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Crypto exchange AAX suspends withdrawals

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Re: Crypto exchange AAX suspends withdrawals

#491

Post by b112 »

hristov wrote: post #477
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 crypto community is very much to blame for this. Initially, back when bitcoin was hovering about $1 per coin, everyone was talking about personal wallets, and educating people how the wallet was just a bunch of numbers you can write on a piece of paper and which you can keep hidden in the lining of your pants, etc. But then bitcoin started getting popular and emerging towards mainstream culture, the talk about wa…

Greybeard here. This just sounds like AWS to me. The cloud! The wondrous cloud!

Re: Crypto exchange AAX suspends withdrawals

#492

Post by remram »

hristov wrote: post #477
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 crypto community is very much to blame for this. Initially, back when bitcoin was hovering about $1 per coin, everyone was talking about personal wallets, and educating people how the wallet was just a bunch of numbers you can write on a piece of paper and which you can keep hidden in the lining of your pants, etc. But then bitcoin started getting popular and emerging towards mainstream culture, the talk about wa…

Is that the right takeaway? People didn't know cryptocurrencies could be kept on your computer? Or could it be that users just don't want to deal with the complexity enabled by cryptocurrencies, and the bank model is just the natural one that always appears when the public starts making use of money?

Re: Crypto exchange AAX suspends withdrawals

#494

Post by nulbyte »

constantcrying wrote: post #85
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 exchan…

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

Yes they should. A deposit liability arises from the fact that they received an asset in a deposit transaction. Liabilities and assets aren't mutually exclusive in any transaction, and both must increase when you receive a customer's deposit, or else where does the liability come from?

> 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.

If the exchange doesn't spend assets they received from their customers, they still have assets. If they sit on them until they receive instruction from a customer to dispose of it, it's still an asset on their books until they carry out the instruction.

Re: Crypto exchange AAX suspends withdrawals

#495

Post by rchaud »

stefan_ wrote: post #151
tinco wrote: post #108

Earlier quoted context omitted.

You can say that, but when MtGox went bankrupt, and also lost 4 fifths of its stored crypto, the court just heaped together all assets into one big pile and all creditors into one big pile and let them fight it out. So now there's a bunch of assholes including but not limited to Peter Vessenes, that are suing the bankrupt entity for billions (completely frivolous of course) and all the depositors have waited for 8 ye…

Crypto isn't money. You are not a bank customer depositing cash. I'm not sure why their customers should be creditors at all, it's a bit like asking GMail for your emails back when Google goes bankrupt.

Gmail lets you download your emails to a POP setup on your local disk. That's more than reasonable IMO.

Re: Crypto exchange AAX suspends withdrawals

#496

Post by logicalmonster »

dmitrygr wrote: post #468
logicalmonster wrote: post #460

Every new form of money and trade had the people learning important financial concepts and took many, many years to start to iron out their weaknesses through better technology or best practices. For instance, when barter and basic trade was used, people had to figure out new methods to do accounting and record-keeping: whether through sticks, tablets, papyrus, etc. It seems simple now, but these basic methods were i…

> there can be no circumstance that changes the fact that Bitcoin only ever has 21 million units and cannot ever be inflated Yes it is deflationary, which is worse for a currency. Why buy anything with a currency whose value will always rise? Better to just hold it. Thus it fails as a currency

> Yes it is deflationary, which is worse for a currency.

Cui bono?

Who told you that deflationary currencies are inherently bad? Perhaps you're repeating this lesson from central bankers and politicians who would have no ability to manipulate for power if they didn't have the printing press.

> Why buy anything with a currency whose value will always rise? Better to just hold it. Thus it fails as a currency

IMO, this has always been a dumb criticism of a deflationary setting.

People still save their money in an inflationary setting and will also spend during deflation because people still need to eat and live their lives. Certainly people would tend to be more cautious about their spending during deflation: not inherently a bad thing.

Re: Crypto exchange AAX suspends withdrawals

#498

Post by throwayyy479087 »

zzleeper wrote: post #335
ceejayoz wrote: post #75

Earlier quoted context omitted.

> How can it be a reserve to hold your own or other "coins" ??? It isn't. They're defrauding folks. Tether got caught doing exactly this, passing money around between themselves and Bitfinex (same ownership) to pad out reserves for an attestation. https://ag.ny.gov/press-release/2021/attorney-general-james-... > In the face of persistent questions about whether the company actually held sufficient funds, Tether publi…

And still, Tether's market cap is many times higher than it was in 2017 or 2018... are investors just too stupid?

Those still putting money are

Re: Crypto exchange AAX suspends withdrawals

#499

Post by alasdair_ »

endorphine wrote: post #48
rapsey wrote: post #36

Earlier quoted context omitted.

Crypto has really only lived in a zero interest rate policy world and it is shitting the bed majorly now when rates are going up. It is likely far from the bottom.

Why do you believe that is the case? How is this hypothesis explained?

Crypto is highly correlated with equities and is sensitive to interest rates in the exact opposite way than you'd expect for something that is supposed to be inflation-proof.

As a simple example: BTC stopped dropping and actually rose $1000 on Thursday when the CPI numbers came out indicating that inflation grew less than expected last month. This shouldn't happen if crypto was actually an inflation hedge. Instead, almost all of crypto's value is speculation-based and so when the supply of money is more expensive (i.e. higher interest rates), the value of crypto assets in USD tends to decline and vice versa when interest rates are predicted to be lower (or not rise as much as expected).

Re: Crypto exchange AAX suspends withdrawals

#500

Post by warinukraine »

ethanbond wrote: post #425
warinukraine wrote: post #231

Earlier quoted context omitted.

> But you realize that banks (and individuals) could have all the advantages of decentralization if they just chose to be decentralized too, right? What are the advantages of decentralization in this context? Be specific.

Namely no risk of you losing your assets due to technical glitch, fraud, or overextension. Of course this is not a substantial advantage, especially in the US, given the various non-technical (i.e. legal/cultural) guarantees against these failure modes. It doesn't overcome the disadvantages of e.g. having to physically protect your own assets - thus why people tend to use financial institutions.

Exactly, this isn't an advantage. If there's a technical glitch, there's insurance for that.

What else?

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