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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

#311

Post by inigyou »

bigfishrunning wrote: post #275
__MatrixMan__ wrote: post #269

Earlier quoted context omitted.

Crypto was initially interesting to me because scarcity based economics is failing us and crypto give us a way to explore alternatives. But so far, nearly everything we've built with it has just been a clone of some scarcity-based thing that already exists outside of crypto. Since then I've come to the conclusion that it's never worthwhile to buy crypto with fiat. Any scheme which asks that of its users creates too m…

Isn't the whole point of an economy a method of resolving scarcity? Money is a proxy for participation; it keeps me from having to agree to paint the miller's fence in exchange for some flour.

Used to be, but now it's agree to paint Musk's fence in exchange for nothing, or else you aren't even allowed to exist, because the system has been thoroughly gamed. Usually when a metric becomes too gamed it's imperative that we stop using it as a metric (Goodhart's law) or else very bad things happen.

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

#312

Post by dghlsakjg »

jakelazaroff wrote: post #157
dghlsakjg wrote: post #134

Earlier quoted context omitted.

I can’t think of many better examples of social problems than sanitation and public health.

In that case, what are examples of non -social problems you can think of?

A broken TV.

If my neighbour has a "removing raw sewage from living spaces" problem, it is very much a concern for me.

If my neighbour can't watch TV, I don't care.

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

#313

Post by notpushkin »

raincole wrote: post #124
this_user wrote: post #107

Earlier quoted context omitted.

> 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.

It's a very weird comment as people who actually use crypto (not flipping or holding) are those who without other viable choices. They're not replacing something. Those transactions would simply not happen without crypto. Notice that the parent comment didn't use the word replacing .

This. Wise is good as long as you can open an account there. For many people this is not a viable option.

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

#314

Post by inigyou »

nradov wrote: post #250
over_bridge wrote: post #146

Earlier quoted context omitted.

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…

Fiat currency isn't just a matter of belief or stories. If you interact with the US financial system in any significant way then you're likely to end up owing some income taxes, and those can only be paid in US dollars. If you don't pay then eventually law enforcement officers will seize your assets (real estate, cattle, gold, cryptocurrency, whatever) by force and auction them off to settle your tax debt. And if you…

So what you're saying is that you can pay your taxes in dollars, real estate, cattle, gold, cryptocurrency or whatever.

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

#315

Post by notpushkin »

energy123 wrote: post #224
this_user wrote: post #107

Earlier quoted context omitted.

> 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 fe…

Wise fees are sometimes big, but I find them fairly transparent about it.

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

#316

Post by inigyou »

tootie wrote: post #225
over_bridge wrote: post #146

Earlier quoted context omitted.

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 for…

The fundamental structural problems from 2007-8 are still here. The system has been running with paper over the cracks in the foundation for almost 20 years.

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

#317

Post by inigyou »

atomic_cowprod wrote: post #274
glitchc wrote: post #264

Earlier quoted context omitted.

The key difference is that they all require identity to use and can be traced back to a person.

That is by design and is a good thing to everyone except cartels and communist governments.

What about people wanting to buy abortion pills?

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

#318

Post by tome »

singpolyma3 wrote: post #192
altmanaltman wrote: post #98

Earlier quoted context omitted.

Yeah like why is Mike thinking he is investing if he is betting on a literal sportsbook? That is delusion and has nothing to do with crypto. I am not pro crypto but the logic here doesn't make a lot of sense. You can say buying crypto is like gambling sure but it literally is not. It's investing in an extremely risky asset that can go to 0. But it is very different than placing a bit on Kalshi or a sportsbook. I actu…

Honestly I blame the stock market goons for normalizing calling "betting on the stock market" investing. The stock market isn't investing it's gambling. Same for the bond market and most asset markets. Buying a bond from the issuer is investing. Buying an IPO is investing. Buying a rental property is investing. Investment implies possible productive result from the action. When you buy shares or bonds already on the…

Thought experiment: suppose company C does a small IPO. I'm rich and buy all their offering.

Scenario 1: I hold all the stock for decades until I die. Under your terminology, I am the sole "investor". Fine.

Scenario 2: 1 millisecond after my purchase I sell everything I bought in the IPO to thousands of market participants. Under your terminology they are not "investors". I can't be an investor either, since I hold no more of the stock. Does the company no longer have investors?

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

#319

Post by falsemyrmidon »

akoboldfrying wrote: post #155

> A defender will say that gold is no different, a price that refers only to itself, and that we do not call gold a fraud; but gold carries a floor of industrial demand and a monetary role thousands of years old, and Bitcoin has neither. I'm always interested to see how anti-crypto people try to differentiate gold from crypto, and so far I've never seen anything convincing. Gold's industrial utility as a good electri…

Gold is shiny and can make nice jewelry and other things shiny.

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

#320

Post by datadrivenangel »

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).

Right! It's not that stable coins are decentralized, it's that the centralized holder is not in your jurisdiction and so your jurisdiction can't deface their money!
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