10+ years on, billions of dollars poured into various coins and ICOs and still nothing to show for it. It's like an even nerdier Star Citizen.
Over $9 billion is now locked in DeFi apps - https://defipulse.com - Instead of being like the ICO bubble, in DeFi you lock your money up (not exchange it for a worthless token built on vaporware).
Those ICO issuers have a great business model, haven’t cracked recurring revenue yet, but alot of revenue!
There is also a large services sector, no different than the adtech sector or any other sector with questionable utility.
I worked on many mobile apps that weren’t worth it for the company, and was praised for it. But crypto is the one that has to convince you of...... what?
“There are alot of customers, go where the customers are - Except if it’s crypto, then I’ll just spend all my energy talking about unrelated crypto issues in a incoherent tirade.“
I completely understand how to hold seizure-free assets, some of that involves the discretion of a judge with cash and physical property held in trust's name, some of that involves the permissionless nature of crypto, stored properly. Its just a tool and it's actually pretty okay at what it does.
In other areas, 10 years ago I couldn't convert an international wire transfer into a domestic wire transfer, now I can and it avoids greater compliance scrutiny and speed, while retaining unlimited amounts, and inherits same day settlement. (corporate transaction another country paid in crypto, converted to fiat in local bank, transferred to local brokerage account, 6-7 figures or higher.)
Without crypto, I as of recently have transferwise and now Revolut to do the same thing, which both have an extremely long list of unsupported businesses and transfer limits that are pretty decent but not as good.
There is a slower regulatory process of making any of this practical, which is still happening, such as the processes that allowed Kraken to get that bank charter. Wyoming's laws were passed in 2018, went into force 2019, and Kraken was in regulatory approval since then. On the federal level, of OCC just gave its gracings to national banks to custody digital assets, this year! This will be challenged, primarily by Wyoming lobbyists, who wants Congress to make that order or not. Only Bitcoin has risk management financial products, not even Ethereum yet, in 2020.
There is also a large market of customers in the crypto arena, and high margin business models that don't require that many customers in order to book 7 figures of revenue.
As it stands today, you can lend at your coins at a yield rate close to the borrow's lending rate. That effectively makes all lenders, collectively, "the bank". It also means that borrowers will get a competitive rate for borrowing against their collateral.
This will end the days of getting 0% in your savings accounts while the bank is getting 10% lending out your money once people realize they can lend out their dollars themselves for a much higher yield.
It also lets you lend out your speculative crypto investments. Imagine if you could buy AMZN or NFLX and also lend it out to other people on margin. That's exactly how a margin account works, but of course your brokerage isn't going to let you do it. Crypto lets you play the role of issuing the margin rather than borrowing it, if you so choose.
People that are dismissing crypto have no idea what a revolution in finance this is going to cause.
And you can't buy and hold but also lend AMZN or NFLX with crypto. Sure, you can buy assets that don't have real profit streams attached and lend them to short sellers, but I have no idea why anyone would think that revolution would be a net benefit to them....
I think the analogue is Ally bank, which is known to give the largest returns on savings accounts, currently yielding a whopping 2%. Compare that with a crypto-ecosystem lender like Nexo which is yielding 8-10% on the same asset (USD).
> Sure, you can buy assets that don't have real profit streams attached and lend them to short sellers, but I have no idea why anyone would think that revolution would be a net benefit to them...
That's one of the profit streams my stock broker uses. Why shouldn't it be available to me?
The reason why you don't have access to any of these money-making "institutional" products (like lending stocks, underwriting insurance, or serving as a market-maker) is because they require a lot of administrative overhead. When you replace them with smart contracts, you democratize all of these services.
In a few years, it will be common for people to buy/sell/lend/insure all kinds of assets (physical, virtual, derivatives) from their phone without a middleman.
You can do it today if you're an advanced user with enough money to overcome the currently high transaction costs.
Only if you think that due diligence and actually collecting the repayments is inefficient. Someone like LendingClub will do all that for a 1% overhead with plain old fiat though if you don't want maturity transformation and deposit insurance.
I'd say it's a bug rather than a feature of the crypto ecosystem that people who sneer at 'numbers on spreadsheets' can 'earn 10% interest' if they buy enough tokens from a website whose 'institution license' page tells you what a license is but doesn't tell you which country they're headquartered in, never mind what licenses they actually hold. It's not removed the middleman so much as anonymised him and made it more likely he's running a Ponzi scheme.
I do think that! The due diligence you're describing is only necessary because the custodians can actually improperly handle the money. Embezzlement is a real thing in the traditional system.
Give smart contracts a few more years, and you're going to be more skeptical of the existing system of due diligence with custodians (which we know can be abused) when compared provably secure smart contracts (which we know can have bugs, but will eventually be stable).
If you think crypto is all a Ponzi scheme, you probably haven't been following it for the last couple of years.
Also if you think the traditional system is not a Ponzi scheme, you probably don't understand how it works.
Due diligence with loans has nothing to do with 'embezzlement' and everything to do with evaluating the creditor's probability of repayment from future earnings. You can't assess whether someone's business plan is high or low risk with a smart contract.
Embezzlement is more likely to be a problem when you're giving your money to a service as obviously shady as Nexo (a website which in addition to having the unusual model of borrowing fiat at 10% to lend it out at 5.9%, pointedly avoids saying where its based even in its legal documents, or what licenses it holds on its 'view licenses' page, but is very keen to promote what licenses and audits its founders' other business has in its marketing material...)
Firms like Nexo use the yield farming services to make their questionable business plan viable! We will never know exactly what they were doing before but now they use decentralized versions of themselves.
Now this inevitably requires you to move the goal post to the critique that customers money is being put in smart contracts, good news there is also smart contract insurance that many people buy. I’m not kidding, 70% serious, that’s it’s own nuanced discussion but requires you to get off of a hill stuck in 2018.
But it is incredible how much crypto has changed since 2018. Back then I thought, well, maybe some day this will work. Now it's obvious that it will work, and I think adoption will be rapid once it starts happening.
I won't be surprised if there's a big wave of crypto stuff on HN/reddit/elsewhere again soon. Just like 2017, but this time it's actually useful for something.
I don't think anyone was disappointed with where the Internet was in the early 80s and 90s, and that's because it fundamentally opened up new avenues for people to express themselves, new ways to interact. It wasn't perfect, but it created something new nobody had before. Many things!
The ability to move money online has been with us for decades. It's not new, either. Crypto doesn't open up any new capabilities except harder-to-track ransomware payments.
Imagine if Facebook did something like this with $FB stock to reward it's early users: https://www.theblockcrypto.com/linked/78255/140k-addresses-u...
As a software engineer you know bugs exist. Software as immutable monetary contract law which cannot be appealed to anyone is a doubly bad idea as any bug is a vector for literally everyone losing literally everything, forever. Plenty of examples exist. Remember the DAO? Nothing's changed since then except people decided to "be more careful next time."
> Imagine if Facebook did something like this with $FB stock to reward it's early users.
Why would a company do that? It doesn't make sense. If a service is valuable you don't need to pay people to use it, they pay you to use it. You know, business, where money is exchanged for goods and services?
OpenZeppelin has this in their deployment packages now
People have often been giving the keys to update to multiple community members now
Yes, fraud can be a good business if you don't get caught. So can lots of crime.