Why This Computer Scientist Says All Cryptocurrency Should “Die in a Fire”
- Thread starter Frederick Foresight
- Start date
LOL... Well I guess traditional banks are scum as well because the FDIC issued enforcement actions on 12 different banks in June and 12 more the month before that.
I read all the cases that I could find on the link you gave.
- 2 cases are about people stealing money, so NOT the bank.
- 1 case was about fraude by a bank employee who was stealing from the bank. So NOT the bank.
- 1 case was about a bank employee who abused his position to take cheap loans at the bank. So NOT the bank.
- 8 cases were about compliance problems without any financial impact.
And I don't see how that can even compare to the 2 trillion loss of value of the crypto's in the last meltdown.
Thanks, I appreciate the kind words and favorable assumptions. Blunt truth is that I have a visceral aversion to cryptos and, therefore, fall prey to confirmation bias at every opportunity. And as I noted, I am not very computer/tech savvy. So it is not a market I would naturally gravitate towards. I would never trade it long term because, from the little I have read about it, it may not have a long term. It just doesn't pass the smell test for me. (Or maybe I'm just too lazy to study and learn.
) Meanwhile the short term price action does not align well with my approach whereas a few of the more conventional markets do. And so, I like to offer up the occasional fly in the ointment to the rah-rah threads and posts in this forum. 
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Very recently I was anti crypto in attitude but the last couple of weeks ago changed my mind.
My opinion, viewed as an investment - it's not a good idea to hold crypto, that line of thinking hasn't changed.
But for trading, it is as the market but on steroids.
Crypto imo, is easy to trade, it correlates well with market swings, not at all like gold which one day to the next don't know what's going to happen.
So in otherwords imo crypto is quite predictable and not difficult to trade.
Unfortunately, the markets in general the past several months have been bearish so crypto has not been performing and recently the past two months crypto has been sluggish.
But here is a snapshot of SPX versus a handful of different crypto ETFs in March this year when the markets took a short bounce. SPX up ~10%, ETF's up ~30%.
Mostly, crypto ETFs are a recent addition to the market so haven't been able to prove themselves.
If I look at a couple of US based crypto stocks, a similar picture emerges, a profitable easily correlated bunch of good performers, here SPX versus MARA, MSTR, RIOT.
My opinion, viewed as an investment - it's not a good idea to hold crypto, that line of thinking hasn't changed.
But for trading, it is as the market but on steroids.
Crypto imo, is easy to trade, it correlates well with market swings, not at all like gold which one day to the next don't know what's going to happen.
So in otherwords imo crypto is quite predictable and not difficult to trade.
Unfortunately, the markets in general the past several months have been bearish so crypto has not been performing and recently the past two months crypto has been sluggish.
But here is a snapshot of SPX versus a handful of different crypto ETFs in March this year when the markets took a short bounce. SPX up ~10%, ETF's up ~30%.
Mostly, crypto ETFs are a recent addition to the market so haven't been able to prove themselves.
If I look at a couple of US based crypto stocks, a similar picture emerges, a profitable easily correlated bunch of good performers, here SPX versus MARA, MSTR, RIOT.
LOL likely $2 trillion of mostly paper losses.
Buy something at 10, it goes to 100, comes back down to 10 and you sell breaking even. You didn't lose $90 of profit. Profit, if any, is only determined ......... once a trade is closed out.
The market value of the crypto's went down 2 trillion.
Buy something at 100, comes back down to 10 and you sell with a huge loss. You did lose $90.
Let's take a real situation that we can check. Baron bought three different crypto's at many different times. He is down 63% in less than 1 year. That's reality. If the market does not recover he should never sell what is left, because following your logic, he will then never take a loss. LOL.
If you sell today all money above 20906 is lost as that is the price you will get.
MTM is what should be applied.
https://www.investopedia.com/terms/m/marktomarket.asp
At Barings bank in the UK, a trader named Leeson followed your logic. He never sold his losing positions. Result was that the whole bank went down.
https://en.wikipedia.org/wiki/Barings_Bank
The bank collapsed in 1995 after suffering losses of £827 million (£1.7 billion in 2021)[2] resulting from fraudulent investments, primarily in futures contracts, conducted by its employee Nick Leeson, working at its office in Singapore.
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True but you've got one ugly equity curve.
Never said - never sell.
As to Baron, he hasn't sold so he hasn't lost anything to this point. That is reality.
$SPX is still below alltime highs, so there are folks who are underwater too. There are folks who are short from below, those folks are underwater as well.
But for some reason cryptos, in almost every respect, are held to a higher standard. A higher standard that no other asset is held to. Why is that? We know why, anti-cryptos crybabies have nothing better to do with their time.
Not really. Flat is flat.True but you've got one ugly equity curve.
If the crypto does not recover it will be a never sell or sell at a loss.
We are now at the level of dec 2020. So to make no loss you should have bought before that date. And since that day no profit at all.