[HN Gopher] Coffeezilla, a YouTuber Exposing Crypto Scams
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Coffeezilla, a YouTuber Exposing Crypto Scams
Author : mitchbob
Score : 215 points
Date : 2022-05-14 12:45 UTC (10 hours ago)
(HTM) web link (www.newyorker.com)
(TXT) w3m dump (www.newyorker.com)
| mitchbob wrote:
| Archived: https://archive.ph/3wlkM
| headsoup wrote:
| Also, bitfinex'ed on Twitter (and previously Medium)
| danieldevries wrote:
| I've followed Coffeezilla for a while. I was doing an AI course
| from another youtuber named Siraj Raval in 2019. The course ended
| up being totally amateur and full of empty promises.
|
| Mr Zilla did a video about it:
| https://www.youtube.com/watch?v=7jmBE4yPrOs 'AI Guru makes
| $238,800 with misleading paid course. doesn't credit developers.
| | Siraj Raval FGF'
|
| Then Zilla started exclusively focusing on crypto/NFT scams. The
| first few were interesting. Now... its a quite tedious, "the
| blockchain never lies...look they pulled the rug..." _yawn_
|
| I hope he goes back to covering other interesting topics again.
| Fargoan wrote:
| Agreed. It was a much more interesting channel when it was
| about scams in general. I suppose bsc shitcoins and what not
| are just easier to make videos about and it gets the views
| [deleted]
| gk1 wrote:
| Before this he had a long streak of exposing business gurus
| selling online courses.
| 1337biz wrote:
| I guess crypto videos get him more views. Most of the videos
| are super boring, like yeah who would have thought that some
| shady YouTuber promoting a token on Binance Smart Chain would
| turn out to be a scam.
| danieldevries wrote:
| Yep. Ironically I felt he turned into the very thing he was
| uncovering. Towards the end of 2021 he made this promise to
| donate X dollars to a charity if he reached a million subs.
| It came across as pretty disingenuous.
| yifanl wrote:
| Coffeezilla himself is invested in crypto, so this type of
| content is now very much in his wheelhouse.
|
| After all, being a youtuber is all about monetizing your
| hobbies.
| can16358p wrote:
| Good for crypto. I'm a crypto enthusiast and I think crypto has a
| great future and work in the field.
|
| However because of many scammy projects the whole crypto
| ecosystem now has a bad name.
|
| I'd love to see more and more scams being exposed for healthy
| adoption with less manipulation and real investment to projects
| that have the potential to change things instead of 400000% APYs.
| [deleted]
| Feriti wrote:
| So what are real use cases in your opinion?
|
| Something which really need crypto/Blockchain and is really
| trustworthy?
|
| Something which doesn't break the trust Anker of a Blockchain
| by having any dependency outside of a Blockchain.
| abxytg wrote:
| "Something which doesn't break the trust Anker of a
| Blockchain by having any dependency outside of a Blockchain."
|
| Only the critics look for this type of weird ideological
| purity. the rest of us just want somewhere to use the value
| we create.
| Feriti wrote:
| I'm totally lost on your statement.
|
| So you try to use this tech for tech sake?
|
| Independent if there is already an existing solution?
|
| A project is trying to add Blockchain technology into a
| project I'm working with. Just that the Blockchain is owned
| by some company and that company was publicly asking people
| I don't know if they are able and motivated to operate a
| node for them.
|
| This for example sounds way more complex than just creating
| a company which has the purpose of being the trust Anker,
| implemented with technology like CA, contracts etc.
| arcticbull wrote:
| > Only the critics look for this type of weird ideological
| purity. the rest of us just want somewhere to use the value
| we create.
|
| Yeah it's called the entire existing global financial
| network. You're creating things that have no value. Sorry,
| it's tough to hear, but you've been building baloney. Just
| building isn't good enough.
| RichardHeart wrote:
| One of the more ironic xposers, was a guy named "waronrugs" Who
| then went on to make a coin and rug everyone.
| https://twitter.com/Rekt_Tekashi/status/1394871896148172803?...
| [deleted]
| iamben wrote:
| Love Coffeezilla. Found his channel after someone posted his
| Tether expose on HN a while back - subscribed and have been
| watching ever since. He's genuinely entertaining, smart and fair.
| Very much recommended if you haven't seen any of his videos.
| photochemsyn wrote:
| I'd like to see someone like this really try to explain the
| global non-crypto currency system as it exists today in similar
| detail. This after all was one of the touted reasons for crypto -
| it would allow people around the world to hold wealth in a stable
| currency that wouldn't be subject to market crashes and currency
| devaluations.
|
| There are so many interesting questions that remain undiscussed -
| such as, to what extent does petrodollar recycling matter any
| more in terms of the value of the $USD relative to the euro and
| other currencies, such as Chinese and Japanese? If investing in
| crypto is a scam, why isn't investing in these other currencies
| also a scam? It would be nice to see some real in-depth compare
| and contrast writeups accessible to people who aren't
| professional currency traders etc.
| michael1999 wrote:
| You can't store wealth stably in inanimate things. Wealth is
| always social in nature. Currencies are claims on the future
| production of people who want them. Their future desires and
| capacities defines the value.
| SilasX wrote:
| Inanimate things like mutual fund shares?
| michael1999 wrote:
| Mutual fund units are a claim on future production. They
| connect to the the animate. A gold coin can never pay you a
| dividend.
| effingwewt wrote:
| Gold. Other precious/rare metals. Property.
|
| You are speaking of collectibles, not wealth/currency.
| michael1999 wrote:
| The natural rate of return "saving" in metals is negative.
| Rust, security, and other storage costs are real, and
| inanimate things provide no return to carry them. And
| property is only valuable in the context of social uses.
| Else why is land so cheap in Detroit?
| Ekaros wrote:
| Property isn't always good investment. How well Detroit and
| other communities where manufacturing went away are doing?
| shanusmagnus wrote:
| Gold's value is other people's belief in it being worth
| something, so they will trade other things for it. Same
| with other rare metals. Property has something close to
| intrinsic value in that it provides shelter, but the value
| of property is only realizable if the social context allows
| it to be realized -- your claim to a house is only as good
| as the government's willingness to recognize that claim,
| and to protect it for you when it is challenged by others.
|
| Point is, the devastating attacks people think they're
| lobbing at bitcoin when they say that it's not 'backed' by
| anything are neither devastating, nor unique to bitcoin:
| unless you're talking about a commodity that people are
| consuming directly, nothing is backed by anything other
| than socially held belief.
|
| That's all money is, when you unwind it all the way. The
| important question is what is the relevant society, and
| what beliefs do they hold?
| orwin wrote:
| The forex environment is barely less corrupt and scammy than
| the cryptocurrency environment. It does have legit use
| (arbitrage mostly) that are 'useful' for the global economy and
| production chain, but most of the guys pushing it to regulars
| people are crooks.
|
| And "investing" in a currency is a scam. It's like investing in
| an company with not only no profit, but also no sales.
| NineStarPoint wrote:
| * > If investing in crypto is a scam, why isn't investing in
| these other currencies also a scam? *
|
| I know very few people who recommend investing in currencies to
| begin with. You invest in either hard assets (intrinsic value
| that currencies get pegged against), productive assets
| (companies value that can increase as they become more
| productive) or government bonds (interest rate means you get
| more fiat currency back than you put in.) The advice for how
| much fiat currency to hold at any given time is to have an
| emergency fund and then put all other assets into something
| that can at the very least keep pace with inflation. The
| purpose of currency is to be a medium of exchange, not an
| appreciating asset.
| Banana699 wrote:
| The entirety of modern money seems to me like a scam.
| Questionable abstractions left and right, legal fictions left
| and right like there's no tomorrow. I started reading The
| Ascent of Money: A Financial History of the World by Niall
| Ferguson so that I can understand more, the first chapter
| explains Fractional Reserve Banking and... Holy Shit, that's a
| scam, no 2 ways about it.
|
| It's terrifying what Modern Money is and how it works. It
| scares and enrages me. It enrages me how the 'Store of Value',
| the things we exchange for our precious finite labor, is now
| whatever legal fan fiction that an influential someone at wall
| street or an equivalent finds a funny idea and convinces enough
| of his or her ilk to accept.
| simmerup wrote:
| When you use modern money you get the knowledge that the
| biggest militaries in the world are invested in maintaining
| its value.
|
| You don't get that with many other stores of value
| sanderjd wrote:
| > _If investing in crypto is a scam, why isn 't investing in
| these other currencies also a scam?_
|
| Isn't the answer to this that other currencies are backed by
| the might (both economic and military) of nations? I don't
| think mainstream blockchains like bitcoin and ethereum are
| scams, but this is an important distinction between sovereign
| currencies and cryptocurrencies.
| gostsamo wrote:
| Value exists only in the eyes of the buyer. Trying to lock
| value in whateverthing outside of the context of its use is
| exercise in creating false idols. And in that line of thought,
| central currencies have value just because the government says
| that they have value. As far as the common agreement is that
| governments are worth it, then central currencies will be the
| default stuff. This is the non-technological chain of trust
| that crypto bros are trying to fight. If they were not
| scammers, they would've noticed that this is the wrong place to
| attack it.
|
| Find something that can do government's job better than the
| government itself and its mechanism of value exchange will
| dominate the world. In the meantime, do not invest in scams.
| aww_dang wrote:
| Don't hold your breath waiting for The New Yorker to publish
| it. Expect something more along the lines of, "Central Banking:
| Why all detractors are conspiracy theorists, by Paul Krugman"
| z303 wrote:
| > I'd like to see someone like this really try to explain the
| global non-crypto currency system as it exists today in similar
| detail.
|
| There was a video and thread on 'How (inter)national money
| transfers works' a couple of months ago
|
| https://news.ycombinator.com/item?id=30540125
| low_tech_love wrote:
| Just because you don't understand how the traditional market
| works it doesn't mean it's a scam. Sure, there are scams, and
| sometimes they are big and problematic, but there is also a
| global network of honest people working, producing, creating,
| and selling real, useful things, and all that is connected by
| the global market. It is not perfect, but human beings aren't,
| so it will always be flawed, but the good things far outweigh
| the bad ones. Investing in crypto is not a scam by nature, in
| theory; it is a scam in practice. It is just how people use it,
| because there simply is no other use. The only reason someone
| buys crypto is to wait for it to grow, for whatever reason, so
| they can get rich easy. There is no other reason (right now) to
| expect crypto coins to grow in value other than speculation and
| hope. And scammers feed on that hope, that's just how it is.
| They are not that different, by nature, from the traditional
| market, but right the bad parts are exacerbated and there are
| no good ones to counterweight. Once cryptocurrencies are
| connected with enough real products, services, etc they will
| have a better reason to exist, and to become a better
| investment. After all a currency is just a way to trade things,
| it is not a value in itself.
| benreesman wrote:
| HN hasn't been this rabidly, vocally mad at something since
| levels.fyi outed FAANG comp.
|
| Ads? Evil, useless, fuck those people making 10x me. Recommender
| systems? Evil, creepy, fuck those people making all that money.
|
| You can short this shit. You can short Google stock. You can
| short Bitcoin.
|
| So if it's all one big phony ads tracking machine learning Ponzi
| scheme scam? Don't bitch and moan to the choir, profit from it!
|
| Repeating the same arguments ad nauseum on here takes calories
| you could be using grind leetcode and get that leet job. _ducks_
| [deleted]
| bigbillheck wrote:
| > Don't bitch and moan to the choir, profit from it!
|
| I'm not going to throw away whatever little dignity I have left
| in order to try and profit off of anything relating to
| cryptocurrency.
| randomhodler84 wrote:
| There is no dignity in watching your life savings evaporate
| from inflation caused by politicians and governments beyond
| your control.
|
| Inflation is the cruelest way to invalidate the fruit of the
| labor of a man's life.
| benreesman wrote:
| Cryptocurrency was a massive asset bubble two weeks ago.
| Also a year ago.
|
| But if anyone took the time to read about the history of
| tech startups and the culture around them over the last
| 50-ish years, or ECNs over the last 25-ish years: it would
| become immediately apparent that there is nothing new here!
|
| Most of "crypto" circa 2022 will wash out. Most of it is
| tulip-mania bullshit. And in fact, the well-traveled
| chestnuts (e.g. "when your shoe-shine boy starts asking for
| stock tips, hold, when he starts giving them: sell") date
| from the last time the robber/renter class kicked out this
| many rungs on the prosperity ladder and tried to paper it
| over with expensive bonds. As a society: been there, done
| that.
|
| But there is true innovation hiding in little corners:
| Parity has figured out how to roll an update to every nginx
| box in the world as the price of serving a web page via
| WASM! That would be huge news in any other context. And I
| wouldn't count the IO-HK people out just yet on beating
| dumbass Algorand PBFT.
|
| But just so the ground rules are clear: you want some
| inflation. Just ask the guy who bought a pizza for 1BTC in
| like 2013 or whatever. We used to kill each other and try
| to enslave continents over a limited supply of gold. The
| Spanish were especially good at this. Look at them now.
|
| If your roll is maintaining or increasing in value you have
| no incentive to back some profitable venture with it.
|
| Inflation out of control is a problem. Deflation is knights
| with swords fighting over mud.
|
| God I wish people read books.
| _vertigo wrote:
| Shorting something propped up by insane levels of hype is a
| recipe for massive losses. As they say, the market can remain
| irrational longer than you can stay solvent.
|
| Shorting things you disagree with morally is also a terrible
| idea, unless you also think they are bad business. I disagree
| with a lot of "money printing" tech on moral grounds, if I
| shorted those I'd be bankrupt.
| benreesman wrote:
| Sure, and for most people the right amount of short to be is
| just not long.
|
| My broader point is that HN is pretty selective on which
| "useless" or "evil" things it will _utterly lose its shit
| over_ and it seems to be, roughly, things where other hackers
| make a pile _except YC portfolio companies_.
| [deleted]
| paulpauper wrote:
| And yet the livestream giveaway scams persist on YouTube.
| Scammers earning so much. At any moment you can find at least 10
| videos running concurrently, each with money in the associated
| crypto addresses.
|
| The smart scammers are not doing NFT tomfoolery, they are doing
| fake Saylor and Musk giveaways instead and earning far more money
| much more consistently. While YouTube does nothing. Cofeezilla is
| not going to stop people from continuing to fall for these much
| more persistent scams. Its going to have to come from youtube.
| mrmuagi wrote:
| As long as there are stressed and/or gullible people, there is
| an avenue for these "smart scams".
|
| I distinctly remember getting junk spam physical mail as a kid,
| saying if you send back $60 dollars they will share the method
| to work from home / easy money scheme. It feeds on desperation
| and stress to hinder rational decision making skills.
|
| We also have things like the lottery where people buy in to the
| idea theres a infintismely small chance to actually win but the
| emotional side of the brain takes over and ignores it.
| TimPC wrote:
| Nextgrid wrote:
| Crypto has exactly one non-scam use-case: a way to transfer
| value that's more resilient to government interference. Can be
| used for crime, grey areas or in the _very rare_ case where
| there 's no other financial infrastructure to transfer value.
|
| Cryptocurrencies make various trade-offs around efficiency,
| energy use, user experience, etc to operate in such a hostile
| environment, therefore they should really be used as a last
| resort if there's nothing else that can achieve your objective.
|
| For most people living in the developed world and for whom
| government interference isn't a problem, there is no need to
| use cryptocurrencies.
|
| Anything else that's crypto/blockchain based but _not_ a
| cryptocurrency for the purpose of transferring value is a scam
| - whether to scam the _users_ (pump & dump, rug pull, etc) or
| to scam clueless investors who are happy to dump money into
| anything that uses a blockchain even though a database would be
| a better solution.
| 6sup6 wrote:
| After what the Canadian government managed to do with
| truckers crypto funds, I think it is more important than ever
| for people to understand what type of crypto to hold.
| colesantiago wrote:
| MPesa, Paytm, Worldremit, etc.
|
| All worldwide. No need for a blockchain. Ever.
| risyachka wrote:
| You obviously are not from a third world country. It is
| incredibly hard and often impossible to transfer money
| across borders from third world countries. Or even to store
| them reliably. So yes, there is a huge case for blockchain
| colesantiago wrote:
| So you can't transfer money across borders using MPesa
| and WorldRemit even though they have been there for 15
| years?
| risyachka wrote:
| You'd think the case is very rare, but then a war happened
| and it literally saved me as an instrument of storing value
| using stable coins. Not so rare after all. And this is only
| one example.
|
| Is 99% of crypto scam? Yes
|
| Are there hundreds of legit use cases? Yes.
| ouid wrote:
| Stablecoins didn't allow you to store your volatile
| currency. Stablecoins allowed you to store your volatile
| currency in an uninsured instrument at an interest rate of
| zero. They are _all_ scams.
| simondotau wrote:
| > _Crypto has exactly one non-scam use-case: a way to
| transfer value_
|
| And even then, its usefulness in this regard is limited when
| its valuation is highly volatile. Probably not an issue when
| the full transaction life cycle can be fully completed (buyer
| acquires crypto, buyer and seller trade crypto, seller
| offloads the crypto) in a matter of hours. But this narrows
| the use case even further.
| Nextgrid wrote:
| It's currently volatile because there's lots of hype about
| it. But when it all dies down the value would more or less
| stablize to the value it provides for its only true use-
| case.
| ouid wrote:
| Why do you think cryptocurrency solves this problem? Is it
| because you hope cryptocurrency solves some problem? It's a
| public ledger. All a hostile government has to do is find who
| performed the transactions and imprison them. Is that not
| considerable interference?
| Nextgrid wrote:
| There are non-public ledgers such as Monero.
| tromp wrote:
| Technology purist version:
|
| Is it a token on top of another blockchain? Yes -> scam. No ->
|
| Is it anything other than pure PoW? Yes -> scam. No ->
|
| Does it have a ICO/premine/instamine? Yes -> scam. No ->
|
| Do miners get less than 100% of block subsidy? Yes -> scam. No
| ->
|
| Is the source code mostly cloned from another project? Yes ->
| scam. No ->
|
| Is majority of supply emitted in first few years? Yes ->
| scammy. No ->
|
| Do creators have any expected financial gain? Yes -> scammy. No
| -> Maybe not a scam.
| rvz wrote:
| So essentially this [0] isn't totally a scam then?
|
| Ever since many Bitcoin clones and source derived projects
| with no other changes other a renaming, re-branding, block-
| size and tweaks and also now _especially_ with Ethereum-based
| tokens that have proliferated, so did the scams.
|
| Nano seems to qualify as _' not a scam'_.
|
| [0] http://nano.org
| SkyMarshal wrote:
| Do the creators and bag holders hijack every possible thread
| and discussion to shill their coin all over social media? Yes
| -> scam. No -> Maybe not a scam.
| simondotau wrote:
| _Sick of people calling everything in crypto a Ponzi scheme.
| Some crypto projects are pump and dump schemes, while others
| are pyramid schemes. Others are just standard issue fraud.
| Others are just middlemen skimming of the top. Stop glossing
| over the diversity in the industry._
|
| https://twitter.com/patdennis/status/1518637225789042688
| WesolyKubeczek wrote:
| You (or the tweet's author) seem to be very well versed in
| the fine art of distinguishing different sorts of poop.
| simondotau wrote:
| I would never call crypto poop. Poop can be combined with
| water and light to nourish plants which create food,
| something real and useful for humans.
| m3kw9 wrote:
| That's just insulting to ponzi!
| johnebgd wrote:
| Blockchain has two proven use cases:
|
| 1.) Speculative investment assets.
|
| 2.) Moving value outside of a financial system.
|
| Unregulated stable coins have proven to be as stable as the
| titanic was unsinkable.
|
| Number 1 is really a problem because of Number 2. Number 2 is a
| fancy way to describe a primary use case being money laundering.
| Of course though there are some instances where that's helpful
| like backing a foreign government you agree with. Unfortunately,
| it also means countries like North Korea can use it to evade
| sanctions.
|
| Blockchain is largely a solution in search of a problem with
| speculators throwing money into stuff they don't understand.
|
| I'm a reformed blockchain enthusiast.
| syzygyhack wrote:
| > Unregulated stable coins have proven to be as stable as the
| titanic was unsinkable.
|
| When in the last five years have you had difficulty cashing out
| USDT, USDC, or DAI at dollar value?
| Marazan wrote:
| Have you ever redeemed Tether?
|
| As opposed to selling it to another chump on am exchange?
|
| Have you ever taken your Tether holdings and redeemed them at
| Tether.io for US Dollars?
| [deleted]
| gruez wrote:
| My impression is that at certain exchanges that accept USDT
| (eg. bitfinex), you can withdraw your USDT for "real" USD
| wired to your bank account. Isn't this effectively
| redeeming it, even if you're not directly transacting with
| Tether Operations Limited?
| syzygyhack wrote:
| With a corporate account, not personal, but yes. They make
| it relatively simple. I don't imagine it's any different
| for an individual, aside from the verification process.
| arcticbull wrote:
| > When in the last five years have you had difficulty cashing
| out USDT, USDC, or DAI at dollar value?
|
| Wow, naming USDT was a bold choice since Paolo's answer as to
| why they can't tell you what backs it was almost verbatim
| what Skilling said when asked why Enron couldn't provide a
| balance sheet. [1]
|
| [1] https://www.youtube.com/watch?v=kp5kv7aENxw
| formerly_proven wrote:
| I thought I was listening to a podcast but it seems I
| accidentally stumbled into a butcher.
| polygamous_bat wrote:
| Because past performance is _always_ indicative of future
| performance, am I right?
|
| > When in the last five years have you had difficulty cashing
| out USDT, USDC, or DAI at dollar value?
|
| You could have said the exact same thing about Terra/UST
| right until sometimes last week. It works until it doesn't.
| syzygyhack wrote:
| 1. UST hasn't existed for 5 years, the others have.
|
| 2. "Algostable" coins are experimental, and this one was
| propped up by ponzinomics on Anchor. It is not comparable
| to collateralized stablecoins, and claiming otherwise is
| intellectually dishonest.
| stouset wrote:
| 1. The beanie baby craze lasted a bit shy of 5 years. 5
| years is _nothing_.
|
| 2. Collateralized stablecoins are stable insofar as they
| actually have enough liquid collateral to redeem. None of
| these coins have even remotely been tested yet.
| syzygyhack wrote:
| You don't think USDT holders have been scrambling to exit
| USDT over the last few days? Actually the sensible ones
| started cashing out around 1-2 months ago. You say that
| they have "not been remotely tested?" How are you
| quantifying that claim?
| arcticbull wrote:
| USDT can only be redeemed by non-US-person "authorized
| participants" as determined solely by Paolo Ardoino per
| their terms and conditions. Just who do you think these
| APs are? Best guess, they're exchanges, whose existence
| depends on USDT continuing to hold it's peg.
|
| Yes, I do think the holders have been scrambling to exist
| - one guy lost $4M trying to swap for USDT - but I think
| it's not Tether cashing it out, but instead exchanges
| eating the losses.
|
| That can only get you so far. The failure mode is a step
| function.
| SemanticStrengh wrote:
| no, terra is an algorithmic coin, the ones that are 100%
| backed by IRL assets are flawless
| arcticbull wrote:
| Depends on the assets doesn't it.
| tomrod wrote:
| Typically, past performance is indicative of future
| behavior. This is why statistical modeling in social
| sciences works somewhat okay. But there are extrapolation
| regions or shorter memory missing prior events that cause
| behavior to deviate from status quo expectation.
| polygamous_bat wrote:
| Yes, you could say that sometimes past performance can
| indicate future behavior, but it doesn't hold for crypto
| the same reason it doesn't hold for perpetual motion
| machines.
| everfree wrote:
| Algorithmic and partially backed stablecoins (like Luna's
| TerraUSD) are perpetual motion machines.
|
| Fully backed stablecoins (all other popular stablecoins
| with the arguable exception of Tether) are not perpetual
| motion machines.
| austinkhale wrote:
| What do you mean "fully backed"? The last time I checked
| on USDT (which was a while ago) I thought they admitted
| it was a fractional reserve, primarily denominated in
| undisclosed commercial paper. Additionally, they had not
| yet received an unqualified audit report from any of the
| big four. Has something changed in the last year or so?
| everfree wrote:
| As I said, Tether (USDT) is an arguable exception. You
| seem to be arguing that exception. I don't disagree with
| you.
| low_tech_love wrote:
| I'm genuinely curious, can you point me to credible
| information showing that some other stablecoin is
| actually fully backed?
| everfree wrote:
| USDC backing, audited by a large US accounting firm:
| https://www.centre.io/usdc-transparency
|
| GUSD backing, also audited by a large US accounting firm,
| subject to New York State Department of Financial
| Services regulations:
| https://www.gemini.com/cryptopedia/gusd-stablecoin-
| gemini-do...
|
| USDP backing, also audited by a large US accounting firm
| and subject to New York State Department of Financial
| Services regulations: https://paxos.com/usdp/
|
| DAI backing, viewable transparently on-chain. Currently
| backed 168% by collateral:
| https://daistats.com/#/overview
|
| LUSD backing, viewable transparently on-chain. Currently
| backed 189% by collateral: https://dune.com/dani/Liquity
|
| UST (Terra/Luna) and USDT (Tether) have/had nothing like
| this.
| polygamous_bat wrote:
| Tether is the largest stablecoin in existence. If you are
| intent on arguing that the biggest example of your
| mentioned category is an exception, how do you propose
| the average person goes about find out what's an
| exception and what's following the norm?
| everfree wrote:
| Picking any regulated, US-based stablecoin is a great
| start.
|
| https://news.ycombinator.com/item?id=31381864
|
| Tether is large because it got a head start on network
| effect before the proper regulatory frameworks were put
| into place, in the USA at least. There's a massive amount
| of momentum there even though their product is inferior.
| [deleted]
| [deleted]
| [deleted]
| arcticbull wrote:
| Have you heard the tale of the inductivist turkey and
| thanksgiving? This turkey found that, on
| his first morning at the turkey farm, he was fed at 9
| a.m. However, being a good inductivist, he did not jump
| to conclusions. He waited until he had collected a large
| number of observations of the fact that he was fed at 9
| a.m., and he made these observations under a wide variety
| of circumstances, on Wednesdays and Thursdays, on warm
| days and cold days, on rainy days and dry days. Each day,
| he added another observation statement to his list.
| Finally, his inductivist conscience was satisfied and he
| carried out an inductive inference to conclude, "I am
| always fed at 9 a.m.". Alas, this conclusion was shown to
| be false in no uncertain manner when, on Christmas eve,
| instead of being fed, he had his throat cut. An inductive
| inference with true premises has led to a false
| conclusion. (via Alan Chalmers, What is this thing called
| Science, 2nd edition, University of Queensland Press, St.
| Lucia, 1982)
| SilasX wrote:
| Have you heard of faster ways of conveying the insight
| that "turkeys seem safe until the day they get
| slaughtered" and less toxic ways of formatting quotes?
|
| And was it a fully general argument against induction, or
| do you disagree with the conclusion you were promoting?
| Jerrrry wrote:
| "The reaper didn't come today, so he won't tomorrow"
| IshKebab wrote:
| ... is a pretty good approximation.
|
| The problem is that you don't care if a stablecoin
| collapses _tomorrow_ ; you care if it collapses in the
| next 50 years and "the stablecoin hasn't collapsed in 50
| years so it won't collapse in the next 50 years"
| obviously doesn't apply.
| everfree wrote:
| For technology, that assumption is more likely than not,
| in a general sense.
|
| https://en.wikipedia.org/wiki/Lindy_effect
| tdub311 wrote:
| Value of an asset doesn't really count as technology
| though. The technology of UST/Luna still "works" even
| though the value crashed.
| everfree wrote:
| UST was intended to be a dollar-pegged stablecoin. The
| failure of its dollar peg was certainly a failure of
| technology, because a "dollar-pegged" coin that is not
| actually pegged to the dollar is not a "working" system.
| z9znz wrote:
| The thing is, you're right many times until you're wrong.
| Unfortunately when you're wrong, it can be catastrophic.
| low_tech_love wrote:
| If you can't learn from examples, I guess you're gonna have
| to learn by experience.
| lpolovets wrote:
| I disagree strongly that moving outside of the financial system
| is primarily used for money laundering. Bitcoin is great for
| censorship resistance, and for offering an alternative to
| oppressive monetary policies. Here's a good article touching on
| some of the use cases outside of the US:
| https://bitcoinmagazine.com/culture/check-your-financial-pri...
|
| In the long run, I hope Bitcoin's existence will also lead to
| better monetary policies since governments have always assumed
| a monopoly on money, and now there's finally some true
| competition. And competition leads to better outcomes for
| consumers/citizens.
| 8note wrote:
| Currencies did a lot of centralizing on their own. One
| currency is much more useful to its owner than 500.
|
| Ain't nobody want to spend time converting from the 500 down
| into one so they can buy an expensive widget that only
| accepts a specific currency
| clippablematt wrote:
| Stablecoins without collateral backing them have repeatedly
| failed (and they failed when they were tried before crypto
| too), but dai/rai/usdc are working fine.
|
| At this point I'd like to sees US regulation around $
| stablecoins so we can use something else and reduce the power
| of the US dollar in the world. Go ahead America, regulate
| yourselves.
| SemanticStrengh wrote:
| > they failed when they were tried before crypto too
|
| do you have references to non-crypto based coins? also recent
| ones?
| paulpauper wrote:
| The main value proposition of crypto is cryptographic security.
| You cannot confiscate crypto like you can other assets (unless
| obv. you have the key or miners somehow collude). Is this worth
| $1 trillion? Probably not.
| _aavaa_ wrote:
| https://xkcd.com/538/
| stouset wrote:
| > You cannot confiscate crypto like you can other assets.
|
| You're correct. In most cases it's dramatically easier to
| confiscate the crypto. See: the horde of people who've had
| their cryptocurrency and NFTs stolen. To say nothing of the
| uncountable Bitcoin billionaires who've had a hard drive
| crash, lost their keys, forgotten a password, etc.
| paulpauper wrote:
| this is not the same as the cryptography being broken
|
| losing crypto due to hardware failure or forgetting keys is
| not the same as someone taking it by breaking the
| cryptography . If this were possible, there is tons of
| crypto right now for the taking. It's a self-funding bug
| bounty.
| polygamous_bat wrote:
| Yes, but being cryptographically broken is not matter,
| does it? First rule of computer security is any system is
| no more strong than its weakest link.
|
| Relevant xkcd [1]: why worry about breaking advanced
| cryptography when you can just socially engineer the
| passphrase out of people?
|
| [1] https://xkcd.com/538/
| jxi wrote:
| yowlingcat wrote:
| > Number 2 is a fancy way to describe a primary use case being
| money laundering.
|
| That's not entirely true. I think a more principal use case for
| Number 2 is purchasing things (dark web drugs, gambling, etc)
| outside of the usual centralized financial system rails which
| would stop them at the edges.
|
| Bitcoin seems like a poor choice for money laundering because
| of how traceable it is; you'd need to use privacy coins for
| that, and even then, it's questionable (51% attack is doable in
| the same way that many Tor nodes are compromised).
| nyolfen wrote:
| your talking points are from like 2012 man. off the top of my
| head: remittances, online retail, trustless decentralized
| computational systems
| low_tech_love wrote:
| A trustless descentralized system that manages to process a
| handful of operations a second by spending as much energy as
| a country?
| messutied wrote:
| Can you link a couple of sources that show companies that
| successfully leverage this use cases?
| dubswithus wrote:
| https://brave.com/transparency/
| nyolfen wrote:
| i run a small retail business that only accepts crypto and
| it's been doing fine
| low_tech_love wrote:
| Could you tell us why you chose to do that?
| dghlsakjg wrote:
| What do you sell/provide?
| arcticbull wrote:
| Is it a small laundromat, or do you just not want to
| accept money from all customers?
| alexb_ wrote:
| Remittances and online retail is already done quite well with
| centralized systems. "Trustless decentralization" is only
| relevant when you are doing things illegal. Which, as it
| turns out, is the main usecase of cryptocurrency.
| ada1981 wrote:
| I thought this too, but then looked into and saw that fiat
| currency use for illicit things is an order of magnitude
| more then crypto (as a percentage of total use).
| nyolfen wrote:
| this is the exact same argument as politicians saying that
| encryption is only useful for child pornographers
| tshaddox wrote:
| "Nothing to worry about if you've got nothing to hide" goes
| back even further than 2012.
| Ekaros wrote:
| And does the mainstream crypto outside Monero help you to
| hide things? You are still dealing with some actors and
| surely they keep records if you don't solely do face to
| face activities. In which case why even bother and not
| just go with Euros or dollars...
| alexb_ wrote:
| That has absolutely nothing to do with what I'm saying.
| What I am saying is that cryptocurrencies are so horrible
| in every way except anonymity that the ONLY reason you
| would use it is for illegal activities, speculation, or
| paranoia.
| runarberg wrote:
| It isn't even that good at anonymity for the most
| frequent use case compared to alternatives. By far the
| most transactions that may benefit anonymity are local
| and involve relatively low values. Cash is a perfect fit
| for that and gives you even more (and a lot easier)
| anonymity then cryptocoins.
|
| Cryptocoins only prove them selfs superior if the
| transaction is located to far away to conveniently
| travel, or involves such large sums that gathering or
| carrying as cash becomes inconvenient (or impossible). I
| would think that over 99.99% of people never engage in
| such transactions where they additionally require--or
| even prefer--anonymity.
| SemanticStrengh wrote:
| zero knowledge proofs have other uses, for example proving
| to your family members no-one has bought the same gift for
| the same person, without revealing the nature of the gift.
| paulryanrogers wrote:
| Trustless or distributed trust (up until the point of a 51%
| attack)?
| nyolfen wrote:
| fair enough, but in the same way that conventional systems
| are only 'secure and encrypted up until the point of being
| beaten with a wrench'
| polygamous_bat wrote:
| Maybe people wouldn't repeat the 2012 talking points 10 years
| later if crypto had improved in any way since then. But no,
| all that has happened is the growth of a massive speculative
| bubble on top, while the fundamental issues remain the same.
| low_tech_love wrote:
| What do you mean it's a "solution in search of a problem"? It
| solves a very clear problem: lack of scalability of traditional
| Ponzi schemes. That's why most of the answers to criticism of
| cryptocurrencies is usually "it's not much worse than the kind
| of thing that led to the 2008 crash". For crypto enthusiasts
| the problem is not that scams exist; it's that they didn't get
| to join them early enough.
| colesantiago wrote:
| Coffeezilla is right.
|
| ALL crypto is 100% scams. There is no 99%.
|
| In fact 100% of the time, they have no use case at all and they
| are even worse than the current system.
|
| Crypto has totally failed time and time again to prove itself.
|
| We now need to come to terms with this failed experiment and call
| it all off and make them all illegal, where it rightfully should
| reside in.
|
| I lament to think of the time wasted of many engineers building
| this distributed casino and ruining people's lives, these
| engineers in this 'web3' space should instead direct their time
| towards solutions to make the world a better place.
| crispyambulance wrote:
| Not 100%, but just as bad.
|
| I'd say that is wild mix with hard-to-measure ratios of...
|
| * scammers and crooks - who are attracted to crypto like flies
| on s***.
|
| * the naive marks of scammers - who the scammers (and everyone
| else) are extracting from
|
| * true believers - who find value in the concepts. They're
| willing to overlook the s* _-show and actually believe in a
| libertarian pipe-dream of a better future with crypto as money.
|
| * amoral speculators - who could not care less wtf crypto means
| but just want to dip-and-pull. They're "in it" ONLY insofar as
| they can convert the funny-money into real-money._
| terafo wrote:
| > `"I try not to be too negative about crypto," he told me. "I
| think about how we can shape it into something better--more
| like the future that the people making it say they want. In
| that way, we're on the same side."`
|
| Have you read the article?
| ratsmack wrote:
| The whole "proof of work" concept regarding crypto is a sham.
| Normally, the expenditure of energy produces tangible products
| or services. In the case of crypto currency, massive amounts of
| heat is wasted to produce a number with questionable "value". I
| just can't wrap my head around this.
| shreyshnaccount wrote:
| I've been thinking for a while that proof of work should be
| replaced with some other type of real work, such as training
| a Neural Net, but that runs into major issues after thinking
| about if for more than a second. Hopefully though, someone
| much smarter than me can figure something out
| ratsmack wrote:
| The "value" must be produced outside of the crypto system
| then moved into the system as a value store. I don't know
| how this is not an obvious concept.
| shreyshnaccount wrote:
| Thats one of the very obvious drawbacks.. Money is a
| store of value, but crypto just tries to 'be' the value,
| which doesn't go well, because well it's not valuable at
| all
| tromp wrote:
| It produces objective immutability of the transaction
| history.
| 8note wrote:
| Isn't it subjective immutability?
|
| Your transaction might disappear from the history if the
| view changes to have some other branch be the accepted one
| tromp wrote:
| The PoW on top of a tx produces immutability in the sense
| of a minimum cost imposed on a rewriting of that tx. If
| no attacker is willing to bear that cost, then the
| objective longest chain rule (i.e. most cumulative
| difficulty) will preserve the history up to that tx.
| Without PoW you have no objective way to determine the
| true history.
| SrslyJosh wrote:
| It's a terrible way of doing that, and it isn't even
| necessary to produce an immutable record of transactions.
| Seriously, spend some time thinking about other models for
| distributed transaction records.
|
| Blockchains are designed the way they are to _prevent_
| governance and oversight, meaning, if someone scams you or
| steals from you, there 's no way to get your money back.
| "No backsies" is the most fundamental principle of their
| design.
| glerk wrote:
| > We now need to come to terms with this failed experiment and
| call it all off and make them all illegal
|
| Who is "we"? Ironically, crypto was invented to protect
| individuals against the authoritarian tendencies of people such
| as yourself. Your comment is making the case for
| decentralization.
| mdoms wrote:
| "We" would be any nation with legitimate climate targets.
| lvass wrote:
| >crypto was invented
|
| What are you talking about? David Chaum? NSA? Mesopotamian
| cryptography?
| glerk wrote:
| We stand on the shoulders of giants
| mechanical_bear wrote:
| This is the problem with the internet, it's so hard to tell
| satire from actual cranks.
| Tesl wrote:
| I don't know whether its attempted satire or not - but I
| unironically agree with it 100%.
| hckrnrd wrote:
| Now, I wonder if this isn't just a pot-calling-the-kettle-
| black comment. Who's the crank? Who's the satirist?
| zakember wrote:
| In case you didn't read the article, it clearly mentions that
| Coffeezilla himself owns some Bitcoin. So no, he doesn't think
| that "all crypto is 100% scams".
| imperio59 wrote:
| Peak Silicon Valley. Shit on the latest trend. Say engineers
| should "make the world a better place.". Well done.
| awsrocks wrote:
| tzumby wrote:
| I think I shared this on HN before, but highly recommend this
| podcast: https://cryptocriticscorner.com/
|
| It covers Worldcom all the way up to the recent Terra
| TimPC wrote:
| I think the one university that closed in Illinois due to a
| ransom attack made possible by Crypto will in the long run prove
| to be more valuable to society than all of crypto. If only we had
| some way of preserving all the things crypto destroys.
| dubswithus wrote:
| Was ransomware really not a thing before Bitcoin?
| TimPC wrote:
| It was far rarer because it was much more difficult to
| collect payments.
| randomhodler84 wrote:
| It was rarer because we had less computers and less
| interconnectness. Major incidents are caused by supply
| chain compromise, or very targeted attacks, all of which
| gets worse as the population grows.
|
| Taking payments over the internet has been fairly easy for
| decades. If not, do you really think we would be where we
| are today.
|
| I get you like to blame cryptocurrency on crime, but it is
| but a component, of which other components are just as
| critical and yet we cannot have a modern digital society
| without them.
| TimPC wrote:
| Taking regulated payments subject to financial law as a
| Russian hacker group is quite difficult. Bitcoin is used
| in nearly all ransomware attacks precisely because it is
| unregulated. The idea that they'd just take PayPal
| without Bitcoin is laughable.
| polygamous_bat wrote:
| It may have, but crypto allowed it to become truly scalable.
| Before, you had to coordinate with each of your victims about
| how to receive the ransom while trying to evade the
| authorities. Now you can just take over a random machine,
| paint a Bitcoin address on the screen, and voila, you're
| done.
| randomhodler84 wrote:
| Except it doesn't really work that way these days. The bad
| guys run onion payment sites where you exchange an id and
| get a unique address -- they still need to coordinate with
| the victims.
|
| And before cryptocurrency was big, it was shady credit card
| gateways in non-friendly jurisdictions. You cannot blame
| cryptocurrency any more than you can blame onion routing,
| encryption or the internet. It's all just tech that is
| evolving and getting more efficient.
| sremani wrote:
| Coffeezilla will hate this, but he is Tai Lopez of Scam-busting
| ;)
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