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Why did anyone trust FTX either? The trust was really based on the credibility of the person running it, and the fact they had bailed out some other failing exc
by twblalock 4y ago
Why did anyone trust FTX either? The trust was really based on the credibility of the person running it, and the fact they had bailed out some other failing exchanges. But there were no hard facts.
In fact it seemed like all it took was a public quarrel with the founder of another exchange to start the ball rolling toward total collapse -- again, because it was all based on personal credibility.
- rippercushions 4y agoIt's almost as if crypto tokens are intrinsically worthless!
- tim333 4y agoThough that's not really the issue here. Obviously they were worth something to the people buying and selling them.
- Vt71fcAqt7 4y agoCrypto is worth something in that it can be sold at a higher price. USD is worth something in that at the point where it isn't you already have much bigger problems
- onlyrealcuzzo 4y agoNot really. If I buy and sell a coin from myself with monopoly money for ever increasing prices - is it really worth anything? Obviously there are some inflows into crypto. But it's about 0.00001% of the daily volume.
- tim333 4y agoYeah but that's not the situation. If you have a bitcoin you can sell it to another person for several thousand real US dollars. Even if you hate crypto it has that value to it. I mean re "about 0.00001%" I've bought and sold bitcoin myself and usually for actual money. True there isn't much intrinsic value to the 0s and 1s making up a bitcoin but there aren't much to the the 0s and 1s making up the US$ or similar in your bank account.
- fshbbdssbbgdd 4y agoThey’re worth something today because people want them today. If they don’t have any real-world yield, that doesn’t make them worth anything tomorrow. As FTT just demonstrated, like so many have before.
- sullyj3 4y agoWait til you hear about how fiat works.
- chrisco255 4y agoYou can think that crypto is absolutely worthless. But then an exchange is like a casino, earning fees on other people's gambling. There's no reason for the casino to go bankrupt, unless...there's fraud going on.
- coffeebeqn 4y ago> the fact they had bailed out some other failing exchanges That happened after they were buying stadiums and had a Larry David spot on the superbowl. They were the archetypal dumb money, top of the bubble, company. No one should be surprised they couldn’t handle a financial stress test. Sam was great at PR and maybe not much else? This year this guy has been on every major podcast being touted as a genius philanthropist / “good” capitalist. Remember he just crashed TWO companies. Alameda and FTX. The bubble keeps popping. I’m curious who’s next. This almost certainly will ripple beyond crypto to general tech companies given how.. all the top VCs have billion dollar funds in crypto as my “exhibit A”