Why what happened to FTX and FTT is impossible with Hive and HBD!

Alameda Research and FTT

First what happened to FTX and FTT, and subsequently Alameda Research. The CoinTelegraph did some research and found out that in the second quarter of this year, Alameda Group was overleveraged and got essentially "bailed out" by FTX, by getting a collateral of 173 million USD worth of FTX. That was necessary because, Alameda Research was involved in the ICO of FTX from day one. Alameda was the recipient of 4 billion USD worth of FTT from day one. So, FTX had no other option than bailing out Alameda last quarter, or they would go down with them.

This is all very interesting, but also quite concerning. Because it proves once again, that big firms like Alameda Group, FTX, and others are really bad at risk management. And with assets like crypto, that are sure considered as risk-on assets, that is just key.

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CoinTelegraph video

Why Hive and HBD is safe

Well, here comes the risk factor into play. Hive and HBD are hugely decentralized. Of course there are whales that can dump into the market and make the price of Hive tank. But that won't bring other "companies" or "firms" down. And HBD surely can't bring Hive down either, as it is written into the code that only 30 % worth of Hive can be minted into HBD. That was 10 % before, but even 30 % is not possible to bring Hive down. Even when we would assume that the entire stack of HBD would be in one account's hands, it would be possible to tank HBD, but nothing more than that.

So, what have we learned from this? Do your risk management and do it well!
This is key in this market, and it is a true shame that such large capitalized companies don't manage to do that.

Sincerely,

Pele23

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Posted Using LeoFinance Beta



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5 comments
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What if all HBD were on one account, converted to HIVE and then powered up to participate in witness voting?

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That would only be 30 % of all Hive, which is a lot, but not enough to make Hive collapse in my opinion

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What a shit show, right? It's somehow proving "how fake" most of the dollar valuations in crypto are. It will take a while until we get out of this mess.

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Shit show is the least you can say, utter incompetence from the biggest firms in this trade. Amateurs

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I also think Hive and HBD will be safe. At least the witnesses will make sure the interest rates don't go out of hand and there isn't enough HBD to really affect the price of Hive that much.

Posted Using LeoFinance Beta

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