[droptablemain]

The Solana trenches are effectively a giant crime-riddled casino. Everyone who plays understands this -- you can make money but you're essentially gambling. I'm not saying this is OK, but it's the current state of things.

When this $Libra token launched, everything else dumped as capital flowed into it, and then effectively got siphoned off by insiders. So even people that didn't chase "Argentina's coin" got screwed. Rinse, lather, repeat. There are some winners in this game, mostly insiders and cabals, but a whole bunch of losers.

I would say something's gotta give, but the stark reality is that America's casinos are always jampacked with dream chasers.

[manquer]

> you can make money but you're essentially gambling.

It is much worse than that, legitimate gambling is fine.

In meme coins everyone knows they are scamming and and it is a pump and dump but just think that there would be some dumb "bag holder".

[maxbrt]

I was at an (academic!) conference about Crypto recently with a friend. I am an outsider to the whole topic and wanted to "expand my horizon" and see if maybe my expectations of if it being mostly a scam were wrong.

In one of the first talks we went to, the panel speaker mentioned that Trump pumping-and-dumping his memecoin was a good thing, because that more or less justifies their own position in doing so, and that it would maybe lower their legal fees in the future. This was followed by a big laugh from the audience.

These people fully know what they are doing.

[quantified]

Sort of like a casino version of musical chairs, but the there's no music.

[TZubiri]

I don't get the crime part for the most part.

If you know the rules of the game and you willingly participate, then how is it different from any casino?

I don't buy into any of the people that claim they were scammed, they knew the rules and they tried to make money out of nothing. Other than perhaps trading unregulated securities, I don't see the actual fraud.

To be clear it is distinct from pretending to be a security for an actual productive company, that is actual fraud, but usually the coins are very transparent about having no underlying value.

[rsynnott]

> If you know the rules of the game and you willingly participate, then how is it different from any casino?

If _everyone_ playing the game knew the rules, no-one would play. Like all fraudulent schemes, these are fundamentally dependent on getting in new marks.

These memecoins are essentially partially open Ponzi schemes; there are the organisers (occupying essentially the Charles Ponzi role), the naive marks (occupying the same role as the marks in a conventional Ponzi scheme), but in the middle you have the gamblers, the people who are _aware_ that it's a fraud, but also aware that if they get in at the right time they can take some money off the marks and the gamblers who misjudge their time of entry.

(To _some_ extent this dynamic exists in some conventional Ponzi and pyramid schemes; "this is obviously a fraud, but if I get in early I might be one of the winners" is a game that has been played before. Meme coins have really turned it up to 11 tho)

[TZubiri]

Yet people play at casinos all the time.

There's always people that are ok with gambling and losing on the long run.

But there's people that recognize the zero sum, and bet that they are the ones having the advantage.

It's not like people bought the coin thinking they were helping the country, only conmen trying to outcon the conner bought it.

Although there definitely is an argument for tricking laypeople, I think it was just crypto traders and kids speculating on a coin.

It's very common in cons for the mark to think they are the conmen I hear.

[jerojero]

Cigarettes also exist and people smoke and get cancer from smoking all the time.

Does this mean cigarettes are a good thing? Why do they exist in society if they so clearly harm people?

There's a big industry around smoking that has managed to perpetuate itself in society despite the fact that it causes harm. This doesn't mean there's a good reason reason for it to exist; the reality of the situation is that you can entrench yourself in society and become very difficult to remove if you have enough power to do so. It might be that in 100 or 200 years the cigarette industry is finally gone.

Pretty much the same applies to Casinos. Yes, people play at them, and a lot of people that go to Casinos have a gambling addiction. For some, perhaps most, casinos provide a degree of entertainment that is not really a problem but ultimately Casinos are set up as a business that relies on people losing more money than they win. There's things like lotteries which seek to channel gambling addiction into social good.

And even in this scenario; Casinos are highly regulated. Which crypto ponzis are not. The existence of crypto gambling is simply a failure of regulation which is slow to adapt to new technologies. Yeah, crypto bros are in luck that there's an administration that goes as far as to encourage people to fall for these scams. It doesn't mean it's something that's going to last.

[TZubiri]

I concede that just because something is consensual doesn't mean that it is ethical or legal.

However there is and should be a legal difference between selling tobacco to unknowing customers, like in unlabeled soda or ice creams, against selling to cigarette buyers who are informed.

Similarly security laws are in place to protect legitimate investments, the courts do not want to be involved in inproductive speculative trades. You need to have some nuance between speculative casino games and genuine trading.

You can't treat both cases the same, if you do you do it at the expense of genuine commerce.

In this case, it crossed over to the criminal kind because it passed as an investment security, and was sold as such. So I do backtract in what I said in my original comment, I do see how THIS is a crime, but not other stuff like say, other typical pump.fun coins. Mostly because I learned a bit more about the case.

[southernplaces7]

>I don't get the crime part for the most part.

Neither do many of the people who say such a thing here. Instead they regurgitate classic HN talking points around crypto without really considering their logic.

Simple example: calling something like bitcoin a "ponzi scheme" when it's literally run by nobody in particular and has no specific fraudulent promotion being done by its administrators (since there are none) for the sake of personal gain through redirected funds.

[TZubiri]

I do think that there' nuances to crypto. But even bitcoin has some ponzi like properties:

1- high reward to early adopters 2- needed to be shared to have value

Although I will make the important distinction that the asset doesn't lose value once it can no longer be shared, which is typical of pyramid schemes. Quite the contrary, it reached critical mass and gained first mover monopoly

[rsynnott]

_Bitcoin_ isn't a Ponzi scheme, though it does tend to behave a little like one. Many of these memecoins are, essentially, intentional Ponzi schemes, tho.

[andyferris]

Is there such a thing as truly "unregulated" here? What I mean is - pyramid schemes are illegal irrespective of the mechanism, so there's always _some_ basic regulation for these things.

I feel pyramid schemes are just a special kind of pump-and-dump scheme, and I don't understand how these aren't being punished effectively and swiftly by the existing laws and enforcement agencies...

[TZubiri]

Unregulated means that it isn't presented to the regulating authorities, not only is it not submitted for approval to the SEC or the Argentina equivalent (CNV), but it wasn't even submitted for chartering as an LLC (SRL) or Corp (SA) in any Argentina Jurisdiction.