People keep telling me to create a Tesla Finance trading account using a diversified basket of consumer finance loans to trade with on the understanding these are qualifying structured products. These often rely on algorithmic trading bots to generate value.
But many crypto exchanges have terms and conditions about lock-ins and min buy-ins, a bit like the Wild West of the internet you can strike gold but mostly you will be panning with dirt. In this post I clear up some of the myths about crypto-denominated money investment products
VAT prepayment riptides
Swimming in the sea, you need to be careful of riptides which can pull you under. Similarly with “VAT prepayment” scams, you can get dragged under some hovernet and be locked into a position where you think you have autonomy but that is just an illusion. The merchant promises you a commission for bulking up their order book, and although they promise you a full refund you can lose your initial deposit.
No such thing as self-sovereignty
Self-sovereign wallets, so-called to present the facade of custodianship over your digital wallet, can act to lock you into a crypto trading position where the only option is to keep increasing capital inflow until the investment adviser (not operating under FCA Financial Conduct Authority supervision), opens the gate when they, not you, are able and willing to release your funds.
Proof-of-stake is value-at-risk
You can be put under a lot of pressure to “lock down” your funds but it often feels like depositing into suspect trading platforms, even where you have proof-of-stake in the underlying protocol i.e. your position was purchased and secured by Ether holdings transferred using the Polygon Network, that the system is designed to operate a bit like an online slot machine, where you are conceded a series of small wins, or payouts, until the system wipes out your funds on the grounds you have “insufficient funds” to place the next trade in your order book.
And you need to input double the deficit which has been created in order to liquidate your “frozen assets” in USDC and restore your crypto balance. The initial buy-in and exit from the crypto carousel is usually tendered in one of the stablecoins, USDC or other, yielding the perception of stability where a Bitcoin buy-in would be subject to daily volatility rates.
“Double your losses to double your profit”
The “double or nothing” play is a common one used by several red-hat SEO schemes and these so-called “commercial trades” can occur twice or three times in a trading round, and never fail to find an excuse to “freeze” your assets i.e. the capital you have deposited on the platform which require increasingly large amounts of additional capital to “unlock the gate”.
Brightsides.uk 