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TerraUSD crash led to vanished savings, shattered dreams

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Re: TerraUSD crash led to vanished savings, shattered dreams

#121

Post by charlie0 »

Coming from relative poverty, I can say that, counterintuitively, a lot of people way down on the socioeconomic ladder would rather gamble on a moonshot to riches rather than invest in an index fund.

One large part of this is simply lack of education.

The other part is the realization that if making close to minimum wage, investing in an index fund would still take quite a very long time to go up significantly.

Give the choice of waiting 40 years for not a huge payoff or gambling your 5K-10K of savings for a potential 10x return in a year or two, it's easy to rationalize the latter.

Of course, now I'm fortunate enough to be a well paid SW. The marginal utility of every dollar above 75K is low in the present, so I can put all that in investment funds.

Re: TerraUSD crash led to vanished savings, shattered dreams

#122

Post by dubswithus »

MBCook wrote: post #118
dubswithus wrote: post #112

Earlier quoted context omitted.

Y Combinator was an investor in Coinbase and other crypto startups. Sam Altman personally invested in Worldcoin. You are posting on a forum of an incubator that supports crypto. The irony.

If VCs think they can make money in the next pet rock, they’ll try. It doesn’t make pet rocks an important or useful product. Just something people can make money on.

Most products aren’t important or useful. The public uses them because, well, it’s complicated.

Re: TerraUSD crash led to vanished savings, shattered dreams

#123

Post by prostoalex »

ano88888 wrote: post #105
MBCook wrote: post #55

Ok I’ve never tried to look into TerraUSD or other stablecoins before. So I have $100. I use that to buy $100 worth of Terra because it’s pegged to USD. Then I can.. sell it for $100? What’s the point? If they promise returns where are they supposed to come from? If my coins are pegged to USD how do they appreciate? Or is the idea they just give me more for holding? But if the coins are pegged where do they get the m…

the biggest utility is moving money across borders. Not sure about TerraUSD but USDT is very valuable in a lot of countries like Dubai and others. It is the heaven for money laundering or avoiding tax and the demand and transaction volume is hugeee. For example, in south east asia , all the casinos, digital frauds, drug sales are using USDT as a way to move money or transact.

It's frequently touted as such, but don't you generally need some supply-demand parity across the borders?

E.g., there's likely high demand for USDT to move money out of Russia, given the currency control and Visa/MC restrictions. But if you're currently in Russia sitting on a massive pile of USDT, you probably don't want a massive ruble exposure either, and hodl'ing that USDT seems like a fairly solid strategy for the time-being?

Re: TerraUSD crash led to vanished savings, shattered dreams

#125

Post by unmole »

dubswithus wrote: post #112
unmole wrote: post #46

Earlier quoted context omitted.

> But that’s so easy to say after the fact. HN was almost always negative about the crypto currency hype. Even when shitcoins were at ATH. So, no. The criticism is not after the fact. > If these people really could foresee these events happening, then they could have made a lot of money by taking short positions. Markets can stay irrational longer than you can stay solvent has been a cliche for almost a century. That…

Y Combinator was an investor in Coinbase and other crypto startups. Sam Altman personally invested in Worldcoin. You are posting on a forum of an incubator that supports crypto. The irony.

It's almost as if YC and HN users have entriely different incentives and opinions. Shocking.

Re: TerraUSD crash led to vanished savings, shattered dreams

#126

Post by dubswithus »

unmole wrote: post #125
dubswithus wrote: post #112

Earlier quoted context omitted.

Y Combinator was an investor in Coinbase and other crypto startups. Sam Altman personally invested in Worldcoin. You are posting on a forum of an incubator that supports crypto. The irony.

It's almost as if YC and HN users have entriely different incentives and opinions. Shocking.

Have you seen the comments when one of Paul Graham’s essays is posted?

Isn’t it kind of strange to be hanging on a VC funded forum that supports crypto?

Re: TerraUSD crash led to vanished savings, shattered dreams

#127

Post by makeitdouble »

nradov wrote: post #74
makeitdouble wrote: post #51

Earlier quoted context omitted.

I think index funds are better seen as "savings" than "investments" in most people's mind.

I've literally never heard of anyone referring to index funds that way. You're not making any sense at all.

People don't refer to gold, or buying a house a "saving" either, but they definitely see it as safe haven values, and not as their money being "actively" invested (even as they do bear risks and are fiscally categorized as investments).

For people I talked to, beating inflation was their base goal.

Re: TerraUSD crash led to vanished savings, shattered dreams

#128

Post by erehweb »

rurp wrote: post #79
KMag wrote: post #56

Earlier quoted context omitted.

In my experience, it seems that a lot of people have an un-stated gut feeling that "doing something" must out-perform passive dollar cost averaging a broad low-fee index ETF. If we came up with some obfuscated mathematical dance that, if un-obfuscated, were obviously dollar cost averaging in a broad-based low-fee index ETF, I think it would be more popular. Edit: There are also lots of investment strategies where peo…

Heh, I think that idea has a lot of promise. Casinos might offer some guidance here given how good they are at making games with fairly straightforward negative odds seem enticing. We need some sort of responsible investing vehicle that includes gamification, intermittent reinforcement, and a tiny chance for a huge payoff.

Premium Bonds in the UK are part of the way there https://www.nsandi.com/products/premium-bonds

Re: TerraUSD crash led to vanished savings, shattered dreams

#129

Post by Animats »

Uh oh. Heavy withdrawals at USDT.[1]

Half a billion dollars pulled out today, all at once. Almost four billion in the last week. The market cap for USDT has dropped from US$84 billion to US$63 billion in the last month and a half.

Looks like we're going to find out soon what assets really back Tether.

[1] https://coinmarketcap.com/currencies/tether/

Re: TerraUSD crash led to vanished savings, shattered dreams

#130

Post by ano88888 »

prostoalex wrote: post #123
ano88888 wrote: post #105

Earlier quoted context omitted.

the biggest utility is moving money across borders. Not sure about TerraUSD but USDT is very valuable in a lot of countries like Dubai and others. It is the heaven for money laundering or avoiding tax and the demand and transaction volume is hugeee. For example, in south east asia , all the casinos, digital frauds, drug sales are using USDT as a way to move money or transact.

It's frequently touted as such, but don't you generally need some supply-demand parity across the borders? E.g., there's likely high demand for USDT to move money out of Russia, given the currency control and Visa/MC restrictions. But if you're currently in Russia sitting on a massive pile of USDT, you probably don't want a massive ruble exposure either, and hodl'ing that USDT seems like a fairly solid strategy for t…

There might be some supply-demand parity but price will take care of it. It is just like any currency exchange or border transfer but without the regulations and tax. Eg. USD is more widely preferred than Thai baht but there is a still a large market for exchanges and money transfer.
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