Reminder: People never shut up about crypto gains, never mention the losses

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Submitted by gzz on June 23, 2021 - 4:22pm

Another $3.6 billion crypto scam. The people had only account balances saying they were making tons of money and likely became evangelists for the scam.

They won't spend 1/10 the effort to warn people about it now they've lost it all.

https://zwnews.com/africrypt-cajee-broth...

Submitted by sdrealtor on June 23, 2021 - 4:34pm.

Crypto Baby! Nothing but losses for me! Im down $148.

Submitted by Coronita on June 23, 2021 - 7:49pm.

I'm down 11%....it sucks....

crypto babycrypto baby

Submitted by Escoguy on July 1, 2021 - 7:56pm.

This is so true, I have a friend who was constantly texting me about bitcoin for years. So I finally bought in last fall. Fortunately, the timing was good and the 0.27 bitcoin I bought basically doubled in about a month.

I sold half and kept half.

Yes, traded in and out some but have given up about 7K in paper gains.

My intuition told me to sell the week before Musk started his pot stirring.

Holding for now. It's not even 0.25% of net worth so in some ways like a partial lottery ticket.

Submitted by Coronita on June 23, 2021 - 10:20pm.

instagram and this iGen is hell bent on proving how easy it isnto make quick money and end up eith a "seven figure net worth" without working for it...they literally think all of them can do this by listening to MEME stock traders and social media influencers who white a lot about personal finance but they themselves have sketchy finances.

If i hear the following buzzwords from someone im going to go postal

"side hustle"
"5 figure to 6 figure"
"7 figure net worth"
$5000 in one week

Submitted by The-Shoveler on June 24, 2021 - 6:55am.

LOL the whole idea that a number generated by a computer algorithm and based on no other use or value other than its uniqueness (in which there could be literally millions more computer algorithm based coins with different names started every day) could be worth thousands of dollars is just completely insane to me.

Submitted by svelte on June 24, 2021 - 9:49am.

The-Shoveler wrote:
LOL the whole idea that a number generated by a computer algorithm and based on no other use or value other than its uniqueness (in which there could be literally millions more computer algorithm based coins with different names started every day) could be worth thousands of dollars is just completely insane to me.

Agreed, it boggles my mind also.

On top of that - why does anybody think that governments are going to let untraceable money stand? It's enabling the ransomware craze and you can bet it will enable worse things than that...governments will be left with no choice other than to take action.

Submitted by gzz on June 24, 2021 - 12:52pm.

Esco's post illustrates something important with crypto: 99% of people don't actually own the crypto, they own an account with an "exchange" that claims to own it.

These exchanges are regularly hacked or just giant frauds.

They also I suspect don't have giant amounts of US dollars sitting around ready to redeem. As long as more money comes in than out, they can pay people who want to withdraw money. But if, say, 10% of people want their funds out, they will just say "sorry don't got it."

But in the meanwhile, people log in, see their account value in US dollars that do not actually exist on the exchange, and are happy and keep sending the exchanges more money.

Submitted by gzz on July 19, 2021 - 7:24pm.

Bitcoin down 52% since May, Dogecoin that Elon Musk was pumping on Twitter and SNL down 77%.

Not hearing so much about it anymore?

I like the chances of my COIN puts.

Company has a 30% margin now. If it loses half its revenue and margin goes down to 15% because of fixed costs, that's a 75% decline in profit.

What's a fair PE for a company with a 50% decline in revenue and 75% decline in profit that has rapidly growing competition and may get shut down at anytime and sued out of existence for selling unregistered securities? Well it will be 150 P/E in that case at its current price.

And a 50% decline in revenue is very possible. Trading volume is way down. And whenever I log into paypal I see a "buy crypto" link. Who needs a new account at Coinbase?

Here's some additional detail:

https://twitter.com/eriz35/status/141529...

As far as an entry point, they are about to report a record quarter that includes the April/May frenzy. That could send them up, but they are supposedly under a legal obligation to note that the current quarter revenues are collapsing.

Balancing this, I say go in about half way now, wait a month or two for a better entry point.

BTW coinbase charges $3 + 0.5% of each trade. So for a $600 trade, you pay $6 or 1%. By contrast, stock brokers these day are almost all no commission. One of a million ways crypto is greatly inferior to all the things it supposedly is going to replace.

The bubble was pumped to new highs by people bragging about their gains. Now everyone is down 52-90% in just 10 weeks. The people who bought the dip got creamed.

Crypto produces absolutely nothing of real economic value, but has a gigantic ecosystem of pumpers, scammers, traders, programmers, miners, etc that need to eat. Roughly speaking, there needs to be at least $3 billion a month of cash inflows from new suckers to trend water. It was a lot more than this early in the year, now it is less.

Submitted by carlsbadworker on July 20, 2021 - 8:40am.

Wow. This thread is so one sided.

So let me provide some counter arguments.

1. "the whole idea that a number generated by a computer algorithm and based on no other use or value other than its uniqueness"

The value of cryptocurrency is not based on its uniqueness, but the fact it is a programmable system to communicate ownership and transaction. Correspondingly, There are more than 8,000 monthly active developers working on various cryptocurrency projects, with some 80% of those developers starting in the last two years. These engineers create value by solving problems (payment is a much big problem in developing countries).

2. "Why does anybody think that governments are going to let untraceable money stand?...governments will be left with no choice other than to take action."

Why does anybody think that governments are going to let free speech to be mediated by a few large company like Facebook? Again, if you take a US centric view, maybe there is more to lose than what the government could gain. But Chinese government is already minting cash digitally, in a re-imagination of money that could shake a pillar of American power.

3."These exchanges are regularly hacked or just giant frauds."

These are early days in crypto. Just like when web started, there are lots of "websites" that are hacked or just giant frauds. But it doesn't mean there isn't going to be real business like Amazon emerging from these. The current bitcoin adoption rate has promised that the largest digital coin will hit the one billion user mark nearly two times faster than the internet did.

Regulations will come and so will the use cases.

4. "I like the chances of my COIN puts."

Nobody is investing in Coinbase based on its PE ratio. Even Coinbase itself is not aiming to make money: it aims to make money during crypto bull market and lose money during crypto bear market...so that it could spent money to built up the payment infrastructure for the future, similar to the way Amazon uses investor money to built up the distribution centers.

-----

That all, said, I have no doubt that crypto is in bubble territorial, but bubble is maybe what we need for every technology revolution. In fact, you look at history, every major technology change comes with a financial bubble. Industry revolution -> South Sea Bubble; Railroad -> Railway Mania; Age of Oil/Automobile -> The roaring 20s; Internet -> Dotcom bubble. It is the bubble that provides the financial capital to lay out the infrastructure to allow the next generation of entrepreneurs to take advantage of it.

I do not personally own crypto...other than the free credit from my coinbase account. But I think it is wrong to completely discredit crypto...and there might be good investment opportunities after all the dust has settled.

Submitted by gzz on July 20, 2021 - 12:23pm.

"There are more than 8,000 monthly active developers working on various cryptocurrency projects"

Yep, and it's now a 12 year old tech that has still not actually done anything useful for anyone who isn't a criminal or speculator of some type.

Every "use case" from those 12 years has been heavily funded and showed to be pure hot air. The first one of being used like money is a failure. The second of being used for money transfers (as opposed to purchases) is only used by criminals because it is far slower and more expensive and less secure than other methods.

Meanwhile it has caused gigantic and permanent damage to the environment and facilitated criminal activity of all sorts. Theft, ransomware, international drug smuggling, tax evasion.

"but bubble is maybe what we need for every technology revolution"

Railroads and the Internet are useful to non criminals. I disagree there's any revolution here. Just hype, senseless and knowing destruction of resources, fraud, and greed. Perhaps the best historical comparison is to private banknotes from the 1800s.

Submitted by gzz on July 20, 2021 - 12:31pm.

"Nobody is investing in Coinbase based on its PE ratio."

Yeah, it is a bubble levered to other bubbles, and a platform for trading worthless fake "coins" and "tokens" that are promoted with fraud and are illegal securities.

Maybe it will pop, maybe it won't, but the puts are awfully cheap considering how often and hard crypto has crashed.

Ever after falling by about half since the IPO, COIN has a 50% higher market cap than the Nasdaq, the most successful stock exchange in the world.

I read COIN's annual report and they have a line there about how they get paid by the scammers to give out free tokens as "rewards" for "achievements" that consist of watching promo videos for the scammers' tokens. In other words, the same model of scammy timeshare operators, we pay you to watch our sales presentation.

Submitted by scaredyclassic on July 20, 2021 - 12:46pm.

saw THE FURIES last night, really cool psychological western from 1950, anyway, the main character, a sociopathic land baron, T.C. Jeffords, was issuing "T.C.s" in the film, his own legal tender in the area. in the end, they are his undoing, and they end up in flames.

seemed very timely. unusually psychologically probing flick from the criterion collection, with Barbara stanwyck and walter huston.

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