Is crypto era over?

silliussoddius

F***ing hell, this from the man telling US congress and the world that crypto is the future. As with WeWork, Theranos etc., are these people delusional or sociopaths.

https://www.yahoo.com/finance/news/ftx-employees-were-claiming-expenses-051144044.html

Dasein

good post by former AWS engineer that tallies with my own thoughts on the blockchain hype

https://www.tbray.org/ongoing/When/202x/2022/11/19/AWS-Blockchain

when I think of all the people over the years telling me "oh you just don't get it" - people who would think C++ was something you got in the leaving cert - 🙄

Dohnjoe

I once pitched a dead crypto project to a friend who turned around and said it sounded amazing and could be huge. It's so easy to sell crypto; it's a "future" thing, with fancy technology things on it, cool sounding complicated bits and here's all the hypothetical solutions it could provide to problems that don't really exist (but don't mention that part). Couple that with the fact that the majority of people don't really know how money and currency and inflation and economics really work. Add the whole "you're getting in early" thing on top.

It all just combines to form these hype cycles that result in massive bull runs - which themselves attract people (and predators) to the sphere as there are vast amounts of money to be made. The whole thing is a self perpetuating loop. Each time another layer of people learn that it's mostly BS, but there's always a new layer of (sorry) fools who are easily parted with their money.

If prices drop low enough again I'll be investing again, why? Because I'm investing in the distinct possibility that another hype run will form in the future and I can sell what crypto coins I have at stupidly inflated prices.

erlichbachman

"Couple that with the fact that the majority of people don't really know how money and currency and inflation and economics really work"

So true, if people really did understand how money and banks work then crypto would only solution to the problem.

patsy_mccabe

https://www.boards.ie/discussion/comment/119945514#Comment_119945514

" If prices drop low enough again I'll be investing again, why? Because I'm investing in the distinct possibility that another hype run will form in the future and I can sell what crypto coins I have at stupidly inflated prices. "

You're still just gambling. Invest in productive assets.

silliussoddius

https://www.boards.ie/discussion/comment/119945628#Comment_119945628

It would.

I see that chancer Bitboy is threatening to release his conversations with SBF if he doesn’t agree to do an interview with him.

Dohnjoe

https://www.boards.ie/discussion/comment/119945692#Comment_119945692

Good advice and I am invested in productive assets. My side investment in crypto (relatively small amounts over the years - of money I could afford to lose) has made exponentially more than everything else put together, and that was after making a ton of mistakes with crypto over the past decade. I've also liquidised a good portion of it (last run) so thankfully t's not just paper gains.

I have a relatively modest amount of cash, good to go, that I will re-invest IF certain crypto hits specific low prices. Again, I don't have much faith in crypto itself, however I do have plenty of faith that people will still throw money at it. Maybe not as wild as the '21 bull, but certainly another hyped run in the future.

I've been through several "crypto is dead" bears on this forum, the sentiment is always the same. In terms of prices, we aren't always talking long periods of time, Ethereum, one of the top cryptos, bottomed out at around $100 in March 2020, just over a year later it was 40x that price, at $4,000.

To some outsiders it might seem like a random rollercoaster, total gambling, but for those of us who are masochistic enough to follow this stuff, it's been so far possible to realise some very nice gains using relatively simple patience and discipline. (Again, usual disclaimers, no one knows what's going to happen in the future, past is no indicator, yadda, yadda)

LuckyLloyd

‘Blockchain is a solution in search of a problem’

A beautiful simple summary.

erlichbachman

tbf it doesn't have to look very far when we see how traditional centralised finance is constructed

Shedite27

https://www.boards.ie/discussion/comment/119947741#Comment_119947741

Reminds me of early internet in that respect

LuckyLloyd

https://www.boards.ie/discussion/comment/119947987#Comment_119947987

I wouldn’t agree. The early internet was providing you information around the world, you were able to chat with people instantly, etc. It was immediately adding clear compelling value across fundamental use cases (I want to know things; I want to communicate with people; I want to find like minded people from across the world also interested in things I like) in a different and better way than existed outside the Internet.

All of that was to be improved, made more accessible and mass marketed with the crucial addition of E commerce - but I don’t believe it was as difficult to see the mass adoption reality 13 years in (Internet was available in Ireland in 1991, so we are at 2004 in Crypto terms).

By 2004 widespread adoption of the Internet was well underway with email starting to become embedded in the corporate world and more and more households going online with each passing month. Crypto doesn’t seem to have made anywhere near the same amount of progress imo.

Shedite27

https://www.boards.ie/discussion/comment/119951561#Comment_119951561

Early internet was 60's/70's, used by the military. Took 30 years for Amazon/Google/Facebook to figure out the billion dollar idea. It required a huge mass of individuals to adopt it before it was worthwhile, took another 10/15 year for technology to evolve to the point that Netflix etc was possible.

Every technology, be it internet, blockchain or more recently big data starts off with the nerds developing something, then eventually some visionary figures out how to mabe billions on it. We haven't found that visionary with the idea yet. And FWIW, I don't think "owning bitcoin" is goign to be enough to make others rich, it'll likely be confinded to investors in the visionary

Supercell

There's never going to be free money handed out to every american again like there was during Covid, Tesla rescued it when that pump ended by buying a huge load. If Tether is indeed a fraud as many news stories online indicate, that will be final straw that breaks bitcoin once and for all. Playing with fire imho.

LuckyLloyd

https://www.boards.ie/discussion/comment/119952481#Comment_119952481

Early internet is not a reasonable comparison to crypto. There was no way to effectively distribute or use early Internet in a widespread level for decades after invention. It was a technical innovation inaccessible to the populace.

By contrast, Bitcoin runs and works on a laptop with an Internet connection. Infact, it became inaccessible to a default user quite quickly as the value from mining was adopted on a widespread level increasing tech spec barriers to entry. We are nearly a decade into Crypto being available and tradable on a mobile phone.

It just doesn’t do anything useful yet. Even though it is widely available and accessible. That is to say, it does specific things. But those things are yet to prove themselves as intrinsically valuable or necessary.

Shedite27

https://www.boards.ie/discussion/comment/119952977#Comment_119952977

Yeah but it's not about how long it's with the "techies", it's how long it becomes used by normal folk that's important. That's when you find the magic moment when someone who has no idea what blockchain/cryptocurrency is, stumbles across it with a problem that they had in their head. Cyrpyocurrency is available to everyone, but it's not very widespread yet. When the adoption is more idespread, the chance of finding the perfect use case for it increases.

Dohnjoe

https://www.boards.ie/discussion/comment/119954108#Comment_119954108

This is the "appeal to future" thing I've been hearing for a very long time. It's usually part and parcel of dogma to sell crypto to others, to make them believe they will have something which will have some fantastical use in the future and hence be worth lots of money.

The reality is that most crypto is garbage, convoluted solutions to problems that don't exist, artificial fuel tokens that have no place on a secondary market, meme-coins, artificially scarce things that really do nothing but be digitally scarce (so better snap them up before the next guy does) and so on. I'm not saying it's all totally useless, but if a company/business/industry wants to use it for a thing - they can usually just replicate it themselves to do that thing.

Decentralized technology is alright, got some decent uses, but it's not earth-shattering stuff. Centralized databases work fine and are often better. Crypto's main use is speculating/trading, aka hawking money off some other poor schmuck by selling them hype, bamboozling them with tech prophecies, and keep doing it year after year. I don't see that changing any time soon.

Emblematic

https://www.boards.ie/discussion/comment/119952481#Comment_119952481

Cryptocurrency is kind of the opposite of the internet though. The early internet was useful from the very early on with email, file transfer, remote control of computers etc. This was before it was even called the internet. What was slow was people's appreciation of how important it was going to be, yet an awful lot of it was already there. I think before 1990, it was illegal for the public to be provided access to the internet but by 1995 Amazon was selling over it to the public. That's a very short length of time.

Crypto currency by contrast has been around about 13 years but we're still debating whether it has much of a use beyond financial speculation.

Potatoeman

It’s amazing how people rewrite history in their own heads. The early internet was a very niche and expensive hobby. This is 1995 when it was just entering the mainstream before this it was links in print magazines for enthusiasts or even the phone book.

https://m.youtube.com/watch?v=1npzZu83AfU

quokula

https://www.boards.ie/discussion/comment/119958256#Comment_119958256

What that ad tells me is that in 1995, before internet access was widespread, there were already obvious and compelling uses that could be shown in an advertisement. Most of the cornerstones of the modern internet are already present in that ad - email, chat, travel booking, ecommerce, looking up information, access to publications etc are mentioned and they were all already possible at that time, just in a much more basic and limited way than today.

On the other hand crypto has been easily accessible for years now, pretty much everyone has at least heard of it, but it still wouldn't be possible to put together an ad like that which would show compelling real use cases beyond speculation.

Potatoeman

https://www.boards.ie/discussion/comment/119958402#Comment_119958402

The internet was officially made available to the public in 1983, this is twelve years later. At this point personal computers were already becoming popular, though expensive the extra cost of an internet connection was nominal compared to the cost of the PC. Back then people were saying the internet was pointless too.

Bitcoin launched in 2009, Ethereum in 2013 which has smart contracts. Crypto is still relatively early in its adoption. It’s in the last few years that the number of projects has increased and competition has taken off.

LuckyLloyd

Leaving aside the Internet comparison, there is also this huge unresolved tension in terms of the “future” of crypto also. Mass adoption will require regulation, KYC, consumer protections and legal recourse. All of these things are the antithesis of why many people involved in the space were attracted to it in the first place.

If Crypto has a future, the nonsense libertarian anti state philosophy will necessarily be discarded. Sure, in unstable states crypto has appeal as a better alternative to corrupt central actors. But the gold in them hills is in the developed world and the integration of crypto into the daily lives of wealthier populations. Barring a calamitous collapse of Western Political and Financial systems crypto is going to have to bend the knee to fulfil its promise.

joeguevara

I like reading some of the threads here but I don’t think I’ve posted that often apart from a few times in relation to binance. A lot of interesting points, thoughts and advice.

in my professional career I’ve moved from criminal law to aml to heads of compliance n trad fi investment firms and last year moved to head of legal and compliance and legal in a worldwide crypto firm. We are just finalising to digital asset business licences in Bermuda and im making the move there.

So here are some of my thoughts of this industry in probably one of the most turbulent times in it. Firstly the level of industry expertise n governance, compliance, audit, reconcilliation, asset segregation, custody etc is astoundingly bad. While obviously the technology expertise is cutting edge, you have junior compliance legal filling roles that in tradfi they wouldn’t even be junior staff.

The fact that everything is decentralised and basically trumped up spreadsheets means that even when checks and balances work is done it’s done on doctored information. Also few traditional banks and custodians are operating in the space means that the banks that do are easily swayed into unscrupulous practices.

Some of the products that were being offered are so ponzu, would have made madoff look like Francis of assisi. But it was easy to get away with it because regulators side stepped it. If you look at how hard the eu comes down on payment service providers or electronic money institutions or even insurance intermediary but ignored crypto exchanges, nft rug pulls, billions of assets stolen it’s surreal.

Ftx was crazy. SBF literally admitted it was a Ponzi scheme but was lauded as a genius. I had a mifid firm who got a phonecall from the central bank an hour into an ulster rugby match In Belfast telling them to take down an advertisement behind the posts but ftx can sponsor 100s of millions with no push back.

what I have learned is no one can predict the future and anyone who says they can is a charLatan. We deal only with institutional clients who arb direction at clicks of 100s of millions a day. They are eerily quiet because they just don’t know. But equally crypto is not dying. The fact in the last year we have blow ups of equal proportions to Enron bearings madoff and every other one in between and still have btc stuck at 17k is testament to that. It’s the players that need to improve not the concept. I do think the worldwide regulation starting with mica is a step in the right direction but fcucking hell the amount of thieves- snakeoil salesmen and equally moronic customers is like a movie. Coffeezilla on YouTube is a great resource to see each horror story. Next week I’m in involved in a landmark legal case that will test the defi concept of digital asset versus the legal definition of property which is exciting. I’ll try and update as long as no conflict.

joeguevara

Another thing that I think is an issue when it’s discussed or reported on is the blanket term crypto and the future of same. That blanket term covers so many types of assets, technology, tripe, pipe dreams, and sh1t that to lump it all in together is akin to trying to discuss every element of let’s say quantum physics in one sweeping conversation (note that analogy might be an incorrect one but hopefully you see where I’m coming from)

The disparity between a fcucking bad picture of an ape and a token that allows security in a contract is like the difference between a kids drawing of a horse and the technology allowing insulin to be released in the pancreas of a racehorse. It’s not the same and needs to be addressed. Also the shilling of digital assets by celebrities on social media like tik tok and insta with rug pull after rug pull for years before the authorities stepped in was incredulous.

maninasia

https://www.boards.ie/discussion/comment/119878036#Comment_119878036

Imagine being able to access an interest rate outside of Ireland instead of being stuck with local banks? Thats a big one right there.

Imagine your investors could come from anywhere in the world?

Lots of reasons .

maninasia

https://www.boards.ie/discussion/comment/119878385#Comment_119878385

Blockchain helps to cut out the middle man when done right.

You can access truly international pools of money, and for very low transaction fees. It is not a percentage of the total transaction.

Opening up global markets and services for local assets could be very interesting.

Look at Ireland we only have three banks ffs.

joeguevara

https://www.boards.ie/discussion/comment/119978357#Comment_119978357

Ok what interest rate in a bank is attractive. And I’m talking a traditional bank. An investment fund with a segregated custodian and a competent investment manager will always trump a bank. Now I understand what you are saying a digital asset service provider that’s offering high interest rates and can be accessed anywhere in the world. But at present it’s the emperor’s new clothes. Genesis, voyager et al fail because of basically ponzi.

concept is great. Execution is poor.

joeguevara

https://www.boards.ie/discussion/comment/119978358#Comment_119978358

But people don’t invest in banks. We also have one of the worlds biggest funds industry in the world with assets managed of over 2.8 trillion. Over the next year or 2 the whole concepts of global markets will diminish. Consumer protection will increase but at the cost of cost. Legal compliance regulation regulators custody etc cost money. It won’t be the defi concept that was initially envisioned

maninasia

Imagine being able to borrow on an interest rate not locked to the local interest rate. For example a mortgage.

Get it?

I have used only true defi so far. Hence funds are safe.

Agreed current situation needs improvement !

https://www.boards.ie/discussion/comment/119978372#Comment_119978372

https://www.boards.ie/discussion/comment/119978357#Comment_119978357

For this to happen, these institutions would need to be able to take back your property or car etc. So crypto would have to become extremely regulated, and then as it got more regulated to the point where someone would give you a 500k loan, the same laws that might forbid that international sort of lending would come into play.