Cryptobollocks

[touchingcloth]

I received an email from PayPal today:

Hi cloth,Take [sic] your first steps into the world of digital currency with PayPal.

I took it fifteen years ago, by joining PayPal, cos that's literally why your business was founded. What?

You can buy, sell or hold as little as £1 of crypto, right in your PayPal wallet. ‌

Oh.

This is after months of them sending me emails saying DO YOU WANT TWENTY GRAND CREDIT WELL GOOD BECAUSE YOU HAVE BEEN PRE-APPROVED FOR TWENTY GRAND CREDIT.

I for one am glad that after the blip of 2007 that responsible lending is back, with planet-burning truffling for digital pennies to boot.

Randolph. Oi! Randolph! Email cloth and offer him as little as £1 of pork belly futures.

[bgmnts]

It's pure gambling and arbitrary bollocks right so I say buy £1 of crypto and by next week you could be a millionaire somehow.


Disclaimer: I know nothing about economics.

[gib]

take the twenty grand they're offering and put it into crypto

[imitationleather]

take the twenty grand they're offering and put it into crypto

Fuck that. Take the twenty grand they're offering and give it to me!

[touchingcloth]

It's pure gambling and arbitrary bollocks right so I say buy £1 of crypto and by next week you could be a millionaire somehow.


Disclaimer: I know nothing about economics.

I could be a millionaire or a pound poorer.

[beanheadmcginty]

Is this a general purpose cryptobollocks thread? If so, get a load of this:

https://www.coindesk.com/business/2022/04/13/jack-dorseys-first-tweet-nft-went-on-sale-for-48m-it-ended-with-a-top-bid-of-just-280/?outputType=amp

Hahahahahaha.

[Sebastian Cobb]

Is this a general purpose cryptobollocks thread? If so, get a load of this:

https://www.coindesk.com/business/2022/04/13/jack-dorseys-first-tweet-nft-went-on-sale-for-48m-it-ended-with-a-top-bid-of-just-280/?outputType=amp

Hahahahahaha.

It's such a pit of snakes lol.




https://twitter.com/0xQuit/status/1511198290565509120

[Paul Calf]

The actual assets have so little value or authenticity that it's easy to pass off other types of junk as this type of junk. That's the problem. It's nothing to do with UX or UI issues, it's that they're trading in garbage.

[Pinball]

Scam city, but I guess there's fuck all else you can buy with crypto.

[JesusAndYourBush]

If someone had a large amount of money in crypto, how easy would it be to get it in real money?
Like say you've got a million pounds in bitcoin, is a bank really going to give you a million in real money?

[Wonderful Butternut]

Afaik, you need to sell the bitcoin on a dependable crypto exchange service if you want the £1m. There are third party services that let you do your shopping with it (they take your bitcoin and pay the vendor in real money) although I have  no idea how widespread the acceptance of that is.

With bitcoin (& probably ethereum) cashing out for real money is not a major issue atm, although you'll pay a commission and may be limited to only being able to liquidate a certain amount of them within a certain time period.

But the system as is relies on continued demand for bitcoin from cash buyers in order to make it possible to exchange it for real money easily. So once the numbers stop going up, there might be a problem.

With smaller cryptos no one will give you actual money directly cos half of them are scams, you have to hope there's still demand for them so you can sell them for bitcoin and then cash that out.

[JesusAndYourBush]

I don't have any by the way.  It's just all this talk of people buying silly shit was making me wonder if liquidation was a problem and it was easier just to muck about buying and selling crappy pictures.

[touchingcloth]

If someone had a large amount of money in crypto, how easy would it be to get it in real money?
Like say you've got a million pounds in bitcoin, is a bank really going to give you a million in real money?

As I understand it, it depends to a large extent which wallets/accounts the source of the tokens had passed through. People use "tumblers" to obfuscate their tokens for all sorts of reasons - some legitimate, and some not - but because it makes it difficult to see where they've been, banks which need to follow anti-money-laundering (AML) rules may refuse withdrawals to cash. "Know your customer" (KYC) rules that some financial institutions are obligated to follow can also hinder this, because if you have access to an anonymous wallet they won't allow for cash to be withdrawn without knowing who you are, probably also taking into account the obfuscation bit to know where the money in your wallet originally came from.

You can't directly deposit cryptocurrency in your bank in order to withdraw it as cash, so people tend to use cryptocurrency "exchanges" which will let you deposit your tokens and will make a transfer to your bank account. The big exchanges will require you to provide identity documents first cos of AML/KYC, so aren't very useful for people wishing to cash out anonymously. Some exchanges will allow for anonymous cash transfers, but the industry is totally unregulated so it's entirely possible that they'll take your tokens and not give you any money in return, and there are stories out there of banks who have frozen funds transferred that way because of AML laws. Other exchanges offer peer-to-peer withdrawals, in other words transfer your tokens to a person you've arranged to meet in public with a sack of money.

The only real use of "a million pounds" of Bictoin other than buying a ton of drugs or weapons from the dark web (assuming they can be trusted to actually mail them out to you, which, in fairness, seems to be less of an issue than it is for buying tech goods on Amazon and eBay) is to buy "a million pounds" of another cryptocurrency or a jpeg of a wanking chimp.

[touchingcloth]

With bitcoin (& probably ethereum) cashing out for real money is not a major issue atm, although you'll pay a commission and may be limited to only being able to liquidate a certain amount of them within a certain time period.

There are issues with transfer times, so with the markets being so volatile the amount you transfer may have changed at the point of withdrawal, depending on at which point a given exchange will honour the exchange rate to cash.

But the system as is relies on continued demand for bitcoin from cash buyers in order to make it possible to exchange it for real money easily. So once the numbers stop going up, there might be a problem.

Yep. It's a hybrid ponzi/pyramid scheme at the moment. If the actual input currency stops going up, the exchanges don't keep it on their books (there's no legislation saying that if someone deposits £10 in your exchange that you need to keep liquid assets of that value), the likelihood is that there would be a run on that particular token with people scrambling to cash out while they can, and those people who are last to get out are left holding tokens which are worthless in nominal and/or actual cash-outable value.

This is the same situation that actual proper banks found themselves in in 2007, of course, so there's an interesting question of whether Bitcoin is Too Big To Fail and would get bailed out in that sort of an eventuality, but my hunch is that the owners of Bitcoins would end up more like the victims of Madoff and the Names of Lloyds.

[JesusAndYourBush]

The only real use of "a million pounds" of Bictoin other than buying a ton of drugs or weapons from the dark web (assuming they can be trusted to actually mail them out to you, which, in fairness, seems to be less of an issue than it is for buying tech goods on Amazon and eBay) is to buy "a million pounds" of another cryptocurrency or a jpeg of a wanking chimp.

It had got me thinking that people with the sort of amounts like that guy claimed to have on the hard drive that was lost at the local tip would have big problems actually cashing out.  It'd probably be easier buying goods with it then re-selling the goods.

[The Ombudsman]

It had got me thinking that people with the sort of amounts like that guy claimed to have on the hard drive that was lost at the local tip would have big problems actually cashing out.  It'd probably be easier buying goods with it then re-selling the goods.

If you can find someone wanting to buy £1m I guess it would be easy to sell. I don't think if you have say £100 worth of ETH or BTC you have to sell the whole lot, so they would likely not want to flood the exchange (bring the price down) but sell bits off in blocks.

If you wanted to liquidate it quickly you would need someone wanting to buy the lot.

I say all this however know very little about these things. I just know I sold some ETH years ago in two transactions. Think it was about £400 in the end so much easier to get rid of.

[touchingcloth]

It had got me thinking that people with the sort of amounts like that guy claimed to have on the hard drive that was lost at the local tip would have big problems actually cashing out.  It'd probably be easier buying goods with it then re-selling the goods.

Yeah, I'm not aware of any goods that you'd want to buy in huge quantities or values that you could actually buy with Bitcoin. It would be one thing if you could buy houses and cars or luxury holidays with them (notwithstanding that you probably actually can, if you find someone willing to do the trade), but in terms of useful stuff you're limited to relatively small scale cash withdrawals, and buying things like drugs with your money. If you held a nominal million pounds in Bitcoin, you'd have to have a certain type of personality and tolerance for risk to make blowing the lot of it on drugs seem like it would be worth the hassle of becoming Scarface.

[Wonderful Butternut]

Yep. It's a hybrid ponzi/pyramid scheme at the moment. If the actual input currency stops going up, the exchanges don't keep it on their books (there's no legislation saying that if someone deposits £10 in your exchange that you need to keep liquid assets of that value), the likelihood is that there would be a run on that particular token with people scrambling to cash out while they can, and those people who are last to get out are left holding tokens which are worthless in nominal and/or actual cash-outable value.

This is the same situation that actual proper banks found themselves in in 2007, of course, so there's an interesting question of whether Bitcoin is Too Big To Fail and would get bailed out in that sort of an eventuality, but my hunch is that the owners of Bitcoins would end up more like the victims of Madoff and the Names of Lloyds.

Absolutely. Unless there comes a time where you can directly purchase¹ real, tangible goods en masse with crypto, every cryptocurrency will eventually shit itself at some point, no matter how big it is. Without being usable as real world currency, the ultimate reason to invest in it is speculation on future value. Even if a person is buying actual tangible goods with it now, somewhere along the chain of people that enable them do that, there is someone relying on the value of crypto going up to make a profit. If they can't do that, the chain collapses and the crypto debit cards will suddenly cease working in Sainsbury's or wherever.

There's a finite amount of outside investment that can be put into crypto, and once that limit is reached and outside investment ceases and the trend stops going up, liquidity in the market will disappear and people will not be able to cash out rendering their shitcoins valueless. It's just a matter of when and how.

Like you, I don't think anyone will be bailed out, if for no other reason than it'd suit most governments for crypto to never be an actual properly functioning currency.

_{1:ie. not through a third party who have to sell the crypto you give them for real money in to function as a business and make a profit}

[touchingcloth]

Absolutely. Unless there comes a time where you can directly purchase¹ real, tangible goods en masse with crypto, every cryptocurrency will eventually shit itself at some point, no matter how big it is. Without being usable as real world currency, the ultimate reason to invest in it is speculation on future value. Even if a person is buying actual tangible goods with it now, somewhere along the chain of people that enable them do that, there is someone relying on the value of crypto going up to make a profit. If they can't do that, the chain collapses and the crypto debit cards will suddenly cease working in Sainsbury's or wherever.

There's a finite amount of outside investment that can be put into crypto, and once that limit is reached and outside investment ceases and the trend stops going up, liquidity in the market will disappear and people will not be able to cash out rendering their shitcoins valueless. It's just a matter of when and how.

Like you, I don't think anyone will be bailed out, if for no other reason than it'd suit most governments for crypto to never be an actual properly functioning currency.

_{1:ie. not through a third party who have to sell the crypto you give them for real money in to function as a business and make a profit}

I think digital currency will become a thing used by governments eventually, but blockchains seem to be a particularly bad way to implement them unless you're a dyed in the wool libertarian. They're just databases, for fuck's sake. Arguably central banking already runs on digital money, in most senses that have any meaning.

There's a bit of a disconnect in the thinking of cryptocurrency advocates, assuming they aren't aware that it's a ponzi. Do they want it to be seen as an actual currency which doesn't have intrinsic value and should not increase in value indefinitely but is used to help people transact, or do they want it to be a speculative asset which does have an inherent value which in theory can become infinitely valuable over time like a stock in a public company? It can't be both, and if your primary interest in holding Bitcoins is getting rich quick knowing full well that ultimately that will be at the expense of people who lose their investments then you're a cunt.

[Zetetic]

I think digital currency will become a thing used by governments eventually

Digital renminbi is in public testing, for example. (And uses centralised databases, of course.)

[Sebastian Cobb]

If someone had a large amount of money in crypto, how easy would it be to get it in real money?
Like say you've got a million pounds in bitcoin, is a bank really going to give you a million in real money?

Depends on the history of the coins (which is an immutable public record)

https://blog.mollywhite.net/off-ramps/

[Sebastian Cobb]

Yeah, I'm not aware of any goods that you'd want to buy in huge quantities or values that you could actually buy with Bitcoin. It would be one thing if you could buy houses and cars or luxury holidays with them (notwithstanding that you probably actually can, if you find someone willing to do the trade), but in terms of useful stuff you're limited to relatively small scale cash withdrawals, and buying things like drugs with your money. If you held a nominal million pounds in Bitcoin, you'd have to have a certain type of personality and tolerance for risk to make blowing the lot of it on drugs seem like it would be worth the hassle of becoming Scarface.

The link in the d last post I posted describes someone laying their coins for collateral to borrow for a house, but the lenders didn't like the history so revoked it after the fact leaving mateyboy hundreds of thousands in debt.

In February 2022, a Bitcoin holder decided to try to use a cryptocurrency lending platform called BlockFi to take out a USD $300,000 loan, putting up the equivalent of $600,000 in Bitcoin as collateral. However, the BTC he bought didn't come from an exchange—he said that he bought it from a "private source", and that he chose that route after reading the Bitcoin whitepaper (which touts the privacy benefits of cryptocurrencies). It turned out that the "private source" had passed them through a cryptocurrency mixer—a technology that helps obscure the source of funds, and as such is used for legitimate privacy reasons as well as by criminals to "clean" funds that are known to be stolen or otherwise tainted.3 BlockFi called back the loan, and the holder found themselves $300,000 poorer with little recourse.4

[touchingcloth]

Depends on the history of the coins

(which is an immutable public record)

https://blog.mollywhite.net/off-ramps/

Pseudo-immutable, subject to the specific token, and specifically whether it can be (agreed to be) forked, and things like 51% attacks.

Making a database both open access and immutable by design is a terrible, terrible, terrible idea.

[touchingcloth]

I still find it absolutely mad that PayPal are encouraging their users to do this. Like if NatWest sent me a letter asking if I'd considered taking out a loan to have a trial of Paddy Power.

[SOMK]

This is good (albeit extremely long and thorough) on the whole NFT thing, confirms much of what's been said above, but goes into very specific detail on the hows, whys and whats. Particular interesting I found was that all those meme people who sold a NFT (like the overly obsessive girlfriend lady who sold the picture of their face) had to pay a few hundred quid to register the NFT and never cashed it out (maybe believing that it would go up in price infinitely?). From the outset it looked like classic pump and dump stuff, a small bunch of wealthy reasonably tech savvy people buying nonsense off each other to jack up the price before dumping it on the suckers.


'Smart' money left crypto like a shitting dog and went in on commodities at the turn of the year. It's a side effect of the kind of massive systemic inequalities that allow Bezos to make more money in a few days than the richest person on the planet had circa 1995. That money seeks returns and often ends up in the most inefficient places imaginable. Case in point after the Prussian Franco war, the reparations Prussia placed on France didn't cripple France but instead crippled Germany, because that money ended up pilling into fixed assets and bloating prices leading to a crash, whereas France was able to pay off the war debt relatively easily.  https://carnegieendowment.org/chinafinancialmarkets/58983

Amusingly the thing that gave crypto its value in the first place, ie. that you can use it to buy drugs (much like how greenbacks became legal tender when Lincoln said they could be used to pay taxes) is looked upon with scorn by crypto bros types. Then again, people do make money off it, I guess fair fucks and all that if you can, don't think it's worth the mind pollution personally.

[Martin Van Buren Stan]

I know NFTs are a scam but how is it any different to paying $50 mil for an original Rothko when you can buy an identical print for $50?

[Wonderful Butternut]

With the Rothko, you at least have physical possession of the original item. Whether it's worth $49,999,950 more than having a copy is debatable, but at least you have it. It's also more likely to hold it's value than an NFT.

With the NFT you don't get any physical item, you get a digital receipt saying you own it. Also NFTs were conceived simply to induce people to buy crypto, not for any inherent artistic value they might have.

[Sebastian Cobb]

With the Rothko though the duplicates are kind-of different to the original, and someone owns the one that was painstakingly painted, in the digital world the 1's and 0's are still duplicated exactly, there's no original .jpg that was agonised over, what you really own is a signed receipt that says "this is my .jpg, there are many like it but this one is mine".

[touchingcloth]

I think NFTs are a bit of an attempt to find a reason to justify blockchain as a technology. It's not crap, we just haven't found the right application yet!

[Sebastian Cobb]

13 years and counting for that killer app