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$3B in Bitcoin was sold in a last-ditch attempt to save UST from collapse

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Re: $3B in Bitcoin was sold in a last-ditch attempt to save UST from collapse

#461

Post by _carbyau_ »

nwiswell wrote: post #349
seoaeu wrote: post #276

Earlier quoted context omitted.

You have it backwards. The trillions of tokens were created because people lost trust in it. Specifically, the loss of trust instigated the price drop from $1 to ~98¢. That's what started the collapse. Only afterwards did the "death spiral" of minting of more tokens, which degraded trust, which decreased the price, which drove more minting, etc. happen

It's chicken and egg. People lost trust because they knew people losing trust would cause a death spiral, and they wanted to get out before everyone else. It was a fire in a crowded theater. Bitcoin depends on trust, yes, but there's no Damoclean sword like there was for Luna. Some people losing confidence does not necessarily lead to others losing confidence.

Like toilet paper in a COVID pandemic... people were acting not because of the item itself, but because they knew how "the crowd" would react - a self-fulfilling prophecy.

Re: $3B in Bitcoin was sold in a last-ditch attempt to save UST from collapse

#462

Post by Spivak »

lamontcg wrote: post #435
ryathal wrote: post #279

Earlier quoted context omitted.

I think there are going to be two periods remembered in 2008-2022. The 2008-2012-15 where interest rates were made low to prevent a depression and it worked. The the 2012-15-2022 period where interest rates were kept abnormally low because politicians didn't want to be blamed for hurting the stock market causing a bubble that pops when interest rates are forced to rise.

Nope, the fed will crank up short term rates and crater the economy to tamp down wage inflation. That will invert the yield curve and long rates (>10 years) will still remain historically low and disinflationary. And they've been playing this game since the 90s and the Greenspan fed did it first a blew up the housing bubble that popped in 2008. This cycle goes beyond the memories of Millennials. It just keeps getting…

This is the bit that makes me so angry. Wages lag behind commodity prices and the correction always happens because businesses complain about labor costs (“muh jobs” despite us being at near full employment) and don’t let them catch up to CoL.

It’s infuriating how much the game is rigged against laborers.

Re: $3B in Bitcoin was sold in a last-ditch attempt to save UST from collapse

#463

Post by hw »

eric_cc wrote: post #75
shkkmo wrote: post #73

Earlier quoted context omitted.

> Too many people falsely equate "Bitcoin === Crypto".. or "a fan of bitcoin is a fan of all crypto". > So I'd bounce this back to you: How is Luna's Ponzi crash NOT good for bitcoin? Doesn't the first line answer the second?

> Doesn't the first line answer the second? To be clear, you're suggesting: "because people are uneducated about bitcoin and crypto, when one project fails they will incorrectly connect it to bitcoin. And that's bad for Bitcoin." These events are great opportunities to educate ignorant people. > 0 such ignorant people will learn more about bitcoin and why it's not like crypto like Luna. Greater education is extremely…

So you’re saying, because bitcoin does not have a monopoly on crypto, people are not forced to only buy bitcoin and as bitcoin holders you obviously want that

Would also be nice if the only stock in the stock market was AAPL and no other shit stock with no profit.

Re: $3B in Bitcoin was sold in a last-ditch attempt to save UST from collapse

#464

Post by Spivak »

arcticbull wrote: post #331
mcguire wrote: post #323

Earlier quoted context omitted.

" If the hikes play out, we'll land around what, 2-3% for the fed funds rate? That's low, historically. " But it's not the 0.1% that drove money out of other asset classes (i.e. bonds) because they couldn't generate any returns.

Do you really see folks broadly moving from risk assets to a 2-3% interest savings account in a 3.x% inflationary environment?

I mean this sincerely if I could just park my savings in an “exactly matches inflation” account I would be over the moon. So yeah kinda, I believe it. Terrible interest rates have genuinely caused me to have to find somewhere to put my money that isn’t a bank.

Re: $3B in Bitcoin was sold in a last-ditch attempt to save UST from collapse

#465

Post by Spivak »

echelon wrote: post #277
lkrubner wrote: post #263

Earlier quoted context omitted.

"everything is a bit oversold right now on negative emotions" No!!! The Fed is raising rates. That is reality. That is not an emotion. That is absolute economic fact. Inflation is high and will remain high for at least a year (maybe longer). The period from 2008 to 2022 is going to be remembered as an abnormal period when we experienced abnormally low rates. The low rates fueled speculation, and bid up certain stocks…

> The era of low rates is over. It is possible that you might live another 100 years and never again see a 14 year stretch where rates average as low as they did from 2008 to 2022. Goodness, I hope not. The amount of progress we've seen in these years has been astounding. Deep learning, SpaceX, smart phones. I felt like things had gotten stagnant, then we truly started hitting our stride.

It’s not relay about how much “progress” we’ve made. It’s about employment, once we hit full employment there’s no more water you can squeeze from the rock.

Which is why I’m kinda shocked that the US isn’t more gung ho about immigration because as long as there’s more useful work to do, and there is, we can fuel growth with capital plus people.

Re: $3B in Bitcoin was sold in a last-ditch attempt to save UST from collapse

#466

Post by asimjalis »

eric_cc wrote: post #205
snovv_crash wrote: post #201

Earlier quoted context omitted.

Luna crashed because people lost trust in it. The only reason people have trust in BTC is because other people have trust in it. If that ever changed, there is no actual use for a BTC, and they are thus intrinsically worthless. Fiat currency has the backing of a government. The government demands certain payments of this currency in order to own land, and also for some extra rights like mineral extraction, fishing li…

> Luna crashed because people lost trust in it. No. It crashed because trillions of tokens were created rendering each token worthless.

Why were these trillions of tokens created? Wouldn’t that naturally lead to the token’s devaluation?

Re: $3B in Bitcoin was sold in a last-ditch attempt to save UST from collapse

#467

Post by jimmydorry »

ImPostingOnHN wrote: post #412
jimmydorry wrote: post #392

Earlier quoted context omitted.

From the article, El Salvador has been cut off from financial markets by two of the ratings agencies that played a pivotal role in the corruption that caused the 2008 GFC to happen. Their reason for cutting El Salvador off is because their debt to GDP is approaching 87% (a fraction of what other countries have run up, especially due to COVID). The IMF (International Monetary Fund) which typically steps in to offer pr…

if bitcoin constitutes an insignificant portion of their activities, why would they oppose such a term?

One of their largest industries (up there with tourism) is remittance processing (mostly for out of the US) denominated in US dollars. Most of their local economy operates on US dolar too, which means accepting Bitcoin everywhere offers some significant advantages:

1. Not being beholden to the whims of American banks and the American government

2. Less administrative overhead would mean being able to offer more competitive services with lower fees [1]

3. Being Bitcoin friendly would attract more crypto oriented industries to be based out of their country: offering a wider market to tap into (global remittances)

[1] "Last year, they collectively transferred nearly $6 billion, or roughly 23% of the country’s gross domestic product, and a chunk of that went to the middlemen facilitating these international transfers." https://www.cnbc.com/2021/09/09/el-salvador-bitcoin-move-cou...

Re: $3B in Bitcoin was sold in a last-ditch attempt to save UST from collapse

#468

Post by 111111101101 »

vkou wrote: post #121
vmception wrote: post #26

Earlier quoted context omitted.

By 2032? We need new songs, “you just got Do Kwon’d” instead of “Mt Goxxed”

Just as a reminder about how Mt Gox played out - it looks like all the people who lost money on it will receive 1:1 fiat-denominated compensation for their losses, Mark Karpeles won't serve a day in prison, and is likely to walk away with ~3 billion worth of BTC[1]. Who'd have thought that failing to operate a bitcoin exchange is a thousand times more lucrative than actually operating one! [1] If Mark owed you a bitc…

This isn't true at all. For the current expected payouts see the calculator at https://www.ozcoin.com.au

Re: $3B in Bitcoin was sold in a last-ditch attempt to save UST from collapse

#469

Post by jrsj »

joosters wrote: post #4

"Sold" It's hard to show that they really sold these coins. Certainly, the LFG transferred the coins to some different exchanges. But did they truly sell them? If I was running a dodgy ponzi scheme and saw it collapsing catastrophically, I don't think I'd be throwing good money after bad trying to futilely patch it up. Much better to stash the remaining assets away somewhere and personally cash out later on. Also, “I…

Historically shitcoins failing has been good for Bitcoin.

Re: $3B in Bitcoin was sold in a last-ditch attempt to save UST from collapse

#470

Post by jimmydorry »

low_tech_love wrote: post #424
vmception wrote: post #419

Earlier quoted context omitted.

The blockchain removes the need for trust when the blockchain is involved completely and without obfuscation The need for trust doesnt stay removed magically because someone in the blockchain space was involved

Which is exactly what happened and we seem to agree. Thanks!

They could have used a decentralised exchange, but didn't. I guess that is telling in and of itself. The tools were there for them to use, without trust, but they weren't used.
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