The moment I learned that people want to buy crypto as a means to get rich in (evil ;)) fiat money, I knew I had a ponzi scheme in front of me. The interesting idea behind crypto once was to have a totally different system. Yet in reality, with greedy apes on a spacerock, it was an unreachable Utopia
> The interesting idea behind crypto once was to have a totally different system. the problem with this idea is that this idea of a "different" system is just merely going to evolve back into what we have today. The fundamental needs of a financial system doesn't change much, and what we have today is fit for purpose (mostly - there's efficiency to be had and red tape to cut).
Depends. In the USA, yes, your banking system is utterly shite, despite the supposedly numerous volume of different banks who are supposedly able to innovate and compete.
But.
that red tape is there to prevent a bank from collapsing. Its been imposed as a reaction to numerous financial crises.
There loads of rules that govern how much money a bank can loan, and how much they have to have on hand and in what classes they need to store deposits in.
A bank can be wildly profitable if it doesn't care too much who it lends to. Riskier debts yield much greater interest. The problem is, as soon as confidence takes a knock, the entire bank collapses because the value they claim they have is not backed by any kind of liquid asset.
This is the same with crypto. A stable coin is wildly profitable when people are pouring cash into it. but all it takes is a small wobble, people rushing to convert the "coin" into another asset class, and the whole thing crashes. This might be because they really don't have enough reserves to cover the withdrawl, or it was fraud. They aren't regulated, so we'll probably not know.