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A person I consider trustworthy is convinced crypto will face a systemic risk

31 points by ignoramous 4y ago

baby 4y ago
What’s a “systemic risk”? It’s hard to understand this tweet. It’s so vague and written by someone who probably doesn’t understand much about the tech stack of blockchains
- aeturnum 4y ago
  I mean, it's intentionally vague - but considering the source and his social network, I suspect the idea is that PG's trusted source has knowledge of some forthcoming challenge to the fundamental axioms of the current crypto ecosystem. Maybe there's some flaw in Eth's PoS implementation, or maybe Tether is going to collapse or...I mean, pick anything? How seriously you take this is kind of up to you. I personally don't trust PG one bit - nor do I own a significant[1] amount of crypto - so I won't change anything. [1] Like many people I have bits here and there from checking it out but nothing material to my overall wealth.
- paleotrope 4y ago
  There should be a devil's dictionary entry for "systemic" or "systematic" or related terms like "structural"
googlryas 4y ago
Is that really the first person Paul trusted to ever tell him this? There have been sophisticated, intelligent, nuanced crypto bears for about as long as there has been crypto.
- readthenotes1 4y ago
  What doesn't have systemic risk?
cassianoleal 4y ago
He follows this tweet with another saying: "I didn't write that. He did. Since I don't know any details, I didn't feel I should edit it. And because I don't know any details, it's no use asking me what he means. If you've read the preceding tweet, you know as much as I do." So this is a rumour about nothing, spread by Paul Graham but blaming a supposed nameless third-party.
- chrisfosterelli 4y ago
  Yeah. Seems like a shower thought from Paul. Sure, that's his twitter feed and up to him what he shares but hardly HN worthy.
ProjectArcturis 4y ago
I mean... Duh? Like, crypto is facing a systematic risk right now, obviously and publicly. It's like we're standing outside a building with flames coming out the windows and some VC guy comes along and passes us a hot tip that the building has a high fire risk.
Eduard 4y ago
> "A person I consider trustworthy is convinced crypto will face a systemic risk" makes a great addition to the "Hacker News Parody Thread" submission trending today ( http://bradconte.com/files/misc/HackerNewsParodyThread/ http://bradconte.com/files/misc/HackerNewsParodyThread/ ).
TacticalCoder 4y ago
Well the crypto HN unicorn is Coinbase. They seem legit but they're bleeding money and atm not only the free money lunch is over but also nobody in their right mind want to invest in a crypto company. Then Coinbase has a very serious issue: legislators already said that should Coinbase go belly up, the actual tens of billions backing the USCD (Coinbase's stable coin) could be seized to reimburse the investors first. So, knowing that, who is going to use Coinbase's stable coin? Knowing that at any time the rug can be pulled under your feet. Even if they're legit they're walking on extremely thin ice. Then there's the issue of Coinbase, for whatever reason, having pairs trading in USDT (the ultimate scam). And Coinbase is also guilty of having listed several of the pump and dumped shitcoins of SBF's creation. Sticking to BTC / ETH and actually backing USDC 1:1 without using the funds to bail out investors first was too much to ask?
- baby 4y ago
  How are they bleeding money? I would expect that they would make a ton of money from their trading fees
- TaylorPhebillo 4y ago
  I see [1] speculate that Coinbase users could be considered unsecured general creditors, and therefore lower priority to repay than secured creditors. That does seem bad on it's own. But nothing about equity investors having higher priority on funds. Is there some extra subtlety around e.g. shares being convertible into debt or something weird? [1] https://www.bloomberg.com/news/articles/2022-05-11/coinbase-gives-256-billion-reminder-about-agonies-of-bankruptcy https://www.bloomberg.com/news/articles/2022-05-11/coinbase-...
  - dzamo_norton 4y ago
    Shareholders are at the back of the queue in a bankruptcy.
donsupreme 4y ago
PG's tweet is flagged ... why?
- tchock23 4y ago
  First three comments were from crypto apologists who promptly flagged it.
- gus_massa 4y ago
  You can ask the mods, but the answer is probably something boring like: fake quote> Some users flagged it, and pg does not have any special treatment here. The mod may decide to remove the flag. In my opinion it's too vague, but I don't have any cryptocoins to worry about.
- breck 4y ago
- baby 4y ago
  I flagged it because there’s no content to discuss here
  - boxed 4y ago
    Good call
shl0ms 4y ago
[scene: prominent VC tweeting 2 weeks after Lehman collapse] A person I have known for more than ten years, who I consider trustworthy, is convinced the economy will shortly experience a systemic risk. I don’t know anything concrete, but if I were exposed, I would be concerned.
bananapub 4y ago
It’s going to be pretty sickening to have to listen to Paul and the other appalling VC people who helped enable all this nonsense once it collapses. They’ll say they didn’t know, but of course what they mean is they didn’t care.
breck 4y ago
I mean crypto always faces systemic risks. Anyone who isn't planning for the possibility of crypto to visit near zero (before going back up, either in these chains or on new chains) is not being careful enough. In the short run it could go down another >99%, or back up 20x. Who knows. That doesn't matter because in the long run: https://www.youtube.com/watch?v=Wt465BEXRkE https://www.youtube.com/watch?v=Wt465BEXRkE https://sellnothing.com/ https://sellnothing.com/

31 points by ignoramous 4y ago

baby 4y ago

What’s a “systemic risk”? It’s hard to understand this tweet. It’s so vague and written by someone who probably doesn’t understand much about the tech stack of blockchains

aeturnum 4y ago
I mean, it's intentionally vague - but considering the source and his social network, I suspect the idea is that PG's trusted source has knowledge of some forthcoming challenge to the fundamental axioms of the current crypto ecosystem. Maybe there's some flaw in Eth's PoS implementation, or maybe Tether is going to collapse or...I mean, pick anything? How seriously you take this is kind of up to you. I personally don't trust PG one bit - nor do I own a significant[1] amount of crypto - so I won't change anything. [1] Like many people I have bits here and there from checking it out but nothing material to my overall wealth.
paleotrope 4y ago
There should be a devil's dictionary entry for "systemic" or "systematic" or related terms like "structural"

googlryas 4y ago

Is that really the first person Paul trusted to ever tell him this? There have been sophisticated, intelligent, nuanced crypto bears for about as long as there has been crypto.

readthenotes1 4y ago
What doesn't have systemic risk?

cassianoleal 4y ago

He follows this tweet with another saying: "I didn't write that. He did. Since I don't know any details, I didn't feel I should edit it. And because I don't know any details, it's no use asking me what he means. If you've read the preceding tweet, you know as much as I do." So this is a rumour about nothing, spread by Paul Graham but blaming a supposed nameless third-party.

chrisfosterelli 4y ago
Yeah. Seems like a shower thought from Paul. Sure, that's his twitter feed and up to him what he shares but hardly HN worthy.

ProjectArcturis 4y ago

I mean... Duh? Like, crypto is facing a systematic risk right now, obviously and publicly. It's like we're standing outside a building with flames coming out the windows and some VC guy comes along and passes us a hot tip that the building has a high fire risk.

Eduard 4y ago

> "A person I consider trustworthy is convinced crypto will face a systemic risk" makes a great addition to the "Hacker News Parody Thread" submission trending today ( http://bradconte.com/files/misc/HackerNewsParodyThread/ http://bradconte.com/files/misc/HackerNewsParodyThread/ ).

TacticalCoder 4y ago

Well the crypto HN unicorn is Coinbase. They seem legit but they're bleeding money and atm not only the free money lunch is over but also nobody in their right mind want to invest in a crypto company. Then Coinbase has a very serious issue: legislators already said that should Coinbase go belly up, the actual tens of billions backing the USCD (Coinbase's stable coin) could be seized to reimburse the investors first. So, knowing that, who is going to use Coinbase's stable coin? Knowing that at any time the rug can be pulled under your feet. Even if they're legit they're walking on extremely thin ice. Then there's the issue of Coinbase, for whatever reason, having pairs trading in USDT (the ultimate scam). And Coinbase is also guilty of having listed several of the pump and dumped shitcoins of SBF's creation. Sticking to BTC / ETH and actually backing USDC 1:1 without using the funds to bail out investors first was too much to ask?

baby 4y ago
How are they bleeding money? I would expect that they would make a ton of money from their trading fees
TaylorPhebillo 4y ago
I see [1] speculate that Coinbase users could be considered unsecured general creditors, and therefore lower priority to repay than secured creditors. That does seem bad on it's own. But nothing about equity investors having higher priority on funds. Is there some extra subtlety around e.g. shares being convertible into debt or something weird? [1] https://www.bloomberg.com/news/articles/2022-05-11/coinbase-gives-256-billion-reminder-about-agonies-of-bankruptcy https://www.bloomberg.com/news/articles/2022-05-11/coinbase-...
- dzamo_norton 4y ago
  Shareholders are at the back of the queue in a bankruptcy.

donsupreme 4y ago

PG's tweet is flagged ... why?

tchock23 4y ago
First three comments were from crypto apologists who promptly flagged it.
gus_massa 4y ago
You can ask the mods, but the answer is probably something boring like: fake quote> Some users flagged it, and pg does not have any special treatment here. The mod may decide to remove the flag. In my opinion it's too vague, but I don't have any cryptocoins to worry about.
breck 4y ago
baby 4y ago
I flagged it because there’s no content to discuss here
- boxed 4y ago
  Good call

shl0ms 4y ago

[scene: prominent VC tweeting 2 weeks after Lehman collapse] A person I have known for more than ten years, who I consider trustworthy, is convinced the economy will shortly experience a systemic risk. I don’t know anything concrete, but if I were exposed, I would be concerned.

bananapub 4y ago

It’s going to be pretty sickening to have to listen to Paul and the other appalling VC people who helped enable all this nonsense once it collapses. They’ll say they didn’t know, but of course what they mean is they didn’t care.

breck 4y ago

I mean crypto always faces systemic risks. Anyone who isn't planning for the possibility of crypto to visit near zero (before going back up, either in these chains or on new chains) is not being careful enough. In the short run it could go down another >99%, or back up 20x. Who knows. That doesn't matter because in the long run: https://www.youtube.com/watch?v=Wt465BEXRkE https://www.youtube.com/watch?v=Wt465BEXRkE https://sellnothing.com/ https://sellnothing.com/