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I know that feeling. I was on a subway platform when a rando started explaining to me how she was investing in bitcoin mining. She was a real estate agent with

I know that feeling. I was on a subway platform when a rando started explaining to me how she was investing in bitcoin mining. She was a real estate agent with no tech knowledge, but somebody she talked to persuaded her to buy and run hardware. What really scares me is that this was easily 5 years ago now. At the time I too thought "peak bubble". The extent to which this space has metastasized blows me away. Normally a scam dies when the novelty wanes and it runs out of suckers. But the cryptowhatever space has continually generated shiny new illusions for people to pump and dump. I'm now wondering if we've entered the age of the permanent floating scam, where "there's one born every minute" is enough to provide an eternal flow of suckers for an ever-shifting constellation of predators and useful idiots.

atwood22 4y ago
I didn't think Bitcoin was a bubble 5 years ago. The only people I knew using it were using it to buy drugs, and the price seemed to reflect that utility plus the novelty of its implementation. That real estate agent probably did quite well for herself, even at current prices.
- wpietri 4y ago
  Depends upon her timing and what she was doing. Bitcoin had a peak in late 2017 and then fell 75%, taking 3 years to recover. If whatever she "invested" in was even valid, it's plausible that she made her bet based on rising prices. Or that the hardware became obsolete sooner than she was told. Or that she doubled down based on thinking the fall was a blip. There are a lot of ways for amateurs to lose money, and many of those ways are, as here, engineered by the people eager to take advantage of amateurs.
  - atwood22 4y ago
    I guess it just feels a little elitist to assume she didn't know what she was doing because she was a real estate agent. She definitely was a part of the scene way before most people, so hindsight makes me think she should get some benefit of the doubt. Like yea, she sells real estate, but maybe likes to socialize with a more tech-oriented crowd, or used to work in tech herself but chose real estate to have better hours, etc.
    - skinnymuch 4y ago
      You can frequently tell how tech savvy someone is, at least to a degree. Just like someone can tell I don’t know anything about cars within a minute of talking about cars.
    - wpietri 4y ago
      I'm not assuming it was because she was a real estate agent. I specifically said she had no tech knowledge. It's nothing personal against real estate agents; half of one side of my family was in real estate. What makes you good in real estate is mainly dealing individually with people in a sales-y way, plus moderate knowledge of your local property market. It requires only 9th-grade math and no tech savvy. Is it possible she was also a tech genius? No. Because she not only said she wasn't into technology, she also quickly demonstrated that lack of knowledge. But more importantly, she was excited about bitcoin, which even then was obviously a technology that was not good for much besides creating a zero-value, highly hypeable speculative instrument.
jq-r 4y ago
You're right, its a perpetual scam. Every day there are thousands of kids who get old enough to think that they can get quick rich by being part of that scam. Some people exit the "market", many more enter it. That's a serious problem and I don't think it will end soon. That's the reason why a lot of those cryptocurrencies didn't go straight to zero in the last month or so, there are just more morons "buying the dip" and expecting that new money will come and create another hockey stick (and unfortunately it will as explained above).
godelski 4y ago
> Normally a scam dies when the novelty wanes and it runs out of suckers. But the cryptowhatever space has continually generated shiny new illusions for people to pump and dump. I think what's happening here is that there's both scams and legitimate usages. The legitimate users are having a hard time advancing because the scammers dominate the ecosystem and the scammers perpetuate because the legitimate users/developers keep using/developing. We see big companies investing in these companies. We also see scammers funding research (to help prop up the bubble and legitimize themselves). I think this is what separates crypto from tulip mania. At the end of the day, tulips had very little actual value. On the other hand, crypto does have some value, but people are convinced the technology is much further along than it actually is and thus the bubble refuses to pop. What the actual value of crypto is is up for debate. But I think we can all agree that it is neither zero nor what the current market reflects (at least the current state of crypto).
- wpietri 4y ago
  I have spent the better part of a decade looking for legitimate uses. By which I mean legal, value-creating activities that aren't served better by some other technology. The very best I've found is that it's good for some light financial crime. Some money laundering, some ransomware, various sorts of scams and fraud. When I compare Bitcoin's paltry real-world use versus, say, M-Pesa and Venmo, which target the same initial uses as Bitcoin, I think it's especially easy to see that the legitimate problems were long ago solved pretty well. So a decade in, I'm comfortable saying the actual value is near enough to zero that it makes no practical difference.
  - godelski 4y ago
    I think there is real value in having digital cash. That is, a digital currency that is both private and secure. I'm thinking something along the lines of zcash though, not bitcoin. I agree that there are other technologies that solve a lot of the same problems cryptocurrencies serve, but I think your search criteria is wrong. You're looking for legitimate users instead of looking for legitimate usecases. Since the tech is new the only legitimate users you're going to find are fanboys and geeks. This is going to tell us very little about real world usages. If we judged a technology's use case by the number of legitimate users then we'd never invent new technologies because there are never legitimate users using technology that doesn't exist (and very few when it is new). So I don't understand your search criteria. There are many big fin companies investigating and using different cryptocurrencies though. Whether you call these legitimate users or not is very debatable though.

atwood22 4y ago

I didn't think Bitcoin was a bubble 5 years ago. The only people I knew using it were using it to buy drugs, and the price seemed to reflect that utility plus the novelty of its implementation. That real estate agent probably did quite well for herself, even at current prices.

wpietri 4y ago
Depends upon her timing and what she was doing. Bitcoin had a peak in late 2017 and then fell 75%, taking 3 years to recover. If whatever she "invested" in was even valid, it's plausible that she made her bet based on rising prices. Or that the hardware became obsolete sooner than she was told. Or that she doubled down based on thinking the fall was a blip. There are a lot of ways for amateurs to lose money, and many of those ways are, as here, engineered by the people eager to take advantage of amateurs.
- atwood22 4y ago
  I guess it just feels a little elitist to assume she didn't know what she was doing because she was a real estate agent. She definitely was a part of the scene way before most people, so hindsight makes me think she should get some benefit of the doubt. Like yea, she sells real estate, but maybe likes to socialize with a more tech-oriented crowd, or used to work in tech herself but chose real estate to have better hours, etc.
  - skinnymuch 4y ago
    You can frequently tell how tech savvy someone is, at least to a degree. Just like someone can tell I don’t know anything about cars within a minute of talking about cars.
  - wpietri 4y ago
    I'm not assuming it was because she was a real estate agent. I specifically said she had no tech knowledge. It's nothing personal against real estate agents; half of one side of my family was in real estate. What makes you good in real estate is mainly dealing individually with people in a sales-y way, plus moderate knowledge of your local property market. It requires only 9th-grade math and no tech savvy. Is it possible she was also a tech genius? No. Because she not only said she wasn't into technology, she also quickly demonstrated that lack of knowledge. But more importantly, she was excited about bitcoin, which even then was obviously a technology that was not good for much besides creating a zero-value, highly hypeable speculative instrument.

jq-r 4y ago

You're right, its a perpetual scam. Every day there are thousands of kids who get old enough to think that they can get quick rich by being part of that scam. Some people exit the "market", many more enter it. That's a serious problem and I don't think it will end soon. That's the reason why a lot of those cryptocurrencies didn't go straight to zero in the last month or so, there are just more morons "buying the dip" and expecting that new money will come and create another hockey stick (and unfortunately it will as explained above).

godelski 4y ago

> Normally a scam dies when the novelty wanes and it runs out of suckers. But the cryptowhatever space has continually generated shiny new illusions for people to pump and dump. I think what's happening here is that there's both scams and legitimate usages. The legitimate users are having a hard time advancing because the scammers dominate the ecosystem and the scammers perpetuate because the legitimate users/developers keep using/developing. We see big companies investing in these companies. We also see scammers funding research (to help prop up the bubble and legitimize themselves). I think this is what separates crypto from tulip mania. At the end of the day, tulips had very little actual value. On the other hand, crypto does have some value, but people are convinced the technology is much further along than it actually is and thus the bubble refuses to pop. What the actual value of crypto is is up for debate. But I think we can all agree that it is neither zero nor what the current market reflects (at least the current state of crypto).

wpietri 4y ago
I have spent the better part of a decade looking for legitimate uses. By which I mean legal, value-creating activities that aren't served better by some other technology. The very best I've found is that it's good for some light financial crime. Some money laundering, some ransomware, various sorts of scams and fraud. When I compare Bitcoin's paltry real-world use versus, say, M-Pesa and Venmo, which target the same initial uses as Bitcoin, I think it's especially easy to see that the legitimate problems were long ago solved pretty well. So a decade in, I'm comfortable saying the actual value is near enough to zero that it makes no practical difference.
- godelski 4y ago
  I think there is real value in having digital cash. That is, a digital currency that is both private and secure. I'm thinking something along the lines of zcash though, not bitcoin. I agree that there are other technologies that solve a lot of the same problems cryptocurrencies serve, but I think your search criteria is wrong. You're looking for legitimate users instead of looking for legitimate usecases. Since the tech is new the only legitimate users you're going to find are fanboys and geeks. This is going to tell us very little about real world usages. If we judged a technology's use case by the number of legitimate users then we'd never invent new technologies because there are never legitimate users using technology that doesn't exist (and very few when it is new). So I don't understand your search criteria. There are many big fin companies investigating and using different cryptocurrencies though. Whether you call these legitimate users or not is very debatable though.