Crypto might be useful in some unique, tumultuous circumstances, such as living in a sanctioned or failed state where the official economy barely functions. (Even in such places, you'd be surprised to see that the cell phone network still works, and cheap Chinese Android phones are a dime a dozen.) But that's not enough to overhaul the whole financial system.
From Bari's questions as moderator, I think she shares my crypto-agnosticism if not outright skepticism.
Being a cryptoskeptic to being with, after listening to this podcast I'm still with Mike. The questions Bari brought to the table were excellent but with one or two key questions of mine missing.
Pomp said crypto will get rid of the elites. Crypto is like every other new investment vehicle; the slobs (you and me) get in on the ground floor but after some evolution weeds a number out, they become the elites that count on you participating but NOT being successful. So, its nothing new in those regards.
Question 1: What about safety of my savings? If I deposit my meager savings in a bank and it goes under or gets robbed, then I know my government will protect me and my money is not lost. A run on the bank still protects me.
However, with crypto, if it gets stolen, the cryptovault goes bankrupt or out of business, or there is a run on the wallet company, then I lose everything. We can see this happens all the time! Maybe in the future it won't and maybe there will be insurance, but right now, its a wild west out there with NO US Marshalls hunting down bank robbers.. well, successfully. When hostile government backed entities (North Korea's hackers and Russia's Internet Research Agency) are out there to get your money with no recourse, why would I want to risk it?
Question 2: Like any investment vehicle it can be manipulated? What protects us from that? Nothing. The very fact that it exists outside government control or central supervision makes it ripe for evil actors. Let us say there was a farm where everyone can plant, grow, and harvest. Evil Bob decides to wait for you to plant and grow. But, without contributing anything he comes in a day before you plan to harvest with his buddies and their trucks, and they take everything.
Ridiculous? What about the stock manipulation of GameStop? You want that for your currency?
Furthermore, the fact that its not based on a country's debt, performance, monetary policy (etc.) and has NO governance , leaves it completely open to random market forces and the whims of bad actors.
As much as you want to tout the ability for evil governments to be unable to track or control transactions, Pomp completely ignored that this also makes it ripe for evil governments and terrorist organizations to exploit it. One of our biggest IT threats, ransomware, is paid in Bitcoin. I propose that ransomware has become an even bigger threat BECAUSE of Bitcoin.
The final thing I want to add was kudos to Mike's last couple of points. Pomp and other supporters of the crypto world appear to either live in an extreme fantasy world or have ulterior motives for you to get in and try to buy thus driving the price up.
The ONLY actual benefit I see is that its a way for countries like the Ukraine to receive funding; in an unfortunate situation. However, I propose that without Bitcoin, the world would find another way.
Lack of security of my money, high volatility, no oversight, easy manipulation, ideal vehicle for criminal funding... you want THAT for your currency? No way.
While crypto is ultimately going to be a hollow failure, there is merit in the blockchain technology that enabled it. But even that has issues. I used to think that a non-managed system of financial settlement was an incredibly powerful thing.
But the fact that it relies on ever-increasing electrical usage (via mining) means that it is hard to imagine bitcoin lasting another 10 years let alone 100. Creative concept, but fatally flawed.
Much more hype than reality. Plus it's a world destroying disaster for the environment since it wastes so much electricity. And it's extraordinarily volatile. If I wanted to gamble, which I do not, I'd move to to a tacky wasteland like Las Vegas long before I'd invest a penny in bitcoin.
And NFTs are beyond belief, the height of absurdity. The Bored Ape Yacht Club (Bored Ape Yacht Club???) which has lost hundreds of thousands of dollars in the past couple of months proves there's a sucker born every minute.
We live in an insane time where the president of the United States, whom I made the mistake of voting for, thinks that men can be women. And people are afraid to state what was obvious over two years ago, that covid escaped from a sloppy lab in Wuhan. So it's not surprising that the whole world has jumped the shark.
I at least understand the point of crypto. I don't understand the point of NFTs at all, aside from people just not knowing what to do with their money.
It was bizarre to hear Pompliano talk about Bitcoin's "monetary policy". Bitcoin has no bond market, where it's lent at an interest rate, usually with collateral. And it can't in any meaningful way, because loans imply contracts between two parties, and a legal system to enforce those contracts.
"Smart contracts" can do this with some non-tangible goods, but almost all wealth exists in the real world, and courts decide ownership rights of real property, corporate assets, and profits. No government will ever hand over somebody's home to another person because a smart contract says they didn't pay their bitcoin loan.
Crypto might be useful in some unique, tumultuous circumstances, such as living in a sanctioned or failed state where the official economy barely functions. (Even in such places, you'd be surprised to see that the cell phone network still works, and cheap Chinese Android phones are a dime a dozen.) But that's not enough to overhaul the whole financial system.
From Bari's questions as moderator, I think she shares my crypto-agnosticism if not outright skepticism.
Being a cryptoskeptic to being with, after listening to this podcast I'm still with Mike. The questions Bari brought to the table were excellent but with one or two key questions of mine missing.
Pomp said crypto will get rid of the elites. Crypto is like every other new investment vehicle; the slobs (you and me) get in on the ground floor but after some evolution weeds a number out, they become the elites that count on you participating but NOT being successful. So, its nothing new in those regards.
Question 1: What about safety of my savings? If I deposit my meager savings in a bank and it goes under or gets robbed, then I know my government will protect me and my money is not lost. A run on the bank still protects me.
However, with crypto, if it gets stolen, the cryptovault goes bankrupt or out of business, or there is a run on the wallet company, then I lose everything. We can see this happens all the time! Maybe in the future it won't and maybe there will be insurance, but right now, its a wild west out there with NO US Marshalls hunting down bank robbers.. well, successfully. When hostile government backed entities (North Korea's hackers and Russia's Internet Research Agency) are out there to get your money with no recourse, why would I want to risk it?
Question 2: Like any investment vehicle it can be manipulated? What protects us from that? Nothing. The very fact that it exists outside government control or central supervision makes it ripe for evil actors. Let us say there was a farm where everyone can plant, grow, and harvest. Evil Bob decides to wait for you to plant and grow. But, without contributing anything he comes in a day before you plan to harvest with his buddies and their trucks, and they take everything.
Ridiculous? What about the stock manipulation of GameStop? You want that for your currency?
Furthermore, the fact that its not based on a country's debt, performance, monetary policy (etc.) and has NO governance , leaves it completely open to random market forces and the whims of bad actors.
As much as you want to tout the ability for evil governments to be unable to track or control transactions, Pomp completely ignored that this also makes it ripe for evil governments and terrorist organizations to exploit it. One of our biggest IT threats, ransomware, is paid in Bitcoin. I propose that ransomware has become an even bigger threat BECAUSE of Bitcoin.
The final thing I want to add was kudos to Mike's last couple of points. Pomp and other supporters of the crypto world appear to either live in an extreme fantasy world or have ulterior motives for you to get in and try to buy thus driving the price up.
The ONLY actual benefit I see is that its a way for countries like the Ukraine to receive funding; in an unfortunate situation. However, I propose that without Bitcoin, the world would find another way.
Lack of security of my money, high volatility, no oversight, easy manipulation, ideal vehicle for criminal funding... you want THAT for your currency? No way.
While crypto is ultimately going to be a hollow failure, there is merit in the blockchain technology that enabled it. But even that has issues. I used to think that a non-managed system of financial settlement was an incredibly powerful thing.
But the fact that it relies on ever-increasing electrical usage (via mining) means that it is hard to imagine bitcoin lasting another 10 years let alone 100. Creative concept, but fatally flawed.
Crypto is not BTC. It's hard to tell, though, how long will BTC dominate.
Various other cryptocurrencies are orders of magnitude energy efficient. Not all crypto is created by mining, i.e., proof of work.
Here's one list:
https://www.leafscore.com/blog/the-9-most-sustainable-cryptocurrencies-for-2021/
Much more hype than reality. Plus it's a world destroying disaster for the environment since it wastes so much electricity. And it's extraordinarily volatile. If I wanted to gamble, which I do not, I'd move to to a tacky wasteland like Las Vegas long before I'd invest a penny in bitcoin.
And NFTs are beyond belief, the height of absurdity. The Bored Ape Yacht Club (Bored Ape Yacht Club???) which has lost hundreds of thousands of dollars in the past couple of months proves there's a sucker born every minute.
We live in an insane time where the president of the United States, whom I made the mistake of voting for, thinks that men can be women. And people are afraid to state what was obvious over two years ago, that covid escaped from a sloppy lab in Wuhan. So it's not surprising that the whole world has jumped the shark.
I at least understand the point of crypto. I don't understand the point of NFTs at all, aside from people just not knowing what to do with their money.
It was bizarre to hear Pompliano talk about Bitcoin's "monetary policy". Bitcoin has no bond market, where it's lent at an interest rate, usually with collateral. And it can't in any meaningful way, because loans imply contracts between two parties, and a legal system to enforce those contracts.
"Smart contracts" can do this with some non-tangible goods, but almost all wealth exists in the real world, and courts decide ownership rights of real property, corporate assets, and profits. No government will ever hand over somebody's home to another person because a smart contract says they didn't pay their bitcoin loan.