Crypto Conversation

[OldPhiKap]

Leverage can be your friend. 🙂

Or not. 🥲

“When the tide goes out, we see who has been swimming naked.”

[Jeffrey]

“When the tide goes out, we see who has been swimming naked.”

Frankie Lee and Judas Priest
They were the best of friends
So when Frankie Lee needed money one day
Judas quickly pulled out a roll of tens
Placed them on a footstool
Just above the plotted plain
Sayin', "Take your pick, Frankie Boy
My loss will be your gain"

[OldPhiKap]

Frankie Lee and Judas Priest
They were the best of friends
So when Frankie Lee needed money one day
Judas quickly pulled out a roll of tens
Placed them on a footstool
Just above the plotted plain
Sayin', "Take your pick, Frankie Boy
My loss will be your gain"

All that I am asking for is ten gold dollars
And I could pay you back with one good hand
You can look around about the wide world over
And you'll never find another honest man

Last fair deal in the country
Last fair deal in the town
Put your gold money where your love is, baby
Before you let my deal go down
Go down

[Skydog]

Leverage can be your friend. 🙂

Or not. 🥲

The year 2000 was my first serious foray into stocks. FOMO struck as my friends were getting rich on their Amazon stock. I “did my research” - looked at a logarithmic graph of NASDAQ and it was a ruler straight ascending line for 30 years. The smart funny guys over at Motley Fool were giving me great info on emerging tech companies about to go ballistic. So I felt safe buying on margin; knew I could cover even if some of my stocks dropped an unimaginable 25-40%. First stock I bought was Dell. When it dropped and other fools panicked I bought more. Sure enough it quickly recovered and I was in the black. I had found my model - buy on the dips! Worked for a couple giddy months. Then suddenly everything went to went haywire and my finances made the Red Wedding look like a fun time.

Impeccable timing on my part. 😂

[acdevil]

I had the opposite experience. I worked at an investment bank starting in 99. First bonus had some company stock. After a year, I had a chunk vested. I didn’t want to be doubled up in the risk of my own firm so I sold it.

Now, what should I do with that 15k? I had no idea. I work in bankruptcy so everything looked terrible to me (it’s right before 9/11).

I said screw it and just put it in Apple since the iPod was pretty cool. It was $14 per share at the time. The rest is history.

[snowdenscold]

Pretty interesting read from a couple weeks ago:


Coindesk - Layer 2 - Future of Money - Why This Crypto Crash Is Different

But this time really is different. Driven by war and pandemic, a new macroeconomic paradigm is forming. High inflation is back after a 30-year absence, and with it, much tighter monetary policy. Interest rates are rising, and central banks around the world are burning money. The era of plentiful dollars is coming to an end. And that will mean persistently lower prices for cryptocurrencies.

Crypto markets have never known anything but easy money. Bitcoin was born in the aftermath of the 2008 financial crisis, when many people feared that central banks’ experiment with ultra-low interest rates and quantitative easing (QE) would cause runaway inflation. Ten years later, interest rates were still far below pre-financial crisis levels, and central bank balance sheets were still massively inflated. And the runaway inflation predicted by bitcoiners had failed to appear. Instead, asset prices had risen massively – including cryptocurrency prices, as investors desperate for yield piled into bitcoin and other cryptocurrencies.

The crypto industry’s luxuriant growth since Bitcoin emerged from the ashes of the financial crisis – and particularly since March 2020 – can be directly attributed to the copious monetary fertilizer central banks have been pouring into financial markets.

But now we have inflation. Economists argue about whether this inflation is principally caused by supply disruptions or excessive demand, and whether it will be transitory or long-lasting. No matter. Central banks, under pressure to get inflation under control, are rapidly removing the monetary fertilizer and getting out the pruning shears. The markets with the most luxuriant growth will suffer the sharpest cuts.

The only real dollars in the cryptocurrency industry are those paid by new entrants when they make their first cryptocurrency purchases. The rest of the dollar liquidity on crypto markets is provided by dollar-pegged stablecoins. These fall into two groups: those that have actual dollars and/or dollar-denominated safe liquid assets backing them, and those that don’t. There aren’t enough of the former to enable everyone to cash out into real dollars, and there’s no guarantee that the latter can be cashed out into real dollars at all. So, in effect, the entire crypto industry is fractionally reserved.

There’s now a race on to exchange cryptocurrencies for the few real dollars still available. As is always the case in unregulated markets, the law of the jungle applies. Those with the biggest teeth get the dollars. Perhaps “whales” is the wrong name for them. Crocodiles might be more like it.

When everyone is trying to cash out cryptocurrencies into increasingly scarce dollars, cryptocurrency prices rapidly fall to the level at which there are sufficient dollars in the system for everyone to be able to cash out.

If tighter money is here to stay, as many expect, then continuing dollar scarcity will make it impossible for crypto to rise again as it has before. Rather, it will have to adapt to the new paradigm. It could return to its roots, eschewing the dollar and valuing crypto only in terms of itself: “1 BTC = 1 BTC”, as bitcoin maximalists like to remind us. Alternatively, it could attract more real dollars by developing real-world use cases, rather than relying on network effects to pump up dollar values that are unrealizable in practice. But this is unlikely to generate the high dollar values of the past.

For more discussion on the "stablecoins providing almost all the liquidity", aspect:
https://twitter.com/smdiehl/status/1393669812220465162
(from a year ago)

Stephen Diehl
@smdiehl
Now this is a huge problem because by volume Tether is BY FAR the most traded cryptocurrency in the entire world. Surpassing every other token by a significant margin. (19/)

Also the most traded cryptocurrency FOR bitcoin. 80% of bitcoin volume is where one party is trading Tether for bitcoin. If price of bitcoin is quoted in dollars, and sold in tether, that price isn't reflecting the the vast risk/value differential between the two. (20/)

It's widely suspected that many exchanges are receiving large deliveries of unbacked tethers, using them to wash trade with themselves for bitcoin to drive up demand, and thus the synthetically inflate the price.

This is illegal in other markets.
(21/)

A significant portion of bitcoin price formation is therefore quoted in dollars, but paid for in USDT dollars that are only actually backed by three cents.

Which would make most of the price formation of bitcoin completely synthetic. (23/)

Which leads to the obvious inconvenient truth that most people who look at the crypto space come to understand.

Most exchanges are *vastly* undercapitalized and will never be able to pay out even a tiny fraction of their customers in real dollars.

Which gets back to the whole debate throughout the industry as to what Tether's assets really are, and how can we trust it. According to Tether's side of the story, all is well and good and they have tens of billions readily on hand in cash and can pay out any customer, but there's a lot of skepticism out there around that, especially the commercial paper holdings.

https://www.ft.com/content/59849743-...8-fdc68651d2d4

[Skydog]

I had the opposite experience. I worked at an investment bank starting in 99. First bonus had some company stock. After a year, I had a chunk vested. I didn’t want to be doubled up in the risk of my own firm so I sold it.

Now, what should I do with that 15k? I had no idea. I work in bankruptcy so everything looked terrible to me (it’s right before 9/11).

I said screw it and just put it in Apple since the iPod was pretty cool. It was $14 per share at the time. The rest is history.

Fortunately I worked at an employee owned company from 2000 to last January. Half of my yearly bonus was in company shares and the stock has done very well. Clearly the best way for me to make money is stay the helx away from the decision making!

[Wheat/"/"/"]

Pretty interesting read from a couple weeks ago:


Coindesk - Layer 2 - Future of Money - Why This Crypto Crash Is Different






For more discussion on the "stablecoins providing almost all the liquidity", aspect:
https://twitter.com/smdiehl/status/1393669812220465162
(from a year ago)




Which gets back to the whole debate throughout the industry as to what Tether's assets really are, and how can we trust it. According to Tether's side of the story, all is well and good and they have tens of billions readily on hand in cash and can pay out any customer, but there's a lot of skepticism out there around that, especially the commercial paper holdings.

https://www.ft.com/content/59849743-...8-fdc68651d2d4

There are a lot of mine fields in the current state of “crypto”. An immature market would be putting it kindly.
It’s good to be very cautious. Very cautious.
Lots of stuff that’s going to go to zero out there.

Personally, I’m not touching any stablecoins, or chasing yield on exchanges with my assets, until we see some real stablecoin regulations and apply substantial banking regulations on exchanges from the US government.

Buying and hodling offline for minimum of 5 years, or until things change is my plan.

[snowdenscold]

Having listened to that whole thing: What the actual hell? He starts with double spent and just going off the rails immediately. Bitcoin is digital energy that vibrates, oscillates and can be transferred into politcal energy? Political energy is a fluid? Currency is a fluid? Political energy can become matter and work? High frequency is money but low frequency is capital? Can satoshis create gravity?

Again what the actual hell? Thanks for the chuckles.

From the same school of "I don't really know what this means...":
Crypto exchange Gemini executes second round of layoffs less than two months after axing 10% of staff

Winklevoss also said that the message was a “friendly reminder that Karma is the blockchain of the universe — an immutable ledger that keeps track of positive and negative behavior.”

“We are going to the moon. We are going to need cosmic consciousness to get there. Earthly consciousness will not be enough,” Winklevoss added. “If you are exhibiting the behavior of a first-time human, time to level-up or respectively bow out, if for no other reason but to avoid an expensive bill in the future.”

[Phredd3]

From the same school of "I don't really know what this means...":
Crypto exchange Gemini executes second round of layoffs less than two months after axing 10% of staff

I read that whole weird diatribe as nothing more than Winklevoss threatening leakers with retribution. He wasn't saying anything about the business itself.

[Kdogg]

From the same school of "I don't really know what this means...":
Crypto exchange Gemini executes second round of layoffs less than two months after axing 10% of staff

Originally Posted by :
Winklevoss also said that the message was a “friendly reminder that Karma is the blockchain of the universe — an immutable ledger that keeps track of positive and negative behavior.”

“We are going to the moon. We are going to need cosmic consciousness to get there. Earthly consciousness will not be enough,” Winklevoss added. “If you are exhibiting the behavior of a first-time human, time to level-up or respectively bow out, if for no other reason but to avoid an expensive bill in the future.”

The big mistake here is assuming humans are the top rung of the karma ladder. I want to come back as an American pet.

I read that whole weird diatribe as nothing more than Winklevoss threatening leakers with retribution. He wasn't saying anything about the business itself.

Can’t he just say snitches get stitches?

I will say, from all that I’ve read, the Winklevoss twins have been above board with there Bitcoin dealings. They were relatively early to the game with BTC in the hundreds/low thousands when they amassed 1% of the then market. They weren’t into the libertarian leanings just the economic ones.

[Kdogg]

Looks like Tesla has dumped 75% of its Bitcoin holdings for a net loss of $72 million. It could have been worse but they sold earlier in the quarter when the price was around $29,000.

https://www.businessinsider.com/tesl...on-musk-2022-7

[snowdenscold]

The big mistake here is assuming humans are the top rung of the karma ladder. I want to come back as an American pet.



Can’t he just say snitches get stitches?

I will say, from all that I’ve read, the Winklevoss twins have been above board with there Bitcoin dealings. They were relatively early to the game with BTC in the hundreds/low thousands when they amassed 1% of the then market. They weren’t into the libertarian leanings just the economic ones.

Yeah I don't think they're in the scammy crowd like 90% of this space, just in the "I have no clue what they're saying as they speak" crowd =)

[budwom]

The big mistake here is assuming humans are the top rung of the karma ladder. I want to come back as an American pet.



Can’t he just say snitches get stitches?

I will say, from all that I’ve read, the Winklevoss twins have been above board with there Bitcoin dealings. They were relatively early to the game with BTC in the hundreds/low thousands when they amassed 1% of the then market. They weren’t into the libertarian leanings just the economic ones.

I’ve already signed up to be a Labrador Retriever

[mpj96]

DOJ initiates first ever criminal prosecution for insider trading. Former Coinbase employee among those accused:

https://www.justice.gov/usao-sdny/pr...tipping-scheme

[Wheat/"/"/"]

“Chub Cay – an island nested within the Berry Islands district of the Bahamas – is a private island seeking to adopt a bitcoin standard, and they need a strong Lightning Network wallet service provider to bridge infrastructural gaps….

[OldPhiKap]

Chub Cay had a population of less than 50 people per the 2010 census, and has no banks.

https://en.m.wikipedia.org/wiki/Chub_Cay

But I’ll agree it is a legitimate business use for crypto if it comes together.

[Jeffrey]

DOJ initiates first ever criminal prosecution for insider trading.

Really? Hard to imagine DOJ has never prosecuted anyone for insider trading before this event.

[JimSouthie]

if i had more $ i would grab it all.

tsla also a good shout now too seen its bottom and 1200 looks easy again

[snowdenscold]

Really? Hard to imagine DOJ has never prosecuted anyone for insider trading before this event.

Context was crypto markets:

U.S. Attorney Damian Williams said: “Today’s charges are a further reminder that Web3 is not a law-free zone. Just last month, I announced the first ever insider trading case involving NFTs, and today I announce the first ever insider trading case involving cryptocurrency markets. Our message with these charges is clear: fraud is fraud is fraud, whether it occurs on the blockchain or on Wall Street.