I don't understand a single thing about this or crypto generally but even I said "seems bad"

[mahatmakanejeeves]

Popehat Retweeted

I don’t understand a single thing about this or crypto generally but even I said “seems bad”

Link to tweet

[rampartc]

1. jeeez i sure hope my 401 k isn't "investing" in this shit..........

[COL Mustard]

2. If you don't understand something, you shouldn't invest in it

Nobody really understands crypto and therefore nobody should be investing in it.

Sure, some people will make money, but most will lose money they probably can’t afford to lose.

Play the lottery instead…it’s safer. Or just send your money to me!

[chriscan64]

3. I don't get it either.

The latest episode of Nova on PBS did a good job of explaining it to the novice. I am still a little puzzled after watching it, but one thing I did learn is that other records that are connected to a ledger are supposed to update on any change. It could be said that this is the prime directive of crypto. Paper money works because if I spend a $20 bill at the store, I lose it and the store gets it. It wouldn't work if I made a Xerox copy of the bill and still had $20 after spending $20.

The notion of having transactions go from entity to entity without passing through a bank or credit card company sounds liberating, but by avoiding these institutions crypto is avoiding regulation by the government which is supposed to be in essence our oversight. At this point in its history, crypto is at the wild west stage.

[bucolic_frolic]

4. Prosperity always has its big scams as shysters ride the delusion to bilk the masses

This is no surprise.

[BadgerKid]

5. Details are still coming in but there's more going on

What Mr Hann doesn’t say but I would suggest is that it appears the existing oversight mechanisms of traditional finance failed or were let to fail.


https://www.linkedin.com/posts/canfxguru_you-need-to-understand-the-ftx-debacle-even-activity-6997040821044736000-aJN7?utm_source=share&utm_medium=member_desktop

[honest.abe]

6. I suspect there are "backdoors" in all of the crypto software.

Scamware.

[D_Master81]

7. This was more on the ceo than crypto

Basically what was happening was people were depositing money on the exchange platform and FTX was turning around and using that money to invest in a company hedge fund also owned by the ceo. Much like an actual bank the exchange didn’t have the money if people all made a rush on the exchange for their money, except banks have fdic insurance. When people came calling for their money all at once it all collapsed and the ceo should go to prison.

[grantcart]

8. It's not a currency. It's not an investment, it's speculation.

Even diamonds and gold have some end use.

These speculative markets have existed for hundreds of years (see Amsterdam Tulip Market) and always have the same end

Price is always determined by supply and demand and in this case there is no limit on supply. Pepsi could decide tomorrow to start another Bitcoin, and another every day.

The value is based on a perceived shortage of supply relative to demand as there is no end use the demand is based on a perception that could (and will) evaporate as the next more improved Bitcoin is issued.

[genxlib]

9. Libertarian types hate that currency is controlled by Governments

So Crypto sounds like a grand idea to them.

The problem is that Crypto is controlled by something. And if you don't know who, how or why, then you are throwing your money in the air without checking the wind.

Same is true of Social Media. They see it as a bad thing that it is controlled by a publicly held company that answers to share holders and government agencies. So their solution is to cheer on making it a private company that doesn't answer to anyone.

Both are crazy. I will take the flawed but transparent over the questionable and opaque any day.