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In 2022, Web3 went just great
151–160 of 205 posts
Re: In 2022, Web3 went just great
#152If they think that is bad, wait to see what 2023 brings. When the recession fully hits (and it will), a significant number of smaller FOMO investors will look to withdraw in favour of traditional liquid to cover basic bills (rent, utilities, food, travel, etc). The slow bleed of big crypto names since the peak a few years ago will not attract large new investors and there is nothing currently that indicates it is a good hedge against inflation (see BTC.X over SPX for example).
Once the larger crypto assets lose value, the liquid (crypto) the stable coins hold in cold wallets will of course devalue. The only liquid they hold of value will be traditional hard to liquidate assets, which will simple be used to pay off the big players in the bankruptcy.
Expect this entire thing to collapse pretty quickly when it gets going. We are yet to see real contagion in this space. A lot of people will be left holding worthless coins like every crypto coin bankruptcy so far.
That said, traditional money is no good to you either. Thanks to fractional reserve banking [1] no currency actually has any value any more. It's difficult to suggest where to suggest to invest, but I don't want to get caught holding monopoly money once the game ends [2].
[1] https://en.wikipedia.org//wiki/Fractional-reserve_banking
Re: In 2022, Web3 went just great
#153Earlier quoted context omitted.
Well, let's also not ignore the immense greed involved and its power to overcome run-of-the-mill common sense. Doesn't take much to spot the bullshit in: "Risk-free 7% APY in a time when every single noteworthy financial institution is offering less than 0.5%!"
Only 7%? At the height of the bubble, there were a number of major crypto schemes offering interest rates of 20% or more. Sometimes even much more; some of the shadier "investments" offered >100% APY. Unsurprisingly, most of those schemes have since collapsed.
It’s easy to give 100% APR in a token you’ve created, it’s very hard to keep the market value increasing at a similar rate to offset coin price dropping. Initial hype will support you for a few months but it’s all tears in the end :)
I’m still sort of sad the focus hasn’t been on decent remittance systems, the true useful tool of crypto IMO.
Re: In 2022, Web3 went just great
#154Earlier quoted context omitted.
A proper use of cryptocurrency could have prevented the problem, but FTX and users mutually agreed to give FTX more trust by giving FTX custody of user funds. That's really all it was. Not very interesting.
Ah, the good old “communism would work perfectly but the Soviet Union was doing it all wrong” style argument. Blind faith in an economic theory against all empirical evidence is a dead end.
I have held cryptocurrency in my private wallet for a long time, and have transacted on decentralised exchanges. I have never been the victim of a crypto scam, and my cryptocurrency has never been stolen from me. Separately, in that time, I was the victim of a credit card scam involving amazon, that nobody has been able to adequately explain to me. The empirical evidence staring me in the face is that my cryptocurrency is more secure than the money in my bank.
There absolutely are decentralised exchanges, working extremely well and safe ways to keep your cryptocurrency. I use them. It's very odd to come on here and find people claiming that my experience of cryptocurrency is impossible.
Re: In 2022, Web3 went just great
#155I'm kinda happy with the way things turned out. For a moment, my understanding of reality was upside down with how many mediocre and clearly pointless projects were generating so much money. With every crypto hype cycle, I actually go through the motions and create a smart contract project and become completely disillusioned with the hype. I thought ERC20 tokens were bullshit when I realized it's just updating keys i…
Why would anybody buy an NFT for any other reason than banking on a greater fool?
Art doesn't need blockchain to be sold, and an NFT adds zero value to it.
Re: In 2022, Web3 went just great
#156Earlier quoted context omitted.
Blind faith how so? I merely stated a technical fact. Blockchain is programmable money; they could have programmed a system such that FTX could not run away with user funds – there are defi systems that do this already. But they didn't. Instead, FTX used crypto as a means to transfer funds into their own, centralized custody. Not much different from a bank wire. This isn't a "communism would work perfectly" style arg…
First, you can't program the fiat you need to buy BTC or other tokens at an exchange to have this property - so you're always going to have to trust someone with your money, at least for a time. Second, if these defi systems exist, why are so many still keeping their money on exchanges like FTX/Binance/Coinbase/etc without such protections? I suspect it has to do with convenience or maybe cost - smart contracts requi…
The fact that you can't swap dollars transactionally without trusting an escrow provider or the person you're doing the swap with is a failing of dollars. It's not a failing of e.g. ethereum where you absolutely can set up a smart contract that will do that. Trying to use that as an argument against cryptocurrencies is misguided, and if things go well for cryptocurrency and there's a proliferation of CBDCs or more ways to earn income by being paid in cryptocurrency, it will become irrelevant.
These defi systems do indeed exist and are used by quite a few people (including occasionally me). 'Why are so many still keeping their money on [centralised] exchanges', is a question that a lot of people in the cryptocurrency ecosystem ask themselves despairingly. While UX could be better, it's really not that bad - the real answer is that the vast majority of people investing are 'number go up' investors, used to the stockmarket and regulated brokers, rather than people who actually care about the core ideas of decentralisation, programmable money, etc.
Re: In 2022, Web3 went just great
#157Earlier quoted context omitted.
Blind faith how so? I merely stated a technical fact. Blockchain is programmable money; they could have programmed a system such that FTX could not run away with user funds – there are defi systems that do this already. But they didn't. Instead, FTX used crypto as a means to transfer funds into their own, centralized custody. Not much different from a bank wire. This isn't a "communism would work perfectly" style arg…
What the parent is saying is that "Real X has never been tried" is a common dodge for people defending the indefensible, because it's unfalsifiable. It also fails to take into account human preferences that are preventing Real X. FTX wasn't centralized because they were mustache-twirling villains who hade decentralization, they were centralized because that's what the market demanded, because DeFi is impossible to fu…
> because DeFi is impossible to fucking use so nobody does.
It's actually pretty easy, and a fair few people do. Uniswap v3 currently has a 24h trading volume of $317,196,156, and the app is trivial to use. Curve's app is ugly but not hard to use, and has a 24h trading volume of $199,693,574. Maybe you think those numbers aren't all that impressive, and sure, I'd like the decentralised trading venues to be doing more, but it's a far cry from 'nobody'.
Re: In 2022, Web3 went just great
#158Earlier quoted context omitted.
> but when it comes to crypto sophisticated quants and Joe Bogsly are operating on a level playing field Pretty sure Tether isn’t operating on a level field with Joe Schmoe.
You misunderstood what I am saying. I am suggesting that quants and financiers have no special, privileged access to information. You can make spooky suppositions about Tether fraud, but if millions of documents disclosed didn't reveal a fraud after the whole community pored over them - it's at least as good as any other financial product.
> if millions of documents disclosed didn't reveal a fraud after the whole community pored over them - it's at least as good as any other financial product
Every time Tether has disclosed anything, it’s been caught lying [1]. That anyone thinks Tether has anything close to standard financial disclosure, or is anything but a fraud, is a testament to the ongoing problem of mainstream American financial illiteracy.
[1] https://ag.ny.gov/press-release/2021/attorney-general-james-...
Re: In 2022, Web3 went just great
#159Earlier quoted context omitted.
Because the trustless nature of crypto is present only at the protocol layer of crypto. The application layer, which is what basically all non institutional users of crypto interact with, isn't trustless at all. But also we should remember that pretty much every bank in the US would have FTXed it's customers money in 2008 if the government hadn't bailed them out.
Umm, no. The government forced the banks to take money so people couldn’t tell which ones were in real trouble and which ones were fine.
Because they wanted people to think that all the banks were fucked. That's so much better than just a few. Yeah. That makes sense.
Re: In 2022, Web3 went just great
#160people like to forget that this exact same thing happened in 2017/18 and will probably happen again in a year or 2.