Another one bites the dust.
This time, it is BlockFi.
It seems that these crypto exchanges are far more inbred than they were believed to be, with each of them "orgying" up with each other in less than upstanding ways. By the time all the people who keep their coins on exchanges have lost their tokens, there aren't going to be many crypto holders left. I for one am making sure that mine is safely tucked away into hardware wallets.
What is interesting with this "consolidation" period is that once all is said and done, there is going to be a more "honest" accounting of major crypto holdings across the industry, which could mean that there is also a more accurate evaluation of tokens across the industry too. But at the end of the day, the game stays the same - not your keys, not your crypto.
One thing is for certain however, none of this is making crypto seem any more professional in the public eye, where there is essentially gross mismanagement and very much the same behaviors going on that plagues the traditional banking industry. The difference is of course, that it is far more visible in crypto and, the media are willing to report on it. It doesn't matter that the banking industry does similar with junk stocks, overinflating their holdings in what is essentially shitcoins, crypto is always going to be in the crosshairs.
Which is why you'd hope that these exchanges would hold themselves to a higher standard of operations, but that really is too much to ask. Expecting people to Act well is a losing game, which is why in crypto code is law is such an important concept, because those in the know, know that unless hardcoded, "best interest" doesn't matter, only selfinterest.
Especially in the disconnected social world in which we live today, the vast majority of people are going to act according to their needs, even if it is going to impact negatively on others. In areas where there is anonymity and pseudonymity, this is going to get even worse, and crypto is like financial Twitter, with literal point-scoring over others - even though those others are unseen.
The FTX debacle is a high-visibility look at what is actually going on in the financial markets, where there are those who are playing fast and loose with other people's value. High-confidence, low social moral, groups of individuals who would be right at home working at any of the largest banks on Wall Street, indulging in high-risk behaviors and debauchery, professionally and personally.
Perhaps finance has a type?
It is to be expected though, because we tend to repeat what we know and what we know is what has always been. So, while there is the potential for far better economic practices and financial management, the reality is more like the "end of the world as we know it" shows, where as soon as things start to settle, a new government is installed and society starts to again resemble what led to the end of the world in the first place.
We are conditioned.
We tend to fractal on our experience, replicating what we have learned through it rather than actually innovating away from it. We are on average, far less creative than we would like to believe ourselves to be and as such, we are going to run predictable patterns, and as we should know, predictable patterns can be utilized to generate value.
Be where the ball is going to be.
When there are behavioral patterns, it is easy enough to predict what masses of people are going to do and one of those things has obviously been, keep their tokens on exchanges. With all of that value "just sitting" there, the temptation is too great for these people not to use it for their own ends and as their confidence builds, they are going to reach further and then, overreach too far, no longer able to cover what they have "borrowed" from their customer base.
This has been an excellent exercise in why centralized exchanges are not the way to go, because once that value is available to a tiny group of decision-makers, it is going to be used and in crypto, there is essentially no recourse for those users. And in the traditional economy, the "recourse" is that they get bailed out by governments, which is essentially using community money to pay off the losses of investors, spreading the risk to everyone, rather than those who actually took the risk.
Will we ever learn?
Unlikely.
I used to be an optimist, but over the years I have become far more pessimistic in our ability as a species to improve our behaviors, especially at scale. The world is changing in so many ways, but especially over the last decade, the social disconnection is spreading like a plague and over the last couple years, ramped up even faster. Economic challenge is a symptom of much larger issues in society, but improving economic activity can improve societal conditions. However, if keep repeating the mistakes of our past, the economic outcomes are going to be, exactly what we are getting now, amplified.
Even in hindsight, we are largely blinded.
Taraz
[ Gen1: Hive ]
Posted Using LeoFinance Beta
We tell landlubbers that fishing is great; but warn them to do it from boats a few hundred metres out.
Over time the shore fills up with amateurs, who can't be bothered with boats.
Inevitably a tidal wave (which passes gently under us) hits the shore and drowns them all.
Then the guy on the TV tells everyone that fishing is dangerous.
Boat's will be seen as a necessity for a while now; but over time, more and more will forego the complexity and just fish from the shore. Human nature.
And this is the crux of it - with so many people who have been in for ages "knowing" that they shouldn't stay on exchange, back on exxchanges. If they had stayed in hardware wallets, the damage would be far less.
It's the fiat-tested structure that is replicated and brought to crypto because...Greed. And trust where checks should have been made. Somehow, I rely on all crypto wallets, including those on exchanges, to be blockchain-verifiable and I rely on some strangers being interested in regularly monitoring those. I guess that has not been the case.
Anyway, a lot of the hype-related phenomenons scared me as too good to be true since the beginning and luckily, so far, I've managed to stay out of it.
I still keep some crypto and fiat on an exchange, because of the time it takes to actually enter a position once you want to. In traditional stock trades, you have what from a web3 perspective looks like ages to react to a market condition.
In crypto, though, there (seems to) be some serious gunslinging going on.
Precisely.
We shouldn't rely on anyone, which is a sad statement of society.
The gunslinging culture fits very well with the wild west legislation :)
Buying the promise of a virtual token...imagination is such a wonderful thing. Quite destructive, too.
— an imaginary Babylonian dude by George Clason
All right. I do entrust some of my assets to institutions which have proven themselves so far but I don't forget it is just...So Far. Which could be said about anyone, given a Far of that anyone's choice. Still, I need to do so in order to be flexible and have those assets loaded and ready to go when the moment arrives. A small portion we can comfortably (except for the peace of mind or the lack of it after any blow to the pride and wallet) survive without is the rule here, though. It is, after all, a part of the diversification strategy.
And it remains a game.
And there's nothing certain. While adding fat is a strategy, so is learning to live lean. It's not the perfect metaphor, meaning
I have learned how to add fat pretty fast but then I have problems liquidating it ;)
For a long time, the world is going to remain a place where emotions, rather than logical behavioral thinking, prevail in our decision-making as humans. If we as a species collectively follow through on how things should actually be done, rather than how we "feel" we'd like things to go, the world will begin to change for the better...maybe.
For a long time and perhaps forever., I feel that we are becoming less able to control our emotions and are instead increasingly acting on how we feel.
I am glad that I only have hive. otherwise I would likely forget some crypto in exchanges and would lose it.
These days I am only optimistic about basketball...
So many are losing their hats, after already losing their hats before...
The World is changing so fast and so many ways... Hoomans need to adapt and adjust themselves accordingly to survive or not Getting affected.
Did expected BlockFi Going Down since there was also rumor... But also heard another Exchange "Bitfront" Announces to shutdown and Two bites the dust in one day.
Ever since I become victim of keeping fund in exchange since then I ain't keeping anymore.
I have never heard of Bitfront, though I imagine there are more on the way or smaller ones already gone.
I've thought about it many times. So you should make the most of it for yourself. I really haven't been able to do that so far (only small things), but it's exhausting to contemplate it year after year. Writing about it, by the way, is also an option. True, there is a very small chance that it will change at least a few people at a time...
!invest_vote
It is exhausting....
Writing about it helps - at least for me, it helps me balance the emotional side of it far better than if I was to keep it all in my head and heart.
Centralized exchanges are definitely not the way to go but I guess Coinbase might be the only one people can trust to an extent. They still have to follow the regulatory stuff for public companies so I doubt they would mess up like FTX. However, it's always safest when the crypto is in your hands and not with someone else.
Posted Using LeoFinance Beta
One of the reasons for storing on exchange, is it is easier for multiple tokens. Getting everything off is frustrating and expensive.
FTX contagions, and it was pure fraud.
Cryptos cannot just be printed out of thin air, banker treated them like dollars and leveraged beyond imagination. Not sustainable.
Yes.
I am hoping that there will be "better accounting" in the future in regard to these things. Self regulation is unlikely to happen though, because the customer base (us) are idiots :)
I've been doing what I can to make sure I don't have many if any tokens sitting on any exchanges any more. I need to move my monthly buys off Coinbase now that I think of it. It is going to be a tedious process, but I know it is the safe and smart thing to do. I agree with you. The traditional system is mismanaging funds way more than what we have seen but the media likes to key in on the hot thing and try to run it down.
Posted Using LeoFinance Beta
It is tedious and relatively expensive to do all of the conversions and transfers. Hive is pretty good in this regard though :)
Yeah, I just wish there was an easier way to go from USD to Hive. It would actually be a bit dangerous for my real world budget! :)
Posted Using LeoFinance Beta
Few days ago I thought about it. I think only the technology has been making progress for years. Rather, our social behaviours and relationship have been going back.
We say;
Everybody is preoccupied with their own roubles for a long time, which is mostly due to economic issues. Also, I noticed that people choose to live alone... The pandemic might have triggered this demand.
I think so too. The smarter the tech gets, the stupider we are becoming.
Mainstream media still does not report correctly what happened at FTX. WSJ continues to give Sam Bankman-Fried the platform and paints him as a philanthropist… what’s going on?
He gave a lot of money to a lot of people, even if it wasn't his money to give. Some made a packet off of his "philanthropy"
For as long as I've held crypto, since 2010 when I made our first purchase of BTC, my son preached the fact that if you don't hold the private keys, your investment is at risk.
That fact has been stated many times, yet people leave their tokens on exchanges.
After Celsius hit the skids and so many people lost money because of their practices you would think people would smarten up.
If it sounds too good to be true it is likely to fail but yet many people will take that risk hoping for that big payday.
F--k me once shame on you, F--k me twice shame on me.
And many seem to never learn until it is too late.
Yes. Some people seem to enjoy being bent over time and time again.
Maybe we are getting immune from it all now. Short-lived dip.
At some point, there will be a balance for reality and then, boom?
This however requires changing ideology of what is been done in the past because it won't seem appropriate repeating the same mistakes been done before but having a different mindset positively would really change things for good.
Some people seemed doomed to keep repeating.
Hive does not need to be stored on the exchange, they do not pay for it%
Exactly. Hive is one of the best options out there :)
I was very close this time, sent my 0.1 BTC back to my wallet, and got confirmation that will be sent, then they announced stopping withdrawals and it never came. Talking about being optimistic.
Have you now taken everything off exchanges and put it into wallets?
No, I never learn, is like 50% /50%.
Thanks for the informative blog
You are welcome.
The world is changing us. I was optimistic, too, but over the years I've become much more pessimistic about our ability to improve our behavior as a species, especially on a large scale.
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