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Crypto exchanges certainly seem to be geared towards fraudulent activities, and they've lured investors in with promises of high returns. The whole so-called '

Crypto exchanges certainly seem to be geared towards fraudulent activities, and they've lured investors in with promises of high returns. The whole so-called 'decentralized finance' world (DeFi) seems to be full of shady actors and money-launderers, but cryptocurrencies themselves - when no used in the way, say, that subprime mortgages were - as vehicles for gambling - don't seem to be inherently corrupt. FTX/Alameda is now the poster child for Defi, isn't it? Good overview here: https://blockcast.cc/news/revealing-the-new-defi-gang-ftx-and-the-expansion-of-alameda/ https://blockcast.cc/news/revealing-the-new-defi-gang-ftx-an...

ditonal 4y ago
The poster child for DeFi was never a CEX. The obvious poster child for decentralized finance would be the biggest decentralized exchange in the world , Uniswap. I recognize there are tons of fraudsters who latch onto the vocabulary of cryptocurrency and twist it to trick naive consumers who don’t know the difference. Another example would be “staking” where the original intent meant earning proof of stake rewards without giving up your keys, but was frequently used as a marketing term for things like Blockfi where you literally transferred ownership if your coins. Despite the manipulation around the terms, it’s unfortunate how a fairly technical audience like Hacker News refuses to have good faith discussions around this. This crowd should know better than to call FTX DeFi. This crowd should know better than to call fractional reserve interest programs staking. I think this crowd does know the difference but chooses to ignore it in bad faith because of a general dislike of cryptocurrencies. By all means call out the swindlers but a site called hacker news deserves better when it comes to using technical terms accurate and in good faith. And by calling FTX DeFi you’re doing neither.
- bb88 4y ago
  FTX was working on DeFi with their Serum protocol. [1], [2] Serum was meant to compete with Uniswap. [6] Oxygen and Solana DeFi tokens were working with FTX on Serum. [3], [4] Now that FTX has failed, people are saying "FTX was never a De-Fi". We should stop calling it that because if we do we're now "dishonest". [you and 5] [1] https://www.projectserum.com https://www.projectserum.com [2] https://cryptopotato.com/serum-srm-backs-community-hard-fork-plans-after-ftx-collapse/ https://cryptopotato.com/serum-srm-backs-community-hard-fork... [3] https://decrypt.co/116652/ftx-solana-defi-serum-starting-over https://decrypt.co/116652/ftx-solana-defi-serum-starting-ove... [4] https://cryptoslate.com/defi-protocol-oxygen-held-95-of-supply-on-ftx/ https://cryptoslate.com/defi-protocol-oxygen-held-95-of-supp... [5] https://www.rebellionresearch.com/is-ftx-a-defi https://www.rebellionresearch.com/is-ftx-a-defi [6] https://www.coindesk.com/markets/2021/04/28/serum-token-becomes-latest-project-in-bankman-fried-empire-to-turn-heads/ https://www.coindesk.com/markets/2021/04/28/serum-token-beco...
  - IncRnd 4y ago
    These intellectual contortions are great for creating clever arguments, but the entirety of the thefts that were done could only have happened due to centralization. Being a centralization of crypto, FTX was absolutely not and could not have been DeFi. No exchange that centralizes actions, tokens, and crypto is DeFi - even though protocols may appear decentralized.
  - dlubarov 4y ago
    I think the point is that what happened with FTX couldn't plausibly happen with a real DeFi protocol like Uniswap. FTX might have had ties to some real DeFi protocols, but that seems unrelated to what happened. FTX's collapse doesn't make them bad by association, just as SBF's shenannigans don't make veganism bad by association. Serum seems like a special case - it was branded as a DeFi protocol, but wasn't really decentralized, since FTX had sole upgrade authority. Because of that Serum collapsed when FTX did. That couldn't happen with something like Uniswap, where governance is actually decentralized.
    - bb88 4y ago
      I think my point is, don't blame us for getting the nomenclature wrong, when it's clear that the crypto people were smearing the nomenclature around too like a cheap maple syrup, letting it stick to anything that looked "defi-ish" Now only after FTX failed people are saying, "Oh that wasn't really defi, and you're being dishonest if you call it that." Basically we're being gaslit after the fact.
      - dlubarov 4y ago
        Point taken. It depends who you listen to though. In the right circles, there are plenty of thoughtful discussions about the (de)centralization of protocols (that haven't imploded). See [1] just as an example. But yes, in other circles, there are "crypto personalities" who cater to an audience that's just hoping to get rich quick. Such people usually don't know or don't care about things like contract upgrade mechanisms. [1] https://www.youtube.com/watch?v=HO693GJZITY https://www.youtube.com/watch?v=HO693GJZITY
bb88 4y ago
> ...don't seem to be inherently corrupt. That's kinda like saying the Mafia could be good if it weren't for all the bad actors. At some point the Mafia itself becomes bad and then becomes the reason someone joins it -- to be paid handsomely for committing crimes. That's I think where we're at with crypto.
- helloworld11 4y ago
  It's absurd but increasingly common to see such bad, ignorant metaphors of technologies used by people with en emotional vitriol on a site like HN. The mafia is a emphatically criminal organization made up of people whose unique and specific purpose is to extort, rob, threaten, kill and steal as their core activities. Crypto is a bundle of interrelated technologies and cryptographic protocols that can be used for bad, good or neutral purposes by humans with all kinds of agendas. In the case of decentralized cryptocurrencies like bitcoin, nobody's even in specific control and claiming they're evil is like claiming a random algorithm is evil, or that encryption is evil because alongside dissidents and social activists, pedophiles and con men also use it to keep their communication private. Ridiculous.
tablespoon 4y ago
> but cryptocurrencies themselves - when no used in the way, say, that subprime mortgages were - as vehicles for gambling - don't seem to be inherently corrupt. If you take away gambling and speculation, cryptocurrencies lack a compelling use case when compared to competing technologies.
- eric_cc 4y ago
  What technology is better at being money than bitcoin? Paper dollar?
  - tablespoon 4y ago
    > What technology is better at being money than bitcoin? Paper dollar? Pretty much anything? (including cowrie shells and gold) Bitcoin has a lot of hype about being "money," but it's rarely used as such.
    - eric_cc 4y ago
      This is a very dishonest or ignorant response. Good luck sending somebody shells or gold to make a payment. And good luck with shell inflation. And good luck with every store needing to be able to test that gold is real, store it in vaults, etc
      - IncRnd 4y ago
        > Good luck sending somebody shells or gold to make a payment. Good luck sending somebody crypto to make a payment.
        eric_cc 4y ago
        It’s a common occurrence. No luck needed.
        IncRnd 4y ago

ditonal 4y ago

The poster child for DeFi was never a CEX. The obvious poster child for decentralized finance would be the biggest decentralized exchange in the world , Uniswap. I recognize there are tons of fraudsters who latch onto the vocabulary of cryptocurrency and twist it to trick naive consumers who don’t know the difference. Another example would be “staking” where the original intent meant earning proof of stake rewards without giving up your keys, but was frequently used as a marketing term for things like Blockfi where you literally transferred ownership if your coins. Despite the manipulation around the terms, it’s unfortunate how a fairly technical audience like Hacker News refuses to have good faith discussions around this. This crowd should know better than to call FTX DeFi. This crowd should know better than to call fractional reserve interest programs staking. I think this crowd does know the difference but chooses to ignore it in bad faith because of a general dislike of cryptocurrencies. By all means call out the swindlers but a site called hacker news deserves better when it comes to using technical terms accurate and in good faith. And by calling FTX DeFi you’re doing neither.

bb88 4y ago
FTX was working on DeFi with their Serum protocol. [1], [2] Serum was meant to compete with Uniswap. [6] Oxygen and Solana DeFi tokens were working with FTX on Serum. [3], [4] Now that FTX has failed, people are saying "FTX was never a De-Fi". We should stop calling it that because if we do we're now "dishonest". [you and 5] [1] https://www.projectserum.com https://www.projectserum.com [2] https://cryptopotato.com/serum-srm-backs-community-hard-fork-plans-after-ftx-collapse/ https://cryptopotato.com/serum-srm-backs-community-hard-fork... [3] https://decrypt.co/116652/ftx-solana-defi-serum-starting-over https://decrypt.co/116652/ftx-solana-defi-serum-starting-ove... [4] https://cryptoslate.com/defi-protocol-oxygen-held-95-of-supply-on-ftx/ https://cryptoslate.com/defi-protocol-oxygen-held-95-of-supp... [5] https://www.rebellionresearch.com/is-ftx-a-defi https://www.rebellionresearch.com/is-ftx-a-defi [6] https://www.coindesk.com/markets/2021/04/28/serum-token-becomes-latest-project-in-bankman-fried-empire-to-turn-heads/ https://www.coindesk.com/markets/2021/04/28/serum-token-beco...
- IncRnd 4y ago
  These intellectual contortions are great for creating clever arguments, but the entirety of the thefts that were done could only have happened due to centralization. Being a centralization of crypto, FTX was absolutely not and could not have been DeFi. No exchange that centralizes actions, tokens, and crypto is DeFi - even though protocols may appear decentralized.
- dlubarov 4y ago
  I think the point is that what happened with FTX couldn't plausibly happen with a real DeFi protocol like Uniswap. FTX might have had ties to some real DeFi protocols, but that seems unrelated to what happened. FTX's collapse doesn't make them bad by association, just as SBF's shenannigans don't make veganism bad by association. Serum seems like a special case - it was branded as a DeFi protocol, but wasn't really decentralized, since FTX had sole upgrade authority. Because of that Serum collapsed when FTX did. That couldn't happen with something like Uniswap, where governance is actually decentralized.
  - bb88 4y ago
    I think my point is, don't blame us for getting the nomenclature wrong, when it's clear that the crypto people were smearing the nomenclature around too like a cheap maple syrup, letting it stick to anything that looked "defi-ish" Now only after FTX failed people are saying, "Oh that wasn't really defi, and you're being dishonest if you call it that." Basically we're being gaslit after the fact.
    - dlubarov 4y ago
      Point taken. It depends who you listen to though. In the right circles, there are plenty of thoughtful discussions about the (de)centralization of protocols (that haven't imploded). See [1] just as an example. But yes, in other circles, there are "crypto personalities" who cater to an audience that's just hoping to get rich quick. Such people usually don't know or don't care about things like contract upgrade mechanisms. [1] https://www.youtube.com/watch?v=HO693GJZITY https://www.youtube.com/watch?v=HO693GJZITY

bb88 4y ago

> ...don't seem to be inherently corrupt. That's kinda like saying the Mafia could be good if it weren't for all the bad actors. At some point the Mafia itself becomes bad and then becomes the reason someone joins it -- to be paid handsomely for committing crimes. That's I think where we're at with crypto.

helloworld11 4y ago
It's absurd but increasingly common to see such bad, ignorant metaphors of technologies used by people with en emotional vitriol on a site like HN. The mafia is a emphatically criminal organization made up of people whose unique and specific purpose is to extort, rob, threaten, kill and steal as their core activities. Crypto is a bundle of interrelated technologies and cryptographic protocols that can be used for bad, good or neutral purposes by humans with all kinds of agendas. In the case of decentralized cryptocurrencies like bitcoin, nobody's even in specific control and claiming they're evil is like claiming a random algorithm is evil, or that encryption is evil because alongside dissidents and social activists, pedophiles and con men also use it to keep their communication private. Ridiculous.

tablespoon 4y ago

> but cryptocurrencies themselves - when no used in the way, say, that subprime mortgages were - as vehicles for gambling - don't seem to be inherently corrupt. If you take away gambling and speculation, cryptocurrencies lack a compelling use case when compared to competing technologies.

eric_cc 4y ago
What technology is better at being money than bitcoin? Paper dollar?
- tablespoon 4y ago
  > What technology is better at being money than bitcoin? Paper dollar? Pretty much anything? (including cowrie shells and gold) Bitcoin has a lot of hype about being "money," but it's rarely used as such.
  - eric_cc 4y ago
    This is a very dishonest or ignorant response. Good luck sending somebody shells or gold to make a payment. And good luck with shell inflation. And good luck with every store needing to be able to test that gold is real, store it in vaults, etc
    - IncRnd 4y ago
      > Good luck sending somebody shells or gold to make a payment. Good luck sending somebody crypto to make a payment.
      - eric_cc 4y ago
        It’s a common occurrence. No luck needed.
        IncRnd 4y ago