The Argument Against Crypto Currencies
“Coins” that are not backed by a government representing a rule of law and an army to enforce it, at the end of the day do not have any real value. Dollars and any other denomination are representative of their respective economies and ability to enforce ownership. Just look back at the origins of “money”. They were all actual coins representing some general or king, backed by actual economic might (erg gold and trade). And these coins would collapse when their empires collapsed. What is Bitcoin representative of? Nothing. It solved partially for the ownership problem by rephrasing it as a collective coordination game theory problem, quite elegantly, but that is only half a solution. Until any coin actually represents something, like a country adopts it as fiat, it is basically worth nothing. It is a science experiment.
As one of my financial advisors says, “No one rings a bell to tell you when the crash is coming. Luna, Bitcoin, FTX, Dogecoin, etc. LGB coin going for $0.0000000008″
New School are simply buying the Emperor’s new clothes….it’s great gig for those in on the scam but it will go to Zero because well it is NOTHING NOTHING at all. It is just a few electrons on a drive….it’s origins are extremely shady…made up name Satoshi…started as a utility failed and hey presto a store of value…that’s when it went full ponzi…it meets all the definitions of a ponzi and then some. This generations glistening IPO–looking for the get rich quick and live like an emperor. Seem like a great deal until everyone sees the emperor has no clothes. It will die it’s just a matter of when. The only thing sustaining it is the greater fool theory…hey some got rich and well played…hope they diversified. Gold will still be here end of this decade Bitcoin will not…. there is no way that thing is getting out of this decade…none of the crypto’s will. But be warned central bank crypto is a poison all of it’s own if it comes….There is simply no need for it other than nefarious reasons on government and Central Banks part…
The whole crypto universe seems to be populated by fraudsters and people who are too greedy or lazy to understand what they are buying. I really don’t care very much who loses or how much as long as the losses and economic effects remain within the La La world of crypto. That said, SBF appears to be a particularly predatory creature in the crypto swamp; I do hope he spends many, many years in prison.
But when the press and general public talk about it, they tie it to crypto assets themselves. That damage will take time to undo. Once again, crypto class assets evolved to be stored and transacted by the OWNER of the asset, not an intermediary. That’s why it was decentralized and trust less from the start. Anyone with access to the internet can store and transact crypto assets in the same way people can do with cash or gold, but without physical limitations of cash gold. Companies like FTX perverted this concept and used public’s confusion and trust based on regulated asset to perpetrate fraud.
The future of crypto assets is probably tied to institutions and applications which leave the owner in control and supervision of what happens to their assets, while abstracting custodial complexity and user experience away from them.
What’s the mechanism that’s propping up Bitcoin? Despite the constant influx of crypto bad news, it’s been suspiciously tightly rangebound at 16-17k all through the FTX collapse.
It’s hard to believe that anyone is putting money into Bitcoin at this price in the current environment. So are the crypto whales simply really stubborn at holding, as they like to claim? Or is there something else going on?
Is it possible that they just generate more “stable coins” out of thin air, still pegged to 1USD, and use them to keep buying bitcoin to prop up the price? As long as people do not question the peg, this looks like a real demand. Not saying this is the case, but I wonder if it could explain the current situation if true?
Tether and Binance. One and/or both will have to break for Bitcoin to aggressively decline. The sad part of the whole FTX sordid affair was that it had little to do with the actual crypto. It may as well have been widgets. A very traditional financial fraud scheme was perpetrated at scale using methods well known to traditional financial markets without any traditional regulations or oversight.