No different then taking a loan against your BTC from some of the larger places that do it online.
The biggest issue I see is regulation and price volatility and the rules that you are agreeing to when you do it.
You give them 1BTC they give you $25000. If the price goes up can you get more cash from them? Or do they give you some back.
If the price plummets back to $15000 and you walk away do they have any way of going after you?
Personally I would not, but that is just me. Would rather just sell and buy back. Unless they are offering very low interest rates, which pawn shops are not known for.
-Dave
You seem to have forgotten how pawnshops work. In return for collateral in the bitcoin you get money. Here and now. The current exchange rate is taken into account. And here is the volatility and the price of bitcoin with a reduction in price and a fall? I assume that upon repurchase, you will be returned the amount that was indicated in the contract. You gave them 1BTC and they gave you back 1BTC. What other interpretations can there be? This is not a way to mortgage btc for $10k and then get $20k. Pawnshops give you the opportunity to borrow quick money (but not cheap) when you really need it.The biggest issue I see is regulation and price volatility and the rules that you are agreeing to when you do it.
You give them 1BTC they give you $25000. If the price goes up can you get more cash from them? Or do they give you some back.
If the price plummets back to $15000 and you walk away do they have any way of going after you?
Personally I would not, but that is just me. Would rather just sell and buy back. Unless they are offering very low interest rates, which pawn shops are not known for.
-Dave
For me, every service in which someone gives its BTC for this or that reason is essentially wrong. Most of those who are active on the forum know what happened to companies that offered tempting interest on BTC deposits, and yet they were companies that operated at least somewhat in accordance with the law - while on the other hand, a pawn shop can literally disappear overnight and you can easily lose everything.
Of course, there is also the issue of KYC and the protection of this data, but also the problem of personal safety if it were physical branches - which leads me to conclude only one conclusion, and that is that this is a very bad idea no matter how someone presents it.
How will you lose everything? The pawnshop gives you the money in return for the pledged bitcoin. In case of unforeseen circumstances, you still have money on hand received from the pawnshop. As a last resort, this can be considered a forced sale under the most unfavorable scenario.Of course, there is also the issue of KYC and the protection of this data, but also the problem of personal safety if it were physical branches - which leads me to conclude only one conclusion, and that is that this is a very bad idea no matter how someone presents it.
It's not that pawnshops are good or bad, but that the real, physical world is gradually and increasingly integrating digital currencies. Even in such a dubious way for users.
Everyone is waiting for an bitcoin adaption, and when this happens, I agree, in a very peculiar way, they begin to grumble. Completely forgetting that this event is, in fact, the acceptance of btc as a financial asset, on par with gold in a certain niche. Try to look at the news from a different angle.
