Other Peoples Money

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Hedge funds lose money all the time as they hedge their bets by covering those bets. What if their cover is also a risk and they have no real cover and everything becomes one big loss?

I was reading @mawit07 post earlier today and it seems the big players in Crypto lending are in trouble as it was stacked like a house of cards. Many of the hedge funds and institutions were overlapping each other. When one big lender goes then the others are so intertwined with each other they are all affected. Only the ones with the deepest pockets will be left standing.

Kind of crazy and very much a wild west type of approach as there is no cover for investors as basically they were all covering each other. This is simply foolish as it is great when all things go well but when things turn like the price of Crypto has then everything collapses.

I have never heard of Three Arrows Capital who have been liquidated or 3AC before, but know of Genesis and BlockFi who are owed hundreds of millions and are likely to see nothing back. That would have been fine last year when the prices were higher, but paying out millions of dollars via crypto means you are actually paying out far more and in some cases with Bitcoin would be 2-3 x the difference.

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Ardana's main investors.

Two names clearly jump out here one being Three Arrows who have been liquidated and the other Justin Sun. DeFi has a long way to go yet and yes there will be fortunes made and lost as not every project is stable.

There are many Crypto projects besides the lending side caught up in the shambles. Ardana a Crypto project on Cardano dealing in DeFi had Three Arrows as their biggest investor. Those tokens could end up being dumped if whoever picks up the pieces from Three Arrows sees no long term value.

Crypto is still in it's infancy and this is what is seriously wrong as these companies are literally gambling with everyone else's money. We saw Luna collapse and the collateral damage that has caused as there is still fall out happening. So many got caught up in a Ponzi scheme that was so obvious.

This is all playing into the SEC's hands and they couldn't have asked for a better situation. This is all self inflicted by sheer greed and stupidity which go hand in hand in this case. Business models need to work no matter the price as you cannot have it only when the markets are booming. In Crypto there is more red days than green and this is what they should have been prepared for. What is your Plan B or C as Plan A clearly went pear shaped in a hurry.

This is very sickening to read as how many people have lost fortunes in this type of investment scam as that is what it is as it is clearly not a legitimate investment.