Term of the Moment
e-waste
Definition: leveraged lending
An approach in crypto trading that increases collateral. In the decentralized crypto world, people can borrow tokens but only by putting up collateral. Leveraged lending uses several iterations of lending and borrowing as in the following example. See yield farming.
Lend, Borrow, Swap and Lend Again
Leveraged lending is done hoping that the interest received on lending offsets the interest paid for borrowing. This can be very risky if the collateral tokens fall in value. However, all crypto investments are uncertain depending on the length of time people are willing to stay invested (see hodling). See yield farming.