[zer0x4d]

I'm a huge crypto believer but I can admit that we don't have a serious system if a person can just transfer over $1.5B from a well known crypto cold wallet to different accounts with nothing flagging it and no way to reverse it.

[stouset]

In the face of the never-ending list of these kinds of events, the laughably impossible task of average nontechnical individuals protecting their own assets (and the consequence of total financial ruin when they fail to do so), the overwhelming number of and size of scams, rug pulls, fraud, outright Ponzi schemes, and on and on and on… what exactly is left to keep anyone a “huge believer”?

Put differently, it’s been seventeen years of constant and escalating mayhem. What would finally be enough to shake your faith?

[cmcaleer]

> what exactly is left to keep anyone a “huge believer”?

I don't really engage in the ponzibucks part and don't touch exchanges except to on and off-ramp, and use crypto to pay for things like hosting, seedboxes, or other services I might not necessarily want my debit card directly attached to.

I like sending vendors $100 and spending $0.00005 in transaction fees and knowing that they'll get $100 (or $99 with some 3rd party integration like Coinbase Commerce) versus spending $100, of which Stripe gets $5 of and the vendor only sees ~$95 if I don't feel like I need the protections of a card, which is frequent but not all the time.

Crypto fits a niche in my life well, despite the wider crypto world having dumb controversies. Just like my HSBC bank account fits a niche well, despite HSBC's wikipedia page being ~50% controversy section by word count.

[joshstrange]

Your transfer fees are a bit off.

Coinbase is 10,200x more than you stated ($0.51 to send $100) BUT that’s only if I send directly on Coinbase. Coinbase Commerce takes 1% so it would actually be 20,000x more than you listed.

Stripe is 64% of what you stated ($3.20), and that’s with no processing fee discounts like you can get with higher volume.

Now, obviously, $3.20 > $1 but it’s not apples to apples. You can claw back your money with a card for one. there are many cases where I would prefer to pay the extra $2.20.

[FabHK]

Credit card interchange fees being ridiculously high is pretty much a US thing:

> In the United States, the fee averages approximately 2% of transaction value. In the EU, interchange fees are capped to 0.3% of the transaction for credit cards and to 0.2% for debit cards, while there is no cap for corporate cards.

Sensible regulation can make a big difference.

FWIW, I can pay bills by initiating a transfer both in HK and the EU instantaneously and for free.

Note also in your comparison of costs that most people still use fiat, and then pay the enormous fees of exchanges like Coinbase or Bybit that (for retail investors) are ridiculously high. So, a fiat-crypto-transfer-crypto-fiat round trip has another 2% or so on top (plus volatility).

https://en.wikipedia.org/wiki/Interchange_fee

[crazygringo]

It's also not even 2% in reality.

It goes to rewards which go straight back to the consumer.

My main credit card gives me 2% back on all purchases. In cash. Zero annual fee. And it's a card anyone with a normal credit score can get. Nothing special about it.

It really only makes sense to compare interchange fees after subtracting the proportion of them that get paid back to consumers.

[FabHK]

Sure, smart consumers can claw back some of that. But what you have then is merchants raising average prices, and consumers that use such credit cards being subsidized by those that don't.

[cmcaleer]

Solana is the main chain I use for these transfers, and it’s 0.000005 SOL * $170/SOL = $0.00085 to transfer any amount of USDC. so I was a little off there. My apologies for a $0.0008 error.

By the way, I specifically mentioned Coinbase commerce takes about a dollar: > $100 (or $99 with some 3rd party integration like Coinbase Commerce)

Stripe fees vary, but in a frequent case where a user is using an international card in a foreign currency it’ll very easily get close to 5%.

For me, yeah $2.2 is relatively immaterial. For a provider who’s doing $1MM in crypto transactions? Somehow I suspect that a few percentage points are quite meaningful, and I get the benefit of not having to explain what a seedbox is to my bank if they ever call me.

Again, crypto as a payment method is not for everything. But it’s quite nice to have the option.

[manquer]

> What would finally be enough to shake your faith?

Permanent and major market crashes is the only thing I can think of .

After the last crash a lot of fraud and incompetence got out because they couldn’t stay solvent, stuff like Celsius or FTX etc got exposed only because of the crash we had in 21/22.

It will take a few crashes, like that, until then scams or incompetence like this incident will not make people loose their money.

Few crashes, then most believers will loose their savings then the faith will shatter not until then.

Most people are after all investing in crypto because it goes up and not because they believe in decentralized currencies. As long as they hear how someone is making money on crypto they will keep believing no matter how many meme coins pull the rug, or exchanges fail or pig butchering or myriad of other scams come to light

[throwawayqqq11]

> what exactly is left to keep anyone a “huge believer”?

Bias. I expect believers to have earned a profit or still hold significant quantities of crypto assets.

But in their favor, trust in any currency is the foundation of its value. States create it by collecting taxes and paying employees. Crypto currencies generally lack that heavy weight central authority, so they kind of have to believe to the point where they get burned.

[dandanua]

> What would finally be enough to shake your faith?

Crypto scams run by top government officials? Oh, wait...

[LoganDark]

and the existence of financial scams isn't the same for fiat because...?

[stouset]

Have you seen the absurd lengths people have to go to to actually scam people out of significant sums of actual money?

It doesn’t even remotely compare and if you can’t acknowledge that, you’re willfully ignorant or a future mark yourself.

[LoganDark]

> Have you seen the absurd lengths people have to go to to actually scam people out of significant sums of actual money?

i've seen ponzi schemes and gift card scamming and those tend to make a decent amount, i'm not trying to say that crypto is not suck but just that money kind of is also suck, just buy gold, nobody's scamming you out of gold these days

[desumeku]

Maybe when it stops escalating and getting bigger and bigger and continually growing over time?

[ericjmorey]

Movement of funds from one sovereign nation's jurisdiction to another is important when one jurisdiction is in crisis or restricting capital flows.

[nprateem]

They've seen other people make loads of money (or maybe made a load themselves) and are still in the game hoping to make loads more.

[simpsond]

My faith would shake when scams, rugs, fraud, and ponzis completely stop outside of crypto.

[FabHK]

The "oh but there's crime in fiat" argument holds no water.

Sure, HSBC facilitated money laundering and drug trafficking in Mexico. And when it came out, the fiat response was a huge outcry and putting a stop to it.

The crypto response is to say "screw the laws, let's go all in with money laundering and drug trafficking".

It's like noticing that kitchen knives are occasionally used for murder, and then concluding that it's a good idea to sell machine guns at every corner.

Fiat is indispensable, and (due to regulation) better for legitimate purposes than for crime.

Crypto is entirely dispensable, and (due to its inherent limitations (inefficient, slow, cumbersome)) better for crime than legitimate purposes.

[simpsond]

Fiat currencies have collapsed in the past due to bad monetary policy (regulation is only good right?). Ask Argentinians how they feel about stablecoins after rapid inflation.

Alternative currencies offer competition and access. Why is that such a problem?

[stouset]

I’m not sure you want to go down the path of comparing the rate of total failure of fiat currencies vs. cryptocurrencies.

Yet another crypto collapse is in the news every week.

[desumeku]

Fiat is not indispensable, hello. Did you forget that human societies used to primarily have metallism-based economies before central banks managed to entrap the entire world in a system of debt slavery?

[FabHK]

Sure, and that gold standard failed. Fiat (with a money supply that can be discretionarily managed, and allows for monetary policy) is indispensable to a modern economy.

[desumeku]

It didn't "fail". It was gradually dismantled and replaced by a new economic order based on credit.

[EVa5I7bHFq9mnYK]

In 17 years, USD holders got hacked for 65% of their money (based on gold, or eggs, prices). At the same time, btc holders ... you know.

[stouset]

In 17 years, the value of my traditionally-invested assets (VTSAX) went up 700%.

I didn’t risk losing everything to scams. When I forgot my password my brokerage was able to restore my access. When I made a mistake in a transaction I was able to call them and sort it out.

Meanwhile, despite the incredible runup of BTC I know precisely zero Bitcoin billionaires. I know people who have theoretical fortunes on hard drives that have died. I know people who mistimed purchases and sales and who’ve perhaps turned a small profit. I know people who turned a large profit and then lost it all to malware or exchange failure.

So yeah, I do know what happened to the BTC holders.

[EVa5I7bHFq9mnYK]

You conveniently cherry-picked the low point after the 2008 crash as the starting point for your "went up" calculation. Had you started from the fund's inception in November 2000 and accounted for egg prices, the gain would be a more modest 39.4% over the 24.22-year period. Accounting for the price of gold, that would be a negative -14.7%.

And USD is in the much better shape than most other world fiat currencies, look at Zimbabwe, Argentina, Turkey or Russia.

The difference is that crypto hacks are rare, random and fixable (Bitcoin ETFs have the same brokerage protections), but fiat money hack is universal, systemic and legalized.

[JTyQZSnP3cQGa8B]

You like decentralized money without laws and accountability, but would like to have a central thing (TBD) that is accountable and respect laws? How would that work?

[zer0x4d]

I'm not too sure but few things come to mind:

1. Upgrade protocol to include protections for well known cold wallets held by exchanges (ex: API call has to be made to the exchange's security endpoint to validate each transaction out of the wallet. Exchange staff would need to manually allowlist large transactions before they are transmitted).

2. Decentralized voting on reversal of transactions (90-95%+ vote needed to reverse to avoid 51% attacks)

[jeswin]

This is getting pretty close to the banking system, at which point one needs to ask - maybe just improve existing protocols?

[j8k99kuyr]

> 2. Decentralized voting on reversal of transactions (90-95%+ vote needed to reverse to avoid 51% attacks)

Couldn't you technically just 'git checkout' a previous commit from before the fraudulent transaction occurred and pretend it never happened? Isn't the real problem that you'd have to convince a majority of users to do the same?

[ttyprintk]

The DAO experiment ended this way. Once an exploit started siphoning tokens to a new fund, that same exploit allowed anyone the same maneuver. Fixing an exploit is changing the rules, and the experiment would have ended in deadlock without it.

[killerstorm]

Ethereum is programmable, such a protocol can be implemented as a smart contract.

[rs186]

Not going to work, otherwise it would already have been done.

People who control or take advantage of cryptocurrency don't want this to happen.

[lucianbr]

Good luck getting 90% of a large group of people to vote the sky is blue.

[scyclow]

I think the move is less having a central thing and more advancing wallet and multisig technology. ByBit was pretty reckless by using a simple majority multisig to hold $1.5b. At that level you should probably have a few speed bumps. Like, maybe a majority of signatures allows you to make a proposal, but you can only accept the proposal after a couple hours, which would give you the chance to see the malicious transaction and bail on it.

Something like that would probably be overkill for individuals, but most people would definitely benefit from some added on chain bureaucracy regarding how their accounts are managed. And yes, for many this would lead to a system that isn't notably less centralized than the traditional banking system. But people would at least have a choice as to where their wallets gets to sit on the bureaucracy <> complete freedom spectrum. And even if they end up closer to the bureaucracy end, they'd have a lot more flexibility and lower administrative fees than what they currently have.

[otabdeveloper4]

> let's reinvent the banking system except worse in every way

[silisili]

Right on. My bank calls me every time I send money out. And I'm talking like $50. I used to find it annoying, but now I'm blown away every financial system doesn't...

[cmcaleer]

On the one hand, I understand banks attempting to protect customers and limit liability, on the other hand, frankly I have better things to do with my time than spend 30 minutes waiting in a phone queue because I had the audacity to go on holiday and attempt to spend $20 on ice cream.

[nilamo]

Those all sound like stated objectives of crypto.

[j8k99kuyr]

Code is law, no?

[JamesLefrere]

Solutions have existed for years (eg Gnosis Safe), they just aren’t being used by that exchange.

[mhmmmmmm]

Bybit was quite literally using Gnosis Safe for the compromised wallet.

[zer0x4d]

I can't believe someone posted that without knowing they actually used Gnosis Safe

[JamesLefrere]

Believe it, baby

[JamesLefrere]

lol. Good times.

[jgilias]

Can’t tell if you’re trolling here or not, but good one either way!