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Its a pity that a decade and more of hyperactivity, speculation and noise in cryptofinance will not leave much to show for it but the smoldering ruins of bizarr

• Tyrek 3y ago
  It's difficult to claim that any system is 'certifiably broken' until you can actually point to an actual effective real-world implementation of a 'better system' (pareto or otherwise), no?
  • ouid 3y ago
    No. What? Say you're trying to invent a lightbulb. The first one ever, and it explodes when you plug it in. How would you describe its state?
    • hudon 3y ago
      "I have failed to invent a light bulb" Broken implies it was working to begin with, or can be compared to something that works, as the post you're replying to states.
      • ouid 3y ago
        No. Your attempt is now just shards of glass. It's borked. Before it was broken, it didn't work, but now its broken.
        • hudon 3y ago
          sure, but the thing that's broken was just that, a "thing". It wasn't a "lightbulb", because it was never able to produce light. It's a broken "bulb", at best, and that's a correct use of the word "broken", because it can be compared to other bulbs that aren't broken, in this case the glass bulb itself.
        • JAlexoid 3y ago
          Never having operated as desired and broken are different concepts. My square wheel isn't broken, because it's square.
          • ouid 3y ago
            Seems like you just didnt read what I wrote.
      • rchaud 3y ago
        Nobody knows what a lightbulb is as it hasn't been invented. What you did was fail to reinvent the candle.
        • ineedasername 3y ago
          I know what lots of things are that have yet to be invented. Space elevators and their variations, for example.
    • cheriot 3y ago
      Is the one we have not better than the ones that came before it? It's popular to look things like the gold standard through rose tinted glasses, but economic numbers don't support it.
    • bewaretheirs 3y ago
      Say you're selling a lightbulb and millions have bought it and then one day the millions of bulbs you've sold to millions of people all explode at the same time.
  • pjc50 3y ago
    Nah, it's definitely possible to point out failings in systems even before they're implemented, without having to prove that a better solution exists. It might not exist! You might just have to put up with an inadequate solution if it's better than nothing.
  • TheRealPomax 3y ago
    Nope. That's a really weird way to think about when you're allowed to call things broken. You can observe the effects, and with clear precision explain exactly what's broken just by looking at the thing itself.
  • wmf 3y ago
    Brazil has a better payment system than the US. Brazil!
    • hammyhavoc 3y ago
      Can you elaborate for the viewers at home in the UK?
      • nbeleski 3y ago
        Pix money transfer/payment system. Fully digital, easy to use, fast, cheap, available 24/7, launched by Brazil Central Bank and with massive adoption in the first year.
    • spiralx 3y ago
      The US financial infrastructure is remarkable in how far behind the rest of the world it is though, which is one of the reasons I think Bitcoin took off in the first place. Fast and free transfers of money never seemed quite so magical when every bank in your country already offered that service.
      • wmf 3y ago
        Bitcoin was about getting rich; using it for money transfers was just a fig leaf.
• DANmode 3y ago
  Do you separate the value of Bitcoin from the value of Binance, and Binance's coin?
  • Eisenstein 3y ago
    What is the value of Bitcoin if you can't separate it from its uses?
    • sph 3y ago
      What is the value of the dollar if you can't separate it from its uses? Bernie Madoff scammed people, so we should abolish the dollar. No money, no scams. This is the level of thinking of people crying about "crypto" in general. It's like saying "drugs are bad."
      • Eisenstein 3y ago
        I can buy groceries with dollars.
        • sph 3y ago
          If I open a vegetable stand and accept Bitcoin, what would be the difference? The reason why no one uses Bitcoin is because it's a nascent technology full of rough corners that needs to be smoothed out with time. Until a few months ago, it would've taken 15 minutes for the payment to go through. Is this reason enough to throw the baby out with the bathwater? But for some weird reason, many software engineers look at Bitcoin as a finished unchanging product. It is like looking at ARPANET and saying "this is bollocks, it's never gonna work." I guess drive-by criticism is less work than sitting down and improving something with is new, exciting, a bit crap but with huge potential.
          • Eisenstein 3y ago
            You can do whatever you want, it doesn't mean that Bitcoin is suddenly useful to people for grocery shopping just because you opened a stand. How do you plan to be profitable when the currency is constantly deflating? You presumably have to purchase your goods in USD, so any goods you sell have to be converted, which constantly loses money. No one is going to pay you in Bitcoin because they don't want their money to deflate. The cause of the thing is more than 'there are no shops'. There are no shops because no one wants to do it. Prove me wrong. Open a Bitcoin grocery store.
• boringg 3y ago
  It's a great use case for economics textbooks describing human-market behavior with modern technologies to help add fuel to the fire. It will replace tulip mania for a more recent experience. However the cost of that use-case was way to expensive for its net benefit.
  • WeylandYutani 3y ago
    It's intensely sobering isn't it? People haven't changed in 500 years. Still greedy. Still stupid. Still FOMO.
    • boringg 3y ago
      Very much so - people haven't changed since the Sumerian civilization was established. We get smarted but on a fundamental level we don't change. I've been listening to ancient civ podcasts and we do the same things we've always done. Sometimes more complicated, faster etc but its mostly the same. Science is a big differentiator - that said it gets used and abused in much the same way.
  • yieldcrv 3y ago
    alternatively, the tulip mania lasted for like 3 months, was also due to government regulations of the futures market, and there is no learning on what would have happened as the humans died due to the bubonic plague, so its the sort of the worst example of irrational exuberance despite its oft citing Bitcoin has a sustained 13 year wave, at far greater in amplitude than tulips, and spawned many bubbles along the way of even greater amplitude given the even shorter time periods, and now sustaining even during a period of quantitative tightening
    • boringg 3y ago
      Longer bigger cycles typically imply larger crashes.
• astoor 3y ago
  The irony is that Bitcoin was created in direct response to the perceived shortcomings of the traditional financial system (see the message in the genesis block), but since then the traditional financial system has cleaned itself up enormously, while cryptocurrency has had the exact opposite trajectory and is now nothing more than a magnet for actual or latent fraudsters.
  • pjc50 3y ago
    Bitcoin addressed at most one issue in finance, without properly tying it to the financial crisis, and since then has reinvented all the others in a massive Chesterton's Fence speedrun. It's been nothing but "oh, so that's why the rules are that way" since then.
    • freeAgent 3y ago
      I’d say that Bitcoin itself has been operating pretty well, minus the stupid decision to keep the block size cap in the single-digit MBs that has created tx congestion and excessive fee competition (BCH fixed that, thankfully). The problem with cryptocurrency is simply that it’s attracting to frauds, and is dominated by fraud and get-rich-quick gambling/speculation. It’s attractive to fraud for the same reasons why it’s attractive to people who take issue with legacy finance. Your “account” (wallet) can’t really be shut down or frozen, you can transact quickly and easily with only an internet connection and a phone regardless of borders or capital controls, and the currency itself can be audited and resists inflation. All those things continue to be true, but unfortunately the current largest, visible use case is fraud. The original use case for Bitcoin was right in the title of the white paper: P2P electronic cash. Unfortunately, that hasn’t taken off, and some governments like the US have done their best to kill it. See the IRS guidance for Bitcoin taxes from 2013 which made it practically impossible to use as cash in a legally compliant way. That was the first, and clearest, regulation of cryptocurrency I’m aware of. All other currencies are treated differently. Only Bitcoin/cryptocurrency was singled out for particularly onerous tax treatment.
      • tsimionescu 3y ago
• rohith2506 3y ago
  Sitting on the sidelines, It makes us feel superior to criticise and derive intellectual pleasure out of that but I haven't seen a lot of people who actually step into the ring and try to fix what's broken. I was one of them. We can all agree that the current traditional and digital finance systems are broken but I don't see any solutions being provided as an alternative. In every industry which involves innovation, there will be speculation and definitely people who like to profit off that which results in ponzi schemes but in the end, there are some genuinely hard working people who truly believe in the mission they signed up for 10 years ago and still continue to work. I would suggest you to take a look around and dig deeper into some of the blockchain projects and you will understand how much blood, sweat and bits have been poured into this.
  • cube2222 3y ago
    > We can all agree that the current traditional and digital finance systems are broken [...] Could you expand on that? That's quite a strong opinion to assume everybody agrees on.
    • pixelpoet 3y ago
      Bailing out Too-Big-To-Fail banks which privatise profits and socialise losses on increasingly abstract / difficult to understand financial instruments springs to mind.
      • cube2222 3y ago
        If you're talking about the recent bank failures, that was in fact covered by other banks, no? It was not paid for by tax payers. While the recent losses were in big part because of bonds and currency rate risk, so not a particularly abstract or difficult to understand instrument. Not that being hard to understand is a bad thing. Something can be complex and still valuable.
      • seanhunter 3y ago
        And those problems are solved by crypto because… ?
• JeremyNT 3y ago
  > Its a pity that a decade and more of hypeactivity, speculation and noise in cryptofinance will not leave much to show for it but the smoldering ruins of bizzare house-of-cards. Weirdly, there's still plenty of speculation in this space, and still plenty of people getting rich off of it. Look at the price of bitcoin for example, it's rebounded substantially since the FTX collapse. People have become millionaires from this nonsense and a great many people seem to feel like there's still a lot of value. I just don't understand it at all at this point. I understand how people would have been duped by the scams before all of the prominent failures, but why are people still willing to trade crypto for so much actual money?
  • dragontamer 3y ago
    > it's rebounded substantially since the FTX collapse Who cares about the price? Seriously. Its not that important. What are the systems in place to prevent another FTX-like collapse in the bitcoin space? Answer: None. In fact, Tether remains a fully unaudited, potential house-of-cards, situation. People aren't worried about the price going up or down. Its really not that important. People are worried about losing $X0,000+ as the next random exchange or cryptocoin-service collapses randomly. It has become abundantly clear that not only is cryptocoin vulnerable to incredible collapses of financial services... but the cryptocoin community is wholly uninterested in solving that problem. Mt. Gox collapsed. Celsius collapsed. Voyager collapsed. FTX collapsed. Each situation, individuals lost anywhere from thousands, to millions, of dollars in one fell swoop. ------- Meanwhile, every SIVB and First Republic Bank customer has been made whole. Yes, the banks collapsed, but no one actually lost any money over it. In fact, the mainstream banking collapses occurred over the weekend (when the banks were closed anyway), and everything was fixed by Monday Morning. I'm not necessarily saying that an "FDIC-of-cryptocoins" needs to be setup. But the cryptocoin community needs to come together and figure this crap out... how to provide assurances to the public that these systems are safe and worth using.
    • mrguyorama 3y ago
      >but the cryptocoin community is wholly uninterested in solving that problem. Because it isn't a problem to them. By and large, the people running sketchy "exchanges" and crypto companies make shitloads of money even as their "business" fails. SBF only went to jail because he is a sociopath that's never been punished in his life, and thinks he can do no wrong.
• deleted 3y ago
  [deleted]
• olalonde 3y ago
  > We have financial systems that are certifiably broken, there are countless ideas about how to fix them You can trace back almost everything that is broken in financial systems to government regulations. It's not a technical problem. The only technical solution is to build a decentralized system that is difficult to regulate (aka Bitcoin). Its "economic objective" is to replace those traditional systems.
  • mrguyorama 3y ago
    Ah yes, not like we have tried to deregulate finance in any way and had three "once in a generation" economic events in 20 years. Maybe, just maybe, the damn actor from california didn't know much about economics? Nah, obviously fintech just wasn't free enough to explore weird money games!
• RestlessMind 3y ago
  I hate scammers in the crypto space as much as anyone else. And it feels good at some level to see them getting flushed out in the current environment. Having said that > cryptofinance will not leave much to show for it I completely disagree with this. I can confidently bet that Bitcoin's price will cross 50K USD in the next 5 years, and 100K in the next 10 years. I am personally putting my money where my mouth is.
• aww_dang 3y ago
  The financialization of the economy is downstream from central bank policy. You cannot divorce the existing financial system from cryptocurrency. Rampant speculation and bubble mania isn't happening in a vacuum. Rather, it is a symptom of easy money and cheap credit. When regulators remove barriers to a natural rate of credit by no longer centrally planning interest rates, speculative mania will be naturally disincentivized.
• amadeuspagel 3y ago
  It's curious to make this connection between lack of innovation in the financial system and bitcoin. Maybe there's no innovation in the financial system because that system lacks competitors? Or because there's no way to try things out? Bitcoin should help either way. There's some movement towards Fed bank accounts, and I expect Bitcoin to help there — if there's a serious threat of Bitcoin replacing the US dollar, then maybe the interests of banks will seem less important.