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Celsius Execs Cashed Out $40M in Crypto Before Halting Withdrawals for Customers

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Re: Celsius Execs Cashed Out $40M in Crypto Before Halting Withdrawals for Customers

#311

Earlier quoted context omitted.

You can't sell things on a website if paypal blocks you. Money does not work here, crypto does. also, how do you convert your blocked paypal account into cash? cash and online banking are two different things.

Where did we talk about selling online? Also you can sell online using cash, i.e. one person sends cash the other sends the goods (Mullvad for example sells the VPN services with cash). True most online places don't accept cash, but most also don't accept crypto either, and lets not even talk about physical places.

The Irony is that the owners of celsius were holding crypto's they controlled, They sold the crypto and the fiat currency their users held are now unable to be returned to them. This is why the ability to exchange any given asset(selling) is far more important. Yes, they could have held fiat currency in cash in their couch but buying crypto is far better than that because you own the asset, you dont have to mail anyone money and fear law enforcement from asking questions (very possible if you attempt to buy anything expensive in cash, especially by mail) and crypto is safe even if your house burns down and your deposit box gets stolen. But people buying into celsius decided to give them all the advantage of the cryptocurrency protocol and all the risks with lending someone else money.

I'm not even endorsing crypto, Just pointing out how much people misunderstood what the point of crypto even is. No company should receive money for holding your keys unless its dropbox

Re: Celsius Execs Cashed Out $40M in Crypto Before Halting Withdrawals for Customers

#312
post #301

Earlier quoted context omitted.

> blockchain-based assets cannot be seized I don't see the distinction you're drawing. If they've been deposited into a smart contract like a Maker CDP, then they can be liquidated, which is much like being seized and auctioned in traditional finance. > Funds are simply swapped. If I take a margin loan against some TSLA stock, would you say I've swapped TSLA for cash? Most people (tax authorities included) would say…

The reason the collateral needs to be deposited with a smart contract is because the collateral assets are unseizable. But that defeats the purpose... Imagine you want to make purchase, but you don't have the funds. You have two options. Option A, you save money first, until you have enough funds. Option B, you borrow money, and save later (while you repay the loan). In economics, option A is called "saving" while op…

Suppose I make an NFT which support liens. I.e. upon mutual agreement, a transaction can modify the NFT to add a lien, while (simultaneously) transferring some USDC from the lender to the NFT owner. The NFT can't be transferred while it has a lien, but the owner can remove the lien by repaying the lender. The lender can also transfer the NFT to herself if the loan isn't repaid after a certain period.

If I wanted to finance an NFT, first I would negotiate with a lender and get a pre-approved loan. The NFT marketplace wouldn't even need to know about the lending mechanism. In a single transaction, I could take a flash loan, purchase the NFT from the marketplace, take the pre-approved loan, and use that to repay the flash loan. I now own an NFT with a lien, which I can enjoy in the usual ways, e.g. I could integrate it with my Twitter profile.

How is this not financing?

Re: Celsius Execs Cashed Out $40M in Crypto Before Halting Withdrawals for Customers

#313
post #301

Earlier quoted context omitted.

The reason the collateral needs to be deposited with a smart contract is because the collateral assets are unseizable. But that defeats the purpose... Imagine you want to make purchase, but you don't have the funds. You have two options. Option A, you save money first, until you have enough funds. Option B, you borrow money, and save later (while you repay the loan). In economics, option A is called "saving" while op…

Suppose I make an NFT which support liens. I.e. upon mutual agreement, a transaction can modify the NFT to add a lien, while (simultaneously) transferring some USDC from the lender to the NFT owner. The NFT can't be transferred while it has a lien, but the owner can remove the lien by repaying the lender. The lender can also transfer the NFT to herself if the loan isn't repaid after a certain period. If I wanted to f…

You make an NFT, and then you get a loan that you use to purchase the NFT, and if you don't repay the loan the owner gets to keep the NFT? It seems that you're financing the purchase of something you already owned. And of course the supposed financing is being done by this "pre-approved loan" which you tell us absolutely nothing about. What is that? A loan agreement? What does the agreement say and how is it enforced?

Re: Celsius Execs Cashed Out $40M in Crypto Before Halting Withdrawals for Customers

#314
post #313

Earlier quoted context omitted.

Suppose I make an NFT which support liens. I.e. upon mutual agreement, a transaction can modify the NFT to add a lien, while (simultaneously) transferring some USDC from the lender to the NFT owner. The NFT can't be transferred while it has a lien, but the owner can remove the lien by repaying the lender. The lender can also transfer the NFT to herself if the loan isn't repaid after a certain period. If I wanted to f…

You make an NFT, and then you get a loan that you use to purchase the NFT, and if you don't repay the loan the owner gets to keep the NFT? It seems that you're financing the purchase of something you already owned. And of course the supposed financing is being done by this "pre-approved loan" which you tell us absolutely nothing about. What is that? A loan agreement? What does the agreement say and how is it enforced…

I mean Person A makes an NFT and lists it for sale for $X USDC. Then Person B, who only has $Y USDC ($Y If Person B repays the loan within T days, the lien is removed, so Person B owns it free and clear. Otherwise, the NFT is transferred to Person C.

The pre-approved loan would just be a message signed by Person C, granting anyone permission to transfer a certain amount out of Person C's account if (in the same transaction) they also grant Person C a lien on that particular NFT.

Person C's loan funds wouldn't be in an ordinary account, but rather in a smart contract which understands these liens and loan approval messages.

Re: Celsius Execs Cashed Out $40M in Crypto Before Halting Withdrawals for Customers

#315
post #294

Earlier quoted context omitted.

I think you missed my point. A recent example is Solana. Their network keeps crashing [0]. Everyone keeping their own keys are completely locked away from trading their coin. Everyone with their coin owned in a centralized exchange can trade freely. If you hold your own coins, you're vulnerable to network attacks and AMM instability/hacks. If you put the coins on an exchange, you're vulnerable to the exchange's liqui…

Yes, if you use Solana you should be aware that the chain very regularly has serious downtime. Ethereum gas fees can spike but generally there has never been downtime.

All chains have problems. Ethereum hard forked and high gas fees. Just to spend your money costs $20 USD :|.

How much downtime did Terra have before it crashed?

Re: Celsius Execs Cashed Out $40M in Crypto Before Halting Withdrawals for Customers

#316

Earlier quoted context omitted.

No bitcoin has always been difficult to insure because no sane company would insure something that can double or triple value overnight. The extreme finite quantity of bitcoins is what makes it difficult to insure.

i suppose i thought you meant insurance against theft, not loss of value

theft is loss of value. either way the fact remains, Bitcoin is difficult to insure due to its scarcity. If I insure 1 BTC now worth $10k then in 20 years or so (or maybe overnight) it jumps to $1mil. The insurance company hasn’t gotten enough premiums to cover the payout. Insurance works well for inflating assets, not so much for deflating.

Re: Celsius Execs Cashed Out $40M in Crypto Before Halting Withdrawals for Customers

#317

Earlier quoted context omitted.

Monero and other less well-known currencies solve all of that. You can say it's bad or useless for other reasons. But my direct experience with dozens of P2P transfers, outside exchanges, both paying people for products and services and being paid myself, is enough for me to know that the future involves private cryptocurrencies one way or another. It may be akin to the taboo nature of torrenting movies at some point…

Yeah, and pretty much nobody cares: https://bitinfocharts.com/comparison/monero-transactions.htm... 20K transactions per day currently? A single city would have more transactions than that just from people having breakfast in the morning. And these are world-wide stats.

Ah c'mon gimme something better to chew on, this argument is cake to dismantle. (1) You don't use Monero to buy breakfast. It's for large money transfers so at least compare it to bank wires. (2) Very few people know about Monero yet. Credit cards were at 20K transactions per day at some point. If you know how to look at the chart you linked, you can see the TX count growing sustainably over several years. This is healthy growth, not some SV venture-capital juiced unicorn. (3) There will be very few ultimate winners in the crypto game as far as fungible currencies. It's a more honest comparison to include transaction counts of non-fungible cryptocurrencies like BTC and ETH that people are unfortunately using as a currency for now. (4) Monero is just one of a few other legitimate private cryptocurrencies, so include those transaction counts too.

Well I could go on laughing at the "nobody cares" take, but you don't care so I'll leave it there. Enjoy your CBDCs in the metaverse.

Re: Celsius Execs Cashed Out $40M in Crypto Before Halting Withdrawals for Customers

#318
post #313

Earlier quoted context omitted.

You make an NFT, and then you get a loan that you use to purchase the NFT, and if you don't repay the loan the owner gets to keep the NFT? It seems that you're financing the purchase of something you already owned. And of course the supposed financing is being done by this "pre-approved loan" which you tell us absolutely nothing about. What is that? A loan agreement? What does the agreement say and how is it enforced…

I mean Person A makes an NFT and lists it for sale for $X USDC. Then Person B, who only has $Y USDC ($Y If Person B repays the loan within T days, the lien is removed, so Person B owns it free and clear. Otherwise, the NFT is transferred to Person C. The pre-approved loan would just be a message signed by Person C, granting anyone permission to transfer a certain amount out of Person C's account if (in the same trans…

I see... yes I think such a mechanism could be used to finance the purchase of an NFT. So, I'll admit that I was wrong. You can do financing with a smart contract, although from what I gather you'd be limited to buying NFTs. Not terribly useful, but congrats on coming up with this example.

Re: Celsius Execs Cashed Out $40M in Crypto Before Halting Withdrawals for Customers

#319
post #33

Oh hey look the consequences of a monetary system that isn't backed by a legal system (that is backed up by people with guns). The reason fiat money works is because at the end of the day if you run into trouble you have the legal system to make things right. And if the perpetrator of the crime doesn't listen to the legal system, there are people with guns/violence to back that up. That's why the whole system works -…

loose -> lose

Re: Celsius Execs Cashed Out $40M in Crypto Before Halting Withdrawals for Customers

#320
post #302

Earlier quoted context omitted.

Can't wait until all your crypto disappears because of an off by 1 bug:0 I guess that is the ultimate question - Does crypto actually solve a problem? Or at the very least solve some problems without creating more intractable problems in the process. I definitely remember it being touted as an inflation hedge. How'd that workout? Or that you cannot create more than X amount of Bitcoins - until they split the ledger.…

I honestly don't understand how any self-respecting software developer wouldn't be excited by programmable money. I have wanted programmable money for almost a quarter of a century now, ever since I was consulting for a bank on their first website back in 1998. The centralized banking system simply refuses to do it... they barely even give me API access for taxes and accounting purposes, much less being able to autom…

> I honestly don't understand how any self-respecting software developer wouldn't be excited by programmable money.

Saurik, it is HN, where people complain endlessly about Paypal, but never want to fix it because that would be 're-inventing banking'.

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