On July 20 2021 12:01 BrTarolg wrote: There is also single sided staking, which also does exist (usually on lending/borrowing protocols) which is much more akin to earning interest in a bank, though again unless it's a direct yield on your lending, the yield is often some governance token of some kind which is where the apr comes from
So this "governance token" you get back is not either of the cryptos you are staking, correct? What is the governance token? Is it like another crypto? Can you trade it or exchange it for USD$? This is the thing that's created out of thin air?
So let's say you have a bitcoin and some ethereum to pare 50-50. You stake it which provides liquidity for other people in the exchange and as a reward you get some governance token which has some value. Am I getting that right? If so what's the risk? What's the downside? According to that shibaswap site I referenced earlier of all the parings you can make the lowest has a yearly ROI of 6% and the highest is 200%+. You can't actually lose your coins from staking them, right? Is the risk from holding crypto that might go down in value? It seems like like in the long run you'd almost always be better off staking your crypto instead of just holding it so shouldn't everybody be doing that at such a scale that it would flood the market and you wouldn't have to offer so much governance tokens to create the liquidity you need?
1. yes
2. lots of risks. Firstly you got "impermanent loss" risk. You are also exposed to the underlying you are staking unless you hedge that off somehow But the real risks are protocol risks (exploits, flashloan attacks, protocol failure), rug risks (shady team, rogue developers, "insider exploits", audit teams finding exploits and then doing the exploit themselves and running off with the money etc), network externality risks (some chains can get clogged up during high vol times where you might be wanting to pull your money out), You also have the risk of just using defi in general, the entire space is pretty much designed to psyops and find a way to scam you - i get tons of scam messages and DM's every single day. People placing links everywhere which can compromise your metamask through all sorts of day 0 exploits. I have top tier security for everything and have never personally been rugged for a large %age of my portfolio (but have still been scammed/rugged for at least 10k this year lmao). You have to approve tokens to smart contracts all the time as standard procedure, but all it takes is a slight exploit in the background that allows a proxy contract to swap the logic somewhere and that approval can lead into wiping your entire account clean in an instant, and a hardware wallet will not save you here because you approved it!
And these risks are not rare either - quite literally happen every week, for tens of millions of dollars vanished into the ether https://www.rekt.news/ Just trust me, if you don't know exactly what you're doing, you're going to end up getting rugged lol
But yes in theory, it's infinitely better to stake your money as the returns are out of this world.
edit: oh don't get me started with tax risk either lool. I am properly structured and secured but there are such things as "tax attacks" on defi where a specific protocol/coin is designed to maximise your tax bill and bankrupt you because the IRS interprets tax in a certain (outdated way) that causes you to become a paper billionaire and realise that tax but in fact you didn't make anything
Hmm, thanks for answering my questions. It seems like even if this crypto "staking" thing is not a scam in itself, it's not much better if it comes with a lot of risk of being scammed.
On July 20 2021 12:01 BrTarolg wrote: There is also single sided staking, which also does exist (usually on lending/borrowing protocols) which is much more akin to earning interest in a bank, though again unless it's a direct yield on your lending, the yield is often some governance token of some kind which is where the apr comes from
So this "governance token" you get back is not either of the cryptos you are staking, correct? What is the governance token? Is it like another crypto? Can you trade it or exchange it for USD$? This is the thing that's created out of thin air?
So let's say you have a bitcoin and some ethereum to pare 50-50. You stake it which provides liquidity for other people in the exchange and as a reward you get some governance token which has some value. Am I getting that right? If so what's the risk? What's the downside? According to that shibaswap site I referenced earlier of all the parings you can make the lowest has a yearly ROI of 6% and the highest is 200%+. You can't actually lose your coins from staking them, right? Is the risk from holding crypto that might go down in value? It seems like like in the long run you'd almost always be better off staking your crypto instead of just holding it so shouldn't everybody be doing that at such a scale that it would flood the market and you wouldn't have to offer so much governance tokens to create the liquidity you need?
1. yes
2. lots of risks. Firstly you got "impermanent loss" risk. You are also exposed to the underlying you are staking unless you hedge that off somehow But the real risks are protocol risks (exploits, flashloan attacks, protocol failure), rug risks (shady team, rogue developers, "insider exploits", audit teams finding exploits and then doing the exploit themselves and running off with the money etc), network externality risks (some chains can get clogged up during high vol times where you might be wanting to pull your money out), You also have the risk of just using defi in general, the entire space is pretty much designed to psyops and find a way to scam you - i get tons of scam messages and DM's every single day. People placing links everywhere which can compromise your metamask through all sorts of day 0 exploits. I have top tier security for everything and have never personally been rugged for a large %age of my portfolio (but have still been scammed/rugged for at least 10k this year lmao). You have to approve tokens to smart contracts all the time as standard procedure, but all it takes is a slight exploit in the background that allows a proxy contract to swap the logic somewhere and that approval can lead into wiping your entire account clean in an instant, and a hardware wallet will not save you here because you approved it!
And these risks are not rare either - quite literally happen every week, for tens of millions of dollars vanished into the ether https://www.rekt.news/ Just trust me, if you don't know exactly what you're doing, you're going to end up getting rugged lol
But yes in theory, it's infinitely better to stake your money as the returns are out of this world.
edit: oh don't get me started with tax risk either lool. I am properly structured and secured but there are such things as "tax attacks" on defi where a specific protocol/coin is designed to maximise your tax bill and bankrupt you because the IRS interprets tax in a certain (outdated way) that causes you to become a paper billionaire and realise that tax but in fact you didn't make anything
Hmm, thanks for answering my questions. It seems like even if this crypto "staking" thing is not a scam in itself, it's not much better if it comes with a lot of risk of being scammed.
Staking is definitely not a scam, but it can be a scam with a lot of risk behind even if it isn't a scam.
If your friend wants minimum risk to earn interest on crypto, he/she can simply put them in celsius/youhodler/nexo etc Some exchange has staking/earn wallet as well. Some also offers a liquidity pool and he can have a feel how it all works out.
I'm always a not your keys not your coins kind of person
If you're serious about staking then learn the hard way and just get metamask, start using Ethereum for its intended purpose, and start researching protocols one by one (like shoving your money on aave or curve to start with) and start building up you knowledge on the space
On July 08 2021 01:26 BlackJack wrote: I've been sweating my friend's investment into a penny stock called DPLS. He put in $8,000 when it was at 1 cent and now it's at 15 cents so he's up over $100k. Pretty crazy.
Update: Despite telling me he wasn't going to pull out until he had "house money" (roughly $1 million where we live), my friend ended up exiting at 0.15 for $100k+ profit. Now the stock is down 50% since then. This guy has been in the zone for a year and a half. He started dating the girl at work he had a crush on for years, he moved out of his parents house and into a new apartment with her, he got into a competitive college program he applied to, and he made $100k off a penny stock. Now he says he is putting $20k into some other bullshit penny stock called "APTY." Once again it looks stupid and crazy to me but the guy has been batting 1.000 so who knows
Sino stocks are back in the green but everyone is forgetting about one of the largest real estate companies in the world. China Evergrande Group, it is taking water from all sides. If it goes Bankrupt there is no way that doesn't send a ripple across the world and maybe even send Sino stocks into the red by association.
On July 08 2021 01:26 BlackJack wrote: I've been sweating my friend's investment into a penny stock called DPLS. He put in $8,000 when it was at 1 cent and now it's at 15 cents so he's up over $100k. Pretty crazy.
Update: Despite telling me he wasn't going to pull out until he had "house money" (roughly $1 million where we live), my friend ended up exiting at 0.15 for $100k+ profit. Now the stock is down 50% since then. This guy has been in the zone for a year and a half. He started dating the girl at work he had a crush on for years, he moved out of his parents house and into a new apartment with her, he got into a competitive college program he applied to, and he made $100k off a penny stock. Now he says he is putting $20k into some other bullshit penny stock called "APTY." Once again it looks stupid and crazy to me but the guy has been batting 1.000 so who knows
If he’s got the hot hand then why not.
Putting 8k into penny stocks is some big ball move. I spread a few hundred over like 10 penny stocks I did minimal DD on. Already seeing 30%+ gains with a few. The scary thing is idk when to pull out, hindsight can be a son of a bitch sometimes. The most logical practice is to exit with ur original investment and just forget about it.
On July 08 2021 01:26 BlackJack wrote: I've been sweating my friend's investment into a penny stock called DPLS. He put in $8,000 when it was at 1 cent and now it's at 15 cents so he's up over $100k. Pretty crazy.
Update: Despite telling me he wasn't going to pull out until he had "house money" (roughly $1 million where we live), my friend ended up exiting at 0.15 for $100k+ profit. Now the stock is down 50% since then. This guy has been in the zone for a year and a half. He started dating the girl at work he had a crush on for years, he moved out of his parents house and into a new apartment with her, he got into a competitive college program he applied to, and he made $100k off a penny stock. Now he says he is putting $20k into some other bullshit penny stock called "APTY." Once again it looks stupid and crazy to me but the guy has been batting 1.000 so who knows
If he’s got the hot hand then why not.
Putting 8k into penny stocks is some big ball move. I spread a few hundred over like 10 penny stocks I did minimal DD on. Already seeing 30%+ gains with a few. The scary thing is idk when to pull out, hindsight can be a son of a bitch sometimes. The most logical practice is to exit with ur original investment and just forget about it.
I think the answer to this depends on if you're gambling or investing. If you're just gambling and trying to hit the jackpot then keep enough money to keep gambling. If you're investing then you have to put in some more work on what peak is reasonable and when you want to pull out with your money.
On July 08 2021 01:26 BlackJack wrote: I've been sweating my friend's investment into a penny stock called DPLS. He put in $8,000 when it was at 1 cent and now it's at 15 cents so he's up over $100k. Pretty crazy.
Update: Despite telling me he wasn't going to pull out until he had "house money" (roughly $1 million where we live), my friend ended up exiting at 0.15 for $100k+ profit. Now the stock is down 50% since then. This guy has been in the zone for a year and a half. He started dating the girl at work he had a crush on for years, he moved out of his parents house and into a new apartment with her, he got into a competitive college program he applied to, and he made $100k off a penny stock. Now he says he is putting $20k into some other bullshit penny stock called "APTY." Once again it looks stupid and crazy to me but the guy has been batting 1.000 so who knows
If he’s got the hot hand then why not.
Putting 8k into penny stocks is some big ball move. I spread a few hundred over like 10 penny stocks I did minimal DD on. Already seeing 30%+ gains with a few. The scary thing is idk when to pull out, hindsight can be a son of a bitch sometimes. The most logical practice is to exit with ur original investment and just forget about it.
I think he's up to around $50k invested in APTY now which is an absurd amount of money to put into a penny stock. The other stock he was going to gamble on was NSAV. I put $1k into it just for fun, so far it has more than doubled.
Its weird to see Robinhood go up since their IPO. I thought the trend for newly public companies were to go down after initial pricing. I suspect the only ones buying RH are day traders and shorters.
On August 02 2021 07:40 Emnjay808 wrote: Its weird to see Robinhood go up since their IPO. I thought the trend for newly public companies were to go down after initial pricing. I suspect the only ones buying RH are day traders and shorters.
Cathie Wood's Ark fund has been buying up Robinhood quite heavily. The fund has also been buying up a ton of Coinbase as the stock continued to go down so not sure what the analysts see but it must be something.
Should be interesting to see how long they are able to hold on to Coinbase, For example, how long the board of Ark Investments are comfortable holding on to an investment that since debut is down by over 25% and never reached its' IPO debut price.
On August 02 2021 19:21 {CC}StealthBlue wrote: Should be interesting to see how long they are able to hold on to Coinbase, For example, how long the board of Ark Investments are comfortable holding on to an investment that since debut is down by over 25% and never reached its' IPO debut price.
They seem to have an iron stomach as they've been holding and continuing to add to their TDOC position even as it's come down 50%. For reference their TDOC position is the second largest holding in their portfolio: https://ark-funds.com/wp-content/fundsiteliterature/holdings/ARK_INNOVATION_ETF_ARKK_HOLDINGS.pdf Though with their TDOC the vast majority was added before the large gain of TDOC in the first place.
$XELA will be interesting next week. I don’t think there’s another security that I have had more confidence in. Almost seems too good to be true. I diverted half my portfolio into it, ready to average down the other half if I have to.
On August 06 2021 07:17 Emnjay808 wrote: $XELA will be interesting next week. I don’t think there’s another security that I have had more confidence in. Almost seems too good to be true. I diverted half my portfolio into it, ready to average down the other half if I have to.
Any particular reason why you think it’s good? I’m seeing a small software company with negative earnings. Its price has been reasonably flat all year, but it’s way off its 5 year high.
Something special about its HR outsourcing service it’s releasing?
EPT
