This brave world of unregulated opaque finance is just awesome, isn't it?
DeFi is much more transparent than traditional finance.
Trenchant comment, throwaway405769. It's true there are many more transparent frauds in the DeFi world.
The biggest crypto lending company is a ponzi scheme
361–370 of 429 posts
Re: The biggest crypto lending company is a ponzi scheme
#362Earlier quoted context omitted.
> “ By constraining it to transfer of an intermediate representation you're not making a good faith representation of the process.” Yeah, I’m betting on the future utility enabled by the tech, not what it can do right now. Similarly people said the web was useless in the 90s [0] when the future utility (imo) was obvious. > “Second, the only thing you can do better with crypto than a centralized exchange is crime, gri…
> Is this true? I thought there was a complex system of clearing houses, record updates, etc. a lot of which is done manually? Am I wrong? Blockchain is a database. Records at a bank are a database. There's no reason you can't just execute a SQL transaction to deduct from one and increment the other haha. That's not the slow part. That's why every one of the systems I mentioned supports real-time 24/7 transfers: SEPA…
I really try to resist being drawn into flame bait.
> "Remember the golden rule of blockchain: except in the case of regulatory arbitrage, grift and crime, if you think a blockchain is a better solution to a problem than any classical solution - you either don't know enough about crypto or you don't know enough about the problem."
There's a real possibility here that you're way overconfident and wrong and this overconfidence will blind you from a lot of interesting stuff that's going on.
> "There's no reason you can't just execute a SQL transaction to deduct from one and increment the other haha. That's not the slow part."
Yeah - that's because that's ignoring the entire context of everything else required around that. The centralized systems, the manual trust, the integration problems between organizations. The sql update is not the issue.
It seems clear from your tone that you're not really curious about this so I'll just leave it here.
> "Not a blockchain in sight. Amazing right?"
Good for you - let's check back in 10yr.
> "I seriously doubt you're betting against me haha."
¯\_(ツ)_/¯
Re: The biggest crypto lending company is a ponzi scheme
#363Earlier quoted context omitted.
> Anyway aren't social media networks like Facebook/Meta and Twitter valued higher as an increasing number of users join the network? Or new startups trying to get more users? Do you consider those ponzi schemes? Facebook/Meta and Twitter getting more MAUs means that they sell more ads. Zuck would still be rich if nobody was willing or able to buy FB at all. But if their only product was FB and TWTR stock, the only t…
> Question makes more sense flipped on his head: if you think everything that looks a little bit like a telecoms network in terms of having lots of participants obeys Metcalfe's law, then why aren't actual Ponzi schemes actually extremely valuable to participate in? Yeah, good point there. I think the thing with a Ponzi scheme, the way I see it, is that I can't transfer a share of that Ponzi scheme across the world,…
Shares in Ponzis are often easily transferable, as are penny stocks pumped by email spam and all the tokens and altcoins you mention that were created in obvious bad faith. Many of them have considerably fewer than 21 million in circulation too, and none of them claim to be worth as much as a Bitcoin. It doesn't make them good investments.
"If interest grows" is the big if and "price go up" is a very, very bad reason for interest in one particular coin to continue growing indefinitely when faced with all the alternative ways for people to park their money, from technically superior coins to investments they can actually live in (some available for less than a cryptographic string!) or stuff that pays actual dividends and gives you legal claim to actual real world assets. And for all the FUD cryptoenthusiasts like to spread about government money printing, it's the "fiat" world that has all the mechanisms that link money supply growth with market demand and real world activity, ability to shrink the money supply if its growing too fast, and the crypto world where basically the entire supply of coins has been printed in a few years by a small number of people trying to get rich and those coins will continue to exist for as long as the blockchain is maintained whether people want to buy them or not.
Re: The biggest crypto lending company is a ponzi scheme
#364Earlier quoted context omitted.
> Is this true? I thought there was a complex system of clearing houses, record updates, etc. a lot of which is done manually? Am I wrong? Blockchain is a database. Records at a bank are a database. There's no reason you can't just execute a SQL transaction to deduct from one and increment the other haha. That's not the slow part. That's why every one of the systems I mentioned supports real-time 24/7 transfers: SEPA…
I really try to resist being drawn into flame bait. > "Remember the golden rule of blockchain: except in the case of regulatory arbitrage, grift and crime, if you think a blockchain is a better solution to a problem than any classical solution - you either don't know enough about crypto or you don't know enough about the problem." There's a real possibility here that you're way overconfident and wrong and this overco…
> There's a real possibility here that you're way overconfident and wrong and this overconfidence will blind you from a lot of interesting stuff that's going on.
I'm always open to that possibility, and I spend a lot of time learning about blockchain technology. And I've spent the last 10 years working in fintech. Of the commenters here, I probably have more context than most on both.
> Yeah - that's because that's ignoring the entire context of everything else required around that. The centralized systems, the manual trust, the integration problems between organizations. The sql update is not the issue.
Correct, centralization and trust represent massive efficiencies.
Banks trust each other or can trust a central intermediary which is again why NPP, RTP, FedNow, SEPA, FPA all work instantly, basically free, without blockchain. Whereas moving USDC-ETH between two accounts costs $25.
> Good for you - let's check back in 10yr.
It's been 14 years and yet we have nothing to show for it except a whole pile of used up Kazakh and Xinjiang coal - and some really ugly twitter avatars. But yes, I'll wait, I'm sure OP will deliver by 2031.
Re: The biggest crypto lending company is a ponzi scheme
#365Earlier quoted context omitted.
So instead of actually debunking his arguments you published a handwavy reply? I very much think that if someone is offering insanely high ROIs but does not divulge how the value is created, you can safely assume it's a scam, and simply pointing out the disparity suffices as proof to me at least.
So, definitely not in defense of Celsius it smells funny to me as well. But the author doesn't seem to understand DeFi. I don't know how Celsius operates but if there's a genuine zero-knowledge proof of their operations then that is better than an actual audit. The author doesn't understand this and proceeds as if no audit actually happened. If the author instead spent some time researching the contents and the merit…
> I don't know how Celsius operates but if there's a genuine zero-knowledge proof of their operations then that is better than an actual audit.
Someone might be able to demonstrate to you that they have a $20k bank balance.
Audits are where you try to do a reasonable job of making sure they aren't also hiding the fact that they've got $50k in credit card debt lying around.
Re: The biggest crypto lending company is a ponzi scheme
#366Earlier quoted context omitted.
Not gonna lie, I can tell the difference...
Go for a higher quality replica? https://www.marcalexanderart.com/reproductions/ "own a museum quality reproduction of a great master’s painting that is indistinguishable from the original"
Not gonna lie, I think an inauthentic art reproduction is going to set me back more than an minting an inauthentic claim to own a gif on a blockchain.
It'll look better on my wall though, which is why I'd consider commissioning it.
For related reasons, I suspect that whilst more people would flock to see the actual Sistine Chapel ceiling than one I commissioned for my living room, I'd still have an easier time wowing people with the living room artwork than a NFT with a gif, even if it was countersigned by the Vatican
It's almost like the important bit of the provenance for appreciation is in having the actual physical original the actual artist worked on, not a certificate saying you sent some money to someone on an aftermarket and exactly the same gif everybody else has
Re: The biggest crypto lending company is a ponzi scheme
#367Earlier quoted context omitted.
>like by staking ETH What's the ROI on staking ETH right now? Is it anywhere near the rate that they claim? >selling covered calls you're taking on risk when doing that. It works well until you get assigned, in which case you take a massive loss and unable to pay back your investors.
How do you take a “massive loss” on covered calls being exercised? They have defined risk, you give up some potential upside to collect premium. If they are exercised, the underlying is called away. Selling naked calls has a lot more risk, see the blowup of optionsellers.com on naked natural gas options
>How do you take a “massive loss” on covered calls being exercised?
The loss comes from the opportunity cost of what you could have sold the underlying asset for. That might or might not be "massive", but the potential is definitely there. At the end of the day you're picking up pennies in front of a steamroller. Maybe it even has expected value greater or equal to the advertised APY, but failing to disclose that and/or pretending like it's guaranteed is deceptive. I'd be pissed if I put my money into some sort of "savings account" with 8% APY, then get wiped out next time there's a spike/dip, because it turned out that they were using it to write covered calls.
Re: The biggest crypto lending company is a ponzi scheme
#368Earlier quoted context omitted.
I really try to resist being drawn into flame bait. > "Remember the golden rule of blockchain: except in the case of regulatory arbitrage, grift and crime, if you think a blockchain is a better solution to a problem than any classical solution - you either don't know enough about crypto or you don't know enough about the problem." There's a real possibility here that you're way overconfident and wrong and this overco…
> There's a real possibility here that you're way overconfident and wrong and this overconfidence will blind you from a lot of interesting stuff that's going on. I'm always open to that possibility, and I spend a lot of time learning about blockchain technology. And I've spent the last 10 years working in fintech. Of the commenters here, I probably have more context than most on both. > Yeah - that's because that's i…
The bitcoin whitepaper came out in 2009, Ethereum was 2015, a lot of the interesting stuff has been within the last two years.
You may be right in the end, but people with exposure to the industry at risk of disruption are often bad at recognizing it. See Ballmer at Microsoft mocking the iPhone, Blockbuster failing to adapt to Netflix, Borders failing to adapt to Kindle/Amazon etc.
That knowledge can provide context for accuracy, but it can also mislead or bias you against something that's changing rapidly.
> "Correct, centralization and trust represent massive efficiencies."
At a real cost. The web comparison would be decentralized underlying protocols vs. the centralized applications on top of them. "Web3" may allow a way to fix the things that lead to centralization at the application layer with UX that actually works. This is distinct from cryptocurrency, but there's some overlap. ETH cost should get reduced by ETH2 and sharding, the cost is representative of current transaction demand.
I'm not a crypto-anarchist, I think both systems will have complementary purposes. Programmable money is something new, knee-jerk dismissals of "it's all crime" are dumb imo.
Re: The biggest crypto lending company is a ponzi scheme
#369Earlier quoted context omitted.
Crypto is not just Bitcoin, and crypto is not just Proof-Of-Work. Other blockchains who can be just as decentralized and censorship-resistant exist. (In the spirit of DRY, I think it is time we collectively write all an adversarial collaboration about crypto on some wiki page. Then I can at least just respond with a link to the rebuttal of the same tired and lazy arguments that crypto-skeptics make)
> Crypto is not just Bitcoin, and crypto is not just Proof-Of-Work. Sure. Theoretically. Are you suggesting "crypto" isn't almost entirely proof-of-work - de facto? You think those invested care for proof-of-stake? Lol. > same tired and lazy arguments that crypto-skeptics make HyDrOpOweR!1! (Deprecated in 2021) But hey, I am all for the wiki. Actually, I wonder why that hasn't happened yet... Anyway, I don't want to…
> You think those invested care for proof-of-stake?
Enough to stake more than 8 Million ETH (about ~35 Billion dollars) [0]
> because it utterly sucks for transactions.
Again taking Bitcoin as a whole of crypto?
Yes, Bitcoin has failed as a currency. Yes, the "digital gold" narrative is bogus. Yes, there will be a lot of Bitcoin maxis who will have to deal with the terrible realization that their "sound money" is worthless. Can we move on now?
[0]: https://etherscan.io/address/0x00000000219ab540356cbb839cbe0...
Re: The biggest crypto lending company is a ponzi scheme
#370Earlier quoted context omitted.
Crypto is not just Bitcoin, and crypto is not just Proof-Of-Work. Other blockchains who can be just as decentralized and censorship-resistant exist. (In the spirit of DRY, I think it is time we collectively write all an adversarial collaboration about crypto on some wiki page. Then I can at least just respond with a link to the rebuttal of the same tired and lazy arguments that crypto-skeptics make)
This is wrong, all PoS cryptocurrencies are extremely centralized. Try running a validator on Avalanche, see how it goes.
The merge is all but inevitable now, and it seems that there are quite a good number of validators for the Beacon chain: https://etherscan.io/address/0x00000000219ab540356cbb839cbe0...