I understand that crypto is a scam that will rob millions of people of money they desperately need.
But what you said there is literally the end of my understanding of what crypto is. It has something to do with computers solving math problems, and somehow that’s worth money.
What?
the problem with crypto is that when you try to explain it, it sounds so stupid that someone else thinks you have to be explaining it wrong
but if you want explanation, this one is fine https://ic.unicamp.br/~stolfi/bitcoin/2020-12-31-bitcoin-ponzi.html and this https://www.ic.unicamp.br/~stolfi/bitcoin/2021-01-16-yes-ponzi.html
When I think of crypto I think of that bloke grubbing through landfill for a lost hard drive. I think of Sam Bankman Fried. I think of Trump’s meme coin. Yes, I’m sure someone must be explaining it wrong to this old lady.
So the same as most currency that isn’t backed by actual valuables? Like the US dollar after it stopped being backed by gold like 100 years ago?
Crypto is a world currency that people have assigned value to. Pretty much all other money is a currency that individual countries have assigned a value to. Both types can be just as worthless. Hyper inflation has made money from many countries worth less than a roll of toilet paper to wipe your ass with. For that matter, the US dollar could buy you 30 rolls of toilet paper 75 years ago. Now it can only buy you like 1 roll.
It’s a speculative asset that fluctuates based on the whims of billionaire hedge funds and early crypto investors. There is zero value in owning it unless you got in early enough. And even then it’s a situation of the last man holding the bag. Someone will end up losing their asses.
Most crypto is. Proof of work crypto is not and brings actual stability and longevity to the table. Most people don’t understand this. Proof of stake is never anything more than gambling.
On average the value of any crypto token is less than 0 because of the high cost to produce and transfer them. Ironically it seems people find the most wasteful tokens more valuable. “It’s hard to make so it must be valuable” or some such nonsense.
No, that’s basically it.
The reason for all this work is basically the concept of a currency that isn’t backed by and dependent upon governments while also being impossible to counterfeit, hence a lot of encryption because it fundamentally says that you can’t trust the other computers that you’re talking to. Everybody holds a ledger that says that you have $5, so you can’t suddenly say that you actually have $10. And all the math is to prevent inflation by limiting the amount of currency that exists at any time. The more currency there is from solving the math, the harder the math gets to slow down the creation of new money.
It all falls apart, though, because the only value that crypto has is what it’s worth in traditional fiat currency - the very thing that it’s supposed to replace.
So it’s just a bunch of computers doing a lot of math to make funny money that’s supposedly worth something because…of reasons?
prevent inflation by limiting the amount of currency that exists
which is a flawed premise itself. the supply of currency needs to expand at the same rate as productivity increases or else you get deflation which has its own set of problems
it’s also at the same time libertarian political project that aims to, how they put it, “separate money from state”, which is in itself absurd, but not for libertarians, because their only problem with capitalism is that they’re not on the top. crypto is an attempt to “fix” that “problem”. see also doings of peter thiel, curtis yarvin, urbit,
first they build a place with no state interference and then they learn hard way why there’s so many financial regulations. sometimes it’s deliberate and it’s a way to use novelty to repackage old financial crimes to deflect responsibility long enough to fuck off to Dubai. sometimes it’s scams all the way and scammer already lives in North Korea
You’re close. 1 unless the coin is proof of work you can’t trust it. 2 the value it brings it in the replacement of third party trust for economic transactions and the infrastructure and labor required for that, along with global, instant access to transfer infinite amounts of value as well as store that value logically within your own mind.
Downvotes are coming but if you’re seriously intellectually curious where the value is, read the Bitcoin standard.
You know what a normal database is.
The Blockchain is a distributed database instead of a centralized one where normally people can verify that each other part of the database is correct.
Generally anything a distributed database can do, a centralized database in good hands can do better. Except for crimes. It’s more difficult to get away with crimes when they can be shut down in one place.
Also it’s harder to undo Blockchain/crypto stuff. They sell this as a benefit while the primary use is scams and rug pulls.
“The government can’t get your money back.” Yeah, gonna be hard to get back thr money you were scammed out of with a court order, isn’t it.
They also try to sell it as anonymous, but it’s very much not. Everything is on the record, so if they link you to an address (and they generally can), they can see every transaction you’ve ever made. There used to be services to obfuscate this, but the government has well and truly broken through those. They can find you of they want to.
Crypto is a an MLM for guys. You can make money, if you’re lucky enough to be the scammer and not the scammee.
“it’s somehow worth money” is basically true of all fiat currencies. It’s worth what the consensus agrees it is worth.
(this comment should not be read as a defense of crypto)
Government currencies are backed by taxes - someone did something and gave a portion of the value of their labor to the government, represented by currency. The government then reinvests the labor into the country supposedly for the public good. This is expected to continue indefinitely and it is this cycle that gives the currency value.
Crypto companies have investors. Investors are only attracted by the prospect of growth. They have no natural revenue cycle, no way of creating value without hype and people gambling with their.money.
The exception is the value inherent in being a currency outside of the control and surveillance of the Governments. Hence all the illegal activities. As time goes on cryptocurrencies will be more regulated and controlled by government, and it will diminish that trait.
It’s fucking stupid.
Traditional currencies are backed by governments and the global economy. Boiling down USD/EUR to “it’s worth money because we say so” is many many magnitudes larger of a splicification than saying the same for crypto.
Fiat currency is just as silly. As is all money, really.
“I trade numbers for food. The numbers are accessible via a magnetic strip on some plastic in my pocket.” or “I trade paper for clothing but the number of papers isn’t as important as the number printed ON the papers.” Both of these realities are absurd. :)
As a store of value representing labor rendered: neither of those are terrible systems and most people don’t understand either of them anyway. Fiat seems “normal” because we grew up with it. That said: I’m no apologist. Popular crypto currencies offer little novelty for the layperson, no true improvement on the concept of currency generally, and cost orders of magnitude more to maintain their required infrastructure. I fail to see the appeal.
There are some projects which focus on the practical utility of decentralized currency (I remember thinking Nano (wikipedia.com) was cool back in the day) but they don’t get the same kind of attention as meme coins because they can’t be abused as easily. I’ve heard stories of these kinds of tools facilitating commerce in places where the local currency collapsed. Neat as that may be it isn’t revolutionary… Still more convenient than bartering via cigarette though.
Fiat isn’t “silly” insofar as there’s an underlying reason why fiat has value. The US dollar is valuable because the US government only accepts tax payments in USD. As long as the US government demands tax payments and has the ability to make good on those demands, US dollars will have value.
I’m gunna try to explain the basics of just Bitcoin here, its probably the easiest to understand out of all of them. It’s all based on a mathematical function called the hash function. Basically the hash function can take in any input and produce a unique number between zero and a bazillion that represents it. Statistically speaking, the outputs of the hash function are random, and if you only have the output its impossible to find the corisponding input - it cant be reversed. When a transaction happens with a cryptocurrency its broadcast to the whole network, and made very public. All the information about it, the sender, the receiver, the amount, the time, and a few other things too, all that is sent around the network. That bundle of information is basically all a transaction is. But the process of validating it is what makes it real. Some people have computer programs that collect all of these transactions broadcast across the network, and they combine them into large chunks, known as blocks. Each block, along with all the financial data inside it, has an extra number attached to it known as a nonce. These people who listen for new transactions and later store them, take the block, and apply the hash function to it. If the output of the hash function is in a very small range - with is unlikely - a new special transaction happens, from no one, to the person who calculated the hash, minting new bitcoins (rn I think this amount is 3.125 Bitcoin but that might be outdated). (This is what Bitcoin mining is). If the output of the hash isn’t in the range, they try again. The network automatically changes the size of this range to make sure that over a given amount of time the same number of bitcoins are minted, making Bitcoin free from spikes in inflation. Additionally, the network halfs the reward from mining a block about every 4 years, causing the inflation rate to drop over time. As this happens the network with settle on a fixed number of usable bitcoins, slightly less than 21 million. And that part of it makes its a viable alternative to gold, because while new gold is always being mined, its not much so overall gold has very low monetary inflation. But a large amount of bitcoins value stems from the fact that eventually Bitcoin wont have any at all.
I’d be more than happy to further explain how this stuff works, I’m no expert but I’m really interested in the math and economics behind it all. I really recommend reading the original Bitcoin paper, https://bitcoin.org/en/bitcoin-paper , its not a light read but it explains it all a lot better than I can. Have a nice day!
I’m not religious, but God bless you.
I still barely understand, but I understand more than I did five minutes ago, and that is worth something.
Why is this math problem worth monetary value to anyone if it’s just a randomly generated number? I don’t care if something generated a number somewhere. Like, good for them I guess? Why is that valuable?
It’s decentralized, so how do you prevent people from making up bullshit lies that didn’t happen about where the money is? You do it by incorporating a difficult math problem. Then to incentivize people to actually work on that instead of just using the money, people who solve it get a reward.
I am not pro crypto, just explaining.
I don’t think there is one legal use case that can only be solved by a blockchain and not cheaper and faster with a classic database.
Except money laundering, crapto is fantastic for that.
I am sure scamming people out of their money with crypto is legal in a few jurisdictions.
Just a big lottery you’ll never really win https://youtu.be/4DUkS98yw5Y
Yes. Absolutely. But I see where the appeal comes from. A few years ago I bought some Bitcoin for 50 Euro. A year later it doubled in value. That was nice. And that was moderate compared to when I first got Bitcoin and it was as cheap as dirt and suddenly it’s worth 70k. With the world in the grips of the billionaire class people get desperate for even a chance at moderate wealth. It’s a sad symptom of the fucked up world we’re living in.
Yall seem to young to to understand crypto. Its original intent was to combat the crazy bad economic stuff from 2007. It’s not inherently a scam as a category. 2007s banking collapse was really scary when it happened if you were paying attention. It made 9/11 seem like NBD. Unfortunately not much has changed and you’ll probably get to see something similar again.
Huh. I’ve never heard that being the reason, especially when crypto was supposedly made outside US but the 2007 crisis was centered around US.
The original reason is in the name.
You should read some of Satoshi’s stuff about bitcoin, its honestly pretty interesting ,he wrote a lot about the economic implications of it. Actually fun fact in the first Bitcoin block, the first transaction has the title from British newspaper about how the government was bailing out more banks.
The only crypto that makes kinda sense is the idea of a stablecoin (essentially a layer around a stable currency/reserve), but so far there’s not really a good implementation of one.
All the big crypto coins are just more volatile stocks with shittier tax implications (assuming you don’t try to skirt the law with it)
I got to be alive before mobile phones and social media.
Worth it!
I am immeasurably grateful that the entirety of my youth is not on record.
Fuck, I’m considered an ELDER now?
Dispense your wisdom, o my elder. I’m just a nineties boy, what do I know of the world before ?
I was born i 85. Not much more wisdom I can give I’m afraid. I am a tech early adopter and a coder so I understand crypto it’s just too volatile a market for me to care about. Wish I had invested in Bitcoin when someone asked me if I wanted to in 2012 though. Mostly my driving force for new tech adoption was my gaming habit. I had a colecovision, NES, Genesis, Playstation, Playstation 2, and all the systems from the next gen onward once I had job money.
The real brain melter was the societal culture shift.
I grew up witnessing “the end of history” with my own eyes. People were getting wiser and kinder year after year, decade after decade. It was like a feedback loop of positive changes, the only way was up.
Then 2010s hit and I’m still processing the 180 degrees shift. I read dozens of books about nazis, authoritarianism, societal memory, cults, fucking roman empire. But I still have cognitive dissonance every time I open news feed.
Facebook and unregulated social media. Up to now most governments in the world don’t even have a clue or idea that the internet is a very powerful tool that should actually be regulated because there are very evil people who will always act in bad faith to manipulate others for power and control. The Golden era of the internet is definitely over, I think 2016 was a defined shift that will be recorded by historians.
In fairness, most internet users would have been extremely against regulating social media until quite recently
it’s all about how the regulations are designed… for the benefit of corporations? or regular people?
for example, there could easily be rules placing caps on the amount of advertising that’s allowed on any given platform. no fucking way now the government will ever put that cat back in the bag now that the 20 percent of GDP comes from tech monopolies fueled by advertisements.
Early internet was very much regulated. I wish we could all just go back to usenet and no internet on phones.
Holy shit thank you. You finally put it into words for me. The shift of 'the internet is the greatest tool for knowledge, to what it is now, some cancerous corpo bloated bullshit that ignorant people are harnessing just to find others to support their shitty beliefs. Been such a hard thing to watch and understand how the fuck we got here.
I think it’s lack of empathy as the root for everything.
Which I believe is opposite of human nature but here we are.
Empathy is easily used for propaganda as well. All those “immigrants are going to r your wife” and “radical elites transing your children” are the appeals to empathy that work very well (there are examples from the left too lets be honest, they’re just less unhinged)
IMO you need empathy, rationality and introspection: empathy to feel for your fellow human, rationality to not fall for the grift, introspection to realize in what ways you were an idiot and self-correct.
The wave of scepticism that will inevitably come in 2030s will weed out the grifters, but I doubt it’ll last. Time is a flat circle afterall.
I’m reminded of this article from a couple of days ago in the Globe and Mail, specifically as a response to Musk’s anti-empathy comments: Empathy is not a Weakness, it’s a Strength
The shift of 'the internet is the greatest tool for knowledge, to what it is now, some cancerous corpo bloated bullshit
Spot on.
The worst part is that anyone who wasn’t around for the first 10ish years of the web has never seen how real and optimistic and grass roots and delightfully human it was.
We really lost a lot.
We used to think pop ups were the worst that could happen. Good god were we wrong.
The real brain melter was the societal culture shift.
I grew up witnessing “the end of history” with my own eyes. People were getting wiser and kinder year after year, decade after decade. It was like a feedback loop of positive changes, the only way was up.
Then 2010s hit and I’m still processing the 180 degrees shift.
Fucking thank you! This has been hard for me to put into words. (I’m on the older end of Gen-X)
From “The Hunt for Red October”, to “you shouldn’t have started the war against russia then.”
Red Dawn to half+ our leadership bowing down to him, and a president calling him a good guy.
God damn what a wild ride.
The internet came way too quickly, or at least it evolved way too quickly for us. We should still be on 56k and surfing Limewire for what may or may not be what we’re actually looking for. 24/7 access to everyone all around the country, and world, was too fast as well. We can’t acclimate that fast. Our brains weren’t ready for it.
Eh, I still think people are generally pretty nice to each other. The problem is that when that same nice person goes online, they behave differently. The more time we spend online, the more impact that “alter ego” has on our “IRL” personality.
So what we need is more IRL connection, but we’re instead spending more and more time online.
That is just not true. Plenty of nice people online and plenty of assholes since before online was even a thing for the average person. In fact if anything it feels like those assholes from before are re-asserting themselves.
Is it though? I find myself being a lot more combative online and more agreeable in person. That separation of my actual identity and lack of physical repercussions really makes me more confrontational online.
To be fair, us elders had grifts and money laundering too, so crypto is nothing functionally new.
No hate, but this is exactly proving the point of the meme. There’s so many new concepts and paradigms, each so complex and constantly evolving, that we need to rely on familiar comparisons that strip away the true identities of the subject. And I think this is true for pretty much every everyone in this information (bombardment) age, myself included.
People tend to forget that cryptocurrencies are based on cryptography, and were founded on the dream of building a decentralized system, built by the people, free from “big player” censorship and influence, in the wake of the 2008 crisis. If you are on the Fediverse, I guess you share that dream. But then the finance “bros” started coming in and badabing badabang now it’s another asset you trade through your bank like stocks or gold. Then came the NFTs and yes, somehow “crypto” evolved into being the prime speculation and scamming vector.
And the same goes on for every news topic. “Trump!” “Gaza!” “AI!” “Climate!”. Our brains try to reduce these mind-melting concepts hitting us all the time to simplified good/bad or us/them categorizations. And we’re left utterly unable to actually tackle and act upon anything at all.
No, no one is forgetting they’re built on cryptography. It just doesn’t matter. The underlying technology of a thing doesn’t have much bearing on the properties of the thing as far as practical usage goes.
You don’t care what your car is made of as long as it has good fuel efficiency and crash rating. Steel ceramic and aluminum are just tools to that end.
Research into cryptocurrency started long before 2008. Academics and odd crypto enthusiasts have been working on it since the 80s.
The intent from the beginning has been a mix of curiosity, paranoia, and buying drugs.
Bitcoin was hardly a “for the people” project. It was initially used almost entirely for black market purchases, largely via silk road. “The people” did not give a fuck about perfect anonymous digital cash. It solved a problem that most people didn’t and still don’t have.
The adoption order was: Math nerds > drug lords > finance > small investors. It’s still not actually adopted as currency by people.
When you create a thing for the purpose of making monetary transactions untraceable, and your first major users are all using it to hide where their money came from from the government, it’s really fair to say that you created a money laundering tool.
Bitcoin wasn’t taken over by finance people, they’re the reason it didn’t taper out like previous cryptocurrencies, which either fizzled or were shutdown for being nuggets of financial crime.
Sorry, but then by that argument cryptography itself is bad because “pedos use it”? Criminals will always use privacy-preserving technology/techniques/strategies. Should we renounce our right to have secure communication, or a decentralized currency because of that? Hasn’t this argument been done to death already?
The underlying technology of a thing doesn’t have much bearing on the properties of the thing as far as practical usage goes.
Excuse me, what? Of course it does matter if the backup for all your life’s photos is in an hard disk in your living room, or it’s on Google’s server. Of course it matters if the platform we’re talking on is Lemmy, and not Reddit. It does make a difference if the car you’re driving is gas or electric, where it was made, if it shows you ads or not. What are you going on about? It makes all the difference in the world, but that’s on “the backend” and no one remembers that it does matter
It’s really not proving much of anything. These new “concepts” and “paradigms” are nothing more than buzzwords thrown onto old concepts. Every scam is a scam that’s been done before even if there’s a new layer of glittery wrapping paper over it. Who’re you trying to convince more, the potential suckers or yourself?
The internet is a buzzword thrown onto old concepts? Instantaneous transfer of large amounts of data? Democratization and seamless diffusion of anything, from memes to “money”? “no but crypto is indeed a scam” is completely missing my point, and hitting the meme again
I keep saying that humanity’s toys do evolve spectacularly while humans are still working on the same basic impulses they’ve been dealing with for millennia.
Trump is a petty conman who does everything in his power to consolidate as much power in himself as he possibly can so that he can funnel as much money to himself and his gang as he can. That’s not new. The environment he’s doing in may be more complex, or differently set up than in previous iterations, but the core is depressingly mundane.
Gaza is just people hating people and other people supporting different sides while all sides give each other more reasons to hate each other perpetually, some more war-crimey, some less so. Tragic, quagmired to hell and back, but not groundbreaking in and of itself.
As for AI, the framework is the usual capitalists trying to convince everybody that their new best revolutionary thing is a word sorting machine that can sort very, very many words now very fast. Trying to cash in on the hype is the eternal constant, the occasion this time is a very sophisticated chatbot/image generator based on all the materials the inventors could get away with stealing.
And climate stuff is just this generation of capitalists stripping the planet for parts while they can get away with it. The scale is bigger, but vulture capitalism is also not even remotely new.
Just like the principle of singular attributability of data via the blockchain is a fancy way of assigning stuff to one recipient. We’ve had approaches to this before. This time the blockchain’s ledger system is the big new anchor for the human element, which will invariably at first be either grifters or people who wanna bash in other people’s heads with it.
