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I have noticed that people come on here to gloat about things like this due to the pure hatred of crypto flowing through their veins without realizing that they

I have noticed that people come on here to gloat about things like this due to the pure hatred of crypto flowing through their veins without realizing that they are cheering on regular people suffering ultimately at what will be the expense of big banks and Wall Street and governments. What I mean is when these cryptos have problems or are hacked, regular people are the ones who stand to lose everything in most cases. You can believe that people are dumb for “falling for the scam” in the first place and deserve it, but if you really believe that then I feel sorry for you. It’s pretty obvious and has been for quite some time that the ultimate goal here is for a central bank digital currency (CBDC), and stories like this as well as the UST collapse play right into that hand. I guess what I’m saying is be careful what you wish for. A government/central bank issued digital currency will be far worse for privacy and security than any of these insignificant stablecoins. Imagine the government deciding when and where you are allowed to access your money or what you are allowed to spend it on and what items or stores you are allowed to shop for/in. I feel like it is even possible that Wall Street is BEHIND the collapse of these stablecoins. They couldn’t pay for better press to help convince the public that a CBDC is necessary for the future. I suspect the CBDCs are already ready to go, but their last step is convincing the public they need one. The push for a cashless society has been going on for a number of years now and seems amplified lately.

Nursie 4y ago
What I wish for is that governments hadn't sat on their hands when ordinary people were being scammed into these things in the first place. The entire cryptocurrency ecosystem represents a massive failure to regulate, and a massive victory of technical flim-flam salesmen in bamboozling the governments in the world into being afraid to regulate in case they strangled something valuable, when in fact they were allowing normal folks to get ripped off massively. If "regular people" are losing money, it's because "regular people" have been duped and regulators have been duped. It's sad they're losing money, but it's also entirely predictable. But do you know what? After years of being told I'm just a jealous idiot who doesn't understand cryptocurrency or blockchains by the oh-so-smart 'investors' in this space, I'm going to enjoy a bit of shadenfreude here, whatever you think of that. If the whole space collapses I will celebrate - hopefully fewer regular people will be duped in future.
boplicity 4y ago
> privacy and security This is where I'm confused. What are the actual advantages that cryptocurrency provides that are superior to the Fed and similar central banks? So far, in practice, they seem to lack quite a lot, in terms of actual security. And, in terms of privacy, I don't understand how crypto provides any real-world advantages to most people that banks don't provide, unless you want to operate outside the law. What am I missing here?
- kayamon 4y ago
  It's largely about inflation. Politicians can arbitrarily write blank checks to 'bail out' as many banks every year as they want, printing as much money as needed, but mostly that money goes to themselves and all their friends. They then lie about having done that, and if you press them on it they'll gaslight you to tell you that was all normal. As a result, all the world's evil, all the world's scams, they all just kinda bubble upwards. People pay off the debt from one stupid scam by borrowing more money. That money eventually comes from idk someone's 401K fund, which is 'too big to fail', more money gets printed, a bailout happens, and off we all go again. They shuffle the problems around the world so you don't see them. A problem in California would be a disaster, but if you can successfully shuffle the problem around the world to idk Syria, or uhh Ukraine this year isn't it, then you can simply drop a thermobaric weapon on them and then just carry on again. As long as there's a lunatic somewhere with his grubby thieving little hand on the money printer, furiously cranking out new dollars or rubles or whatever, then there's always more money to pay off the lies. Some people think it'd be nice if they could knock that shit off. It's kinda fucking up the world economy. Also some people may have perished. A form of money that works for everyone should be (a) freely tradable online, (b) backed by a real-world asset such as energy, (c) fair and randomly distributed in terms of inflation, not given to one madman, (d) open source and fully auditable, (e) voted upon by all parties so no one majority can seize power. We have this now, for this first time in our history, because of the Internet. It'd be nice to finally make use of it for something worthwhile. "The Times 03/Jan/2009 Chancellor on brink of second bailout for banks"
coding_unit_1 4y ago
How is the government (a publicly elected body that is subject to being held to account by that same public) telling when you can spend you money somehow worse than a private company (without any accountability) deciding their shitcoin is no longer allowed to trade or that they don't fancy pegging it properly anymore?
svachalek 4y ago
I was with you at the beginning but let's be clear that algorithmic stablecoins are indeed scams. It's quite possible to create a perpetual motion machine, if you just forget friction exists, or entropy, or some other subtle law of physics. In the same way, algorithmic stablecoins let you sell nothing for something just by making the process complicated enough.
zaphar 4y ago
I don't hate crypto per-se. Nor am I particularly gloating about it. However I hope that the silver lining here is that this will be yet another in my evergrowing list of examples to share when I advise people not to get involved in crypto. It's not a safe environment and the people getting hurt don't deserve to get hurt. The only weapon I have to help more people not get hurt is to use these cautionary tales to help inform them of the risk. The track record of crypto indicates that right now many governments are better at the whole monetary policy thing than any blockchain. Will blockchains fix these problems and mitigate the worst facets of human nature? Maybe, but I have no reason to believe they will right now and every argument that they will is rooted in a faith based statement about the inevitability of technilogical progress. A faith I don't subscribe to and therefore is unconvincing to me.
- ourmandave 4y ago
  Will blockchains fix these problems and mitigate the worst facets of human nature? Maybe,... Not sure how that will work when they power the coin of the realm for malware, human exploitation, etc.
  - zaphar 4y ago
    Like you I'm skeptical. But there are certainly things I have faith in that other people have no reason to believe so I'll allow other people their own faith based beliefs as well.
rtkwe 4y ago
The longer we prop up a crumbling tower the more people's money will be sunk into it when it inevitably falls. That's what happened in '08, we had this fantastical tower that was so big we couldn't let it fall so none of the people actually responsible felt any pain so we're building new dumber towers. https://www.smbc-comics.com/comic/the-village-and-the-tower https://www.smbc-comics.com/comic/the-village-and-the-tower
biztos 4y ago
> It’s pretty obvious … the ultimate goal here is for a central bank digital currency (CBDC) How is that obvious, or maybe — to whom? I think the whole CBDC idea as more like governments trying to pile on to the “blockchain” trend. We already have plenty of digitalization of our finances and it seems to be working ok, and while I’m sure there are some closet totalitarians who’d love to have a database of all transactions, I don’t think CBDC is the way they’re going to (try to) get there.
- FabHK 4y ago
  > I think the whole CBDC idea as more like governments trying to pile on to the “blockchain” trend. No. Central bank digital currencies need not be implemented with inefficient blockchain technology. Privacy is a big issue, but the solution to that is not a public blockchain. CBDC could be huge in actually disintermediating many banks. Note that in some societies (eg Sweden) most transactions are already cashless, so the whole issue of privacy is orthogonal to CBDC.
aabhay 4y ago
My opinion on why this particular community on HN is interested in crypto collapse stories is a) that we are probably embedded in the tech world already so a “happy” story (fund raise, adoption) just isn’t notable enough. Same reason why cable news only covers disasters. Then b) because many folks like me genuinely believe that many crypto schemes are ponzis and our technical brains have a cognitive dissonance to something wrong/nonsensical being propped up as right. And then c) it’s probably just the effect of a group dynamic whereby weakly held opinions are magnified in a shared setting making small things feel like large biases. I doubt most people here are actively protesting crypto or working towards its downfall.
- randomsearch 4y ago
  Yes, you just nailed it. It’s the cognitive dissonance. “That doesn’t make any sense, huh” leads to getting annoyed when the world seems to disagree with something that you just can’t figure out any other way.
Jordrok 4y ago
> It’s pretty obvious and has been for quite some time that the ultimate goal here is for a central bank digital currency (CBDC), and stories like this as well as the UST collapse play right into that hand. I'm not really sure why you would say this. If anything, I would say that stories like these point much more strongly towards an entirely crypto-less future. Who is going to trust the crypto ecosystem as a whole after all these collapses? > I feel like it is even possible that Wall Street is BEHIND the collapse of these stablecoins. They couldn’t pay for better press to help convince the public that a CBDC is necessary for the future. I suspect the CBDCs are already ready to go, but their last step is convincing the public they need one. And now you're swerving into full-on conspiracy theory speculation territory. Get a grip, man!
stickfigure 4y ago
Due to Metcalf's Law (currencies are the poster child for network effects), there is room in the marketplace for only a small handful of cryptocurrencies. Therefore bad cryptocurrencies are effectively an attack on good cryptocurrencies. I am generally pro-crypto, but I cheer when bad cryptocurrencies fail. And there are is a lot of bad right now...

Nursie 4y ago

What I wish for is that governments hadn't sat on their hands when ordinary people were being scammed into these things in the first place. The entire cryptocurrency ecosystem represents a massive failure to regulate, and a massive victory of technical flim-flam salesmen in bamboozling the governments in the world into being afraid to regulate in case they strangled something valuable, when in fact they were allowing normal folks to get ripped off massively. If "regular people" are losing money, it's because "regular people" have been duped and regulators have been duped. It's sad they're losing money, but it's also entirely predictable. But do you know what? After years of being told I'm just a jealous idiot who doesn't understand cryptocurrency or blockchains by the oh-so-smart 'investors' in this space, I'm going to enjoy a bit of shadenfreude here, whatever you think of that. If the whole space collapses I will celebrate - hopefully fewer regular people will be duped in future.

boplicity 4y ago

> privacy and security This is where I'm confused. What are the actual advantages that cryptocurrency provides that are superior to the Fed and similar central banks? So far, in practice, they seem to lack quite a lot, in terms of actual security. And, in terms of privacy, I don't understand how crypto provides any real-world advantages to most people that banks don't provide, unless you want to operate outside the law. What am I missing here?

kayamon 4y ago
It's largely about inflation. Politicians can arbitrarily write blank checks to 'bail out' as many banks every year as they want, printing as much money as needed, but mostly that money goes to themselves and all their friends. They then lie about having done that, and if you press them on it they'll gaslight you to tell you that was all normal. As a result, all the world's evil, all the world's scams, they all just kinda bubble upwards. People pay off the debt from one stupid scam by borrowing more money. That money eventually comes from idk someone's 401K fund, which is 'too big to fail', more money gets printed, a bailout happens, and off we all go again. They shuffle the problems around the world so you don't see them. A problem in California would be a disaster, but if you can successfully shuffle the problem around the world to idk Syria, or uhh Ukraine this year isn't it, then you can simply drop a thermobaric weapon on them and then just carry on again. As long as there's a lunatic somewhere with his grubby thieving little hand on the money printer, furiously cranking out new dollars or rubles or whatever, then there's always more money to pay off the lies. Some people think it'd be nice if they could knock that shit off. It's kinda fucking up the world economy. Also some people may have perished. A form of money that works for everyone should be (a) freely tradable online, (b) backed by a real-world asset such as energy, (c) fair and randomly distributed in terms of inflation, not given to one madman, (d) open source and fully auditable, (e) voted upon by all parties so no one majority can seize power. We have this now, for this first time in our history, because of the Internet. It'd be nice to finally make use of it for something worthwhile. "The Times 03/Jan/2009 Chancellor on brink of second bailout for banks"

coding_unit_1 4y ago

How is the government (a publicly elected body that is subject to being held to account by that same public) telling when you can spend you money somehow worse than a private company (without any accountability) deciding their shitcoin is no longer allowed to trade or that they don't fancy pegging it properly anymore?

svachalek 4y ago

I was with you at the beginning but let's be clear that algorithmic stablecoins are indeed scams. It's quite possible to create a perpetual motion machine, if you just forget friction exists, or entropy, or some other subtle law of physics. In the same way, algorithmic stablecoins let you sell nothing for something just by making the process complicated enough.

zaphar 4y ago

I don't hate crypto per-se. Nor am I particularly gloating about it. However I hope that the silver lining here is that this will be yet another in my evergrowing list of examples to share when I advise people not to get involved in crypto. It's not a safe environment and the people getting hurt don't deserve to get hurt. The only weapon I have to help more people not get hurt is to use these cautionary tales to help inform them of the risk. The track record of crypto indicates that right now many governments are better at the whole monetary policy thing than any blockchain. Will blockchains fix these problems and mitigate the worst facets of human nature? Maybe, but I have no reason to believe they will right now and every argument that they will is rooted in a faith based statement about the inevitability of technilogical progress. A faith I don't subscribe to and therefore is unconvincing to me.

ourmandave 4y ago
Will blockchains fix these problems and mitigate the worst facets of human nature? Maybe,... Not sure how that will work when they power the coin of the realm for malware, human exploitation, etc.
- zaphar 4y ago
  Like you I'm skeptical. But there are certainly things I have faith in that other people have no reason to believe so I'll allow other people their own faith based beliefs as well.

rtkwe 4y ago

The longer we prop up a crumbling tower the more people's money will be sunk into it when it inevitably falls. That's what happened in '08, we had this fantastical tower that was so big we couldn't let it fall so none of the people actually responsible felt any pain so we're building new dumber towers. https://www.smbc-comics.com/comic/the-village-and-the-tower https://www.smbc-comics.com/comic/the-village-and-the-tower

biztos 4y ago

> It’s pretty obvious … the ultimate goal here is for a central bank digital currency (CBDC) How is that obvious, or maybe — to whom? I think the whole CBDC idea as more like governments trying to pile on to the “blockchain” trend. We already have plenty of digitalization of our finances and it seems to be working ok, and while I’m sure there are some closet totalitarians who’d love to have a database of all transactions, I don’t think CBDC is the way they’re going to (try to) get there.

FabHK 4y ago
> I think the whole CBDC idea as more like governments trying to pile on to the “blockchain” trend. No. Central bank digital currencies need not be implemented with inefficient blockchain technology. Privacy is a big issue, but the solution to that is not a public blockchain. CBDC could be huge in actually disintermediating many banks. Note that in some societies (eg Sweden) most transactions are already cashless, so the whole issue of privacy is orthogonal to CBDC.

aabhay 4y ago

My opinion on why this particular community on HN is interested in crypto collapse stories is a) that we are probably embedded in the tech world already so a “happy” story (fund raise, adoption) just isn’t notable enough. Same reason why cable news only covers disasters. Then b) because many folks like me genuinely believe that many crypto schemes are ponzis and our technical brains have a cognitive dissonance to something wrong/nonsensical being propped up as right. And then c) it’s probably just the effect of a group dynamic whereby weakly held opinions are magnified in a shared setting making small things feel like large biases. I doubt most people here are actively protesting crypto or working towards its downfall.

randomsearch 4y ago
Yes, you just nailed it. It’s the cognitive dissonance. “That doesn’t make any sense, huh” leads to getting annoyed when the world seems to disagree with something that you just can’t figure out any other way.

Jordrok 4y ago

> It’s pretty obvious and has been for quite some time that the ultimate goal here is for a central bank digital currency (CBDC), and stories like this as well as the UST collapse play right into that hand. I'm not really sure why you would say this. If anything, I would say that stories like these point much more strongly towards an entirely crypto-less future. Who is going to trust the crypto ecosystem as a whole after all these collapses? > I feel like it is even possible that Wall Street is BEHIND the collapse of these stablecoins. They couldn’t pay for better press to help convince the public that a CBDC is necessary for the future. I suspect the CBDCs are already ready to go, but their last step is convincing the public they need one. And now you're swerving into full-on conspiracy theory speculation territory. Get a grip, man!

stickfigure 4y ago

Due to Metcalf's Law (currencies are the poster child for network effects), there is room in the marketplace for only a small handful of cryptocurrencies. Therefore bad cryptocurrencies are effectively an attack on good cryptocurrencies. I am generally pro-crypto, but I cheer when bad cryptocurrencies fail. And there are is a lot of bad right now...