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Re:Two thought experiments to evaluate automated stablecoins by SilasX on Thursday May 26, 2022 @04:04PM (#31522756)
But by borrowing against the collateral (in this manner), you get some optionality along with the collateral's upside: if it crashes, you get to keep the amount you borrowed[1], thus hedging the loss. Plus any interest earned on it.

[1] Depending on the stablecoin's dependencies you might want to have converted it to dollars outside their platform first.

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