[titanomachy]

> At no point in this pipeline does Mike's capital touch productive enterprise.

This is an interesting economic/philosophical angle. What is the logical conclusion of this? What happens as a higher fraction of people deploy their capital in zero-sum games? Is "deployment" even the right framing? A bet doesn't necessarily "tie up" capital in the same way as a real investment (you could place your bet moments before it's settled). Buying crypto does tie up capital, sort of, although in theory you could invest crypto-denominated assets into something productive.

My capital is in real estate and (mostly US tech) company equity. Is society actually better off because I put my capital there instead of letting it sit in a bank account or crypto wallet?

[blenklo]

Buying crypto actually 'doubles' money by increasing risk:

You buy crypto and give out fiat. Now you have apparently 1 crypto worth 1 fiat and someone else now has 1 fiat.

[ForHackernews]

The logical conclusion is it should be taxed as gambling, not investing. Some countries like India have already gotten this one right.