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Why I have zero faith in crypto venture capitalists

bennettftomlin.com

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Re: Why I have zero faith in crypto venture capitalists

#71

Post by crazygringo »

wyck wrote: post #42
steveBK123 wrote: post #19

I find crypto super interesting and have dipped my toes in with some small real money just to force myself to try out different products. That said, so far, almost 10 years in, there really are not a lot of real world use cases. Sure there are glorified POCs of things that could potentially lead in the direction of real world use cases. But most of these products/tokens are just extremely meta. Tokens you get paid/pa…

This opinion is really common, I used to have it but what changed my mind was realizing there are not really any "real world" use cases. I look at crypto as actual money, with the same definition: "money is a verifiable record that is generally accepted". Money in of itself does not have any "real world" use cases, money is money. Money facilitates economic velocity and growth in the same way crypto does, except cryp…

> except crypto has the potential to be more efficient and secure

Except that's not clear at all.

It's currently less efficient than electronic bank ledgers by many orders of magnitude, in any way you measure -- energy consumption, cost, speed, etc.

And it's paradoxically less secure, as tons of successful hacks/thefts have proven. If my bank gets hacked, I'm still FDIC-insured. The courts will make me whole. Crypto is exactly the opposite.

And there is no indication any of this is changing. Crypto is inherently inefficient because of the need for proof, and for the average person it's far riskier so your money is far less secure in that sense -- and that's inherent too because illegal transactions like hacking and theft can't be undone, by design.

So the use cases of crypto are... not at all clear, except, really, for illegal transactions. Which is why the main real-world use cases, so far, have been... ransom payments, online recreational drug sales, and cross-border transactions. Not even remotely the "banks, financial instruments, and risk management" you're suggesting.

Re: Why I have zero faith in crypto venture capitalists

#72

Post by quickthrowman »

asdev wrote: post #67
steveBK123 wrote: post #19

I find crypto super interesting and have dipped my toes in with some small real money just to force myself to try out different products. That said, so far, almost 10 years in, there really are not a lot of real world use cases. Sure there are glorified POCs of things that could potentially lead in the direction of real world use cases. But most of these products/tokens are just extremely meta. Tokens you get paid/pa…

this was also the case with the internet. the world wide web was just an experiment for a long time. applications and their base layers take time to develop. can't rule it out yet. tokens and shitcoins as get rich quick schemes are detracting from the true innovation imo

> tokens and shitcoins as get rich quick schemes are detracting from the true innovation imo

What are the true innovations in blockchain technology?

Re: Why I have zero faith in crypto venture capitalists

#73

Post by intuitionist »

runawaybottle wrote: post #4

Honestly, all these cryptos have to do is bake themselves into in-game currency for any video game. Fortnite crypto could be a multi billion dollar market. I would love to just buy an army in Starcraft, pillage your base and take your crypto, then sell it on Coinbase. If we are truly to live in a job-less world with basic income, I’m gonna need shit to do.

Why would Epic want to build Fortnite dollars as a slow distributed ledger instead of keeping it centralized? And why would they want to let you redeem for dollars?

Re: Why I have zero faith in crypto venture capitalists

#74

Post by valuearb »

borrowcheckfml wrote: post #29
slg wrote: post #25

Earlier quoted context omitted.

Except those "exotic derivatives, structured products, etc" do have real investments at the heart of them. What is at the heart of those "DeFi" investments? It seems to mostly be criminal and criminal-like behavior (this includes transferring money in ways the local government doesn't approve of which can admittedly be great if the local government is oppressive).

I think it's arguable what real investments are. How "real" is the stock price of Gamestop? Aren't most prices just driven by imaginary narratives? Investors rarely care about dividends. There are also DeFi projects that are based what you call "real investments" such as stablecoins, synthetic assets for stocks and commodities, etc. When the backing/staking mechanism for these works as intended, they are just as real…

The GME stock price is a derivative.

GME stock is a valid contract with a proportional ownership share of all GME tangible and intangible assets.

What crypto has the rights to any tangible assets? Even stablecoins are unaudited.

Re: Why I have zero faith in crypto venture capitalists

#75

Post by the_sleaze_ »

valuearb wrote: post #66
asah wrote: post #55

Earlier quoted context omitted.

+1 - crypto-based lending is an incredibly smooth digital process vs legacy dollar-based lending, which is frankly a nightmare of "wire cutoff deadlines," entering the same info 40 times for 6 people, "security theatre" like call-to-confirm and notary public with people who don't know you and are trusting pieces of paper, etc etc etc

Yep, no deadlines when you don’t do due diligence.

Cute. Please keep this kind of input on Twitter.

Re: Why I have zero faith in crypto venture capitalists

#76

Post by IAmGraydon »

Everyone wants to talk about the future of crypto in terms of how it can be used. Not enough people are talking about the fact that a single breakthrough in computing could undo the encryption that these currencies are reliant upon, instantly driving the value to zero. This is a vulnerability that does not have an analogue in any other currencies, securities or stores of wealth. Because of that, crypto is and will be an extremely high-risk asset to hold. It’s a time bomb. Like all things of this nature, everyone will ignore it until it happens, which means that crypto will be incorrectly priced by markets until then.

Re: Why I have zero faith in crypto venture capitalists

#77

Post by the_sleaze_ »

iSnow wrote: post #28

So basically the first example is of a coin that was never launched and the chart is from some wildcat clone someone else launched. The second one took 3 weeks to reach peg but then did. IDK, I DO think there's too much money flowing into crypto startups lately, but the article is about as poor as the dd of some in the space.

Agreed.

"Why didn't anyone pay attention to me when I @'d them ??? UGH all crypto VCs are bad!!!"

VCs are shady and water is wet.

Re: Why I have zero faith in crypto venture capitalists

#78

Post by DethNinja »

IAmGraydon wrote: post #76

Everyone wants to talk about the future of crypto in terms of how it can be used. Not enough people are talking about the fact that a single breakthrough in computing could undo the encryption that these currencies are reliant upon, instantly driving the value to zero. This is a vulnerability that does not have an analogue in any other currencies, securities or stores of wealth. Because of that, crypto is and will be…

I don’t get this argument especially here in the hackernews;

1. If they can crack the cryptocurrencies then it means that they can easily crack crypto of online banking systems as well, entire world would crash regardless of whichever asset you hold.

2. There are already quantum resistant crypto algorithms, crypto currencies can easily switch to them once it is clear that current crypto algorithms can be cracked. It would mean that people who did transactions between the detection period would probably lose their money but it wouldn’t be the end of crypto currencies.

Re: Why I have zero faith in crypto venture capitalists

#79

Post by smt88 »

cinntaile wrote: post #65
applepple wrote: post #61

Earlier quoted context omitted.

The vast majority of top projects are essentially scams and the real projects are not in the rankings. Even promising projects seem to turn into scams once they get into the top 200 or so. It's as if some wealthy investors buy up a lot tokens from top projects and then threaten the founders to crash the price unless they stop development and start wasting time. I've worked in the blockchain industry for several years…

Don't go and claim the vast majority of top projects are essentially scams, that's just spreading false information.

"Ponzi scheme" is a better way to put it.

Re: Why I have zero faith in crypto venture capitalists

#80

Post by quickthrowman »

artfulhippo wrote: post #17
ralston wrote: post #14

Earlier quoted context omitted.

Was just talking with friends yesterday about this - Internet Computer getting absolutely dumped by the VCs who pumped it so hard from the beginning. Once I saw that they were headquartered in the Bay, had their entire team in the Bay, and wanted to be the “everything for everyone” computer, that was kinda my sign that this was a scam.

Internet Computer aka DFINITY is not a scam. The price action is fishy, but when you investigate the project’s vision, the technical architecture, the team behind it, and the community building on it, you’ll discover that it’s perhaps the most serious, innovative, and ambitious system out there.

How large are those bags you’re holding I wonder?
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