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IIRC this blog's 2022-11-04 article "Is Alameda Research Insolvent?" was a part of what kicked off the events leading to FTX's collapse: https://dirtybubblemedi

by eqmvii 4y ago

IIRC this blog's 2022-11-04 article "Is Alameda Research Insolvent?" was a part of what kicked off the events leading to FTX's collapse: https://dirtybubblemedia.substack.com/p/is-alameda-research-insolvent https://dirtybubblemedia.substack.com/p/is-alameda-research-...

perihelions 4y ago
Contemporary HN thread: https://news.ycombinator.com/item?id=33464494 https://news.ycombinator.com/item?id=33464494 (208 comments)
- tyleo 4y ago
  Wow, incredible to see all the top comments there, “This article is jumping to conclusions. Everything seems fine.” I’m not particularly invested in the crypto space one way or another but just watching from the sidelines it seems like: * Many things that seemed fine in this space were not fine. * As a layman, Binance _seems_ to be in the same ballpark of trustworthiness as FTX. Even if you are pro-crypto it just seems like there are much less risky places to put your money than Binance at this point.
  - roflyear 4y ago
    If you're invested in crypto, you need it to work out for you.
  - derivagral 4y ago
    As someone who loosely followed and played in the space, I got scared around when Binance set up their own non-eth chain and everyone just... was OK with it. I may recall wrong, but this stuff was "justified" because people didn't want to pay the fees and delays to trade on something like Uniswap. Funny, because BNB was one of my best investments at the time, making up for other counterparty risks I didn't avoid.
  - Analemma_ 4y ago
    The top comments did indeed say everything was fine, although to be fair, almost every single reply to those comments said the OP was full of shit, and gave reasons which turned out to be entirely correct. By comment volume, the skeptics were much more represented. So it seems like the population of HN has both a bunch of boosters who will blindly upvote plausible-sounding “everything is fine” positions but also a bunch of better-informed people who will do the work in tearing those boosters down.
    - burnished 4y ago
      If anything, upvoting controversial comments that have a lot of thoughtful responses is a public service - argument and counter argument gets put right at the top.
  - paulusthe 4y ago
    People who are heavily pro-crypto see any reporting of bad things as bad for adoption, and since adoption is the goal, the reporting is bad. They're willfully blind, and just like Elon, there's always somebody willing to parrot whatever they think Master wants them to say
    - toastercat 4y ago
      Reminds me of this quote by Drew DeVault: > Maybe your cryptocurrency is different. But look: you’re in really poor company. When you’re the only honest person in the room, maybe you should be in a different room. It is impossible to trust you. Every comment online about cryptocurrency is tainted by the fact that the commenter has probably invested thousands of dollars into a Ponzi scheme and is depending on your agreement to make their money back. [1] https://drewdevault.com/2021/04/26/Cryptocurrency-is-a-disaster.html https://drewdevault.com/2021/04/26/Cryptocurrency-is-a-disas...
      - yunohn 4y ago
        The irony is that every single crypto enthusiast I know, builder or speculator, has invested in shitcoins and scam coins just to hedge their bets in the off-chance it pumps… They’re fully aware and will tell me it’s shady, and yet, do it anyways.
    - yunohn 4y ago
      > adoption is the goal Absolutely, someone needs to fund the 100/1000x Ponzi returns that they want.
    - BLanen 4y ago
      Adoption(Actually using crypto as currency) is not in any way a goal anymore. The goal is now just to HODL till some mythical event where they'll be millionaires/billionaires with a single coin and then just use that as collateral to buy stuff through defi. Very similar to the GME cult.
  - kodah 4y ago
    From that thread: > If the liabilities are collateralized by assets on their balance sheet, then the financial risk is not to Alameda but the lender! Turns out the lender, illegally, was FTX
marban 4y ago
Feature of James Block https://www.theatlantic.com/technology/archive/2022/12/cryptocurrency-ftx-collapse-dirty-bubble-media/672440/ https://www.theatlantic.com/technology/archive/2022/12/crypt...
paulusthe 4y ago
Binance and tether have long been the dirtiest players in crypto, and there have been warning signs for years. Kindleberger likened financial frauds to underwater obstacles. When money is plentiful, the metaphorical tide is high, and the obstacles are hidden by the water so nobody sees them. But they're always there. Then, when the tide recedes (cheap money ends), the obstacles are exposed for all to see. Binance is just going to be the last domino to fall as a result of cheap money ending.
- tyleo 4y ago
  Another (more humorous) version of this metaphor is, “You don't find out who's been swimming naked until the tide goes out”
  - rabidonrails 4y ago
    That's a Buffet-ism

by eqmvii 4y ago

perihelions 4y ago

Contemporary HN thread: https://news.ycombinator.com/item?id=33464494 https://news.ycombinator.com/item?id=33464494 (208 comments)

tyleo 4y ago
Wow, incredible to see all the top comments there, “This article is jumping to conclusions. Everything seems fine.” I’m not particularly invested in the crypto space one way or another but just watching from the sidelines it seems like: * Many things that seemed fine in this space were not fine. * As a layman, Binance _seems_ to be in the same ballpark of trustworthiness as FTX. Even if you are pro-crypto it just seems like there are much less risky places to put your money than Binance at this point.
- roflyear 4y ago
  If you're invested in crypto, you need it to work out for you.
- derivagral 4y ago
  As someone who loosely followed and played in the space, I got scared around when Binance set up their own non-eth chain and everyone just... was OK with it. I may recall wrong, but this stuff was "justified" because people didn't want to pay the fees and delays to trade on something like Uniswap. Funny, because BNB was one of my best investments at the time, making up for other counterparty risks I didn't avoid.
- Analemma_ 4y ago
  The top comments did indeed say everything was fine, although to be fair, almost every single reply to those comments said the OP was full of shit, and gave reasons which turned out to be entirely correct. By comment volume, the skeptics were much more represented. So it seems like the population of HN has both a bunch of boosters who will blindly upvote plausible-sounding “everything is fine” positions but also a bunch of better-informed people who will do the work in tearing those boosters down.
  - burnished 4y ago
    If anything, upvoting controversial comments that have a lot of thoughtful responses is a public service - argument and counter argument gets put right at the top.
- paulusthe 4y ago
  People who are heavily pro-crypto see any reporting of bad things as bad for adoption, and since adoption is the goal, the reporting is bad. They're willfully blind, and just like Elon, there's always somebody willing to parrot whatever they think Master wants them to say
  - toastercat 4y ago
    Reminds me of this quote by Drew DeVault: > Maybe your cryptocurrency is different. But look: you’re in really poor company. When you’re the only honest person in the room, maybe you should be in a different room. It is impossible to trust you. Every comment online about cryptocurrency is tainted by the fact that the commenter has probably invested thousands of dollars into a Ponzi scheme and is depending on your agreement to make their money back. [1] https://drewdevault.com/2021/04/26/Cryptocurrency-is-a-disaster.html https://drewdevault.com/2021/04/26/Cryptocurrency-is-a-disas...
    - yunohn 4y ago
      The irony is that every single crypto enthusiast I know, builder or speculator, has invested in shitcoins and scam coins just to hedge their bets in the off-chance it pumps… They’re fully aware and will tell me it’s shady, and yet, do it anyways.
  - yunohn 4y ago
    > adoption is the goal Absolutely, someone needs to fund the 100/1000x Ponzi returns that they want.
  - BLanen 4y ago
    Adoption(Actually using crypto as currency) is not in any way a goal anymore. The goal is now just to HODL till some mythical event where they'll be millionaires/billionaires with a single coin and then just use that as collateral to buy stuff through defi. Very similar to the GME cult.
- kodah 4y ago
  From that thread: > If the liabilities are collateralized by assets on their balance sheet, then the financial risk is not to Alameda but the lender! Turns out the lender, illegally, was FTX

marban 4y ago

Feature of James Block https://www.theatlantic.com/technology/archive/2022/12/cryptocurrency-ftx-collapse-dirty-bubble-media/672440/ https://www.theatlantic.com/technology/archive/2022/12/crypt...

paulusthe 4y ago

Binance and tether have long been the dirtiest players in crypto, and there have been warning signs for years. Kindleberger likened financial frauds to underwater obstacles. When money is plentiful, the metaphorical tide is high, and the obstacles are hidden by the water so nobody sees them. But they're always there. Then, when the tide recedes (cheap money ends), the obstacles are exposed for all to see. Binance is just going to be the last domino to fall as a result of cheap money ending.

tyleo 4y ago
Another (more humorous) version of this metaphor is, “You don't find out who's been swimming naked until the tide goes out”
- rabidonrails 4y ago
  That's a Buffet-ism