What’s the reason for you thinking it’s an enormous grift? I ask as someone who has read enough to feel it is useful and have a hard wallet with some bitcoin (well not a full bitcoin) but I am not into it enough to do anything stupid or evangelize it to others. So, you feeling the whole thing is a grift, I would really like to know if I’m missing something.

It's been in vogue for a couple months. The meta issue is that it lost a ton of value as a store. But so did many many stocks. Idk percentage wise how many companies lost a greater percent of their stock value than Bitcoin has in the past year, but we don't call them grifts. I think digital assets and coins are a pretty neat technology, much of the last bubble was solutions looking for problems. But it's how it goes.

> Idk percentage wise how many companies lost a greater percent of their stock value than Bitcoin has in the past year, but we don't call them grifts.

Companies generally do other things besides being a vehicle for speculation.

I mean, so do digital assets. There is plenty of bullshit out there, but when Nikola had a market cap of 14 billion based on someone pushing a hollowed out semi truck down a hill, is that radically different?

I don't see it as radically different. And Nikola still has a market cap of 1 billion. The idea of digital assets, of trustless contracts, its still very very interesting to me. That a bubble formed and popped is more of a 'well of course it would' result to me than something to be feared.

And maybe someday Nikola solves the truck thing and dominates shipping. I don't know.

I think they whining about coins being a vehicle for speculation is puritanical hand wringing. Especially when it comes from the left and is focused on how people, who were quite literally engaged in speculation, lost money.

It has almost no usage as a money transfer system, but it has essentially replaced all other forms of get-rich-quick schemes peddled on retail investors.

Last week I was in a developing country. The amount of crypto-related advertising was striking. And none of it was about remittances. These ads were not saying “Here’s something better than Western Union.” No, they were showing trading screens on a mobile app with shitcoins going to the moon.

I believe Western crypto enthusiasts are badly in denial about the volume seen on third world exchanges. The people putting their nairas or liras or whatever into crypto are not doing so because they think it’s a great system to send money internationally and because they don’t believe in central banks. They’re only doing it because a local influencer on YouTube told them it’s how you get rich.

(Of course everybody in the West buys crypto for that same reason — maybe the source of the “insider tips” is more often Twitter, but the motivation is the same. The important point is that third world crypto adoption is a core narrative told by crypto pumpers, and it doesn’t exist any more than first world crypto adoption.)

They aren't badly in denial. They KNOW exactly how grifty the whole thing is. They KNOW that things like mpesa and similar exist in a lot of the supposedly developing world, and that the US banking infrastructure being stupid is more a matter of lacking policy than lacking technology. They KNOW that stupid "play to earn" game only really gave a few thousand people in the Philippines an income, while thousands and thousands more spent hundreds of real dollars to buy in and play and spend over ten hours a day "playing" a "game" that is closer to a slot machine than anything else. They KNOW that concept was no different to trying to earn a living by buying, opening, and selling CS:GO cases.

They don't care, or ignore these things, because eventually everyone figures out that there's not much to do with or for crypto that isn't scamming someone out of money or providing a vague crypto adjacent service. Nobody wants to buy regular products with crypto because for normal people, it is a pain in the ass to participate in crypto without getting scammed, and for crypto diehards, they know any dollar spent in the crypto ecosystem is inefficient because they are often purposely deflationary assets. They know that they spent a shitload of their savings on shitcoins, and that if the crypto world continues to struggle, that's an existential threat to them. They know that people NEED to buy in so that the price can go back up so they can cash out and save themselves. It's no different from desperate people in an MLM getting pushy with their facebook friends because they have $2000 in credit card debt buying Dotera product to stay "in their tier" or whatever nonsense the particular MLM uses, and the only way to get money back out of it is to become a conman.

The reason why it is an enormous grift is that Bitcoin has failed in its original aim to be used as a means of payment. It is completely slow, volatile and the majority of people use it speculate on exchanges.

The current price of Bitcoin is pumped up by Tether and it is only a matter of time till the entire thing crashes down.

For comparison, UPI achieved its aim of fast payments in India MUCH quicker than Bitcoin ever did in it's nearly 15 years of its existence and now UPI is expanding.

Because it's not pragmatically useful, and the speculative nature of it attracts enormous amount of grifty/spammy types of money and people. There is a reason most of it offshore, there is a total lack of transparency etc..

> Russian national who resides in Shenzhen, People’s Republic of China

> arrested last night in Miami

Arrested while traveling in the US?

US is a funny place, you can't transfer from one international flight to another without entering the country.

So flying from UK to Mexico with a stop in Miami will involve immigration and all the jazz in Miami (including the need for a visa if your passport normally requires it).

This is usually not the case in Europe. You stay in the non-schengen transfer zone and walk from one gate to another.

Even without formal immigration controls for transfer passengers I'm sure the European authorities are quite capable of consulting the flight manifests and arresting you in transit if they desire.

And if ETIAS ever goes live, they’ll be pre-clearing just about everyone before they get on the plane.

Much of Coinbase’s operations are located in Miami. If I recall correctly, this individual has been residing in Miami for ~ a year….

I’d like to see this technological scourge wiped out.

you'd like to see consensus algorithms wiped out?

https://appinventiv.com/blog/blockchain-consensus-algorithms...

That’s like saying:

“Oh, you think multi-level marketing shouldn’t exist? It’s a form of storytelling so apparently you want to destroy all stories, you mean old culture-hater and book-burner.”

Also, do cryptobros really believe they invented consensus algorithms as a concept?

Academics have a lot of positive things to say about crypto research.[1],[2],[3]

[1]: https://www.youtube.com/watch?v=EfsSV7ni2ZM [2]: https://techcrunch.com/2022/04/21/a16z-debuts-new-crypto-res... [3]: https://cs251.stanford.edu

Academics are generally extremely happy to get paid.

The one thing academics are known for is not getting paid very well at all. Especially in computing fields.

Some of them seem to believe they invented _cryptography_, so, well, probably. I've seen crypto people genuinely convinced that it is impossible to sign something without the Almighty Blockchain providing its blessing.

It's used because it solves a problem: 'trustless' transfer of value (in that you trust the network and not a centralized authority). It's 'big' because people who don't have this problem speculate on Crypto, even if they don't need trustless transfer of value.

How else would I pay a cybercriminal without Crypto? I ask this in good faith, I genuinely don't know of any other methods. Unfortunately the current method uses lots of resources, which I'm guessing is why you hate it so much. I'm all for better alternatives, but what are they?

How big is the 'trustless' part of the ecosystem? 5%? 1%? Most of the speculation happens on centralized exchanges which very much involves (completely unjustified) trust.

For bitcoin, this site suggests ~90% (2 million bitcoin on exchanges vs 20 million in circulation)

https://www.coinglass.com/Balance

Wikipedia tells me there are in fact a hair under 19 million Bitcoin minted. I am willing to believe this site is getting the large exchange component right, or at least conservatively right (conservative in that it's unlikely to be claiming coins that don't exist, but it's possible exchanges have additional coins not listed, and it's possible there are other exchanges not listed).

Googling, it seems that the best estimates seem to indicate between 2 and 4 million Bitcoin are permanently lost (lost keys, known hardware failures of failed wallets, unclear if this counts Satoshi's million bitcoins or not). This estimate [0] by an analysis firm who appears to be broadly pro-crypto suggests 3 million lost, and that ~14.5 million BTC are "illiquid". Illiquid obviously doesn't mean lost

Illiquid doesn't mean lost, but it suggests something to me about the current conversation. If only ~4.5 million BTC are even a little bit liquid, then it's fair to say that at least half the engagement with BTC in balance terms is on exchanges, and probably more considering velocity of money. Not the grandparent's claim of 99%, but also not your claim of 10%. At the very least, not an obviously settled question.

[0] https://insights.glassnode.com/bitcoin-liquid-supply/

It isn't just the problem of paying for illicit goods/services. I was paid (for perfectly legal work) in crypto earlier today. In many perfectly legitimate cases, there's substantially less friction involved when compared to established methods. I didn't have to muck around with archaic systems and bad UX or provide endless information, and I like that the whole affair is so conceptually simple as opposed to the black box that is the backend of my bank account.

"How else would I pay a cybercriminal without Crypto". Does paying a criminal also makes you a criminal? Would using cash be an option?

Exactly. It’s like the folks who say these things don’t understand they are defending criminal activity. Now, one can argue things like the sale of “illegal drugs” shouldn’t be illegal in the first place, but that’s an advocacy issue not solved by decentralized payments. All you do with decentralized payments is make it exponentially more efficient to engage profitably in illegal activity. Not exactly ideal given much of what constitutes illegal activity is well deserved to be outlawed (sex trafficking, murder for hire, etc…)

How about decriminalized drugs? There's also still on-going issues with getting bank accounts if you're handling decriminalized drugs like marijuana. There was even an attempt to pass a law that specifically for this in the United States (SAFE Banking Act) that is faltering.

Without a bank account, it's near impossible to accept credit card or any other alternative. You can pretty much only accept cash. And since you can't just deposit it into a bank account, retail has to pay growers (and employees and withhold taxes) in cash, and they have to find agricultural equipment suppliers who will accept cash. And in my experience, even they can get their bank accounts shutdown just for being in an adjacent industry and handling too much cash.

I’m not defending criminal activity. I’m being a realist and recognising it exists, and thus there is a logical reason for the existence of crypto. It’s all well and good to say the solution is to not break laws, but that is not how the world works. It’s like saying the solution to lung cancer is for people to stop smoking, it’s absurd.

> How else would I pay a cybercriminal without Crypto?

You don’t. That is the point of laws.

In good faith, the commenter specifically mentions the DoJ. People want laws against cybercriminality because it hurts them. Your argument is similar to answering “I hope AR-15 rifles get abolished” with “well, how else can I do a mass shooting?”

Illegal doesn't necessary mean that something is morally wrong. I'm all for making ransomware actors life harder, but it should not come at the cost of also affecting regular drug buyers/sellers.

And similarly, you will find many people arguing that AR-15 are morally good to own even if they are banned.

Laws are not about morality as much as effect; but people still want them applied.

>How else would I pay a cybercriminal without Crypto?

Gift cards?

The alternative are systems like:

UPI (India)

Pix (Brazil)

PromptPay (Thailand)

PayNow (Singapore)

Which works infinitely better than crypto.

These look like centralized systems, which require trust. Am I missing something?

These systems have proven to work better than what we have now with crypto which is full of unregulated, volatile fictitious tokens that attract offshore exchanges.

Funny how developing countries have come up with better solutions that what crypto was trying to solve for them in payments but failed in doing just that.

You are confused about the value proposition of crypto. These systems do not solve the same problem.

There is no value proposition of crypto and my point still stands.

What has crypto done better than the systems I have mentioned?

I’m not going to repeat my explanation from my parent comment. The fact that you can’t form a rebuttal shows that you do not understand the value proposition. I suggest reading the original bitcoin white paper. If you can understand it then the differences with the systems you mentioned will become obvious.

> You are confused about the value proposition of crypto.

Then you should tell us what is the real value proposition of crypto then, because I cannot see it.

The Bitcoin whitepaper is moot since the whole point of Bitcoin is to be a P2P payments system and yet it has failed in that aim alone.

Therefore, since Bitcoin in its current form has failed, the value of crypto is nothing.

"How else would I pay a cybercriminal without Crypto?"

Before cryptocurrency became widespread, they were limited to gift cards and MoneyPaks, which kept the ransoms to the several hundred dollar level, and therefore to the "oops, clicked on a dodgy site," individual PC level, rather than the finely targeted attacks on organizations able and often willing to pay multimillion dollar ransoms, and the criminal ecosystem that has developed around that.

There was Liberty Reserve, Webmoney, e-gold. Even now there's a bunch of sketchy EMIs in Belize and Lithuania like Advcash and Perfect Money. Ransomware before just wasn't highly targeted because "installs" were a lot cheaper and there was lots of other profitable easier scams to run like spamming pharma, FakeAV, etc. An increased amount of attacks like the Colonial Pipeline hack may have coincided with the rise of cryptocurrency but I think it would have happened even without it. There has always been groups that "cash out" fradulent wire transfers for 50-60%, go read wwh-club[.]vip or bhf[.]io if you want to know more (I read these occasionally out of curiosity but there are more "elite" forums out there). Not really any reason to think most of these attacks couldn't have worked with just paying ransom by wire transfers, especially when you consider that after the money has gone through a few countries it is practically unseizable given the amount of time international cooperation takes.

> https://www.justice.gov/opa/pr/founder-and-majority-owner-cr...

Oh no not Bitzlato! /s

I can't believe you fell for that, DOJ is the only grifter here. They actually did the FUD pre-announcement and for an exchange nobody ever heard of.

Did you already forget about FTX?

Don't you think that this holds as a warning for other much bigger exchanges?

No I don’t and what does todays announcement have to do with FTX? Aside from showing that the US government is proactive at investigating irrelevant exchanges while failing to protect anybody from mismanaged and systemically important exchanges.

Always funny how crypto-bros espouse the joys of being free from government regulation while also whining that government regulation didn't protect them from crypto grifters.

Is that what you read?

I read that people keep using mismanaged companies that happen to broker crypto assets, and then I read you conflate that with "crypto".

The best analogy to me is seeing a hardhat incident at a construction company, and deciding that "buildings" are a flawed concept, along with everyone that uses them, and perhaps lumber as well. When you should just criticize the construction company.

> Moreover, Legkodymov – who himself administered Bitzlato from Miami in 2022 and 2023 – received reports reflecting substantial traffic to Bitzlato’s website from U.S.-based Internet Protocol addresses, including over 250 million such visits in July 2022.

I don’t believe the DoJ here either. That’s like every other American visiting that website that month. Or am I to believe a small subset visited hundreds of times per month? On a site that isn’t really about trading but more about actually moving money around?

DDoS attack reflected in a monthly Cloudflare email report?

>https://www.justice.gov/opa/pr/founder-and-majority-owner-cr...

Bitzlato, a no-KYC exchange that has never been mentioned on HN before this DoJ announcement. Bitzlato has also essentially never been discussed on reddit, only included in some lists of no-KYC exchanges.

Big whoop.