3 Questions to ask about our Collateral Hungry world

The federal funds rate refers to the interest rate that banks charge other institutions for lending excess cash to them from their reserves on an overnight basis
Source: BIS Sep 2019
  1. Physical properties are not liquid collateral. Assuming natively digital properties are more liquid, then which digital properties can be good collateral for lenders?
  2. Some cryptocurrencies like Bitcoin, are digital properties and very liquid for the most part. Can they be better collateral than the fixed physical but illiquid properties? And if so, what is the multiple LTV (loan to value) compared to that in the traditional banking system using fixed properties as collateral?
  • The current market failures have taught us that AMMs (automated market makers) will accelerate flash crashes and liquidity crises. I think of these events as the new kind of mispricings that don’t last as long as in traditional markets. However, the ripple effect is different (compared to the central intervening architecture) and has a lasting impact.
  • If all my life is digitized on a dashboard which is updated real time, what is useful data and insights that can become collateral for a loan?

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Efi Pylarinou

Efi Pylarinou

№1 #Finance Global Woman Influencer by Refinitiv 2020 & 2019. Top Global #Fintech Influencer, Futurist, #AI, #Blockchain +: 30yrs FINANCE — https://linktr.ee/Ef