FTX faces potential hack, sees mysterious outflows totaling more than $600M

I don't know if I'd consider this a fair evaluation.

From my observation, the overwhelming majority of failures, collapses, and hacks have had a fairly limited exposure to the Ethereum-style/Solidity-based networks. This even includes the exchange collapses like FTX.

By and large Monero, Litecoin, Bitcoin, Algorand, Cardano, and the other networks that are reasonably isolated from the ETH/Solidity space have been largely unaffected by the majority of the "cataclysm" that the space has seen over the last year or two. I don't see any of these projects closing up shop in the near future and I don't see their communities giving up on them either (maybe with the exception of Bitcoin's refusal to move away from PoW or to introduce more programmability).

Odds are the cryptocurrency space is going to recede for at least a few years once the ash settles but IMHO there are too many projects that have yet to suffer serious thefts (as in actual loss not numbers go up/down) in their communities. Likewise these projects tend to also be the ones with shops that are holding sufficient operating funds in stable assets (i.e. US dollar equivalents & bonds) to continue development for the next 5+ years.

TLDR: The failures, hacks, collapses, etc have had limited effect on a lot of projects outside of the popular/flashy part of the the cryptocurrency space. Those projects still have a more or less assured lease on life for the next half a decade.

I've heard this, but seen no real evidence. As of right now it's hearsay

between this and twitter I'm smiling ear to ear, you love to see it

> A Ponzi scheme is a form of fraud that lures investors and pays profits to earlier investors with funds from more recent investors. Named after Italian businessman Charles Ponzi, the scheme leads victims to believe that profits are coming from legitimate business activity (e.g., product sales or successful investments), and they remain unaware that other investors are the source of funds.

Key phrases:

* the scheme leads victims to believe that profits are coming from legitimate business activity

AND

* they remain unaware that other investors are the source of funds.

Neither of those apply to cryptocurrencies. Nobody believes that Bitcoin conducts business activity, and everyone is transparently aware that other investors are the source of cash-out funds.

> There's net inflows of currency, and net outflows of currency

Commodities (fungible property of market value, like cryptocurrencies) don't have net inflows or outflows. Commodity prices are determined by order books which are in turn determined by supply and demand, not by capital flow. When a buyer and seller meet and exchange money for a piece of property (like a bitcoin), there is no "inflow" or "outflow", property just changes hands.

> there is a systemic bank balance at any one time of currency.

There is no "systemic bank balance at any one time of currency". That's not how cryptocurrency works. Where is Bitcoin's bank account, and what is Bitcoin's bank account balance?

> If outflows exceed inflows for long enough then the balance is drained to zero and the music stops.

Cryptocurrencies have no such inflows, outflows, or "balance". They aren't like investment funds or companies - they behave like physical objects, like beanie babies if you will. The beanie baby crash wasn't caused by any kind of beanie baby "balance" being drained to zero, it was caused by people collectively deciding that beanie babies were no longer worth a premium price.

> Madoff's Ponzi worked up until the 2008 recession hit him with redemptions and outflows and his bank balance got drained.

Bitcoin does not have redemptions, outflows, or a bank account. It's a series of rocks that people trade between themselves, sometimes at a higher price, sometimes at a lower price.

You seem to be confused about the definition of cryptocurrency. Should we go over that next?

Or they got screwed and thought about how to screw the higher ups even more. They never need to cash out the money to do this.

Nobody will ever not be suspicious of SBF and his inner circle again after this hack.

If it were just a big collapse and it went like an ordinary bankruptcy with the creditors getting a haircut, he'd just be considered an idiot. Money mysteriously vanished? Now he's malicious as well, and any court is going to ask SBF where it went, and even if he didn't know nobody would believe it.