[unemphysbro]

why? i think it's the coolest thing ever.

anyone can write a contract to automate taking out a loan, investing it, and pulling out the money, develop exotic securities, and bespoke arbitration. anyone can do it regardless of credentials or connections; just a month of learning.

pretty darn cool to have unbridled access to a distributed computer.

[arcticbull]

The answer is pretty straight-forward. Every time we tried this before it collapsed into a giant ball of flame.

Nothing crypto is producing is new.

We've had stablecoins before in the form of wildcat banks. [1] They were backed at some point by barrels of nails with a few flakes of gold on top, and what little gold there was, was spirited around from bank to bank in front of the inspectors. That ended predictably.

We've had "ICOs" in the form of blue sky securities. [2] Companies that did nothing sold on the premise that you could simply sell the shares to someone else for more money. That ended predictably.

We've had "high yield investment platforms" in the form of actual honest-to-goodness Ponzi schemes before. That ended predictably.

We've had free reign access to leverage to buy more securities before - it led to the Great Depression. We had rhypothecation of securities and totally baseless collateral generation before - it led to the Great Recession.

Crypto hasn't created anything new fundamentally, it's just re-hashing all the stuff we outlawed before because it was an objective breeding ground of fraud and crime and grift. The only thing new about the crypto economy is that the pitches are structured as "${previously_failed_idea} except on the Internet."

[1] https://en.wikipedia.org/wiki/Wildcat_banking

[2] https://en.wikipedia.org/wiki/Blue_sky_law

[momojo]

> Crypto hasn't created anything new fundamentally

Orchids and Baseball cards and Beanie-Babies. We don't need a decentralized immutable, distributed ledger to verify something's value. We're already good at prescribing disproportionate value to arbitrary things. I don't think we ever cared that it was centralized or not.

[mattwilsonn888]

Why is it that everything a crypto die-hard says is held to the flame but when you are a skeptic you are allowed to be ignorant and obtuse? The space needs hard looks for every claim said, not just the positives.

Most people in crypto are aware of why Tether is bad. In fact a huge portion of stable-coins are handled algorithmically and backed by their network asset. You are building strawmen, likely out of ignorance.

[yrral]

> The answer is pretty straight-forward. Every time we tried this before it collapsed into a giant ball of flame.

This is availability heuristic. Many financial innovations work out well and power everything we do today without a second thought. Credit cards, internet banking, mobile banking, etc etc etc. Should we ban all financial innovations because a subset can cause collapse?

For stablecoins, the difference here is that all data is open. So for example with the latest news with MIM/abracadabra, all the loans/treasuries and collateralization ratios are viewable by everyone [1] and on chain as well. For Dai/frax/etc as well.

[1] https://dashboard.abracadabra.money/

For ICOs, this exists today as well in our regular regulated markets as well. Don't tell me you think AMC or GME is worth what they are worth.

> Crypto hasn't created anything new fundamentally, it's just re-hashing all the stuff we outlawed before because it was an objective breeding ground of fraud and crime and grift. The only thing new about the crypto economy is that the pitches are structured as "${previously_failed_idea} except on the Internet."

I'm not sure this is true.

[kyle-rb]

Who is offering automated loans? "Regardless of credentials or connections" sounds like I don't need any credit history or anything, how do they trust me with this free money?

And I already have unbridled access to my own computer, which seems to have more compute power than the EVM.

[exdsq]

Essentially, at the moment, over-collateralized loans. Deposit $100 and borrow $90, if you pay back $95 by tomorrow you get your original $100 back. There's actually some really cool and complex financial instruments you can build by combining these and the nature of atomic transactions on the blockchain (you can take a loan and pay it back in the same transaction while using the money in other txs to get a profit, it's really weird HFT).

[unemphysbro]

https://docs.aave.com/developers/v/2.0/guides/flash-loans

have fun :) play around on the testnets first.

[JaimeThompson]

Except humans haven't developed ways to write bug free code except in a very few limited circumstances none of which crypto uses.

[unemphysbro]

hence the recent renaissance in formal methods

eg.

https://www.certik.com/

[riskneutral]

> i think it's the coolest thing ever ... anyone can write a contract to automate taking out a loan, investing it, and pulling out the money, develop exotic securities, and bespoke arbitration. anyone can do it regardless of credentials or connections; just a month of learning.

That's all fine, until the SEC come knocking. The only advantage in the crypto space is that you try to skirt financial regulations. Establishing a new broker-dealer, bank, etc, requires a substantial capital investment to meet the minimum regulatory requirements. That gives some crypto companies an advantage (for now), since they can skip all that, but you can see sure that established interests are not taking this lying down and new regulations are in the pipeline. Once the global regulation of cryptocurrency is completed, either crypto will be dead or it will have to play the same rules as the rest of the financial industry.