Tell me again about the virtues of cryptocurrency...

[RP]

https://www.aol.com/finance/explaine...200035968.html

[imwjl]

Originally Posted by RP

https://www.aol.com/finance/explaine...200035968.html

That seems maybe a misunderstanding or troll post. The virtues or values of the underlying technologies in cryptocurrency are very different than highly speculative and unregulated business.

If you just mean the highly speculative and unregulated business, there virtues are usually getting in early and a well timed fast exit. That doesn't generally benefit a lot of people like a retirement fund buying shares of a conventional, regulated and profitable business can.

Edit: It might also be good to know the news of unauthorized access to the exchange customer accounts isn't same as breaking cryptography in general.

[buddyhu]

Originally Posted by imwjl

That seems maybe a misunderstanding or troll post. The virtues or values of the underlying technologies in cryptocurrency are very different than highly speculative and unregulated business.

If you just mean the highly speculative and unregulated business, there virtues are usually getting in early and a well timed fast exit. That doesn't generally benefit a lot of people like a retirement fund buying shares of a conventional, regulated and profitable business can.

Edit: It might also be good to know the news of unauthorized access to the exchange customer accounts isn't same as breaking cryptography in general.

Im guessing OP’s post is a follow up to several threads that have appeared in the Open Mic sub-forum over the years, where some individuals have touted the virtues of investing in cryptocurrency.

[JonWint]

The virtue of crypto currency is that had the FTX account owners chosen to hold the coins in a personal wallet instead of letting FTX have custody, they would have not lost any money due to mishandling.

A personal wallet removes any risk of insolvency of a custodial broker/company/bank.

[tinnitus]

It would be fun if the $200 I invested in Shiba last year (with free money I recovered from Bitcoin when I cashed that out) magically goes up to $1 per share. That would make me a tidy $7.3 Million. Even 10 cents/share would be fine, lol.

[ewalling]

Hang on, how does crypto work, again?

Don't answer that ... please!

[Murphy Slaw]

This house of cards has just begun to crumble.

They were literally printing money out of thin air.

And then, spreading it around. Kinda brilliant, actually.

It is fun to watch.

[imwjl]

Originally Posted by Murphy Slaw

This house of cards has just begun to crumble.

They were literally printing money out of thin air.

And then, spreading it around. Kinda brilliant, actually.

It is fun to watch.

The conventional banking system creates money out of thin air too so it is possible I don't understand what you mean here. That difference I pointed out where the FTX exchange's issues and cryptocurrency are very different?

Well before we had an Internet age, a lot of policies of past decades or cryptocurrency, there were those formulas on money that still apply showing how lending creates money. Lending and speculation go back before any current central banks or currencies, the lending process still had the same net effect.

[JonWint]

Another virtue of crypto is for international monetary transfers. It reduces the transfer time from 2 days to 10 seconds.

"The Office of the Comptroller of the Currency (OCC) bureau of the U.S. Department of the Treasury said that banks and federal savings associations can use stable-coins and independent node verification networks (INVNs), otherwise known as blockchain networks, to perform payment activities and perform permissible bank functions."

[leew3]

Originally Posted by Murphy Slaw

This house of cards has just begun to crumble.

They were literally printing money out of thin air.

And then, spreading it around. Kinda brilliant, actually.

It is fun to watch.

to be clear, they were figuratively printing money out of thin air, yet your point is valid!

[imwjl]

Originally Posted by leew3

to be clear, they were figuratively printing money out of thin air, yet your point is valid!

I'm not understanding that any more than the post you quoted. The exchange that is in trouble is not cryptocurrency. Some time might show it to have more in common with a mess like Enron. Another case of people at once hating and wanting regulation.

Making money out of thin air would go back many thousands of years. Something like when Homo sapiens figured out symbols, imagination formalizing trust or agreements and the phenomenon of what lending does.

@JonWint pointed out a tremendous virtue. If not, a whole lot of reason to aim criticism at conventional banking and seek improvements.

[buddyhu]

Originally Posted by JonWint

Another virtue of crypto is for international monetary transfers. It reduces the transfer time from 2 days to 10 seconds.

"The Office of the Comptroller of the Currency (OCC) bureau of the U.S. Department of the Treasury said that banks and federal savings associations can use stable-coins and independent node verification networks (INVNs), otherwise known as blockchain networks, to perform payment activities and perform permissible bank functions."

But with the value of crypto being so unstable, it’s uses for international transfers and for commerce is quite limited.

And while banks have their drawbacks, because they are regulated and thier activities make use of currencies backed by governments (some of which are very stable), they would appear to be much more trustworthy.

[JonWint]

Originally Posted by buddyhu

But with the value of crypto being so unstable, it’s uses for international transfers and for commerce is quite limited.

That's why only stablecoins are authorized by the Feds. They are as stable as the currency to which they are linked.

[buddyhu]

Originally Posted by JonWint

That's why only stablecoins are authorized by the Feds. They are as stable as the currency to which they are linked.

Not necessarily. Only if they are fully transparent about exactly how much they hold in reserves of the currency or commodity that they are pegged to, and those reserves are sufficient. And there have been some problems with some stablecoins in this regard.


And, “Unlike banks and MMFs, however, most stablecoin issuers are not subject to federal regulations and protections designed to instill faith in those liabilities, such as deposit insurance and portfolio restrictions.”

Last: I am not sure what you mean when you say they are authorized by the feds. What federal agency, and authorized for what purpose or use?

And…at some point, cryptos like stablecoins start to look like a reinvention of the wheel: if they are regulated enough and are transparent enough to be stable and trustworthy at a level that approaches a government-backed currency that is exchanged and loaned by banks, what exactly is their benefits? I think many people are interested in crypto because they hope they can “get rich quick”, or because they are involved in activities where the use of normal banking would bring unwanted “attention”. Do stablecoins offer benefits to folks that don’t fall into such categories?

[JonWint]

Originally Posted by buddyhu

Last: I am not sure what you mean when you say they are authorized by the feds. What federal agency, and authorized for what purpose or use?

Answer contained in Post #9

Originally Posted by JonWint

"The Office of the Comptroller of the Currency (OCC) bureau of the U.S. Department of the Treasury said that banks and federal savings associations can use stablecoins and independent node verification networks (INVNs), otherwise known as blockchain networks, to perform payment activities and perform permissible bank functions."