Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

You Can Forget About Crypto Now

theatlantic.com

Post reply on HN
Print view View original

231–238 of 238 posts

Re: You Can Forget About Crypto Now

#231

Post by lottin »

super256 wrote: post #218
lottin wrote: post #197

Earlier quoted context omitted.

Every dollar that you have is not somebody else's debt. You're completely misinterpreting what a dollar is.

No, you're wrong. The whole money supply is controlled by the Federal Reserve through purchasing and selling securities. When the FED purchases a security, the money gets deposited in the reserves of commercial banks, which then increases the money in circulation through making loans to consumers and businesses. And the mentioned securities are, uhhh, treasuries! To break it down: If I have 1 dollar in my account, th…

You have 1 dollar in your account, and the bank owes you 1 dollar. So you have 2 dollars?

Re: You Can Forget About Crypto Now

#232

Post by legutierr »

Nursie wrote: post #225
legutierr wrote: post #211

Earlier quoted context omitted.

> Not using their custody doesn’t fully protect you from their actions. Sure, but this is market risk, not counter-party risk, and is unmitigated in traditional markets as well. Just look at how Apple stock was affected by Lehman Brothers’ failure. > Cryptocurrency does not settle instantaneously, in fact credit cards are usually faster. Come again? If you pay me for goods using crypto, I can spend that money immedia…

> market risk Yep, but with cryptocurrency the entire market is a shitshow. Unless you can somehow prevent these folks from playing their games, you haven’t improved upon the situation you complain about. > Can a merchant spend its customers’ money immediately after running the credit card? No. I see you’ve never used Square, the answer is “Yes” > Particular cases There was the near-collapse of Solend, and shenanigan…

Thanks for sharing these cases. And you are right to point out that they represent a real problem in DeFi currently, which is that some protocols are poorly designed.

These examples are best categorized as hacks, though, which are important to distinguish from losses incurred due to bad debt.

The distinction is important because the question at stake is whether DeFi in general has value. If you look at more mainstream protocols like Aave, you don’t see these same problems. In the mid- to long-term, after the technology has stabilized, all the benefits of DeFi will accrue to users without the risks that you are pointing out.

With regards to Square: yes, you can get your money wired to you at the end of the day—if you are willing to pay an extra 1.5% fee.

This is more akin to very expensive financing—having an annualized interest rate in excess of 300%!—than “instantaneous settlement”. It’s also not standard. Square’s standard settlement process is as I described:

https://squareup.com/help/us/en/article/5438-next-business-d...

Re: You Can Forget About Crypto Now

#233

Post by msrenee »

haasted wrote: post #117
msrenee wrote: post #77

Earlier quoted context omitted.

Weren't those three all sued out of existence due to copyright infringement? That's very much a different reason for failure than what's going on in crypto.

Regulation is likely to have a similar impact in crypto.

I can't agree with that. Napster, Kazaa, and Limewire were determined to have been breaching copyright law and the business model was determined to be illegal. There's no parallel here.

Re: You Can Forget About Crypto Now

#234

Post by papito »

walnutclosefarm wrote: post #154

The degree to which crypto exchanges mimic wildcat banks of the nineteenth century is striking. They are basically unregulated "banks" issuing and manipulating proprietary currencies against real, central-bank regulated, national currencies. The biggest difference is that people used wildcat currencies due to scarcity of national currencies, and regulated banking institutions, whereas they participate in crypto excha…

This is not a new observation. The crypto market is basically the pre Great Depression banking sector. That's why this libertarian talk of "freedom" and "decentralization" is really just longing for chaos. Respek the fiat.

Re: You Can Forget About Crypto Now

#235

Post by coatmatter »

super256 wrote: post #58
slaw wrote: post #3

> despite the ricketiness of the whole system, despite the constant feeling that everything might fall apart at any moment, there will come a time when crypto really arrives. For me crypto was always Ponzi scheme and nothing more, but it is because I don't laundry money or sell drugs, so I am not the target for crypto.

> For me crypto was always Ponzi scheme and nothing more, but it is because I don't laundry money or sell drugs, so I am not the target for crypto. I find Bitcoin very intriguing because unlike TradFi it is not built in debt. Every dollar you have in your account is someone else's debt to you. Which is also the reason Bitcoin gets compared so much to gold! There is a fixed amount of nuggets and no debt is involved. (…

Gold at least is shiny, dense and virtually indestructible, and we humans naturally value things that draw our attention like that. Gold has also stood the test of time as something that most people appreciate when they see/touch it. It'll always be possible in any country to trade an ounce of gold (in any physical form) for /something/ well above $0. Can this guarantee be as easy to make with Bitcoin or any cryptocurrency of one's choosing?

For most normal (non-techy) people, what's the allure of Bitcoin once you remove all the marketing? Perhaps gold indeed still relies on the greater fool, but that fool on average is still less of a fool than the greater fool who has too much "invested" in cryptocurrency.

Re: You Can Forget About Crypto Now

#236

Post by super256 »

lottin wrote: post #231
super256 wrote: post #218

Earlier quoted context omitted.

No, you're wrong. The whole money supply is controlled by the Federal Reserve through purchasing and selling securities. When the FED purchases a security, the money gets deposited in the reserves of commercial banks, which then increases the money in circulation through making loans to consumers and businesses. And the mentioned securities are, uhhh, treasuries! To break it down: If I have 1 dollar in my account, th…

You have 1 dollar in your account, and the bank owes you 1 dollar. So you have 2 dollars?

I am certain that you're trolling, but I'm giving you the answer anyway: No.

When you have 1 dollar in your account, the bank still has the dollar! It's a liability owed to you.

Every financial asset is somebody else's liability. Every financial asset is similar to a promissory note. If you sign one, it is your liability, but it would be an asset for the note's holder. This is also true for your bank account. Your account statement is a promissory note that the bank owes you 1 dollar.

Re: You Can Forget About Crypto Now

#237

Post by Ebree »

sek wrote: post #62

If it is a medium of exchange, all the attention never made a lot of sense. The use cases are niche; that's the thing. Venezuelans who avoid inflation and ordering illegal drugs are not a trillion-dollar business. All the legal/regulated areas mean competing with existing financial infrastructure, which is low margin and incredibly competitive. So if you see the space as a whole, it never had the potential market to…

Wait for a global ban on cash. Suddenly the only thing that will left for your finance to stay private will be crypto but some truly private (not like majority privacy coins) & decentralised one or something like this on top of Bitcoin. Everything is a bubble until it outlasts critics. People hiding their wealth before marriage are a bigger market than drugs or hedging inflation.

If BTC would be extended with only one feature - transfering users funds not touched for a year to an auto lottery pool distributing funds to Bitcoin transaction makers randomly, BTC would become the biggest casino on earth.

BTC & crypto competes with these institutions. Why do you have cheaper international transfers now? Legacy fin infrastructure is a joke. That's why cryto took off so easily.

Soon you may have a fully digital dollar/eurodollar which itself already is a global & free to use digital ledger, just with centralised issuance and link to oil & US securities.

Re: You Can Forget About Crypto Now

#238

Post by ineedasername »

Melting_Harps wrote: post #228
ineedasername wrote: post #222

Earlier quoted context omitted.

You describe the current entrenched system with such horror which… well, a bit one sided but not complete wrong either. The only problem is that it’s displacement by a market resembling the crypto one currently in collapse would be worse in every single way. Just take investment portfolio loss that you mention: a tech heavy portfolio that lost 60% this year, if the investor is long anyway, may recover a bit or comple…

> You describe the current entrenched system with such horror which… well, a bit one sided but not complete wrong either. Because one should, how we went from the 90s Cypherpunk culture taking over SV to this is abysmal situation is stark and it can be attributed to this vile outlook on 'the other' who in their view didn't work hard enough to get to the right university, learn o code and get the right degree to paper…

Thank you for an extremely thoughtful reply! I’ll be honest, I don’t have the time or attention span to go back and forth again but I also don’t think that’s necessary. You’ve given me some good things and valid reasoning to think about, and I will! So, a good discussion and exchange of ideas. Thanks!
Post reply on HN