Cryptos make rich people richer, and are sold to poor people the same way lottery tickets are. ”Look at old Pete here, he used to be a loser like you, but he believed and now he’s got $millions in the bank”
If I were to invest in anything related to crypto today, I'd conduct the due-diligence of a lifetime before sinking a cent into the investment, even going as far as hiring private investigators to fine-comb through the people involved. I don't think any tech sector has more veteran con-men than crypto - these folks have been scamming people for a lifetime.
Behind MLM (https://behindmlm.com/) makes a decent job at following the worst offenders
Thanks for the show recommendation.
This whole thing gets more absurd as USD Coin and Binance USD climb to the top with Tether.
The whole space to me feels like such a massive waste of resources and brain power.
They're almost literally financially enslaved to their countries central bank, which devalues their only legal form of life savings by 25% every month by printing more and more (for government members) and no other country will give them banking access but their own, which has regulated against them using any alternative currencies than the one the central bank controls.
Just imagine if the US made it illegal to own any currency besides USD, and then started printing so much that you lost 90% of the value of your savings every 3-6 months.
They've experienced 10,000,000% inflation since 2014. That would turn someone's retirement account of $5,000,000 into $49.95.
The only option there is a digital store of wealth that doesn't discriminate against them based on their citizenship, unlike every central bank in the world. Otherwise, the rug is just constantly being pulled out from under you, and your only legal store of value is the things you can buy in the store and keep in your closet to sell later. Back to a financial system more primitive than in ancient Athens (400BC).
Americans benefit from a global banking structure that is rigged in their favor. Their government prints the global reserve currency, most countries in the world welcome them with open arms and offer banking solutions, and their hegemony is backed by hundreds of military bases armed with tanks, airplanes, and soldiers across the world, and miltiary ships across the seas.
It's very easy for all the rich tech people in this thread living in stable countries to denounce crypto as useless, because to them, right now, it is. But it is careless to denounce it as a concept.
The tweeter mentioned that it is a right wing tool. In the US that has a dirty connotation, and I agree that coming from the US, we can see first hand the dangers of unfettered right wing policy. But people coming from countries that have experienced extreme left wing governments that describe daily common horrors far worse than people peeing in bottles on Amazon's factory floors.
A little bit of sympathy for them and the real life saving use case the "right wing" tool of decentralised finance against the troubles they experience could go a long way.
All that said, I was very skeptical of the crypto community for a long time as well, because it is most of the same people who do MLM schemes. But real life experience has now made it impossible for me to ignore that the underlying tech has real humanitarian use cases as well, and those should be nurtured.
I have friends living in Venezuela, and one of them had to receive medical treatment that he could only afford thanks to a crypto transaction.
Yet, I assure you that crypto was completely irrelevant in that equation. Crypto's only role was ensuring a way for medical professionals in Venezuela to be paid through means other than domestic transactions and out of Venezuela regime's radar. This time around it was crypto, but it could as easily be a transfer to an offshore account. The end goal is the same.
And let's not fool ourselves into believing that people are in crypto to pay doctors.
And I'm under no delusions that much of the crypto market isn't more than a glorified ponzi scheme, my post acknowledges that.
I don't disagree in terms of rich people controlling the crypto ecosystem now. That is one aspect I'm not liking about crypto right now. Too much manipulation, although I think that's at least partly coming from the traditional institutions jumping in and playing the games they do with traditional markets. Plenty goes on behind the scenes in traditional markets, even though they are regulated, and yes, crypto has less regulation, so they probably can get away with more.
I love crypto technology but I think there's stuff going on behind the scenes that regular folk have no idea, and I'm starting to wonder if the grand ideas crypto people have are incorrect. I think the way it will succeed is when big institutions accumulate enough and then it's in their interest to manipulate the crypto market up. I.e. see banks in the Big Short accumulating enough of what Michael Burry was betting on all along, and at that point they revised the indices that track the housing markets, since it was in their interest to at that point.
In the end I don't think crypto is much different than what goes on in equity markets now. Rich people and big institutions control that market too. Meme stocks are essentially also lottery tickets. Way out of balance P/E ratios mean traditional fundamentals are out the window. It's all about momentum and trends now. The one difference, and a benefit I see for traditional markets, is the government will bail them out. The government would be fine if crypto crashes. I think that's the scary part about investing in crypto, but there is also higher potential for upside in crypto markets.
Crypto has never been heavily marketed to poor people. They don't have the capital to buy in at any meaningful scale. The lottery ticket appeal is that you might win $10k or $1m off of a $1 or $2 ticket. There is no mass scale marketing effort pushing $1/$2 of Bitcoin or Dogecoin to poor people with that con-pitch. To this day poor people have barely any stake in the crypto world. For crypto, the lottery players are the small contingent of middle class persons that bother with it (which still isn't very many).
Actual lottery tickets on the other hand, are prominently marketed to poor people all over the place, front and center in many common stores.
Walk into an average convenience store or liquor store, you're telling me they have a large display of dozens of cryptos with updating price quotes appealing to poor people about how big the prizes are and how they can win a million dollars with a $2 ticket? Nope.
I have also met quite a few software engineers who are not poor but don' have nearly the level of wealth of the people manipulating these markets who have gotten involved with this stuff. These people aren't poor but relative to the scammers they are, and when they lose money in hurts. I know one engineer for example who lost his life savings on some alt coins in this mid thirties.
Except for:
- Selling/buying illegal stuff (like drugs or credit cards numbers)
- Ransomware and other scams
With cryptocurrency I'm completely out of luck and my money is gone forever by design.
Bitcoin is about having the option to choose between custodial and permissionless.
XMR really doesn't feel like it offers that.
You can do this without ever having to identify yourself to advertising firms or anyone else.
* Making payments to parties underserved by banks, whether it's legal cannabis dispensaries, or Wikileaks when the credit card companies blockaded them.
* Triggering financial exchanges, without the friction (and risk of PII theft associated with the identity-based accounts that centralized custodians use) of signing up to a traditional online brokerage or exchange, via crypto transfers to self-executing smart contracts like decentralized exchanges.
Crypto is yet-another-trading-market nothing new expect maybe marketing)
Literally nobody in the cryptocurrency space is thinking about how to make fiat fair and sustainable because they actually like the flaws of fiat and just want to amplify them for their own benefit.
The only thing I can think of is stopping the constant debasement that the poorer holders are unaware of.
I don't think cryptocurrencies solve anything though, they're equally not backed and they don't even have weapons or an economy behind
Without a concrete safeguard, we would eventually fall back into the debasement scenario again.
I believe this is the problem bitcoin is attempting to solve. The asset/value is inseparable from the monetary network which makes it easily auditable.
But alt coins is gambling.
They are all believers now.
It does seem like they are just in it to take money from the Retail Investors investors though like they always do. Meaning I have seen to many Bull to Bear Markets, and when the switch happens--it's the Retail investor that looses everything.
(I guess we will know how it all turns out in a few years. If I had Bitcoins, I would sell. The competition is almost exponential. New crypto are coming on daily. Every money licker wants their own crypto.)
However, I don't disagree that retail investors may end up with issues with crypto, but I don't think traditional markets are necessarily safe for retail investors either. Big money controls both crypto and traditional markets. Governments can bail out traditional markets, but in the end big money gets most of the bailout, too. Traditional markets, at least right now, are less volatile than crypto, but things like March 2020 show that they aren't for certain, either. It sounds like we don't really disagree though since you referred to watching various bull and bear cycles.
- Business and work in general makes rich people richer. Remember that rich is very relative. You are a very wealthy person compared to a random person in some countryside in China.
- Considering the previous point, are you saying that people who have some money should not do anything to make more money? Should they stay the same, or should they become poorer? What do you advocate to do this? Prevent them from working? Take money from them forcefully?
All I hear from people in the crypto world is that you SHOULDN'T invest if you don't have money you're willing to lose. Crypto investment is a dream only for delusional people who want to get rich quick. If you do that then lose your money, you don't get to complain. You're free to choose, if you choose wrong, lose, and then not take responsibility for your choice and blame others, then you're truly a loser.
Michael Saylor, the most visible corporate Bitcoin warrior, advised people to mortgage their homes and borrow as much as they could to buy Bitcoin at the literal top of the market (to the day).
The number of people in crypto who believe in a libertarian, anarcho-capitalist world are on the order of 0.01% - the millions of retail traders punting Dogecoin around are just trying to get rich and don’t give a damn about the tech or some greater cause. And that’s because that is how crypto is actually marketed to the masses.
> The number of people in crypto who believe in a libertarian, anarcho-capitalist world are on the order of 0.01%
Where do you get your numbers?
> And that’s because that is how crypto is actually marketed to the masses.
Again, I don't see anyone "marketing" for it. People should understand what they're working with before selling their houses and "investing it" in bitcoin ffs. If they do that then they're dumb!
There is a high concentration of scamming around cryptos. There are the obvious thefts and frauds. But a good fraction of crypto businesses make their money pushing tokens in a manner remarkably similar to pump and dumps.
That said, for the reasons described here (crypto being a wealth transfer to the wealthy), I think it is here to stay.
Because unlike everything else, crypto has been designed from the ground up such that society is unable to rectify the bad elements.
> Again, I don't see anyone "marketing" for it. People should understand what they're working with before selling their houses and "investing it" in bitcoin ffs. If they do that then they're dumb!
Aaaand there it is. A slightly longer form of “DYOR”. If you go around evangelizing something that turns out to be damaging, you’re not absolved of all responsibility simply because you add “not investment advice”. If people who promote crypto really didn’t intend it as investment advice, they wouldn’t say anything. The whole point is that maybe other people will pump your bags. And if it all goes sideways, then you can always point at “not investment advice” because the vast majority of promoters and traders don’t understand the first thing about what a blockchain is, much less “tokenomics” or smart contract code (and exploits).
You may be an expert, and not in it to get rich quick. But you’re naive if you can’t see that the huge majority around you are in it for very different reasons.
In other things in life, there are things like consumer protection. You can tell your credit card agency to refund you, you can use the judicial system to sue scammers. If you lose login secrets to your bank account, you can call the bank, they know who you are, the problem can be solved.
Crypto currency is designed from the ground up with the goal of eliminating all such centralized power and protection mechanisms. Anything that goes wrong is your fault and you have no recourse, and that is not a flaw that will be fixed, that is the most central thing in its design.
Society has protections for the weak, crypto is designed to remove those protections.
This is hyperbolic. There are many insured custody services for cryptocurrencies, similar to fiat banks. Secure storage is a big topic in the crypto space, and it is certainly not a goal of cyptocurrencies to weaken protection mechanisms (centralized or otherwise).
Argument for big blocks: Faster and cheaper transactions (lower fee), as well as more transactions per second. Can use more like cash, i.e. Bitcoin Cash. Everything should be done on-chain. They also argue that small blocks are a money grab from Blockstream so that the network is forced to adopt layer 2 solutions that Blockstream develops.
Argument for keeping block size the same ("small blocks"): Larger blocks means more hard drive space and bandwidth are required, and mining becomes more centralized based on those increased requirements. Big blocks are a money grab from the miners, since they make more money on bigger blocks. An additional concern is if the availability of hard drive space will increase in line with the growth of the network. They suggest to use the Bitcoin Core network more as a settlement layer and a store of value, and not everything needs to be on-chain. They suggest layer 2 solutions like the Lightning Network to use Bitcoin more like cash and enable fast transactions, as well as increase the number of transactions per second. I understand the Lightning Network has some caveats, but from what I've heard from institutions like NYDIG and Strike, that are already using it, it is already working as is.
All I'm saying is maybe it's not just a small problem. The decisions affect a global network and some of the decisions were said to potentially cause major problems.
The point is that there are much bigger problems in a worldwide currency than block size. In comparison, block size is small potatoes. And the block size problem split the community into two that hate each other. They don't just disagree, but consider the other side to be actively sabotaging the system.
You are right though, it is a bit ridiculous. What would you have them working on instead, just wondering? Fixing the environmental issues? Adoption? What else?
Do you have a source for that? Because it's a pretty serious accusation to make.
I take issue with him telling individuals to accrue debt to acquire Bitcoin (companies I have less of an issue taking debt on). That's also the least reasonable part of the interview though. I think overall he makes a lot of good points as to why Bitcoin makes sense in the majority of the interview. However, I'm not one of those crypto people that only looks at one side of this. Yes, sometimes ridiculous things are suggested, but there is some good to this technology, too.
Algorithmic stablecoins like RAI[1] don't have a Ponzi component to them, for instance. You use the dApp and that's it.
Reflexer is collateralized by ETH which is traded 65% of the time against USDT which is backed by chewing gum and hope. This USDT trading determines the price of ETH which in turn determines the collateralization rate of RAI.
What kind of logical fallacy are you trying to make here? If someone sets up an exchange for bananas/pokemon cards and it ends up grossing a majority of the global banana trading volume, that doesn't mean the price of bananas is suddenly backed by pokemon cards.
Furthermore, the mechanism through which Reflexer maintains the stablecoin's price is independent from the collateral asset. It works just as well whether the collateral asset is traded against USDT or fiat.
The mechanism through which that stability is achieved is often 1:1 redeemability for another stable asset through a central portal, but that's orthogonal to the concept of a stablecoin itself.
I didn't feel the need to expound on this as I specified "algorithmic stablecoin" in my comment and provided a link to the project's homepage which features a short FAQ entry answering that very question:
> RAI is actually one of the first stablecoins. What most people call "stablecoins" are actually pegged coins. Pegged coins are oscillating around a specific value (usually pegged to fiat coins such as USD, EUR etc). RAI, on the other hand, is not pegged to anything. The system behind RAI only cares about the market price getting as close as possible to the redemption price.
Unless you mean "understand how the price behaves", in which case RAI is pretty simple too.
The stability of U.S. dollars without the hassle of opening a bank account. Which, generously, means faster transaction times; realistically, skipping AML.
Given Tether doesn't actually hold much cash, it's more akin to a money market fund that pays no interest.