I went from early bitcoin adopter to early bitcoin skeptic and despite missing most of the gains I have no regrets.
During the early days the crypto space was concentrated to small online communities. People were mostly interested about the technology and the talk of price was limited, in the context "mass adoption". Nowadays it's about the price and the memes. Add to that the money laundering, energy waste and these abductions. Too many smart people work on these pointless projects instead of useful tech that benefits society.
Too many smart people work on these pointless projects instead of useful tech that benefits society.
Hindsight is 20/20. In the early days of crypto the promise of decentralized finance outside of the scrutiny of governments and financial institutions was seen as far from pointless. It only went awry when speculators turned up trying to make a profit from an ostensibly useful idea, and they took it so far that the original idea lost all its meaning so the well-meaning folk left.
Bitcoin was invented with a number go up mechanic, and the idea that a single Bitcoin would be immensely valuable were the currency to gain traction was a point of discussion from the start
Fact is it became popular with speculators faster than it did with anybody else, but the hodlers weren't doing anything to stop people from using it to buy pizza.
The capped emission certainly encourages FOMO and speculation. A fixed block reward would still provide scarcity in the long term while strongly discouraging speculation [1].
The surest way to get flamed out of any crypto mailing list was to ask what the effective clearance rate for the coin was, then following it up with how it could be sped up.
Today the bitcoin network is still stuck at ~7 transactions a second.
Which one are you referring to? What do you want to get all the freedom in the world and no effort for running a decentralized node?
Staking blockchains don't require much resources.
After MtGox the trajectory was pretty clear imo. And when Tethers emerged the whole pyramid was exposed for all to see. It's just pure gambling at this point.
I had a similar experience, and also have zero regrets about missing out on gains. The baked-in energy wastage and the scams and memes were a complete turnoff. That's not the way I want to get rich. Similarly I wouldn't invest in an arms manufacturer or a plastic bag company. Money that doesn't align with your values is just bad mojo.
I'm glad you've made peace with your financial loss. It is an important thing not to dwell on the past in order to be able to move forward, a lesson it took me long to internalize myself.
Stablecoins are actually the future of remittances, the problem is which stablecoin is safe and has enough adoption. (When a big or central bank decides to have a stablecoin, things will change a lot)
I work in “traditional” (as in, non crypto) payment systems, and i can tell you that plenty of companies are looking into using cryto rails for complex remmitance routes.
The problem is swift network/correspondent/intermediary banking. When you want to send money abroad to badly connected banks of badly connected countries, you might have a big route chain (multiple times intermediaries), fees can be huge , and settlement can take a long time. For these “small” banks it can be extremely hard to get better banking partners for better network (as in banking not IT) connection (multiple reasons, from price to available business partner, and company bandwith to go with the project)
Stable coins are much simper by comparison, you just need a wallet, and you ate a n a global network with automated settlement. Now whats lacking is standardizing how to send a message “ your crypto X received money from our crypto wallet Y, from our customer with acct number yyy, intended to your customer with acct number xxx”
Still some guys send iso message via swift to semd those intents and then settle via crypto.
This is a non existing problem for intra-eu payments due to all eu members being part of TARGET settlement system, and there are pan-EU clearing systems, but as soon as you get to more “disconnected “ countries, or “smaller” banks cross continent, it’s a pain.
> The problem is swift network/correspondent/intermediary banking. When you want to send money abroad to badly connected banks of badly connected countries, you might have a big route chain (multiple times intermediaries), fees can be huge , and settlement can take a long time.
But why is this complicated? Isn't it mostly about regulations / KYC / AML, rather than anything technical?
Stablecoins are much simpler because they don't do anything with respect to regulations, they're just a dumb ledger. For those who don't want to bypass regulations and the legal system, stablecoins bring as much as yet another database / ledger, which are not the problem in the first place.
memecoins have nothing to do with BTC. Talk about the price was always a thing because BTC is a currency, thus price is key. The tech is good, or it was at the time.
I don't see the case for money laundering in BTC, only one could be XMR and mixers in ETH. Apart from that, in general cryptocurrency is not good for laundering since the blockchain can be tracked.
Watching how it is working. That the laundering can be tracked is just an expense to the process of recruiting suckers to be the visible parties who eventually do time and don't know about anything but the other visible parties.
"Decentralization" is a generic principle and a very selective choice in this case. What was the specific practical implementation that was so beneficial to society to this day?
Centralization is what enabled today's societies to thrive. So when talking about decentralization you have to get into the specifics to show the value.
Tell third-world countries that centralization is good :)
Centralization could be good, sometimes (if it works idk).
The problem is that the financial world has been monopolized by certain entities and the barrier of entry is enormous. It is never fair to not play by the same rules when regulation favors big institutions, etc... Access to credit is difficult sometimes and unfair. But that is just a reason you could give in the US.
Decentralization ensures that countries that condemn their citizens to raising inflation can access other types of income. Some argentinians get paid in USDC, because their currency is just worthless in other countries, and they would never be able to access USD in their banks.
Decentralization (I have in mind something like Hyperliquid or even BTC) ensures that everybody in the world have access to the same economy without intermediaries asking for a fee. Which means, a person in Indian can access to income the same way a person in the US would. Or you could do a transfer overseas with less fees or regulation problems.
> Decentralization (I have in mind something like Hyperliquid or even BTC) ensures that everybody in the world have access to the same economy without intermediaries asking for a fee. Which means, a person in Indian can access to income the same way a person in the US would.
And do they? In practice? The theory is always sweet, but in practice once you take away "crime" and "hold to sell high" you'll be hard pressed to see too many, or widespread instances of usefulness. You don't make society better by just building a taller peak for a few if at the same time you're digging even deeper troughs for the many.
> Or you could do a transfer overseas with less fees or regulation problems.
Every time someone gets swindled out of their "deregulated, decentralized" money, every time someone loses a finger for their million dollar wallet, you have one more voice asking a centralized organization for protection, maybe with some regulation.
You handwave away all the obvious problems, even though technology or time won't solve any of them. Without protection most people will be screwed out of their belongings. Ask that person in India if they're eager to "access to income the same way a person in the US would" (whatever that means) if this means there's no recourse when they lose the money.
Decentralization benefit society. Trust-less systems - don't. Trust-less systems lead to libertarianism and anarcho capitalism, both are just fancy words for feudalism. We all know how that works, there are even modern day re-enactment which all end up massive fraud and crime. I prefer semi-trusted democracy to the feudalism any time.
I don't see how a trustless & decentralized system would cause feudalism. On the other hand, I see how our current "democratic" system evokes in neo-feudalism. We are all slaves to the government and the few conglomerates they favor, paying taxes to be more restricted. No thanks, I'd rather have a libertarian system and close to 0% tax, if not zero and practically no government.
No, you don't need to worship Amazon in a libertarian system, Amazon lives thanks to regulation (Amazon supports raising the min wage), and other import fees & tax exemptions that smaller businesses can't afford to bypass.
If you think about it deeply, it's still not entirely clear who consumes more energy: the traditional banking sector and servicing of visa, mastercard, etc. cards, or cryptocurrency technologies. At least it seems to me that the difference is not that big.
At least banking I believe if someone went out and said we could save 100 million on energy cost by spending 10 million. They would at least consider doing it, if it looked realistic enough.
On other hand efficiency for BTC mining does not matter. The energy expenditure always approaches the value of mined coins. When efficiency increase same energy is spend just to do more hashes, which are really not useful.
Except that the traditional banking sector does much more than cryptocurrencies do. Bitcoin still runs only around 5-7 transactions per seconds - several orders of magnitude less than Visa alone.
Baffles me how this industry is basically speedrunning through the troubled history of regular finance, and every piece of legislation and every institution has to be rebuilt from scratch even though the mechanisms and the problems are almost exactly the same.
I always found the idea of a free, unregulated financial market being a positive thing amusing. Many of these regulations were made because more or less complex loopholes got exploited and many less wealthy people lost their money. And quite a few of these people with practical experience in these various exploits are still around.
Not sure if people who opted out of security expected to be doused in gasoline. There is something to say about whether this state of no security is generally desirable by society. Everywhere else this happened was eventually regulated.
So thinking crypto will be an outlier is wishful thinking since it will never be allowed to be more powerful than governments. At most, new world orders will be created, but they will settle and be like the old ones, with some new more crypto native rules. They will always know who you ar and who you’re transacting with and where either of you are.
Current crypto fanatics are assuming they will all be part of this club. This road will be filled with poor old men with fewer fingers and lots of regret.
I want crypto to succeed, but I don’t expect it will be unregulated. You’ll pay the same taxes, you’ll go to jail if you try to avoid them or if you send crypto to entities banned by governments. Eventually the things that make crypto so valuable will be hammered out so it’s more like fiat.
Maybe the value will crash or wealthy people of today will find a way to freeze it into reserve currencies (like the newly minted federal crypto reserve), but after some point it will stop being a source of wealth just by holding it at the right time. You will need to exchange it with value you create.
The math of crypto wealth by HODLing is unsustainable.
I've always liked this analogy because it accidentally implies something I believe to be true - the crypto industry will eventually overtake transitional finance while moving at great speed. It says a lot about how bad the traditional finance industry is that this is the easiest path forward that the market found.
> I've always liked this analogy because it accidentally implies something I believe to be true - the crypto industry will eventually overtake transitional finance while moving at great speed.
It isn't implying that. It is implying that it will end up at the same place as the traditional finance.
> It says a lot about how bad the traditional finance
What is so bad about traditional finance that crypto fixes?
"Bad money drives out good" because when they have both, people will prefer paying (getting rid of) the bad while keeping the good for themselves. That has nothing to do with what's happening with cryptocurrency.
Banks are fortified and guarded for a reason. If you have money in bitcoin, it's only as secure as your person and whatever you use to access your crypto assets.
If you had a million in gold, would you leave it on your desk? Walk around with it on the street? Your odds of getting to where you're going with the gold are pretty good in most places, but it's still a big risk. Brag about or show that gold off to somebody, as many in this story did, and you rapidly become a target.
Stealing most crypto money is about the dumbest thing ever, because all transactions (for most such currencies) are open to the public to scrutinise and de-anonymous at their leisure. And the police is included in 'the public'.
Even with a public ledger, it's harder to trace than, for example, forcing someone to wire the cash via the traditional banking system.
With banking systems, each bank account has a unique address (private, but they'll cooperate with the government and police easily, and are experienced doing so), and that address is associated with a real person... and it operates slowly, which means the police can easily catch up to transactions. A transaction that crosses country boundaries has more scrutiny and takes longer, giving the police even more time and information.
Crypto has public unique addresses (public keys), but there's no requirement any of them have names associated with them, and most don't. It operates more quickly than large bank wires, and easily crosses international borders.
I'm not a fan of crypto, but even with public ledgers, it's less traceable and more anonymous than normal banks of most (all?) countries.
One key component being alluded to here is that banks are legally required to know who you are (KYC). And there are consequences if they don’t. That alone makes a huge difference in everything having to do with the traditional banking system.
Following your logic there never will be and there never was a traditional banking system because rules and regulation around banking keep getting changed.
> Even with a public ledger, it's harder to trace than, for example, forcing someone to wire the cash via the traditional banking system.
Not really. From the comfort of my home, I as a member of the general public can trace any, say, bitcoin transaction I feel like, and work on de-anonymising it. And not only today's transactions, but all bitcoin transactions ever.
To trace bank transfers, you need to be part of established law enforcement and have something like a warrant. (Or whatever the legal requirements are in your country.) The transfer might go via multiple countries with different rules and perhaps less enthusiastic authorities. And the data might get lost.
The lack of borders makes it more traceable as you don't run your head against a different jurisdiction bring unwilling to provide data. There's a lot of creative criminals though, and a lot of questionable creative crypto solutions that cater far too well to them.
If they don't cash out directly to an off-ramp there might not be a way to connect a crypto address to a person. If they use the crypto to buy illegal shit and sell that on the black market for cash - or sell the crypto directly on the black market for cash, they could evade detection.
I wonder how much crypto is changing hands off-market in shadier corners.
In at least two of these stories, the “bank balance” was public because the person posted it on social media (Belgian guy and Turkish influencer). Im not sure if the risk is any lower when you post “my savings account is up to $1.6million!” ?
Of course it is lower! You have plenty of rich people living in known places without any special security and no one comes to kidnap them because they cannot just send over their whole wealth in an irreversible transaction in a second.
The problem is not to know who has money, it is a system in which it is trivial to transfer it without any supervision and without any way to go back.
Just like encryption and cash. You wanna ban or discourage its use too?
Bad people can do bad things with good technology but that doesn't mean good people shouldn't use and benefit from that technology. I would think someone on HACKERnews would agree.
Who is this they? cryptocurrencies and there users are a highly fragmented ecosystem. Ofc if you only listen to the most obnoxious superficial corners you will find conmen like in any community involving finances.
cryptocurrencies solve real world problems but like any technology also have drawbacks.
Crypto has generated quite a few people who are rich but still have poverty mindset and don't understand that flashing your wealth attracts more issues than solves your problems. While I'm not rich, I'm definitely above average, and that's a big reason why I wear a jacket I bought in a second-hand shop ten years ago.
The best part in all this is that once the transaction goes through, the kidnappers can definitively verify that they've received the ransom that they were asking for, and that they no longer have any use for loose ends or witnesses.
The screenshot is an example of someone making a reference to "removing fingers" (direct quote from the image) to make someone "care more" (direct quote from the image).
Regarding all the asterisks, your guess is as good as mine. Perhaps it is to make the text look scarier and more menacing, or more serious, or to make it seem like it was written by a madman who will actually do what is described. It's hard to know why they did that.
I'm honestly surprised this hasn't been more prevalent, especially since state actors (NK at least) have used cryptocurrencies to get foreign currency for several years now. No matter how rich and paranoid you are, there are really little you can do to protect yourself from a state actor that wants to get you, especially in an era of ubiquitous digital tracking from tech company that are willing to sell all the Intel they have about you to the highest bidder.
Hindsight is 20/20. In the early days of crypto the promise of decentralized finance outside of the scrutiny of governments and financial institutions was seen as far from pointless. It only went awry when speculators turned up trying to make a profit from an ostensibly useful idea, and they took it so far that the original idea lost all its meaning so the well-meaning folk left.
Fact is it became popular with speculators faster than it did with anybody else, but the hodlers weren't doing anything to stop people from using it to buy pizza.
[1] https://tromp.github.io/blog/2020/12/20/soft-supply
Major issues, still existing, were never solved
Today the bitcoin network is still stuck at ~7 transactions a second.
This is not what the white paper promised.
I work in “traditional” (as in, non crypto) payment systems, and i can tell you that plenty of companies are looking into using cryto rails for complex remmitance routes.
The problem is swift network/correspondent/intermediary banking. When you want to send money abroad to badly connected banks of badly connected countries, you might have a big route chain (multiple times intermediaries), fees can be huge , and settlement can take a long time. For these “small” banks it can be extremely hard to get better banking partners for better network (as in banking not IT) connection (multiple reasons, from price to available business partner, and company bandwith to go with the project)
Stable coins are much simper by comparison, you just need a wallet, and you ate a n a global network with automated settlement. Now whats lacking is standardizing how to send a message “ your crypto X received money from our crypto wallet Y, from our customer with acct number yyy, intended to your customer with acct number xxx”
Still some guys send iso message via swift to semd those intents and then settle via crypto.
This is a non existing problem for intra-eu payments due to all eu members being part of TARGET settlement system, and there are pan-EU clearing systems, but as soon as you get to more “disconnected “ countries, or “smaller” banks cross continent, it’s a pain.
But why is this complicated? Isn't it mostly about regulations / KYC / AML, rather than anything technical?
Stablecoins are much simpler because they don't do anything with respect to regulations, they're just a dumb ledger. For those who don't want to bypass regulations and the legal system, stablecoins bring as much as yet another database / ledger, which are not the problem in the first place.
Decentralization doesn't benefit society? umh...
Centralization is what enabled today's societies to thrive. So when talking about decentralization you have to get into the specifics to show the value.
Centralization could be good, sometimes (if it works idk). The problem is that the financial world has been monopolized by certain entities and the barrier of entry is enormous. It is never fair to not play by the same rules when regulation favors big institutions, etc... Access to credit is difficult sometimes and unfair. But that is just a reason you could give in the US.
Decentralization ensures that countries that condemn their citizens to raising inflation can access other types of income. Some argentinians get paid in USDC, because their currency is just worthless in other countries, and they would never be able to access USD in their banks.
Decentralization (I have in mind something like Hyperliquid or even BTC) ensures that everybody in the world have access to the same economy without intermediaries asking for a fee. Which means, a person in Indian can access to income the same way a person in the US would. Or you could do a transfer overseas with less fees or regulation problems.
And do they? In practice? The theory is always sweet, but in practice once you take away "crime" and "hold to sell high" you'll be hard pressed to see too many, or widespread instances of usefulness. You don't make society better by just building a taller peak for a few if at the same time you're digging even deeper troughs for the many.
> Or you could do a transfer overseas with less fees or regulation problems.
Every time someone gets swindled out of their "deregulated, decentralized" money, every time someone loses a finger for their million dollar wallet, you have one more voice asking a centralized organization for protection, maybe with some regulation.
You handwave away all the obvious problems, even though technology or time won't solve any of them. Without protection most people will be screwed out of their belongings. Ask that person in India if they're eager to "access to income the same way a person in the US would" (whatever that means) if this means there's no recourse when they lose the money.
No, you don't need to worship Amazon in a libertarian system, Amazon lives thanks to regulation (Amazon supports raising the min wage), and other import fees & tax exemptions that smaller businesses can't afford to bypass.
To be fair, almost nothing that most techies work on benefits society.
On other hand efficiency for BTC mining does not matter. The energy expenditure always approaches the value of mined coins. When efficiency increase same energy is spend just to do more hashes, which are really not useful.
https://www.blockchain.com/explorer/charts/transactions-per-... https://crypto.com/en/university/blockchain-scalability
in total? or per transaction?
How many transaction BTC makes compared to Visa/Mastercard/bank transfers?
So thinking crypto will be an outlier is wishful thinking since it will never be allowed to be more powerful than governments. At most, new world orders will be created, but they will settle and be like the old ones, with some new more crypto native rules. They will always know who you ar and who you’re transacting with and where either of you are.
Current crypto fanatics are assuming they will all be part of this club. This road will be filled with poor old men with fewer fingers and lots of regret.
I want crypto to succeed, but I don’t expect it will be unregulated. You’ll pay the same taxes, you’ll go to jail if you try to avoid them or if you send crypto to entities banned by governments. Eventually the things that make crypto so valuable will be hammered out so it’s more like fiat.
Maybe the value will crash or wealthy people of today will find a way to freeze it into reserve currencies (like the newly minted federal crypto reserve), but after some point it will stop being a source of wealth just by holding it at the right time. You will need to exchange it with value you create.
The math of crypto wealth by HODLing is unsustainable.
It isn't implying that. It is implying that it will end up at the same place as the traditional finance.
> It says a lot about how bad the traditional finance
What is so bad about traditional finance that crypto fixes?
If you had a million in gold, would you leave it on your desk? Walk around with it on the street? Your odds of getting to where you're going with the gold are pretty good in most places, but it's still a big risk. Brag about or show that gold off to somebody, as many in this story did, and you rapidly become a target.
Physical security primer for Bitcoin (2019), https://www.youtube.com/watch?v=HUgPhPkS2yc
With banking systems, each bank account has a unique address (private, but they'll cooperate with the government and police easily, and are experienced doing so), and that address is associated with a real person... and it operates slowly, which means the police can easily catch up to transactions. A transaction that crosses country boundaries has more scrutiny and takes longer, giving the police even more time and information.
Crypto has public unique addresses (public keys), but there's no requirement any of them have names associated with them, and most don't. It operates more quickly than large bank wires, and easily crosses international borders.
I'm not a fan of crypto, but even with public ledgers, it's less traceable and more anonymous than normal banks of most (all?) countries.
Not really. From the comfort of my home, I as a member of the general public can trace any, say, bitcoin transaction I feel like, and work on de-anonymising it. And not only today's transactions, but all bitcoin transactions ever.
To trace bank transfers, you need to be part of established law enforcement and have something like a warrant. (Or whatever the legal requirements are in your country.) The transfer might go via multiple countries with different rules and perhaps less enthusiastic authorities. And the data might get lost.
I wonder how much crypto is changing hands off-market in shadier corners.
Bad people can do bad things with good technology but that doesn't mean good people shouldn't use and benefit from that technology. I would think someone on HACKERnews would agree.
And somehow they praise it as a solution to all world's problems.
cryptocurrencies solve real world problems but like any technology also have drawbacks.
With the right cryptocurrency also private and anonymous.
Defense contractors associated with the U.S. military said they would sever fingers to make me "care more" here is a screenshot:
https://imgur.com/a/eYP7Xsj
or
https://ibb.co/DD6XTppy
This was sent over a Department of Defense channel.
What’s with all the asterisks in the image?
Regarding all the asterisks, your guess is as good as mine. Perhaps it is to make the text look scarier and more menacing, or more serious, or to make it seem like it was written by a madman who will actually do what is described. It's hard to know why they did that.