Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Bankers Ditch Fat Salaries to Chase Digital Currency Riches

bloomberg.com

Post reply on HN
Print view View original

71–80 of 150 posts

Re: Bankers Ditch Fat Salaries to Chase Digital Currency Riches

#71

Post by cableshaft »

aaron-lebo wrote: post #55
richardknop wrote: post #42

Investing in crypto is like a gambling addiction. I know some people who were paper millionaires based on their BTC during the days before Mt Gox collapse. They lost their entire savings once Mt Gox collapsed, since then they have spent years working hard to recover their savings and now they are investing all of it in ICOs. This won't end well. Seems to me like the story is repeating. On a side note, the brigading/s…

It's insidious. There are routinely four or five posts on the front page about cryptos and they usually lack substance. It seems like an entire industry with a lack of morals, ignorant about law and too often tech, but with the smug self-assuredness that they are on the verge of changing everything as only 20 somethings and extremists possess. It doesn't really bother me that people are dumb, but it's not cool when y…

You get in early enough, and you'll pretty much be always be up on your investment. I got in on Ethereum the day the announcement popped up on Hacker News that it was added to Coinbase, and the price per coin was $11 then. Even after it's massive 50% crash from it's peak, it's sitting at $200 a coin right now. That's still up almost 20x.

That being said, I didn't have a ton of money to invest at the time, so I'm not rich or anything, and I tend to be a long term holder, but I highly doubt it's ever going to get all the way back down to $11 a coin.

I could have bought Bitcoin when it was $4 a coin, as I was paying attention to it back then, although the infrastructure for it wasn't in place and it was really difficult to buy, so I gave up on it. If I had, I would have made 625x whatever I put into it by now. And Bitcoin is not likely to ever get back down to $4 a coin. There will be buyers for sure if it ever gets that cheap (or the landscape will have changed so obviously that I probably would have sold a long time ago).

Re: Bankers Ditch Fat Salaries to Chase Digital Currency Riches

#72

Post by cesarb »

zimpenfish wrote: post #70
VMG wrote: post #69

Earlier quoted context omitted.

> How it'll do any of that and why it's a good thing, that's left as an exercise to the reader. I'll give an additional hint to reader: who benefits from encryption that even law enforcement cannot break? Who benefits from TOR?

> who benefits from encryption that even law enforcement cannot break? People who live in countries with regressive regimes where law enforcement can be legitimately dangerous?

Also, law enforcement isn't all-powerful. If law enforcement can break it, criminals can break it too.

Re: Bankers Ditch Fat Salaries to Chase Digital Currency Riches

#73

Post by Jabanga »

hendzen wrote: post #47
phkahler wrote: post #35

Earlier quoted context omitted.

In the end, the continually growing computational requirements to maintain the ledger become infeasible even for the ASIC folks and the currency dies. It's all a ponzi scheme.

It's a hyperponzi. A ponzi combinator. As much as I find the actual technical details of blockchain technology interesting (it's basically nerd crack) - the severe lack of utility to general society and the constant price bubbles are really astounding. There are multiple levels of bubbles... the short term ethereum-led ICO bubble we are currently in, which is kind of overlaid on top of the long term bubble of cryptoc…

I think the blind spot in your analysis is that you assume the rest of the financial industry is not like this. Cryptocurrencies are just doing rapidly what other stores of value did gradually over the course of centuries. Gold for example gets almost all of its value from speculative interest. This extends to some degree to the collector art and rare wine markets as well.

I also think you're failing to appreciate the benefit of having technologies that allow for a viable grey market. A third of people born today do not have government identification [1], and therefore cannot participate in the legal identity-based financial system. To increase their participation, the "crime" of unregulated commerce has to become more frequent in many countries.

In countries like Venezeula, cryptocurrencies are starting to play a role as a secure (by Venezuelan standards) safe haven for their wealth [2]. All of this activity is criminal according to the Venezuelan state, yet it is undoubtedly beneficial to Venezuelan society, in preventing corrupt state apparatuses from expropriating and squandering the meager private wealth of Venezuelans through hyper-inflation.

It also doesn't take much imagination to envision a future where tokenised finance on the blockchain helps millions of entrepreneurs around the world better access global capital markets. Speculation, which has created a token market worth billions [3], is just the first use-case enabled by this technology to conduct much more frictionless financial transactions. There will be more. I would also argue that this speculation, as chaotic as it is, is helping to bootstrap the industry, just as the dot com bubble did for the internet sector in the late 1990s.

So while I do think there is an enormous amount of hype in the cryptocurrency market, and that many will suffer losses from making bad investment decisions, I think this needs to be put in the context of the speculation underlying the value of major traditional assets, the promise the technology holds beyond speculation, and the capabilities it is already proving to have.

[1] https://twitter.com/NickSzabo4/status/544994985414639616

[2] https://www.bloomberg.com/news/articles/2017-06-15/venezuela...

[3] https://coinmarketcap.com/assets/

Re: Bankers Ditch Fat Salaries to Chase Digital Currency Riches

#74

Post by VMG »

zimpenfish wrote: post #70
VMG wrote: post #69

Earlier quoted context omitted.

> How it'll do any of that and why it's a good thing, that's left as an exercise to the reader. I'll give an additional hint to reader: who benefits from encryption that even law enforcement cannot break? Who benefits from TOR?

> who benefits from encryption that even law enforcement cannot break? People who live in countries with regressive regimes where law enforcement can be legitimately dangerous?

That's one of groups, correct.

Who benefits from a financial transaction system that law enforcement cannot censor?

Re: Bankers Ditch Fat Salaries to Chase Digital Currency Riches

#75

Post by VMG »

chvid wrote: post #28

I remember the .com-bubble; it kind of made sense that companies like Amazon were very valuable as they had the promise to transform whole industries. But this one; it is just stupid. Massive amounts of electricity and hardware wasted to keep a distributed ledger safe; an army of computer nerds facilitating fraud, narcotics sale and money laundry; and finally the bankers sensing bucks to be made on a large number of…

One the one hand, you list a number of non-speculative use cases, on the other hand, you call the capital investments wasteful.

That tells me that your judgement of the wastefulness is subjective. Other people obviously derive value from it.

Re: Bankers Ditch Fat Salaries to Chase Digital Currency Riches

#76

Post by SippinLean »

richardknop wrote: post #42

Investing in crypto is like a gambling addiction. I know some people who were paper millionaires based on their BTC during the days before Mt Gox collapse. They lost their entire savings once Mt Gox collapsed, since then they have spent years working hard to recover their savings and now they are investing all of it in ICOs. This won't end well. Seems to me like the story is repeating. On a side note, the brigading/s…

>the brigading/shilling here on HN is becoming quite annoying

Can you point to a single post where the top, say, 5 comments aren't completely negative toward crypto as a whole? They typically mention gambling, fraud, ponzi schemes and (like yours) Mt Gox, in a rant that isn't specifically tied to the post at hand. Look at the top comments on this article:

>Investing in crypto is like a gambling addiction

>cryptocurrency is the new Gold Rush

>I remember the .com-bubble...But this one; it is just stupid

>It's hard not to think of tulips

If the shills are out there, they must not be getting paid very well.

Re: Bankers Ditch Fat Salaries to Chase Digital Currency Riches

#77

Post by cableshaft »

richardknop wrote: post #57
aaron-lebo wrote: post #55

Earlier quoted context omitted.

It's insidious. There are routinely four or five posts on the front page about cryptos and they usually lack substance. It seems like an entire industry with a lack of morals, ignorant about law and too often tech, but with the smug self-assuredness that they are on the verge of changing everything as only 20 somethings and extremists possess. It doesn't really bother me that people are dumb, but it's not cool when y…

I know exactly about the pull you are describing. I also invested a small amount (around £1500). When I lost about 1/3 of my initial investment, I felt a really strong urge to deposit more cash and try some risky trade to make my losses back. I guess this is the feeling gamblers have. I managed to use my will power and cash out my remaining investment and just stay away from this as I understand now how it can become…

When did you invest, and why did you feel you needed to sell it off so fast? I bought some bitcoin when I thought it had reached the bottom at $800 a couple years ago, but I was wrong and it kept sliding all the way down to $250 a coin (and stayed that way for a year and a half, that was rough to see the price every day, I eventually stopped watching it for about six months), but I held on to it, and the current price is ~$2500.

Like take the stock market downturn that happened in 2008. People who sold lost their shirts, but people who held onto it for a few years saw the market completely rebound and reach even more all time highs.

I'm not saying it's always smart to have this behavior, and there was a period where it looked like Bitcoin might not ever recover in price, but if you only invest what you can afford to lose (and I have, I could lose everything I invested and I'd be sad but not destitute), then you should be able to weather these storms.

Re: Bankers Ditch Fat Salaries to Chase Digital Currency Riches

#78

Post by jondubois »

cm2187 wrote: post #61
jondubois wrote: post #59

Earlier quoted context omitted.

Maybe, but tulips still cost something these days. I think the same will apply to tokens. They will always be worth something so long as banks keep charging transaction fees for moving money around and so long as a reliable network exits to support the token. Even if you assume that nobody wanted to hold Bitcoin for longer than a few minutes (long enough to complete a transaction), it would still have value because i…

Actually you can't create an unlimited of tulip. I can create an unlimited number of block chains.

Maybe, but you can't create an unlimited amount of computers.

That's why ICOs are valuable; they add transaction processing capacity to the overall network (which encompasses all cryptocurrencies) or at least shift transaction processing capacity away from Bitcoin (E.g. when bitcoin miners are re-purposed to mine other more efficient Altcoins).

The limited supply of tokens doesn't matter. The real underlying value is driven by the limited supply of machines which process token transactions. If all machines and all consumer attention suddenly shifted to a different Altcoin, then Bitcoin's value would drop to zero and that other coin's value would skyrocket.

Re: Bankers Ditch Fat Salaries to Chase Digital Currency Riches

#79

Post by cableshaft »

richardknop wrote: post #68
cableshaft wrote: post #64

Earlier quoted context omitted.

I know Mt. Gox made it difficult to withdraw your money/coin from the exchange near the end, but they learned a hard lesson not to keep their coins sitting on the exchange (I sympathize, it's something I struggle with too periodically, it's just so easy to keep it sitting there). The digital currency landscape is still in kind of a 'Here be Dragons' unmapped territory situation. No one knows exactly where it's going…

Most of these ICOs that I have read about have no reason why they need their own token. They could use existing blockchains but they introduce a custom token just to grab some free money from this ICO craze.

Totally agree. That's why I haven't thrown any money at any ICOs and I probably won't for quite some time, if ever.

Re: Bankers Ditch Fat Salaries to Chase Digital Currency Riches

#80

Post by cableshaft »

philbarr wrote: post #10

So cryptocurrency is the new Gold Rush. As the story goes, the only people who reliably made money during the original gold rush was the people who sold the spades. What are the "spades" here?

Exchanges are the spades, mostly. The ones who charge a small fee on every exchange. They get money from people whether they're buying or selling, no matter what the price is.
Post reply on HN