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I can't believe people entrust virtual money to sites like these which in general - but consistently - seem to be run by amateurs.

by 0x0 14y ago

sneak 14y ago
People still regularly fall for 419 scams, or the emails would stop. I got one the other day for a "scam victim restitution fund", asking for personal details. The mind reels.
astrodust 14y ago
Like smokers they often believe "it won't happen to them".
wmf 14y ago
AFAIK Bitcoinica was the only site offering BTC derivatives, so presumably some people figured the potential profit was worth the risk. More generally, all Bitcoin exchanges seem to be run by amateurs, so people have to deal with them to cash out.
- 0x0 14y ago
  I wonder why. There seems to be a huge gap in the market for a professionally run enterprise here. Or at least, anything more focused beyond students half-assing it part-time.
  - wmf 14y ago
    Bitcoin market activity may not be large enough to ever pay back the significant cost of building a secure exchange. Also, as TradeHill and CampBX discovered, people just won't move off of MtGox no matter how bad it is.
    - ScottBurson 14y ago
      People won't move off of MtGox for a simple reason: it has by far the best liquidity. The only way for another exchange to get a foothold would be to offer similar liquidity, which would mean taking the other side of most trades themselves. This would be very risky and they would need deep pockets.
- jonhendry 14y ago
  Derivatives as in options/futures/swaps/even more exotic? That is quite possibly the scariest financial product ever devised, assuming there was nobody putting together complex products based on Zimbabwean currency during their period of massive inflation.
makomk 14y ago
Right now, as we speak, Bitcoin users are entrusting their money to an investment scheme that has all the hallmarks of a Ponzi[1]. We're talking 9% monthly interest if you invest enough bitcoins, utterly implausible explanations as to what the money's being invested in, a seemingly limitless capacity to swallow up new funds, and probably a whole bunch of other things I've forgotten. As far as anyone can tell, there's at least 32 thousand Bitcoins (about $240k at current exchange rates) invested in this scheme[2], possibly much more. [1] https://bitcointalk.org/index.php?topic=91655.0 https://bitcointalk.org/index.php?topic=91655.0 [2] https://bitcointalk.org/index.php?topic=91653.0 https://bitcointalk.org/index.php?topic=91653.0

I can't believe people entrust virtual money to sites like these which in general - but consistently - seem to be run by amateurs.

by 0x0 14y ago

I can't believe people entrust virtual money to sites like these which in general - but consistently - seem to be run by amateurs.

sneak 14y ago

People still regularly fall for 419 scams, or the emails would stop. I got one the other day for a "scam victim restitution fund", asking for personal details. The mind reels.

astrodust 14y ago

Like smokers they often believe "it won't happen to them".

wmf 14y ago

AFAIK Bitcoinica was the only site offering BTC derivatives, so presumably some people figured the potential profit was worth the risk. More generally, all Bitcoin exchanges seem to be run by amateurs, so people have to deal with them to cash out.

0x0 14y ago
I wonder why. There seems to be a huge gap in the market for a professionally run enterprise here. Or at least, anything more focused beyond students half-assing it part-time.
- wmf 14y ago
  Bitcoin market activity may not be large enough to ever pay back the significant cost of building a secure exchange. Also, as TradeHill and CampBX discovered, people just won't move off of MtGox no matter how bad it is.
  - ScottBurson 14y ago
    People won't move off of MtGox for a simple reason: it has by far the best liquidity. The only way for another exchange to get a foothold would be to offer similar liquidity, which would mean taking the other side of most trades themselves. This would be very risky and they would need deep pockets.
jonhendry 14y ago
Derivatives as in options/futures/swaps/even more exotic? That is quite possibly the scariest financial product ever devised, assuming there was nobody putting together complex products based on Zimbabwean currency during their period of massive inflation.

makomk 14y ago

Right now, as we speak, Bitcoin users are entrusting their money to an investment scheme that has all the hallmarks of a Ponzi[1]. We're talking 9% monthly interest if you invest enough bitcoins, utterly implausible explanations as to what the money's being invested in, a seemingly limitless capacity to swallow up new funds, and probably a whole bunch of other things I've forgotten. As far as anyone can tell, there's at least 32 thousand Bitcoins (about $240k at current exchange rates) invested in this scheme[2], possibly much more. [1] https://bitcointalk.org/index.php?topic=91655.0 https://bitcointalk.org/index.php?topic=91655.0 [2] https://bitcointalk.org/index.php?topic=91653.0 https://bitcointalk.org/index.php?topic=91653.0