FTX is dead. Crypto is dead.

Haven't seen a thread on the FTX / Binance debacle. Opening this up to start discussion.

IMO crypto is DEAD for the long-term. Contagion hasn't stated yet. Institutional trust is shattered. Silver lining is it does open up a clear move towards DeFi and away from centralized products.


They don't even know. 

"The obedient always think of themselves as virtuous rather than cowardly" - Robert A. Wilson | "If you don't have any enemies in life you have never stood up for anything" - Winston Churchill | "It's a testament to the sheer belligerence of the profession that people would rather argue about the 'risk-adjusted returns' of using inferior tooth cleaning methods." - kellycriterion
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I'm still not understanding what the benefit of De-Fi is or why I'd want to have the privilege of figuring out how to store currency, whether it's crypto or fiat, by myself. I understand the argument for those in lesser developed countries and the fact that they can't trust their governments/financial institutions to have more control over their assets, but for the developed world, I don't really see the point of all this. 

Further, I imagine these huge exchanges, like Binance/FTX, sprang up because people needed access to liquidity. For example, I can go to any ATM in the world, use my Schwab ATM card, and withdraw money for free (my card refunds ATM fees as long as it's under 25 transactions a month or something like that) and I have faith that Schwab isn't investing the money I'm giving them to safeguard in shitcoins or something like that. I can't imagine how big a headache it would be if we moved to a "De-Fi" world where I had to estimate the BTC I'd need before a vacation and potentially be SOL trying to pull it out of cold storage (or whatever the mechanism is) if I needed more for whatever reason. Plus, there's 0 recourse for someone stealing your money in a De-Fi world, whereas I at least have some shot of disputing fraudulent charges, etc. through BofA.

Note, I'm not a total crypto hater. I actually own some and think the underlying technology has some cool use cases (i.e. smart contracts) that can reduce friction in the markets. That said, I don't really see how decentralization and making people responsible for their finances benefits the average person. I'm genuinely curious, so if someone can point the flaws in my logic, I'd really like to hear out why this technology is beneficial for most users and could take over the world someday.


This is spot on. I think it's the classic entrepreneur vs. investor mindset difference.

Entrepreneurship is the art of the possible, you have to will things into existence; suspend disbelief and think about what can go right and the steps to get there.

On the flip side for investors, the deep rooted inclination to think about distribution of probabilities, not possibilities, is oftentimes perceived as "pessimistic".

If anyone has a response I'd be super interested to learn as well.


I can't believe you pieced that all together working out of the pawn shop unit . . . 


I used to think the same thing about smart contracts and was really bullish on them. I really thought that ETH could make it long term because of that and would eventually become the dominant crypto. The problem is that smart contracts can also be used for some really, really terrible stuff (anonymous domains, child porn, etc.). I am afraid that it would (will? it could still happen) become something super negative and cast everything in a bad light. It has the potential to be something that society will wish was never invented. 


Neither bull nor bear on defi and crypto in general here, but a thought...

You hear a lot of rhetoric in the defi space about the problems of centralization (rarely are the benefits discussed). I think today's inflationary environment also helps stoke of that fire whereby a lot of defi supporters will point to US Fed "printing" and the subsequent inflation as a monetary issue...but also a class issue (ie. if you are rich you've benefitted for low interest rates and free money, if you're poor your rent has gone up 30% but wages have not). The idea is that defi would somehow protect / financially regulate in a "fair" manner those who don't receive the benefits that the wealthy (ie. capital owning class) do. So there is an emotional aspect to that pitch. In many instances it can come across as a bit of a libertarian take on financial regulation and the monetary system. (eg. the pesky financial system always benefits the rich and not the poor, and that is because its a centralized cabal of bankers/haters/etc. If we could just change that, the world would be a more fair and equal place. I can make my own decisions on risk without having to worry about some bAnKeRs crippling my financial future.)


That's a fair point, but, and this is a theoretical question that some macro guys can maybe chime in on, is it beneficial for a currency to be inflationary if it's meant to be used as a medium of exchange? For example, let's say bitcoin works great in that it's supply ends up getting capped and no centralized authority can debase it by printing more bitcoin. If that's the case, then in the long-run, it's probably smarter to hold bitcoin versus using it as a medium of exchange, no? I wonder if there are other currencies in history that have had this feature and how that panned out.

My theory is that in general, this would still end up disproportionately benefiting net savers who spend less and maybe earn more bitcoin because of their work, how they invested it, or whatever. Therefore, wouldn't class issues still exist?


After the first exchange or two crashed, I thought to myself "growing pains".  It's a new industry. 

After seeing a few more crash, I never want to get involved in crypto. Seems like this industry just can't get its act together.


De-fi showed its true nature when wallets and exchanges seized assets for reasons. Decentralized my ass. It's crookie off-shored money storing.

There are only 2 times when I considered crypto. When BTC was at 400 usd, for the hype. Then 6 months ago I threw in some 1k, with the acknowledgement this would be likely lost.

It has failed the alternative currency role, NFTs were an absolute catastrophe in the long run.

However, paper money failed many times before it became a staple, so crypto might be back.

Never discuss with idiots, first they drag you at their level, then they beat you with experience.

"De-fi showed its true nature when wallets and exchanges seized assets for reasons." If your assets were seized then that is not De-fi, that is centralized finance.  FTX is centralized finance. De-fi continues to chug along.


Not largely knowledgeable on the crypto market but did make a couple hundred thousand on the last bull run. Everyone always says when there’s fear in the market it’s the best time to invest so I’ll definitely be deploying some more dollars very soon. Even if the fundamentals are trash, markets can clearly be manipulated. I won’t be missing out on any future runs.


The thing that will save cryptocurrency in the long run is the same thing that will kill it--regulation. The market is too unregulated, leading to potential collapses and uninsured losses like with FTX. This is why commercial banks aren't going anywhere any time soon--they have FDIC insurance, which is INCREDIBLY difficult to obtain and requires arguably the most intense regulatory regime thrust on any industry on planet Earth and in the history of man. You need regulation in the cryptocurrency world to make it truly mainstream, but the regulation kills a lot of its ostensible benefits. 

I spent 8 hours at a cryptocurrency conference in D.C. a few weeks ago. I'm still not clear on what problem is being solved. Maybe this makes me a "boomer," but the U.S. Dollar is backed by the full faith and credit of the United States, and even with all of its faults I'd take the full faith and credit of the U.S. any day of the week to a digital currency backed by nothing or even gold, which is useless in a collapsed society anyway. My deposits with insured banks are backed by the FDIC insurance fund, which is incredibly well funded, which is backed by the full credit of the United States. Bad currency depreciation for the U.S. is ~10%(?) in a given year. That's a week of BTC trading. This means I can actually engage in contracts with dollars. I simply cannot see the problem that is being solved with cryptocurrency.  


Binance may be next. I had looked into it last year, smelled fishy, stayed away.

Just saw texts of MS director trying to pitch Fried as Ultra Genius to Musk. 

What the fuck guys

Never discuss with idiots, first they drag you at their level, then they beat you with experience.

I feel like neither crypto nor blockchain are dead. I do think there is a huge hype issue in the space that can really muddy the waters on expectations which is exacerbated by an intentional lack of regulation and education. I also think painting crypto with a broad brush in the sense that "they're all the same" (as many do who don't understand the space) is incredibly inaccurate. There are different tokenomics, consensus mechanisms, scaling solutions, etc. These factors alone could drastically change the use-case of a token, protocol, or project. It should also be noted, most of the value in many of these projects (in the long-term sense) is coming from how they're planning on or actively using their blockchain tech. Blockchain could and likely should easily revamp remittance payments. Even just from a cybersecurity standpoint (for those that have been audited and also stand the test of time), lacking a central point of failure (more blockchain tech than crypto — but also a factor in the crypto space) is an incredible advantage that is truly unprecedented. 

Also, this trope of "crypto is dead" is over a decade old now I believe. I will say, before 2020 or so, there weren't nearly as many use cases within the space. That being said, anyone that denies the growing pains that we have to work out as an industry is in denial. We have to do better, and I'm hopeful that we will.


No doubt, the FTX / Binance situation is making waves. However, let's not be too quick to declare the death of crypto. This ecosystem has weathered storms before. Institutional trust may be shaken, but let's not forget the essence of decentralization.


Reflecting on the past year, we can see how the crypto landscape has adapted to various challenges. The emergence of DeFi and the ongoing efforts to address issues related to trust and security demonstrate the industry's resilience.

For individuals interested in exploring cryptocurrency opportunities and staying updated on developments, resources like https://presale.world remain valuable. They provide insights into ICOs and pre-sales, even in the context of a year-old thread.

In conclusion, while the crypto industry faces hurdles, it's important to recognize its ability to adapt and innovate over time.


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