We all saw this coming....
I mentioned before my conversation with the annoying man who expounded, at length, his conspiracy theories and whatnot. There was a name for what he was doing - "Gish Gallop" - where a person just throws out one stupid argument after another until the opponent is just overwhelmed. He also engaged in "Sealioning" - demanding "proof" for any counter-argument I made, while providing none for his. It is the modern form of thought and debate - trolling. He was alone, of course, and lived with his mother ("just temporary" he said) and chastised me for not "getting" crypto.
To quote Ron White, "I'm listening!"
But he never really explained crypto to me, as I don't think he really understood it, other than a collection of buzzwords that he felt made him sound smart. And yes, he lost a lot of money in crypto - as well as in stock options - and blamed "the banks" for his downfall. By "a lot of money" he probably lost only a few tens of thousands of dollars. People like that have no conception of real wealth, only gambling.
And of course, his losses in these "investments" only served to bootstrap his belief that the whole system was rotten and should be overthrown, because his get-rich-quick dreams were derailed. Notably lacking in his thinking was any introspection or accountability for his own actions.
It is like Lauren Bobert's financial disclosure form - really pathetic if you think about it. She tosses a few thousand dollars at trendy stocks and crypto and doesn't seem to make much from it. Even her crappy restaurant (which never even sold beer!) is out of business, and her now ex-husband's "consulting" services apparently earn a big zero in income. But she's a playa!
It is a tale as old as time. Act rationally in an irrational world. People want to become millionaires overnight - why not? Everyone else is! What they don't realize is that the people who become millionaires overnight do so on the backs of people like you and me, who buy into their investment schemes and cons.
When it all goes bust, they cry for help. It isn't fair! I was supposed to get rich! The system is stacked against me! I want a government bailout!
Crypto came along at a perfect time to snare people who had already been snookered in the crash of 2008 - or were too young to remember it. These are people who got caught in the middle of a buy-and-flip plan or some other get-rich-quick scheme, and when it all came apart, blamed the banks for their misfortune - because they wanted that loan money paid back! In a fit of pique, these sort of folks smashed their granite countertops before the Sheriff evicted them, because if they can't have the dream of granite countertops, no one can!
I should note the obvious: They ended up paying for that. When you are foreclosed upon, the bank sells the house for whatever they can get and then sends you a bill for the difference between the mortgage balance and what they got for the house. If the house was degraded by vandalism, well, that means the homeowner is on the hook for even more money. But hey, that involves mathematics - subtraction! And we all know you don't need to know math in "real life." So smash away!
I digress. I guess the point is, the same belligerent folks who thought they were going to make "big bucks" with no work or effort or risk - the same folks who laughed at and mocked the rest of us for "not getting it!" are now crying foul and wondering why it all went so wrong.
Others are trying to sift through the debris trying to find a "cause" of the meltdown - as if you could pin it on one single thing (other than their own gullibility) and thus not be at fault. "It would have worked!" they cry, "If not for [fill-in-the-blank lame excuse]" The same argument is made by apologists for Communism. The fundamental idea wasn't flawed - no, No! It was all in the implementation. A Century later and tens of millions dead in several countries and they still cling to this argument.
The latest weak excuse is this frizzy-hair guy who ran an exchange and a sort of cobbed-together investment coin. I won't go into the details because I saw no need to bother to investigate them myself. A snake-oil salesman is a snake-oil salesman. Crytpo is a con. No one should be surprised when they lose money at it. You can spot a raw deal at 100 paces - no need to analyze it further! The more complicated you can make any transaction, the easier it is to fleece the customer.
And in regard to that last mantra, there was so much smoke-and-mirrors going on with "crypto" it wasn't even funny. The "true believers" had that wild-eyed look you see on people who have been to three-day camp revival meetings without sleep or food. They are hypnotized and not thinking straight.
So they blame this frizzy-hair guy for the meltdown of "FTX" and try to point to some specific event or thing that he did that caused it. Once they find the "flaw" in the plan, well, it will show that crypto was a good idea, it was just this one guy being a bad actor (and I guess all the other just one guys who have caused exchanges to collapse or have otherwise stolen from "investors").
It is like this Theranos deal. Henry Kissinger is exhorting people to invest in a new company, and the product is a revolutionary new medical device designed by a high-school-aged girl with a funny voice. Yes, someone not even old enough to buy beer has outsmarted all the world's scientists who have been working in this field for decades. How many red flags do you count here?
- Henry Kissinger
- High-School Aged Inventor
- Funny Voice
- Doing the Impossible, easily.
I am sure there are more. Do you feel sorry for any of the investors in that scam?
What is interesting about these scams is that investors are suing celebrity "influencers" who were paid to endorse these things - often failing to disclose they were paid endorsements. I am sure The Sooze is sweating in her socks right now, after she suddenly and spontaneously endorsed Bitcoin a few years back. But it makes sense and I hope these celebrities and influencers are forced to cough up some dough - it might rein-in this burgeoning form of not-so-subliminal advertising.
But does this mean the end for "crypto" in general? It is hard to say, of course. Some predict that some of the wackier coins that were obvious scams will disappear over time - and many already have. The big players still have a use for large-money transactions across national boundaries for illegal purposes - so long as governments allow this to occur. Maybe the government can't control crypto, but they can shut down an exchange or make it very hard for the exchange to convert crypto to local currency and vice-versa. Somewhere in the system, you have to interact with a real bank. Ask any marijuana dispensary about this - they have to deal in all-cash as a result.
But as a currency? The technology will have to change dramatically. Each Bitcoin has a complete registry of every transaction it was involved in. Over time, this registry gets larger and larger, and as a result, each transaction takes longer and longer to process - and costs more energy to process. The time has long past for Bitcoin to be used as a "currency" to buy a Starbucks, or groceries. And as recent times have illustrated, the "virtual gold" argument was just a way of propping up the price of these "coins" to keep the little people investing.
For us little people, the point is moot - we have no business speculating and gambling on things we don't understand which are being hyped in the media. Sure, maybe Henry Kissinger can afford to lose a few million in some scheme, but for working-class people, even a few thousand represents months of savings. In the long run, it is better to invest in "normal" things rather than get-rich-quick schemes.
But yea, I am experiencing a little Schadenfreude over this - all the people who claimed I was an "idiot" who "just didn't get it" are now crying in their soup. And I don't feel sorry for them one whit. It is one thing for some innocent person to be snookered in by a con-man. It is another when the victim sneers at you when you try to warn them of the con!
