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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

#261

Post by josefx »

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…

>ETH

Which ETH? As far as I understand the currency keeps forking and rewinding every now and then because whatever safety features it provides to "smart" contracts are widely insufficient and the resulting buggy mess falls over the moment a sufficiently motivated script kiddy so much as sneezes into its general direction.

Re: TerraUSD crash led to vanished savings, shattered dreams

#262

Post by TrackerFF »

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…

We need to regulate stablecoins, and we need to regulate Web3 entities like regular companies.

And I believe regulations are coming. Regulations don't conjure out of thin air - but tend to be the result of people or governments getting screwed over.

Re: TerraUSD crash led to vanished savings, shattered dreams

#263

Post by HWR_14 »

SilasX wrote: post #202
arcticbull wrote: post #34

Earlier quoted context omitted.

You're welcome to review my post history.

Okay, I’ll bite. Your comment history doesn’t have you mentioning Terra, TerraUSD, or Luna before May 9, e.g. https://hn.algolia.com/?dateRange=all&page=0&prefix=false&qu... You just made generic anti-crypto recommendations, some of which look good in hindsight. That’s not the same as identifying the specific mechanism that proved to be Luna’s downfall; it’s more like being a permabear who predicted 8 of the last 3 s…

Why can't I rely on "avoid crypto, it's a scam"? I have to identify every new coin and it's mechanism of failure?

Re: TerraUSD crash led to vanished savings, shattered dreams

#264

Post by Sprite_tm »

SilasX wrote: post #197
Animats wrote: post #129

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/

Withdrawals are supposed to reduce market cap.

Until liquidity runs out.

Re: TerraUSD crash led to vanished savings, shattered dreams

#265

Post by beachy »

WJW wrote: post #246
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…

I once read an article describing this basically as "farming" vs "trapping" tactics. For a farmer, there is basically always more work to do (weeding, sowing, harvesting, maintaining tools and buildings, looking after animals etc etc etc) and often more work directly results in more profit. Trapping on the other hand is not like that. Once you have set your traps, you must now sit still and wait. Checking every 5 min…

That's an interesting premise, but as someone who does regular trapping for exotic pests, actual trapping is very much work.

You do your rounds (a lot of walking), pull out dead animals and carry them with you, re-bait your traps, repair traps as required, dump the dead animals, and repeat over and over again.

I guess there are other forms of trapping - more like hunting, a one off exercise to get that - but I would hazard most professional trappers would see it as very much like work.

Re: TerraUSD crash led to vanished savings, shattered dreams

#266

Post by MadeThisToReply »

pastacacioepepe wrote: post #220
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…

If your friend only had $5k in total and threw them all in Terra then I guess the lesson he got in the crash is way more valuable than any savings he might have kept. He would have lost them anyway on the next shitcoin.

This was my main lesson. I lost some money on Terra/Luna - thankfully much less than $5k, but still enough to sting. Looking back, I can see that I really had no idea what I was getting myself into and it was mostly just FOMO.

Obviously I'd rather still have the money I lost, but in a sense I feel lucky. If Luna had waited an extra six months to collapse I would have become confident enough to put more money in, i.e. I'd have ended up losing even more. And I'll definitely be putting much, much more thought into any kind of crypto "investments" I make in future. The money I lost was a small price to pay for the lesson I've learned.

Re: TerraUSD crash led to vanished savings, shattered dreams

#267

Post by MadeThisToReply »

CTDOCodebases wrote: post #236
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…

How can Bitcoin be a ponzi scheme if it doesn't generate returns for the investors? I have bought and sold Bitcoin on an exchange and the anonymous person on the other end of the trade did not make any promises of returns. By your definition is Uber stock a ponzi scheme? It too does not provide a return and relies on buying pressure to increase it's price so people can reap the rewards of their so called "investment"…

"Ponzi scheme" has become completely divorced from its original meaning. It's supposed to refer to a specific type of scam where you pay "investors" using the money you received from previous investors, but nowadays it's basically just used now to mean "anything crypto-related in which people might lose or have lost their money."

Re: TerraUSD crash led to vanished savings, shattered dreams

#268

Post by disillusioned »

pototo666 wrote: post #232
pastacacioepepe wrote: post #214

Earlier quoted context omitted.

I've been working real hard for the past 10+ years and I have very little to show for it yet. In the meantime a couple of friends who never worked got rich(er) just because they bought a few thousands $ (money borrowed...from their family) worth of crypto at the right moment. What is this bullshit? Why am I even busting my ass trying to create value, when I could just buy shitcoins and become a millionaire? I don't t…

I would argue that crytpo is not pure lottery. It's a risky investment. As every assets, crypto can be over-valued or under-valued. As someone from China, where central government limit foregin currency exchange, Bitcoin is a god-given tech. I'm not arguing for its value and i don't mean to persuade anyone. This is my opinion. I believe in its value. And guess what? I miss the crypto train too. And I have zero crypto…

It's a risky investment in the exact same way a lottery ticket is a risky investment: unless a particular lightning bolt of luck strikes you, it stands to reason that no underlying value is being created to return to your investment, _particularly_ for the shitcoins. They're just "toss a few thousand dollars at the dartboard and see what pumps" pure luck. As evidenced by the falling knives people are trying to catch right now.

Re: TerraUSD crash led to vanished savings, shattered dreams

#269

Post by MadeThisToReply »

TrackerFF wrote: post #262
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…

We need to regulate stablecoins, and we need to regulate Web3 entities like regular companies. And I believe regulations are coming. Regulations don't conjure out of thin air - but tend to be the result of people or governments getting screwed over.

The whole point of crypto is that it's not regulated. As soon as the regulators take real action on crypto, the entire promise of crypto will vanish in a puff of smoke.

I'm not saying that's a bad thing, but I struggle to envision what a tightly-regulated crypto market would look like that wouldn't defy the entire point of crypto.

Re: TerraUSD crash led to vanished savings, shattered dreams

#270

Post by CTDOCodebases »

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…

> Then I can.. sell it for $100? What’s the point?

You can trade your stablecoins against other cryptocurrencies that they are paired against on exchanges or you can loan your stablecoins to a platform for a profit so they can lend it out to others for a profit. Banks do the same thing. When you deposit money into a bank account you are essentially lending the bank money. We call it a deposit but it's not like the bank is actually holding 100% of everyone's deposits.

> 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?

A low risk way of generating a return would be the platform lends out the coins you have locked as a secured loan for a profit.

The high risk way of generating a return would be the platform you have your stable coins locked up on finds another lending platform generating a higher return than they are promising and they invest your locked up funds there.

> But if the coins are pegged where do they get the money for the new coins they’re giving me?

They are created out of thin air. Basically they have to incentivise people to use their coins while keeping enough funds on hand to mop up any excess liquidity on exchanges when the price of their stable coin breaks peg. Governments do the same thing with national currencies. They incentivise you to use national currency by naming it legal tender and enacting capital controls as we have seen recently in Russia, Turkey and Lebanon.

If they don’t promise returns why would anyone invest in a stablecoin?

In some countries trading from crypto to crypto is not a taxable event unlike trading crypto to dollars. Stablecoins were embraced by exchanges too so it really is a lot easier to trade crypto for crypto than it is to trade currency for crypto or vice versa. Essentially people don't invest in stable coins for the most part. They use them because they have a greater utility than actual dollars.

That said buyer beware! Cryptocurrency is a largely unregulated space and regulations exist for a reason!

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