paulusthe

8 ms·

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by paulusthe 4y ago
He's right. Blockchain is a solution to a very idiosyncratic and uncommon problem set: 1. You and your counterparty both need to be pseudo-anonymous 2. You and your counterparty can't agree on an existing intermediary (bank, credi
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by paulusthe 4y ago
This is only tangentially related, but this article reminds me of Galbraith's "The Affluent Society" which should frankly be required reading for undergrad social sciences. In it, he argues that, at the time of writing (late
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by paulusthe 4y ago
Crypto shorts
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by paulusthe 4y ago
No, they're not. The definition of "Ponzi scheme" is not "something financial I think is a scam" as most people use it. It's a very specific type of financial fraud. "Everything is a Ponzi" is a lazy
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by paulusthe 4y ago
As if poor labeling results in $8bn of customer funds being lent to the CEO's hedge fund
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by paulusthe 4y ago
If we had one for binance, it would show a ridiculous amount of tether and other coins which they probably own a majority of, meaning their balance sheet is similarly comprised of assets they can't actually price or expect to be able t
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by paulusthe 4y ago
I'm not sure they have a choice. Binance is leveraged to the max with tether already; they likely can't afford to pay FTX real-world currency for the purchase. They'd have to offer tether or other vaporcoins as payment, at wh
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by paulusthe 4y ago
Binance is almost certainly facing the same situation as FTX, just without the bank run. They're leveraged to the teeth with tether, which they similarly treat as a crypto leverage flywheel. Binance just has first mover advantage; as a
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by paulusthe 4y ago
It went to the exchanges. They pumped the coins on the way up - Google willybot - which sucked retail money in. The smart exchange fraudsters cashed out on the way up. The uber-greedy exchange fraudsters held on thinking they could get more
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by paulusthe 4y ago
True. But getting FDIC coverage is a privilege which certain entities have earned as a result of compliance with an extensive regulatory apparatus whose goal is the stability of the financial system. Crypto entities haven't earned that
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by paulusthe 4y ago
This is why they're only trying to buy non-US operations. Binance is a fraud too; they invented the "I can use my exchange to create infinite long leverage" business model of apparently every crypto exchange.
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by paulusthe 4y ago
The question is if binance has the $$. They're doing the same exact thing FTX did, but using tether instead. They truly might not have the money to plug that hole. My guess is that binance just wants to take down a competitor. They pub
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by paulusthe 4y ago
It's not a fair point. If Alameda goes down, then ftx goes down, and if ftx goes down and is clearly wash trading (the most interesting finding in the article imo), then prices will plummet. It's not just a problem for the bank, i
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by paulusthe 4y ago
Sure, but at some point real dollars enter the financial equation, backed by these coins, none of which are probably priced correctly to serve as collateral. The ftt coin is shady as hell though. A 40% trading rebate for holding $1m is insa
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by paulusthe 4y ago
That's definitely the problem, but the answer isn't to change Twitter's algorithms. We must ask why Twitter's algorithms ended up where they did, and the answer is that it's more profitable to do what Twitter does t
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by paulusthe 4y ago
They wouldn't use it as much. The profitability of the site would suffer and it would cease to exist. It's not like Twitter set out trying to create an outrage machine. Their algorithms learned what people respond to - because res
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by paulusthe 4y ago
The solution to this is to end the whole thing, because the profit motivation and the public square function are incompatible. A middle ground is extensive moderation, but that of course becomes political (and rightly so) which undermines t
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by paulusthe 4y ago
I agree fully. The problem is that Twitter is designed with revenue in mind. Revenue requires the user use the product, ideally as much as possible, and the best way to do that is turn Twitter into a perpetual outrage machine where the loud