81–90 of 127 posts
I am glad that most of HN had called this crypto/NFT/web3.0/ICO BS loong time ago. That contrasts with Mega VCs, celebrities, politicians etc who were praising this tech-glorified Ponzi scheme. Good job to us!
This has happened in tradfi more times than anyone can count. Lehman, Enron, Madoff, etc. Far more scams in tradfi.
This has been some of the funniest few days in recent memory. Even my crypto true-believer HODL maximalist friends are questioning the entire ecosystem and its value. I think it’s funny that so many people have been hypnotized by get-rich-quick schemes and promises of a utopian monetary system while forgetting what the original —actual— value proposition of crypto was: Buying heroin. As a corollary to “not your keys…
I posted a comment on this in another thread but probably worth repeating here. This is going to be THE compliance case study on two things: 1. Access controls - If the CEO can secretly manipulate records, it's obviously game over. 2. Compliance is sort of an all-or-nothing game. You either do it all, or a sufficiently motivated party will slip through the cracks that you leave.
This is a story of a corrupt CEO. The main crypto part of it is that FTT was seen as actual money on its balance sheets. This individual stealing people's money sheds light on how regulations exist for a reason, especially when handling billions of USD. Doesn't really speak positively or poorly on cryptocurrency as a technology though.
What he did is already illegal.
I know there are inherent issues like high energy consumption in the technology. But I believe that blockchain and the decentralization has some value to it. For example where I'm coming from, I can't accept payments via PayPal, it's nothing to do with PayPal but our government is not pushing to meet the requirements to get PayPal to our country. Also we can't hold USD due to government regulations, if we get the tra…
> people who used it to get rich quick by running these Ponzi schemes The problem with any new currency is that unless an entire government forces it on people, there's no real reason for anyone to use it. Think about it: what use is a currency that no bank will store, no business will accept as payment, and nobody else has ever heard of? There needs to be some incentive to "get the ball rolling". Bitcoin relied on u…
Is it possible to run a crypto exchange 'honestly'? Ie. Actually holding all the assets you claim to hold? I suspect the answer might be no... If you were to set up an honest exchange today, you would be outcompeted by dishonest exchanges who spend all their customer deposits on marketing schemes, referral bonuses, liquidity incentives, etc.
I posted a comment on this in another thread but probably worth repeating here. This is going to be THE compliance case study on two things: 1. Access controls - If the CEO can secretly manipulate records, it's obviously game over. 2. Compliance is sort of an all-or-nothing game. You either do it all, or a sufficiently motivated party will slip through the cracks that you leave.
It's likely that Sam genuinely believed his own deceptions that he created earlier to grift and the amphetamine have eroded his capacity to manage risks such as committing multiple felonies that no other CEO would dare because of its obvious consequences such as spending the rest of your life behind a prison.
I've heard a few legal experts and their take was : Sam & Caroline are going to spend the rest of their lives locked up. The reality still hasn't sunk in yet seeing Sam's wild apology that destroyed his last possible defense of alleging incompetence (he's depiction of himself as a bad coder that caused the situation) with a weird insistence that what he tweeted is not admission.
This is a story of a corrupt CEO. The main crypto part of it is that FTT was seen as actual money on its balance sheets. This individual stealing people's money sheds light on how regulations exist for a reason, especially when handling billions of USD. Doesn't really speak positively or poorly on cryptocurrency as a technology though.
It seems they are learning the same lesson as the OG computer nerd power users: nontechnical people suck and they ruin everything for everyone. Making crypto easy-to-use was the beginning of its downfall.
I know there are inherent issues like high energy consumption in the technology. But I believe that blockchain and the decentralization has some value to it. For example where I'm coming from, I can't accept payments via PayPal, it's nothing to do with PayPal but our government is not pushing to meet the requirements to get PayPal to our country. Also we can't hold USD due to government regulations, if we get the tra…
> people who used it to get rich quick by running these Ponzi schemes The problem with any new currency is that unless an entire government forces it on people, there's no real reason for anyone to use it. Think about it: what use is a currency that no bank will store, no business will accept as payment, and nobody else has ever heard of? There needs to be some incentive to "get the ball rolling". Bitcoin relied on u…
Apart from not stored at a traditional "bank" I think most popular cryptocurrencies have the other 2 aspects. I know it's not accepted by amazon but there are some stores that accept payments.
I think the exchanges act as the "banks" and, I maybe wrong, therefore should be regulated like banks and not the blockchain and the associated technologies because you don't need an exchange to store the currency, you can use your personal wallet or cold storage to store the money.
But on the other hand you can always convert them to standard currency when you need it, so that is not an issue. I just want to have a way to send money across borders without censorship (and not for any criminal activities) because my government and PayPal and banks are not allowing it.
I posted a comment on this in another thread but probably worth repeating here. This is going to be THE compliance case study on two things: 1. Access controls - If the CEO can secretly manipulate records, it's obviously game over. 2. Compliance is sort of an all-or-nothing game. You either do it all, or a sufficiently motivated party will slip through the cracks that you leave.
I think the far simpler root cause of all this is amphetamine abuse. A prolonged state of sleep shortening (he openly talks of using amphetamines and sleeping pills in a tweet from a year ago) and mania causes psychosis. It's likely that Sam genuinely believed his own deceptions that he created earlier to grift and the amphetamine have eroded his capacity to manage risks such as committing multiple felonies that no o…
It seems pretty clear from interviews that they have pretty bad god/savior complexes as well. Would definitely play into the delusions.
This is exactly why you need strict compliance controls! So your drug addicted executives can't go do something crazy