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Comment by dave_sullivan | Hacker News Reader

I dunno, Bitcoin loses 65% of its value and it's a scam, but Netflix does it and it's... not a scam?

SVB implodes and investors (but not depositors) lose everything and it's ok.

You're nuts if you think there's no insider trading or pump and dumps on the stock market.

Seems like a double standard.

This all has more to do with maintaining a monopoly on the financial system and certain classes of participant in the US wanting to maintain the power to collect rents. And there really is no counterbalance to their unchecked authority.

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Yes, companies can legitimately lose their value over time. Think of Kodak or Nokia - would you say they are producing as much value as they were in the 90s or 00s?

Now, some stocks have a real value + speculative value on top. Netflix and many other tech companies are in this state, and the speculative value can go down way more than the real value. But the floor for Netflix stock is waaaaaaay above 0. The floor for BTC and similar is 0, by contrast.

As for pump-and-dumps and insider trading etc - sure, they happen, just as thefts and muggings happen. But they happen a lot less then in crypto-land where they are fully legal, and where, even if they weren't legal, no one would be checking for them.

Netflix and other tech stocks did not lose their value over decades, it happened over the course of months. But yes, market volatility is a thing for stocks as well as bitcoin. They're the same in that regard.

"Bitcoin to zero" is a matter of faith at this point, I don't see it happening and I haven't heard anyone explain a good model for how it happens. US is certainly trying its best to outlaw it. Still won't go to zero.

I think my larger point is if the government wants to go after something, go after fraud--in crypto or "Fintech" or banks or stocks or whatever. And mostly they are! But then they're also leaning on banks to cut off the ability to convert crypto to fiat and that's a bunch of bullshit.

You're discussing faith while the parent comment is discussing finance.

Stock buybacks aren't institutionalized insider trading, then?

> Stock buybacks aren't institutionalized insider trading, then?

There are even corporations that announce buyback and then don't do it. For stock it's enough to jump up and then random shareholders that accidentally sell their shares in specific window that allows them to profit from such fake buyback get very rich while people waiting for buyback are left with the bucket. It's completely not pump and dump.

Oh, sweet child of zero interest rates. You can't see how Netflix could go to 0?

Let me tell you about the 90s...

Typically when a business declines it's because a competitor in the market is picking up the consumers sweet dollar dollar. That's why buying whole markets makes sense.

The entire cryptocurrency universe can go away and people can blow their disposable income betting on the horses or eating out instead. There will be no good or service missing in the market.

>There will be no good or service missing in the market.

A lot of services would go missing, actually!

Ransomeware gangs would no longer be able to easily receive their ill-gotten gains. The North Korean regime would lose a major source of funding. Darknet drug marketplaces would have a much more difficult time facilitating illegal activities. Etc.

The difference is the dividend. A stock is a right to vote and a slice of future profits. Stocks are speculation about future profits, which we then build mechanisms to express optimism or pessimism on.

https://en.wikipedia.org/wiki/Dividend

Plenty of crypto tokens also pay the equivalent of dividends - Ethereum, GMX, Balancer, etc. These come from the profits the platforms make. Almost all tokens give you the right to vote.

A stock, yes. But futures? Derivatives? There are tons of speculative financial products that don't grant a right to vote and a slice of future profits.

"Expressing optimism or pessimism" also doesn't sound very scientific or rational.

It’s not that there is no insider trading, it’s that there are government regulators investigating and prosecuting violators.

Just for example the amount of wash trading in crypto is substantial, and if done on stocks would be found and prosecuted.

how can you argue the utility of BTC vs Netflix? one is ultimately fugazy, the other provides a legitimate service. now unless its board colludes to tank its stock price, it's not a scam since the company still does what it says on the tin

How is censorship resistance and unconfiscateability not a legitimate service?

Have you heard about rubber hose cryptoanalysis? The state can literally put a gun to your head and pull the trigger. Crypto is not "unconfiscateable", it's just digital. BTC also isn't "censorship resistant" as the censorious regime can still tie a wallet (and thus its transaction history) to your identity. Used a tumbler service to hide your tracks? Congratulations, now you're guilty of violating anti-money laundering laws, too.

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