as collateral is nimble with Bitcoin, the loaner would require the bitcoin of that amount as same as when you want to repay it, let's say it's 0.05BTC then if Bitcoin increase in dollars that's an increase in the collateral because you would repay same 0.05BTC and the value is different from when agreement, this is also a Gamble but who ever does this is a believes the future is Bitcoin because Bitcoin can also reduce in value.

I do not think this is a good idea either and I'm pretty neither of those guys you listed out are financial advisors of any kind, and have tons of money and so it's pretty easy for them to say things like that.  The truth is there is no guarantee of anything.. how do we know bitcoin won't go in to a major crash and bear market territory for the next year or two? We don't.  Yes personally I believe at minimum we are going to see a 100k bitcoin in the somewhat near future, but I think gambling like that, potentially wasting your money ..not for me. 

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.

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.