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Is this the end of crypto?

economist.com

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Re: Is this the end of crypto?

#31

Post by Nursie »

Laaas wrote: post #10

The mainstream response to this debacle is a bit incomprehensible. FTX was the antithesis of cryptocurrency; it was a centralised exchange, that was also trying to become a bank, and was AFAICT trying to kill DeFi [0]. The failure/success of FTX has no relation to the soundness of cryptocurrency. I do however hope that this crash means fewer people will speculate on the prices such that it can finally stabilise a bit…

It was everything cryptocurrency - flim-flam, inflated values, the whole thing being based on hot air, technological pipe-dreams and unrealistic ideals.

Like it or not, this is the cryptocurrency ecosystem, and it has everything to do with cryptocurrency being an unregulated wild west of dodgy finance, scams and fraud. Cryptocurrency has enabled this stuff.

You might not like that this is where it's gone, but it is a direct consequence of the ideals of unregulated 'money'. The scammers and the chancers move in, because why wouldn't they? Create a system that is resistant to regulation and open to so much exploitation and they will exploit.

The problem with hoping for stable valuations is that very, very few people are interested in that, because they can't get rich off it. I too hope that all of this crap dies and cryptocurrency goes back to being a handful of cypherpunks swapping tokens around, because at that point the great ripoff and fraud on the general public will have come to an end.

Let's regulate all this the fuck out of existence. Sounds like everyone will be happy.

Re: Is this the end of crypto?

#32

Post by dragontamer »

Fundamental issues of cryptocurrency economy:

1. Biggest pushers are seemingly tech-bros from FANG companies. These companies are laying off staff in record numbers. The biggest cryptocoin believers therefore, will have less income than ever before (in ~3 months or so, after their severance is paid, they'll have to start drawing on savings if they didn't get a job yet... and getting a job in this economy is going to be harder)

2. Fed Rate hikes. Cryptocoins and stablecoins (especially "staking" concepts) were rationally attractive when your savings account returned 0% and when Treasury Bonds were 0.1% to 1.5%. A risky yield-earning instrument may have been... erm... risky, but it seemed like even with the risks you'd beat a savings account. Today, HYSA savings accounts are 3% and the St. Louis Fed President argues they're going to 5%. Its a much more difficult to sell yield-making instruments (such as "staking" Ethereum) when the "safe" risk-free rate is at 5%.

3. Inflation. Instead of being a hedge on inflation, cryptocoins collapsed in the face of it. There are still inflation worries in the economy.

4. Mainstream awareness. Earlier this year, Cryptocoins bombarded the typical normie with advertisements. Matt Daemon said "Fortune favors the bold" for Crypto.com. FTX had Larry David do ads for them. FTX bought out the Miami Heat stadium naming rights. NFTs were on talk-shows, being shilled by Jimmy Fallon and Paris Hilton. Cryptocoin's era of growth is over, everyone is now "aware" of cryptocoins and adjacently NFTs. Entering the public consciousness only happens once, from now and forever more, people are "aware" of cryptocoins and have formed opinions on it. It will not happen again.

5. Scammy reputation. The Celsius and FTX bankruptcies are in the public consciousness. (See #4: for many people, FTX was the public face of cryptocoins thanks to their superbowl ads). That these institutions couldn't even last 1 year after their commercial will forever damage cryptocoin reputation. Sure, Mt. Gox had similar issues back in 2014, but Mt. Gox didn't buy the naming rights to a stadium or host Superbowl commercials.

Seeing cryptocoins grow under these circumstances seems like a longshot to me.

Re: Is this the end of crypto?

#33

Post by frereubu »

whatwherewhy wrote: post #19
Victerius wrote: post #16

Earlier quoted context omitted.

> FTX was the antithesis of cryptocurrency No true scotsman. "The USSR wasn't real communism." What cryptocurrency could be or should be in an ideal world is irrelevant. If cryptocurrency fails to live up to its ideals, it may be because these ideals are impossible to fulfill. That could be due to technological limitations, human nature, or something else. And in this case, we have no choice but to judge crypto for w…

I'm a user of Bitcoin and I never used any exchange.

That's irrelevant to the comment you're responding to. The point is that there may be people who use it rationally, but how it works in the real world now that it's leaking out beyond its initial user base is getting really problematic.

Re: Is this the end of crypto?

#34

Post by colesantiago »

whatwherewhy wrote: post #19
Victerius wrote: post #16

Earlier quoted context omitted.

> FTX was the antithesis of cryptocurrency No true scotsman. "The USSR wasn't real communism." What cryptocurrency could be or should be in an ideal world is irrelevant. If cryptocurrency fails to live up to its ideals, it may be because these ideals are impossible to fulfill. That could be due to technological limitations, human nature, or something else. And in this case, we have no choice but to judge crypto for w…

I'm a user of Bitcoin and I never used any exchange.

So when are you going to sell your Bitcoin when it goes to $5K or more realistically less than $5K?

Re: Is this the end of crypto?

#35

Post by wollsmoth »

kojeovo wrote: post #28
Laaas wrote: post #10

The mainstream response to this debacle is a bit incomprehensible. FTX was the antithesis of cryptocurrency; it was a centralised exchange, that was also trying to become a bank, and was AFAICT trying to kill DeFi [0]. The failure/success of FTX has no relation to the soundness of cryptocurrency. I do however hope that this crash means fewer people will speculate on the prices such that it can finally stabilise a bit…

Aren't basically all of crypto transactions facilitated by centralized exchanges? Why is FTX alone the antithesis?

Probably most of the ones exchanging fiat for cryptocurrency. But you can use defi if you want to swap crypto for crypto, and you can always send direct to buy something, although most merchants probably immediately convert to fiat using an exchange.

Re: Is this the end of crypto?

#36

Post by certifiedloud »

whatwherewhy wrote: post #19
Victerius wrote: post #16

Earlier quoted context omitted.

> FTX was the antithesis of cryptocurrency No true scotsman. "The USSR wasn't real communism." What cryptocurrency could be or should be in an ideal world is irrelevant. If cryptocurrency fails to live up to its ideals, it may be because these ideals are impossible to fulfill. That could be due to technological limitations, human nature, or something else. And in this case, we have no choice but to judge crypto for w…

I'm a user of Bitcoin and I never used any exchange.

Genuine question: How do you use it? Do you mean you use it to make purchases, or do you mean you hold it as a store of value, and that's the use? Something else?

Re: Is this the end of crypto?

#37

Post by AtlasBarfed »

mjburgess wrote: post #9

This is just such an awful betrayal of their mission. The Economist should know better, and everyone I have spoken to which is senior in their readership does know better. This is still a pro-crypto-scam article. They repeat the same scam-artist lies, crypto is somehow an innovation in "trust", somehow more "efficient" than existing infrastructure, somehow "smart contracts" are more reliable than actual contracts. Th…

The Economist represents a world viewpoint from the days of the United Kingdom: as in a small island nation with a monarchy exerting centralized economic control over a vast worldwide imperial empire.

Why would they like cryptocurrency in any way, unless the Bank of England had monopolistic control over it?

Re: Is this the end of crypto?

#38

Post by ren_engineer »

Laaas wrote: post #10

The mainstream response to this debacle is a bit incomprehensible. FTX was the antithesis of cryptocurrency; it was a centralised exchange, that was also trying to become a bank, and was AFAICT trying to kill DeFi [0]. The failure/success of FTX has no relation to the soundness of cryptocurrency. I do however hope that this crash means fewer people will speculate on the prices such that it can finally stabilise a bit…

awfully convenient how SBF was highly connected to the current leaders of the Federal Reserve and SEC and all this went down right as they are pushing for a Central Bank backed digital currency and gives them the perfect excuse to try and kill off actual crypto

thesis-antithesis-synthesis

Re: Is this the end of crypto?

#40

Post by rhn_mk1 »

Victerius wrote: post #16
Laaas wrote: post #10

The mainstream response to this debacle is a bit incomprehensible. FTX was the antithesis of cryptocurrency; it was a centralised exchange, that was also trying to become a bank, and was AFAICT trying to kill DeFi [0]. The failure/success of FTX has no relation to the soundness of cryptocurrency. I do however hope that this crash means fewer people will speculate on the prices such that it can finally stabilise a bit…

> FTX was the antithesis of cryptocurrency No true scotsman. "The USSR wasn't real communism." What cryptocurrency could be or should be in an ideal world is irrelevant. If cryptocurrency fails to live up to its ideals, it may be because these ideals are impossible to fulfill. That could be due to technological limitations, human nature, or something else. And in this case, we have no choice but to judge crypto for w…

This is a silly criticism, as long as the concepts of "cryptocurrency as a decentralized idea" and "cryptocurrency as many people use it in practice" are described by a single word.

If the article is correct about "practicurrency", then you're responding to someone saying that it won't affect "decencurrency". One of them is indeed not a Scotsman. All you're saying is that the word has more than one definition for two wildly different things.

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