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Are there any possible holes in the making you see now? I was curious for a while if crypto was going to pose a systemic risk, but the total market cap[0] was n

Are there any possible holes in the making you see now? I was curious for a while if crypto was going to pose a systemic risk, but the total market cap[0] was never really high enough. [0]https://coinmarketcap.com/ https://coinmarketcap.com/

charlesdm 9y ago
You say that as if it's over. I'm willing to bet a significant amount of money that it will pose a systemic risk in a few years.
- ojr 9y ago
  there are CFTC regulated bitcoin futures (CME/CBOE) where you can bet on the price dropping in a scenario where it becomes a systemic risk
  - charlesdm 9y ago
    Before the price can drop like that, it needs to become a systemic risk first. Meaning I think it will first still go up significantly before coming down.
thedevil 9y ago
I don't know much about crypto. I do know that 1) a payment system with transactions that take more than a few seconds and cost more than a few pennies is not a good payment system for most things. 2) I've never heard anyone talking about using crypto for anything but speculation or paying for ransomware. Even on the internet, I've mostly heard of speculation, ransomware prostitution and buying drugs. 3) Regulators don't like payment systems for ransomware, prostitution and buying drugs. 4) Assets whose prices are based on speculation eventually fall. I could be missing something. As I said, I don't know much about crypto-currencies. Please nobody bet on my comment alone. Also, timing collapses is difficult. Bubbles can last for more than a decade.
dumbass123 9y ago
The market cap of Crypto doesn't really have much to do with a systemic risk. System Risks, like what we saw from certain mortgage backed securities, arose from investors thinking something was safe when it really wasn't safe. There isn't really anyone professional who thinks Crytos are a low risk asset. The way certain mortgage backed securities were advertised, professional investors thought they were low risk and dumped a large amount of money into them. Banks and other investors also structured different products that also depended on them (with the assumption that they were low risk). In the end, we found out they got the math wrong and those investments weren't really low risk. That's what created a systemic risk.

charlesdm 9y ago

You say that as if it's over. I'm willing to bet a significant amount of money that it will pose a systemic risk in a few years.

ojr 9y ago
there are CFTC regulated bitcoin futures (CME/CBOE) where you can bet on the price dropping in a scenario where it becomes a systemic risk
- charlesdm 9y ago
  Before the price can drop like that, it needs to become a systemic risk first. Meaning I think it will first still go up significantly before coming down.

thedevil 9y ago

I don't know much about crypto. I do know that 1) a payment system with transactions that take more than a few seconds and cost more than a few pennies is not a good payment system for most things. 2) I've never heard anyone talking about using crypto for anything but speculation or paying for ransomware. Even on the internet, I've mostly heard of speculation, ransomware prostitution and buying drugs. 3) Regulators don't like payment systems for ransomware, prostitution and buying drugs. 4) Assets whose prices are based on speculation eventually fall. I could be missing something. As I said, I don't know much about crypto-currencies. Please nobody bet on my comment alone. Also, timing collapses is difficult. Bubbles can last for more than a decade.

dumbass123 9y ago

The market cap of Crypto doesn't really have much to do with a systemic risk. System Risks, like what we saw from certain mortgage backed securities, arose from investors thinking something was safe when it really wasn't safe. There isn't really anyone professional who thinks Crytos are a low risk asset. The way certain mortgage backed securities were advertised, professional investors thought they were low risk and dumped a large amount of money into them. Banks and other investors also structured different products that also depended on them (with the assumption that they were low risk). In the end, we found out they got the math wrong and those investments weren't really low risk. That's what created a systemic risk.