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Crypto in 2026: Oh, This Is the Bad Place

stephendiehl.com

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Re: Crypto in 2026: Oh, This Is the Bad Place

#221

Post by viscountchocula »

colechristensen wrote: post #203
alehrs wrote: post #50

I've been deep into crypto for years and I was a big stablecoin supporter. I was fascinated by the tech and I still am. But everything outside the tech itself is just trash, scams, and gambling. I've come to believe that "pure" decentralization is neither practical nor particularly convenient. The only real use case that makes sense to me is giving people in developing countries access to a stable currency they can a…

>The only real use case that makes sense to me... Cryptocurrencies have a great and really boring application. You have to think "who needs a reliable ledger distributed among many entities?" The answer is institutional banks the likes of JPMorgan. They have a few cryptocurrencies, you need to be another large bank to use them. Big banks send each other large sums of money constantly back and forth. In no sense do th…

But a regular database can do that with PKI. Crypto isn't just a reliable ledger -- it's a reliable ledger between an arbitrary number of mutually distrusting parties. Which doesn't really describe banks in a regulated, functioning economy.

Re: Crypto in 2026: Oh, This Is the Bad Place

#222

Post by Retric »

coldtea wrote: post #9
thrownawaysz wrote: post #2

>Meet Mike. Mike is a college freshman who is exposed to crypto through social media. He downloads Coinbase, buys ten dollars of CumRocket because his friend group is in on it, watches the price move, and feels for the first time the dopamine rush of gambling on non-economic random walks. By his sophomore year he is onto harder drugs: 0DTE options on triple-leveraged single-stock ETFs he does not understand, traded o…

> tbh that reads a bit like the war on drugs propaganda we got in school back then. Well, propaganda or not, hard drugs are bad for you.

So is bleach, that doesn’t inherently justify anything past a warning label.

Re: Crypto in 2026: Oh, This Is the Bad Place

#223

Post by chasd00 »

thrownawaysz wrote: post #2

>Meet Mike. Mike is a college freshman who is exposed to crypto through social media. He downloads Coinbase, buys ten dollars of CumRocket because his friend group is in on it, watches the price move, and feels for the first time the dopamine rush of gambling on non-economic random walks. By his sophomore year he is onto harder drugs: 0DTE options on triple-leveraged single-stock ETFs he does not understand, traded o…

> and he is meaningfully poorer at every stop along the way.

or meaningfully richer as the case may be

Re: Crypto in 2026: Oh, This Is the Bad Place

#224

Post by energy123 »

this_user wrote: post #107
himata4113 wrote: post #45

Cryptocurrency is very much a double edged sword, on one hand it enables people to transact monetary value bypassing for-profit operators such as western union and paypal as well as hinders corrupt government institutions from confiscating or otherwise devaluing what you own. Of course this also allows people with harmful intentions to do the same, bypass centralized systems that keep fraud in check, mitigate theft a…

> it enables people to transact monetary value bypassing for-profit operators such as western union and paypal You are not even getting rid of that, you are just replacing them with a different set of middlemen in the crypto ecosystem who are demanding substantially higher fees than, say, a Wise does.

Wise demands a massive fee through bid-offer spread, they're more expensive than many regular retail banks for FX conversion. They're basically running a deceptive advertising campaign due to customers not knowing about bid offer spread.

Wise is even worse than "zero-fee" stock trading platforms like Robin hood who do payment for order flow. At least PFOF is more competitive and regulated and you're only getting a few basis points stolen from you instead of like 80 basis points.

Re: Crypto in 2026: Oh, This Is the Bad Place

#225

Post by tootie »

over_bridge wrote: post #146
danielvaughn wrote: post #117

Earlier quoted context omitted.

I got into crypto in 2017 when I came across the phrase "money is a technology". That idea fascinated me. But fast forward several years later, and it's obvious that money might be a technology in the sense that it's a tool, but more importantly, money is a culture .

Or if you read Sapiens you'll know money is a story we tell each other. You can't literally do much with a coin or bank note or numbers on a screen but as long as we all believe it has value, it does. It becomes part of the culture, as you say. Crypto also has to tell a story about why it's valuable. There was a lot of anti government rhetoric and fear mongering (from libertarians) but the public never really believe…

Honestly as much as people complain the US Federal Reserve really just proved their enormous value and thoroughly vindicated fiat currency. The financial crisis of 2007-8 should have been a new Depression and it wasn't. Instead we've seen uninterrupted growth for close to 20 years. Markets have really internalized that the US economy is indestructible and the Fed will always protect us from disaster. Will it last forever? Of course not. But like Keynes said, "in the long run, we're all dead".

Re: Crypto in 2026: Oh, This Is the Bad Place

#226

Post by neonstatic »

api wrote: post #168
neonstatic wrote: post #128

Earlier quoted context omitted.

I think the point that is missed is all of these solved real problems that needed solving. I feel over the last decade we have exhausted the obvious benefits of the Internet revolution and more often than not we were seeing clever technology being developed, that wouldn't solve any problems. Then long and painful search for applications of that technology would ensue. Cases in point: crypto, llms.

You’re comparing crypto and LLMs?

Yes. In fact, crypto is ahead, because it does have a legitimate use case. Two, actually - money laundering and sanctions evasion.

Re: Crypto in 2026: Oh, This Is the Bad Place

#227

Post by ianm218 »

graemep wrote: post #206
alehrs wrote: post #50

I've been deep into crypto for years and I was a big stablecoin supporter. I was fascinated by the tech and I still am. But everything outside the tech itself is just trash, scams, and gambling. I've come to believe that "pure" decentralization is neither practical nor particularly convenient. The only real use case that makes sense to me is giving people in developing countries access to a stable currency they can a…

When people in a developing country cannot hold foreign currency it is a result of a deliberate decision by their government. That creates a number of issues. They may well be breaking the law holding stable coins. It means practical difficulties in buying stable coins (they need someone who will sell stablecoins in their currency).

> (they need someone who will sell stablecoins in their currency).

It's pretty hard to really lock people out of stable coins really. You really just need someone to sell you some type of cryptocurrency that can be eventually exchanged for stablecoins. You can even do "peer to peer" trades if the government really cracks down on holding crypto.

I agree with the sentiment of this article but atleast some parts of the world with poor currencies like Latam have seen some benefit from stbales.

Re: Crypto in 2026: Oh, This Is the Bad Place

#228

Post by colechristensen »

viscountchocula wrote: post #221
colechristensen wrote: post #203

Earlier quoted context omitted.

>The only real use case that makes sense to me... Cryptocurrencies have a great and really boring application. You have to think "who needs a reliable ledger distributed among many entities?" The answer is institutional banks the likes of JPMorgan. They have a few cryptocurrencies, you need to be another large bank to use them. Big banks send each other large sums of money constantly back and forth. In no sense do th…

But a regular database can do that with PKI. Crypto isn't just a reliable ledger -- it's a reliable ledger between an arbitrary number of mutually distrusting parties. Which doesn't really describe banks in a regulated, functioning economy.

No, a regular database can't do that "with PKI", you have to write ledger software on top of it and you have to have one party operating the software.

cryptocurrencies are the ledger software, API, and data store layer -- and you do need trust between peers because the JPMorgan will take actions to reverse transactions if there are problems that need fixing.

It's not magical, but it is convenient for the actual ledger actions to be mathematically proven instead of the result of accounting rules in code.

Re: Crypto in 2026: Oh, This Is the Bad Place

#229

Post by tootie »

himata4113 wrote: post #45

Cryptocurrency is very much a double edged sword, on one hand it enables people to transact monetary value bypassing for-profit operators such as western union and paypal as well as hinders corrupt government institutions from confiscating or otherwise devaluing what you own. Of course this also allows people with harmful intentions to do the same, bypass centralized systems that keep fraud in check, mitigate theft a…

Crypto has utterly failed as a currency. In that regard it's been dead for over a decade. If btc or eth were currency they'd be considered dead by deflationary spiral which is more or less what every economist predicted from the start. Some people got rich by investing but getting rich off of currency speculation is generally awful for people who rely on that currency to live. Crypto has been a success the same way The Room was a successful movie.

Re: Crypto in 2026: Oh, This Is the Bad Place

#230

Post by zeafoamrun »

jameshart wrote: post #188
zeafoamrun wrote: post #91

> "A platform that the federal regulatory apparatus has agreed to treat as adjacent to a derivatives market listed, ran, settled, and paid out a binary contract on the eschatological return of the Christian messiah." How is this not the coolest shit ever?

You might be surprised what legitimate insurance companies have issued policies against in the past - it has always been the case that insurance and gambling are more closely adjacent than you might think. For example: https://www.insurancebusinessmag.com/ca/news/breaking-news/d... “One British insurance company came to the rescue of three Scottish sisters … concerned about the cost of raising the Son of God should o…

Right, you can use the same instruments for both speculating and hedging. Who is to say nobody was using this as a hedging instrument?
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