if i had 10 cents for every arb I've seen...

[Lucas_Paul]

It's possible at the retail level, but you have to have enough equity to support the loan collateral. If you have 15MM+ you can do it. There are more than a few people on this site who are retail guys trading that big.

everyone can take a margin loan with a margin account with enough collateral, this isn't the discussion.
We're getting off topic here.

OP said he'd rather take a 100m loan at @ 3% (floating) to stake into a 10% yielding (crypto or smth) project instead of buying outright underlying (crypto ccy) for 100k. Now, I really wanna see that happening

Not to mention the absurd of comparing 100m with 100k. As if 100k collateral would get you that 100m.

and please dont compare eurodollar margins to crypto margins (this is to whoever posted that, cant remember)

 

[newwurldmn]

everyone can take a margin loan with a margin account with enough collateral, this isn't the discussion.
We're getting off topic here.

OP said he'd rather take a 100m loan at @ 3% (floating) to stake into a 10% yielding (crypto or smth) project instead of buying outright underlying (crypto ccy) for 100k. Now, I really wanna see that happening

Not to mention the absurd of comparing 100m with 100k. As if 100k collateral would get you that 100m.

and please dont compare eurodollar margins to crypto margins (this is to whoever posted that, cant remember)

I think @MrMuppet ’s point is that he would rather trade much bigger in a “arb” than trade a directional view smaller.

 

[MrMuppet]

everyone can take a margin loan with a margin account with enough collateral, this isn't the discussion.
We're getting off topic here.

OP said he'd rather take a 100m loan at @ 3% (floating) to stake into a 10% yielding (crypto or smth) project instead of buying outright underlying (crypto ccy) for 100k. Now, I really wanna see that happening

Not to mention the absurd of comparing 100m with 100k. As if 100k collateral would get you that 100m.

and please dont compare eurodollar margins to crypto margins (this is to whoever posted that, cant remember)

As I already said: This is completely doable.
For cryptostuff, establish bilateral creditlines with your counterparties, post collateral to a 3rd party clearing service such as fireblocks where your counterparties are onboarded as well. Negotiate your loan conditions OTC.
When you have excess cash, you can lend it out as well...

There is a market for margin out there just like there is a market for equities. That is true for TradFi and crypto. TradFi is harder to get access to but it's also doable.

The simplest way for you pikers to get access to that is the margin book on FTX.

Because the only kind of loan you know is the consumer/mortage loan you get from a bank you probably confused those with a 100m consumer loan at 3% floating^^

And just by the way: 100m buying power for 100k collateral is not an issue...definitely not

 

[Lucas_Paul]

I think @MrMuppet ’s point is that he would rather trade much bigger in a “arb” than trade a directional view smaller.

i know.

my "problem" was the risk asymmetry here, thats all.

And there's a relationship between an underlying direction and an existing arb provided by that underlying. "Arbs" (big enough for retailers to benefit) are there for a reason.

but, all good. I have no desire to argue. Cheers.

 

[Lucas_Paul]

Because the only kind of loan you know is the consumer/mortage loan you get from a bank you probably confused those with a 100m consumer loan at 3% floating^^

a loan is a loan no matter who gives it or how it's named.
A loan with a negative yield is also doable. You just need to find a willing counterparty.

And just by the way: 100m buying power for 100k collateral is not an issue...definitely not

Depends on the underlying's volatility. The lower the volatility the lower the margin req.
It's probably an issue for a crypto project with a 10% yield, tho.

 

[MrMuppet]

a loan is a loan no matter who gives it or how it's named.
A loan with a negative yield is also doable. You just need to find a willing counterparty.

100% correct.

Depends on the underlying's volatility. The lower the volatility the lower the margin req.
It's probably an issue for a crypto project with a 10% yield, tho.

Disagree here. When we're talking about bilateral loan agreements Depends on the individuals default probability which is tied to the strategy and not to volatility.

Imagine you approach a lender. 15 years live track record, 3 losing months overall, your strategy is neutral gamma and long tails, inventory is small and always squared off overnight and you have a detailed strategy description and a business plan. In other words you're a money making machine and you've proven it.
Big loan, reasonable interest rate, low collateral requirements.


On the other side, you trade equities long/short intraday for 3 years, most of your months are +/- 0 or up small, 5 losing months per year and in two months you were up 30%. Your strategy is reading the news and drawing lines on a 5min chart.

Even if you overcollateralize your loan, nobody would give you a cent

 

[destriero]

Yeah, bc everyone is falling over themselves to loan you size to short what amounts to CDS on some shitcoin. It's all worked out so awesome in the recent past.

 

[JackMorgan]

staking is a complete scam and always was.
obvious too.

 

[MrMuppet]

Yeah, bc everyone is falling over themselves to loan you size to short what amounts to CDS on some shitcoin. It's all worked out so awesome in the recent past.

still doing it. Due diligence is key. As long as you're not involved in "prime brokerage" which is lender, market maker, custodian and clearing house at the same time, you're fine.

If you're stupid enough to pay 3AC so you can use their account for cheaper commissions you probably deserve to lose it all.

 

[MrMuppet]

staking is a complete scam and always was.
obvious too.

Here's a participation medal for the most out of context comment competition.

Seriously, pal. If you don't start being funny again, I might have to block you