Crypto lending company Babel Finance halts redemptions and withdrawals(babel.finance)
babel.finance
Crypto lending company Babel Finance halts redemptions and withdrawals
https://babel.finance/article-views.html?id=50
187 comments
> (Oh, look, Tether's involved again. How much of the $160M in their claimed "shareholder capital" at https://tether.to/en/transparency has evaporated in the last month? They're currently claiming it hasn't changed by more than $50 since a month ago; https://twitter.com/jjjbtc/status/1524819806892982272)
If you need any strong suggestions that Tether's asset statements are a pack of lies, this is it. They claimed to have--before the cryptocurrency collapses started--an equity buffer of around 0.2% of total assets. Now they claim to have unwound ~10% of those positions in a market environment where selling any of those assets (even something like US treasuries!) would realize enough loss to wipe out that buffer. Instead, their equity buffer increased by something like 0.00001%.
If you need any strong suggestions that Tether's asset statements are a pack of lies, this is it. They claimed to have--before the cryptocurrency collapses started--an equity buffer of around 0.2% of total assets. Now they claim to have unwound ~10% of those positions in a market environment where selling any of those assets (even something like US treasuries!) would realize enough loss to wipe out that buffer. Instead, their equity buffer increased by something like 0.00001%.
Surprisingly (or suspiciously) steady financial results are also a fair marker of an offering being a scam or fraudulent, particularly when there's no explanation beyond "good management practices."
Since a pure fraud makes up its books, it's easy to declare a steady path of returns. Reality tends to be more complicated, and delivering steady returns in a turbulent market is both hard and expensive (by way of hedging contracts).
Since a pure fraud makes up its books, it's easy to declare a steady path of returns. Reality tends to be more complicated, and delivering steady returns in a turbulent market is both hard and expensive (by way of hedging contracts).
If my bank withheld my withdrawals of my money, I'd not behave the most even tempered way.
Whilst I DO think crypto is a scam, or at best a very terrible waste of time and effort from all involved. I will accept that I could be wrong.
But, scam or not, this early turbulent history will cement a stigma of crypto being synonymous with grifters and scammers. I don't see a future in it.
It'll be interesting to see if btc breaks through the 20k barrier today and what effect that has on the hype.
Whilst I DO think crypto is a scam, or at best a very terrible waste of time and effort from all involved. I will accept that I could be wrong.
But, scam or not, this early turbulent history will cement a stigma of crypto being synonymous with grifters and scammers. I don't see a future in it.
It'll be interesting to see if btc breaks through the 20k barrier today and what effect that has on the hype.
People mistake Bitcoin, which has no central custodian and will continue clearing transactions all day long, every ten minutes, immune to all interference, with the rest of 'crypto', which is a giant money-lending dumpster fire that isn't backed by anything.
Once all the dust settles down Bitcoin will keep ticking along just like it's been doing for years.
Once all the dust settles down Bitcoin will keep ticking along just like it's been doing for years.
For good reason... Bitcoin enabled this ecosystem, and a currency is ultimately only as good as its ecosystem. For example, Roman Denari are worth nothing as a currency [1]. No banking system accepts them.
[1] Used Denari because it's an old currency I know. Of course, there's collector value, but there are other useless currencies today I've never heard of worth nothing on the collector's market too. Unfortunately, I can't cite any, given how useless they are today.
[1] Used Denari because it's an old currency I know. Of course, there's collector value, but there are other useless currencies today I've never heard of worth nothing on the collector's market too. Unfortunately, I can't cite any, given how useless they are today.
Besides Terra (LUNA), Celsius Network (CEL), 3AC, and Babel Finance —- are there other examples?
* As is, while clearly some of these failures have had a massive impact, there clearly a lot of DeFi projects of significance still standing:
https://coinmarketcap.com/view/defi/
* As is, while clearly some of these failures have had a massive impact, there clearly a lot of DeFi projects of significance still standing:
https://coinmarketcap.com/view/defi/
Babel was pretty important to other lending institutions.
Here are dominos to fall ahead of us:
- BlockFi
- Voyager
Somewhere down the line, tether is also standing. We know they're insolvent, the question is when redemptions become a problem. And at that point, the abyss
Here are dominos to fall ahead of us:
- BlockFi
- Voyager
Somewhere down the line, tether is also standing. We know they're insolvent, the question is when redemptions become a problem. And at that point, the abyss
> Besides Terra (LUNA), Celsius Network (CEL), 3AC, and Babel Finance —- are there other examples?
but other than that how was the play Mrs Lincoln?
but other than that how was the play Mrs Lincoln?
Care add something substantive to your response?
* Explanation of comments meaning: https://www.urbandictionary.com/define.php?term=Other%20than...
* Explanation of comments meaning: https://www.urbandictionary.com/define.php?term=Other%20than...
It's only self-evident if you're American and remember your history.
Abraham Lincoln was shot at a play, his wife Mary Todd Lincoln was sitting next to him.
The implication is to say 'even though your husband and President of The United States was just shot next to you, how was the play otherwise'
Meaning the recipient is being obtuse to the situation or is unaware of it.
I think what he is saying is that the avalanche is falling, and so it doesn't matter that some are left- they won't be for long.
Missing the forest for the trees.
Abraham Lincoln was shot at a play, his wife Mary Todd Lincoln was sitting next to him.
The implication is to say 'even though your husband and President of The United States was just shot next to you, how was the play otherwise'
Meaning the recipient is being obtuse to the situation or is unaware of it.
I think what he is saying is that the avalanche is falling, and so it doesn't matter that some are left- they won't be for long.
Missing the forest for the trees.
Urban dictionary doesn’t even have the correct usage (and surely should not be your first point of reference). So please, try to add something substantive to _your_ response.
Most things collapsing aren't defi, with the exception of Terra which, as an algo stable was expected to fail like all algo stables before it.
Celsius/3AC/Babel are all not defi and we would know about their health and risk factors much sooner if they were defi.
Celsius/3AC/Babel are all not defi and we would know about their health and risk factors much sooner if they were defi.
DAI is doing just fine and will continue to do so.
What is celsius if not defi?
Its completely centralized. They take user funds and put them in defi products, but the funds are completely under Celsius control not the users control. Thats how they were able to turn off withdrawals. Its like if JPMorgan were putting client funds in AAVE, that doesn't suddenly make JPMorgan defi.
That makes sense... Is the alternative individual users using some type of smart contract to borrowers directly? It seems like in that case there would indeed be more transparency, but also that the end state of many, many leveraged positions being liquidated would be pretty similar, right?
Well in the case of Celsius they are putting use funds into things that the user might not know about. Such as stETH which provides yield but can't be withdrawn back to eth until months down the road so if stETH starts trading at a discount like it did recently then you can't actually get all the money out for redemptions. I believe they also put funds into Terra which they lost as well. So basically Celsius advertises a certain yield but is a black box after a user deposits funds and they might put the funds in things a normal user would never agree to if they were aware of it.
aaaaaaaaata(2)
Remember when crypto was supposed to be the "holy grail" against the current economic situation?
Edit:- the cycle of upvotes and down votes on this comment hahaha....
Edit:- the cycle of upvotes and down votes on this comment hahaha....
The concept is sound, implementation is what matters. Blockchain and crypto got hijacked is all.
The concept was not sound
We've had tens of thousands of competent software engineers working on this for the last 5 years and no one came up with anything more than gambling in a closed zero sum ecosystem.
We've had tens of thousands of competent software engineers working on this for the last 5 years and no one came up with anything more than gambling in a closed zero sum ecosystem.
No, they didn't. This was always inevitable, based on it's inherent properties.
"No true blockchain"
+1...though Edison's old quote about genius being 1% inspiration (concept), 99% perspiration (implementation) immediately comes to mind.
From a longer-term point of view...the ways in which blockchains & crypto are going wrong look amazingly similar to things which kinda regularly went wrong, ~1.5 centuries ago, with under-regulated brick & mortar banks, securities, & such. "Backed by real gold in the vaults!" didn't mean much, when there were few checks that said gold was really there (some groups of banks had only enough gold - collectively - to pass an inspection at one of them), paper "gold-backed" notes & securities could be printed with only the backing of other such pieces of paper "backed by someone's gold, somewhere, supposedly...", etc., etc.
From a longer-term point of view...the ways in which blockchains & crypto are going wrong look amazingly similar to things which kinda regularly went wrong, ~1.5 centuries ago, with under-regulated brick & mortar banks, securities, & such. "Backed by real gold in the vaults!" didn't mean much, when there were few checks that said gold was really there (some groups of banks had only enough gold - collectively - to pass an inspection at one of them), paper "gold-backed" notes & securities could be printed with only the backing of other such pieces of paper "backed by someone's gold, somewhere, supposedly...", etc., etc.
If something only and exclusively works in theory, it doesn't work.
So it was the world that failed crypto, not the other way around? The purity of your faith is impressive.
this reminds me a bit of 'not real communism' or 'not really free market.'
The basic concept was that mathematical limits made crypto fundamentally anti-inflationary: you can't debase the currency by minting more of it in response to exigent circumstances (you could wonder whether some inflation should exist to account for population growth and the demand that goes with it, but that kinda presumes universal adoption),
The problem was that while the minting of a cryptocurrency can be mathematically self-regulating, there's no barrier to just setting up more cryptocurrencies. A big reason I have not become more heavily involved/invested in crypto was that everyone I asked about the utility of having ~15,000 different virtual currencies hurriedly changed the subject. How is a rational investor supposed to choose between the proliferating altcoins and shitcoins...and why? The only honest answer I ever got was 'throw money at a bunch of cheap things and then shill the fuck out of them in the hope that they become expensive.'
Crypto just swapped inflation in the currency supply for inflation in the number of currency instruments.
The basic concept was that mathematical limits made crypto fundamentally anti-inflationary: you can't debase the currency by minting more of it in response to exigent circumstances (you could wonder whether some inflation should exist to account for population growth and the demand that goes with it, but that kinda presumes universal adoption),
The problem was that while the minting of a cryptocurrency can be mathematically self-regulating, there's no barrier to just setting up more cryptocurrencies. A big reason I have not become more heavily involved/invested in crypto was that everyone I asked about the utility of having ~15,000 different virtual currencies hurriedly changed the subject. How is a rational investor supposed to choose between the proliferating altcoins and shitcoins...and why? The only honest answer I ever got was 'throw money at a bunch of cheap things and then shill the fuck out of them in the hope that they become expensive.'
Crypto just swapped inflation in the currency supply for inflation in the number of currency instruments.
Same as communism.
Not true. Communism is inherently inhumane.
This article gives some context, including this:
> At the end of 2021, Babel Finance had an outstanding loan balance of over $3 billion, up from $2 billion the previous February. It averaged $800 million in monthly derivatives trading volume and had structured and traded over $20 billion in options products.
https://www.coindesk.com/business/2022/06/17/babel-finance-s...
The ripple effects here are going to be substantial and unpredictable. This was a toy bank/hedge fund that grew to monstrous proportions. Now that bank is experiencing a run and it has done what every bank before it facing a similar problem has done: blocked withdrawals.
Please explain to me the difference between a bank and a Ponzi Scheme.
> At the end of 2021, Babel Finance had an outstanding loan balance of over $3 billion, up from $2 billion the previous February. It averaged $800 million in monthly derivatives trading volume and had structured and traded over $20 billion in options products.
https://www.coindesk.com/business/2022/06/17/babel-finance-s...
The ripple effects here are going to be substantial and unpredictable. This was a toy bank/hedge fund that grew to monstrous proportions. Now that bank is experiencing a run and it has done what every bank before it facing a similar problem has done: blocked withdrawals.
Please explain to me the difference between a bank and a Ponzi Scheme.
>Please explain to me the difference between a bank and a Ponzi Scheme.
Banks are forced to abide by regulations and laws dictating how fractional-reserve organizations are allowed to operate. In return, peoples' deposits are backed by the government up to $250k (in the US).
Ponzi schemes ignore regulations and laws, and their customers' deposits are not insured or backed by any organization.
The laws that banks are forced to follow may be woefully insufficient, but the government is incentivized to prevent serious collapses because they would be on the hook for a lot of money. Retail customers are also less likely to start a run if they trust that someone will be there ready to hand over their cash when the dust settles.
Banks are forced to abide by regulations and laws dictating how fractional-reserve organizations are allowed to operate. In return, peoples' deposits are backed by the government up to $250k (in the US).
Ponzi schemes ignore regulations and laws, and their customers' deposits are not insured or backed by any organization.
The laws that banks are forced to follow may be woefully insufficient, but the government is incentivized to prevent serious collapses because they would be on the hook for a lot of money. Retail customers are also less likely to start a run if they trust that someone will be there ready to hand over their cash when the dust settles.
> Banks are forced to abide by regulations and laws dictating how fractional-reserve organizations are allowed to operate. In return, peoples' deposits are backed by the government up to $250k (in the US).
Depositors also have first claim against assets in insolvency, so even uninsured accounts will be paid back before bondholders or equity owners. Even a well-intentioned crypto security has no such strict prioritization.
Depositors also have first claim against assets in insolvency, so even uninsured accounts will be paid back before bondholders or equity owners. Even a well-intentioned crypto security has no such strict prioritization.
250k is per entity, per bank — perfectly legal to use multiple banks and banks publicly offer this as a service to businesses and high net worth individuals.
Example: https://www.sec.gov/oiea/investor-alerts-bulletins/ib_banksw...
Example: https://www.sec.gov/oiea/investor-alerts-bulletins/ib_banksw...
> Please explain to me the difference between a bank and a Ponzi Scheme.
The story of the 3 little pigs comes to mind. "The first pig made his house out of straw...".
The story of the 3 little pigs comes to mind. "The first pig made his house out of straw...".
jtode(1)
My biggest takeaway right now is to study the crypto firms and projects that are having trouble as a way to abstract what red flags to look for.
For example, with Terra the abstraction was that pegs don't work as we've seen many a time, especially when Soros broke the BoE. I took a small bath with my Terra holding and life goes on. I can do that because I didn't use leverage, I can lose everything I put into crypto, and I diversified my crypto portfolio. Moving forward I'm staying away from projects with a "stable coin" component as I don't think the fundamentals work.
If anyone has come across an analysis framework for other crypto projects please let me know.
For example, with Terra the abstraction was that pegs don't work as we've seen many a time, especially when Soros broke the BoE. I took a small bath with my Terra holding and life goes on. I can do that because I didn't use leverage, I can lose everything I put into crypto, and I diversified my crypto portfolio. Moving forward I'm staying away from projects with a "stable coin" component as I don't think the fundamentals work.
If anyone has come across an analysis framework for other crypto projects please let me know.
I do have a great analysis framework for crypto projects:
"is crypto project?" -> "stay away"Sure I get that, but I'm old enough to remember the .com crash carnage and people saying that the web was a total waste of time etc and look how wrong they were.
I think that the future is a probability distribution, and there is a non-zero probability that crypto doesn't die but keeps growing. Therefore, I'm not all in, but I'm not all out.
I think that the future is a probability distribution, and there is a non-zero probability that crypto doesn't die but keeps growing. Therefore, I'm not all in, but I'm not all out.
Old enough to remember that, but not old enough to remember have been times that it turned out everything was a fraud or scam. It sometimes turns out an entire industry/etc has no clothes. :)
If your goal is "avoid frauds/scams", then the framework you were given works for sure (of course, it trivially works for anything).
If your goal is "make money", then investing in frauds/scams can in fact be quite profitable and then you are a bit stuck.
If your goal is "make money while avoiding anything that appears to be fraud/scam", then, honestly, at this point, i think that brings you back to "avoid crypto projects".
While there are obvious scams/fraud, there is also much higher than normal probability (relative to regulated stock markets, etc) that anything you choose is scam whether it looks okay or not.
Remember that one of the fundamental reasons that regulated markets exist is to be able to tell (with high probability) what is a fraud/scam not due to required disclosures, etc This is because otherwise it can be remarkably hard to tell anything but the obvious scams.
Since crypto is a non-regulated market, finding/identifying scams is, by definition, a crapshoot. The only ones you will identify are the ones that are obvious scams.
If your goal is "avoid frauds/scams", then the framework you were given works for sure (of course, it trivially works for anything).
If your goal is "make money", then investing in frauds/scams can in fact be quite profitable and then you are a bit stuck.
If your goal is "make money while avoiding anything that appears to be fraud/scam", then, honestly, at this point, i think that brings you back to "avoid crypto projects".
While there are obvious scams/fraud, there is also much higher than normal probability (relative to regulated stock markets, etc) that anything you choose is scam whether it looks okay or not.
Remember that one of the fundamental reasons that regulated markets exist is to be able to tell (with high probability) what is a fraud/scam not due to required disclosures, etc This is because otherwise it can be remarkably hard to tell anything but the obvious scams.
Since crypto is a non-regulated market, finding/identifying scams is, by definition, a crapshoot. The only ones you will identify are the ones that are obvious scams.
I was there too and basically nobody said that. Crypto being "like the early internet" and "people said that the web was a waste of time too!" are the biggest crypto lies ever told and repeated. Absolute whoppers.
I exaggerate, but in the run up neighbours were telling everyone to just buy Microsoft, and everyone tech adjacent I knew was trying to make an e-commerce website. I was just graduating out of university and web dev jobs evaporated. Many e-commerce companies went bust, or were acquired (my gf at the time experienced layoff after layoff until she went). At that time everyone I knew was not thinking about doing anything web related.
Probably the smart money knew that the builders who kept going had a chance to run up when the market came back on the excitement of what they built, but my social circle were not privy to those conversations.
Probably the smart money knew that the builders who kept going had a chance to run up when the market came back on the excitement of what they built, but my social circle were not privy to those conversations.
>> neighbours were telling everyone to just buy Microsoft
Healthy dividends and massive growth; you should have listened to them!
Healthy dividends and massive growth; you should have listened to them!
Seems peoples perspectives are different, who would have thought?
Personally, I was working with computers back then too, and most people who also didn't work with computers at that point always asked me "When are you gonna get a real job?" and told me "the Internet is just a fad".
But again, your experience could very well have been different.
Personally, I was working with computers back then too, and most people who also didn't work with computers at that point always asked me "When are you gonna get a real job?" and told me "the Internet is just a fad".
But again, your experience could very well have been different.
There were definitely a lot of people saying that, usually after losing a lot of money with crazy investments that 'could not fail'. On actual 9/11 (that's why I remember it very well; during the meeting the CEO's secretary came in and told about a large attack on the US), I was at a large Dutch client of ours who said they will cancel all internet projects and move back to Windows only software. The CEO had lost millions listening to his accountants and investing in World Online [0] and had no faith anymore this 'web thing' would go anywhere. A large insurer who also was our client, scrapped the webbased employee benefits project they started in 1999 in favour of a Windows client.
[0] https://en.wikipedia.org/wiki/World_Online#Post_IPO
[0] https://en.wikipedia.org/wiki/World_Online#Post_IPO
I was there too and clearly remember two things:
First. "Web dev" positions evaporated & I actually took a "stable" job at a university vs. staying at the failing internet investment firm I was working for as a developer. For a while tech was definitely "uncool", especially to those who were in it for the get-rich-quick angle. I hope the same will happen to crypto: an exodus of the scamsters.
Second. I remember thinking "so much potential destroyed by those damn suits" ... micropayments, banner ads, Ecommerce, online auctions, peer-to-peer file sharing' encrypted email, shopping bots ... we had all this wonderful tech but none of it came to fruition because of the inflated expectations / greed.
The greed of the dot-com bubble set tech back for about a decade & I expect something similar will happen now with crypto. Maybe we will finally have the breathing room to do something cool with the tech?
First. "Web dev" positions evaporated & I actually took a "stable" job at a university vs. staying at the failing internet investment firm I was working for as a developer. For a while tech was definitely "uncool", especially to those who were in it for the get-rich-quick angle. I hope the same will happen to crypto: an exodus of the scamsters.
Second. I remember thinking "so much potential destroyed by those damn suits" ... micropayments, banner ads, Ecommerce, online auctions, peer-to-peer file sharing' encrypted email, shopping bots ... we had all this wonderful tech but none of it came to fruition because of the inflated expectations / greed.
The greed of the dot-com bubble set tech back for about a decade & I expect something similar will happen now with crypto. Maybe we will finally have the breathing room to do something cool with the tech?
The internet had obvious and wide ranging use cases that were immediately apparent to everyone. Blockchain tech has at best a series of edge case applications for record keeping. I don't think they are comparable at all.
> The internet had obvious and wide ranging use cases that were immediately apparent to everyone
In hindsight it might seem so, but it really wasn't. Most people who didn't already see these "wide ranging use cases" thought the internet was mostly about shady stuff.
In hindsight it might seem so, but it really wasn't. Most people who didn't already see these "wide ranging use cases" thought the internet was mostly about shady stuff.
You can keep telling yourself this to convince yourself that crypto will be as big as the Internet someday, but it is absolutely not the case.
Sure, there were some old fogies (actual advanced age not required, but common) who thought in ~2000 that the Internet was nothing but a passing fad, but anyone with actual sense—including many, many people who were not at all financially invested in tech companies—could see that there was plenty of real substance there, however overly-inflated some valuations were at the time.
By 2000, we already had, very firmly-established, companies like Amazon and eBay, that were clearly worthwhile Internet marketplaces making it vastly easier to buy & sell things.
In 2022, the most "firmly-established" things we have in the blockchain landscape are the cryptocurrencies like Bitcoin, whose sole purpose is to be a different kind of money and/or speculative vehicle. Effectively the only people pushing these things are the ones who stand to lose lots of money when they finish crashing.
Sure, there were some old fogies (actual advanced age not required, but common) who thought in ~2000 that the Internet was nothing but a passing fad, but anyone with actual sense—including many, many people who were not at all financially invested in tech companies—could see that there was plenty of real substance there, however overly-inflated some valuations were at the time.
By 2000, we already had, very firmly-established, companies like Amazon and eBay, that were clearly worthwhile Internet marketplaces making it vastly easier to buy & sell things.
In 2022, the most "firmly-established" things we have in the blockchain landscape are the cryptocurrencies like Bitcoin, whose sole purpose is to be a different kind of money and/or speculative vehicle. Effectively the only people pushing these things are the ones who stand to lose lots of money when they finish crashing.
> You can keep telling yourself this to convince yourself that crypto will be as big as the Internet someday, but it is absolutely not the case.
I own zero cryptocurrencies and would rather see the entire ecosystem crash down just to bring the people behind it back to reality. I'm just writing about my experience from the perspective of someone who experienced the "beginning of the internet as mainstream media" for the ones who didn't.
I own zero cryptocurrencies and would rather see the entire ecosystem crash down just to bring the people behind it back to reality. I'm just writing about my experience from the perspective of someone who experienced the "beginning of the internet as mainstream media" for the ones who didn't.
I was definitely there, as were a bunch of the rest of us. Your experiences are not universal.
I was young at the time, but this doesn't match my recollection. Everybody thought businesses whose value was measured in "eyeballs" were scams, but the internet was well established in industry, government, and academia.
Yahoo and Amazon didn't look fundamentally different from Pets.com to me at the time, but they managed to survive.
Yahoo and Amazon didn't look fundamentally different from Pets.com to me at the time, but they managed to survive.
I think we're probably disagreeing on "immediate", I was thinking by the time of the late 90's. You're right, it would have been less obvious when it was a pile of universities communicating together. But regardless, by the time of the dotcom crash my family in rural Northern Alberta had the internet.
The thing is that those are not crypto projects.
They are just traditional wall street finance pretending to be crypto, just by saying they make money in crypto space.
They are just traditional wall street finance pretending to be crypto, just by saying they make money in crypto space.
I think its better to rip the bandaid off using this approach rather than suffer through another few years of these scams and trash. Just declare this whole crypto thing as a failed experiment and move on.
Terra was no stable coin. It was pointed out constantly that it can't work as an algorithmic stable coin. But the shill army was strong.
There's an even easier metric for measuring crypto project. The bigger and dumber the shill army the more shady the project.
There's an even easier metric for measuring crypto project. The bigger and dumber the shill army the more shady the project.
Thanks for your comment. Any chance you could please point me to the sources that constantly pointed out it wouldn't work?
Besides Reddit, Crypto Twitter was very vocal.
So vocal in fact that the man himself was quite annoyed to constantly being told that UST can't be stable: https://twitter.com/stablekwon/status/1462063962506338318
Do Kwon in general was a red flag. There are a lot of strong opinioned and self confident people in crypto. But when the representative of the crypto project is a toxic participant of the space, you should think really hard about putting your money into such a project.
For example: https://twitter.com/stablekwon/status/1396735774737928192 (note, this tweet was after the whole disaster, losing billions weren't a humbling experience for him).
If you decide to put money into crypto you need to do your own risk management. I especially look how dissenting voices are treated.
A good starting point is Eric Wall https://twitter.com/ercwl. He's not a maximalist of any coins and as such is often very critical of projects and gets a lot of flak for this even though he usually has a thorough explanation how he gets to his conclusions.
So vocal in fact that the man himself was quite annoyed to constantly being told that UST can't be stable: https://twitter.com/stablekwon/status/1462063962506338318
Do Kwon in general was a red flag. There are a lot of strong opinioned and self confident people in crypto. But when the representative of the crypto project is a toxic participant of the space, you should think really hard about putting your money into such a project.
For example: https://twitter.com/stablekwon/status/1396735774737928192 (note, this tweet was after the whole disaster, losing billions weren't a humbling experience for him).
If you decide to put money into crypto you need to do your own risk management. I especially look how dissenting voices are treated.
A good starting point is Eric Wall https://twitter.com/ercwl. He's not a maximalist of any coins and as such is often very critical of projects and gets a lot of flak for this even though he usually has a thorough explanation how he gets to his conclusions.
If you're looking for a place with a community you can ask about those things I recommend, /r/ethfinance. I decided against using Celsius after asking around about it there. There's also been good discussion about what makes a good stablecoin over the years. Hint: Stables like DAI are a completely different thing from what Terra was.
Thanks. I also evaluated Celsius (and others) but decided that I couldn't determine counterparty risk after reading their terms and conditions. In the end I stayed away because of that.
Another fantastic metric: compare the returns for storing or staking your crypto with them to the current sovereign interest rates.
Is it offering Argentina/Turkey returns? Then they're probably the Argentina and Turkey of crypto.
Is it offering Argentina/Turkey returns? Then they're probably the Argentina and Turkey of crypto.
Rate of return is a remarkably good metric for identifying scams.
If they offer more than ~12.5%, run away. Avast, ye salty dogs: a piece o' eight ain't worth losing yer shirt over.
If they offer more than ~12.5%, run away. Avast, ye salty dogs: a piece o' eight ain't worth losing yer shirt over.
IMO your number is still too high
My actual red-flag point was closer to 8-9% pre-inflation. But that is less amenable to pirate jokes, and you can get I-bonds approaching 10% from the government now.
> Moving forward I'm staying away from projects with a "stable coin" component as I don't think the fundamentals work.
Not all stable-coins are the same. Out of all of them USDC seems to be the strongest out of the rest of them and is more likely to survive in the long term out of the others.
That does not mean you should put your whole savings into it. It is still very early for stable-coins. I would rather wait for regulatory clarity to define a set of rules that will wipe all the meme-coins, tokens, copy-paste projects and any crypto project that doesn't fit the incoming regulatory framework for crypto and only then will stable-coins like USDC will improve.
Regulations for crypto is inevitable and is only going to make some coins that are compliant stay for much longer and separate the non-compliant ones into obscurity or non-existence.
Not all stable-coins are the same. Out of all of them USDC seems to be the strongest out of the rest of them and is more likely to survive in the long term out of the others.
That does not mean you should put your whole savings into it. It is still very early for stable-coins. I would rather wait for regulatory clarity to define a set of rules that will wipe all the meme-coins, tokens, copy-paste projects and any crypto project that doesn't fit the incoming regulatory framework for crypto and only then will stable-coins like USDC will improve.
Regulations for crypto is inevitable and is only going to make some coins that are compliant stay for much longer and separate the non-compliant ones into obscurity or non-existence.
I kind of agree, but at the risk of being completely wrong, I think in the future central banks, or global financial institutions backed by central banks, are probably going to be the issuers of stable coins.
...And then we're back to fiat currency again.
Yes. No single cryptocurrency replacing and taking over the entire financial system or a complete destruction of all cryptocurrencies.
Instead having both a co-existence of stablecoins like USDC on multiple blockchain technologies and CBDCs operating on the same form of blockchain and DLT.
Only the blockchains that fit those requirements of ISO 20020 will indeed continue to survive. A disappointing and upsetting result for both the absolutist crypto-maximalists and the absolutist anti-crypto crowd.
Instead having both a co-existence of stablecoins like USDC on multiple blockchain technologies and CBDCs operating on the same form of blockchain and DLT.
Only the blockchains that fit those requirements of ISO 20020 will indeed continue to survive. A disappointing and upsetting result for both the absolutist crypto-maximalists and the absolutist anti-crypto crowd.
So, they just declared technical bankruptcy?
https://www.investopedia.com/terms/t/technicalbankruptcy.asp
https://www.investopedia.com/terms/t/technicalbankruptcy.asp
Not all of these crypto projects will survive. When the tide lowers, we will be seeing who is swimming naked and it looks like these DeFi projects have been caught after the hype has died with the market sentiment turning bearish for crypto in general.
The ones that will survive this crypto crash are probably going to be around for much longer, especially most cryptocurrency coins and blockchains (and not the ERC-20 tokens)
The ones that will survive this crypto crash are probably going to be around for much longer, especially most cryptocurrency coins and blockchains (and not the ERC-20 tokens)
DeFi projects are doing just fine and work as expected. All these news are about centralized finance companies being irresponsible if not outright malevolent
Still Ponzi schemes, but yes they probably will continue unabated.
So companies like Checkout.com, Stripe, etc using a cryptocurrency in their crypto product means that they are also part of the so called 'Ponzi scheme' and they are currently out there scamming?
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Yes. Or at least they're exploiting the situation.
This right here.
They want that sweet Ponzi-adjacent money.
All the receipts, none of the liability*.
(*they hope).
They want that sweet Ponzi-adjacent money.
All the receipts, none of the liability*.
(*they hope).
oH nO. SoMEoNE pLEaSe SToP tHeM /s
That means Stripe, Checkout.com, etc are somehow now 'scammers' and by using crypto, they have found a legitimate use case for it. If they are scamming, Where is the scam?
So now people using Stripe's products and using their crypto offering are now facilitating in the so called 'scam'. Does that mean they should close down their Stripe or Checkout.com accounts to stop the so-called scam that Stripe and Checkout.com are involved in?
That means Stripe, Checkout.com, etc are somehow now 'scammers' and by using crypto, they have found a legitimate use case for it. If they are scamming, Where is the scam?
So now people using Stripe's products and using their crypto offering are now facilitating in the so called 'scam'. Does that mean they should close down their Stripe or Checkout.com accounts to stop the so-called scam that Stripe and Checkout.com are involved in?
Well its a business predicated on btc going up, in bear market you literally incentivize people to take up as much debt in btc as possible to repay it for pennies on dollar.
Babel Finance is not DeFi.
Wait until Tether goes... wait until Tether goes...
I personally enjoy regulated banking very much :-)
With boring central banks and banks that are heavily stress-tested and regulated.
"Seeking Certainty in Uncertainty"
Definitely think that their homepage slogan needs an update after this.
Definitely think that their homepage slogan needs an update after this.
The music is about to stop!
No, it already did - we're seeing the effects of it now though. The speed it cascades thru though is second.
One bitcoin is still worth $20,000+. Still a ways to go before the music stops.
Just like it has for every previous crypto bull market. The casinos will be back in another 3 years.
Exactly, there's a whole generation of people too young to get ripped off yet that will be around in 3 years to throw their student loans in the toilet.
> to throw their student loans in the toilet
If it's a student loan its already in the toilet.
If it's a student loan its already in the toilet.
Hopefully enough normies lose their life savings that they’ll demand government regulation.
It seems the music stopped already
Question for the crypto skeptics of HN. Do you think this cycle the whole crypto space goes down the drain never to be heard of again? Do you think the whole space is a fad or do you think there are patches of values underneath the froth? How do you see the space evolving? Thanks!
There will always be new victims ready to hear "this time is different".
Let me just see if we can validate this comment ...
People bought luna 2.0 within days of the collapse of luna 1.0 - check
People bought luna 2.0 within days of the collapse of luna 1.0 - check
Its wa quite sad actually. I like the blockchain technology and its properties. I like things like hyperledgrler and the like.
But at the same time it's disgusting the current state of the crypto wars. All that is happening is due to greed. People are greedy, crypto "companies " are greedy and everyone wants to become rich without effort. There are VERY few projects that really want to develop technology. And those are also hijacked by greedy people to play as casinos.
I really wish the crypto space would crash and burn, BTC to hobdown to $100 and similar, so that all that noise goes out, and people go back to scam penny stocks or Amway, and leave the development of blockchain technology alone.
I remember when Wikileaks started accepting bitcoin. Satoshi very well mentioned that it was not ready. I am sure he was surprised by the craziness that came of it. Becoming exactly the thing that it was supposed to fight against.
But at the same time it's disgusting the current state of the crypto wars. All that is happening is due to greed. People are greedy, crypto "companies " are greedy and everyone wants to become rich without effort. There are VERY few projects that really want to develop technology. And those are also hijacked by greedy people to play as casinos.
I really wish the crypto space would crash and burn, BTC to hobdown to $100 and similar, so that all that noise goes out, and people go back to scam penny stocks or Amway, and leave the development of blockchain technology alone.
I remember when Wikileaks started accepting bitcoin. Satoshi very well mentioned that it was not ready. I am sure he was surprised by the craziness that came of it. Becoming exactly the thing that it was supposed to fight against.
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I think a similar thing as with the ICO boom will happen: The current mechanisms of fraud (ICOs) will become regulated, so the industry will move on and create new ones (NFTs, DeFi/"yield"). This cycle will continue until the SEC stops listening to smoothtalking lobbyists fearmongering about the SEC blocking "important innovation" and decides to fully pull cryptocurrency into the banking regulatory framework. At that point, lacking the ability to do things that are illegal to do for good reasons, cryptocurrency becomes pretty irrelevant.
I believe we're seeing the end of "retail crypto." Just like agricultural futures, crypto will continue to exist but will mostly be known outside of institutional trading as a good way to lose your shirt.
As far as underlying value goes: one thing we've learned from the constant scamming is that a protocol designed for trustless interactions will inevitably devolve into purely adversial interactions. Consider it a social application of Gresham's law. Central banks, multinational corporations, and others who can marshal the resources to perform extensive audits will probably use smart contracts on a proof-of-stake chain for large, adversarial transactions that occur outside of any one nation's jurisdiction. Everything else will continue to be based on trust, just like it always has been.
As far as underlying value goes: one thing we've learned from the constant scamming is that a protocol designed for trustless interactions will inevitably devolve into purely adversial interactions. Consider it a social application of Gresham's law. Central banks, multinational corporations, and others who can marshal the resources to perform extensive audits will probably use smart contracts on a proof-of-stake chain for large, adversarial transactions that occur outside of any one nation's jurisdiction. Everything else will continue to be based on trust, just like it always has been.
>Central banks, multinational corporations, and others who can afford to marshal the resources to perform extensive audits will probably use smart contracts on a proof-of-stake chain for large, adversarial transactions
Arbitration at the highest echelons of power is done with weapons. I don’t give a shit about what your blockchain says when I can force you to the negotiating table Commodore Perry style.
Arbitration at the highest echelons of power is done with weapons. I don’t give a shit about what your blockchain says when I can force you to the negotiating table Commodore Perry style.
> Arbitration at the highest echelons of power is done with weapons
True, there is an implicit threat of violence when parties interact at that level. But there is also a hope on both sides that if all the rules are followed, violence will not be necessary even if one party gets the better of the other. E.g., the central banks of unfriendly nations transact with one another according to international norms and rules, even though either side could escalate to "kinetic" reprisals. The force of norms and rules is strongest between parties with balanced power (otherwise the stronger side can just pull a Commodore Perry like you say).
True, there is an implicit threat of violence when parties interact at that level. But there is also a hope on both sides that if all the rules are followed, violence will not be necessary even if one party gets the better of the other. E.g., the central banks of unfriendly nations transact with one another according to international norms and rules, even though either side could escalate to "kinetic" reprisals. The force of norms and rules is strongest between parties with balanced power (otherwise the stronger side can just pull a Commodore Perry like you say).
> Do you think this cycle the whole crypto space goes down the drain never to be heard of again?
No. The crypto/scam space will be back because people love to gamble and love the concept of easy money.
> Do you think the whole space is a fad or do you think there are patches of values underneath the froth?
There is crypto/scam space and there is Bitcoin/Monero space. The actual decentralized cryptocurrencies are widely used where fiat system fails, like on DNMs.
No. The crypto/scam space will be back because people love to gamble and love the concept of easy money.
> Do you think the whole space is a fad or do you think there are patches of values underneath the froth?
There is crypto/scam space and there is Bitcoin/Monero space. The actual decentralized cryptocurrencies are widely used where fiat system fails, like on DNMs.
I think basically the whole space is a fad, but fads don't usually disappear entirely. Beanie babies were a fad; they are no longer a fad; this doesn't seem to affect my niece's enjoyment of the beanie baby we bought for her last year.
My approach is to stay away until the fad dies, and then look to see if any part of it is useful to me. The last time I made a serious evaluation of something in that space was Bitcoin; it didn't serve any use case I had; but maybe there's been some innovation in the space that is hard to find behind the fad hype.
My approach is to stay away until the fad dies, and then look to see if any part of it is useful to me. The last time I made a serious evaluation of something in that space was Bitcoin; it didn't serve any use case I had; but maybe there's been some innovation in the space that is hard to find behind the fad hype.
Regardless, I think bitcoin survives. I don't think it has patches of value, but I do think others think that it does.
I think eventually bitcoin fills the same space as "no programming knowledge required coding tools". Every few years it'll spike as this time they know went wrong the last time. And then the inevitable happens.
I think eventually bitcoin fills the same space as "no programming knowledge required coding tools". Every few years it'll spike as this time they know went wrong the last time. And then the inevitable happens.
Unfortunately scammers will always find new suckers for their ventures. People lose money to pyramid selling/MLM scams in real life all the time. Cryptocurrencies just made it possible to recruit suckers on a global scale.
Unless governments step in and ban them, there will always be new crypto scams.
Unless governments step in and ban them, there will always be new crypto scams.
I think it is way too early to discard the underlying technology and I think/hope that parts of the open source ecosystem will survive. Reckless speculation being the current primary use case does not mean there won't be any societally more beneficial use case in the future.
This feels a bit more likely to be the end than previous collapses (last time round, the ecosystem wasn't advanced/broken enough to show the sort of contagion hitting it now). On the other hand, never underestimate the ability of fools to be parted from their money; see NFTs, for instance. It's quite likely that there'll be another crypto-y... thing along sooner or later.
It's notable that classical Ponzi schemes come back in the real world from time to time; they just need a very light reskin, and people buy in again. Plausible that the same happens with crypto to some extent.
It's notable that classical Ponzi schemes come back in the real world from time to time; they just need a very light reskin, and people buy in again. Plausible that the same happens with crypto to some extent.
I think the killer app for crypto (money laundering/buying drugs online) will provide some kind of cushion against going straight to zero. But that is a much smaller cap.
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I'm not a crypto/finance expert, but the current crypto space reminds me of the early US "Free Banking" era. Too many players, wild west, many earners, and many losers. There is a tech & concept value in crypto space, so I don't think it will go down the drain. It will take time to stabilize, just like US banking sector.
Depends entirely on the regulatory framework. Up until now crypto has been largely unregulated. With regulatory I don’t think it will be as volatile/attractive.
I'm as skeptical of crypto as anyone, but I do think of it as an actual innovation of an asset class, and so I have to imagine that it will remain in some form.
> How do you see the space evolving?
Same as MLM/Hype evolved to Crypto/NFT. Some new pyramid will come in place for the next generation.
Same as MLM/Hype evolved to Crypto/NFT. Some new pyramid will come in place for the next generation.
Do I think it will? No; there's always another sucker ready to lose their life savings.
Do I hope this will be the cycle though? Oh absolutely.
Do I hope this will be the cycle though? Oh absolutely.
Blockchain, cryptocurrencies, DAO, etc — are here to stay.
Even with the market as is, today it’s still a trillion dollar industry.
Even with the market as is, today it’s still a trillion dollar industry.
This argument is always very funny to me.
History is rife with hundred-billion dollar industries destroyed in very short periods of time, across multitudes of field types.
For example, i've watched fields created by single legal opinions, grow to many billions, and then get destroyed overnight by a different legal opinion. All in the course of 10-15 years.
The amount of money in it is just not a sufficient condition for it to stick around. It certainly helps, mind you, but there will always be somewhere else to put the trillion dollars.
History is rife with hundred-billion dollar industries destroyed in very short periods of time, across multitudes of field types.
For example, i've watched fields created by single legal opinions, grow to many billions, and then get destroyed overnight by a different legal opinion. All in the course of 10-15 years.
The amount of money in it is just not a sufficient condition for it to stick around. It certainly helps, mind you, but there will always be somewhere else to put the trillion dollars.
Do you actually have specific notable (and comparable) examples of technology based industries that reached relatively the order of magnitude crypto has that were rapidly killed off?
Otherwise, as is, your response to me is without merit.
Otherwise, as is, your response to me is without merit.
Someone gave you one.
Here's another:
Software patents were judicially created in the US by a single fed circuit opinion.
The field wildly expanded to many many many billions of dollars until a single supreme court opinion.
While still kind of alive (mostly legacy lawsuits), the vast majority of the value was rapidly killed off post supreme court decisions (and AIA)
This kind of thing happens all the time - in software, in pharma, in ...
As I said, value helps in some sense, but just because there is a lot of money in a thing simply does not mean it will remain.
FWIW - your comment very much comes off as the typical "crypto folks ignore roughly all history" stereotype that it gets painted with -
While still kind of alive (mostly legacy lawsuits), the vast majority of the value was rapidly killed off post supreme court decisions (and AIA)
This kind of thing happens all the time - in software, in pharma, in ...
As I said, value helps in some sense, but just because there is a lot of money in a thing simply does not mean it will remain.
FWIW - your comment very much comes off as the typical "crypto folks ignore roughly all history" stereotype that it gets painted with -
Billions, even 10s of billions, is not comparable to trillions.
None examples so far have provided independently source of valuing industries claimed, nor to my knowledge have any of the industries cited have as many direct customers.
Feel free to provide specific (and comparable) examples.
To be clear, just trying to be objective. For example, NFTs alone for living artist easily surpassed the billion made in non-NFT sales for living artist; sure NFTs were 30-40% behind in total volume, but that’s largely for dead artists.
Further, you keep bring up legal changes, but I am not aware of any pending legal matters that might have a substantial impact on the use of the technology itself; further, crypto is global and clearly adapted to legal changes including all out bans in China.
None examples so far have provided independently source of valuing industries claimed, nor to my knowledge have any of the industries cited have as many direct customers.
Feel free to provide specific (and comparable) examples.
To be clear, just trying to be objective. For example, NFTs alone for living artist easily surpassed the billion made in non-NFT sales for living artist; sure NFTs were 30-40% behind in total volume, but that’s largely for dead artists.
Further, you keep bring up legal changes, but I am not aware of any pending legal matters that might have a substantial impact on the use of the technology itself; further, crypto is global and clearly adapted to legal changes including all out bans in China.
Hahaha.
So you are combining all of the different types of markets/etc in your case, but not in the case of comparison?
And then just discounting them anyway with no reason why.
Saying "it's not comparable to trillions" is both wrong and useless - it is not a reason, it's an assertion, and one not backed up.
I'm not going to continue this, because you are definitely one of these folks who seem to believe crypto is unique in value and capability, that somehow make it not capable of failing (but can't explain why other than "when you add up all the theoretical money involved in tons of distinct markets and uses that somehow relate to crypto it's a lot"). This is IMHO distinct failure of objectivity and imagination.
The entire stock market failed enough in a single day to wipe entire economic segments out and then continued to die - 2 day loss = 25%, 3 year loss = 89%. Eighty nine percent.
It's so amazingly naive to believe that in the thousands of years of human history that nothing like crypto has happened, that large scale markets on the same order of magnitude of crypto markets have not failed, etc, that i don't even know where to begin. Then going further and just asserting anyone who starts to provide you examples is wrong/incomparable without even a single sentence that backs up why, makes this a pointless conversation.
You don't want to understand, you want to win.
Have a good one.
I'm not going to continue this, because you are definitely one of these folks who seem to believe crypto is unique in value and capability, that somehow make it not capable of failing (but can't explain why other than "when you add up all the theoretical money involved in tons of distinct markets and uses that somehow relate to crypto it's a lot"). This is IMHO distinct failure of objectivity and imagination.
The entire stock market failed enough in a single day to wipe entire economic segments out and then continued to die - 2 day loss = 25%, 3 year loss = 89%. Eighty nine percent.
It's so amazingly naive to believe that in the thousands of years of human history that nothing like crypto has happened, that large scale markets on the same order of magnitude of crypto markets have not failed, etc, that i don't even know where to begin. Then going further and just asserting anyone who starts to provide you examples is wrong/incomparable without even a single sentence that backs up why, makes this a pointless conversation.
You don't want to understand, you want to win.
Have a good one.
Neither fan or hater of crypto space based technology; said as much prior, but appears you’re not reading my replies.
Further, you clearly did read the OP comment, which said the “whole crypto space” — so no, I don’t believe me responding to that as the scope is off-topic, changing the scope, etc.; I didn’t even include cryptography, which is obviously part of the space, worth $10 of trillion and used 7.26 Billion or making up 91.54% of the world's population; every phone uses cryptography.
Next, lol, money is obviously real, claim it’s not is funny at best, not even worth responding too; obviously not worth the 10s of trillions the public equity market is worth, but again, no example you’ve supplied came close to even 10 billion; reminder that trillion divided by billion is 1000, even at 100 billion, that still 10x larger; even at 10 billion, that would be like comparing industry making $1 a year to one that makes $100.
No idea what the whole 89% of the stock market point means; either literally, or as it relates to the topic.
Cheers.
Further, you clearly did read the OP comment, which said the “whole crypto space” — so no, I don’t believe me responding to that as the scope is off-topic, changing the scope, etc.; I didn’t even include cryptography, which is obviously part of the space, worth $10 of trillion and used 7.26 Billion or making up 91.54% of the world's population; every phone uses cryptography.
Next, lol, money is obviously real, claim it’s not is funny at best, not even worth responding too; obviously not worth the 10s of trillions the public equity market is worth, but again, no example you’ve supplied came close to even 10 billion; reminder that trillion divided by billion is 1000, even at 100 billion, that still 10x larger; even at 10 billion, that would be like comparing industry making $1 a year to one that makes $100.
No idea what the whole 89% of the stock market point means; either literally, or as it relates to the topic.
Cheers.
Don't see what technology has to do with it. All sorts of weird financial instruments are created, grow enormous, and then either are banned, or scare people enough that everyone stops using them.
From OP comment, “ Do you think this cycle the whole crypto space goes down the drain never to be heard of again?”
Obviously the tech is part of the “whole space” and not a fade; didn’t even bring up encryption, which is the fundamental core of crypto. Sure encryption might be ban, but if you think governments will apply that to themselves, that’s obviously not a common or reasonable position.
Obviously the tech is part of the “whole space” and not a fade; didn’t even bring up encryption, which is the fundamental core of crypto. Sure encryption might be ban, but if you think governments will apply that to themselves, that’s obviously not a common or reasonable position.
There were billions of dollars funding work on paid network traffic prioritization in the 90s and early 2000s. Then the whole field was banned in 2005, and it evaporated. The ban was lifted in 2008, then reapplied, then lifted again in 2014, then reapplied in 2015, then lifted again. Vast amounts of money flowed into and out of the sector at each reversal.
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I found it amusing that this notice says "Due to the current situation, Babel Finance is facing unusual liquidity pressures" and their homepage says "Seeking Certainty in Uncertainty".
Naming your company after a failed experiment is also an ironic choice.
What’s next… Icarus Investments?
What’s next… Icarus Investments?
> Icarus Investments
High efficiency, high energy solar solutions using phase change in solid hydrocarbons for energy capture.
High efficiency, high energy solar solutions using phase change in solid hydrocarbons for energy capture.
Until I learned about the mechanics of it, I thought it would be a glorious idea to have e.g. metal rods placed in the Sahara that would contract at night and expand at day (due to the high temperature differences) and extract energy from the movement. Counter to young me's expectations, thermal expansion is not some infinite force, and if you run the real physics, the low frequency makes it not worth the material investment (power produced scales linearly with the volume of metal). Not to mention that the Sahara is not exactly the juiciest market for selling power.
A similar idea with phase changing wax (iirc that's more or less how the temperature regulator in your shower works) is probably just as physically sound and just as economically doomed.
A similar idea with phase changing wax (iirc that's more or less how the temperature regulator in your shower works) is probably just as physically sound and just as economically doomed.
Just because an idea is unsound, impractical, and useless is no reason not to fund raise on it. See also SpinLaunch and quantum computing companies.
And the wax thing can work, you just need wax that's energetic enough to count as an explosive. I haven't worked out the recovery phase yet, granted; but with a few billion dollars I'm sure it can be made to work.
And the wax thing can work, you just need wax that's energetic enough to count as an explosive. I haven't worked out the recovery phase yet, granted; but with a few billion dollars I'm sure it can be made to work.
Well I’ve lost track of how many hedge funds Thiel has run into the ground, but I think the first was “Mithril”, which didn’t work out great for the dwarves.
Perhaps inevitably:
https://www.icarusinvestmentgroup.com/
https://www.icarusinvestmentgroup.com/
FoolMeOnce Holdings?
Sharkbait holdings
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That's what you get in a zero-interest rate environment with no industrial policy. Building physical infrastructure would cost real-world money and cut into profits, hence what you end up with is virtual casinos.
No one is better off with that. At least in the runup to 2008 there was housing built speculatively, but since then there has been no productive investment at all.
No one is better off with that. At least in the runup to 2008 there was housing built speculatively, but since then there has been no productive investment at all.
> That's what you get in a zero-interest rate environment with no industrial policy.
There was a complete lack of any kind of policy in almost all major Western countries. Since the competitive pressure of the USSR fell away, Western politics have stagnated - keep the economy as-is, maybe lower corporate taxes and privatize government services. The only thing where a bit of progress happened in politics were social equality issues (gay marriage, access to abortions) and that's it.
But no government really thought about what digitalization would bring, how to regulate it to prevent the rise of new exploitation models (gig workers) or speculative bubbles (dotcom bubble, the current shitcoin collapse), or how the economy should transform to the new possibilities and realities.
The result is - we've seen it all - not pretty... the economy clearly wants directions from politics where it should go (particularly in the automotive industry), and a ton of money was blasted into cryptocurrencies, NFTs and other scams simply because there was no direction where money should go instead. If one wants to boil it down, I'd call it "this is what happens when the free market takes ultimate control over everything".
There was a complete lack of any kind of policy in almost all major Western countries. Since the competitive pressure of the USSR fell away, Western politics have stagnated - keep the economy as-is, maybe lower corporate taxes and privatize government services. The only thing where a bit of progress happened in politics were social equality issues (gay marriage, access to abortions) and that's it.
But no government really thought about what digitalization would bring, how to regulate it to prevent the rise of new exploitation models (gig workers) or speculative bubbles (dotcom bubble, the current shitcoin collapse), or how the economy should transform to the new possibilities and realities.
The result is - we've seen it all - not pretty... the economy clearly wants directions from politics where it should go (particularly in the automotive industry), and a ton of money was blasted into cryptocurrencies, NFTs and other scams simply because there was no direction where money should go instead. If one wants to boil it down, I'd call it "this is what happens when the free market takes ultimate control over everything".
> There was a complete lack of any kind of policy in almost all major Western countries.
Since planned economy doesnt work, then clearly we shouldnt do planning of any kind at all
Since planned economy doesnt work, then clearly we shouldnt do planning of any kind at all
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Maybe a good thing that companies in that space are going down. Clears the way for more decentralization.
This is sarcasm, right?
Why sarcasm?
Centralized crypto "banking" institutions are the worst of both worlds. You are giving away your money to someone else, and there are no regulations to protect you from being screwed over by them.
With DeFi (decentralized finance) you have transparency over what the smart contract does.
(Of course you have to be careful because a lot of things claim to be decentralized but are actually centralized)
Centralized crypto "banking" institutions are the worst of both worlds. You are giving away your money to someone else, and there are no regulations to protect you from being screwed over by them.
With DeFi (decentralized finance) you have transparency over what the smart contract does.
(Of course you have to be careful because a lot of things claim to be decentralized but are actually centralized)
> With DeFi (decentralized finance) you have transparency over what the smart contract does.
No, you don't. People find subtle bugs in open source code all the time, some of them disastrous. Unintentional bugs in smart contracts have lost tens of millions of dollars multiple times; imagine what you could accomplish with intentional holes.
Parity lost $280M alone. https://www.cnbc.com/2017/11/08/accidental-bug-may-have-froz...
No, you don't. People find subtle bugs in open source code all the time, some of them disastrous. Unintentional bugs in smart contracts have lost tens of millions of dollars multiple times; imagine what you could accomplish with intentional holes.
Parity lost $280M alone. https://www.cnbc.com/2017/11/08/accidental-bug-may-have-froz...
Thats a major problem, but it's a different problem to the one OP is talking about - some shady guy taking or misusing your money on a whim
What if said shady guy wrote a subtle bug into the contract intentionally?
Has this ever happened or its just a hypothetical?
It seems that the remaining players will get larger leading to more centralization.
How come?
There are many people in crypto who aren't fond of companies like Coinbase or OpenSea.
The helped to make things a bit more mainstream, but they aren't paragons of decentralization.
There are many people in crypto who aren't fond of companies like Coinbase or OpenSea.
The helped to make things a bit more mainstream, but they aren't paragons of decentralization.
Yeah, but de-fi had already been done successfully in the early 2000's well before Bitcoin and still didn't pan out in the end.
Done successfully and didn't pan out?!
Exactly!
The infrastructure worked. The concept did exactly what it was supposed to. 100% successful.
.. and yet lending to unreliable borrowers that no-one else wanted was still a stupid idea.
The infrastructure worked. The concept did exactly what it was supposed to. 100% successful.
.. and yet lending to unreliable borrowers that no-one else wanted was still a stupid idea.
“This is great for crypto. All the ponzis are going down and the legit companies are the ones that remain”
Reality: The public trust on crypto erodes more and more when one of these companies goes down. There is no greater fool to make your hodl-ed assets valuable.
Reality: The public trust on crypto erodes more and more when one of these companies goes down. There is no greater fool to make your hodl-ed assets valuable.
Decentralization isn't equivalent to "trust" on crypto.
Quite the opposite actually.
Quite the opposite actually.
Replace "companies" with "projects".
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Interesting choice of name, presumably they were familiar with how the Tower of Babel played out.
The name was too subtle. They needed to add a giant “/s” after it.
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Every generation rediscovers the financial frauds of the past
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They have a couple open “Risk Control Manager” positions. Probably high-priority hires.
https://babel.finance/join-detail.html?id=9
https://babel.finance/join-detail.html?id=9
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kosyblysk666(1)
> Anonymous sources who claim to have inside knowledge allege that Babel Finance has been misusing client funds via highly leveraged transactions and without permission.
(Oh, look, Tether's involved again. How much of the $160M in their claimed "shareholder capital" at https://tether.to/en/transparency has evaporated in the last month? They're currently claiming it hasn't changed by more than $50 since a month ago; https://twitter.com/jjjbtc/status/1524819806892982272)