
QuadrigaCX CEO allegedly traded millions in fake funds to fund luxury lifestyle - benmunster1
https://decrypt.co/7533/quadrigacx-ceo-traded-millions-in-fake-funds-to-fund-luxury-lifestyle-alleges-trustee
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endorphone
"Margin trading is akin to gambling"

It is no more akin to gambling than simple trading is akin to gambling. The
only difference is that funds are also borrowed, which in this case means it
was borrowed plus fraudulently obtained funds. And he was likely extra
desperate, as most pyramid schemes usually are, taking extra risks because he
really needed to make it whole again.

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Sahhaese
(high) Margin trading isn't just gambling, it's _borrowing_ to gamble, which
is a crazy idea.

Gambling debt wasn't even enforcable in this country until recently because
lending people money to gamble with is fundamentally wrong.

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wickoff
There is no debt on good exchanges that offer crypto derivatives. Exchanges
automatically close your positions when your margin balance nears zero. The
best one - bitmex.com - has a 250 million insurance fund to cover the
potential losses in case the price action becomes too volatile and there is
not enough liquidity to close out everyone's positions in time.

Everything is seamless for the user, they don't even need know how leverage
works, it's no different from trading on any other exchange.

~~~
Sahhaese
You're right, in that situation you're not borrowing from others, you're
borrowing from your own capital.

That said, it is a little different, because without margin you can ride out
any position, but with margin you get margin called (liq'd) at increasingly
smaller deviations.

Or in another view of it, it does the equivalent of turning low-return 1:1
odds into high return 100:1 odds which further attract problem gamblers.

Watch the rekt bot for a while and tell me that there aren't a lot of problem
gamblers on mex.

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puranjay
Crypto is filled with scammers and until these vultures are removed from the
ecosystem, the field will remain a joke

~~~
Bakary
The deeper problem is that most people want to amass crypto and get rich from
it, and only a minority want to actually use it as a currency or for some
heartfelt ideological reason.

As a corollary to that, you also have an army of people who are driven to
madness because they didn't get to cash in, and seek to undermine crypto in
the hopes of healing those gaping mental wounds. But it doesn't change the
fact that the masses who drove the prices up wanted it to be a pyramid scheme
in which they were the winners.

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puranjay
These crypto hoarders and traders are also the people keeping crypto from
being used as a currency. You can't buy/sell things in a currency that
fluctuates several percentage points in a week.

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woah
This is simply the consequence of a thinly traded asset whose value does not
have any real world dividends to anchor it.

If the hoarders and traders disappeared, the volatility would be due to other
more inexplicable market mechanics.

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AMerrit
This whole QuadrigaCX saga has certainly soured a lot of people on crypto here
in Canada.

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dleslie
It was an awful exchange. I waited a month for Canadian funds to be
transferred out and it never happened, eventually covered back to Bitcoin and
now it sits in a wallet somewhere.

