Bitcoin Forum

Hello. I see different platform like nexo, blockifi, etc... that can borrow you crypto or stablecoin. I'm here to ask if you have a strategy for example you borrow btc with an interest rate of 6% and then you use it on defi with 8% APR. Thanks for helpful. 8) 8)

That would be a really really bad idea. Not because these platforms say that they provide x% APR on certain assets, it doesn't mean that the number wouldn't change. And not to mention that APR isn't the only thing you need to take into consideration, as you need to take into consideration the asset price as well. And especially if we're talking about Ethereum ERC20 tokens here, chances are they will be swinging up and down A LOT more than BTC.

an asset last year may have rose by 8% but that does not mean it will do so every year

also. you might end up buying in at the assets 8% ATH and then it drops

meaning invest $1000.. it drops by 6% meaning at year end you get $940
but your bank wants $1060
yep you lost out on 10% having to pay $100 from your own income

Guys he is not talking about buying/selling anything. He is talking about borrowing at lower interest and put to defi at higher interest. There is no buy/sell here. Price of asset does not matter here. He is not exposed to currency risk here.

For example borrowing USDT and USDC and than put them both into USDT/USDC liquidity pool.

1- you are exposed to defi smart contract failures, defi smart contract scams (it is possible).
2- you are exposed to impermanent loss with liquidity pools. Even with 2 stable coins. When one of them is failing (for example bifinex is bankrupting and USDT is going down) you are ok because you just need to give them back. Same amount. You dont care about their value but if they were locked in defi (d.e liquidity pool) you are loosing both usdc and usdt thanks to impermanent loss. So you will not be able to give back same amount of USDT and USDC
3- you are exposed to interest changes (both in defi and lending)
4- you are exposed to various risk that comes with defi you chose (simply how they use your deposit)
5- most likely you have to have collateral. Most likely twice as much as you want to borrow (or something like that). Maybe its better to simply put that on defi?

Good call...

except for the fact that you have to repay the principal and interest, plus you'd probably have to pay tax on the interest earned which would probably leave you with ½ a percent.

If you plan on walking away with $10,000 you'd probably have to loan ($2,000,000 X 4 = $8,000,000 ) - no bank is going to loan that kind of money without collateral (and they'd be unlikely to loan for a volatile commodity such as Bitcoin)

If you feel confident then you can do that but what about your back up plan, what if the market crashes and how you will be recovering. We can have these risky trades during a bull run but you need to think about the risk factor as well as you cannot predict what the market situation will be in a weeks time. I am yet to venture fully in this market as i have my doubts on how long these bubble will last.

It doesn't always work that way though, lots of swings in altcoin market, much riskier so I wouldn't go that route.

There's much better way to make money here, of course this whole borrowing has taken the altcoin market, but sooner or later that APR will change because of so many factors and at the end there is a possibility that you might end up losing.

Be careful on the decision you're going to make here, there's no certain outcome if you're going to choose erc20 token contract to buy now. Much better if you're getting btc loans, then invest and hold using btc or eth coin. The potential gains is bigger if compared with altcoins investment due to lesser fluctuations.

For me its always a no of taking such a huge risk for hardly any return with this volatile coins. Also, nothing is fixed and in this crypto space it does not take time before things chances in an hour time. So better to invest directly with your own money and rest assured you can hold it even during the falling markets and when it bounce back you can make profits on it.

Not a good idea. I have known that feature but didn't tried it even one time because it is too risky. Risky in a way that you don't hold the coins you're going to lend.

That interest might be a good profit for you. But holding it with peace and no worry will make your decision better and lesser stress.

But the question is if that 8% is consistent? What will happen to you and your loan of the return will dump? That taking a loan not totally a bad idea but in your case, that is really hard. 6% rate is really high for a loan, I hope you realize it. If that only 2-3%, might you will survive and can payback.

If you would like to have a loan for this reason, just look for a lower rate and just don't just rely on this investment alone to make the pay off your loan. If you have other sources much better as you have another option.

6% per year or monthly?

If it's monthly, I suggest to just borrow money from the bank and invest in yourself by learning to trade, nothing is easy in crypto, everything has a risk so be careful in borrowing funds as you might regret your decision.

Obviously it's annually since he said APR. Do you think he will go to ponzi site which offer 8% interest monthly?
I get OP point, what he trying to do is tricky, it's like doing arbitrage (buy from a site then sell on other site). You could lose all your money if the site run away with your lending money, OP

One of my rules is to never invest borrowing money because in any trade or investment, there are always risks and you can never turn it off. Hence, there is a chance that you might lose a big amount of money that you can not afford to pay back unless you have a decent job. Moreover, nothing guarantee that the coin you are holding will continue to at least stable for a year. Everything is hot during this time, one impact will make everything explode

Try to make money by your own hand and then, you can do whatever you want with that amount of money

Well, you can try it if you want.
You need to know the risk because many do not recommend borrowing money from any third party.
After all, that will make you in danger if you can not repay the money.
Maybe you can try any free money that you have to invest in bitcoin or altcoin, so there is no risk of paying the money, and you can only wait for the increase besides seeing the price is down.
But that will be less risky than borrowing from the other party.

Don't forget those loans have an origination fee also. Maybe lose 3% right off the bat.

I'm not into De-Fi so I'm quite ignorant, sorry about that.

I can understand the team easily using per annum or per year. but anyway, it's not so important, what is important is that borrowing 6% interest to get 2% profit, I guess that is not wise 2% is too small for a risky investment,  so I would still recommend borrowing fiat and invest in crypto, I guess bank can still offer 6% per year depending on your collateral and credit credibility.

I believe the 6% interest is monthly, You will loss a lot of money considering that 8% is a yearly profit meaning you will have 0.666% profit from staking monthly. Its OK to borrow BTC if the current price was oversold so that you will not suffer big loss if ever the price drops more. You can also gain profit if the price pump after you bought but this is a very risky method. I just do it whenever the price drops and my salary date is still far.

Thanks for your vision. I never have borrowed dollars to buy crypto. Mine was just a question.

Borrowing money is a bad idea unless you have the means to pay it back over time (say mortgage).
No matter how certain the investment looks.

THERE IS A NO SUCH THING AS A FREE LUNCH! _{(Except HODL Bitcoin)}

I recently put some Bitcoin on Blockfi to get 6% from them lending it out. I briefly thought about using my bitcoin to get a loan through them instead of loaning out my bitcoin on the platform (note that you can't do both, if you put your btc as collateral to get a loan they don't loan out your btc for interest). But then I realized their loans are for 12 months so you have to pay the principal back in a year, and the interest rate you pay is around 11%. It's very high! It's not 6%, 6% is the interest you get if you DON'T take out a loan but let them loan out your bitcoin. Also for some reason when I put my btc on their platform they didn't even allow me to take out a loan, not sure why. Personally my plan was to take out the loan to buy polkadot cuz that returns 12%, but when I realized the interest payments are 11% it just wasn't worth the risk involved, cuz if BTC outperformed DOT by even just a little bit the math wouldn't work.

Due to the very high interest rate you'll pay, the volatility of crypto, the fact that defi rates could change, and the fact that you have to pay off the loan in a year, I'd consider this to be quite risky. If you want to put your bitcoin to work it's better to just get the 6% interest you get by leaving your btc with them so they can loan it out. I just put 1.57 BTC on their platform, making 6% a year that's like 0.1 BTC a year. Even if I didn't let that compound, within a few years that'll be making me a lot of money from just a little bit of my Bitcoin and completely passive income.

Just a general story about taking out loans to buy crypto. In late 2017 I took out a $35,000 loan to buy bitcoin when it was in the $6000s. Great timing as market tripled in the next 6 weeks, so if I had sold near the top it would have been a killer move by me. Of course I didn't and finally got totally out of the loan in summer of 2019 when I wanted to be out of debt. I think all together I maybe came out roughly even on the loan, not sure. Point is, even with great timing and a booming market, it's still risky just from human error (greed) on top of the risks associated with volatility and whatnot.

.... until the platform gets hacked....

I don't know why people get into these problems. Bitcoin is going to go to at least $100k this cycle (maybe quite a bit more) and will easily hit $500k to $1M next cycle. What do you want more profitability for? Just buy with the money you save and don't put your bitcoin at risk for a little more profitability.

+1... it’s called greed.

A dangerous idea so far. Borrow funds for need is fine, but take a loan and invest in DeFi would lead you to lose your funds. Very rarely there are legit projects and we can't determine exactly who is legit or fake. For me, I wouldn't take a loan for these reasons. I would agree to take a loan if you are a good trader, perhaps you may build your portfolio if you are lucky and experienced. If you lose trading as well then you are in double loss, because you have to pay capital with interest to release your collateral. So think twice before borrow funds for investment.

If you have already built businesses on your name previously, using loans to reinvest it should be no big deal. But if you don't have the experience to do such things, then I'd advise you to stay away from doing this even if on paper you'll be profiting in the long run. There are lots of investment baits that seem to be good in theory but does not always meet the numbers in actuality that it's hard to borrow money in order to get in. Perhaps just earn from your job first and start small, it'll take you somewhere if you consistently tend to it I'm sure.

So trying out to sip that 2% difference in APY? No, it doesnt work that way unless if you do deal with stable things like fiat but for crypto? Imagine first the volatileness where the main
factor that would really be affecting towards your plan.Those examples given on earlier page is on spot. Swinging up prices up and down will be the deciding factor neither you would
gain profit or would basically patching up on the amount that you had lost just for you to pay the loan that you had taken.
So i would really disagree into this kind of idea which it isnt really worth the risk.

Investing on BTC with 8% interest may sounds good but you are talking about a defi which can become a scam project in any time. It is better to take fiat loan and invest it on BTC which is pretty less risky compared to your idea.

I would rather taking up some loan and put it up on a real-life business than on putting it on a defi platforms which we dont even know on when they would be lasting out

but honestly, why would really be taking up some loan that urgently if you can really find out ways to accumulate coins if you wanted to? Dont think about APR passives because
you can eventually earn those more than with just simply holding.

On my part, i would really be avoiding any loans or some sort.

It was not monthly actually, I got corrected in my post above, APR stands for Annual Percentage Rate.

The interest is low, good for investing or trading but not for staking IMO.

I don't think it will give you profit and you are comfortable when you hold it. Borrowing money is your burden, you have to pay it back when you have money. Whereas you hold bitcoin is a risk as well, because the volatility price is really high, you may get a huge money because its price increase but you will get lose in a few time because its price decrease.

Unless, you are an expert to trade or investing. You may have a chance to pay your loan and getting profit with that. The interest 6% is really high I guess, you have to count and wondering if it's worth it for you, your responsible is not how to pay your loan but you have to pay the interest. So, I guess it is not worth, I suggest you to work and get the money after that you can hold bitcoin.

That can only works if its a good site and if you’re dealing with a good project that 8% profit in return is guaranteed on APR which I doubt. Borrowing money and reinvest it only works to those who are familiar with the market and knows what to do, I never tried to borrow on that project and reinvest it with them, maybe you can borrow real money and buy more good altcoins, this is way better for me.

You need to becareful with all these DeFI smart contracts. Every week or so there is some new exploit discovered where people get all their money stolen.

If you really want to do this do it either by using Gemini Earn where you get like 7-8% per year. Or use something like a futures broker and just profit off the premium. Currently the September futures has a 12% premium so in about 12 months its about 24%.

If you got good credit you can probably get an unsecured loan for 8-10% and you would double your money. Just make sure to use 2FA. You just deposit fiat, buy on spot and short the futures.

I wouldn't say no to this right away, I never really understood people who looked at loans the way some huge companies look, you do not have to do something that big, there are small loans as well. For example, taking out a 2k loan is still a loan, taking out a 10k loan is a loan as well, you do not have to take out 100k loan, get a small loan even a person that works on mcdonalds could pay, and invest it right away into something that would get you money, and you could repay the loan with your salary and keep doing that constantly.

It is a very valid method for people who can't save money, if you have to put some of your salary aside and live with the rest and save that small amount aside each month to get to 2k and fail to do that because you end spending it, getting a loan is a much better method if you ask me. This is why I am not against loans, I am against bad loans, there is a difference.

Why use platforms like this when it's risky?
Try using banks, that way they will have no idea where the money is going.
You decide it yourself after taking the cash. I don't recommend loans on platforms like this, there had been a lot of scams that happened back then and it won't change that easily.
Get cash, buy bitcoin, and use Bitcoin as means of buying other coins that you have a knack for.

What you need to know is that investing is full of risks, borrowing funds to invest must be supported with confidence and expertise in investing so that it can produce results as expected, and you can also pay debts on time according to the previous agreement.
I personally don't want to do that because it's very risky if it doesn't go as expected, it's better for me to borrow funds to create a real business or business that will generate profits every month that have been conceptualized beforehand.

Don't forget to invest money that we can afford to lose, meaning that we don't use risky sources of capital. Because using borrowed money
as investment capital, in my opinion, the risk is very high. Now the crypto market is indeed in a bullish trend, but that doesn't guarantee
that it will always be bullish. What about when we use borrowed money as investment capital, then suddenly the market becomes bearish.
Our losses will be doubled.

That is if you can payback the loan without interest and your investment pays it around that timeframe but if it is otherwise then I suggest not doing so because loan is spending the money that you don't own and paying back more than the amount that you borrowed because of the interest, this can work but only if the loan is a large amount.

Such a bad idea with a high risk because let say you use your borrowed money or loan coin to reinvest in cryptocurrency like bitcoin while you're with it you will be emotional because you're focus was to generate a profit out of the borrowed money, you're being too curious and greedy at the same time because your main focus was to make the best investment especially if your borrowed money has a specific range of time to return with interest and additional burden if you don't have a source or means to pay it back (mortgage).

Exactly.

I was referring to a mortgage because it has intrinsic value as long as you insure it. You want to consume it whilst paying for it.

But borrowing for a purely speculative good is just waiting for disaster. And bitcoin is only going up 1 in the 4 years of a cycle. This will indeed have you up all night for three plus years.

If anyone wants to do something like this then sell your house and car. Live off scraps. Buy a trailer and a crappy car. Then invest everything in bitcoin one year after an ATH and in three years you will have atleast 20x your money if history repeats. (DISCLAIMER: DOING THIS CAN COST YOU EVERYTHING!!). DO AT OWN RISK!!!)

Yeah that's why I never understood all this yield farming and defi too. I know ppl talk about 100% APYs and shit but after fees and risk, and if you only talk about wrapped bitcoin I believe it's about 8% or so APY for Bitcoin. Is it worth getting rugpulled and hacked or scammed? I really don't think so.

Seems that 80% of people in here did nothing but read the topic and didn’t read the entire post. He is not borrowing money to buy crypto. He is just borrowing fiat and taking that fiat to refinance it at a larger interest rate that he is being charged.

So he borrows money at 5% and gets paid 10% by some crypto interest and he pockets the difference. There is no risk here. He doesn’t care if Bitcoin goes up or down. His only risk is counter party and hopes that his exchange doesn’t get hacked or his computer doesn’t let some hacker in.

So there is some degree of risk but not as bad as speculative trading. This is why in 2017 most credit card companies banned people from buyin crypto with credit card because they might default on the loan if price drops.

Money not his (loan, he is on the hook = risk)
Interest from crypto by counter party (risk that they run with his money or lower the interest)

Just a recipe for disaster IMO

Either he loses it all or the tables turn and he ends up paying for this construction for a fixed period of time...

This is a dangerous thing to do because you will not be able to reap the full benefits of your investment because you have to pay the loan plus the interest and that is if your investment grows really quick because most successful investments takes time and if you consider investing in bitcoin and other cryptocurrency, there is a high chance that you will suffer some losses on the short term which can dishearten someone into selling their investment with losses.

If you Know the Word Suicide , then that is what you are thinking .. Risking a Loan with only 2% profit ? what if the target did not meet rightfully  then your Loan interest will increase to time?

No never Invest a Funds that comes from loan in a market like Crypto with too much volatility , Rather Invest in real life Business that if you are an expert or experienced then you might earn more than what you needed.

Getting a loan to invest in something that has no guaranteed return is a big risk. You are digging your own grave if things don't go well on that platform where you will invest. If that platform is not good then you can just earn money again without being in debt. You won't suffer for a long time if you will invest your own money. Maybe you are just tempted now because some people you know earned from DeFi platforms, if you don't have enough money to risk or lose then don't bother investing in it.

I don't know jack shit about DeFi, but I'm pretty sure you're right--but even with my professed ignorance, I still think it's super-risky to be borrowing any amount of money in order to speculate in any aspect of crypto right now (or at any time for that matter).  Maybe there's some magic to all this that makes it less risky to do so, but I seriously doubt it.  I sure as hell wouldn't be taking out a loan to put into DeFi projects--or buying any crypto on margin or otherwise taking out loans to do that either.  Lots of people tend to not care about the risks involved when an asset like bitcoin is at its all-time high, and those are the people who get burned in the end.

As an aside, this freaked me out until I realized what today's date was (just woke up):
https://i.imgur.com/duYUtag.png

Good that you change your idea for getting loan to invest in crypto. If it was a stock or forex market, perhaps you could have tried your luck, but a market as volatile as crypto, this would have been a very risky decision.

Invest in crypto or forex or stock will have the same risk, but if she can learn what she wants to do, she can minimize the risk and might have a chance to make a profit.
I hope she understands that getting a loan and reinvesting it in crypto, forex, or stock will not be good and have a big risk.
I suggest she invest in crypto using the other income if she now has that, which will be safe for her.
Before she invests in crypto, she needs to learn how to pick the right coins, and I suggest she select bitcoin.

NO, get a loan to reinvest in cryptocurrency is a bad idea, you don't know what will happen in the future, what happens if you choose the wrong coins?? And I see you are a newbie, so go learn about the risks, don't just learn about profits. And you must know a rule of investment, only using side funds, not main funds not loan funds

It is a very bad idea to take a loan when your expectation is making a 2% profit margin. There are too many things that can go wrong and unexpected fees (e.g. trading or withdrawal) can quickly wiped out any benefit. There are certain situations where loans can be useful, like if you had taken one out after the big drop in stock markets at the start of Covid. You could easily be sitting on 30%+ gains by now, but it is having the knowledge and stomach to make the right commitments when the opportunities are there. It is certainly not worth it for a 2% spread and after everything is done, you will be lucky if you actually break even. The best advice to your question is avoid this idea altogether, it will not be worth the stress.

Not really a good idea. You're just putting yourself a lot of things to work for and to worry for. You hold it at ease and you don't have to think about APR or so. You can make more if you hold it or add more if you're one of those people who do cost averaging.
Profit will be taken only by the fees and net will be like a piece of cake which might put you into a frustration.

With crypto prices still in a bullish trend, many people only focus on profit, does not take into account the risks that will occur if we use borrowed
money for investment. I agree that should avoid investing using borrowed money it will only be a problem in the future. Especially if we choose
the wrong coins for investment and we experience a loss, this will only make the problem bigger and ultimately stress us out. Use the extra money
we have for investing in cryptocurrency, so if the market crashes, we won't panic and can be more patient waiting for the market to recover.

This could never help you but instead, this will only compromise in the end especially when you can't manage to generate profit from your trades.

Almost all of us here are asking not to do that, if you will listen to us, you save your life. Don't get brag by many people talking about trading is really profitable, it maybe it works with them but not sure if it works with you. You may this work for you, Trading isn't for everyone" and don't force yourselves to do that if that is really not meant for you.

It would be wise if you put it up on bitcoin instead rather than defi.I would have that confidence that percentage gain on a year is much more worth but honestly taking up some loan just for you to invest it again
in crypto isnt really that much of a good deal because you wouldnt know on when things would be increasing and also due date is just too short.You cant just simply wait until they do increase before you
do repay those.

So i wont really be considering this kind of option because it is just way too risky but if you can handle out the risk then go ahead but if not then better dont mind it off.

Getting some loan for the sole purpose of investment here on crypto is never a really good idea to take but well its your choice.

Do not bother, take a step back and begin to think, when it comes to banks who do you think wins when they give a loan the bank or the person receiving the loan? It is obvious the winner is always the bank, if you ask for such loan with interest rates that are that high then you are adding even more handicap to your trades, it is going to be almost impossible to win that way and even if you do a great deal of those profits will go towards the person giving you the loan, do not do it, it is simply not worth it.

The scary part is that, even if we do not pay our loan back, governments bail them out while screwing us over.
That's something I have talked about during 2008 as well, well it was 2009 and 2010 when these talks increased, but I said the same thing.

If the crisis happened, and if 800+ billion dollars printed to help those banks, and the reason why those banks were bankrupting was people not paying their mortgages, shouldn't it mean that when that 800 billion dollars were given it should have been covering the unpaid mortgages as well?

I can understand people who paid their mortgages being mad if people got their houses for free, so instead of banks this would mean people would keep their houses and pay their mortgages to government. That could have seriously happened if you ask me and it would have fixed a lot of common issues in banking versus people fight.

Keep in mind that to receive the maximum annual interest promised by these platforms you have to acquire a decent percentage of your total investment in the platform own's currency. It means you aren't going only to invest in stablecoins, but also in nexo coins in Nexo platform, for an example. And nexo coins aren't stable, so your investment is under constant volatility risk.
Let's say the platform works perfectly and the interest rates don't change (what isn't 100% sure), you would still face market volatility over your invested coins.

I'm afraid but this is what it could surely gave to a person, a compromise that you need to pay it on due time either you have a money in your hand to pay or not because this is what the agreement of taking a loan isn't it? Well in fact I bet that there are some of us here or even in the real world of businesses that considering of taking a loan to start their business, to trade, to invest it could help but yep things might just get worst without a proper management of the principle been get as a loan.

Getting a loan to invest is not advisable by the expert specially in crypto, Because crypto is high on volatility and there is no asurance that you can earn in one blink of an eye. So be careful just invest an amount that you can afford to lose and dont make any loan at all for your own good there are always a big dip after the bullish market wait for it and be good.

Even not experts could really give out those kind of advises because we can really make out some experience which could really tell us out sensibly that taking a loan and invest on it
specially if you do deal with crypto then it isn't something that you can just make easy money and able to repay those interest but if the market would really able to do so then
youre lucky but if not then you are really in big trouble since you would really be paying up those interest with your own pocket not on the investment that you had made.
So you should be aware on what youre dealing with before you do jump into this market.

Besides, that is the reality of committing a loan. May we pay on time in the first two months but couldn't be sure that our profit is sustainable enough to cater a long-term loan payment. In fact, 6% s really and that to risk for that money to an unsecured market retuns. I wouldn't that of course, and we have to think about what will possibly happen in the next few days, not just today.
If we have another source of income that can help to make payment, maybe it can sustain but if there is nothing, it is hell no.

Borrow $
Buy Mining equipment.
write the borrowed money off and pay out of pocket
or make sure mining operation has positive unity over your loan, or cover decays from pocket.
I've kinda done this multiple times, Ill literally work for graphics cards or finance them sometimes, or essentially net30/45 em.
(I haven't gotten Asics in years)

Yeah, I remember the 2008 crisis and it was even worse than that, banks got their money back and then they got to keep the houses as well, but obviously banks do not care about them since they want to lend more money for them or to sell them to someone that can actually pay them, but then when the same people that lost their houses because their mortgage was now more expensive than the actual money their house was worth tried to buy their house now that the prices were cheaper banks simply refused out of spite, banks never really lose it is heads they win tails you lose when it comes to them.

It doesn't happen all the time what we want. What is the guarantee that APR will be stable? Sometimes, we have to pay interest from our own income. But you can take the loan and can trade if you are a experienced trader. I hope, you will able to pay your interest and earn good profit.

Just make sure that you Have enough Funds and Back up once the plan did not succeed , because if not then for sure you will be in the end of line and may Lose everything in life.

With the market Blooming now ,i know that majority of us are planning to Make a comeback and we cannot blame them from it.

But be sure that you have a plan and a back up plan also..

I would not recommend taking a loan to invest with crypto regardless of how much profit you can get from it because is still risky as the coins are volatile yet we don't know exactly whether the coins are going to increase or not. You can risk it though but make sure you have a plan and it might bring a profit, however, you must also prepare for the worst because once the market turns out against your plan then you will use your own money to cover up that loan. Besides, I think it is even the rules in investment that never to take a loan nor invest the money that you cannot afford to lose.

Whether it is with Bitcoin or stocks never go for an investment borrowing Bitcoin or altcoins paying certain percentage as interest. It is high risk involved and when we talk of defi investments we need to be more cautious, because only the trusted projects give good return. With certain DEFI getting paid as interest and staking doesn't gonna get good return.

Go for borrow and invest, only when you're sure about a project and it's outcome.

I decided to sell my house to buy BTC in 2017 when the FOMO is happening and although my portfolio was decreased by 80% in 2018- 2019 but by now, I have gained nearly 1000% profit, although I have sold some btcs too early in 2020.

That is not a good idea to do as buying mining equipment will not cheap and you need to buy high-end hardware so you can earn a good reward. There are no stop buying the mining hardware because the difficulty of each coin will increase from time to time and that will make you upgrade your hardware with the latest technology. That can cost you money, and that will better if you use it to start trading. But taking a loan to buy or invest in crypto will not be recommended, especially if you do not have the other income because you need to pay the interest monthly.

Let me buttress my point a little: APR aren't constant figures, likewise the price of different coins in the market, so, is the likes of APR. The coins you intend to choice today might be doing well but suddenly something happen and it price drop, so will the APR drop also. There were stories around the internet about funds managers who ran into loss and later ended up in prison, what do you think about them?, unprofessional right?, i said NO they are professional but the market went down without any notification: More reasons you always hear some slogan "invest what you can afford to loss".

The thing is, if you are a ruthless banker, you should not be a banker, that is the point, nobody that would be a great banker ends up being a high level banker they end up being crushed under the requirements to go higher, they try to be good and they end up losing it all. This is why the only bankers at the top are the ones who have achieved those ruthless requirements and that is why they end up being at the top while doing all sorts of near criminal stuff.

Not giving people their house back even if they want to pay for it? That is the type of thing that bankers do because they are idiots, they should know better than it would be a great business decision to do that but they end up not doing it. And we are talking about people who paid their houses in full but remortgaged their 30 year houses and lost that, sure bad financial decision but still it is better to give it to them to someone else.

Waiting up something like APR and just doing nothing with those loaned amounts then it would be much riskier yet you wouldnt know if you would earn or not on said due date
but most people been thinking that it would be more on risk if they would be trading it actively which i can say that they are somewhat right but if you have able to done it well
then you can really possibly earn more than on what you do anticipate or expected. Overall, its not really that suggested nor really that recommended on taking out some
loan just for that sole purpose but since you do look it to be beneficial then go ahead but i would say that it isnt really a good idea.

Next time you quote me can you contain more qualitive subject matter? Your argument is elementary at best.
Most people without jobs aren't like "Fuck I need to pay these bills and eat, I know ill get into bitcoin!"
Bitcoin will call your BLUFF.
I hear your concerns though, but simply put the topic title says "get a loan and reinvest it" I'm just joining the conversation.
What works for me doesn't work for everyone else. To each his own!.

loan for investment? are kidding me??
there are many example out there.
if you re lucky then you good. but not many especially with those %APR
you re playing with many risk  ;D ;D ;D ;D

for me, i won't take any loan for investment. its very different if you need a loan for your business

You must know that in cryptocurrency people invest using cold funds, side funds. It's too dangerous if borrow crypto or stable coin then reinvest it, because no guarantee your investment will succeed, so play safe is better rather than take risk if using borrowed funds

I won't suggest to do this action also. You have no clue if your investments will indeed really get that returns. What will happen if your investments will earn negative income? How can you pay your debts? This is not a smart move to do. Better invest your own funds even it is small. At least, whatever happens to that funds, is all yours. You don't owe anybody if something goes awry.

Taking loans out on any asset to invest into a volatile asset is a terrible idea always.  Thats how people end up bankrupt and rekt. Work more make more fiat and invest that.  Only put in what you can lose is what they say right.  Don't borrow to try to make money its a losing strategy.

Borrowing something that has an interest is really risky and it is not really advisable. If we are going to invest in crypto we need to study and see how it works because crypto is an investment that is risky because it is high on volatiliy.

This depends on what type of economy you live in, in a country with a fully inflationary economy it is best to borrow with the largest amount of local currency, there is no better business than that, because if you invest it in Bitcoin, the interest will be They pay only with the normal movement of Bitcoin, if the price of Bitcoin falls it is not much the problem because when the conversion is made to local currency the value of bitcoin will be much higher and in profit than that of the interest on the total debt As I say, this is ideal in an inflationary economy, in economies that are more stable, I think conditions change there.

With crypto, or fiat, made investment with borrowed money is really bad idea. Maybe almost everyone's answer is same, not agree to do it. Because investment is risky, and not every investment will gain profit. It will make people more suffer if they lose, because they still must pay their loan.

Always go ahead when it comes to situation where you can possibly be ended up to because just like said there would be only those situations neither you would lose or would able to gain
for you to pay up those loans with interest but honestly taking up some loans for the sake of crypto investment is really a risky move to be done.Its better to find up some source
rather than on considering this step but if you are really eager to make this option then its up to your choice but remember always the risk so that you would be
prepared and able to face it up once it did happen but if it turns out that the market is on your favor then it would really be rewarding.

Well, the intention is good but you neglect to see 6% interest rate is big enough that could give you some burden when in times of paying the loan. If you can find other platforms that can offer less, that will be fair unlike having this one. Will you have the capacity to pay for this on time?

I hope you'll be thinking this several times. You might be reading that most of us here are not in favor of committing loans just for trading or for investment it is just because we can never have the assurance in crypto. The volatility will affect your profit and that we can't guarantee that we can be profitable all the time so we can make payment as what is the promise.

I confirm that introducing leverage into crypto usage is a bad idea for a limited indivual.  If a company or fund wants to do this they can spread their declared losses over 6 years against any taxes and do far better in dealing with the loss over time but a person can easily get caught out by changes in volatility.
  In simple terms think of it as getting in a rowing boat that hasnt been tied to shore, you will find yourself split impossibly and getting wet :p

Arbitrage is something hedge funds do, famously we had a billion dollar fund blow up on this basis in the late nineties.  The inventor of that particular attempt made alot of money and then they lost it all and some more, they were Nobel prize winners.   They werent wrong, they were unlucky and the market destroys people who dont respect it like a volcano pretty much.   There is no free money :)    I like Jim Rickards for his discussion of natural events in free markets, historic precedent and extrapolation, he respects BTC as a form of cash which many others refuse to do so (or only changed their mind when profits came calling). I count him as one of the good guys to listen to in the big scheme of things, crypto isnt fractional reserve its part of why it goes up so severely.

That is the problem with investment as a regular person, a company could even show losses and not care about their crypto profits or losses because at worst they would be basically saying it is a loss on their taxes and that would make them richer. Think about it this way, there is a wall street company that made 1 billion dollars profit on their stocks, they pay taxes accordingly but if they also have 1 billion dollars loss on crypto they will pay zero taxes and that is why I think it is quite obvious that we are going to end up with a lot of companies who are getting into crypto since it would help them.

If they make a profit they make a profit, if they make a "loss" they still own those cryptos that they will profit later on and right now that helps for tax write off. That works very well for companies, what about regular people? We get none of that.

Couldn't put it any better than this. And this is exactly why I never take loans to make investment. Even with mainstream assets such as equities, I have a policy of never making an investment from a loan. There were a few occasions where it was looking very attractive to make an investment in IPOs, and I couldn't do it because I was short of cash. I had the option of taking a loan, but went against the idea in the end. And most of the time, it worked for me pretty well.

I still couldn't get those people who go for loan to invest. Do they really believe that they can get 2x or more profits within 30 days so that they can close the loan or they plan to encash some of those investments to get ready for first installment of that loan? Because, loan must be a monthly commitment whereas bitcoin investments or any mainstream assets like gold also may not produce good returns so that we can be sure about repaying loan on time.

Bitcoin showed a good progress this year so far but we cannot be sure about it will be reaching these levels by the beginning of this year so that we could have gone for a loan to invest in bitcoin and to enjoy these levels of appreciation. So, it is fully risky one hence when we are dealing against unpredictable risk, it is always good to go with what we are having excessively in our hand.

Matters with self control and not all people would really be having that kind of discipline in mind on following on what they had ruled on earlier.
If you dont like to put yourself into trouble then the best thing to do is not to take any loans, no matter how attractive the situation is for you to make out some investment.
You wouldnt know on what comes next unless if those funds is something that you can pay later on without relying on what you had invested.
You wont really be putting yourself into some sort of problem if you do have this kind of behavior.

That is a problem if you can't afford it, but if you can afford it you are talking about a chance to make even more if you can hold and that only matters if it drops. So, this means if you buy a loan of 1000 and then it goes up to 2000 dollars then your bank wants 1060 and you made 940 dollars profit right? That is the good side of course and not the bad side.

However if you look at the other side, if you get 1000 loan and it goes to 940 dollars, you are going to lose money but it is easier to get a loan and pay that instead of saving money monthly when you get wage.

It means you could risk it, if you can only pay it back and that way maybe it will fail this year but next year it will double? Or maybe the year after that? It is an investment you made and you may or may not profit from it on the loan but at least you would get in right now right away instead of waiting a year and hoping that it will go down when you have enough money.

Loaning is not always bad if you already have some funds in your pocket. For example, if you have around $1000 and you put them all in safe investment, for example, it is bitcoin or Ethereum, loaning in this circumstance will give you more funds to invest in another project. Take a loan as small as $300-400. There are many opportunities to generate outstanding profit. Just look at Binance coin, it has given investors more than 900% for investors who invested in the early of this year

Taking loan and investing will always profit, if the investment is made on the correct cryptocurrency. My choice is to have own fund in hands and then go for a loan. If you've got $1000 in hand go for another $1000 as loan. Now analyse and choose the right cryptocurrency for investment. The market is highly risk at times, so to minimize the loss we need to have little holdings apart from the investment amount. For this reason I prefer backing fund other than loan amount for investing.

The market is already containing alot of leverage that is the main danger to adding into that and hoping to sell before they do.   I was reading a good article on funds trying to take advantage of premiums for a profit and it easily goes wrong and reverses.   My base line is the basic case for BTC and utility it might offer to small users vs ongoing FIAT inflation, if thats not there I wouldn't believe in it especially as I think that backs up all other speculation and market action despite their size its the smallest elements that matter most.

https://decrypt.co/63779/grayscale-bitcoin-trust-traded-discount-nav-for-month

wont also take a loan just to invest in a very risky environment. if you are thinking about investing in crypto projects, not advisable to me to get a loan and risk it. but when it comes to tangible assets like maybe real estate, i would go for it - taking a loan. but here in crypto, even if we say, you are a veteran wanted to invest in a new project, thats very precarious imo
ive seen a lot of crowdsourcing campaigns here, invested in some, but ended up losing. and again, am tempted but i need to keep my funds safe for now. hard to gamble in new projects.

Borrowing FIAT to buy Bitcoin can be extremely rewarding but it comes down to timing
and to whether you can pay the loan in the short to medium term.

I have done this twice last year, my idea was to "pre buy Bitcoin at a cheap price"

The timing was right because we were about to have the halving and were entering a bull cycle.

In february 2020 I was able to get the first loan and buy Bitcoin at around $10,000, I have
realised a 6x return on this and the loan is now paid.

You got lucky because bitcoin increases its price. But the OP is asking if he will borrow btc at a certain interest and invest it into a DeFI project with supposedly higher APR. I think, this one is very dangerous to take. Because you have no idea if that defi project will deliver their target APR. What if that particular DeFi is weak and haven't gotten the interest of crypto users? That APR will go down and you can't recover your losses.

This do certainly talks with some luck when you do make some loans for you to invest in bitcoin and able to repay those interest on specific time because not all would really
be having the same result or situation because the market is way too unpredictable.There's no way you can precisely tell thats why its risky to take some loans for you to
make out investment but if you can repay it without the need of those profits then go ahead .

Its a matter of risk and if it turns out to go along with your side then for sure you would really be happy in that case.Getting in as early of $10k is something remarkable.

I was among the unlucky ones, because I borrowed money from the bank to buy Bitcoin and altcoins in 2018. But until 2019 the crypto price had
not fully recovered and I was already having trouble paying my debt repayments. Finally, I had to sell my car to pay off the debt, since then I didn't
want to invest in crypto using borrowed money again. As you said, not everyone is lucky to be able to pay debt repayments, and also the crypto
market is difficult to predict. So it is very risky to invest using borrowed money, don't let my experience all of you experience it too.

Get a loan and reinvest it is not the best solution if you want to earn money in cryptocurrency, remember that crypto is fluctuating, if you choose the wrong asset then you will regret your decision. You should join in crypto using side funds, not loans or your main funds because this is so dangerous. Also, don't sell your real asset only for join in crypto

Think of the very huge difference that the exchange will have and you being the borrower, you'll have the lower part of your own portfolio.

Investing and thinking of its 8% while you only have to pay for the 6%. Don't you think of the market's volatility? if it's stable coin then it's up to you and do that strategy that would make you earn 2% but it's not the usual case because there's lower amount given to you from your collateral.

yap, I don't know man, but I already know a scheme like this and still don't like it, lol. sticking to the fundamentals, only investing in something you can afford, I think it's safer and will bring better profits

This is a very risky move but at the same time if you can manage it well you can play it well some defi projects from known launchpads in bsc and eth are really profitable if you are lucky to enter just be sure you can join in Presale and your investment will either give you 10x-50x yes I have seen it in many defi projects like in Kickpad, Polkastarter, Duckstarter etc..I will not suggest some staking with APR since it will take a long time to earn the good thing is its a passive income but you need huge capital for you to earn huge return.

Timing is everything. In the case of Bitcoin you moved too early in a bear market.
The same will apply again if we go into a bear market in 2022, there would be a
similar opportunity in 2024, possibly.

In the case of investing in some DeFi project, I would be very sceptical and with
borrowings, very apprehensive. There are way more variables to consider.

What DeFi project?
How do you know that one is going to rise to the top ahead of all the others?
What if the project team decide to disappear with the funds?

With Bitcoin the project is proven, with any new DeFi project you are relying on
an element of luck and hoping the DeFi idea doesnt fall out of favour for some
other shiny new idea or project, like the Altcoin scene

Well, I don't recommend that. we don't know when a place could become a scam. maybe you can make a profit in the first round, but what about the next. besides, I think it's too risky to borrow money just to invest elsewhere. however, I don't think it should be recommended, and I think it carries a high risk.

The platforms like nexo or blockifi may give you loan on fixed interest rate but there is no grantee that you can earn more interest by investing it in any defi projects. If you want to invest in defi projects or staking then do it with your own money. If you take the loan, and your project failed, you will still have to pay the loan.  :(

Why not sell assets in real life and then reinvest it in what OP mention. ;D Basic thing to make investment is not to use money that be used on daily needs, which if we lose in investment not really interupt our daily needs. Use loan money to make investment will make it worse because no guarantee we can always profit in our investment in whatever the business is.

Going all in is just a suicide because there's no guarantee that you'll make money into this market which means you do need to handle up things accordingly and be sure to handle and be wary with the risk.

Taking some loan for the benefit on making out investment isnt something that you should really be doing.If you are really that eager to get in into some opportunity that you do spot out then its your choice

but as better as possible then you should be using up the money which you can only afford to lose because not all things would really go into what we are expecting.

Even though there are lot of platforms that offers to borrow any promising coin, I think it is still not a good idea. Market is still risky and unpredictable that is why many people lose their money in just one mistake. So even though it is a good coin that they are offering if we cannot handle it, we can't make earning through it. What are we going to use to pay the coin that we borrow if we lose? In addition, it has an interest. As long we are not giving back the coins we borrow, we will be immersed in debt.

Yeah get a loan that you will probably default or cost you more interest because using it as an investment only works when you are a billionaire that can make things happen but if you are starting investor, I advice you to save money and then invest. Loans aren't your friend.

Getting a loan and reinvest it wasn't a bad idea and not a good idea also. Well this idea was for a good loan maker with a good business and/or investment analysis or trading analysis because taking a loan without proper wisdom about reinvest was very risky. But in my own opinion, as long as you don't have to end in an idea of taking a loan why not try to sacrifice one of the things you have that are valuable that you think can give you an amount of principal that you needed to reinvest.

I'd find no good for this, actually. For the reason of committing a loan just to reinvest because you wanted to recover your losses, that is not a good idea. You just wanted to compromise yourselves in the future. If we have a plan to invest in crypto, it is better not a borrowed money especially when you have to pay some interest. We are facing a huge risk here, we are not sure what could be the result of our investment, and what I worried about is if we can still pay our loan just in case we fail again?

Borrowing money in order to invest is an advanced maneuver that should only be performed by expert traders, the reason for this is that you are taking an additional risk and as such it should only be done when all the factors align themselves and tell you that you have a very high chance of making money with such trade, if you do something like this when you are still a newbie thinking you can multiply your profits this way then you will lose all your capital in a heartbeat.

More beginners avoid in this case the experience is not broad enough if you only rely on loans just to invest and multiply it, I know the experts have become consistent in making this decision so they are full of risks they will face, therefore loans are something that often does a lot and this is usually in a pinch when there is no reserve fund.
Better with a reserve fund, it will be safer and you don't have to think about paying the loan when you don't recover the capital.

There is a complexity between "buying at dips" and "available funds". I mean not all the people are ready with reserve funds when there is a dip in the market. So, it is becoming inevitable for most people to go for loans to make use of dips to maximize their bitcoin stash. I had the experience of buying bitcoin with loan amount. Even that was during the period of bearish markets, I somehow managed repaying the loan from my regular job.

In my opinion, current market scenario may be or may not be the right time for buying bitcoins with loan but definitely if you're buying in bearish trends then there are a lot of possibilities to get cheaper bitcoins but you need to repay your loan from some other resources.

You really take high risks, because taking a loan just to invest in the crypto world is a mistake for me, yes, because the risk of investing in the crypto world is very high, therefore it's better to invest with your own money, and don't follow ICO or IEO projects which is not clear.

If you can invest in the right currency investing with a loan will become profitable. You can invest more money in the long run than in the short run this may seem obvious but many people do not realize how powerful the effects of time can be on the transfer of wealth the best time to invest is to run bulls in the market and over time with interest rates, you will earn both your original investment and the interest you earned earlier.

Yesterday I open Facebook and I see history from greedy people because they sell their real assets and invest in cryptocurrency and loss. This is a different story but the moral message is the same that only using your free funds, don't sell your real asset, or don't make any loan only because want to invest in crypto

Sounds too dumb to be done but there are really people whom do really believe on the potential.
Ex. Going all in with bitcoin

https://www.cnbc.com/2020/12/16/bitcoin-family-investment-nearly-triples-20k-price.html
https://www.cnbc.com/2020/12/03/bitcoin-family-invested-their-retirement-and-savings-in-bitcoin-ethereum-litecoin.html

The risk did pays off if we do consider on how far these coins had able to reach out.

The attractions of leverage should pale next to the massive moves already possible in BTC, timing is everything and leverage amplifies the accuracy required to time it just right in hitting the bottom price.   Also the more leverage we have the greater this graph will twist and turn and be unpredictable as main markets leave an imprint in their influence from strength or weakness that day.
  With leverage you are more likely to become one of the crowd jostled about by the largest entities not the trading ninja picking off a perfect opportunity amidst the herd gifted a vantage by crypto from the safety of the sidelines.   Its not a good idea generally, just be correct while participating in a rise or avoiding a pullback and you have enough compounded % gains just from the already present volatility in the price action.

yes, but it is very risky. however, I am quite happy that when they did that, the price of bitcoin and the assets they held after selling their physical assets went up.
I don't know if they are very willing to take risks, or really believe that the price of crypto will continue to rise. however, many people think that the price of crypto is definitely going up, and they sell their physical assets for it. many stories like that lead to regret. however, I still choose to move with the free money I have.

Not all would really be having the same risk management just like what other people did into their decisions in life.Yes, its really a risky thing to put up all into something which the future doesnt really give out an assurance for it to succeed but it turns out that the market had really goes as planned and did really result into more fruitful living if those family in the links given are selling off their coins on this moment
or would still tend to hold it up until the future years to come but actually selling off into these points arent really that a bad idea to do so.For loan money then its not always ideal to borrow just for the sake
of investment because you wouldnt know on what comes next.

You have a point mate, we cannot predict the future so in investing crypto we need to invest an amount that is not really big or something like an amount that we can afford to loss, the fact that we cannot predict the future of the coin that we invest i think there is no great reason to put all your money on investing, we need to preserve 75% of our money and invest only maybe 25% of our money into crypto, we need to be wiser and be more careful because in crypto the market is always moving up and down so be careful.

But the question is if our market gains are sustainable enough to cover and pay our loan balance and interest. Because we know that we can't find assurance in here and even we choose the best coin like Bitcoin for investment, we can't guarantee that we can make a good profit by the end of the month. If that only we can find other sources like our salary to pay our loan, I think that was a good deal but if we just rely on the profit we got from our investment, that is somewhat difficult.

Borrowing to invest in crypto is worst thing that you can do. You can get hacked and lose everything. But you will still have debt to repay. A lot things can happen then just coin price goes up or down. It is way to risky, please stay out of it.

Yes, you should avoid such a method because borrowing to be reinvested is very risky if it just disappears because of being hacked or whatever and also if there is a sharp decline you still have to return it.
and it will be a burden in your life that has fatal consequences if your plans do not match expectations, you have to stay away from it and if you want to invest it is better to sacrifice what you have to sell and for capital gradually.

too risky.  There are many things to consider such as transaction fees, impairment, and security.  APY can shrink at any time.  talk about cryptocurrency: Blockchain is not going to lie but many of the Developer Team are actually scamming and taking away assets from customers.

- The value and profit in this market have never been mentioned with the concept of sustainability, it is always a random concept, sometimes it will be the end of the month but sometimes it will be the end of the year, not having an adequate source of income to make up for losses during the months with loans would be very difficult. Instead of trying to make such a coercive and somewhat greedy choice, create a lighter life with a normal investment and think only of a loan when the condition really matches the interest payment

Those are just minimal consideration, what you do mind off here is that you should balance the risk and reward ratio and if you do able to repay those loan on a specific due.
Its not really bad to take a loan if you do just know your responsibility.Some people or lets say that majority isnt really that something to be that interested on borrowing
for the sake of investment but there are people whom do risk on.
If you do look that you can pay it up without any problems then go ahead and take a loan as long you do know on how to repay them on time.

taking a loan is not a good action if you want to buy crypto, because of the high volatility you can become depressed,
it's better to use the money you already have, such as payment from your job or from your business,
of course your emotions will be well controlled when trading, save my word  ;)

You posted this at the 18th, I looked at the price of Bitcoin at that time and it looks like that it is almost the price as it is right now.

In general, this strategy is a high risk low reward strategy. Its a low reward since Bitcoin is at the top right now. At this moment, borrowing just to buy Bitcoin is very risky. Maybe you can do that in the bear market. Borrowing some fiat money just to buy the dip but that too is very risky. Just use your own money to invest into Bitcoin instead of having a loan. It will be a double problem to you if Bitcoin went down by the time you entered and at the same time, you will be thinking how will you pay the money you loaned.

I will never invest from loan money. It is not a safe way, you may end with a complicated problem. If you don't have enough money to invest, just wait till you have it. I suggest not force your self investing in crypto, don't invest because of the hype. Remember that only invest in crypto once you have extra money.

I don't know about crypto or stabelcoin lending yet, but as MK4 says it makes sense, if the platform says they give x% APR to certain assets, which means the amount could change.
This is another case due to the strong price movements of Ethereum and BTC, which have dropped other coins.

I am glad this worked out for you but we need to be honest, the risk in the market of cryptocurrencies is already very high and doing something like this adds even more risk, things could have gone wrong if you happened to lose your job, and we know this is always a possibility as it does not matter how secure you feel about your job, when something like a pandemic happens all bets are off and anything can happen, so if anyone did something like this during the pandemic and lost their jobs they could be in big trouble.

I've seen greedy people lose money by selling their real estate and investing in cryptocurrencies. This is a different matter, but the moral is the same: don't invest in crypto with your free money, don't sell your real estate, and don't take out a loan just to invest in crypto.

Not greed but rather taking up the risk but it do vary on the level of awareness and risk management of a certain individual on how they would handle out their investment in crypto.
Selling your assets like real estate or any other assets just to make more focus on crypto is really a risky thing to be done since we know on how unpredictable and volatile the market
is which you cant guaranteed on making money and if it turns out to be against your anticipated price but if in luck then you would definitely be gaining much profit compared
to traditional investments but its not really worth the risk.Always invest on the amount that you had earned or extra which you wont compromise other businesses of yours.

get a loan? Are you sure? a loan will cause a big problem if your investment fails, this is not just a mate investment,
you have to think about the risks, yes, if you go in and buy tokens and without reading analysis and fundamental techniques,
then you can fail, don't take a loan, use free money for investment.

There's a strategy that he has shared but it's a risk that adds another risk involve. It's not just about buying a token and investing on it. But he seem to built a strategy about lending it to defis or any platform that offers APY.

But that's hard to sustain in all means if someone thinks that he can survive with that strategy. From the beginning, getting a loan to invest the bought coins in those platforms is already a big leap of faith of taking risk.

OP isn't sure, this are all just shower thoughts and not the good ones too. Unless the loan doesn't grow in interest, I think a loan for investment is going to be a good one but I wouldn't put it in bitcoin or crypto for that matter since the volatility is pretty high which might result in losing a big chunk of your investment in a few days. Don't take loans if you can't pay it and if it has the interest.