First, I have never actually seen any comments here disavowing themselves of responsibility. It is always aimed at protecting others and this is rooted in the obvious fact that a very large number of people are not (and we do not expect them to be) experts in investment. That assets can go up or down is one thing, and nobody can be protected from that, but there is an extensive body of law intended to protect people from outright falsehoods. So I can say, "you should invest in ConCoin, it's going to the moooon" and that maybe is allowed. I cannot say "we have pegged this to the value of the dollar if I know that I have taken no care whatsoever to even try and do that".
Second, refusing to set a floor on falsehoods using regulatory tools makes doing business much more expensive for people who are not scammers. This is a classic "market for lemons" effect. If I have a great idea that I would like to raise money for using, say, a utility token [n.b. not currently allowed] then if the last few such tokens have been exit scams, I will raise no money. Maintaining a certain level of trust is a pool from which we can all draw. It has in fact been shown that growth in low trust economies is systematically lower than in high trust economies.
So then they should stay out of the game. I totally disagree that we need a bunch of bullshit laws protecting people from poor decision making.
Demand side already has responsibility and correct incentives: the fools have been parted from their money. Done.
This goes for small things, like NFT ponzis, and big things, like turning housing into an asset class.
When has housing ever not been an asset class?
Real estate is and was the original asset class.
Within the western world, that has always been the primary basis of one’s wealth until fairly recently.
I think the issue is assuming people who get scammed are at fault for something, just because a more paranoid person would have avoided the scam.
Regulation will not stop me from selling a potato for $100. it will stop me from selling a regular potato for $100 while claiming it cures cancer.
Buying a potato for $100 would be dumb, and nothing stops me from doing it
Buying a cancer-curing potato for $100 is not dumb. Believing a potato can cure cancer because someone else is publicly selling it to me that way in full view of the entire world is not dumb. I would think "oh wow, something about this potato must be cancer-curing because surely this guy knows that if he scams me in front of the public then the public will hold him accountable."
So it is now time to hold people accountable
Basically, it's exactly that.
Now one can be informed but also choose to make stupid decisions. People do this all the time on penny stocks, options, etc... The SEC has no interest in trying to stop them, just making sure they know up from what they are getting into.
Other than that, lies and manipulation are part of the equation. It's a bad decision to blindly trust anyone or anything. You can't separate smelling bs from judgement.
The whole concept of an accredited investor is basically saving people from themselves.
The SEC has a pretty ill defined set of risks they are trying to protect people from. People will find ways to lose their money if they don't have a general "wait, do I have a clue what I'm doing here?" filter.
I agree with personal responsibility but not at the expense of communication.
Imagine if every single person who moved a package was required to open the package and confirm the contents. It may be the only way to accept personal responsibility for its contents, but it's dumb. I am telling you what the contents are and if I am lying to you then I need to be held accountable. Especially if the contents are dangerous and I told you they are safe.
If I write "i owe you a billion dollars for your 64 diamonds" on a minecraft sign you shouldn't be surprised if I don't hold up my end of that.
The more a community holds itself accountable without regulation, the less regulation the community needs. If people always avoided unregulated assets because of your logic - we wouldnt have any regulated markets today.
Non-scams are the norm where I come from and with the people I interact with. Maybe it is cultural. Some cultures held people accountable for their bullshit and some didnt... and now the expectations for responsibility are different. "you should expect to get scammed" vs "if you find a scammer we will deal with them"
>If I write "i owe you a billion dollars for your 64 diamonds" on a minecraft sign you shouldn't be surprised if I don't hold up my end of that.
If you take my 64 diamonds, deny me a billion dollars, and then refuse to give the 64 diamonds back.. that is theft. In minecraft, I would then proceed to remove your health bar, take what I want from you, pour lava buckets on your house, etc. And you should not be surprised by that.
Abusing a lack of regulation causes chaos, and hinders the ability of communities to grow stronger. Weak communities enable unnecessary suffering. There is an ethical responsibility to make an example out of people who manipulate communication to scam others. It is one of the few things nature allowed us to have to enable building communities in the first place.
If scamming is currently the norm, then it is currently hunting season.
I mentioned it to another, but have some humanity and empathy for those less "smart" than yourself.
You're still thinking of it as something people can learn, but psychology / history says otherwise.
This is why I say empathy is important. For you, it's obvious. For others, it's not.
In addition, there are other factors at play, like desperation (when you're living paycheck to paycheck, you _want_ to believe there's a way out).
Everyone has different experiences / situations to grapple with, and as a society we should try to help folks find the happy path and protect them. Especially so for those of us who recognize cons!
So I guess I wouldn't understand the "empathy goes both way" statement.
Your points are certainly valid. I don't think either way results in something perfect or even that good.
The "get rich quick" folks are doing basically the same thing but faster and sometimes with less sense. But hopefully with only a small portion of their savings.
Trusting such claims without proof is stupid/financial illiteracy/YOLO investing (pick your preferred term).
Pulling from the comment I was replying to:
> ... many poorer and financially illeterate people have been tricked ...
That's quite literally disavowing responsibility.
> ... but there is an extensive body of law intended to protect people from outright falsehoods
This is true and the law hasn't quite caught up to crypto scams but think about it this way: even if the scammers get prosecuted--possibly even go to jail--you're 99% likely never getting your money back. And even if you do it'll probably be after wasting years on the effort. Obviously there's a deterrence value to prosecuting scammers and I support that hpappening but you'll almost never get your money back.
> Maintaining a certain level of trust is a pool from which we can all draw. It has in fact been shown that growth in low trust economies is systematically lower than in high trust economies.
I 100% agree and this is something that libertarians and anarchists gloss over completely.
Unsure how you failed to read the emphasis on "themselves" in the comment you're replying to, and the line about protecting others.
Half of this thread believes we should protect people from themselves.
The other half believes people should have the freedom to screw themselves over.
Not sure there's much ground for compromise, given the contradictory nature of those positions.
> The other half believes people should have the freedom to screw themselves over.
Nailed it. It comes down to principles. Do you believe in personal freedom? Or do you prefer authoritarian governments?
If I buy edible stuff I trust that it won't poison me or kill me. If I drive a car I expect it respond to my commands and I expect other drivers to have a minimum amount of knowledge that they can actually assume and understand the risks of driving.
The protections that the SEC and other bodies expect in this area are quite reasonable if you understand that there is no such thing as "personal" freedom; your well-being and successes and failures tie into the rest of society at large. Maybe if you lose part of your savings that might be tolerable for all, but if in the process of making a bad investment you leave yourself and your family homeless, get into drug addiction, and create a large burden to those around you, it's hard to consider that to be a simple personal issue.
Look, if someone comes to my house claiming to be raising money for charity and I givethem money, the following statements can all be simultaneously true:
1. I should take responsibility for checking that they represent a genuine charity;
2. If they are a genuine charity, I should take responsibility for checking that most of my gift will go towards the recipients of the charity and not to operating the charity itself;
3. They should take responsibility for being truthful about who they represent and where the money is going.
Responsibility isn't a zero-sum game. We can encourage everyone to have more financial literacy and awareness of scams and frauds while simultaneously holding grifters responsible for their crimes.
I'm not taking either position here, I'm taking both positions. See also "the difference between advice for individuals and codes of conduct for communities."
Our personal advice is to protect yourself from fraud. Our society's code of conduct is, "don't commit fraud."
The point of prosecuting scammers is not restorative justice[0], but instead punative. You want the penalty for scamming people to be high enough that even the scammers that don't get caught move onto a different grift.
Whether or not punative justice works is very context-sensitive. It requires the crime itself to be something done because it makes money - opportunistic crimes or crimes of passion will not be deterred by high punishments[1]. However, I absolutely do buy the idea that scammers are highly-calculating thieves that can be deterred in this way. They operate highly organized criminal enterprises with their own internal and external security concerns, and respond highly to perceived risk of prosecution[2]. This is why they like to target old people, the marks are easier to scam and less likely to admit being scammed.
That's not to say that we should fall back upon the "personal responsibility" angle, either. It's easy enough to say that it only happens to the financially illiterate, or the elderly, or what have you. This is wrong; there are plenty of scammers out there just waiting to push whatever button you have that will make you send them money. The problem with pushing "personal responsibility" as an angle is that it's a victim-blaming narrative, and one that makes it easy to fancy yourself invulnerable. "I can't get scammed, because I took personal responsibility."
DO NOT DO THIS.
You will laugh at the people who bought into FOMOCoin or sent thousands of dollars to a refund scammer... only to click on, say, a fake FedEx tracking link you got e-mailed and wind up getting hit with some 0day malware that drains your bank account or encrypts your files in seconds. Personal responsibility will not save you from your own sense of invulnerability, because there is no level of responsibility one can take that will ensure that you never, ever get scammed. You can only ever make yourself a less desirable mark.
[0] i.e. putting the thing you stole back
[1] Related note: governments love to insist upon high punishments for crimes more often committed by people on the margins of society (e.g. poor/black/Mexican/some other power minority). At one point, we at least punished businesses the same way, but then Enron happened and the US decided killing an entire accounting firm just to prove a point was going too far.
[2] In one revealing case, Youtuber Mark Rober was able to shut down an entire tech support scammer group on Telegram by merely saying he had their dox[3] and was planning to drop them on a few law-enforcement agencies.
[3] 4chan slang for "personally-identifying information".
Terrible comparison.
FOMOCoin is not pretending to be something different than FOMOCoin. When somebody invests in a shitcoin, they know exactly what it is they are investing in.
When you click on a fake FedEx link, you believe you're clicking on a FedEx link. You've been deceived by blatant deception.
A better comparison to your FedEx example: Investor believes they're investing in FOMOCoin when in fact they are investing in SHITCoin or no coin at all. It was a trick.
I assure you, libertarians and anarchists, or at least the ones who have actually bothered to go beyond the surface, are not unaware of this. You're wielding those monikers as if anyone to bear them would be a fool by definition. It is clear low trust has adverse effects on growth. What is not clear is that unbounded rapid growth is a desirable state of affairs, or that an equilibrium is so important everyone must bow before a central authority/planner with a hand on a brake.
There is nuance your comment as written completely neglects.
Not as far off as you might think
But it’s unfalsifiable gibberish itself to believe our system is some pinnacle of human society
Many problems that plague states that lean into socialism can be traced to capitalists meddling in their affairs through international politics
More rules for thee not for me policy by nations of people who would meltdown over externalized forces dictating their way life. Hardly proof in a vacuum socialism is a sign of the end times when it’s held up apes who can’t communicate except by throwing poop
Your truth is rooted in the empowerment it provides you. No one else has an obligation to your figurative sense of power
Is it the casino foult that their customers loose money because the ambient is so inviting and screams wining?
Casinos are very strictly regulated and must post the exact rules and probability of winning for all their games. If the casino lies about the rules of the game or your chances of winning, then yes it is absolutely their fault and they will be held liable.
I'm pretty sure if I followed the Superbowl ads to crypto.com, I would fail to see these warnings.
Yes, for everyone deeply connected online, who has been following crypto for the last several years, of course we've talked about plenty of warnings many times. But the current marketing campaigns are not aimed at such people.
And yes you could be right it’s just my bubble. But it’s still sad that so many people fall for get rich quick scheme.
Clearly not. There's a pretty clear pattern where many (most?) cryptocurrency enthusiasts avert their eyes from anything except the most transient and limited downsides and are can be quite hostile to anyone who's bearish on cryptocurrency. It's got a strong "power of positive thinking" vibe.
Saying you can't believe people didn't know is just showing lack of empathy in how others form trust. Many of those people form trust by looking at a screen and seeing a nice website with nice logins and nice charts. They look at things with dollar signs and say, "that's a good number there". Others dig in and are curious about how things work. Some laugh when people complain about how much power proof-of-work takes and believe it is the eniventible conclusion to why we don't see aliens out there.
Don't be the wurst person. Be the best! See that all humans need our help from an understanding technology perspective. Know that software can be implemented to take away their choices, or give them more choices than they had before.
Are you suggesting that every Casino publishes an AI derived win rate for poker by law?
I still wouldn't call it perfect play because as soon as someone adopts a fixed strategy, the meta game shifts and it is no longer optimal.
If anything, the assumption is equal play, not perfect play
The meta idea is what I first thought. It’s hard to evaluate though. The ai does not adapt, but continues to beat pros, who are welcome to try and adapt.
I’m curious if there are some zany cheese strats against this kind of AI that work reliably but the answer may be no. The only really practical tool you have that could work is a crazy bluff, but I doubt that’s sustainable.
It doesn’t really matter if perfect play is considered though. Games should be rated assuming equal competence. It’s not misleading if in fact your turn out to be a worse player in a game of skill.
My point is that if the casinos have to post odds, the only odds on a poker table are flat (any deviations from 0 coming from skill differences) minus any rake (with maybe some slight variation if the button doesn't go down an even number of times).
The fact that we cannot define perfect play is irrelevant.
But there's always that separate question of whether it's a moral failing to set out to do what they did in the first place.
And then you dig a little deeper and you can ask, even if we grant for the sake of argument that it's a moral failing, is it the state's responsibility to do anything about that?
And then you can dig even deeper, maybe ease off on the deontological ethics a bit, and instead ask, "What's worse for society in the long run: this behavior, or whatever enforcement mechanisms it would take to curb it?" I'd argue that that's a much more edifying way to frame the question.
My morals don't personally draw that line but it's common enough that you can't dismiss it as preposterous.
Amen to this. Too many people in this thread are shouting from the mountain tops that they hate freedom.
If you can't handle climbing a mountain, you shouldn't do it. It's really this simple. If somebody takes on risk and gets hurt it is their own fault.
Since “customers losing money” is the entire business model and what casinos work to optimize, yes, obviously.
I believe that everyone should do their own research etc but there's a reason there are laws against fraud. There are a lot of people who would get taken advantage of by the unscrupulous if we just decided that it's all about personal responsibility. Yes people should not have the expectation that they will get rich quick but there is also no reason to allow them to be blatantly ripped off either.
If tether haven't maintained the level of reserves they need to maintain the peg (and honestly I can't see how the possibly could have adequate reserves) then it seems a pretty straightforward case of fraud.
Not even close, even now. And the earlier stuff was almost insulting. Like the claim in 2019 that they were depositing $3.5 BILLION, per WEEK, into a bank, a deposit rate that would exceed AT&T, Samsung, Alphabet (Google).
Hah. No. The bank "deputy CEO" (who was 33) in an interview noted that the Bahamas had two banking licenses. But couldn't name them. And in any case, wasn't sure which his bank had, but he knew they had one of them. "And possibly the other".
Now that's the actual con, or at least a pipe dream. Hard work is never enough.
Luck plays a huge factor but few who get lucky, and then rich, will ever admit to that part.
This seems like a bad faith, intentional misunderstanding of the concept of hard work. You're right, mindless hard work (with no proactive consideration for your own life trajectory) is not enough to "make it". If you take the first minimum wage job you find and you work hard at that job for 40 years, you're not going to make it. That doesn't invalidate the American Dream. The American Dream isn't "if you work hard, the American Dream fairy will appear and present you with a house, a car and a white picket fence", it's "if you work hard at making it, you can quite easily make it". This presupposes that a given worker will take responsibility for their ability to earn, and be willing to course correct if they are not on a good path toward "making it".
> Luck plays a huge factor but few who get lucky, and then rich, will ever admit to that part.
Nonsense. The goal of the American Dream was never to be Jeff Bezos. It was to live a comfortable life. In that sense, the American Dream is being realized by the vast majority of Americans every day. The median income of a middle-class household in this country is 78K,[0] which puts them in the ~94th percentile in global income.[1]
[0]https://www.pewresearch.org/fact-tank/2018/09/06/the-america... [1]https://www.washingtonpost.com/graphics/2018/business/global...
I am not implying it is all luck, but there is never no luck involved in success.
If uou're going to make a historical argument, please follow through.
Now everyone are just 'temporarily impoverished billionaires', which is why the whole scam continues to hold itself up.
The Steinbeck that your are (mis)quoting is from the 30's. Misquote because Steinbeck was talking about how the majority of the ""socialists"" at the time were "most of the so-called Communists I met were middle-class, middle-aged people playing a game of dreams. I remember a woman in easy circumstances saying to another even more affluent: 'After the revolution even we will have more, won't we, dear?'"
So the feeling of entitlement is much older and across political lines.
Hence, thanks, but looking back to the 30's isn't relevant here.
If I openly leave a gold bar in the back seat of my car and don't lock the car and then park it in a major city it will get stolen. Is the thief to blame here? Absolutely. Could I have done more to protect my valuables? Absolutely.
So with any scam, you can say the scammers are bad (which is true) but the scammed could also have done more to protect themselves. Both of these things can be true at the same time.
I've seen no better example of this than Russia's unjustifiable invasion of Ukraine. Is Russia the bad guy? Absolutely. Have the US (through NATO, primarily) and Ukraine made mistakes along the way too? Absolutely. Does this make the US and Ukraine responsible for the invasion? No.
Please, for your own sake, get out of this binary thinking.
Disavowing responsibility from the scammed actually does people a huge disservice. It's not victim-blaming. It's a teachable moment.
E.g. instead of having a never-ending discussion on how exactly a perpetrator/victim share blame, we can shelve the discussion on what share of the blame goes towards the victim, and instead focus on how to best deal with the scammers.
If we get trapped in a never-ending discussion on blame sharing, we never get to deal with the scammers through action (this is what I meant by muddying the waters, it’s an involuntary and voluntary phenomenon that can delay action indefinitely).
People just don't go around handing out money. Early Bitcoin miners went through the effort of setting up mining rigs (which is no longer practical for an individual). They actually did something, and had some skin in the game. Did they hang on to those early coins until this year? I have no idea.
But people that just buy into coins because OMG its the next big thing, are purely speculating, which is nothing more than a form of gambling. Do I feel sorry for people with a gambling addiction? Yes I do, and I know someone that 'retired early (35)' to play poker professionally.
To much of the coin and NFT space to me smells of a combination of pyramid scheme and MLM. By its very nature it rejects regulation, it is decentralized. Which is one of the reasons, to me, that it is suspect.
Playing poker professionally is not a retirement, and no one really playing poker for income is addicted, I can assure you (at least not for long).
These days, playing live is the only way to get an edge (correct me? Been a while), and that would be a boring, nauseating job, right around the pay scale and routine of “club bouncer” if you’re good.
I played poker for my sole income for three years after college, traveling the world playing online. It was occasionally a lot of fun, morally painful, so stressful and not very well compensated. I would be rich now if I’d gone straight into programming instead of spending my 20s “avoiding work” by working my ass off to monetize my hobbies.
At peak covid, all the games dried up and even the pros went slumming. I personally saw Phil Ivey at a 2/5 game (!) at the Aria on a random Monday because that was the only game going and he hadn’t had any live practice in quite a long time.
If social was full of people showing off all the stiff they bought with the Nigerian Prince’s money maybe. Seems more like a lottery to me, but even that feels like a poor analogy.
The difference is crypto has made people wealthy, probably with a large luck component and others want in on that.
Grifters should be punished for their scams, and it's also acceptable for "investors" on these scams to lose their money i think (that's a hard punishment already; no need for anything extra). Thinking of it the other way around: as a society, it wouldn't be nice to bail out or compensate these "investments", as doing so would encourage people to keep doing throwing their money on things they don't have any clue about and expect to be compensated if it turns out bad.
You're missing the point. When somebody makes a poor decision on an investment, they are not a "victim".
One of the ways that a power structure discriminates against low-IQ people (born that way) is by ignoring their suffering because ‘they deserve it for being stupid/easily taken advantage of.’
Insurance agencies are wrestling with this because as society ages, there are known drops in IQ the make the elderly more susceptible to scams, because low-IQ behavior correlates with high-trust behavior (because they have to rely more on others for survival). Some agencies are offering scam insurance for the elderly.
As we age, the likelihood that we are scammed approaches 1. Scammers take advantage of this situation and society would be better off if scammers were taken care of by the state.
1. Anyone can invest all they want in a diversified portfolio of approved investments (non-penny-stock public companies, mutual funds and exchange-traded funds with modest fees, insured bank accounts, etc.).
2. Anyone can also invest in any other dumb investment; you just have to go to the local office of the SEC and get a Certificate of Dumb Investment. (Anyone who sells dumb non-approved investments without requiring this certificate from buyers goes to prison.)
3. To get that certificate, you sign a form. The form is one page with a lot of white space. It says in very large letters: “I want to buy a dumb investment. I understand that the person selling it will almost certainly steal all my money, and that I would almost certainly be better off just buying index funds, but I want to do this dumb thing anyway. I agree that I will never, under any circumstances, complain to anyone when this investment inevitably goes wrong. I understand that violating this agreement is a felony.”
4. Then you take the form to an SEC employee, who slaps you hard across the face and says “really???” And if you reply “yes really” then she gives you the certificate.
5. Then you bring the certificate to the seller and you can buy whatever dumb thing he is selling.
6. If an article ever appears in the Wall Street Journal in which you (or your lawyer) are quoted saying that you were just a simple dentist, didn’t understand what you were buying and were swindled by the seller’s flashy sales pitch, then you go to prison.
It's easy to say "they should have known" better because in absolutist terms it's correct. But you're focusing on the 'what' and not the 'why'.
For example: https://rollcall.com/2021/09/07/left-behind-by-financial-sys...
"Normal" investing is complicated, and stacked against regular people. Now we're asking people to understand blockchain and cryptography as well as investing. Yet it's sold as democratisation of investing. I mean, seriously.
You buy a low-cost index fund (either S&P 500 or total market (Russell 3000, Wilshire 5000)), and depending on your risk tolerance, a bond fund as well.
You can have global diversification with one ETF or mutual fund:
* https://www.youngandthrifty.ca/picking-the-best-all-in-one-e...
You just delegated the choice of winners and losers in your economy to an elite cadre of individuals, completely disconnected from boots on the ground life problems.
Symptoms of your decision may include:
Tendency to centralize.
Preferrntial treatment of large incumbents for ease of implementing regulations.
Higher barriers to entry over time.
Decreased feedback loop with regards to reigning in egregious business malbehavior.
Index investing does nothing but perpetuate a small handful of winners, and divests the majority of people from their most important role of being capital allocators.
Part of it, is being bad at it at some point. That's how you get better and increase overall world awareness.
Buy a broad based, low cost index fund. What exactly is complicated about that?
> and stacked against regular people.
How so?
Something about the chance of life changing returns in intoxicating. Personally I'd be thrilled with a 20% annual return in "normal" investments, but somehow crypto doubling or even tripling in a year is boring because we're all after the 100x+ return. Maybe it's because psychologically it just feels like more of a lottery ticket.
I have a relative in wealth management and went through a period where clients asked about bitcoin frequently. He told me his rule of thumb is: "If you've heard of it, it's probably already too late."
Which leads me to an idea: classify crypto as a casino.
But only bitcoin bidders need to admit that they love lording their “smarts” over others? Seems like you are doing it yourself.
AFAIK, the original American Dream was getting rich through smart work and entrepreneurship.
Not winning the lottery.
What is the 1% you think aren't scams?
Or perhaps every single one has a core of 1% sincere intention at its heart. After all, you can rather confidently say you have a receipt.
Money laundering. The one use case where NFTs are actually effective.
Holy projection batman. I agree that much of crypto is rampant speculation, but pretty much all of the legitimate uses of crypto is done in stable coins. People don't have money sitting in tether because they wanted to get rich.
People saw the meteoric rise of Bitcoin and got a serious case of FOMO. Everyone wanted to be on the next Bitcoin. This, ultimately, is the American Dream: to get rich by doing nothing other than getting lucky and being able to say how smart you are. Not by creating any kind of value.
People should be honest and admit (at least to themselves) that they didn't understand what they were investing in let alone believe in it fundamentally. They just wanted to get rich.