UKC

This news article: https://www.ukclimbing.com/forums/ukc/the_game_of_everest-760204

Has the unexpected side-benefit of highlighting this:

https://web3isgoinggreat.com/

The May 28 post is a perfect microcosm of why you really, REALLY, shouldn't play in crypto.

Actually, to be more precise, putting money into crypto is a game of betting on there being plenty more ill-(technically)-literate fools to come.  As long as you are ahead of the belief curve, you may win.  So the game is now judging said belief curve.

I don't have (much) skin in the game but that site seems to log about a dozen examples of fraud per week across cryptocurrencies, nfts etc. Imagine the numbers if there was a similar site for fraud involving fiat money.

Given that site doesnt report low level fraud or similar failures I would go with the number would be far lower. Just look at SVB being headline news for several days when it would just be another quick story in crypto world.

That's not the case though is it - SVB cost its customers $20bn. This site reports $440k issues. I know it's relative to the scale of the market but this feels like fearmongering.

Crypto is the same as any other investment scheme in that the potential risks increase with the potential rewards, and given the headlines everyone should know that getting rich through crypto is unregulated, subject to pump and dump shysters and shills as well as hackers... but effectively so is the stock market. The same rules should apply - only 'bet' with what you can afford to lose.

Gambling when others have more knowledge than you is really bad and wasteful.

Madness that the financial world is built on that.

But there is the problem isnt it? "Investment scheme", I'm not sure?  Gambling,  that's what it really is, not investing.

 Also with the added complexity of you not even knowing whether the horse you picked is real, leave alone whether its a potential winner?

 If you are drawing comparisons with the stock market, can you please explain how investing in crypto for example pays a dividend?

Intrigued to know.

This argument is mad. For many, many reasons, but to give just a couple:

- Fiat currencies are hundreds of times the size of crypto and if you were to include all the financial products and derivatives and so on, that relative size is probably 1000s of times bigger than crypto. You are not comparing like-sized markets in any way.

- Fiat currencies and their products and derivatives are subject to regulation. A lot of regulation. So while the playing field is never truly level (the big boys are always going to have a bit of an edge), the rules are in place to ensure everyone can reasonably play the game. The crypto world is the wild west of the wild west, it is bursting at the seems with fraud and scams because that's exactly what happens when there are no rules or regulations (you only have to look at the sort of garbage which went unpunished in the 1920s in the USA to see the sort of garden variety bad behaviour that flourishes in an absence of rules).

- You're assuming that that site is some kind of definitive list of frauds and scams, I would doubt that very much. It's just the ones the author(s) picked up on.

Tomato/ tomato!

In terms of not knowing if the horse is real, that depends. Some currencies are nonsense ponzi schemes (eg Doge). Some are simply stores of value (Bitcoin) but others have genuine commercial uses and are already revolutionising how business is done (some of the Ethereum/ smart contracts/ interoperability tokens). It's about doing enough research to understand the proposition and determine the business case for yourself.

Too complicated for me - see here: https://www.coinbase.com/learn/crypto-basics/what-is-staking

1) Yes, agreed. I said that. The SVB example is 1000s of time bigger than those on the list

2) Yes, agreed. I said that too - higher the potential reward, the higher the risk, in fiat as well as crypto. See dotcom bubble, for example. How well did the regulation work in 2008? 

3) Yep, agreed too. I'm not aware of any definitive lists of fraud in any sector

Random nature of outcome makes this gambling and  people who think they are investing normally just lose more. 

Are you saying you do not know what a dividend is?

No, I'm well aware of what a dividend is. There's no direct comparator in crypto but staking has some of the same characteristics. I haven't looked into staking personally and wouldn't come here and pretend I fully understand it, so provided a link in case you wanted to see for yourself.

This is wrong.

And I think that adding the word "effectively" suggests that you might know it is wrong.

In addition to what I said before about rules and regulations, the companies in the stock market are fundamentally enterprises with capital assets and employees that produce products that people buy. You can value a stock in the stock market by many metrics of productivity, or even future possible productivity. Crypto is completely different because it has no physical assets, employs nobody and produces nothing, it's value is purely speculative - hoping the next person will pay more for it than you did.

If you really want to liken crypto to another market, I would suggest that you compare it to collector markets like the fine art market or the stamp collecting market. It's a ways from being a perfect comparison but there are some similarities.

There are many ways to invest in the stock market so I wouldn't agree that you should only "bet what you can afford to lose" because, with a conservative and sensible strategy, your original investment should be pretty much guaranteed to increase in value over the long term and even during bad period, you are only going to lose a certain percentage of your original investment. Whether you should invest in stocks and how you should do it shouldn't be simplified to "bet what you can afford to lose", it's just far to complex a subject for that.

Of course I know it's regulated. How effectively that regulation work is debatable

Often true but not always - some coins have utility and value.

Yep, Vanguard all cap global 500 will net you a good, sensible return. The key word is conservative. With a higher risk appetite comes higher potential rewards.

Didn't mean for this thread to become about me, and I have work to do :-D 

So the reality  is 100% no comparison with investing in shares which pay a dividend.

The risk factor on that fund is reasonably high by most  definitions.

It is not conservative.

It is a gamble - as is any investing IMO. I own some BTC which I hold on my own ledgerS which sits in my safe. I hold the coins as part of my investment portfolio. I have shares, precious metals, crypto and property. I'm not really interested in anything other than BTC in the crypto space. I did hold some ETH and SOL (got burnt on that!!) 

It is the wild west so I wouldn't keep my coins with a gemini/coinbase type exchange. I would just use them as on/off ramps to buy/liquidate. 

Or the gold market. All of these things relate to commodities which are finite, but which otherwise have no intrinsic value. All are therefore tradeable - at whatever rate the markets decide.

and traditionally, finite investments have been seen as sensible in inflationary environments.

The state of the UKs finances looks terrible right now. I can see a currency crisis appearing on the not too distant horizon (other opinions are available). The rest of the world looks pretty rubbish as well right now. China manufacturing PMI this morning was rubbish. US debt ceiling debacle. Interest rate hikes slowly killing US and European banks...... something is going to snap.

No the site reports a whole range of issues.

SVB didnt cost its customers anything. It cost its shareholders and it cost the shared insurance scheme.

FTX on the other hand cost its customers a lot.

As did Celsius and so on.

This is the sad thing really. "Crypto" in theory has a couple of okay use cases. Problem is all the morons who have wrecked it as a currency and just turned it into a roll of the dice.

Aside from the stock market has some rules and regulations limiting the damage which can be done. Its far from perfect but there are protections there. Good luck setting up your FTX equivilant for the stock exchange. The regulators would crucify you.

I bought most of my trad rack using a small amount of profits from my Cardano holdings just before the arse fell out the whole crypto market in September 2021, this was the second time this had happened as I was almost wiped out in January 2018 too.

It's really no more 'risky' than regular stockmarket if you're sticking to robust projects with a use-case and using stable exchanges and view it as mainly long-term.

That said, there's always the prospect of something I'm holding 'mooning', in which case then it'll be early retirement time! 

So lets get this right..you have been wiped out twice in three years.. and yet youare  still hoping for the big one turning trumps.

Considering Bitcoin was (as I reccall) about £500 when I dipped a toe in 2013, rose to high thousands, dropped back to low thousands, climbed to something like £40,000, back down to almost half that, then back up to something like £25,000 last time I was paying attention, there seems as much reason to think it could go way up again as not.

It's clearly more volatile than most traditional stocks, but from the minimal attention I pay to affecting factors the concern from various central governments over its unregulated nature has been a big factor in making people/institutions loose faith, not any inherent dodgyness (though I'm only talking about Bitcoin specifically). 
The basic premise - a decentralised universal currency - and the process of exchanging it seems, to my understanding, perfectly reasonable and sound. It's adoption by folk keen not to follow normal ways of moving money is unfortunate, as its energy-intensive nature, but that needn't condemn the principle outright.

And a bank refunds you if the fraud isn't your fault. 

That’s a very long winded way of saying criminals. But they are the only people who really need Bitcoin, right? 

So it’s a method of facilitating drug running and people smuggling that has the added advantage of really f%^cking up the environment. It’s sounding better and better*.

The only principle here that I see is people trying to gamble on what they hope is a sure thing. 

 

* if you’re a moral degenerate.

Very funny cartoon in Private Eye the other day. Couple driving along the motorway, see a sign on the overhead gantry: 'Invest in Crypto!'

Passenger turns to the driver and says 'I thought you said this was a smart motorway?'

My personal view is that while it's an interesting concept, it's massively volatile and almost completely unregulated. There's also a few stories of people losing millions when their hard drive went kaput!

Apart from all that, though, I'd completely avoid it out of principle, as the mining part of the process has an insane carbon footprint!

It's not almost completely unregulated, it's completely unregulated. That's the point.

You can equally lose cash money, in any number of ways. (Or just burn it, like The KLF did.)

I am intrigued by Bitcoin: it's a elegant idea, and a sophisticated one. The biggest mystery is exactly who thought it up. We will likely never know.

It's clever in the sense that the founders have made a killing at the expense of others, wonder how much carbon has been released purely related to bitcoin. I don't think it has any redeeming feature at all. 

That proposition can be applied to Berkshire Hathaway , Apple , Amazon , etc and a host of other traded shares.  

This thread has a sport analog:  'Base jumping - and why you should never'

Fact is people have variable and wildly different thresholds of risk awareness and acceptability - and do whatever suits their psychology / humour

Molly White who runs that website did an interview on the excellent Against The Rules podcast, by Michael Lewis who is writing a book on Sam Bankman-Fried.

https://www.pushkin.fm/podcasts/against-the-rules/on-background-crypto-skep...

FTFY. As ever, you write very silly posts.

That's one way to look at it sure! The market works in cycles. I remember 2018 being a bit miffed when everything crashed with ADA at $1, but not that long after the price was back 3x that. 

Important to point out I've only been 'wiped out' in the sense that the price plummeted. As with any stocks/shares you only lose when you sell below what you paid. As I've only ever sold at the top and still own 99% of my assets. I've technically not lost anything.

Like someone else said, only play with what you're happy to lose.

Who made a killing? Its founder(s) is anonymous, and their wallet hasn't been touched since inception (which is visible on the public ledger). I'd honestly recommend investing some time in researching Bitcoin's story / ideals / myriad benefits. It's a fascinating technology that has the potential to transform fair value exchange as we know it. 

https://vijayboyapati.medium.com/the-bullish-case-for-bitcoin-6ecc8bdecc1

There'll come a day in the not-too-distant future when Bitcoin's ubiquity makes all the naysayers look like those clever folk who said the internet / email / mobile phone would never catch on... 

You have no way of knowing if that's the founders only wallet, they could have also been the first thousand purchasers buying/creating/mining smaller amounts and became rampers talking it up, you see it all the time on share trading forums. They then sell at a later date.

How many people have lost money due to exchange collapses, fraud and IT problems? 

Yes, crypto currency could become more widespread, but given that many of us barely use any cash, then they technically it already exists, only more regulated and transparent. The electricity use alone will mean bitcoin won't ever be a global daily use currency of the future. 

Bitcoin's first 'purchasers' were peer-to-peer transactions that held no value. It didn't attain monetary value (a $ price per Bitcoin) until summer 2010 – more than a year after its inception. 

Honestly, read about it. You won't regret it.

https://en.bitcoin.it/wiki/Myths 

uh-uh. Where are some examples of those clever folk saying it ten or so years after those products got out the initial phase?

What is the use case you are seeing?

It certainly isnt day to day usage unless you solve the tps issue which can only really be done by undermining the principles behind it.

The belief, as shown by many fans, that its a good investment also is a problem for any more general usage. Whilst you can speculate on traditional currencies thats more a bug than a benefit. People dont generally like their currency to wildly swing in value.

I'm not a spokesperson, just an interested individual. All your questions can easily be answered with some low-level internet browsing. But in terms of tps, read about the Lightning Network: https://en.wikipedia.org/wiki/Lightning_Network 

Personally when I am interested in something I would argue for or maybe against it. Aside from anything else it helps me check my understanding of the subject and firms up ideas.

And now we are in classic "do your own research" terrority.

Yes I have done however at the risk of pointing out the obvious I was asking about Bitcoin tps issue. Not about a separate system laid on top of bitcoin which removes several of the "benefits" of bitcoin whilst adding new risks.

What's the point? If I want to transfer money to someone I can send it from my bank account to theirs, or even give them a wad of cash. If I want to buy something online I can use a credit card. What's the improvement that bitcoin offers me?

That's cool. I'm not you. 

What's wrong with that?

Do you think your Visa card transfers 'actual' money? It's a payment rail, layered on top of a monetary system. But if you'd read about it, you'd probably be able to 'point out the obvious' too... 

Its normally deployed by people who dont actually understand the subject. Hence why its a firm favourite of conspiracy theorists and crypto enthusiasts.

You seem rather confused here. I asked a simple question about bitcoin. You have answered it by saying use something else which lacks several of the safeguards and hence claimed advantages of bitcoin.

You dont see a problem here?

Seems a little like you just fancy an argument, so with that, I'll wish you well ✌️

That makes sense.

To me, a good investment and a means of exchange (everyday currency) are mutually exclusive.

If your everyday currency gains value and is good investment, you don't spend it today because what you buy will be cheaper tomorrow. Prices going down is deflation, people hold on to their currency rather than spend or invest, economic activity is reduced and unemployment rises.

No losses in exchange rates or to 3rd parties?

Are there no fees for buying and selling bitcoin?

Haven't you just contradicted yourself there? It's not the same as any other investment, precisely because it *is* unregulated.

“Something like Bitcoin, it is a gambling token, and it doesn't have any intrinsic value. But that doesn't stop people from wanting to play the roulette wheel,”
 

Best quote on crypto. From Warren Buffet, possibly the greatest investor the world has every seeen