[deleted]
They are a ponzi scheme
[deleted]
Submitted 17 hours ago by Grumpy404@lemmy.zip to [deleted]
Comments
TribblesBestFriend@startrek.website 17 hours ago
SolidShake@lemmy.world 17 hours ago
I think they’re a scam. And like a rich man’s gambling game.
hydrashok@sh.itjust.works 17 hours ago
Crypto is just a modern-day pyramid scheme.
Some may get rich and serve as examples of why others should join, some may break even, but the vast majority of those participating will lose.
In the end, the only winning move is not to play.
zo0@programming.dev 17 hours ago
Looking into as investment? No Looking into as replacement of ‘money’? Yes The real issue with cryptocurrency is as the same as money. If you and another person both believe some arbitrary object has value then you can trade it for goods and services. pros: no centralized bank cons: no centralized bank
TheLeadenSea@sh.itjust.works 17 hours ago
We do need a decentralised currency that isn’t controlled by Visa/MasterCard payment processors, and their puritan ideologies. I haven’t seen many that are so good, but maybe Monero? The main problems seem to be accessibility to the everyday person, ease of conversion between regular money and it (eg USD, GBP, EUR), and lack of it being accepted for normal payments.
ThePowerOfGeek@lemmy.world 17 hours ago
Like others here have said, they are a combination of get rich quick schemes and money laundering. They take the legalized gambling that is the stock markets to a whole new level. I also agree that the underlying concept of them is okay, but they’ve been exploited and hyped up to crazy levels.
If you want to play with crypto ‘investments’ and you have a bit of discretionary spending, you could try it. But just know it’s super-risky and built on a lot of bullshit. Personally I wouldn’t. I’ll stick to passively-managed index funds. They aren’t air-tight safe either, of course. But at least they are less prone to scams and risk.
theunknownmuncher@lemmy.world 17 hours ago
They genuinely don’t make sense as “currency”. Having a public, permanent ledger of all transactions is pretty bad. Buy groceries, pay your rent, and get paid in crypto? Now your landlord, employer, and grocer can see every transaction you’ve ever made, how much your account is worth, and how much you spend. Wonderful!
Sure, you could use a service to obfuscate your transactions, except oopsies, you’ve just reinvented centralization but worse! Wasn’t the whole purpose decentralization??
Cryptocurrency sucks because it genuinely doesn’t make sense at a fundamental level. That’s not even getting into the economic problems, like deflationary currency, or technical problems, like the exponential cost of hosting a node or the fact that it can only be scaled up to handle at most a teeny tiny fraction of a percent of transactions that a service like Visa handles every day.
What is actually a good currency? Cash.
dhork@lemmy.world 17 hours ago
Bitcoin was extremely successful at making what it set out to do in the first place: make a fully distributed, peer-to-peer, trustless currency. Anyone who has ever been forced to pay bogus transaction fees ought to be able to appreciate paying for things without needing a bank, or any intermediary at all. It’s like cash you can e-mail.
But, most people into crypto now don’t care about this utility, they just want Number Go Up. So they don’t transact with it anymore, they just hold it (or actively trade with it). Which makes the whole ecosystem not useful for anything except feeding itself.
I still think that, in theory, there are areas where cryptocutrency can be used for real innovative purposes. But these will never actually be done, because the people on a position to do those things would rather make quick money selling shit tokens to unsuspecting people.
Do you want to learn how it all works? Feel free to do so, it’s all Open Source. But if your goal is to invest… Well… Read up on it and understand it first. This will help you differentiate the good ideas from the scams. (And there are a lot of scams!)
theunknownmuncher@lemmy.world 16 hours ago
Cryptocurrency has transaction fees. They start out as the newly mined coins, paid from the pool of unmined coins. Once the finite number of coins have been mined and that pool is empty, the miners will begin charge fees for each transaction directly to the users making the transactions.
dhork@lemmy.world 16 hours ago
No, that’s not quite how it works.
Calling the newly minted coins a transaction fee “paid from the pool of unmined coins” isn’t really accurate, as those coins didn’t exist until they were mined. The algorithm carefully controls how many new coins are made.
But miners do not set fees at all. Users set their fee when they make their transactions, and miners pick which transactions they want to attempt to validate. We expect miners will pick the transactions with the highest fee per byte, because they want to increase their reward if they manage to find a block. But they don’t have to, and they may have reasons to pick other transactions.
The whole point of it being trustless is that no party needs to coordinate. Users create transactions, miners validate them.
litchralee@sh.itjust.works 17 hours ago
For the blockchain technology at the very core foundation of cryptocurrencies, it’s a reasonable concept that solves a specific challenge (ie no one can change this value unless they have the cryptographic key) and the notion of an indelible or tamper-evident ledger is useful in other fields (eg certificate revocation lists). Using a blockchain as a component is – like all of engineering – about picking the right tool for the job, so I wouldn’t say that having/not having a block chain imparts any sort of opinionation or qualities of good/bad.
One step above the base technology is the actual application as currency, meaning a representation of economic value, either to store that value (eg gold) or for active trade (eg the €2 Euro coin). All systems of currency require: 1) recognition and general consensus as to their value, and 2) fungibility (ie this $1 note is no different than your $1 note), and 3) the ability to functionally transfer the currency.
Against that criteria, cryptocurrencies have questionable value, as seen by how volatile the cryptocurrency-to-fiat currency markets are. Observe that the USD or Euro or RMB are used for people’s salaries, denominate their home mortgage loans, for buying and selling crude oil, and so on. Yet basically no one uses cryptocurrency for those tasks, no one writes or accepts business-to-business contracts denominated in cryptocurrency, and only a small handful of sovereign states accept cryptocurrency as valid payment. That’s… not a great outlook for circulating the currency.
But for fungibility, cryptocurrency clearly meets that test, and probably exceeds the fiat currencies: there’s no such thing as a “torn” Bitcoin note. There are no forgeries of Etherium. It is demonstrable that a unit of cryptocurrency that came from blood-diamond profits is indistinguishable from a unit that was afforded by wages at a fuel station in Kentucky. There are no “marked notes” or “ink packs” when committing cryptocurrency theft, and it’s relatively easy to launder cryptocurrency through thousands of shell accounts/addresses. To launder physical money a thousand times is physically impossible, and is way too suspicious for digitalized fiat current transfers.
And that brings us to the ability to actually transfer cryptocurrency. While it’s true that it should only be an extra ledger entry to move funds from one address/account to another, each system has costs buried somewhere. Bitcoin users have to pay the transaction costs, or currencies pegged to other currencies have to “execute” a “smart contract”, with attendant verification costs such as proof-of-work or proof-of-stake. These costs simply don’t exist when I hand a $20 note to a fuel station clerk. Or when my employer sends my wages via ACH electronic payment.
Observe how cryptocurrency is traded not at shops with goods (eg Walmart) or shops for currency (eg bureau de change at the airport) but mostly only through specialized ATMs or through online exchange websites. The few people who genuinely do use their cryptocurrency wallets to engage transactions are now well in the minority, overshadowed by scammers, confidence/romance tricksters, investment funds with no idea of what they’re doing except to try riding the bandwagon, and individuals who have never traded financial instruments but were convinced by “their buddy’s friend” who said cryptocurrency was a money-making machine.
To that end, I would say that cryptocurrencies have brought out the worst of financial manipulators, and their allure is creating serious financial perils for everyday people, whether directly as a not-casino casino or to pay a ransomware extortion, or indirectly through the destabilization of the financial system. No one is immune to a breakdown of the financial system, as we all saw in 2008.
I used to like discussing eith people about the technical merits of ledger-based systems, but with the awful repercussions of what they’ve enabled, it’s a struggle to have a coherent conversation without someone suggesting a cryptocurrency use-case. And so I kinda have to throw the whole baby out with the bathwater. Maybe when things quiet down in a few decades, the technology can be revisited from a sober perspective.
devolution@lemmy.world 17 hours ago
Scam. Ever since it’s inception.
magic_lobster_party@fedia.io 16 hours ago
I think he idea is compelling. I don’t like to be dependent on banks for digital transactions. Being locked out from making basic transactions because the bank detected ”suspicious behavior” is just awful.
Unfortunately I hate the players of cryptocurrency even more. It’s a huge snake oil pump and dump Ponzi scheme to my eyes.
wildncrazyguy138@fedia.io 16 hours ago
I agree. I was an early adopter. It’s a compelling idea to have a public ledger, but so far it’s been terrible execution, and what a disaster for the environment.
markz@suppo.fi 17 hours ago
I will not even get into crypto as an investment.
Cryptocurrencies as a currency is a bad idea. There are no institutions to protect you. No bank that can refund scammed money. The lack of regulation is a promise for the rich to have total freedom to screw the economy.
missingno@fedia.io 17 hours ago
They're kind of just really damn bad at being currencies. Transaction times and fees make them too difficult to use for anything short of money laundering. But actually decently suited to that one purpose since other forms of laundering are usually even more expensive.
Even worse though is the deflationary nature also disincentivizes ever using them as currency. They're instead being treated as speculative assets, people buy crypto not because they actually want to use crypto, but because they expect to sell it to another bagholder later. But of course the only way to profit off crypto in this way is for someone else to lose. And yet people still try to pretend it's a currency even when no one will ever use it as such, because it sounds more legitimate that way.
And this in turn has made crypto an incredibly attractive target for scams and grifts. Pump-and-dumps are everywhere, but even when people know this they still try to get in hoping they'll be the one to win this time.
Crypto really is just a solution in search of a problem, and every now and then you'll see cryptobros insisting they have the next big thing in NFTs, smart contracts, whatever bullshit they're pushing next. But none of it has ever been anything more than a vehicle to try and find a new way to rip someone else off. They just need to convince you they have something to sell here so that you'll be the next sucker.
Bitcoin has been around since 2008, and in all that time, it's still not amounted to anything more than one big grift.
Aeao@lemmy.world 17 hours ago
I’ve said the same thing since the beginning
“I don’t think it’s viable as a new currency but I see many useful applications for it. Like keys or other yet to be determined inventions “
The power consumption eventually outweighs the benefits as a currency but a small scale one that’s just “credentials to access this locked room” is feasible.
But by the time we get there who knows what ai and quantum computing will have to crack it.
I do see possible applications for the block chain. Currency isn’t one of them.
msokiovt@lemmy.today 17 hours ago
It depends on what crypto it is.
However, if you want to get into it, you need to look into Bitcoin and study it. It has a fixed supply of 21 million (2.1 quadrillion Satoshis to put it in perspective, where 1 BTC = 100 million Satoshis). It’s a hard asset that’s essentially been around since 2008.
There are others such as Monero, which are good as your spending currencies, but some people tend to use Bitcoin Cash (BCH) as spending money too.
Those who say cryptocurrency is a scam don’t really understand how Bitcoin is supposed to work. Apparently, people have said that BTC was a testnet for Monero, considering BTC’s pseudonymous nature.
Witchfire@lemmy.world 17 hours ago
Good idea in concept, but in reality it’s only used for money laundering and grift