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A comment on The SEC has told us it wants to sue us over Lend. We don’t know why. Parent comment

Re:The SEC has told us it wants to sue us over Lend. We don’... by pjc50 on Wednesday September 08, 2021 @09:22AM (#28456587)
> many borrowers do not care about the coins they put up as collateral.

Oh, you can use "shitcoin" X as collateral for a loan in "stablecoin" Y? Can the borrower then selectively default if the X/Y exchange rate moves in their favor? In which case this is just a funny-looking option.

> holders of paper gains exiting with debt to avoid taxable events

A similar scheme was used to evade income tax in the UK with "loan forgiveness" for a while, but was ruled unlawful. I suppose the more crypto steps you put in the harder it is to trace.

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Re:The SEC has told us it wants to sue us over Lend. We don’... by thebean11 on Wednesday September 08, 2021 @10:33AM (#28457619)
> Can the borrower then selectively default if the X/Y exchange rate moves in their favor?

They very much can. For that reason though, the loans are always over collateralized so defaulting involves leaving some money on the table. That money could be less than hypothetical tax payments though..not sure.

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