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Once ICO scams stop working, the world will move towards traditional models. Crypto is out there, and it's not going anywhere. Eventually someone will realize t

by shawn 8y ago

Once ICO scams stop working, the world will move towards traditional models. Crypto is out there, and it's not going anywhere. Eventually someone will realize that the smarter move is to create sustainable value over time.

jacquesm 8y ago
> Eventually someone will realize that the smarter move is to create sustainable value over time. Most ICO's - if not all of them - are powered by the greater fool theory, sustainable value isn't really on the table. I see value in the blockchain and some in BTC (but not as much as others apparently do), but the whole ICO concept seems to be just a way to transfer wealth from greedy suckers to even greedier suckers.
- shawn 8y ago
  One promising example is SpankChain. It's a cryptocurrency specifically designed for the porn market. Traditionally, it's hard to make money in porn due to fraud and chargebacks. Most payment processors also won't touch you. But crypto has no chargebacks, so it's a natural fit. One could argue that if you have to dip down to the level of porn just to find some value, ICOs are worth dismissing. But I would say that it's a decent example of the future potential.
  - detaro 8y ago
    If it is just payments, why have a special cryptocurrency? Or does it do something more clever?
    - shawn 8y ago
      A good question. And the answer is a bit surprising: community. If you search for spankchain, you'll likely end up on their discord. There are friendly people to help answer your questions and set you up. It's the same advantage YC has: by being a meta-layer, you end up attracting everyone who's trying to do anything in the space, rather than one specific aspect. Eventually, the network effects are most of the value.
  - jacquesm 8y ago
    > Traditionally, it's hard to make money in porn due to fraud and chargebacks. Is that so? Tell me more...
    - shawn 8y ago
      https://news.ycombinator.com/item?id=17432801 https://news.ycombinator.com/item?id=17432801 was what got me thinking along these lines. If CCBill has a stranglehold on the porn payment processing industry, crypto is a natural threat to them. And that implies crypto has real power to shake up old models.
  - madamelic 8y ago
    >One could argue that if you have to dip down to the level of porn just to find some value, ICOs are worth dismissing One could also argue that when porn starts adopting a technology, you should adopt it too because that tech is what is going to win. Porn has consistently chosen the winners and any tech that discourages or disallows porn's involvement loses.
    - notahacker 8y ago
      Contrary to popular belief, porn was available on Betamax... More to the point is there any evidence of the mainstream porn user actually adopting SpankChain (or any of the other supposed "blockchains for porn") as opposed to ICO profiteers adopting pornography as a relatively plausible potential future business model to sell unnecessary tokens at an implausibly high value? Just had a look at the company page of the service. The CEO is a "decentralization laser gun" who boasts about how much money he raised in other ICOs (hmmm...) as well as his favourite computer games. In lieu of an actual testimonial, we get him in blockquote saying "we've honestly got the best team ever". Apparently this is one of the more promising ICOs and yet it's making me feel the SEC parody ICO site was a bit mild...
  - QML 8y ago
    Why not use another, more liquid cryptocurrency like BTC or ETH then?
  - MBCook 8y ago
    You’re just moving the problem though. The sites won’t get chargebacks, the groups selling the coin to consumers will. Buy it with another crypto currency? Problem moves one step down the road again.
  - s73v3r_ 8y ago
    Assuming I'm someone who wants to spend money on adult entertainment, why would I want to use a coin specifically for that as opposed to a general purpose coin? Same for someone who works in adult entertainment; why would I want a coin who's only use is to pay for porn?
  - aiCeivi9 8y ago
    Does it actually solve the problem or just move it by one step/layer? Payment processors are already blocking cryptocurrency exchanges since best way to use stolen credit card is to buy cryptocurrency.
- arisAlexis 8y ago
  why would a company trying to build a product be a greater fool example? you mean all startups that fail at very high rates are also that?
  - jacquesm 8y ago
    > why would a company trying to build a product be a greater fool example? I think you sort of missed the point. > you mean all startups that fail at very high rates are also that? No, I did not mean that.
Analemma_ 8y ago
The market for lemons argument (https://en.wikipedia.org/wiki/The_Market_for_Lemons https://en.wikipedia.org/wiki/The_Market_for_Lemons) suggests this is not true. When a sufficiently large percentage of the market is fraudulent (and in the ICO space it's damn close to 100%), buyers will demand a price premium to compensate for their risk to the point where honest actors can't participate profitably. That isn't happening yet because we're still in the tulip mania phase, but eventually people will want such high returns for the absurd amount of risk in the crypto space that no one will bother.

by shawn 8y ago

jacquesm 8y ago

> Eventually someone will realize that the smarter move is to create sustainable value over time. Most ICO's - if not all of them - are powered by the greater fool theory, sustainable value isn't really on the table. I see value in the blockchain and some in BTC (but not as much as others apparently do), but the whole ICO concept seems to be just a way to transfer wealth from greedy suckers to even greedier suckers.

shawn 8y ago
One promising example is SpankChain. It's a cryptocurrency specifically designed for the porn market. Traditionally, it's hard to make money in porn due to fraud and chargebacks. Most payment processors also won't touch you. But crypto has no chargebacks, so it's a natural fit. One could argue that if you have to dip down to the level of porn just to find some value, ICOs are worth dismissing. But I would say that it's a decent example of the future potential.
- detaro 8y ago
  If it is just payments, why have a special cryptocurrency? Or does it do something more clever?
  - shawn 8y ago
    A good question. And the answer is a bit surprising: community. If you search for spankchain, you'll likely end up on their discord. There are friendly people to help answer your questions and set you up. It's the same advantage YC has: by being a meta-layer, you end up attracting everyone who's trying to do anything in the space, rather than one specific aspect. Eventually, the network effects are most of the value.
- jacquesm 8y ago
  > Traditionally, it's hard to make money in porn due to fraud and chargebacks. Is that so? Tell me more...
  - shawn 8y ago
    https://news.ycombinator.com/item?id=17432801 https://news.ycombinator.com/item?id=17432801 was what got me thinking along these lines. If CCBill has a stranglehold on the porn payment processing industry, crypto is a natural threat to them. And that implies crypto has real power to shake up old models.
- madamelic 8y ago
  >One could argue that if you have to dip down to the level of porn just to find some value, ICOs are worth dismissing One could also argue that when porn starts adopting a technology, you should adopt it too because that tech is what is going to win. Porn has consistently chosen the winners and any tech that discourages or disallows porn's involvement loses.
  - notahacker 8y ago
    Contrary to popular belief, porn was available on Betamax... More to the point is there any evidence of the mainstream porn user actually adopting SpankChain (or any of the other supposed "blockchains for porn") as opposed to ICO profiteers adopting pornography as a relatively plausible potential future business model to sell unnecessary tokens at an implausibly high value? Just had a look at the company page of the service. The CEO is a "decentralization laser gun" who boasts about how much money he raised in other ICOs (hmmm...) as well as his favourite computer games. In lieu of an actual testimonial, we get him in blockquote saying "we've honestly got the best team ever". Apparently this is one of the more promising ICOs and yet it's making me feel the SEC parody ICO site was a bit mild...
- QML 8y ago
  Why not use another, more liquid cryptocurrency like BTC or ETH then?
- MBCook 8y ago
  You’re just moving the problem though. The sites won’t get chargebacks, the groups selling the coin to consumers will. Buy it with another crypto currency? Problem moves one step down the road again.
- s73v3r_ 8y ago
  Assuming I'm someone who wants to spend money on adult entertainment, why would I want to use a coin specifically for that as opposed to a general purpose coin? Same for someone who works in adult entertainment; why would I want a coin who's only use is to pay for porn?
- aiCeivi9 8y ago
  Does it actually solve the problem or just move it by one step/layer? Payment processors are already blocking cryptocurrency exchanges since best way to use stolen credit card is to buy cryptocurrency.
arisAlexis 8y ago
why would a company trying to build a product be a greater fool example? you mean all startups that fail at very high rates are also that?
- jacquesm 8y ago
  > why would a company trying to build a product be a greater fool example? I think you sort of missed the point. > you mean all startups that fail at very high rates are also that? No, I did not mean that.

Analemma_ 8y ago

The market for lemons argument (https://en.wikipedia.org/wiki/The_Market_for_Lemons https://en.wikipedia.org/wiki/The_Market_for_Lemons) suggests this is not true. When a sufficiently large percentage of the market is fraudulent (and in the ICO space it's damn close to 100%), buyers will demand a price premium to compensate for their risk to the point where honest actors can't participate profitably. That isn't happening yet because we're still in the tulip mania phase, but eventually people will want such high returns for the absurd amount of risk in the crypto space that no one will bother.