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Crypto exchange AAX suspends withdrawals

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Re: Crypto exchange AAX suspends withdrawals

#81

Post by 0xAFFFF »

brnt wrote: post #33

So, having been around since the early bitcoin days, core to the salespitch back then was the fact you would have control. You'd have your coins in your wallet, and no need for banks etc. Apparently nobody does this anymore, and gives their wallets to these exchanges (i.e. banks) and balks when the obvious happens in pyramid schemes. People just don't get distributed currency if they promptly undistribute it. Or is i…

The core truth in this day and age is that nobody (understand this a non-significant minority if you prefer) wants to host their own stuff. It's way more convenient to use centralized services that do the heavy lifting for you. If you don't have that convenience, you can't have mass adoption.

Re: Crypto exchange AAX suspends withdrawals

#82

Post by manholio »

djbebs wrote: post #24
jakelazaroff wrote: post #14

Earlier quoted context omitted.

Is this… sarcasm? It’s a good thing that crypto exchanges are streaming their customers’ money?

I'm 100% serious. Exchanges are not and should not be banks. They should not be comingling their assets with client assets.

Yes, exchanges shouldn't commingle their assets with clients funds, yet they have large operational outlays (coding &security, traditional financial fees, meth & luxury condos in Bahamas, etc.) that seem unlikely to be coverable with trading fees alone. Even if we allow them to work like banks, they still can't seem to justify the tens of billion valuations.

Re: Crypto exchange AAX suspends withdrawals

#83

Post by mattbrewsbytes »

brnt wrote: post #33

So, having been around since the early bitcoin days, core to the salespitch back then was the fact you would have control. You'd have your coins in your wallet, and no need for banks etc. Apparently nobody does this anymore, and gives their wallets to these exchanges (i.e. banks) and balks when the obvious happens in pyramid schemes. People just don't get distributed currency if they promptly undistribute it. Or is i…

I think once crypto gained traction beyond early adopters into more mainstream people it became an "app" and that "app" was the exchange and non tech, non crypto people don't put more effort into it then that.

What is alarming and becoming more revealing is how much of this crypto was being back-doored from one crypto "product" (exchange, fund, coin, ICO, etc.) into another. In programmer terminology: it looks like there are (were) a lot of pointers to the same memory address.

Re: Crypto exchange AAX suspends withdrawals

#84

Post by nemo44x »

These guys won’t be around in 2 weeks. Clearly they are experiencing a liquidity crisis and are buying time, hoping to somehow get needed funds in that time.

Scams always end this way - the exit gets crowded as more people are trying to get out than are coming in and it unravels.

Re: Crypto exchange AAX suspends withdrawals

#85

Post by constantcrying »

lbriner wrote: post #7

Forgive my ignorance but it seems that one major problem with crypto-exchanges is that they don't necessarily have any assets other than the crypto that has been deposited there, which means all overheads (which I am assuming for some of these guys is $Ms/year) can only come from trading crypto unless they are charging reasonable money for the privilege of using their exchanges. In the FIAT world, banks make tonnes o…

An exchange shouldn't count deposited crypto as their asset. It is an asset of their customer.

I do not think the actual problem here is crypto exchanges being unprofitable. Even if a crypto exchange goes under, it could (and frankly should) still be able to go under gracefully, e.g. letting all customers withdraw their assets for a month (and E-Mailing private keys as a last resort). The issue here is crypto exchanges severely mismanaging the assets of their customers.

Banks need to be heavily regulated because they are investing the assets of their customers. An exchange should not be doing that, it should be holding customer assets and making them available on request.

Re: Crypto exchange AAX suspends withdrawals

#86

Post by hotpotamus »

flanked-evergl wrote: post #42
oneoff786 wrote: post #31

Earlier quoted context omitted.

In the fiat world banks are regulated and can’t do crazy shit with their reserves.

In the real world all organizations are regulated and fraud is illegal. But sadly something being illegal does not prevent if from happening, and greasing political palms always help: https://fortune.com/2022/11/10/sam-bankman-fried-ftx-joe-bid... ( https://archive.ph/BBpQN#selection-417.0-424.0 ) > The 30-year-old Bankman-Fried has been a major force in Democratic politics, ranking as the party’s second-biggest indi…

It would seem that there are other failures and frauds predating Bankman-Fried, wouldn't it?

While I'm told that the ideological and technical underpinnings of crypto are designed to avoid government regulation, I hope that he is prosecuted thoroughly for any crimes he may have committed.

But further, I hope that this high profile Democratic donor drives Republicans in the House and Senate to support strong regulation on this burgeoning financial asset class/stateless currency (I'm still unsure of what it is). And in fact stronger regulation on the financial industry generally.

Re: Crypto exchange AAX suspends withdrawals

#87

Post by noelsusman »

lbriner wrote: post #7

Forgive my ignorance but it seems that one major problem with crypto-exchanges is that they don't necessarily have any assets other than the crypto that has been deposited there, which means all overheads (which I am assuming for some of these guys is $Ms/year) can only come from trading crypto unless they are charging reasonable money for the privilege of using their exchanges. In the FIAT world, banks make tonnes o…

It gets fixed by largely replicating the traditional finance system, which would of course be completely pointless. The whole point of crypto is to evade government regulations, which means this kind of stuff is inevitable.

Re: Crypto exchange AAX suspends withdrawals

#88

Post by tomjakubowski »

brnt wrote: post #33

So, having been around since the early bitcoin days, core to the salespitch back then was the fact you would have control. You'd have your coins in your wallet, and no need for banks etc. Apparently nobody does this anymore, and gives their wallets to these exchanges (i.e. banks) and balks when the obvious happens in pyramid schemes. People just don't get distributed currency if they promptly undistribute it. Or is i…

I think so many cryptocurrency users avoid maintaining their own wallet for the same reasons most people (these days) don't store all their wealth as cash or gold under the mattress: it's both inconvenient and easy to lose.

Of course what folks are seeing now is that it's real easy for exchanges to lose their buttcoin deposits too.

Re: Crypto exchange AAX suspends withdrawals

#89

Post by JumpCrisscross »

knorker wrote: post #79
brnt wrote: post #33

So, having been around since the early bitcoin days, core to the salespitch back then was the fact you would have control. You'd have your coins in your wallet, and no need for banks etc. Apparently nobody does this anymore, and gives their wallets to these exchanges (i.e. banks) and balks when the obvious happens in pyramid schemes. People just don't get distributed currency if they promptly undistribute it. Or is i…

You're not taking crazy pills. It's become abundantly clear that the vision of everybody being their own bank will never work. People don't want to be their own bank, just like they don't want to be their own bakery, or their own farmer. Sure, some people do bake their own bread, but they do it either because they have to, or because they enjoy it. So the people who control their own keys need to have a reason to do…

> You want to hold more cash than FDIC guarantees

This is a solved problem up to millions of dollars [1]. Past that, you buy Treasuries. The real third case is you’re doing something illegal.

[1] https://accountopening.fidelity.com/ftgw/aong/aongapp/fdicBa...

Re: Crypto exchange AAX suspends withdrawals

#90

Post by rhaway84773 »

spywaregorilla wrote: post #72
flanked-evergl wrote: post #42

Earlier quoted context omitted.

In the real world all organizations are regulated and fraud is illegal. But sadly something being illegal does not prevent if from happening, and greasing political palms always help: https://fortune.com/2022/11/10/sam-bankman-fried-ftx-joe-bid... ( https://archive.ph/BBpQN#selection-417.0-424.0 ) > The 30-year-old Bankman-Fried has been a major force in Democratic politics, ranking as the party’s second-biggest indi…

SBF spent about 33% Republican / 66% Democrat EDIT: Not accurate ^ Yet 18 of the 25 top donors were Republican leaning. Billionaires comprise 20% of Republican funding vs. 14% for Dems. Most republican megadonors were entirely republican. The big ones are from hedge funds. So yeah, SBF donated to the dems. We need more regulation to get money out of politics. But let's not kid ourselves into thinking the republican p…

Good post.

> 96% of house seats were won by the party that spent more in their race.

I don’t think the causality here is clear. A lot of companies/billionaires/millionaires and even regular people tend to donate money towards the people who are likely to win the race. If you wanna be in the good graces of the person representing a certain district in the House the best way to do that is to make a bet on the likely winner ahead of the elections.

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