Lets talk about the future of finance. Now… I say those words “The future of finance”... with an immeasurable amount of sarcasm and disdain. Crypto is not the future of anything… if it were to be an evolution at all… it would be an exacerbated playground of everything that is currently WRONG with modern finance… masquerading under a set of illogical and often contradictory ideals… making it little more than a joke… with obscenely damaging consequences.
I know… plenty of people are gonna flood the comment section raving about fiat currency, fractional reserves, or the central banking cartel… and they’re not wrong… those things are bad… flawed, or prone to certain forms of abuse… but having watched the crypto bubble since it was born… traded within it for the better part of 10 years… (as far back as 2012)... I wanted to take some time… right now… and highlight just how ridiculous… absurd… and even comical the industry has become.
Now… before the screeching sets in too hard… let me present some examples. Crypto has gone through a variety of “Phases.” In 2013… there was a dramatic rise that put bitcoin on the map… followed by brutal collapse because a Magic the gathering trading card website (which had been repurposed into the largest bitcoin trading platform on the planet) got hacked… and lost 850 thousand coins. At todays price? That would be 16 billion dollars… taken from a website initially designed to trade fantasy hobby cards. Heck of start.
Thats phase one… early adoption… wild volatility… dramatic price rise… and people like ME… were shilling the hell out of it as the future of currency, finance, and technology all rolled into one. I remember when overstock.com came on board and accepted bitcoin payments… we went nuts over that. I remember ranting about it to glassy eyed sophomores in a winter break dormitory… and I remember riding the wave of “financial revolution” from 200 dollars… to twelve hundred dollars… and all the way back down to 200 again.
Those were the good old days. Phase one was when the technology felt… unencumbered. Nobody really knew what the fuck it was… we were using sketchy websites that obviously weren’t prepared to handle this shit… and I myself managed to get out of mt.gox before the ultimate collapse… but it served as an extremely effective “wake up call”... signalling that the world of Crypto was in for a bit of a rough ride.
Phase two is where things got wild. Bitcoin went from a few hundred dollars… to twenty THOUSAND dollars per coin… and with it came widespread, mainstream attention. People began selling their cars, houses, and children to buy as much of the token as possible. (yes, thats hyperbole… but just barely…) This was when a wider market of “crypto” became more mainstream as well… and we started to see that the industry is just a twisted amalgamation of everything bad about modern finance… x10… all at once.
“Altcoins”... became all the rage… and STABLECOINS began to appear. It turned out (according to research from University of Texas professor John Griffin… notorious for his ability to spot financial fraud)... that more than half of bitcoins dramatic price rise… had been manipulation through a stablecoin called “Tether.” You see… crypto is touted as the future of finance… a revolution on existing norms and a technology immune to central banking corruption… but in reality? Crypto HAD a central bank… and its name… was tether.
I could go on for HOURS about the toxic impacts of Tether… and the eventual collapse it will cause… but this is more of an overview… not a specific investigation. If you want something like that though… im going to link a video down below by the youtuber “coffeezilla” that is extremely well made, and explains the entire thing.
Phase two is where the wheels came off. Crypto got a massively corrupt central bank… (of sorts)... people were copy pasting “white papers” and “project profiles” and then absconding with all the cash… more “use cases” for blockchain were being conceptualized… or advertised than could EVER possibly be made… and the entire thing became a breeding ground of scams… illicit activity… money laundering… corruption and mismanagement at every level, for every reason… in practically every single “token” or “project.”
That was fun… but it was NOTHING compared to Phase 3. In Late 2020… and early 2021… Bitcoin went parabolic. Pretty much every single token (shitcoin or not) went parabolic… and with that new all time high… came widespread, institutional influence.
Crypto became a part of the existing financial world… only worse. It was prone to every single harmful activity that regular finance was plagued by… except faster and more severe. Crypto became a criminal vice… a fraud vice… a rug pull machine… and a self propelled multi trillion dollar industry that has more severe (and frequent) lapses than any other sector… or even sovereign GOVERNMENT… on planet earth.
Lets put this in perspective. The top 10 largest bank heists in global history… are as follows. The dunbar armored robbery… 1997. 18.9 million dollars. The United California bank heist. 1972… 30 million. British bank of the middle east… 1976… 20 to 50 million. The Northern Ireland bank robbery… 2004… 41 million. The Brinks Mat robbery… 1983… also 41 million. Banco Central… 2005… 71 million. Securitas depot… 2006… 83 million…. Knightsbridge security… 1987… 50 million… and then TWO robberies in Baghdad iraq… one in 2007, and one in 2003… one of them for 282 million… and the other 920 million.
The 920 million robbery was quite literally the DICTATOR leader of an entire COUNTRY… robbing their central bank… and this top ten list takes place over the span of almost 50 years.
Now lets take a look at crypto. Just in 2022… (well… the first four MONTHS of 2022)... there was the Ronin network heist for over 625 million… Rari capital and Fei protocol… 80 million… Wormhole (325 million) Qubit protocol (another 80 million) IRA financial through “gemini” (36 million) Beanstalk stablecoin (182 million) Cash IO stablecoin (52 million) Deus finance… (hacked TWICE in two months… for 3 and then 13 million) … 134 Bored ape NFTs (At their peak floor price worth over 150 thousand dollars each… so 23 million) … and Crypto.com… 35 million.
In just FOUR MONTHS… there were 11 hacks… with combined losses of nearly 1.5 BILLION dollars… and thats just FOUR MONTHS of ONE year… where MULTIPLE of those hacks would be in the top 10 bank robberies… of all time.
If you expand the parameters… the picture becomes absolutely absurd. Removing mt-gox from the equation here (with todays value being in excess of 16 billion dollars)... from 2018 to 2022… a four year timeframe… even just the top FOUR crypto hacks… combined… were approaching 2 billion dollars stolen. Whats more… hackers, exploits and security breaches are just one aspect of loss. If we once again expand our analysis outward… we can see a whole new world of absurdity.
Lets get some context again. Lehman brothers (partially responsible for sparking the 2008 american financial crisis)... lost 3.9 billion dollars in the third quarter of 2008 shortly before it went bankrupt. This had major ramifications on a national, even global scale… but lets compare that to crypto.
Three arrows capital (crypto hedge fund) from 10 billion to zero. Terra Luna… 40 billion dollar wipeout… as one of the largest stablecoins in all of crypto. (when tether goes that’s gonna look like childs play)... Celsius network… chapter 11 bankruptcy with a 1.2 billion dollar hole in its balance sheet… and all of this was in a THREE MONTH PERIOD from may to july of 2022.
The future of finance… has seen monetary disaster on a scale that even sovereign dictators cannot rival. Financial crisis on a national scale in America… was sparked by fiscal fuckups TEN TIMES SMALLER than what we see in the crypto industry… and yet… this is the technology we are hailing as the future of our monetary system?
Lets take a different approach. I’ve talked about this before… but there is a ludicrous idea that Bitcoin (and crypto) will help end global poverty. NOPE! Turns out that bitcoin has a gini-coefficient (a mechanism to measure income and wealth inequality) higher than the command economy of NORTH KOREA. Crypto has larger income and wealth disparity than any nation on earth… by far… it has more wealth concentration and extraction of capital from poor to rich than any other financial market in history… but again… it’s the future of finance… so why should we care.
How about this one… “bitcoin is a hedge against inflation”... and “bitcoin is not correlated to traditional market conditions.”... NOPE AGAIN!.... Bitcoin and other major tokens absolutely ARE now correlated to traditional market conditions… (like job reports in America)... and its a great hedge against inflation… when your investment is depreciating by massive percentages… while the money you invested in the first place is losing value.
How about a more recent example though. Technology moves fast… its a budding industry… I have to cut them some slack!... ok… i will. Early October, 2022, the BNB Chain (binance chain) was hacked for 566 million dollars. Ok… just another hack. So what. Well… they had to SHUT DOWN the entire chain in order to try and minimize damage… because someone found an exploit. When was the last time you heard about an “exploit”… that caused all of… i dont know, “Bank of America” to just go offline. Huh.
There is this myth… that crypto is “decentralized.” … wrong for a third time. Centralized companies… shutting down the entire chain… or making augmentations is completely normal. Celsius network was telling users to “unbank themselves”... and then goes belly up with over a billion dollars gone as a central entity where users were dumping all their funds. (kind of like a fucking bank… huh) There are HIGHLY concentrated epicenters of power and wealth in crypto that serve an identical purpose, exercising identical power… when compared to traditional financial institutions… and yet somehow this word “decentralized” gets regurgitated over, and over, and over again. Its exhausting.
The final myth I want to delve into… is “anonymity” and “security”... hopefully we have fully torn down the idea that anything in crypto is actually secure… because there have been more breaches and stolen funds than any other industry by far in a comparable timeframe… also 14 billion dollars have been stolen by crypto scammers in 2021… which stacks up against 5.8 billion dollars reported to the FTC in that same year… meaning that Crypto has surpassed FTC reporting for a fiscal year by well over double… so thats fun. But anyways… the second pillar of “anonymity” … is ALSO a lie.
Bitcoin transactions can be traced. US authorities have actually CAUGHT bad actors responsible for hacks and heists on multiple occasions… and the process of tracking user activity becomes exponentially easier… as soon as you use one of the centralized tokens or protocols… which is basically ALL OF THEM. Tracked by a centralized company… which is governed by sovereign laws, and subject to imprisonment, sanction or fines just like any other business entity… crypto users spout these buzzwords… like “anonymity” and “security”... that simply could not be any further from the truth.
The “future of finance” seems to be something that is less secure, more prone to frequent, large scale breaches, hacks, and heists… chronic and EXTREMELY high profile bankruptcies (to the tune of billions, or tens of billions lost)... with all the traditional drawbacks of centralized control. They even have a brand NEW type of vulnerability… demonstrated by the nearly 200 million dollar NOMAD hack. (yeah, forgot about that one… there are too many to count).
Nomad (a cross chain messaging protocol… or “bridge”)... got hacked in what is probably one of the only REAL examples of decentralized activity in the entire crypto space. A vulnerability was found… and then multiple people began just… taking out the money. It was like one of those videos where 20 people are just looting a store… but it was tens of millions of dollars… of other peoples money.
Imagine if you stuck your money in a Chase bank… and then one day 50 people figured out how to steal all of it… in under an hour… from all over the world… and you cant get it back… because you dont have ANY of the necessary protections that are given to actual, legitimate financial institutions. Does that sound like a real future? Does that sound like the solution to our broken monetary system? Or does it sound like a bad joke, driven by greed, and fomo… that has now given way to complete control from established financial entities… who abuse it worse than any other market on earth.
Crypto… is not the future of finance. It is the future of hardship and losses… it is the future of colossal failure… and its the future (for all too many people) of bankruptcy. You should treat this entire industry with more skepticism and aversion than almost any other market in the world… and even then… it probably wouldn’t be enough.
Bottom line… (and I know that this video will have numerous rage comments and “you just dont understand the future!” posts… but i dont care)... bottom line… the hilarity of thinking that cryptocurrency is the future of finance is a joke to be laughed at… and a belief to be ridiculed… lets do some of that. The closest it will get… is a blockchain based… highly controlled “token” from existing banks, or a nations government. They will use it the way they already use current financial infrastructure… and it will be rolled into the existing foundation as nothing more than a minor blip. In essence… it will be nothing other than a slight augmentation on how the current financial system operates.