At this point, I wouldn't touch crypto with a 10 ft pole. What happens when everyone recognizes that the whole thing has turned into a money laundering grift? Who's going to give you anything for your bozo bucks? At this rate, it's not going to take long.
Hasn't that been apparent for years now though? It's a cool idea but really no real use that doesn't boil down to some sort of crime
Maybe there's an alternate timeline where crypto was legalized and regulated into something like fair gambling... but that's not what we're getting. Anyone getting into crypto now is just a sucker to be milked dry.
Yeah, I don't think the dominos will fall until the next flash crash when people realize it takes $100+ just to withdraw (because 7 transactions per second isn't many). As soon as confidence is lost, the reaction will be full blown tulip market. We just haven't seen the first bank run yet. And there is literally no backstop for a crypto bank run.
It doesn't take $100 to transfer. Fees are currently around $1. You are off by a factor 100!
Also, Bitcoin can process far more than 7 tps through the Lighting network.
I wonder where your misconceptions come from?
>Fees are currently around $1.
Fees are CURRENTLY around $1 because no one is using the L1 network. There is no demand now because of all of the times when the transaction fees were $30.
>Also, Bitcoin can process far more than 7 tps through the Lighting network.
The lightning network is insecure during periods of high demand because you aren't able to safely close channels. Also, you still need to fund channels on L1 in the first place!
Agreed. Currently is the key there. I was referring to whent a run starts. It's been at $100 before and we haven't even seen a serious run yet. $100/tx is the "every few years" rate.
Oh, there will be runs.
If they remove the guardrails keeping crypto out of the regulated financial industry (read: KYC and AML requirements), your bank deposits will absolutely be comingled with toxic crypto assets, because it will be way cheaper to avoid paying compliance people than the transaction fees.
Will definitely be entertaining to watch if it happens.
It won't be bozo bucks because like you said it has a real value. Having international, anonymous, instant money laundering machine is invaluable. It will take legislation to criminalize people from taking part in the money laundering machine to kill the value. That isn't happening in the next 3 years.
I am sorry to tell you that the majority of the services that you may be using (Stripe, OpenAI, Anthropic, PayPal, etc) all have exposure or have some form of funding by crypto.
> Who's going to give you anything for your bozo bucks? At this rate, it's not going to take long.
It's already here. Scan your eye-balls for some Worldcoins ($WLD) to prove you are not a LLM bot.
You might want to go look at CDO's... or synthetic CDOs.
In comparison, crypto looks like a rational product relative to that.
The bad idea was making bad loans, putting them in CDOs, and then using flawed models to certify them as risk free. That's irrational.
Dividing up the credit risk on a pool of loans so that some people lose money only if all the loans go bad is a very good idea. You just need to make sure they are good loans.
The irony being it would actually help lower the barrier for entry a little to get a home loan on the consumer end of the spectrum but as you said they dropped that barrier subterranean and then predatory crap like payment-option ARMs and a massive lack of informed consent.
I think like, 90% of the crypto trading volume is by people who know it's all a grift, but are hoping to get rich while the music is still playing.
People knowingly buy into pump & dumps, gambling that they're on the early (pump) side and hoping to get out before the dump.
People will happily collect commissions selling products they know are scams or will happily collect management fees for parking investor's capital into grifts.
You'll never get truly everyone to recognize it, and it only takes one sucker at the poker table to keep every seat filled.
> People knowingly buy into pump & dumps, gambling that they're on the early (pump) side and hoping to get out before the dump
I recently heard of a real estate person that wound up buying an entire neighborhood around one of the stadiums for next year's World Cup. The impetus for this decision was to jack up the rates during the tournament, and then sell them off after. Another person thinks renting a bunch of Teslas and then placing them Touro will be another get rich idea during the World Cup. There are all sorts of people that think they are smarter than everyone else and are so confident they just cannot think of any ways their idea will fail.
What makes you think that the participants are not in on the grift? People are different, some rather supports wholesome stuff, some don't give an f. And it's not just morals that differ, risk-taking is also individually different (and can change with age and other life situation too).
> What happens when everyone recognizes that the whole thing has turned into a money laundering grift?
Part of the problem is that this seems to describe most of the economy now. Maybe not specifically money laundering, but it’s all a grift whether we are talking about Binance, OpenAI, or Skydance-Paramount. There are grifts everywhere which just encourages more grifts as people see the resulting success and lack of consequences.