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

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

#131

Post by this_user »

bulbosaur123 wrote: post #69
babypuncher wrote: post #54

Earlier quoted context omitted.

And then they wonder why regular consumers aren't fleeing banks to start using crypto for everything. I've yet to see cryptocurrencies actually solve a problem that your everyday average person has when buying groceries or going out to eat. They just make things more difficult and confusing, and all these attempts to alleviate that just lead us straight to "banks, but worse".

This is what most people got wrong. Crypto solves one problem and one problem only: censorship. Crypto is the only, single censorship resistant asset on the entire earth. You can't remove private key by force ($5 wrench is not an argument). You can confiscate land, stocks, freeze bank accounts, take gold. You can't extract a string of numbers which you aren't even sure is there in the first place. Not yet at least. M…

> Crypto solves one problem and one problem only: censorship

It doesn't even do that properly, because there is no guarantee of service given by the system. Miners could just decide that they don't like you very much and refuse to process your TX. Or they could conspire to blackmail you: "pay us or your tokens are useless". Sure, someone might be willing to process your TX, or you could try to do it yourself, but that might take a long time or it might fail altogether.

Furthermore, as the Ethereum rollback has shown when the original "DAO" was hacked, the vast majority of crypto project have some sort of backdoor that can and will be used.

The only thing crypto "solves" is oversight by governments, and the people who are interested in that the most are criminals or actors who have been sanctioned like North Korea or Russia. Somehow, I don't quite see the value in that.

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

#132

Post by onlyrealcuzzo »

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…

Except ~99.99% of BTC transactions happen in exchanges off chain and aren't visible to anyone, and have a history of being fraudulent at many exchanges that have failed through the years...

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

#133

Post by dimgl »

cs702 wrote: post #116
otoburb wrote: post #107

Earlier quoted context omitted.

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!

I think it's unlikely that, as a technology, Bitcoin will ever go away due to its decentralized nature. I think what most people refer to when they say "Bitcoin will fail" is a price drop so significant it makes the coin worthless (99% drop). This may also never happen, and the reality will likely be somewhere in between.

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

#134

Post by carlosjobim »

misnome wrote: post #86
carlosjobim wrote: post #38

Earlier quoted context omitted.

It's a crime if you or I do it. It's a blessing of quantitative easing when the rulers - our lords and saviors - do it.

Vs the very poor peasants of the people who run the mining companies or control the software? Haven’t you just swapped one set of sovereigns for another?

Except that anybody can mine, just like anybody could mine gold or trap squirrels. To make fiat currency emissions you need to be born into the right family.

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

#135

Post by lbwtaylor »

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…

> 1. ... Well, guess what, regulated industry is no different either.

I disagree, I think the systematic failures and fraud in the crypto industry is much more common than the regulated industry. Madoff is an outlier, not an expectation, and the majority of funds were retrieved. How's that looking for crypto?

As for 2008, my bet is that if crypto was being widely used for mortgage lending at that time, it would have been just as bad as banks. I don't see anything about crypto that would be making safer mortgage loan. In fact, what I see in crypto is very risky loans.

> 2. ... Use case..

I still don't see a convincing use case there.

> 1. Data ... essential commodity ... We need to switch the model and reimagine how the internet should work... bet that in ten years, if nothing is done, we will be living through orwellian future

I don't think banks/brokers are big controllers of data. I am more optimistic and would prefer to use Fidelity or Schwab than defi.

> 2. I wonder what people call US economy if they call crypto pyramid scheme.

I'm not really going to address this deeply, this is really a political view -- that I don't agree with. For decades folks have said the US will implode. When I look around, the US is where I want to put my investments.

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

#136

Post by youreincorrect »

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…

When people talk about Bitcoin's potential demise, they are referring to its price and perceived value, not whether it will cease to exist necessarily.

Madoff also was not ultimately caught and his scheme ended because of the accounting fraud being revealed (i.e. the fraud was not that important). That happened later. He was caught because a market downturn resulted in him being unable to acquire new victims for the Ponzi scheme, which would have otherwise perpetuated it by taking new money in and using that to pay out existing investors.

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

#137

Post by jrm4 »

waynecochran wrote: post #45

With crypto trading platforms, the SEC lacks any sort of oversight and access — and has scant ability to detect, investigate and deter fraudulent conduct. As a result, the crypto marketplace operates without much supervision Isn't that the main idea of a decentralized currency? No doubt this has/does/will harbor criminal activity, but it will also foster the ability to exchange goods and services without third partie…

EXACTLY.

I think one of the oddest things is that I don't much see the following view, which is roughly mine:

I'm generally pro the idea of crypto -- but more importantly, whether I love it or hate it, this particular fight was, or should have been, completely expected and anticipated. As in, this was the point of it; anyone into crypto should 100% welcome this battle, if you were paying attention to the idea?

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

#138

Post by wolverine876 »

uLogMicheal wrote: post #85
wolverine876 wrote: post #39

Earlier quoted context omitted.

Negative comments don't indicate bias. There are many alternative explanations. If I say 'Charles Manson murdered several people', that doesn't indicate bias. If I say it's raining, that's not bias against the weather.

Hopefully you can see the absolutist nature of his comment and come to the realization that crime is a universal aspect of money, so of course any form of money would be a facilitator of it.

> crime is a universal aspect of money, so of course any form of money would be a facilitator of it.

That's irrelevant. The question is whether crypto in particular facilitates crime, and it does. All airplanes facilitate passenger death, but some are far more dangerous than others. If I'm considering boarding a plane, don't tell me 'well, any plane might crash' - I don't care, I care about this plane, this pilot, etc.

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

#139

Post by cs702 »

onlyrealcuzzo wrote: post #132
cs702 wrote: post #102

Earlier quoted context omitted.

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…

Except ~99.99% of BTC transactions happen in exchanges off chain and aren't visible to anyone, and have a history of being fraudulent at many exchanges that have failed through the years...

That's true for gold too: Most gold transactions happen in exchanges. But the fact that there are successful intermediaries in the gold market is not an argument against gold's viability as a store of value. Ditto for Bitcoin.

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

#140

Post by jrm4 »

misnome wrote: post #77
wongarsu wrote: post #48

Earlier quoted context omitted.

Well, you just said that's he's wrong. One "killer application" is that it's a "stable" store of value. Not perfectly stable, it can quickly fall by a factor of about 2, and if you buy in the worst bubble it might fall to a fourth of its value. That's decidedly less stable than Western currencies, but it's more stable than some others. And for many people Bitcoin is more accessible than the foreign exchange market. I…

So, it’s stable as long as you understand it is unstable, and helps people without access to banking but with a stable, constant internet connection and perfect operational security, access none of the benefits of having a bank account. Oh, and it’s actually neither of those but if you wish _reaaaaly_ hard and ignore all the practical problems, it might be, someday.

You're overdramatizing.

Maybe not a lot, but people literally do use it for this purpose everyday. You can't just wave that away, given that it is working to some extent now.

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