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Crypto exchange AAX suspends withdrawals

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Re: Crypto exchange AAX suspends withdrawals

#471

Post by IndrekR »

brnt wrote: post #33

So, having been around since the early bitcoin days, core to the salespitch back then was the fact you would have control. You'd have your coins in your wallet, and no need for banks etc. Apparently nobody does this anymore, and gives their wallets to these exchanges (i.e. banks) and balks when the obvious happens in pyramid schemes. People just don't get distributed currency if they promptly undistribute it. Or is i…

> People just don't get distributed currency if they promptly undistribute it.

Same as with source code version control. As soon as distributed VCS appears (git), people promptly centralize it with another abstraction layer (github, gitlab, bitbucket, etc).

Re: Crypto exchange AAX suspends withdrawals

#472

Post by Animats »

kkielhofner wrote: post #106
brnt wrote: post #33

So, having been around since the early bitcoin days, core to the salespitch back then was the fact you would have control. You'd have your coins in your wallet, and no need for banks etc. Apparently nobody does this anymore, and gives their wallets to these exchanges (i.e. banks) and balks when the obvious happens in pyramid schemes. People just don't get distributed currency if they promptly undistribute it. Or is i…

As I've noted before on HN the entire concept of people being able to manage their own wallets flies against everything we know about people. People forget stuff, make mistakes, and lose things. The margin of error for a wallet is tiny. It's not rare for crypto forums, twitter, etc to prescribe completely ridiculous processes and systems for securing wallets, backing up seed phrases, etc. There's an entire cottage in…

There's a market here for a safe way to store crypto. Something like a thing you carry with you, a thing you can keep at home, a thing you have a friend hold, a thing you have in a safety deposit box, and info a service holds for you. Some combination of majority votes, time delays in days or weeks, and warning messages lets you recover from loss and damage. With backup from an insurance company. But nobody has addressed that market.

Re: Crypto exchange AAX suspends withdrawals

#473

Post by narcraft »

Karzyn wrote: post #434
bussierem wrote: post #377

Earlier quoted context omitted.

I know this type of comment (and my own) is more common to reddit and commonly frowned upon in HN threads, but by god this made my morning thank you.

FYI, that's what the little arrow next to their name is for.

I like this informative reply

Re: Crypto exchange AAX suspends withdrawals

#474

Post by matai_kolila »

JackFr wrote: post #462
sydd wrote: post #415

Earlier quoted context omitted.

Heh I would not call them paranoid after all these crypto collapses. Say I'd have $100000 in a crypto wallet, I'd etch it too and keep it in a safe instead of giving it to a website with no state backed guarantees.

The funny part of that is that you literally cannot have $1000000 in a crypto wallet, because that's not how dollars work. Oh, you've got something in your crypto wallet, but it ain't dollars.

Of course he can have $100,000 in his wallet, that $80k will be usable to exchange in return for $50k of goods, for sure!

Re: Crypto exchange AAX suspends withdrawals

#475

Post by obnauticus »

logicalmonster wrote: post #460

Every new form of money and trade had the people learning important financial concepts and took many, many years to start to iron out their weaknesses through better technology or best practices. For instance, when barter and basic trade was used, people had to figure out new methods to do accounting and record-keeping: whether through sticks, tablets, papyrus, etc. It seems simple now, but these basic methods were i…

Small nit, there is no evidence that barter and trade economies ever existed.

When there is a utility for it, humans invent a form of currency nearly immediately.

Re: Crypto exchange AAX suspends withdrawals

#476

Post by LawTalkingGuy »

bmmayer1 wrote: post #219
adammarples wrote: post #148

"Industry" People gave us money and now they want it back but we spent it

This. If an exchange cannot 1:1 fund withdrawals it is not an exchange, it's a ponzi scheme. Full stop. All real exchanges should be releasing evidence of 1:1 backed customer deposits ASAP like Coinbase has. And if they don't, it should be considered a canary of systemic risk.

Until recently all crypto exchanges had to be scams. They can only profit by selling/loaning customer funds or by trading with a dishonest advantage by being the house. If an exchange was profitable, and they all were, it was because it was a scam.

This is the same analysis that shows that Tether is a fraud. If they took a dollar for every dollar token sold and then paid to store those dollars as collateral they'd be losing money, and would have no profit because they sell $1 for $1. They are wildly profitable though which proves that it's from crime because their base model has zero profit.

Recently though, the last few years, you can loan crypto for zero time and with zero risk in a process called a flash loan. You structure a single transaction to borrow funds, spend those funds and profit, and return those funds with interest. This actually allows an exchange to use user funds without risking them.

Hopefully we're done with centralized exchanges though, because even if they can be made possible they can never actually be made safe for the users.

Re: Crypto exchange AAX suspends withdrawals

#477

Post by hristov »

brnt wrote: post #33

So, having been around since the early bitcoin days, core to the salespitch back then was the fact you would have control. You'd have your coins in your wallet, and no need for banks etc. Apparently nobody does this anymore, and gives their wallets to these exchanges (i.e. banks) and balks when the obvious happens in pyramid schemes. People just don't get distributed currency if they promptly undistribute it. Or is i…

The crypto community is very much to blame for this. Initially, back when bitcoin was hovering about $1 per coin, everyone was talking about personal wallets, and educating people how the wallet was just a bunch of numbers you can write on a piece of paper and which you can keep hidden in the lining of your pants, etc.

But then bitcoin started getting popular and emerging towards mainstream culture, the talk about wallets seized. All the new crypto firms started marketing accounts and "cloud wallets" and the personal pocket wallet was never mentioned.

Crypto then continued to advance in mainstream culture and personal wallets were kept a secret. I doubt the average crypto user even knows about personal wallets.

And if you disagree, please prove me wrong. There are many crypto commercials on mainstream media, show me one that has mentioned that you can keep a personal wallet.

So the crypto industry is to blame for this. They basically hid the most important part of crypto from the public because they would make more money without it.

Re: Crypto exchange AAX suspends withdrawals

#478

Post by smcl »

pjc50 wrote: post #184
smcl wrote: post #158

Earlier quoted context omitted.

Re point #2 - this is one of the crazy things for me. When you work in finance, in the UK at least, you get it drilled into your head what "client money" is, what that implies, what you can do with it, and notably you get reminded during any training session the size of the fines that get imposed on people who fuck with client money. So to me it suggests that they simply don't employ anyone with any experience in ban…

Well, yes, it was a startup by a bunch of twentysomethings with no real banking experience. There was no partitioning. > the size of the fines that get imposed on people who fuck with client money. This is crypto, law doesn't apply here. Well, that's the marketing pitch at least. So far a lot of exchanges and such like have gone bankrupt or been blatently stolen by their operators and nowhere near enough people have…

I should say that what surprised me wasn't that a bunch of kids started up a company and during that process skirted, if not regulations, at least common sense. But that once serious money got involved and they grew into the millions and then billions of assets under management, nobody was around who could tell them that this was reckless and dangerous

Re: Crypto exchange AAX suspends withdrawals

#479

Post by [deleted] »

brnt wrote: post #33

So, having been around since the early bitcoin days, core to the salespitch back then was the fact you would have control. You'd have your coins in your wallet, and no need for banks etc. Apparently nobody does this anymore, and gives their wallets to these exchanges (i.e. banks) and balks when the obvious happens in pyramid schemes. People just don't get distributed currency if they promptly undistribute it. Or is i…

[deleted]

Re: Crypto exchange AAX suspends withdrawals

#480

Post by wedn3sday »

zen21 wrote: post #423
smileybarry wrote: post #221

Earlier quoted context omitted.

> There's an entire cottage industry built around people etching their seed phrases on steel plates for people to (I'm not kidding) bury them like they're gold in the 1800s. I was stunned to see so many of these products on Amazon last time I searched for smartcard stuff. On that note, I hate that you can't search for smartcard products anymore without 80% of your results being crypto wallets.

It’s a great way to make money out of crypto!

If there's one thing we should learn from gold rushes, its that you dont make it rich panning for gold, you make it rich selling gold panning gear.
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