Author Topic: The Crypto Token Economy Is Second-Order Fraud  (Read 272 times)

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Offline Kamaji

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The Crypto Token Economy Is Second-Order Fraud
« on: January 25, 2023, 02:36:21 pm »
The Crypto Token Economy Is Second-Order Fraud

The entire industry is artifice built atop artifice.

Sohale Mortazavi
24 Jan 2023

The cryptocurrency meltdown is regularly described as a liquidity crisis by industry insiders and uncritical media outlets. The story goes something like this: a downturn in crypto markets, perhaps the result of negative trends in the broader economy, triggered a liquidity crisis that led to cascading bankruptcies across the industry.

By this telling, the trouble began back in May when the Terra (UST) stablecoin began to de-peg from the dollar as its sister cryptocurrency, Luna, crashed in value. The price of both cryptocurrencies fell to practically nothing within a few days, wiping out $US45 billion in market value. The immediate fallout resulted in a loss of value of $US300 billion across cryptocurrency markets within the week. (That figure has since grown to over $US2 trillion as prices have continued to slump.) Highly leveraged cryptocurrency investment firms suffered staggering losses. In June, Three Arrows Capital, a major crypto hedge fund that had borrowed heavily to leverage their own crypto investments, could not meet margin calls and was quickly forced into liquidation.

With so many loans going into default, crypto lenders started to go under as well. At the time of liquidation, Three Arrows Capital owed lenders $US3.5 billion, with little ability to repay. Voyager Digital, a major crypto lender, was left on the hook for $US370 million in Bitcoin and another $US350 million in USDC stablecoins that they had loaned Three Arrows. Celsius Network, another major crypto lender, had loaned Three Arrows $US75 million in USDC—and that was just the beginning of their troubles. Suffering its own heavy investment losses, Celsius acknowledged a $US1.2 billion hole in its balance sheet. In truth, the hole was far larger, as their assets included billions in obscure cryptocurrencies issued by Celsius itself and similar firms, as well as almost a billion in loans to such entities. Though cryptocurrency is generally thought of as liquid—Bitcoin has been called “digital cash”—these more obscure digital assets proved illiquid and, ultimately, of little real value as the firms issuing them began to fail.

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Source:  https://quillette.com/2023/01/24/the-crypto-token-industry-is-second-order-fraud/

Offline Drago

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Re: The Crypto Token Economy Is Second-Order Fraud
« Reply #1 on: January 26, 2023, 02:37:00 pm »
They aren't called "*hitcoins" for nothing!!   :poo:   Stick with BTC. The more crypto speculators/day traders/shysters "washed out" of the ecosystem the better!!

Offline Free Vulcan

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Re: The Crypto Token Economy Is Second-Order Fraud
« Reply #2 on: January 26, 2023, 04:20:17 pm »
I looked into buying some crypto a little over a year ago. After doing the research, I just said 'negatory'. If it wasn't completely shady, it was a pipe dream, especially the token crap. Even Bitcoin, because it took so much electricity to mine, I knew at some point the govt was going to put their foot down.

That doesn't even cover the exchanges, most of which were sketchy, took way to much in commissions, had too many hoops, and in some cases would never let you cash out.

Let it burn.

The Republic is lost.