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Comment by moralestapia | Hacker News Reader

>some people want to issue a crypto token that represents claims on the estate

What could possibly go wrong? :D

Obviously they should divide it into a low-risk low-return tranche and a high-risk high-return tranche and market two tokens, with an LLM informed of the rules providing final arbitrage.

"It can't literally go tits up"

The Legend of 1r0nyman

Binance has offered to list it on their exchange.

Hilarious! The drama doesn’t end.

I just want a token that represents a claim on the movie rights.

Interestingly its specifically illegal to trade movie futures so a securitized token would not be allowed.

1. https://en.wikipedia.org/wiki/Onion_Futures_Act

What if it was based in the Bahamas?

The onion stuff sounds bad but movie futures sound fine? Wouldn't it be good for studios to be able to hedge? I'm a little confused as to what the instrument is actually for, were it not for this law could I, like, short The Marvels?

It would be horrible and too easy to manipulate, think a fighter taking a dive.

Say the Marvels is coming out, Brie Larson knows everyone hates her and she's a bad actor so it will probably flop. Brie takes out a $10 million short on her own movie.

Now she has an incentive to be horrible so she acts EXTRA bad and treats people even worse than usual to be sure it flops.

Is this any different than the incentives set up by conventional publicly listed companies? Like a CEO in principle could “take a dive” but their compensation discourages that.

CEOs are also usually not allowed to take short positions in the company they head. Analogously, actors should not be allowed to short movie futures they act in.

And they say wit is dead

...it was homicide

I snorted

Naturally, we'll need to tokenize the risk tranche, leverage a decentralized finance protocol to auto-balance the portfolio, and have an AI-powered DAO govern the arbitrage, ensuring our digital assets stay liquid.

That extra computation will put more strain on the energy grid, but that's a good thing, because it will solve climate change.

Few

what disappoints me about this comment is how many of my well-educated non-tech friends would regard the number of technical terms here as a sign that it's a well-researched idea

thats also the kind of feedback I get in teachings from buisness advidors around pitching. "We need to see a little more proof you have credentials to pull off this idea. When we were talking last week you mentioned some technical terms, put a few of those in"

Is that in 3D?

I'd like to subscribe to your newsletter

I think this is a terrible idea, but I fully endorse it because of the chance that it could hilariously result in FTX investors losing the same money twice.

If RWAs were adopted and the tokens were non-custodial then not much. The issue with FTX is it was a centralized company and all funds were fully custodial. And while all this was happening SBF was buddy buddy with Gary Gensler. Aka it was a tradfi problem, not a crypto problem.

Would you please explain why it matters that the "funds" were fully custodial?

not your keys, not your crypto

but it’s a moot point because centralized exchanges like coinbase offer a valuable service of solving a lot of the issues with crypto ux

/solv/hid/

My understanding is the stolen money was fiat from the “fiat@“ account routed through Silvergate Bank.

Customers sent real money to FTX expecting FTX to buy some coin and hold it on their behalf (because managing that properly themselves is out of scope for regular folks).

So now the coin is defacto owned by FTX, not the customer.

Similar to what does not happen when you buy ATT stock in your Schwab account.

That's very similar to what happens with stocks. When you buy a stock, it's Cede & co who actually own the physical certificates that transfer rights. There's a complicated web of contractual obligations between them and other DTCC companies that exists to give you essentially the same rights as if you were a true stockholder, but it's all being done "on your behalf" in a legal sense.

Unless you directly register your stock through a DRS transfer to the issuing agent for the company. This agent manages stock issued to insiders and employees as well but any stock holder can truly own their stock the same way the CEO of the company does. It’s a pain, takes forever, and brokers will play dumb and try to prevent it, but they legally must allow you.

Generally only worth it if you intend to hold your stock for some time (which you should)

Also sometimes you can start them directly with a company (bypassing brokers entirely).

Others will let you send a cheque and buy more. Informal communities exist to buy that first share from another individual so you can continue.

Sometimes all at no charge. Was handier back when brokerage commissions were a thing (and a lot higher).

Did this with GE a while ago (worked out for me!)

Exactly my point. In the Schwab case they don't get to buy yachts with your ATT stock.

Because nobody would've lost anything had they held onto their coins instead of keeping them in centralized exchanges which are essentially banks in all but name. One of the reasons cryptocurrency was invented was to free us from the banks but they reinvented the entire banking system instead on top of it.

It’s very interesting to me because when you put your money in a bank and it enters a bankruptcy proceeding, your account (which is in essence an unsecured loan you made to the bank) disappears into the bankruptcy estate, to be shared by the various tiers of creditors in order of priority (to wit: you lose your money). Of course, the FDIC protects you.

When you put things (e.g., stock) in a “custodial account” with a company like Charles Schwab or similar, if they enter BK then your property is separate from the bankruptcy estate and must be returned to you, in theory.

FTX seems to have combined all the best features of all systems: because they had custody of the tokens, they were able to actually lose them; when they entered bankruptcy, the customer assets could not go to the secured creditors (to the extent that they were custodial, not debt) and they couldn’t go to the customer either (because “not your keys, not your crypto”).

Cherry on top: no FDIC protection. The only winner is the criminal, who is free (for a while) to use customer funds to pay Tom Brady to be his friend.

“Free from the banks,” indeed.

There is only TradFi. Crypto grew up and was assimilated. There is only one holistic system of systems, one vast and immane, interwoven, interacting, multivariate, multinational dominion of dollars.

Paddy Chayefsky, back from the dead?

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