a16z companies next?
https://standardcrypto.wordpress.com/2020/04/30/a16z-struggl...
YC W22 Stablegains is being sued for losing $42M in funds from 4878 customers
111–120 of 411 posts
Re: YC W22 Stablegains is being sued for losing $42M in funds from 4878 customers
#112The last few weeks (months, really) has highlighted an incredible lack of discernment in the VC-verse wrt the thing we call web3. Now. I have no experience doing what YC does and don’t claim to, but the jig here was so transparent that the smallest drop of “street smart” should’ve been enough to set off some alarms. We’re approaching a point where being passed over for “culture fit” is a compliment. Hopefully the emb…
I think this is something like AI -- where people who are calling it "AI" are often sales people/hucksters (I mean this as little a pejorative sense as possible), and the people calling it "ML" are the practitioners/people you should be listening to. Once a phrase gains mainstream adoption and starts to rapidly lose meaning, I find that people who care dearly about that thing start calling it something else. That sai…
As someone who went heavy into crypto/web3, it does pain me to admit that there really are no use cases besides making money. Which isn’t a bad use case by itself, but after using practically hundreds of protocols and projects, there’s not a single one I’d use if there was no prospect of making money off of it. My dApp usage has cooled off almost completely. And all data shows that this is true for most others as well
Re: YC W22 Stablegains is being sued for losing $42M in funds from 4878 customers
#113Earlier quoted context omitted.
Do you have any links / references regarding that? I'd like to read more
We considered putting some of our treasury in Anchor. I didn't build a model, just one hour of DD was enough to see the risks. Here is the message I shared with my team on Slack with the findings from a very brief DD: https://twitter.com/josusanmartin/status/1524323026942242818
About 5 seconds thought would be enough to see the risks, and the same goes for the rest of the crypto ecosystem. Even the name of UST is clearly meant to con people who confuse it with USDT. It's scams upon scams all the way down.
Even if your figures seem out of date, your argument against UST also holds for USDT (which underpins much of the crypto price bubble):
There is 7B USD in circulation and the market cap of US(D)T is 74 BILLION USD
All this perceived wealth is going to melt into air soon, and yes a bear market has already arrived.
Re: YC W22 Stablegains is being sued for losing $42M in funds from 4878 customers
#114I imagine (and hope) those 5k where mostly crypto bros who knew what they were getting into. Who else expects 15% returns from a "safe" investment?
As a recovering crypto bro, none of my other friends have been impacted by this entire UST/Luna meltdown at all
Why? Because crypto bros are too degen to be okay with 15% yield lol
Re: YC W22 Stablegains is being sued for losing $42M in funds from 4878 customers
#115Re: YC W22 Stablegains is being sued for losing $42M in funds from 4878 customers
#116Earlier quoted context omitted.
Sure, but if I remember correctly they said that they would give the shares back for free or something. So even if the unethical company didn't go bust but exited, they wouldn't get any cash.
Wouldn't that create an incentive for successful companies to be unethical?
I don't think YC would ever forfeit their shares from a successful company.
Re: YC W22 Stablegains is being sued for losing $42M in funds from 4878 customers
#117Earlier quoted context omitted.
There were funds that did due diligence and built out models of the Luna/Terra/Anchor ecosystem and realized it was unstable. You can talk to the people who built their models and they have lots of fun things to say about the ordeal.
That raises an interesting ethical problem, really; should there be a duty to report this sort of thing, or is "scheme X is fundamentally flawed/a scam and investors will lose everything" legitimate proprietary information? As I understand it, various analysts were pretty sure at the time that Madoff's scheme was a Ponzi, but in general they didn't tell anyone (in fairness, one attempted to and had trouble getting li…
There were many people that reported on the flawed stability mechanism of Terra/Luna/UST. But still, there were many other people that placed their trust in it and cheered the price appreciation.
Re: YC W22 Stablegains is being sued for losing $42M in funds from 4878 customers
#118Earlier quoted context omitted.
I publicly called out LUNA/UST on Twitter a few times a few months before the collapse [0] [1]. Just stating this so it's clear that I don't have any interest defending them. That being said, calling these platforms "ponzis" isn't correct, the most you can say is that they were front ends for a ponzi. It would be like setting up a front-end to receive investments, and then depositing the money with Madoff. I'm not sa…
> It would be like setting up a front-end to receive investments, and then depositing the money with Madoff. I'm not saying it's a legitimate business, just not a ponzi. So, it’s neither legitimate nor a Ponzi. Cool, what is it then?
it's fraud
Re: YC W22 Stablegains is being sued for losing $42M in funds from 4878 customers
#119Earlier quoted context omitted.
There were funds that did due diligence and built out models of the Luna/Terra/Anchor ecosystem and realized it was unstable. You can talk to the people who built their models and they have lots of fun things to say about the ordeal.
That raises an interesting ethical problem, really; should there be a duty to report this sort of thing, or is "scheme X is fundamentally flawed/a scam and investors will lose everything" legitimate proprietary information? As I understand it, various analysts were pretty sure at the time that Madoff's scheme was a Ponzi, but in general they didn't tell anyone (in fairness, one attempted to and had trouble getting li…
for context for others following along, Galois Capital went public with their criticism months before they started shorting. most people didn't listen.
Re: YC W22 Stablegains is being sued for losing $42M in funds from 4878 customers
#120Earlier quoted context omitted.
The money changed hands... from people gambling on financial instruments to other people who are probably also gambling on financial instruments. Significant real value was only destroyed forever if the underlying tech for this is based on proof of work. Mining bitcoin destroys an enormous amount of ~real value, and nobody who cares about the advancement of society should touch it. Proof of work crypto mining is some…
It's a great analogy because: Banning watering gardens is exactly as dumb as banning proof of work. The vast majority of water wastage occurs irrigating farms supporting crops that are unsuitable for that area. A solar panel connected to a coin miner is only doing good in the world. Where is the negative? You sure it's the mining that is the bad thing and not the dirty energy?
> Where is the negative?
For one, you are wasting a solar panel that could be offsetting more positive energy usage. And building both the solar panel and the miner is far from emission-free.