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Re: Many Reasons Why Crypto Currency is a Blight and WILL Eventually collapse to zero (as to all ponzis) 

By: Zimbler0 in 6TH POPE | Recommend this post (1)
Mon, 23 May 22 6:03 PM | 21 view(s)
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Msg. 32196 of 60008
(This msg. is a reply to 32185 by fizzy)

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Weaver points to M-Pesa, a payment system Vodafone started in Kenya in 2007 "about the same time as Bitcoin..."

It has eaten the Third World. It's huge. Because it just basically attaches a balance to your phone account. And you can text to somebody else to transfer money that way.... So even with the most basic dumb phone you have easy-to-use electronic money. And this has taken over multiple countries and become a huge primary payment system.

[Whereas] the cryptocurrency doesn't work."
>>>


Make sure I get this straight . . .
In Africa they have a payment system which allows 'easy-to-use electronic money'. And it has become a 'Huge primary payment system' . . .

And it doesn't work?

Now I don't care for crypto-currencies - for a variety of reasons. One is the fact that there is nothing tangible (not even a government) backing the 'currency'. Another is the problem of crypto-currencies 'value' spectacularly increasing in price (or decreasing just as fast).

But to say it doesn't work because ransomware artists are using it as their preferred method of extorting 'money'? Obviously it works for them.

And the third world is using a variation of it to facilitate transfers of money for goods and services?

Obviously it 'can' work.

And given that some 'cryptocurrencies' have collapsed spectacularly . . . Well, the phrase 'buyer beware' comes to mind.

Zim.




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The above is a reply to the following message:
Many Reasons Why Crypto Currency is a Blight and WILL Eventually collapse to zero (as to all ponzis)
By: fizzy
in 6TH POPE
Mon, 23 May 22 5:10 AM
Msg. 32185 of 60008


https://news.slashdot.org/story/22/05/23/0142229/lecturer-argues-cryptocurrency-should-die-in-a-fire-predicts-implosion

Lecturer Argues Cryptocurrency Should 'Die in a Fire', Predicts Implosion (currentaffairs.org) 34
Posted by EditorDavid on Sunday May 22, 2022 @09:52PM from the crypto-cranky dept.
Nicholas Weaver is a senior staff researcher at the International Computer Science Institute and lecturer in the computer science department at UC Berkeley. But he's also a raging cryptocurrency skeptic, arguing that cryptocurrency is useless and destructive, and should "die in a fire."

In a recent interview in Current Affairs he promulgates what he calls Weaver's Iron Law of Blockchain. "When somebody says you can solve X with blockchain, they don't understand X, and you can ignore them." So for those pushing cryptocurrency for "Banking the unbanked," Weaver points to M-Pesa, a payment system Vodafone started in Kenya in 2007 "about the same time as Bitcoin..."
It has eaten the Third World. It's huge. Because it just basically attaches a balance to your phone account. And you can text to somebody else to transfer money that way.... So even with the most basic dumb phone you have easy-to-use electronic money. And this has taken over multiple countries and become a huge primary payment system. [Whereas] the cryptocurrency doesn't work."

Weaver also contends that when companies say they accept payments in Bitcoin, "They're lying." (They're using a service which pays them in "actual money" after performing conversions on any Bitcoin proferred-up by a customer.) He believes cryptocurrency is only seriously used for payments for ransomware and drug deals — the things that non-decentralized currencies are legally obligated to block.
The reason I've gotten so sour on the cryptocurrency space is the ransomware. It's doing tens to hundreds of billions of dollars worth of damage to the global economy. And it only exists because people can pay in Bitcoin.

Weaver also believes cryptocurrency lets venture capitalists "carry out securities fraud as a business model" when they sell one of their startup's tokens to retail investors.
This is blatantly an unlicensed security. This is blatant securities fraud, but they didn't commit the securities fraud. It was just the companies they invested in that did the securities fraud, and the SEC has not been proactively enforcing this. They only retroactively enforce against the initial coin offerings after they fail.... and when things fail, the only people to prosecute are the companies, not Andreessen Horowitz itself. So they've been able to make securities fraud a business in such a way that they are legally remote, so you will not be able to throw them in jail....

The SEC has the authority to stop those proactively rather than reactively. They choose not to.... Basically, there's a fear among regulators — that I think started in the '80s — of being accused of "stifling innovation." There's no innovation to stifle. So regulate away.

He's also skeptical of cryptocurrency's other supposed advantages. Weaver argues cryptocurrency incentivizes green power "the same way that a whole bunch of random shootings would incentivize bulletproof vests." And even as an investment vehicle, Weaver sees it as "a self-created pyramid scheme."
[Y]ou have to keep getting new suckers in. As soon as the number of suckers dries up, it collapses. And because it's not zero-sum, but deeply negative-sum, there are actually a lot of mechanisms that can cause it to collapse suddenly to zero. We saw this just the other day with the Terra stablecoin and the Luna side token.

So when asked for the future of cryptocurrency, Weaver predicts "It will implode spectacularly." (By which he means it will "collapse greatly.")
The only question is when. I thought it would have actually imploded a year ago. But basically, what we saw with Terra and Luna, where it collapsed suddenly due to these downward positive feedback loops — situations where basically the system is designed to collapse utterly and quickly — those will happen to the larger cryptocurrency space....

[T]he Washington Nationals just the other day started doing a lot of tweets for their business relationship with Terra. That was $5 million for five years prepaid in advance in cash. So for the next five years, the Washington Nationals are obliged to hype a cryptocurrency that failed spectacularly already.


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