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I was just trying to make up some sort of example where you can gain income by holding on to someone's collateral. I wasn't trying to say how something typically works.


That isn't how collateral works, so you really are just making stuff up. If you did start doing this sort of thing as a bank you would attract regulatory attention pretty quick.


You're basically talking about reypothecation[0]

[0]: https://www.investopedia.com/terms/r/rehypothecation.asp




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