Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Former US SEC attorney: 'Get out of crypto platforms now'

twitter.com

Post reply on HN
Print view View original

111–120 of 515 posts

Re: Former US SEC attorney: 'Get out of crypto platforms now'

#111

Post by ttpphd »

rohith2506 wrote: post #87

I am absolutely baffled by how much negative criticism the whole blockchain industry gets here and I would like to understand the reasoning behind it. Most of the arguments fall into these following buckets concluding to "IT MUST DIE" 1. The whole crypto is a get rich quick scheme with predatory practices everywhere. It's a wild wild west with no sort of regulations. Well, guess what, regulated industry is no differe…

"2. I haven't seen a single use case of blockchain in the world yet. This is a valid critic and I do understand."

Hmmm, it doesn't exactly sound like you are "absolutely baffled". You acknowledge that there are astoundingly few good use cases for blockchain.

Re: Former US SEC attorney: 'Get out of crypto platforms now'

#112

Post by delecti »

adgjlsfhk1 wrote: post #100
bulbosaur123 wrote: post #94

Earlier quoted context omitted.

> So, people have no problem - say - redeeming tokens that have been through Tornado? Or trouble redeeming bitcoins that have been through known, sanctioned wallets? Nothing prevents us agreeing to trade those bitcoins for cash or anything else. You are correct that some Bitcoins are "tainted", which is why it's not the absolute, most perfect cryptocurrency. But they are still censorship resistant. That was my point.…

> It's because not even the government can confiscate your Bitcoin. They can really easily do that though. A court can say "give us your keys or you are going to sit in jail until you do and we will record your conversations so if you tell the keys to someone else, we'll sell them"

That's the "$5 wrench" argument rephrased.

It's not much in its favor, but a sufficiently motivated person can resist handing over cryptocurrency better than they can any other asset.

Re: Former US SEC attorney: 'Get out of crypto platforms now'

#113

Post by mminer237 »

cs702 wrote: post #99
HDThoreaun wrote: post #96

Earlier quoted context omitted.

Bitcoin is a horrible store of value. It's incredibly volatile.

Gold is pretty volatile too. Its price has gone up and down between 5x and 10x a few times in just the past century: https://www.macrotrends.net/1333/historical-gold-prices-100-... -- no one sane would call it stable. And yet, despite its volatility, gold has been used as a store of value for millennia .

In the last 5 fives, gold's highest price was 60% higher than its lowest point. That is indeed pretty volatile.

Let's see if Bitcoin is comparably volatile…

Oh, it's highest point was only 1920% higher than its lowest point. That's definitely the exact same as gold. /s

Also, that ignores that gold has been a store of value for millennia. It's almost synonymous with wealth. In a total financial collapse, if all modern technology dies, you can be sure gold will still have value. 99.9% of people have no idea what Bitcoin is besides funny computer money.

Re: Former US SEC attorney: 'Get out of crypto platforms now'

#115

Post by thworp »

cs702 wrote: post #102
otoburb wrote: post #97

Earlier quoted context omitted.

>> If this sounds far-fetched, consider that many smart and smart-sounding people have predicted Bitcoin's demise, and so far all have been utterly wrong Bernie Madoff pulled off one of the largest (literal Ponzi) scams and evidently stated that he started in the 1990s for a run of just over 15 years until being arrested in 2008, although some investigators thought that his fraudulent activities started as far back a…

The comparison to Madoff is not apt. Madoff hid losses by committing accounting fraud, whereas every single transaction in the Bitcoin network is visible to everyone and, moreover, cryptographically verifiable by everyone. As long as the distributed consensus algorithm continues to function, Bitcoin will continue to exist. Period. (Government regulations cannot kill it; they can only drive it underground, as with gol…

No, this is an absolutely ass-backwards argument. To be a currency or a store of value or money (read: to be of any use) it has to be exchangeable for goods and services. Now we can see transactions on the blockchain but we have no idea what that transaction was for. *Nobody* can tell you what a bitcoins worth of wheat is without resorting to exchange rates of bitcoin to actual currencies. But because the entire exchange ecosystem is so illiquid, intransparent, unaudited and rife with fraud there is no way to know how many bushels of wheat you could get for something like 13 BTC.

Re: Former US SEC attorney: 'Get out of crypto platforms now'

#116

Post by cs702 »

otoburb wrote: post #107
rcme wrote: post #105

Earlier quoted context omitted.

The issue I have with the argument is that you can apply it to anything. The fact that Bernie Madoff pulled off a ponzi scheme for years and the fact that "The Lindy effect works until it doesn't" isn't a specific critique of Bitcoin.

Exactly my point. The Lindy effect probably shouldn't be used as an argument for either side of this debate (or any, for that matter). But that's a specific (partial) statement that I saw in the parent comment.

Ah, I see what you mean now. I agree with you on the Lindy effect.

What I meant is that the arguments used by many past predictions of Bitcoin's demise have been proven wrong. Anyone making new predictions of Bitcoin's demise must explain precisely how and why its distributed network would fail. Sorry if that wasn't clear in my comment above!

Re: Former US SEC attorney: 'Get out of crypto platforms now'

#117

Post by yazaddaruvala »

I'm not pro crypto exchanges, but does the SEC really live up to this guy's promises?

> SEC registration establishes critical requirements that protect investors from individual risk and protect capital markets from global systemic risk. The requirements also make U.S. markets among the safest, most robust, most vibrant and most desirable marketplaces in the world.

Does he mean the requirements that continue to allow dark pools[0]?

or the ones that allow arbitrage (theft?) through low-latency order flow[1], prior to high-latency trade execution?

[0] https://en.wikipedia.org/wiki/Dark_pool

[1] https://en.wikipedia.org/wiki/Payment_for_order_flow

Re: Former US SEC attorney: 'Get out of crypto platforms now'

#118

Post by tromp »

cs702 wrote: post #102
otoburb wrote: post #97

Earlier quoted context omitted.

>> If this sounds far-fetched, consider that many smart and smart-sounding people have predicted Bitcoin's demise, and so far all have been utterly wrong Bernie Madoff pulled off one of the largest (literal Ponzi) scams and evidently stated that he started in the 1990s for a run of just over 15 years until being arrested in 2008, although some investigators thought that his fraudulent activities started as far back a…

The comparison to Madoff is not apt. Madoff hid losses by committing accounting fraud, whereas every single transaction in the Bitcoin network is visible to everyone and, moreover, cryptographically verifiable by everyone. As long as the distributed consensus algorithm continues to function, Bitcoin will continue to exist. Period. (Government regulations cannot kill it; they can only drive it underground, as with gol…

> why its network would stop functioning

If it fails, it's most likely because block subsidy will become negligible in a few decades and transaction fees alone won't always provide sufficient security against re-org attacks.

Re: Former US SEC attorney: 'Get out of crypto platforms now'

#119

Post by this_user »

cs702 wrote: post #99
HDThoreaun wrote: post #96

Earlier quoted context omitted.

Bitcoin is a horrible store of value. It's incredibly volatile.

Gold is pretty volatile too. Its price has gone up and down between 5x and 10x a few times in just the past century: https://www.macrotrends.net/1333/historical-gold-prices-100-... -- no one sane would call it stable. And yet, despite its volatility, gold has been used as a store of value for millennia .

That is exactly why most people no longer use gold as a store of value and are instead using currencies that are much more less volatile. Meanwhile, Bitcoin alone has an annual volatility that is about an order of magnitude larger than gold's, and it's even worse in every other crypto token. None of these things come even close to qualifying for being a store of value.

Re: Former US SEC attorney: 'Get out of crypto platforms now'

#120

Post by jcranmer »

rohith2506 wrote: post #87

I am absolutely baffled by how much negative criticism the whole blockchain industry gets here and I would like to understand the reasoning behind it. Most of the arguments fall into these following buckets concluding to "IT MUST DIE" 1. The whole crypto is a get rich quick scheme with predatory practices everywhere. It's a wild wild west with no sort of regulations. Well, guess what, regulated industry is no differe…

> When you think hard about 1&2 and come up with solutions, congratulations, you just reinvented the blockchain. If not, I am happy to hear how would you solve.

Well, I've been thinking about it some, and I don't see how blockchain is even a solution to #1 in the first place, much less presumably the only solution. For data collection concerns, the most natural solution is of course to simply see that data is never collected in the first place, and this can happen via legal means (e.g., GDPR) or technological means (don't include unnecessary sensors).

Post reply on HN