You are viewing a single comment's thread from:

RE: 26% APR returns now available on Steem!

in #steem6 years ago (edited)

Hopefully the external market will realise this and flow money into Steem, I think the risk with borrowing in fiat is you owe it back in fiat so if Steem drops to 1/3 of it's value you are in a spot of trouble, with Steem Power leasing you aren't borrowing capital you are borrowing a delegation which gives you the same utility as if you had the capital, but leased at a fraction of the cost. This is more like leasing a car via AVIS than buying a car with a bank loan, not sure if that is a better way of putting it.

Basically it is the difference between having to pay capital and interest repayments vs only interest repayments (which is actually a fixed lease fee) and not being on the hook to repay the capital.

Also less paperwork and KYC.

Sort:  

"I think the risk with borrowing in fiat is you owe it back in fiat so if Steem drops to 1/3 of it's value you are in a spot of trouble"

And there you have it. All the other reasons where there when delegations were paying less than 20%. Perceived future value is why people aren't buying Steem with other currencies and getting 26%.

Posted using Partiko Android

Mostly people are bullish on BTC I agree, and dumping alts to ride the btc wave.