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Would someone mind calming me by explaining why this is not a huge red flag, this isn’t the beginning of the end, and a theoretical crypto crash won’t throw the
by soared 4y ago
Would someone mind calming me by explaining why this is not a huge red flag, this isn’t the beginning of the end, and a theoretical crypto crash won’t throw the market into turmoil (or why the current market turmoil ain’t so bad)?
I don’t have any kids to feed, just young dumb and tired of market crashes.
- ascendantlogic 4y agoIt sounds like it's a business that has run out of its own money at exactly the wrong time. There's no customer deposits on this exchange in terms of crypto accoording to their FAQ so this is a case of "startup runs out of money", not "crypto is going to zero"
- jimmydorry 4y agoMy speculation: It looks exactly like Robinhood (a liquidity issue), but without the faceless an unaccountable entity sitting behind them telling them to suspend trading. These guys appear to be acting as middlemen between their New Zealand customers and several exchanges. Bank transfers take days to finalize (and weeks to settle), so their business appears to be built around capitalizing on that time opportunity and allowing their customers to lock-in quotes without having to wait for their funds to appear in their exchange account if they dealt directly with an exchange. While the crypto markets are stable and the volume is predictable, everything is fine and they can maintain a balance on their exchanges and in their bank account. A sudden surge in volume (due to a massive price swing) means having to close shop and suspend trading while the transfer from exchange to bank account (or the other way) finalizes.
- gjvc 4y ago"The normalized insanity from the past several years is just beginning to unwind."
- imron 4y ago> or why the current market turmoil ain’t so bad You can buy the dip! /s
- cozzyd 4y agoBuy some (casino) chips first, then the dip...
- randomfinn 4y ago> a theoretical crypto crash won’t throw the market into turmoil I don't think it will affect markets much. There are only a few companies involved. Most of the money is from the retail investors, and that money is already gone. The crypto exchange balances going to zero won't change things much as those are mostly imaginary numbers anyway.
- smabie 4y agoReally hard to know the exact breakdown, but there's also a significant amount of institutional activity in crypto too. The recent crash has put a large whole in the balance shit of many trading firms and VCs
- gumby 4y agoCryptocurrencies are a tiny and insignificant part of the financial landscape. Maybe (formerly) a bit larger than VC but even less influential.
- senectus1 4y agoIt seems to be (I hope so anyway) quite inbred as well... for the most part, only those in the crypto space should be affected. with little repercussions in the wider world
- grapeskin 4y agoBitcoin alone was apparently given a market cap of over 2 trillion recently. That’s roughly the entire GDP of France. If France’s economy poofed out of existence or halved in value, that’d be a huge shake up.
- beezle 4y agoSlightly less than Apple's market cap.
- adamnemecek 4y agoGDP is annual. Market cap is not. It’s like comparing income with net worth.
- variaga 4y agoIt's the classic mistake of comparing stocks and flows
- aaaaaaaaata 4y agoTo Belgium, perhaps.
- the_gastropod 4y agoMarket cap is a hilariously meaningless term in the world of crypto. $2 Trillion very simple <number of coins> * <last purchase price> calculation. Nowhere near $2 Trillion of actual money are in this system. Comparing this to the GDP of one of the largest economies on the planet is... well, it's just silly.
- chris123 4y agoAll you have to know is that any coin that has to be backed by anything is a shit coin. Think about that. Understand that. There's only one coin that is not backed by anything, that has no founder, that has no ulterior motive, that is not centralized, that is not designed as a get rich quick scheme for the founders. And the venture capitalist, in the backers. You know which one that is. So if you make that realization, however painful, that might be, you are neo, you have taken a red pill. And no, that real world, your first glimpse of it, it's not going to be pretty, but then, after you process, you will see it is beautiful, it is full of hope and love, you have found home.
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- trophycase 4y agoNobody who uses crypto has ever heard of BitPrime
- woah 4y agoThis is some random startup nobody has heard of. HN likes to work themselves into a froth over every scrap of bad crypto news, but this is utterly insignificant. Crypto will continue to fluctuate wildly as it always has.
- rabuse 4y agoYeah, never heard of this exchange before.
- fny 4y agoDotcom bubble friends. BITO ETF at the top to unload VC capital onto a bag holding public.
- zionic 4y agoThis. They did the same thing with “terra USD”, some shitcoin I had never heard of until it failed. It was even named to confuse people by sounding like USDT. HN is only a step above CNN when it comes to trustworthiness on this specific topic.
- cycrutchfield 4y agoUST was like the #8 cryptocurrency by market cap…
- zionic 4y agoLots of scams have blown up and temporarily been there. I’m sure bitconnect did too.
- atleta 4y agoI'm not positive on crypto in general, but they seem to have run of of their own money (capital) and not their customers' money. I.e. they didn't lose their customers' coins. Actually, it seems that they have never held them anyway. So it's not like a bank crash. The service seems to have been making it possible for people to sell their coins directly to one another. (Crypto exchanges hold your crypto and don't do an actual transaction through the block chain until you withdraw what you have. Though they could still guarantee not losing your coins if they go bankrupt...) This is what they said about it: > Are my funds safe? > We don’t hold customer funds – at the time of the trade, we send the cryptocurrency directly to your wallet. If you need to execute a trade at this time, other platforms can facilitate this.
- Barrera 4y agoExchanges are auxiliary to Bitcoin. The protocol works quite well without any need for an exchange. The exchange in question is a small-time player. Back when the biggest of the big time players, Mt Gox, went under in 2014, Bitcoin came back stronger than ever.
- SkipperCat 4y agoBitcoin market cap is about 580 Billion. SP500 market cap is about 38 Trillion. During unremarkable market swings, the SP500 gains and loses the entire Bitcoin market cap daily (1.5%) Crypto can go to zero and the world will continue on.
- daniel-cussen 4y agoThese days rather, it loses and loses the entire market cap of bitcoin daily.
- hluska 4y agoI don’t like crypto and in all truth, I would love to use this as evidence that I’ve always been right. However, at its core, this story is about some random startup running out of money. It doesn’t mean a thing and I can’t possibly use it to slag on crypto.
- shadowgovt 4y agoI haven't seen a market crash since the housing crisis. Of course, I didn't move my money into crypto so that might be the reason.
- xwdv 4y agoWhile this particular event doesn’t mean much, if you are heavily invested in crypto you should be anything but calm. If you are big into an altcoin, prepare for that to go up in smoke the next few months. If you hold a lot of Bitcoin, make peace with it losing over 75% of value in the next few months. It’s going back to pre-covid levels at best.
- glerk 4y agoBTC, ETH and XMR are pretty comfy. A lot of scams are going to get purged, and that’s a good thing. Good projects will survive as they always do.
- xwdv 4y agoBTC already dropped another 1000. Will continue dropping.
- aaaaaaaaata 4y agoLots of 1000s to go.
- glerk 4y agoIf you’re so sure about that, put your money where your mouth is and go short it.
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- grey-area 4y agoThis is a sign (among many) of the endgame yes. If you have money in cryptocurrencies and can get it out you should do so now.
- SkyMarshal 4y agoCrypto is still a new and high-risk asset, and is considered a risk-on asset by all of the broader financial markets. When Fed interest rates are low and credit is cheap, money supply increases and more of it flows into higher risk/return assets like crypto and drives their prices up. When Fed interest rates go up and credit becomes more expensive, money supply decreases and funds flow out of high risk assets like crypto, driving their price down. The current bear market will last as long as the Fed continues raising interest rates, then turn back into a bull market when that reverses. Unless there's a war going on, in which case all bets are off.
- onlyrealcuzzo 4y agoLuckily we were still at the beginning of banks lending REAL money using Crypto as collateral. So you won't see much effect in the real economy. There is absurd amounts of Crypto lending that's probably causing a lot of margin calls forcing a negative feedback loop in Crypto prices. Everytime this happened before - the Central Bank of Tether came to the rescue and printed 10% of the entire Crypto market cap in ~2 days to pump up the market ~30%. Time will tell if they have the balls to do this now - when they're already under investigation in many jurisdictions.
- aaroninsf 4y agoIf you're talking about the crypto market crashing, yes, this is absolutely in context indicative of the speculative circus ending. Everyone knows the coyote has been running in air, waiting for various planks of a putative bridge to somewhere to materialize; those who put money into this vision who do not have it out now, will not get it back in a meaningful time frame, modulo dead cat bounce. IMO "hodling" anything other than the most conservative (sic) of "coins" means taking a total loss. Bitcoin and Ethereum and a few others may crawl back over a few years; whether there is appetitive for another bubble with them is TBD. It is not rational to believe their putative utility will emerge in that time; any future run up will merely be another round of speculation..