JPMorgan: “crypto collapses have been from centralized players not protocols”
watcher.guru
watcher.guru
It does seem difficult to have a crypto ecosystem (based on those protocols/coins) that doesn't include the pitfalls of regulatory darkness and non-discoverability of capital assets. Investors seem to like having a cop on the beat. Even though the SEC doesn't really do anything, it carries a big stick and keeps market actors in line, more or less. Furthermore, it's a lot easier to verify that a factory actually has tools in it, than to verify that a crypto exchange is functioning properly.
Money inherently has a cop on the beat. When the cop is Venezuela or Argentina or Zimbabwe, its value gets dinged. And it's a lot easier to monitor things like GDP and taxation than to know how one of these acronymic crypto heroes is running his exchange.
Would you be willing to expand on what you mean here? I am genuinely interested in hearing your thoughts, hoping to help inform and strengthen my own.
> one of these acronymic crypto heroes is running his exchange
Totally agree on this.
> math involved with the coins themselves, it's hard to disagree with you
I’m really talking more about the consensus protocol ideas, but of course the cryptography is important to any modern financial system
Regulators barely understand equities let alone crypto, and they haven't taken the mantle of regulating crypto quite yet. People in regulated markets do a lot of malicious and illegal things. Imagine an unregulated one.
> capital assets
It's a lot easier to see what an aircraft manufacturer owns than to see what a crypto exchange owns. You might be able to run FTX from an armload of Raspberry Pis, but you can't run Boeing that way. Binance doesn't have inventory and real estate like a retailer. To compare a crypto exchange to a commodities exchange: it's easier to characterize the future value of aluminum or gold than the future value of a cryptocurrency -- not only because metals are more liquid, but also because they have been around far longer. Nobody knows the real value of crypto, so it's hard to know what assets a crypto-business is actually holding at any given time.
Why invest in a space where there are no rules and you can't see what everyone owns or how they use their resources?
How did any government fail in FTX, except in the sense that they don’t regulate exchanges like banks, which nobody in cry-to wants?
Where did I say anything about gov being involved in FTX failure?
The entire point of this excercise is to not have banking and finance. Those who listen to middlemen who 'want to hold your wallet' will learn the same lesson over and over. Every centralized exchange will collapse or 'be hacked', as the founders like to call taking your money and moving it elsewhere.