If you can’t see that is good collateral by now, then you are choosing to be blind.
It is indeed a leverage machine, and that is a valuable thing.
But FWIW, assets designed to appreciate in value, be they capital assets or commodity monies, are naturally suited to serving as collateral and being leveraged👇
Skeptics of collateral and leverage machines rightly point out that they can become fragile and implode, and historically have.
But such skeptics fail to acknowledge the capital efficiency of leverage.
Leverage can be incredibly useful, and is not going away, it’s only being improved.
Superior asset tracking, near real-time pricing, and automated liquidations are qualities that make #blockchains capable of scaling-up and scaling-down leverage much faster than meatspace systems.
So yes, Ethereum is a leverage machine, and that is a valuable thing.
We will see it suck in billions++ more in collateral, and other layer-1s attempt similar strategies.
Will it go through many more cycles of levaraging and deleveraging?
Naturally. All of life is cyclical.
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