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By: www.ProfitableInvestingTips.com
https://profitableinvestingtips.com/profitable-investing-
tips/digital-token-liquidity-issues
Liquidity is always an issue in investing and trading. This
has long applied to the stock market but also to real
estate, fine art, and more. Today there are digital token
liquidity issues as well. This thought came to mind
when we saw that a $30 million crypto bid for
Hodlinaut was turned down due to poor liquidity.
https://profitableinvestingtips.com/profitable-investing-
tips/digital-token-liquidity-issues
Hodlinaut is a crypto lender that is in financial trouble.
OPNX is a digital asset exchange that wanted to bail
them out and take them over. The takeover needs to
satisfy creditors and the court. Because OPNX was
going to use just its own tokens in the bailout and
buyout, the deal was squashed.
https://profitableinvestingtips.com/profitable-investing-
tips/digital-token-liquidity-issues
What Is Crypto Token Liquidity?
https://profitableinvestingtips.com/profitable-investing-
tips/digital-token-liquidity-issues
Crypto tokens like Bitcoin and Ether are liquid. Many
altcoins are not. Liquidity in this case refers to how
easy it is to sell something. In the stock market, stocks
like Amazon.com, Apple, or Microsoft sell in huge
numbers.
https://profitableinvestingtips.com/profitable-investing-
tips/digital-token-liquidity-issues
When you buy these stocks you can typically sell them
right away at or very near the current market price.
Penny stocks often do not sell in high volume and
traders can lose their shirts trying to unload these
investments in a falling market. The same concept
applies to rare coins, real estate, fine art, and little-
known crypto tokens!
https://profitableinvestingtips.com/profitable-investing-
tips/digital-token-liquidity-issues
https://profitableinvestingtips.com/profitable-investing-
tips/digital-token-liquidity-issues
Getting Stuck With Illiquid Crypto Tokens
https://profitableinvestingtips.com/profitable-investing-
tips/digital-token-liquidity-issues
When you buy crypto tokens with dollars, yen, or euros,
you would like to be able to change back to dollars,
yen, or euros at some point. You will accept the fact
that crypto values fluctuate. However, if and when you
find out that nobody wants to buy your tokens for a
price anywhere near what you bought them for, that is
illiquidity.
https://profitableinvestingtips.com/profitable-investing-
tips/digital-token-liquidity-issues
There is always a temptation to buy the newest and
shiniest crypto token with the hope that its value will
soar in comparison to Bitcoin or Ether. The problem is
that when you speculate like this you can just as easily
end up with an investment that you cannot get rid of
just a month after you bought it.
https://profitableinvestingtips.com/profitable-investing-
tips/digital-token-liquidity-issues
Why Don’t Creditors Trust OPNX Tokens?
https://profitableinvestingtips.com/profitable-investing-
tips/digital-token-liquidity-issues
Do you remember Three Arrows Capital? This was the
crypto hedge fund in Singapore that liquidated last
year with creditors claiming $3.5 billion in losses. It
borrowed to support its trading losses as crypto winter
sucked the life out of everyone who had bet on crypto
always going up forever and ever.
https://profitableinvestingtips.com/profitable-investing-
tips/digital-token-liquidity-issues
The ripple effects of this crypto business collapse were
responsible for many other business failures as crypto
winter threatened to be a crypto ice age. At the root
of the fears of Hodlinaut creditors is that nobody will
want or trust OPNX tokens issued by the same guys at
the heart of the Three Arrows Capital collapse.
Because no one will want these tokens, they are not
liquid and will be difficult if not impossible to turn
back into dollars, yen, or euros or into other tokens like
Ether or Bitcoin.
https://profitableinvestingtips.com/profitable-investing-
tips/digital-token-liquidity-issues
Crypto Liquidity and Crypto Trading
https://profitableinvestingtips.com/profitable-investing-
tips/digital-token-liquidity-issues
Anyone who pays attention and trades cryptocurrencies
can potentially profit from their efforts. However,
liquidity is an issue here. There is a lot of hype in the
crypto world. Many times what we see happening
resembles the old pump and dump scheme. Somebody
starts hyping an altcoin, the price goes up.
https://profitableinvestingtips.com/profitable-investing-
tips/digital-token-liquidity-issues
They hype it some more and the price soars. That is
when unwary traders buy in. It is also when those who
were hyping the altcoin dump their tokens. What was,
temporarily, a liquid token is not any more and traders
watch the price plummet as they go to sell at greater
losses.
https://profitableinvestingtips.com/profitable-investing-
tips/digital-token-liquidity-issues
For more insights and useful information about
investments and investing, visit
www.ProfitableInvestingTips.com.

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Digital Token Liquidity Issues