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I make financial decisions based on the value of my pension, which could theoretically go to zero. Yes there's risk, but to not make a decision based on it is a

I make financial decisions based on the value of my pension, which could theoretically go to zero. Yes there's risk, but to not make a decision based on it is another kind of risk. This is all to skip over the fact that you may have "cashed out" the risky bit back into dollars and, rightly so, think you were very low risk at that point.

nradov 3y ago
Come on. It's disingenuous to compare an obvious scam like cryptocurrency with a pension. The levels of risk are orders of magnitude different. And in the USA at least, most pensions are insured by the PBGC so they can't literally go to zero even if the sponsoring company fails.
- danpalmer 3y ago
  I think it's disingenuous to call all cryptocurrency a "scam". There are a lot of scams, I won't touch the industry for work or investment, but otherwise it is just betting like any other investment, just a highly volatile one. When I say pensions, I'm thinking specifically about invested pensions (typical for UK private pensions which is what I'm familiar with). Insurance might cover the pension company failing, but I would assume they don't cover the shares your pension is invested in going down in value. Are the risks an order of magnitude different? Maybe, depends what's being compared. Is there a difference between day trading crypto and day trading stocks? Probably much less of a difference. The important thing though is that the dimension of risk is in terms of your gains and losses on the assets – that's what people understand, that's what can be modelled etc. Most people are not considering their banking infrastructure to be part of the risk, and most of the time it isn't, because it's illegal to mess with peoples money like FTX did.
- tombert 3y ago
  (disclaimer: this is coming from a guy who is very embarrassed to have put any money into cryptocurrency and I do think it's stupid now). I mean, if you were buying crypto shitcoins expecting to make a quick buck, then obviously yeah that's pretty scammy and not comparable to a pension. However, the way companies like Gemini/Coinbase/FTX/Kraken operate, they treat certain coins like they're a long term investment, like digital gold. I bought into GUSD with Gemini Earn because I believed the bullshit that it was FDIC-insured and was paying ridiculously high interest in the process, and that the funds were backed up one-to-one with regular US dollars. Was I stupid for believing that? Yeah, sure, I don't dispute that, but I think that's a little different than a claim of "MAKE A MILLION DOLLARS RIGHT AWAY WITH DOGECOIN AND BOREDAPES!!!1!!". The brilliance of the GUSD Gemini Earn scam was that it was good interest, but not necessarily "too good to be true" interest. I think it's a less-obvious scam, at least, and the way it was marketed was acting like it was competing with savings accounts. I don't have a pension, but there are plenty of investment-retirement things in the US, and it's not like it's impossible to have scams on the regular stock market. Hell, the ETF that I buy most often is VTI, which invests in every publicly traded company, including but not limited scammy penny stocks, or even non-penny-stock scams like Nikola.

nradov 3y ago

Come on. It's disingenuous to compare an obvious scam like cryptocurrency with a pension. The levels of risk are orders of magnitude different. And in the USA at least, most pensions are insured by the PBGC so they can't literally go to zero even if the sponsoring company fails.

danpalmer 3y ago
I think it's disingenuous to call all cryptocurrency a "scam". There are a lot of scams, I won't touch the industry for work or investment, but otherwise it is just betting like any other investment, just a highly volatile one. When I say pensions, I'm thinking specifically about invested pensions (typical for UK private pensions which is what I'm familiar with). Insurance might cover the pension company failing, but I would assume they don't cover the shares your pension is invested in going down in value. Are the risks an order of magnitude different? Maybe, depends what's being compared. Is there a difference between day trading crypto and day trading stocks? Probably much less of a difference. The important thing though is that the dimension of risk is in terms of your gains and losses on the assets – that's what people understand, that's what can be modelled etc. Most people are not considering their banking infrastructure to be part of the risk, and most of the time it isn't, because it's illegal to mess with peoples money like FTX did.
tombert 3y ago
(disclaimer: this is coming from a guy who is very embarrassed to have put any money into cryptocurrency and I do think it's stupid now). I mean, if you were buying crypto shitcoins expecting to make a quick buck, then obviously yeah that's pretty scammy and not comparable to a pension. However, the way companies like Gemini/Coinbase/FTX/Kraken operate, they treat certain coins like they're a long term investment, like digital gold. I bought into GUSD with Gemini Earn because I believed the bullshit that it was FDIC-insured and was paying ridiculously high interest in the process, and that the funds were backed up one-to-one with regular US dollars. Was I stupid for believing that? Yeah, sure, I don't dispute that, but I think that's a little different than a claim of "MAKE A MILLION DOLLARS RIGHT AWAY WITH DOGECOIN AND BOREDAPES!!!1!!". The brilliance of the GUSD Gemini Earn scam was that it was good interest, but not necessarily "too good to be true" interest. I think it's a less-obvious scam, at least, and the way it was marketed was acting like it was competing with savings accounts. I don't have a pension, but there are plenty of investment-retirement things in the US, and it's not like it's impossible to have scams on the regular stock market. Hell, the ETF that I buy most often is VTI, which invests in every publicly traded company, including but not limited scammy penny stocks, or even non-penny-stock scams like Nikola.