13 ms·

Let crypto burn

164 points by VagueMag 4y ago

siliconc0w 4y ago
FTX exploited the lack of legal clarity and regulation inside the US - the solution would seem be to create those things not let it 'implode' due to their absence.
- phphphphp 4y ago
  That's a soundbite that people like Brian Armstrong use, because it's shifting the blame onto The Enemy (the traditional finance system) but it's a hard sell. People engage with cryptocurrency because it offers the sort of unbounded financial opportunities only available when there's no regulation: there is already regulation that applies to all financial companies, the reason FTX primarily operated outside of the US was because of that regulation. Had there been "regulatory clarity" that further reiterated that what FTX was doing outside of the US isn't acceptable inside of the US, FTX would have remained outside of the US and continued to do the unregulated things. Anybody who wanted to use an exchange that complies with regulations could just use Coinbase. There's a reason people don't.
- SilverBirch 4y ago
  This doesn't make any sense. There is legal clarity and regulation inside the US. Crypto largely is deliberately attempting to create ambiguity. All the financial instruments created by crypto have real world regulated equivalents, whether that's ICOs or currencies of commodities. They already exist. What was FTX doing that CME, or a big hedge fund aren't? Well for one, FTX is a mix of those two businesses - why doesn't that exist in normal finance? Because of the dead obvious conflict of interests that we have seen resulted in exactly what happened at FTX. So what do you want? FTX to operate under the same regulations as traditional financial institutions? Ok. That's fine, but we already have those regulations, it's the crypto organisations that are pretending that they don't exist - for the exact reason they don't want to follow them.
monero-xmr 4y ago
I could not agree more as a crypto bull. Please avoid regulating us as much as possible and let everyone involved be responsible for themselves. No bailouts, never ever. Participants will be forced to invent new ways to establish trust which is ultimately good in the long run.
- SkyMarshal 4y ago
  I concur. Also part of establishing trust is moving away from all the ticking time-bomb centralized intermediaries from Mt.Gox to FTX and everything in between, etc. Either figure out ways of accomplishing everything decentralized and on-chain, or accept the impossibility as a natural constraint of the tech and learn to do without.
  - maxbond 4y ago
    Are you quite sure the root of the problem is centralized exchanges? Everything in "tradfi" is centralized, and there are frequent frauds and bad actors, but it remains much more robust than the cryptoasset ecosystem. I'd submit the root of the problem is finacializing things that are not economically productive. As cryptoasset supporters frequently point out, every market has some ponzenomic qualities, but pulling tokens from thin air amplifies them.
    - SkyMarshal 4y ago
      > Are you quite sure the root of the problem is centralized exchanges? That’s the big hypothesis being tested right now. So far it’s only the centralized entities that are collapsing, and crypto market values are down as a result, but that’s not the same thing as a collapse or failure of the protocols. But this train wreck is still happening, so we’ll see if it causes some cryptocurrencies to fail too. Possibly some of the weaker ones will lose too much mining/validating power and get hacked or 51% attacked. If that happens to the bigger ones then it will expose a serious problem with the tech and economics of it all. This is arguably the most valuable informational period in crypto’s history - the first high-interest environment stress test it’s ever had. Either it will cull the weak and leave standing only the ones robust enough to withstand such environment, or will cull the entire industry. Either way at least we’ll empirically know the truth of it all. > Everything in "tradfi" is centralized, and there are frequent frauds and bad actors, but it remains much more robust than the cryptoasset ecosystem. I think the GFC demonstrated “tradfi” is anything but robust. If not for the govt and Fed bailouts, the scale of the losses could have exceeded the banking system’s cumulative revenue of its entire modern history, going back to the 1800s. And that was with regulation (albeit steadily weakened since the 80s). You could potentially make the argument that certain forms of tradfi are robust, for example under the Glass-Steagal regime that separated commercial banking, investment banking, and insurance into separate legal entities, among other restrictions (a form of decentralization). Also Germany’s local community banking system, which until recent decades was the main financier of Germany’s industrial economy, and which has never had a financial crisis since its origins in the 1700s/1800s, is also quite a robust model (also a form of decentralization). > I’d submit the root of the problem is financializing things that are not economically productive I don’t disagree. Low-interest cheap money environments tend to have that effect, crypto or no-crypto.
djaouen 4y ago
I agree. Those stupid enough to invest in crypto deserve what they get lol
300bps 4y ago
Cryptocurrency is a solution desperately looking for a problem. The white paper was written 13 years ago. What actual problems does it legally solve? Store of value? Not so successful. Inflation hedge? Nope. Micropayments? Nobody wants them - any traditional financial company could implement it instantly. If people wanted it. So we are left with the few things that cryptocurrency has actually been good at: tax avoidance, illicit transactions and ransomware. Cryptocurrency has been a scourge and has no redeeming quantities. ETH mining did pay for a computer I bought a few times over though so I guess thanks for that.
- SkyMarshal 4y ago
  Anonymous and pseudonymous public, permissionless cryptocurrencies remove debt and leverage from the system, making GFC-like financial crises impossible. Without native identity, you can’t have native debt, leverage or margin. No native identity = no credit ratings or any other means of enforcing repayment. (Yes centralized crypto exchanges have these, but not the actual blockchains). All financial contracts on these systems must be fully- or over-collateralized, and if the collateral is used up there’s no margin calls for more, instead the contract is automatically closed. That creates an immense buffer against cascading financial collapse and house-of cards style financial structures that Wall St. likes to build. The possibility of a GFC or Great Depression (leveraged credit crises/collapse) is arguably the single biggest problem in all of the traditional financial system. Cryptocurrency may solve it.
  - 300bps 4y ago
    Sure and you could use blockchain to store your personal recipes but there are better tools to do it. There are many ways to prevent Wall Street or other organizations from becoming overleveraged.
    - SkyMarshal 4y ago
      Oh? Correct me if I’m wrong, but it seems all the ways of preventing Wall St. from becoming over leveraged fundamentally depend on regulation, which is vulnerable to lobbying and political capture. That’s happened twice now - dismantling of Glass-Steagal after the Great Depression, and dismantling of Dodd-Frank after the GFC. The former took decades, the latter was done in just ten years. My point is, crypto may represent a permanent and deterministic solution to this problem, implemented at the protocol/infrastructure level, and which is difficult or impossible to corrupt via lobbying and political capture.
malthaus 4y ago
Let it burn indeed - it's a hands-on history lesson for GenZ tech bros why every single cumbersome, expensive regulation exists in the financial sector currently. Besides, why should there be a need for regulation in a trustless system at all? If you think this is a beneficial setup, live (and die) by it.
- DennisP 4y ago
  FTX was not a trustless system. It was trusted, centralized exchange that happened to be trading crypto. Uniswap is a good example of a trustless exchange. It runs on chain and doesn't have admin keys. If you have assets in uniswap, the only person who can move them is you. We should regulate trusted actors that hold other people's money, and avoid interfering with trustless systems.
  - baxtr 4y ago
    How many people got sick rich through the rise of Uniswap?
    - DennisP 4y ago
      Not sure what bearing that has on my argument but probably not many, other than its developer (who collects fees). There's a governance token but even if you bought at the bottom and sold at the very top it was only a 13X gain (and if you held until now, a 2X gain overall). It's just a simple system that does its job with extreme reliability. Lots more people have made some money on Uniswap, either by trading well, or by providing liquidity and collecting a portion of fees.
      - baxtr 4y ago
        You’re arguing that a trustless will serve the many, whereas in reality only a few people got really rich. That doesn’t rhyme well.
        DennisP 4y ago
manholio 4y ago
This is an excelent regulatory option. The creation of money substitutes in the crypto space is not something a state wants to encourage, and is very detrimental to financial stability. The basic tools of the central bank - regulating reserves and interest rates in response to economic conditions - cease to function. These private money substitutes should be firewalled from the traditional financial system, nobody's pension should be invested in speculative crypto assets. The long term value of crypto should then result from the actual wealth they generate intrinsically (for example, ease of trade, enabling fast innovative transactions that fiat can't) - as opposed to broad "adoption" by the conventional financial industry, who would just use the space to circumvent existing regulations. Traditional finance can, in time, adopt tools and systems from the crypto space (for example, distributed ledgers, "blockchains") if they are technically robust, without the associated speculative mania.
- everfree 4y ago
  > Traditional finance can, in time, adopt tools and systems from the crypto space (for example, distributed ledgers, "blockchains") if they are technically robust, without the associated speculative mania. New technologies and speculative mania naturally come hand in hand, no? Crypto seems to be following the same adoption curve that all flashy new technologies have followed. https://i.imgur.com/uhYF1OW.png https://i.imgur.com/uhYF1OW.png There's the trigger, the peak of inflated expectations, the trough of disillusionment, the slope of enlightenment, then the plateau of productivity.
  - manholio 4y ago
    The problem with crypto is that instead of speculating on the premise of the actual inovative technology, the speculation is centered around the close money substitute that the technology enabled. Investors bet on crypto-assets themselves, freshly printed private coins, as if they are going to have substantial market dominance in the future to the detriment of state-issued fiat money. That is completely unsound. It's as if investors in the tech stocks would bet that a single company with an innovative trading solution would come to replace a substantial part / all of the stock market.
pricees 4y ago
Big bitcoin bull, here. Please let it all burn. But also please regulate and support US dollar backed stablecoins. Folks in various other countries shouldn’t suffer from their own governments lack of fiscal restraint and sophistication. If the US dollar is going to remain the reserve currency, make it accessible for everyone around the world.
- polygamous_bat 4y ago
  Should the US invade, say, Trinidad and Tobago if a company headquartered there starts a $1 Trillion market cap crypto stablecoin called USDX that's supposed to be 1:1 backed by dollar but actually isn't? We know that if there is a fake physical dollar printing press there, there will 100% involvement of physical force. How would crypto be different? In an unregulated market the unethical actor will always have an upper hand, and sometimes drastic actions like that will be necessary to protect the reserve currency status of USD. Are you ready for it?
  - BeFlatXIII 4y ago
    Why would an invasion be necessary there? If the US government does not accept USDX as payment for taxes, there remains a foundational difference between USDX and a real USD.
neilv 4y ago
> In the aftermath of the collapse of FTX, authorities should resist the urge to create a parallel legal and regulatory framework for the crypto industry. Agreed on not creating new frameworks, but... > It is far better to do nothing, and just let crypto burn. Is that like just letting every Bernie Madoff's scam run its course -- eventually retail investors and retirement funds will learn to stop investing in scams? Crypto scammers seem to be loving the wait&see thus far. Can't we just use the existing tools for dealing with investment scams, general fraud, etc., to take it all down?
- paulgb 4y ago
  Yes, I think the article presents a false dichotomy: - Create regulations that parallel the traditional financial system, or - Do nothing When there is a reasonable third option: - Don't create new regulations, but do aggressively pursue existing fraud in the market.
- manholio 4y ago
  > Is that like just letting every Bernie Madoff's scam run its course -- eventually retail investors and retirement funds will learn to stop investing in scams? Madoff was a scammer operating in a well regulated traditional financial space, where legitimate investment funds exist. The authors here propose segregating crypto from traditional finance by forbidding fiat fiduciaries to invest in crypto at all. Basically, recognize that most of the crypto is zero sum speculative game that has no legitimate investments, just like banks today are forbidden from purchasing lottery tickets with their depositors' money.
  - 411111111111111 4y ago
    > just like banks today are forbidden from purchasing lottery tickets with their depositors' money. Crypto should legally be considered gambling, because that's what it is. The scammers are just this generations gambling houses and the early adoptees are the equivalent to how the house always let's people win to get more people playing. It's inherently gambling, just slightly obscured.
jasmer 4y ago
Though wary of being too much of a negative naysayer ... still, yes, let it burn. So many of these scams have made their way into legitimate systems, like a disease. Let crypto find is way to utilitarian need via true, ephemeral, idiosyncratic and weirdo experiments, like the 'old days' of the web - not through leveraged Ponzi schemes disguised as progress. A lot of people have been waiting for this for some time. I just can't want for it all to go away, or at least the scammy bits.
seydor 4y ago
If you actually let it burn , it s going to be more powerful than you can ever imagine. Imagine a generation that actually knows what financial risks mean. That generation no longer needs regulation, nor handholding, and understands the concept of being their own bank. So they can leave the banks en masse, irreversibly, and internationally. And then crypto will be able to fulfil its purpose, the destruction of traditional finance and/or central banking If you don't bail them out, you 're only showing the cruel and elitist face of traditional finance. The 2008 crisis is too close to be forgotten. (i hope they don't bail anything out, of course)
- baxtr 4y ago
  Every single generation knows very well what financial risk means. We tend to forget though in cycle times of 10-15 years.
  - seydor 4y ago
    didn't the americans and europeans bail out a bunch of banks 10-13 years ago?
    - baxtr 4y ago
      that’s my point
      - seydor 4y ago
        but that means they didnt learn?
        baxtr 4y ago
        Indeed
- SkyMarshal 4y ago
  I really really really want to believe this is how it will turn out, but unfortunately I just can’t. The number of people who keep falling for the same confidence scams and whatnot (in and out of crypto) over and over, just makes me think that too many humans’ brains are hard-wired to be forever gullible to this stuff and will literally never learn no matter how many times they get burned.
yieldcrv 4y ago
If this article was about avoiding bailouts, most crypto proponents would actually agree But this article is about: > Rather than creating a new legal and regulatory framework that legitimises crypto, we should simply let it burn. in which case I don't agree, or only partially. Although crypto proponents are often allergic to the word regulation, there are some things that could be beneficial. But even with the traditional financial system, a couple CEOs in the 1930s thought it would be funny to get Congress to add confidence to their system with taxpayer dollars, none of this was default, and it would be naive to think the same couldn't be done with crypto.
EGreg 4y ago
The problem, as usual, is centralization. Not your keys - not your crypto. Stop keeping your money on exchanges. Use Dexes like Uniswap, lending marketplaces like Aave. The main problem crypto has is lack of adoption (user friendly interfaces, and community adoption) and lack of scalability in layer1. People are too distracted with zero-sum games to focus resources on innovating out of them. Similarly in the Web2 tech world.. advertising is a zero-sum game and Big Tech companies like Google and Facebook have been adding more and more ads obnoxiously over the years to compensate for the diminishing returns. This year they crashed whereas Apple and Verizon are going strong. The point is — innovate and build more usedul business models that aren’t zero sum!
- rahen 4y ago
  > Use Dexes like Uniswap, lending marketplaces like Aave. Shameless plug: Bisq is fully P2P and decentralized, it doesn't even require a website. Robosats is another contender. https://bisq.network https://bisq.network
- polygamous_bat 4y ago
  > Stop keeping your money on exchanges. Use Dexes like Uniswap, lending marketplaces like Aave. Surely it's the people's fault that crypto can't offer a better rate than $50 fee per swap.
  - everfree 4y ago
    > $50 fee per swap That was five years ago; it's no longer like that. Blockchain software design has progressed past its dial-up era. If you haven't noticed that, you just haven't been paying attention.
    - polygamous_bat 4y ago
      > > $50 fee per swap > That was five years ago; it's no longer like that. Straight up misinformation, see here [0] that Ethereum gas fees were almost 10x just one year ago. If the prices have fallen, it is because 1. no one is using ethereum anymore, not like in its hayday, and 2. Ethereum price itself has fallen. It's not because of "technological innovation" as you'd like to pretend. [0] https://ycharts.com/indicators/ethereum_average_gas_price https://ycharts.com/indicators/ethereum_average_gas_price
roland35 4y ago
This lecture by Berkeley CS professor Nicholas Weaver is a fantastic overview of what cryptocurrency and Blockchain actually is and why it is a complete waste of time, energy, and money and needs to be reduced to 0: https://youtu.be/J9nv0Ol-R5Q https://youtu.be/J9nv0Ol-R5Q I used to think "well maybe there is some real application of Bitcoin" but the more I learned about it I just realized the entire enterprise is awful and the only real benefit it has is uncensored money transfer. Which is great for ransomware. Now that Bitcoin is practically controlled by under 10 miners, there really is no decentralized part of it. Bitcoin maxis say you don't need to trust anyone, but that's not true. You gotta trust the code. Trust the miners. Also what good is magic internet money if I need to keep everything in an offline cold storage wallet to be secure? The only useful application now is using Bitcoin as a honeypot in your servers to notify you if a hacker has access to your systems (you'll see it when the wallet is drained!).
- DennisP 4y ago
  You can be secure with a hardware wallet. The keys stay internal to it, it shows the transaction data on its own display, you press a button on the hardware wallet to approve, and it passes the signed transaction back to your computer.
  - deleted 4y ago
    [deleted]
  - roland35 4y ago
    And what happens if I lose my wallet?? Or forgot the passcode?
    - DennisP 4y ago
      That's not a problem either, you keep a 24-word seed phrase as a backup. That's what goes in your deep cold storage. This has been well-known basic practice for years now. An emerging option is social recovery, as advocated by Vitalik. There are phone wallets now that let you have, say, 3 of 5 recovery, where the five are trusted friends/family or even a business or two.
jgilias 4y ago
It’s amusing how some people treat the collapse of one fraudulent CEX as the end of crypto. If there was an event that could’ve killed crypto then that would’ve been the collapse of Mt. Gox. Systemically speaking, the collapse of FTX is orders of magnitude less of an issue now than the collapse of Gox was then. I’m not saying crypto can’t be killed. It probably can be. But this is not it, not even close.
- tptacek 4y ago
  FTX cost investors a double-digit multiple of what Mt. Gox did.
  - arcbyte 4y ago
    In absolute terms, yes. But in relative terms how much of the crypto pie does FTX have versus MtGox back in the day?
- NotYourLawyer 4y ago
  Nobody outside of crypto enthusiasts had ever heard of Mt. Gox. EVERYBODY knows about Saint Bankman-Fried, the one honest man in crypto. This is a bigger deal for confidence than you think.
tptacek 4y ago
The sentiment is understandable but I think the hands-off approach has pretty clearly failed: ordinary retail investors are in fact plowing funds into crypto as investments (I went to grade school with several of them, who post constantly about this stuff on Facebook). In the status quo, nothing keeps a company like FTX from plastering Tom Brady and Gisele Bundchen all over Chicago, positioning itself as a real alternative to Fidelity or Schwab. Regulation doesn't have to mean legitimation. It can mean the opposite thing: ban public promotion of crypto assets, the same way we do with hedge funds and other qualified investments. Forbid FDIC-regulated institutions from accepting crypto as collateral. The contagion seems easy to stop.
- throwaway98797 4y ago
  FTX was in part big because coinbase could not release their yield product this would have been smaller if gary gensler didn’t intimidate brian armstrong pretty clear gary is hurting a lot of people by saying he’s helping
  - zmaurelius 4y ago
    It looked like Gensler was trying to secure a monopoly for FTX in the US, so making sure Coinbase didn't have a competing product was a cornerstone of that game plan.
can16358p 4y ago
One might be against crypto, I get it. But this whole article looks like as if it's written by a compulsive teenager who hates crypto because they've lost money in it. Regardless of the context and which side one is in, I'd expect more formal and serious articles from FT instead of teenager flame forum posts.
- lofatdairy 4y ago
  I think this is from FT Alphaville or at least affiliated (though the authors are professors so I am a bit surprised still). Alphaville seems to be an attempt to keep the FT relevant for a younger generation based on what I read during the SBF debacle. It's more in line with the tone of a Substack/newsletter post, which I think makes sense given the influence of similar approaches to financial reporting like Matt Levine.
wpietri 4y ago
I think a lot of people are responding to just the headline. For me a key part is, as the article says, making the new regulations "ones that limit exposure of traditional leveraged intermediaries to the crypto world". But I also think we need to make sure the existing substantial barriers for unsophisticated individuals investigating in dangerous products cover the crypto world. Pure "caveat emptor" works in a low-trust society. But it's wildly inefficient, which is why rich countries are high-trust societies enabled through regulation. E.g., the reason you can safely eat at most restaurants is a web of food safety laws and health department restaurants. People who are used to that are in for stomach-clutching surprises when they travel to low-regulation, low-trust areas. So for me letting crypto burn includes real barriers to scammers hoovering up the life savings of the naive. The simplest thing would be to extend the "accredited investor" standard, such that anybody who wants to play the digital ponies either needs to be rich enough to afford the losses or prove sufficient sophistication that they really know what they're doing. (And the answer to "but why" is twofold. One, society has to pick up the tab for people who run out of money. And two, the more money criminals have the more crime they can do, so we all have an interest in keeping the level of scams low.)
- SkyMarshal 4y ago
  > The simplest thing would be to extend the "accredited investor" standard, such that anybody who wants to play the digital ponies either needs to be rich enough to afford the losses or prove sufficient sophistication that they really know what they're doing. I think this is already more or less the case. The SEC recently updated the accredited investor standard to include not just means testing, but alternate sophistication tests like Series 7/63/etc, CFA iirc. I’m not sure how/if they fully enforce it or not, but they do to at least some extent, which is why FTX, Binance and others run two versions of their services, a US-based one and an international one.
  - tptacek 4y ago
    FTX had billboards up all over Chicago. A hedge fund can't do that; the regulations on qualified investments (at least pre-JOBS) prohibit promotion to retail investors.
alex_suzuki 4y ago
> Both crypto and traditional finance are simply combinations of a database and computer code. It would be straightforward for a group of technicians to convert any set of conditional cash flows from one into the other. chuckle Interesting take for a publication like FT. The Economist, another “reputable”, traditional outlet synonymous with traditional finance, has a more balanced and optimistic take, if anyone cares to read it. https://www.economist.com/leaders/2022/11/17/is-this-the-end-of-crypto https://www.economist.com/leaders/2022/11/17/is-this-the-end... Disclaimer: I hold ETH and am excited about its potential, and I also believe in Vitalik Buterin, which is a very different type of person from SBF.
everfree 4y ago
I take issue with this part of the article: > Absent clear and easily enforceable property rights, relying solely on private investors to monitor and discipline the behaviour of opaque intermediaries has never been safe and effective. There is no prospect for a technological solution to these age-old problems. The technical solution to opaque intermediaries is already here, and it's transparent intermediaries (enabled by smart contracts.) They let you replace an opaque piece of code running in a company's back room with a transparent piece of code that can be publicly read, understood, and audited. It can make an interaction with an intermediary very predictable and reliable, because you can trace/simulate the intermediary's exact code execution path (and thus know exactly what they are going to do with your money) before you even send the request. It's striking to me that the author doesn't state his opinion on smart contracts anywhere in the post. It makes me wonder whether he really thought they weren't a topic that readers would naturally use to contextualize his post, or whether he's ignorant of their existence. That's aside from the entire premise of the article being based on this idea that "crypto" is some monolithic corrupting force, rather than simply a messy emergent series of public databases that are as unthinking and uncaring as MySQL or Git. > Both crypto and traditional finance are simply combinations of a database and computer code. It would be straightforward for a group of technicians to convert any set of conditional cash flows from one into the other. The author seems so close to "getting it". If only he asked the question "now what changes when the general public has unfettered real-time read access to those databases and computer code," perhaps he could see the uniqueness of the design space, and appreciate that there's much more emergent game theory to work through before writing crypto off as being on a path of implosion into irrelevancy.
- polygamous_bat 4y ago
  Can you show me a smart contract that will let me exchange some amount of cryptocurrency for a banana? Ideally one which allows me to go after the banana seller if it turns out to be rotten, or worse, poisoned. If you can't, then please understand that in the real world you will always need a counterparty and a thousand intermediary for something as simple as a banana. All the "smart" contracts [1] are good for is a fancy way of swapping shitcoin A for shitcoin B, and until that changes none of what you said has any effect. [1] smart until they end up on rekt.news leaderboard.
polygamous_bat 4y ago
Copying my comment from an old thread because I'm still looking for a satisfying answer: > To the crypto-inclined people commenting on every thread about how failing centralized exchanges don't effect you and are actually good for Bitcoin, how are you planning to convert your hard earned crypto into US dollars that you can spend at a grocery store? If your answer is "P2P exchanges," how do you plan to secure your cold wallet against the infamous rubber hose cryptanalysis?
- dlubarov 4y ago
  I think it's prudent to use exchanges as needed, but only transfer assets that you intend to exchange in the near future, and withdraw once the exchange is done. There's still a slight risk, but much less compared to just letting funds sit on an exchange indefinitely. Of course, choosing a reputable, long-standing exchange like Coinbase also helps.
yucky 4y ago
All of this talk of regulation (or in this case, lack of it) reminds me that the US has repeatedly refused to allow an audit of our gold reserves. Why?
amf12 4y ago
> Absent clear and easily enforceable property rights, relying solely on private investors to monitor and discipline the behaviour of opaque intermediaries has never been safe and effective. There is no prospect for a technological solution to these age-old problems. I disagree. If anything, technology would provide solutions to these problems, but Crypto in its current form ain't it.
neonate 4y ago
https://archive.ph/swOsR https://archive.ph/swOsR
Marsh76 4y ago
Marsh76 4y ago
coreywill87 4y ago
According to some estimates, as much as 20% of the entire supply of bitcoin might be lost and irretrievable. Oftentimes, it can be impossible to find or recover lost bitcoin. That’s why it’s important for users who choose to hold their own private keys, a 256-bit string of numbers, to have a backup seed phrase stored safely. The best way to deal with this problem might be to make sure it never happens in the first place. That being said, there are some ways to try and recover an old bitcoin wallet. The best approach methods–and whether or not it will work–depends on how you lost the wallet. Read on for a guide that could help you find lost bitcoin in cases, when possible. Some developers have created programs that help recover the private keys to a bitcoin wallet. That this only works in cases in which the loser has deleted some or all of their keys. A program usually can’t help those who have forgotten their passwords, PIN numbers, or backup seed phrases. But if the user mistakenly deleted files with the relevant information, they may be able to recover them. If a user has a portion of the private key, it may be possible to find the rest of the key. DARKTRACER DIGITAL IS up foe the Task to recover all online transaction
coreywill87 4y ago
According to some estimates, as much as 20% of the entire supply of bitcoin might be lost and irretrievable. Oftentimes, it can be impossible to find or recover lost bitcoin. That’s why it’s important for users who choose to hold their own private keys, a 256-bit string of numbers, to have a backup seed phrase stored safely. The best way to deal with this problem might be to make sure it never happens in the first place. That being said, there are some ways to try and recover an old bitcoin wallet. The best approach methods–and whether or not it will work–depends on how you lost the wallet. Read on for a guide that could help you find lost bitcoin in cases, when possible. Some developers have created programs that help recover the private keys to a bitcoin wallet. That this only works in cases in which the loser has deleted some or all of their keys. A program usually can’t help those who have forgotten their passwords, PIN numbers, or backup seed phrases. But if the user mistakenly deleted files with the relevant information, they may be able to recover them. If a user has a portion of the private key, it may be possible to find the rest of the key. DARK TRACER DIGITAL is up for the Task to recover All stolen Asset

164 points by VagueMag 4y ago

FTX exploited the lack of legal clarity and regulation inside the US - the solution would seem be to create those things not let it 'implode' due to their absence.

phphphphp 4y ago
That's a soundbite that people like Brian Armstrong use, because it's shifting the blame onto The Enemy (the traditional finance system) but it's a hard sell. People engage with cryptocurrency because it offers the sort of unbounded financial opportunities only available when there's no regulation: there is already regulation that applies to all financial companies, the reason FTX primarily operated outside of the US was because of that regulation. Had there been "regulatory clarity" that further reiterated that what FTX was doing outside of the US isn't acceptable inside of the US, FTX would have remained outside of the US and continued to do the unregulated things. Anybody who wanted to use an exchange that complies with regulations could just use Coinbase. There's a reason people don't.
SilverBirch 4y ago
This doesn't make any sense. There is legal clarity and regulation inside the US. Crypto largely is deliberately attempting to create ambiguity. All the financial instruments created by crypto have real world regulated equivalents, whether that's ICOs or currencies of commodities. They already exist. What was FTX doing that CME, or a big hedge fund aren't? Well for one, FTX is a mix of those two businesses - why doesn't that exist in normal finance? Because of the dead obvious conflict of interests that we have seen resulted in exactly what happened at FTX. So what do you want? FTX to operate under the same regulations as traditional financial institutions? Ok. That's fine, but we already have those regulations, it's the crypto organisations that are pretending that they don't exist - for the exact reason they don't want to follow them.

monero-xmr 4y ago

I could not agree more as a crypto bull. Please avoid regulating us as much as possible and let everyone involved be responsible for themselves. No bailouts, never ever. Participants will be forced to invent new ways to establish trust which is ultimately good in the long run.

SkyMarshal 4y ago
I concur. Also part of establishing trust is moving away from all the ticking time-bomb centralized intermediaries from Mt.Gox to FTX and everything in between, etc. Either figure out ways of accomplishing everything decentralized and on-chain, or accept the impossibility as a natural constraint of the tech and learn to do without.
- maxbond 4y ago
  Are you quite sure the root of the problem is centralized exchanges? Everything in "tradfi" is centralized, and there are frequent frauds and bad actors, but it remains much more robust than the cryptoasset ecosystem. I'd submit the root of the problem is finacializing things that are not economically productive. As cryptoasset supporters frequently point out, every market has some ponzenomic qualities, but pulling tokens from thin air amplifies them.
  - SkyMarshal 4y ago
    > Are you quite sure the root of the problem is centralized exchanges? That’s the big hypothesis being tested right now. So far it’s only the centralized entities that are collapsing, and crypto market values are down as a result, but that’s not the same thing as a collapse or failure of the protocols. But this train wreck is still happening, so we’ll see if it causes some cryptocurrencies to fail too. Possibly some of the weaker ones will lose too much mining/validating power and get hacked or 51% attacked. If that happens to the bigger ones then it will expose a serious problem with the tech and economics of it all. This is arguably the most valuable informational period in crypto’s history - the first high-interest environment stress test it’s ever had. Either it will cull the weak and leave standing only the ones robust enough to withstand such environment, or will cull the entire industry. Either way at least we’ll empirically know the truth of it all. > Everything in "tradfi" is centralized, and there are frequent frauds and bad actors, but it remains much more robust than the cryptoasset ecosystem. I think the GFC demonstrated “tradfi” is anything but robust. If not for the govt and Fed bailouts, the scale of the losses could have exceeded the banking system’s cumulative revenue of its entire modern history, going back to the 1800s. And that was with regulation (albeit steadily weakened since the 80s). You could potentially make the argument that certain forms of tradfi are robust, for example under the Glass-Steagal regime that separated commercial banking, investment banking, and insurance into separate legal entities, among other restrictions (a form of decentralization). Also Germany’s local community banking system, which until recent decades was the main financier of Germany’s industrial economy, and which has never had a financial crisis since its origins in the 1700s/1800s, is also quite a robust model (also a form of decentralization). > I’d submit the root of the problem is financializing things that are not economically productive I don’t disagree. Low-interest cheap money environments tend to have that effect, crypto or no-crypto.

djaouen 4y ago

I agree. Those stupid enough to invest in crypto deserve what they get lol

300bps 4y ago

Cryptocurrency is a solution desperately looking for a problem. The white paper was written 13 years ago. What actual problems does it legally solve? Store of value? Not so successful. Inflation hedge? Nope. Micropayments? Nobody wants them - any traditional financial company could implement it instantly. If people wanted it. So we are left with the few things that cryptocurrency has actually been good at: tax avoidance, illicit transactions and ransomware. Cryptocurrency has been a scourge and has no redeeming quantities. ETH mining did pay for a computer I bought a few times over though so I guess thanks for that.

SkyMarshal 4y ago
Anonymous and pseudonymous public, permissionless cryptocurrencies remove debt and leverage from the system, making GFC-like financial crises impossible. Without native identity, you can’t have native debt, leverage or margin. No native identity = no credit ratings or any other means of enforcing repayment. (Yes centralized crypto exchanges have these, but not the actual blockchains). All financial contracts on these systems must be fully- or over-collateralized, and if the collateral is used up there’s no margin calls for more, instead the contract is automatically closed. That creates an immense buffer against cascading financial collapse and house-of cards style financial structures that Wall St. likes to build. The possibility of a GFC or Great Depression (leveraged credit crises/collapse) is arguably the single biggest problem in all of the traditional financial system. Cryptocurrency may solve it.
- 300bps 4y ago
  Sure and you could use blockchain to store your personal recipes but there are better tools to do it. There are many ways to prevent Wall Street or other organizations from becoming overleveraged.
  - SkyMarshal 4y ago
    Oh? Correct me if I’m wrong, but it seems all the ways of preventing Wall St. from becoming over leveraged fundamentally depend on regulation, which is vulnerable to lobbying and political capture. That’s happened twice now - dismantling of Glass-Steagal after the Great Depression, and dismantling of Dodd-Frank after the GFC. The former took decades, the latter was done in just ten years. My point is, crypto may represent a permanent and deterministic solution to this problem, implemented at the protocol/infrastructure level, and which is difficult or impossible to corrupt via lobbying and political capture.

malthaus 4y ago

Let it burn indeed - it's a hands-on history lesson for GenZ tech bros why every single cumbersome, expensive regulation exists in the financial sector currently. Besides, why should there be a need for regulation in a trustless system at all? If you think this is a beneficial setup, live (and die) by it.

DennisP 4y ago
FTX was not a trustless system. It was trusted, centralized exchange that happened to be trading crypto. Uniswap is a good example of a trustless exchange. It runs on chain and doesn't have admin keys. If you have assets in uniswap, the only person who can move them is you. We should regulate trusted actors that hold other people's money, and avoid interfering with trustless systems.
- baxtr 4y ago
  How many people got sick rich through the rise of Uniswap?
  - DennisP 4y ago
    Not sure what bearing that has on my argument but probably not many, other than its developer (who collects fees). There's a governance token but even if you bought at the bottom and sold at the very top it was only a 13X gain (and if you held until now, a 2X gain overall). It's just a simple system that does its job with extreme reliability. Lots more people have made some money on Uniswap, either by trading well, or by providing liquidity and collecting a portion of fees.
    - baxtr 4y ago
      You’re arguing that a trustless will serve the many, whereas in reality only a few people got really rich. That doesn’t rhyme well.
      - DennisP 4y ago

manholio 4y ago

This is an excelent regulatory option. The creation of money substitutes in the crypto space is not something a state wants to encourage, and is very detrimental to financial stability. The basic tools of the central bank - regulating reserves and interest rates in response to economic conditions - cease to function. These private money substitutes should be firewalled from the traditional financial system, nobody's pension should be invested in speculative crypto assets. The long term value of crypto should then result from the actual wealth they generate intrinsically (for example, ease of trade, enabling fast innovative transactions that fiat can't) - as opposed to broad "adoption" by the conventional financial industry, who would just use the space to circumvent existing regulations. Traditional finance can, in time, adopt tools and systems from the crypto space (for example, distributed ledgers, "blockchains") if they are technically robust, without the associated speculative mania.

everfree 4y ago
> Traditional finance can, in time, adopt tools and systems from the crypto space (for example, distributed ledgers, "blockchains") if they are technically robust, without the associated speculative mania. New technologies and speculative mania naturally come hand in hand, no? Crypto seems to be following the same adoption curve that all flashy new technologies have followed. https://i.imgur.com/uhYF1OW.png https://i.imgur.com/uhYF1OW.png There's the trigger, the peak of inflated expectations, the trough of disillusionment, the slope of enlightenment, then the plateau of productivity.
- manholio 4y ago
  The problem with crypto is that instead of speculating on the premise of the actual inovative technology, the speculation is centered around the close money substitute that the technology enabled. Investors bet on crypto-assets themselves, freshly printed private coins, as if they are going to have substantial market dominance in the future to the detriment of state-issued fiat money. That is completely unsound. It's as if investors in the tech stocks would bet that a single company with an innovative trading solution would come to replace a substantial part / all of the stock market.

pricees 4y ago

Big bitcoin bull, here. Please let it all burn. But also please regulate and support US dollar backed stablecoins. Folks in various other countries shouldn’t suffer from their own governments lack of fiscal restraint and sophistication. If the US dollar is going to remain the reserve currency, make it accessible for everyone around the world.

polygamous_bat 4y ago
Should the US invade, say, Trinidad and Tobago if a company headquartered there starts a $1 Trillion market cap crypto stablecoin called USDX that's supposed to be 1:1 backed by dollar but actually isn't? We know that if there is a fake physical dollar printing press there, there will 100% involvement of physical force. How would crypto be different? In an unregulated market the unethical actor will always have an upper hand, and sometimes drastic actions like that will be necessary to protect the reserve currency status of USD. Are you ready for it?
- BeFlatXIII 4y ago
  Why would an invasion be necessary there? If the US government does not accept USDX as payment for taxes, there remains a foundational difference between USDX and a real USD.

neilv 4y ago

> In the aftermath of the collapse of FTX, authorities should resist the urge to create a parallel legal and regulatory framework for the crypto industry. Agreed on not creating new frameworks, but... > It is far better to do nothing, and just let crypto burn. Is that like just letting every Bernie Madoff's scam run its course -- eventually retail investors and retirement funds will learn to stop investing in scams? Crypto scammers seem to be loving the wait&see thus far. Can't we just use the existing tools for dealing with investment scams, general fraud, etc., to take it all down?

paulgb 4y ago
Yes, I think the article presents a false dichotomy: - Create regulations that parallel the traditional financial system, or - Do nothing When there is a reasonable third option: - Don't create new regulations, but do aggressively pursue existing fraud in the market.
manholio 4y ago
> Is that like just letting every Bernie Madoff's scam run its course -- eventually retail investors and retirement funds will learn to stop investing in scams? Madoff was a scammer operating in a well regulated traditional financial space, where legitimate investment funds exist. The authors here propose segregating crypto from traditional finance by forbidding fiat fiduciaries to invest in crypto at all. Basically, recognize that most of the crypto is zero sum speculative game that has no legitimate investments, just like banks today are forbidden from purchasing lottery tickets with their depositors' money.
- 411111111111111 4y ago
  > just like banks today are forbidden from purchasing lottery tickets with their depositors' money. Crypto should legally be considered gambling, because that's what it is. The scammers are just this generations gambling houses and the early adoptees are the equivalent to how the house always let's people win to get more people playing. It's inherently gambling, just slightly obscured.

jasmer 4y ago

Though wary of being too much of a negative naysayer ... still, yes, let it burn. So many of these scams have made their way into legitimate systems, like a disease. Let crypto find is way to utilitarian need via true, ephemeral, idiosyncratic and weirdo experiments, like the 'old days' of the web - not through leveraged Ponzi schemes disguised as progress. A lot of people have been waiting for this for some time. I just can't want for it all to go away, or at least the scammy bits.

seydor 4y ago

If you actually let it burn , it s going to be more powerful than you can ever imagine. Imagine a generation that actually knows what financial risks mean. That generation no longer needs regulation, nor handholding, and understands the concept of being their own bank. So they can leave the banks en masse, irreversibly, and internationally. And then crypto will be able to fulfil its purpose, the destruction of traditional finance and/or central banking If you don't bail them out, you 're only showing the cruel and elitist face of traditional finance. The 2008 crisis is too close to be forgotten. (i hope they don't bail anything out, of course)

baxtr 4y ago
Every single generation knows very well what financial risk means. We tend to forget though in cycle times of 10-15 years.
- seydor 4y ago
  didn't the americans and europeans bail out a bunch of banks 10-13 years ago?
  - baxtr 4y ago
    that’s my point
    - seydor 4y ago
      but that means they didnt learn?
      - baxtr 4y ago
        Indeed
SkyMarshal 4y ago
I really really really want to believe this is how it will turn out, but unfortunately I just can’t. The number of people who keep falling for the same confidence scams and whatnot (in and out of crypto) over and over, just makes me think that too many humans’ brains are hard-wired to be forever gullible to this stuff and will literally never learn no matter how many times they get burned.

yieldcrv 4y ago

If this article was about avoiding bailouts, most crypto proponents would actually agree But this article is about: > Rather than creating a new legal and regulatory framework that legitimises crypto, we should simply let it burn. in which case I don't agree, or only partially. Although crypto proponents are often allergic to the word regulation, there are some things that could be beneficial. But even with the traditional financial system, a couple CEOs in the 1930s thought it would be funny to get Congress to add confidence to their system with taxpayer dollars, none of this was default, and it would be naive to think the same couldn't be done with crypto.

EGreg 4y ago

The problem, as usual, is centralization. Not your keys - not your crypto. Stop keeping your money on exchanges. Use Dexes like Uniswap, lending marketplaces like Aave. The main problem crypto has is lack of adoption (user friendly interfaces, and community adoption) and lack of scalability in layer1. People are too distracted with zero-sum games to focus resources on innovating out of them. Similarly in the Web2 tech world.. advertising is a zero-sum game and Big Tech companies like Google and Facebook have been adding more and more ads obnoxiously over the years to compensate for the diminishing returns. This year they crashed whereas Apple and Verizon are going strong. The point is — innovate and build more usedul business models that aren’t zero sum!

rahen 4y ago
> Use Dexes like Uniswap, lending marketplaces like Aave. Shameless plug: Bisq is fully P2P and decentralized, it doesn't even require a website. Robosats is another contender. https://bisq.network https://bisq.network
polygamous_bat 4y ago
> Stop keeping your money on exchanges. Use Dexes like Uniswap, lending marketplaces like Aave. Surely it's the people's fault that crypto can't offer a better rate than $50 fee per swap.
- everfree 4y ago
  > $50 fee per swap That was five years ago; it's no longer like that. Blockchain software design has progressed past its dial-up era. If you haven't noticed that, you just haven't been paying attention.
  - polygamous_bat 4y ago
    > > $50 fee per swap > That was five years ago; it's no longer like that. Straight up misinformation, see here [0] that Ethereum gas fees were almost 10x just one year ago. If the prices have fallen, it is because 1. no one is using ethereum anymore, not like in its hayday, and 2. Ethereum price itself has fallen. It's not because of "technological innovation" as you'd like to pretend. [0] https://ycharts.com/indicators/ethereum_average_gas_price https://ycharts.com/indicators/ethereum_average_gas_price

roland35 4y ago

This lecture by Berkeley CS professor Nicholas Weaver is a fantastic overview of what cryptocurrency and Blockchain actually is and why it is a complete waste of time, energy, and money and needs to be reduced to 0: https://youtu.be/J9nv0Ol-R5Q https://youtu.be/J9nv0Ol-R5Q I used to think "well maybe there is some real application of Bitcoin" but the more I learned about it I just realized the entire enterprise is awful and the only real benefit it has is uncensored money transfer. Which is great for ransomware. Now that Bitcoin is practically controlled by under 10 miners, there really is no decentralized part of it. Bitcoin maxis say you don't need to trust anyone, but that's not true. You gotta trust the code. Trust the miners. Also what good is magic internet money if I need to keep everything in an offline cold storage wallet to be secure? The only useful application now is using Bitcoin as a honeypot in your servers to notify you if a hacker has access to your systems (you'll see it when the wallet is drained!).

DennisP 4y ago
You can be secure with a hardware wallet. The keys stay internal to it, it shows the transaction data on its own display, you press a button on the hardware wallet to approve, and it passes the signed transaction back to your computer.
- deleted 4y ago
  [deleted]
- roland35 4y ago
  And what happens if I lose my wallet?? Or forgot the passcode?
  - DennisP 4y ago
    That's not a problem either, you keep a 24-word seed phrase as a backup. That's what goes in your deep cold storage. This has been well-known basic practice for years now. An emerging option is social recovery, as advocated by Vitalik. There are phone wallets now that let you have, say, 3 of 5 recovery, where the five are trusted friends/family or even a business or two.

jgilias 4y ago

It’s amusing how some people treat the collapse of one fraudulent CEX as the end of crypto. If there was an event that could’ve killed crypto then that would’ve been the collapse of Mt. Gox. Systemically speaking, the collapse of FTX is orders of magnitude less of an issue now than the collapse of Gox was then. I’m not saying crypto can’t be killed. It probably can be. But this is not it, not even close.

tptacek 4y ago
FTX cost investors a double-digit multiple of what Mt. Gox did.
- arcbyte 4y ago
  In absolute terms, yes. But in relative terms how much of the crypto pie does FTX have versus MtGox back in the day?
NotYourLawyer 4y ago
Nobody outside of crypto enthusiasts had ever heard of Mt. Gox. EVERYBODY knows about Saint Bankman-Fried, the one honest man in crypto. This is a bigger deal for confidence than you think.

tptacek 4y ago

The sentiment is understandable but I think the hands-off approach has pretty clearly failed: ordinary retail investors are in fact plowing funds into crypto as investments (I went to grade school with several of them, who post constantly about this stuff on Facebook). In the status quo, nothing keeps a company like FTX from plastering Tom Brady and Gisele Bundchen all over Chicago, positioning itself as a real alternative to Fidelity or Schwab. Regulation doesn't have to mean legitimation. It can mean the opposite thing: ban public promotion of crypto assets, the same way we do with hedge funds and other qualified investments. Forbid FDIC-regulated institutions from accepting crypto as collateral. The contagion seems easy to stop.

throwaway98797 4y ago
FTX was in part big because coinbase could not release their yield product this would have been smaller if gary gensler didn’t intimidate brian armstrong pretty clear gary is hurting a lot of people by saying he’s helping
- zmaurelius 4y ago
  It looked like Gensler was trying to secure a monopoly for FTX in the US, so making sure Coinbase didn't have a competing product was a cornerstone of that game plan.

can16358p 4y ago

One might be against crypto, I get it. But this whole article looks like as if it's written by a compulsive teenager who hates crypto because they've lost money in it. Regardless of the context and which side one is in, I'd expect more formal and serious articles from FT instead of teenager flame forum posts.

lofatdairy 4y ago
I think this is from FT Alphaville or at least affiliated (though the authors are professors so I am a bit surprised still). Alphaville seems to be an attempt to keep the FT relevant for a younger generation based on what I read during the SBF debacle. It's more in line with the tone of a Substack/newsletter post, which I think makes sense given the influence of similar approaches to financial reporting like Matt Levine.

wpietri 4y ago

I think a lot of people are responding to just the headline. For me a key part is, as the article says, making the new regulations "ones that limit exposure of traditional leveraged intermediaries to the crypto world". But I also think we need to make sure the existing substantial barriers for unsophisticated individuals investigating in dangerous products cover the crypto world. Pure "caveat emptor" works in a low-trust society. But it's wildly inefficient, which is why rich countries are high-trust societies enabled through regulation. E.g., the reason you can safely eat at most restaurants is a web of food safety laws and health department restaurants. People who are used to that are in for stomach-clutching surprises when they travel to low-regulation, low-trust areas. So for me letting crypto burn includes real barriers to scammers hoovering up the life savings of the naive. The simplest thing would be to extend the "accredited investor" standard, such that anybody who wants to play the digital ponies either needs to be rich enough to afford the losses or prove sufficient sophistication that they really know what they're doing. (And the answer to "but why" is twofold. One, society has to pick up the tab for people who run out of money. And two, the more money criminals have the more crime they can do, so we all have an interest in keeping the level of scams low.)

SkyMarshal 4y ago
> The simplest thing would be to extend the "accredited investor" standard, such that anybody who wants to play the digital ponies either needs to be rich enough to afford the losses or prove sufficient sophistication that they really know what they're doing. I think this is already more or less the case. The SEC recently updated the accredited investor standard to include not just means testing, but alternate sophistication tests like Series 7/63/etc, CFA iirc. I’m not sure how/if they fully enforce it or not, but they do to at least some extent, which is why FTX, Binance and others run two versions of their services, a US-based one and an international one.
- tptacek 4y ago
  FTX had billboards up all over Chicago. A hedge fund can't do that; the regulations on qualified investments (at least pre-JOBS) prohibit promotion to retail investors.

alex_suzuki 4y ago

> Both crypto and traditional finance are simply combinations of a database and computer code. It would be straightforward for a group of technicians to convert any set of conditional cash flows from one into the other. chuckle Interesting take for a publication like FT. The Economist, another “reputable”, traditional outlet synonymous with traditional finance, has a more balanced and optimistic take, if anyone cares to read it. https://www.economist.com/leaders/2022/11/17/is-this-the-end-of-crypto https://www.economist.com/leaders/2022/11/17/is-this-the-end... Disclaimer: I hold ETH and am excited about its potential, and I also believe in Vitalik Buterin, which is a very different type of person from SBF.

everfree 4y ago

I take issue with this part of the article: > Absent clear and easily enforceable property rights, relying solely on private investors to monitor and discipline the behaviour of opaque intermediaries has never been safe and effective. There is no prospect for a technological solution to these age-old problems. The technical solution to opaque intermediaries is already here, and it's transparent intermediaries (enabled by smart contracts.) They let you replace an opaque piece of code running in a company's back room with a transparent piece of code that can be publicly read, understood, and audited. It can make an interaction with an intermediary very predictable and reliable, because you can trace/simulate the intermediary's exact code execution path (and thus know exactly what they are going to do with your money) before you even send the request. It's striking to me that the author doesn't state his opinion on smart contracts anywhere in the post. It makes me wonder whether he really thought they weren't a topic that readers would naturally use to contextualize his post, or whether he's ignorant of their existence. That's aside from the entire premise of the article being based on this idea that "crypto" is some monolithic corrupting force, rather than simply a messy emergent series of public databases that are as unthinking and uncaring as MySQL or Git. > Both crypto and traditional finance are simply combinations of a database and computer code. It would be straightforward for a group of technicians to convert any set of conditional cash flows from one into the other. The author seems so close to "getting it". If only he asked the question "now what changes when the general public has unfettered real-time read access to those databases and computer code," perhaps he could see the uniqueness of the design space, and appreciate that there's much more emergent game theory to work through before writing crypto off as being on a path of implosion into irrelevancy.

polygamous_bat 4y ago
Can you show me a smart contract that will let me exchange some amount of cryptocurrency for a banana? Ideally one which allows me to go after the banana seller if it turns out to be rotten, or worse, poisoned. If you can't, then please understand that in the real world you will always need a counterparty and a thousand intermediary for something as simple as a banana. All the "smart" contracts [1] are good for is a fancy way of swapping shitcoin A for shitcoin B, and until that changes none of what you said has any effect. [1] smart until they end up on rekt.news leaderboard.

polygamous_bat 4y ago

Copying my comment from an old thread because I'm still looking for a satisfying answer: > To the crypto-inclined people commenting on every thread about how failing centralized exchanges don't effect you and are actually good for Bitcoin, how are you planning to convert your hard earned crypto into US dollars that you can spend at a grocery store? If your answer is "P2P exchanges," how do you plan to secure your cold wallet against the infamous rubber hose cryptanalysis?

dlubarov 4y ago
I think it's prudent to use exchanges as needed, but only transfer assets that you intend to exchange in the near future, and withdraw once the exchange is done. There's still a slight risk, but much less compared to just letting funds sit on an exchange indefinitely. Of course, choosing a reputable, long-standing exchange like Coinbase also helps.

yucky 4y ago

All of this talk of regulation (or in this case, lack of it) reminds me that the US has repeatedly refused to allow an audit of our gold reserves. Why?

amf12 4y ago

> Absent clear and easily enforceable property rights, relying solely on private investors to monitor and discipline the behaviour of opaque intermediaries has never been safe and effective. There is no prospect for a technological solution to these age-old problems. I disagree. If anything, technology would provide solutions to these problems, but Crypto in its current form ain't it.

neonate 4y ago

https://archive.ph/swOsR https://archive.ph/swOsR

Marsh76 4y ago

coreywill87 4y ago

According to some estimates, as much as 20% of the entire supply of bitcoin might be lost and irretrievable. Oftentimes, it can be impossible to find or recover lost bitcoin. That’s why it’s important for users who choose to hold their own private keys, a 256-bit string of numbers, to have a backup seed phrase stored safely. The best way to deal with this problem might be to make sure it never happens in the first place. That being said, there are some ways to try and recover an old bitcoin wallet. The best approach methods–and whether or not it will work–depends on how you lost the wallet. Read on for a guide that could help you find lost bitcoin in cases, when possible. Some developers have created programs that help recover the private keys to a bitcoin wallet. That this only works in cases in which the loser has deleted some or all of their keys. A program usually can’t help those who have forgotten their passwords, PIN numbers, or backup seed phrases. But if the user mistakenly deleted files with the relevant information, they may be able to recover them. If a user has a portion of the private key, it may be possible to find the rest of the key. DARKTRACER DIGITAL IS up foe the Task to recover all online transaction

coreywill87 4y ago

According to some estimates, as much as 20% of the entire supply of bitcoin might be lost and irretrievable. Oftentimes, it can be impossible to find or recover lost bitcoin. That’s why it’s important for users who choose to hold their own private keys, a 256-bit string of numbers, to have a backup seed phrase stored safely. The best way to deal with this problem might be to make sure it never happens in the first place. That being said, there are some ways to try and recover an old bitcoin wallet. The best approach methods–and whether or not it will work–depends on how you lost the wallet. Read on for a guide that could help you find lost bitcoin in cases, when possible. Some developers have created programs that help recover the private keys to a bitcoin wallet. That this only works in cases in which the loser has deleted some or all of their keys. A program usually can’t help those who have forgotten their passwords, PIN numbers, or backup seed phrases. But if the user mistakenly deleted files with the relevant information, they may be able to recover them. If a user has a portion of the private key, it may be possible to find the rest of the key. DARK TRACER DIGITAL is up for the Task to recover All stolen Asset