Edit: I guess when someone has “20 billion dollars” a 700mm loan doesn’t seem like a big risk.
On the other hand, I can see investing in firms that then take out huge loans to buy crypto. The math reverses itself. Crypto goes up, and you make far more than buying BTC without leverage. Crypto goes down and you lose your entire investment, but are limited to that (as opposed to taking out the loans yourself).
I suppose if they felt the loans were collateralized by something that was more solid than crypto, that makes sense. Like, yes I'll loan you money backed your MSFT shares or whatever, and you can spend it on crypto or whatever.
It’s very seductive. I like the railroad tracks analogy because in my real-world experience, railroad tracks can be seldom-used, and look like they’ve been abandoned. But every once in a while, something does come driving down it, be it a full train or maybe a pickup truck outfitted with bogeys, belonging to the company.
But only once in a while. If you don’t see one for months, you convince yourself you’ll never see one.
If btc drops too much, you need to dump your coins and repay the loan.
My guess anyway.
Should reddit be allowed to present financial advice via their forum.
That to me is a problem. Free Speech or financial system rules.
People can say things on a forum with no repercussions. True or not.
AMC is a shit stock now and it was 5 years ago. Gamestock too.
Elon Musk says one thing wrong and is attacked by SEC. Not fair at all.
Crypto should have been snuffed out by regulation many years ago.