Yes but the recordkeeping for crypto and the clearing of trades in crypto is a technology that totally relies on the computer network. And if that computer network does not exist anymore one day, the recordkeeping will completely collapse. If tomorrow, the computer network doesn't exist anymore, we can still trade and we can still have a record of the financial assets that we have today regardless of whether we have seen or received or have the physical certificates or not. The fact that we can have and have had them before makes all the difference.
Uprise lost 99% of client funds while shorting LUNA
- Thread starter The_Krakenite
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Yes but the recordkeeping for crypto and the clearing of trades in crypto is a technology that totally relies on the computer network. And if that computer network does not exist anymore one day, the recordkeeping will completely collapse. If tomorrow, the computer network doesn't exist anymore, we can still trade and we can still have a record of the financial assets that we have today regardless of whether we have seen or received or have the physical certificates or not. The fact that we can have and have had them before makes all the difference.
But from what I understand, that's not how blockchain operates (or so it claims):
"A blockchain is a decentralized ledger of all transactions across a peer-to-peer network. Using this technology, participants can confirm transactions without a need for a central clearing authority. Potential applications can include fund transfers, settling trades, voting, and many other issues."
This is where we need regulation. How does Voyager get off by saying all of the customer accounts are their assets not the customers. I guess you need to NOT keep your assets at an Exchange until or if they created insured segregated customer accounts like a normal stock brokerage has. Thankfully, I did not have any of my assets at Voyager.
What an exchange should be able to do is just make money off of the the fees for buying and selling the coins. They should NOT be allowed to lend out customer coins to another 3rd party. Yes, banks can lend out customer money as loans for people to buy houses but the customer money is FDIC insured.
Presumably they had liquidity issues exiting the short and contributing to the upward spike whilst trying to exit.
"AI powered bla bla bla" really won't help you if you don't have the core risk management correct, one might say immutable law to all traders.
"AI powered bla bla bla" really won't help you if you don't have the core risk management correct, one might say immutable law to all traders.
And the auditing of those exchanges' books too.
Uprise was continuously rebalancing on the way down, reinvesting paper profits into the short, maintaining or even increasing the leverage. Akin to rebalancing a leveraged position on the way up to maintain some multiple. Works absolutely fantastic until it doesn't. A sprinkle of risk management, à la rebalancing the leverage lower as the position moved against them may have saved their asses. That takes discipline though, lightening a position that's moving against you, locking in potential losses. Obviously they lacked either the insight to know what to do or the necessary discipline to execute. Either way, some people aren't cut out to be traders. Too bad their clients have to suffer but that's the game.
Interesting. Yeah, that screams "noob".
What do you think would happen if the digital world would not exist anymore? You think losing all your bitcoin would be the biggest issue?