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BlockFi files for bankruptcy as FTX fallout spreads

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Re: BlockFi files for bankruptcy as FTX fallout spreads

#91

Post by fdgsdfogijq »

herval wrote: post #78
fdgsdfogijq wrote: post #50

Earlier quoted context omitted.

I talked to an employee that left last spring. She said they had literally no idea what they were doing. The founders are just ivy educated 30 year olds. So they decided to just start hiring everyone they could from paypal, to move into "blockchain payments". They paid huge sums. The directors there had no experience ever managing huge teams of people. It was a giant mess of unqualified people funded by cheap capital…

That's pretty much how a lot of "unicorns" felt in the past 2-3 years

With all of the capital they have, you would think they would hire competent people from big tech. Instead they just find some stanford grad with a few years of experience to manage 50 people. It doesnt even make sense

Re: BlockFi files for bankruptcy as FTX fallout spreads

#92

Post by clintonb »

napolux wrote: post #38
simple-thoughts wrote: post #3

With projects like blockfi, users get all the disadvantages of the centralized traditional financial system without any of the regulatory protections that have built up over centuries. Terrible for the people with assets in blockfi but extremely predictable. The point of defi is that you can use financial services without a centralized counterparty. People who can’t handle their own keys should be using traditional b…

it's fascinating how nobody learned from history. Banks and bankers have been heavily regulated as you said, "over centuries". Still today, we get lured by the same businesses (because all these lenders were just banks/financial operators) but without any of the safety nets we have in place when we work with "old school" banks.

Learning from history typically requires opening a book…

Re: BlockFi files for bankruptcy as FTX fallout spreads

#93

Post by xnorswap »

ceejayoz wrote: post #37
rahen wrote: post #14

Earlier quoted context omitted.

> Sure, but you can't use DeFi to trade fiat for crypto. Of course you can, both ways. - https://bisq.network - https://learn.robosats.com

https://learn.robosats.com/docs/trade-pipeline/ > On a private chat, Bob tells Alice how to send him fiat. https://learn.robosats.com/docs/payment-methods/ > You can pay with any method that both you and your peer agree on. This includes the higher risk method such as PayPal, Venmo, and Cash apps. C'mon, that's not trading fiat for crypto. That's "PayPal me some money".

I love crypto! It's Decentralised! It's Trustless! De-fi is the future!

Then it turns out that the promised future involves trusting someone to honour a paypal and pray you're not being scammed.

Re: BlockFi files for bankruptcy as FTX fallout spreads

#94

Post by woodruffw »

itake wrote: post #83
skrebbel wrote: post #27

Earlier quoted context omitted.

I’m not convinced there’s any destruction of value when the entire value proposition is a lie. When I tell you my lemonade stand is worth a billion, and you believe it for a while, and then you realize it isn’t really, no value was destroyed.

The real losses are the VC capital (that could have been deployed to more meaningful businesses) and the loss of client capital. Many people put their life savings that may or may not evaporate.

I think this is predicated on the assumption that VCs generally deploy their capital wisely, which I don't necessarily buy. Before cryptocurrencies, the rage seemed to be "Uber but for X." I'm not convinced there was much social or financial benefit in most of those, other than cynical value cycles culminating in offloading junk onto public markets.

Re: BlockFi files for bankruptcy as FTX fallout spreads

#95

Post by Stranger43 »

PM_me_your_math wrote: post #21
propter_hoc wrote: post #16

Somehow these guys peaked at about 900 employees, according to linkedin ( https://www.linkedin.com/company/blockfi ) They've raised about a billion dollars of VC - https://www.crunchbase.com/organization/blockfi-inc/investor... (note, CB lists $1.4b, of which 400M is debt from FTX, which I imagine they never got) Unbelievable the amount of destruction of value here... it's just total carnage.

Is it wrong to assume that this is because the industry is mostly built upon a house of cards or because of bad actors? Objectively asking.

Essentially yes.

Bitcoins scalability issue should have killed off al notions that it could ever gain widespread usage as an alternative to traditional currency for regular payments and after that it became yet another speculative derivative without any real backing in real world assets.

It was never actually going to replace fiat currencies for most people and the industry is absolutely dominated by exotic financial instruments(mostly of the ponzi variant), run by a mixture of fools and scammers.

Re: BlockFi files for bankruptcy as FTX fallout spreads

#97

Post by Mistletoe »

woodruffw wrote: post #86
propter_hoc wrote: post #16

Somehow these guys peaked at about 900 employees, according to linkedin ( https://www.linkedin.com/company/blockfi ) They've raised about a billion dollars of VC - https://www.crunchbase.com/organization/blockfi-inc/investor... (note, CB lists $1.4b, of which 400M is debt from FTX, which I imagine they never got) Unbelievable the amount of destruction of value here... it's just total carnage.

Given the amount of handwringing we've seen over the past couple of weeks in re: Twitter's headcount, it astonishes me that we haven't seen anything close to that for these cryptocurrency firms. Twitter ran one of the world's largest social media networks with around 7000 people; what in the world is Kraken doing with ~3400[1]? [1]: https://www.linkedin.com/company/krakenfx

Kraken actually handles money so it needs customer service and Twitter is just a bunch of already written code for posting stuff and sometimes (although much less now!) getting ad dollars.

What do (did) 7000 people do at Twitter? I hate to ask the question because it aligns me with Elon whom I despise right now. But what do all the employees do at tech companies? I thought the beauty of tech and why the valuations were so high is that it scales quite easily since it is all code. What do 32,500 employees at Uber do?

Re: BlockFi files for bankruptcy as FTX fallout spreads

#99

Post by lawn »

postalrat wrote: post #7
simple-thoughts wrote: post #3

With projects like blockfi, users get all the disadvantages of the centralized traditional financial system without any of the regulatory protections that have built up over centuries. Terrible for the people with assets in blockfi but extremely predictable. The point of defi is that you can use financial services without a centralized counterparty. People who can’t handle their own keys should be using traditional b…

What's the cryptocurrency endgame? Everyone has keys in cold storage waiting for the day we have the mathematics that destroys them?

The endgame is a payments system as originally described in the Bitcoin whitepaper.

99.9% of all "advances" and developments in the space hasn't moved us towards the endgame, if anything it's taking us further away.

Re: BlockFi files for bankruptcy as FTX fallout spreads

#100

Post by clintonb »

Auracle wrote: post #51
ARandomerDude wrote: post #15

Earlier quoted context omitted.

That sounds nice in theory, but of course these companies are free to sit down and hammer out professional standards without the government telling them to. "We really want to be told what to do but nobody will" is code for "I'm not doing anything until the government makes me, and I'll redirect blame to the glacially slow government the whole time."

That’s easy to say, but that’s going to make those companies uncompetitive. Look at how fast FTX overtook Coinbase, a long established player that - as far as anyone can tell - isn’t doing anything shady.

Your example undercuts your thesis. Given that FTX no longer exists while Coinbase does, FTX was not competitive in the long term. Being “competitive” for a couple years is typically not the goal of founders or investors.
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