get a loan and reinvest it

[el malagueno]

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.

[1714487062]

1714487062

[1714487062]

1714487062

[1714487062]

1714487062

[1714487062]

1714487062

[mk4]

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.

[franky1]

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

[Tytanowy Janusz]

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?

[Timelord2067]

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)

[BChydro]

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.

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.

[Yaunfitda]

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.

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.

[Hippocrypto]

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.

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.

[newwest]

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.

[sunsilk]

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.

[Questat]

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.

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.

[Distinctin]

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.

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.

[numanoid]

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.

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

[slapper]

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

[traderethereum]

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.

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.

[brokedummy]

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

[Distinctin]

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.

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

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.

[Coin_trader]

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.

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.

[el malagueno]

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

[Wilhelm]

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)}