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Bybit loses $1.5B in hack

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Re: Bybit loses $1.5B in hack

#261

Post by crazygringo »

FabHK wrote: post #252
joshstrange wrote: post #206

Earlier quoted context omitted.

Your transfer fees are a bit off. Coinbase is 10,200x more than you stated ($0.51 to send $100) BUT that’s only if I send directly on Coinbase. Coinbase Commerce takes 1% so it would actually be 20,000x more than you listed. Stripe is 64% of what you stated ($3.20), and that’s with no processing fee discounts like you can get with higher volume. Now, obviously, $3.20 > $1 but it’s not apples to apples. You can claw b…

Credit card interchange fees being ridiculously high is pretty much a US thing: > In the United States, the fee averages approximately 2% of transaction value. In the EU, interchange fees are capped to 0.3% of the transaction for credit cards and to 0.2% for debit cards, while there is no cap for corporate cards. Sensible regulation can make a big difference. FWIW, I can pay bills by initiating a transfer both in HK…

It's also not even 2% in reality.

It goes to rewards which go straight back to the consumer.

My main credit card gives me 2% back on all purchases. In cash. Zero annual fee. And it's a card anyone with a normal credit score can get. Nothing special about it.

It really only makes sense to compare interchange fees after subtracting the proportion of them that get paid back to consumers.

Re: Bybit loses $1.5B in hack

#262

Post by snailmailstare »

EVa5I7bHFq9mnYK wrote: post #256
plantain wrote: post #130

How on earth is it possible they can cover a 1.5B loss? Are they really sitting on that much profit, or is the goal to ponzi it out from here, MtGox style?

Yes, the profits are insane in that business. Binance was raided for a similar amount, and paid it out easily. Mtgox was raided for ₿650k ($60B in today's money), and plans to return ₿140k to traders. However, I believe most Mtgox investors are better off this way because they were forced to hold onto their investments; otherwise, they would have sold at around $1,000 or so.

This loss is more than 5% of their holdings.. To me that implies the supposed benefit of crypto is nonexistent. If an institution is making so much money off your crypto assets that they can return 5% of them, they are a bank doing whatever it was that was so evil.

Re: Bybit loses $1.5B in hack

#263

Post by jqpabc123 »

Saline9515 wrote: post #250
jqpabc123 wrote: post #211

Earlier quoted context omitted.

How on earth is it possible they can cover a 1.5B loss? Easy! They give Binance an IOU in exchange for 1.5 billion BUSD which is just "minted" out of fresh new electrons. Neither of them has really lost anything. Everyone can carry on as if it never happened. In the bizarro world of crypto, this is business as usual.

Binance doesn't mint BUSD, BUSD is emitted by Paxos, which is an american licensed company.

I have a license to drive a car. Having it doesn't limit my ability to mint crypto.

Re: Bybit loses $1.5B in hack

#264

Post by killerstorm »

jqpabc123 wrote: post #222
killerstorm wrote: post #214

Earlier quoted context omitted.

How it it different from what banks do? (Except for a central regulator.)

How it it different from what banks do? (Except for a central regulator.) Your exception is the answer. Only the central regulator can "mint" money and doing so has real world consequences. The central regulator has financial incentives to limit this sort of activity. The bizarro world of crypto has no such regulation and as a result, it is inherently unstable. The proof of this is right in front of you --- it is the…

False. Money on your bank account is backed by bank's assets, not by the central regulator. Recommended reading: https://en.wikipedia.org/wiki/Fractional-reserve_banking , M1 money supply, etc.

> The only way to bring stability to the bizarro world of crypto is by tying it to "fiat"

False. It's possible to make stable-coins using just price oracle and collateral. "Fiat" is not necessary. E.g. https://www.liquity.org/bold

Re: Bybit loses $1.5B in hack

#266

Post by FabHK »

simpsond wrote: post #204
stouset wrote: post #106

Earlier quoted context omitted.

In the face of the never-ending list of these kinds of events, the laughably impossible task of average nontechnical individuals protecting their own assets (and the consequence of total financial ruin when they fail to do so), the overwhelming number of and size of scams, rug pulls, fraud, outright Ponzi schemes, and on and on and on… what exactly is left to keep anyone a “huge believer”? Put differently, it’s been…

My faith would shake when scams, rugs, fraud, and ponzis completely stop outside of crypto.

The "oh but there's crime in fiat" argument holds no water.

Sure, HSBC facilitated money laundering and drug trafficking in Mexico. And when it came out, the fiat response was a huge outcry and putting a stop to it.

The crypto response is to say "screw the laws, let's go all in with money laundering and drug trafficking".

It's like noticing that kitchen knives are occasionally used for murder, and then concluding that it's a good idea to sell machine guns at every corner.

Fiat is indispensable, and (due to regulation) better for legitimate purposes than for crime.

Crypto is entirely dispensable, and (due to its inherent limitations (inefficient, slow, cumbersome)) better for crime than legitimate purposes.

Re: Bybit loses $1.5B in hack

#267

Post by m00dy »

Saline9515 wrote: post #250
jqpabc123 wrote: post #211

Earlier quoted context omitted.

How on earth is it possible they can cover a 1.5B loss? Easy! They give Binance an IOU in exchange for 1.5 billion BUSD which is just "minted" out of fresh new electrons. Neither of them has really lost anything. Everyone can carry on as if it never happened. In the bizarro world of crypto, this is business as usual.

Binance doesn't mint BUSD, BUSD is emitted by Paxos, which is an american licensed company.

Gary Gensler called BUSD a security and banned it years go. What a guy!

Re: Bybit loses $1.5B in hack

#268

Post by Saline9515 »

FabHK wrote: post #259
Saline9515 wrote: post #248

Earlier quoted context omitted.

Bybit is one of the most used crypto exchanges and does >100M$ of revenue per month, growing fast. If this isn't enough, I'm sure that every crypto VC would line up to buy a single digit % of their equity to cover up the hole. Crypto hosts the most profitable businesses in the world.

> Crypto hosts the most profitable businesses in the world. Well, because the retail clients expect to get rich and don't mind paying 1% or so fees per exchange. Similarly, the BTC future basis (the difference between the spot price and future price) on many exchanges around 10 to 5 years ago was easily 80% p.a. which you could realize by buying Bitcoin and selling the future. What happened there is that people going…

You pay 1% on Coinbase because they are a quasi monopoly due to regulation. Offshore exchanges take less than 0.1% usually.

The neutral rate for perps is 10%, which is lower than the credit card borrowing rate in the USA. And nothing prevents retail investors to earn it by shorting while holding spot.

Last, Tether is crypto's most profitable business, and likely the world's most profitable if you account on $ of profit per employee, and is not an exchange.

Re: Bybit loses $1.5B in hack

#269

Post by FabHK »

crazygringo wrote: post #261
FabHK wrote: post #252

Earlier quoted context omitted.

Credit card interchange fees being ridiculously high is pretty much a US thing: > In the United States, the fee averages approximately 2% of transaction value. In the EU, interchange fees are capped to 0.3% of the transaction for credit cards and to 0.2% for debit cards, while there is no cap for corporate cards. Sensible regulation can make a big difference. FWIW, I can pay bills by initiating a transfer both in HK…

It's also not even 2% in reality. It goes to rewards which go straight back to the consumer. My main credit card gives me 2% back on all purchases. In cash. Zero annual fee. And it's a card anyone with a normal credit score can get. Nothing special about it. It really only makes sense to compare interchange fees after subtracting the proportion of them that get paid back to consumers.

Sure, smart consumers can claw back some of that. But what you have then is merchants raising average prices, and consumers that use such credit cards being subsidized by those that don't.

Re: Bybit loses $1.5B in hack

#270

Post by bryant »

killerstorm wrote: post #264
jqpabc123 wrote: post #222

Earlier quoted context omitted.

How it it different from what banks do? (Except for a central regulator.) Your exception is the answer. Only the central regulator can "mint" money and doing so has real world consequences. The central regulator has financial incentives to limit this sort of activity. The bizarro world of crypto has no such regulation and as a result, it is inherently unstable. The proof of this is right in front of you --- it is the…

False. Money on your bank account is backed by bank's assets, not by the central regulator. Recommended reading: https://en.wikipedia.org/wiki/Fractional-reserve_banking , M1 money supply, etc. > The only way to bring stability to the bizarro world of crypto is by tying it to "fiat" False. It's possible to make stable-coins using just price oracle and collateral. "Fiat" is not necessary. E.g. https://www.liquity.org/…

> False. Money on your bank account is backed by bank's assets, not by the central regulator. Recommended reading: https://en.wikipedia.org/wiki/Fractional-reserve_banking , M1 money supply, etc.

You didn't even finish reading the first paragraph.

> Bank reserves are held as cash in the bank or as balances in the bank's account at the central bank

The collapse of svb shows how much the central regulator cares about making sure the entire banking system doesn't fall apart, too.

With the way you remarked "false" at the OP, though, I don't expect you're here for an engaging and educational discussion, so I'll leave it here. lol

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