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how do these loans affect price if they are not rehypothecated? i'm seriously considering a loan just to avoid tax reporting... i'm really worried about how to report taxes for selling BTC to pay bills. it seems worth it to pay 10% to someone else for a year just to avoid figuring out how to accurately report taxes.
2025-12-04 12:38:27 from 1 relay(s) ↑ Parent 1 replies ↓ Reply
They use the bitcoin on the balance sheet to play in the futures market. They call it hedging but in reality they are shorting the future price of bitcoin thus why I call this move paper btc or naked shorts. As they don't actually have the "physical bitcoin" but they do have a balance sheet with the representation of that said bitcoin... I can't advise you on what to do but just know that this was a very stressful situation when I had one of those loans. They start as 5% of your holdings but quickly become 50% or more as you have to keep on adding collateral in order not to get liquidated
2025-12-04 14:04:53 from 1 relay(s) ↑ Parent 2 replies ↓ Reply
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2025-12-04 14:34:37 from 1 relay(s) ↑ Parent 1 replies ↓ Reply