https://web.archive.org/web/20230705092143/https://twitter.com/spiro___/status/1676093195007021057
https://twitter.com/spiro___/status/1676093195007021057
this is the second time I'm hearing about an elon company liquidating apes
This will never stop being funny. What makes it funnier is the fact that an average nft buyer is exactly the kind of person who sincerely believes that poor deserve to be poor for their bad financial decisions.
Know a guy who apparently put 5k on a credit card to buy some shitty alligator and kangaroo drawings and then didn't sell when his collection was priced at like 90k, likely because people were telling him to hodl and he's one of the most gullible people I've ever known.
I want to help, we should all be extending hands to help right now.
And no one was helped
Possibly. What they were definitely doing was using apes as collateral for loans.
Without a police force, the only type of loan a bank can safely offer is a fully-collateralized loan. With fungible currencies this is used for leverage.
- The price of Eth is $2000
- You take out a $1500 loan by putting up 1 Eth of collateral
- You buy 0.75 Eth with the $1500
This can go one of two ways:
- The price of Eth climbs to $2500. You sell the 0.75 Eth for $1875, pay back your $1500 loan, and end up with 1 Eth and $375 for a total value of 2875. A 25% price increase leads to a 43% increase in portfolio value.
- The price of Eth drops to $1500. The bank would lose money if they held onto your collateral for any longer (because you're not gonna pay $1500 to get back Eth that's worth less, and there's no way they can force you to), so they sell it for $1500. Your 0.75 Eth is now worth $1125. A 25% price decrease leads to a 43% decrease in portfolio value.
With the apes specifically
- They're nonfungible and therefore useless, but owners still want to get additional returns in the various crypto finance casinos. So they borrowed fungible cryptocurrency by putting up the apes as collateral
- Some of them presumably bought more apes with the loans
- When the bank starts selling apes because prices have gone too low, this has a funny tendency to further depress the price of apes
RIP racist totenkopf jpeg owners
You can apply multiple slurp juice points per ape loan to get a discount on interest.
To be fair, the joke is also on anyone who allowed their borrowers to use a jpg as collateral. They aren't going to be able to recoup their losses either.
oh no, they will. these are overcollateralized loans. I loan you $2k for your monkey picture worth $3k, and if the price drops to $2500 I sell your collateral and you're fucked
Imagine still being part of this sphere. Are the celebrities still there?
Naw the celebs who hawked it got their paychecks and bounced. They have enough money for actual financial advice.
Even the E-celebs, AFAIK, minted their own allegedly valuable NFTs and just... couldn't do anything with them.
liquidate the 
