831–840 of 843 posts
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Recent collapses have shown that Crypto exchanges are more like a casino grafted to a Ponzi scheme.
Which is remarkably similar to a bank grafted to a hedge fund.
Also you're completely wrong here. Banks aren't a ponzi scheme. That's the stock market.
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There are some 0 fees exchanges, often requires significant volume or occasionally it's for limited periods and/or on a small list of pairs, but I wouldn't be suprised that someone's running fractional reserve with an exchange and offers 0 fees because they make money elsewhere.
You have to be. There is no money to be made at 0 fee exchanges unless you lend the money out or give unfavorable swap rates
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They should make money in the same way that the New York Stock Exchange does - by taking a small fee from every trade.
That's how they made their money for most of their existence, and how crypto exchanges still do, but not anymore. The NYSE actually makes most of its money now by charging for colocated server space which HFT's use to get super low latency connections to the market.
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…
The problem is that the people who run the exchanges can't stop themselves from using customers' money to try to get rich. In theory it is possible that an exchange could just take customer money, keep it in a lockbox, and make their revenue by charging transaction fees. But does that ever happen? The kind of people who are so into crypto that they build a business out of it are fundamentally incapable of that kind o…
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Gold is not even keeping track with the S&P500 vs inflation. You're also conflating a savings/checking account with investing. Totally different issues. This is why people really shouldn't listen to random users for financial advice.
> You're also conflating a savings/checking account with investing As I understand, investing is a risk because you can lose everything and nobody will compensate you. Investments are not covered by FDIC insurance or similar systems in other countries. But as for gold, your gold will stay with you unless the government decides to confiscate it.
You're infinitely more likely to get robbed than the bank is to fail or the S&P500 is to go to zero. Also, as I said most people invest in gold indirectly and they hold a certificate that says they hold X amount of gold. Idiots store gold at their property and the exchange rates for buying/selling make this by far one of the worst strategies.
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https://www.youtube.com/watch?v=oRLON3ddZIw
https://youtu.be/x5RCfQyTDFI
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> And once the user has confirmed the transfer, the software could send the coins to a different address, right? No, the destination address and amount to send need to be confirmed on the hardware wallet. The hardware wallet cryptographically signs the entire transaction with the private key, so the software in the user's computer or mobile phone cannot change the transaction without the signature becoming invalid.
The software in the user's computer can't, but the software in the hardware wallet can. It's probably more secure than running the software on a conventional computer, this I can see.
This way they could watch all the value stored in their wallets and steal whatever they wanted by making it look like you did it yourself when one had a large enough balance to be useful.
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Defi is not this. In defi exchanges you place your coins into a smart contract or have them always on your account. If anything a crypto exchange is a misnomer as it's not even needed. The only reason it exists is because smart contracts didn't exist when they first started.
>The only reason it exists is because smart contracts didn't exist when they first started. Calm down. That is not true. Smart contract based exchanges do not let people exchange real money into crypto. There will always need to be offchain exchanges for trading USD for crypto. Additionally, trading off chain is much cheaper than on chain. Centralized exchanges will always exist because people want on / off ramps, pe…
> Calm down. That is not true.
It pretty much is. Bitcoin's solution to scripting exploits was to weaken scripting. It would have been impractical to use BTC for defi and more work was undergoing to fix those problems. The weasels snuck in at the beginning and now that we can do without them they're already in the walls.
> Smart contract based exchanges do not let people exchange real money into crypto.
For trading there are a couple of options (aside from Tether, which is a scam) for pegging a trade to USD.
For on/offramp, you are sorta right. If I want to trade for strawberries I need someone holding strawberries, and I have a risk he'll give me raspberries.
> Centralized exchanges will always exist because people want on / off ramps, people want low fees
On/off ramps don't require centralization, they only require one legally bound actor, and we can all pick our fave. You may trust a lawyer near you, I may trust my local gold bullion store for up to $5k at a time, etc.
Low fees are far better achieved by a channel or rollup based solution, where the assets are essentially on-chain the entire time.
> and because people are willing to trust others.
This is bad argument. You're trying to make trust virtuous even though removing the need for trust is far better for society - removing risk and friction for everyone.
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The risk of misplacing your keys/passphrase or getting hacked with it in plaintext on your computer may be higher across the end-user population.
"May be higher" is a gross understatement. Is "provably much higher" is closer to the truth.
But if you're the type of trader who makes a trade and then forgets about it for a while you're at risk of losing the funds left on the exchange - like with Paypal.
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> Except the fact that bitcoin needs continuous internet access and electricity. > The first can be blocked by oppressive government. First of all, bitcoin users don't need continuous internet access. At best, they need intermittent internet access. It's also possible to use Bitcoin without internet access. Nowadays you can send and receive Bitcoin transactions over satellite, SMS and I think even over radio, no Inte…
> It's also possible to use Bitcoin without internet access. Nowadays you can send and receive Bitcoin transactions over satellite, SMS and I think even over radio, no Internet required. All of these mean: continuous easily available connection at any point. And to send anything through SMS or radio? Again. First. World. "To send Bitcoin (or any cryptocurrency) over ham radio you need to download the apps TxTenna and…
What good is a book on gardening when you're hungry right now? What good is a herd of cows when you need to put out a fire? You sound like an anti-second amendment person asking if we intend to use our guns to shoot down an f35 fighter.
No, bitcoin and crypto aren't going to be the savior for someone who wakes up in Mosul in the middle of the fighting.
But they might be a way out of the country with wealth intact, the difference between being a penniless refuge and a valued citizen.
> Again. First. World.
You're using first/second/third world incorrectly labels, and you're wrong. Even in the poorest places in the world, and the most war torn, we see people with their mobile devices and tiny solar panels, or charging from a merchant with a larger panel.
> continuous easily available connection at any point
No, you really don't need that. You could produce a signed transaction alone, disconnected from everyone, on your phone, and represent it as a QR code with bushes in your backyard and I could scan it from a satellite photo, decode it, and submit it to the blockchain.
This is far fetched but the point is that the transaction can be made alone and offline, transmitted to the blockchain by any means even over months or years, without risk of being modified on the way. You could hide these in letters overseas, or boxes of goods, etc.
> Instead of, you know, actual cash, barter, and storing valuables in actual valuables.
If I was you I'd list all the ways that cash and valuables can be taken and that barter might be for broken or worthless goods. Instead I'll summarize as "there are risks in everything".