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> Everyone becomes worried about being able to extract money/value from the crypto ecosystem as a whole due Some of those "everyone" are people who live in cou
by anonymouskimmer 3y ago
> Everyone becomes worried about being able to extract money/value from the crypto ecosystem as a whole due
Some of those "everyone" are people who live in countries with both currency controls (so they can basically only buy their national currency, or cryptocurrencies), and a horribly inflating national currency. Even a non-exchangeable-for-fiat Bitcoin is better in their eyes than the only other alternative they have. No one wants to spend 100 trillion Zimbabwean dollars on a loaf of bread.
In the more stable world you'd need the failure/shutdown of exchanges approximately simultaneous with the strengthening of those national currencies. It might happen, but it'll be a while.
I'm anti-crypto, I just don't see it happening in the near term.
- lamontcg 3y ago> Some of those "everyone" are people who live in countries with both currency controls A minority of people flooding to the exits can easily remove all the liquid cash from the system and cause it to collapse. There's probably no more than around ten billion in cash at any one time supporting a nominally trillion dollar financial system. A 1% stampede for the exit can produce a crash by draining that liquidity to zero. And when the dust settles it will all have been a transfer of wealth from the poor to the rich.
- anonymouskimmer 3y agoIf you actually are using it as a currency, you don't need it to have any liquidity (with respect to exchanging it for another currency). You just need the person you're dealing with to prefer it to the alternative.