TerraUSD crash led to vanished savings, shattered dreams • Hacker News Board

Re: TerraUSD crash led to vanished savings, shattered dreams

#221

Post by pcthrowaway » Wed, Jun 22, 2022, 7:25 AM UTC

andrewstuart wrote: post #172

There's nothing at all wrong with crypto if you understand it is a ponzi scheme and nothing more . With that understanding, you now know how to play the game - which is to say you MUST get out before the ponzi collapses. Your job as investor/gambler is to get in while the house of cards is starting to be built, and to get out before the Jenga tower collapses - and it definitely will. If however you play crypto and te…

Interesting take. I mostly agree, but I do think there is legitimate value in the foundation. Every time the ponzi collapses, the next jenga tower has a slightly higher foundation

Re: TerraUSD crash led to vanished savings, shattered dreams

#222

Post by mmarq » Wed, Jun 22, 2022, 7:25 AM UTC

SilverBirch wrote: post #205

I think we really need to start talking about the broader "why" of why crypto. There's a good reason that we're seeing /r/antiwork and people throwing their last pennies into crypto. People have seen that those with assets got rich and those that work get poorer. There's no point aspiring to a better life through work. In reality what has happened is inflation that we don't measure. Assets are inflated by easy money…

I’ve been saying for years that we should reduce taxes on work and increase taxes on assets and consumption. At the current level of taxation, accumulating wealth through work is out of the grasp of 95% of the population (at least in the UK, where they’d earn less than 90K).

Re: TerraUSD crash led to vanished savings, shattered dreams

#223

Post by marcus_holmes » Wed, Jun 22, 2022, 7:26 AM UTC

So, what are we going to do about this?

We've known that the whole crypto scene in general is a fraudulent, cynical ploy to get rich at other people's expense. Any conversation with anyone involved in the industry quickly reveals that their goal is to get rich from asset speculation. And that means for them to win, someone else must lose.

The thing that the article describes is an inevitable consequence of this process. This story will play out again and again - gullible people getting their lives ruined by "investing" in crypto because they believed a bunch of blatant lies about it.

This is fraud. There needs to be consequences, and the liars going to jail for deliberately destroying other people's lives.

Re: TerraUSD crash led to vanished savings, shattered dreams

#224

Post by pcthrowaway » Wed, Jun 22, 2022, 7:28 AM UTC

cowtools wrote: post #60

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…

>If my coins are pegged to USD how do they appreciate? Staking rewards. It's marketed as a necessary feature of PoS cryptocurrencies, but it isn't really necessary if the cryptocurrency is actually centralized anyways. Centralized cryptocurrencies like USDT just use it to entice buyers with rewards for just holding it, creating inflation at the cost of everyone else. This is a major reason against Proof-of-Stake: if…

UST staking had nothing to do with PoS though. The Terra blockchain's native cryptocurrency was LUNA. There was a relationship to LUNA, in that $1 worth of luna burnt would mint $0.999 UST, and vice versa (1 UST burnt would mint $0.999 of LUNA).

UST was appealing because you could supply it in Anchor protocol, which was a money market. Anchor advertised nearly 20% APY on your supply, so it was appealing to convert your fiat to UST and then supply it to Anchor like a high interest savings account.

Re: TerraUSD crash led to vanished savings, shattered dreams

#225

Post by rax0m » Wed, Jun 22, 2022, 7:29 AM UTC

gonehome wrote: post #176

Lots of noise in the crypto space and the HN comments are always bad. BTC and ETH are the interesting and worth putting a small percentage of your holdings into (BTC [0] as an international store of value that has benefits over gold, ETH as the core programmable token that backs anything that stores stuff on chain to manage decentralized state). Vitalik is earnest and his writing is pretty great. Everything else I'd…

I used to think Vitalik was earnest as well. I was an ETH believer up until a few years ago. My distrust in him was the crack that in the end spread and became a distrust in ETH.

I'll just provide 2 sources for this, fossuser, and then you can judge for yourself. Cause I just feel bad if someone else trusts someone I know to be intellectually dishonest at times.

[0] https://www.truthcoin.info/blog/pos-still-pointless/ (Vitalik being intellectually dishonest in his responses, which is proven by Paul in his follow-up article)

[1] https://twitter.com/adam3us/status/1273353652447608834

Re: TerraUSD crash led to vanished savings, shattered dreams

#226

Post by TheTeriyakiDon » Wed, Jun 22, 2022, 7:30 AM UTC

cowtools wrote: post #60

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…

>If my coins are pegged to USD how do they appreciate? Staking rewards. It's marketed as a necessary feature of PoS cryptocurrencies, but it isn't really necessary if the cryptocurrency is actually centralized anyways. Centralized cryptocurrencies like USDT just use it to entice buyers with rewards for just holding it, creating inflation at the cost of everyone else. This is a major reason against Proof-of-Stake: if…

UST was not able to be staked in a Proof-of-Stake system. UST was lent (to borrowers) via lending protocols, and in return the lenders earned interest. This interest was subsidized by Luna to encourage usage of the UST stablecoin.

USDT also doesn't incentivize holders of the token. Centralized or decentralized platforms may offer incentives for depositing token though, but this isn't done by Tether itself.

Re: TerraUSD crash led to vanished savings, shattered dreams

#227

Post by bowsamic » Wed, Jun 22, 2022, 7:32 AM UTC

jmyeet wrote: post #31

I occasionally get asked by relatives and friends of what to invest in. Now I'm no expert but I guess in the valley of the blind the one-eyed man is king. Thing is what I tell them seems to bore them because, well, it's boring. My advice is basically this: Put your money in a broad index fund and don't look at it for 10 years. In giving this advice you start to realize it's not what people want to hear. It's not that…

It's ego and over-confidence. People think they can outperform the S&P500. They can't.

Re: TerraUSD crash led to vanished savings, shattered dreams

#228

Post by bowsamic » Wed, Jun 22, 2022, 7:36 AM UTC

marcus_holmes wrote: post #223

So, what are we going to do about this? We've known that the whole crypto scene in general is a fraudulent, cynical ploy to get rich at other people's expense. Any conversation with anyone involved in the industry quickly reveals that their goal is to get rich from asset speculation. And that means for them to win, someone else must lose. The thing that the article describes is an inevitable consequence of this proce…

> Any conversation with anyone involved in the industry quickly reveals that their goal is to get rich from asset speculation.

Do you really think if you ask Charles Hoskinson (creator of Cardano) this, then this will become clear? If so why bother with so much peer-reviewed academic research? Is that all part of the scam?

Re: TerraUSD crash led to vanished savings, shattered dreams

#229

Post by anaxag0ras » Wed, Jun 22, 2022, 7:37 AM UTC

Animats wrote: post #7

Oh, no. They had feeder funds. Stablegain [1] was feeding money into them: You can now earn up to 15% APY interest on your cash with Stablegains. This is 30x higher than in your traditional bank. You can deposit and withdraw using your preferred methods (ACH, wire transfer, USDC) with the help of our partner Circle. There are no long-term lock-up periods. Earn passive income every day We take care of all technical as…

I'm struggling to understand what the added advantage was of depositing on Stablegains, with 15% APY over Anchor with 19% APY, with both having equal risks.

I mean Stablegains sound like grifters who thought they could make easy money (siphoning 3%-4%) by slapping a new UI and marketing the heck out of it.

Re: TerraUSD crash led to vanished savings, shattered dreams

#230

Post by bowsamic » Wed, Jun 22, 2022, 7:38 AM UTC

rofo1 wrote: post #218

markmark wrote: post #83

Earlier quoted context omitted.

I have a friend who lost about $5k in the Terra crash. So not a lot, but he'd rather have $5k than zero. And when he was telling me about it before putting money in he was talking about the 15% thing and that it seemed like easy money, and I said something like "well unless the whole thing just goes to zero". And you could tell he just didn't see that as a possibility. Like he's not completely blind, he knew he could…

People are not sufficiently educated about the value of things, vs. pricing, appreciation and so on. Just the fact that anybody can think that you can get 15% "risk free" over long periods of time means that they are out of touch with reality. Not to mention people thinking they will get 10x on their investments, without ludicrous amount of risk.

You can easily get (far more than) 15% return over a long period basically risk free by buying the S&P500, so it appears that you are the one who is out of touch with reality.

EDIT: How am I wrong?