
Crypto Market Crash Leaving Bankrupt Startups in Its Wake - petethomas
https://www.bloomberg.com/news/articles/2018-12-06/crypto-market-crash-is-causing-startups-to-shutter-operations
======
Alex3917
> Many of the companies are suffering because they kept a portion of their
> funds in digital assets

Lol that makes it sound like they had a choice. Because essentially none of
the ICOs did KYC/AML, none of them were allowed to create bank accounts
anywhere worldwide so they had to keep their money in ETH.

That’s why they’re just starting to go bankrupt and will mostly all go
bankrupt in 2019. If you think it’s a bear market now, the real crash hasn’t
even started yet.

If you want to see something typical, here is what Jez, the founder of
FunFair, wrote one year ago on Reddit:

"in the august company announcement we said we were holding more than a year's
running cost in cash and thats still the case. our holdings are approx $6m in
cash (dollars), and several million in bitcoin (which keeps going up in
value!) and a lot more in eth. in short, we have capital of more than $30m, at
current valuations. we're not going to starve in 2019, unless bitcoin and eth
values plummet which seems unlikely. bitcoin is more than double the price of
the time of our token sale in june."

~~~
darawk
> Lol that makes it sound like they had a choice.

They could have simply kept their assets in stable coins, like Dai, Tether,
etc..They could also sell into USD on exchanges that allow you to trade USD
(e.g. Kraken). Another option would have been to open a hedging short position
on say, Bitmex. There's lots of ways they could have cashed out, effectively.

~~~
homakov
>They could have simply kept their assets in stable coins, like Dai, Tether,
etc..

To turn into dust?

>They could also sell into USD on exchanges that allow you to trade USD (e.g.
Kraken).

And trust Kraken then.

>Another option would have been to open a hedging short position on say,
Bitmex.

and trust bitmex then.

There are no scalable options to cash out $10m to a bank and sleep well. You
could cash out into some "stable coin" only to wake up to it costing $0.04
(hello nubits). Tether is no safer in that matter.

~~~
darawk
> To turn into dust?

Oh, you mean the 'dust' that is worth exactly $1 at this moment, where
Ethereum has lost 90% of its value? That dust?

> And trust Kraken then.

Yep, the exchange that's been trustworthy and operated seamlessly since its
inception, sure. And still does.

> There are no scalable options to cash out $10m to a bank and sleep well. You
> could cash out into some "stable coin" only to wake up to it costing $0.04
> (hello nubits). Tether is no safer in that matter.

You may not sleep perfectly, but you'll sleep a lot better than if you're
holding it in crypto. And that is my point. And if you wanted to use Dai, you
could actually sleep perfectly. Dai has held up perfectly well, and you can
hold it off-exchange.

~~~
manigandham
_Past performance does not indicate future results._

The most common disclaimer in finance, but equally applicable to all things in
life.

~~~
darawk
That's a cute saying, but let me know when you park your money in a bank that
opened yesterday.

~~~
manigandham
I don't see your point. It's a common legal statement to explain that there
are no guarantees. Are you arguing that you can in fact guarantee what the
market is going to do?

~~~
darawk
No, i'm arguing that you are not making any kind of point by saying that. What
is your statement intended to prove?

------
gigatexal
This is what efficient markets do according to theory: capital deployed in
areas not as productive relative to another move to the more productive one.
Wait or is that just crazy investors hoping to get into the next bubble?
Either way good. All these alt-coin save-the-world businesses can go the way
of the do-do, I still need tools to help make Ansible not suck and learning
K8s and figuring out how to scale MySQL. I’d rather see money and talent go
into making tools that are actually useful even more useful than creating self
directed businesses etc.

~~~
wpietri
It's a very good point. A lot of smart people jumped into an area that if I'm
feeling very generous I would call "unproven". And I'm all for startups trying
new things, but we could have learned just as much about the possible utility
of cryptocurrencies with 100x less resources.

My main worry now is that some of the people will have been damaged by this.
Some of the interest we can write off as irrational exuberance; hopefully some
will have gotten their fingers usefully burned and will be more careful
choosing what they work on next time. But a lot of the field was somewhere
between chasing a bubble and outright scammy.

It reminds me of people I've seen burned by MLM schemes. Some say, "never
again!" But some really buy into the get-rich-quick thinking and will keep on
making the same mistake in different forms. "This time it will be different!"
But it never is.

~~~
decentralised
>I would call "unproven".

Why wouldn't you call it novel? It's only 10 year old technology at this
stage.

~~~
berbec
What other ten year old technologies, that went on to be successful, were as
useless for their stated purpose as crypto?

If crypto is money, can I:

Spend it at Amazon? My grocery store? My corner deli? Pay my rent? Pay my
employees?

If crypto is a store of value can I trust it will have any rational storage
value over any time period?

~~~
yxhuvud
Digital cameras, when invented back in the 70s. It took decades until they
were usable, and still another decade until they started to approach the
quality of nondigital.

~~~
wpietri
It's not a very good example, in that the barrier there was physical
development of hardware. This is purely a software problem.

Another obvious difference is that from the first moment they were on the
market, they had some practical use, and the amount of use grew quickly. If we
count from the Kodak DCS 100 introduced in 1991 at a price of $20,000, then
ten years later we see that they were being bought at the rate of 18 million
units a year and rapidly rising. [1]

Bitcoin, in contrast, has very little practical use 10 years after
introduction. Its merchant adoption peaked years ago. That's far short of what
an actually useful digital payments product can do. Look at M-Pesa [2] for
contrast. It was introduced only a year early than Bitcoin. It has tens of
millions of active users, and processes up to 900 transactions per second,
with an average of 160 per second. [3] A huge success compared with Bitcoin's
average of 3-4 transactions per second, most of which are speculative rather
than practical. [4]

[1]
[https://www.dpreview.com/articles/5474101424/pmaresearch2003...](https://www.dpreview.com/articles/5474101424/pmaresearch2003sales)

[2]
[https://en.wikipedia.org/wiki/M-Pesa](https://en.wikipedia.org/wiki/M-Pesa)

[3] [https://www.nation.co.ke/news/MPesa-transactions-rise-to-
Sh1...](https://www.nation.co.ke/news/MPesa-transactions-rise-to-Sh15bn-after-
systems-upgrade/1056-3194774-llu8yjz/index.html)

[4] [https://www.blockchain.com/en/charts/transactions-per-
second](https://www.blockchain.com/en/charts/transactions-per-second)

~~~
yxhuvud
> If we count from the Kodak DCS 100 introduced in 1991

Kodak invented digital cameras in 1975.

~~~
votepaunchy
>> If we count from the Kodak DCS 100 introduced in 1991

> Kodak invented digital cameras in 1975.

DigiCash was founded in 1990 based on a paper from 1983.

~~~
wpietri
Exactly. I think the fair place to start counting with both Bitcoin and
digital cameras is first consumer launch.

And with M-Pesa versus Bitcoin, they're both digital cash, so I think it's
even easier to see how badly Bitcoin has done.

------
ikeboy
>Sirin Labs, for example, raised $158 million last year to create a mobile
phone that allows consumers to trade and use crypto. The company, which will
ship its first batch of a few thousand phones in December, is now considering
abandoning hardware altogether and refocusing on shipping software for other
phone makers to use, Chief Executive Moshe Hogeg said in an interview. Sirin
now only has enough funds for six to 12 months of operations, he said.

Uh. Glad this bubble has popped. Of all the things I want in a phone, "trade
and use crypto" isn't quite a requirement. Besides existing phones trade and
use crypto quite well

~~~
easymovet
Which phone (secure computing platform) do you trust to securely store your
wallet key? All it takes to lose is an update to the wallet app that sends the
key to a server.

~~~
ikeboy
You can install from an apk and not get updates.

Besides, if all you're doing is some kind of chain of authority you could do
it through fdroid which enforces a constant key. No need for a standalone
phone which will anyway have the same components as any other phone.

~~~
easymovet
That sounds very reasonable, is there an equivalent chain of authority
possible on iOS?

------
decentralised
I was watching something on youtube recently that brought back memories of the
early days of the internet and the campaign to discredit it (it will bring
smut directly into your home... it will be all over in 5 years..) and now I
see HN users glee with the failure of fellow engineers and entrepreneurs and
the same campaign (it's a scam, it will bring drugs directly into your
home...).

The bear market has been brutal and some very good teams were caught off guard
because they lack to experience and know-how to balance a treasury or keep a
startup alive. Many of us here are also equally unqualified to succeed though.

In the aftermath of the 99 crash, Amazon shares were trading for a few dollars
and so were many other companies that today are huge monopolies. I believe
that many of the blockchain native companies that survive this crash likely
have the same growth.

~~~
jf-
The problem with your argument is that blockchain isn’t comparable to the
internet. It’s an energy inefficient immutable public ledger. There just
aren’t many, if any, applications that require an immutable public ledger, or
that derive any benefit from using one.

Some blockchains allow smart contracts. Smart contracts sound like a nice
idea, but when you think about potential use cases, you quickly realise they
actually have no utility. Any application for a smart contract requires
information from outside the blockchain which must be supplied by a trusted
authority. This being the case, why bother with blockchain at all?

~~~
erikpukinskis
“Ledger” was just the first app we worked out how to do as a blockchain.

There will be more, but the design process is hard. The reason Ledger was
cracked first is because ledgers are pretty simple.

Saying blockchain is “just a ledger” is like saying the web is “just a bunch
of nerds uploading documents about their hobbies”. That’s where it started but
after many years we learned to solve other problems with the same ideas.

~~~
spookthesunset
Your argument doesn't even make sense. The blockchain is just a ledger. A
really inefficient one, at that. It has to be inefficient because otherwise it
loses all the attributes that make it desirable to certain markets. Take that
inefficiency and you lose all that "trustless" "byzantine generals whatever"
crap and you are left with git or hell, a real database.

Face it. Blockchain is going nowhere. It was stillborn the day it was created.
It's had 10 years and nothing about it has fundamentally changed (as many
bitcoin advocates love to point out as if it was a positive thing).

Normal people who say "yeah, blockchain might have a use" are just being
polite. They don't want to state the obvious. Beyond its current use case as a
magnet for scams, fraud, pump & dumps and get rich quick schemes there is no
use for the blockchain at all.

~~~
stale2002
> It's had 10 years and nothing about it has fundamentally changed

The usecase is censorship resistant financial transactions.

It is working right now, for people in Venezuela, for example. It is working
for people who are attempting to make financial transactions, across the
world, quickly and cheaply.

Tell me a better way to make censorship resistant financial transactions, over
the internet, if you think this is useless.

------
Sargos
I think everyone can agree that cryptocurrency got way ahead of itself but HN
almost seems Luddite in it's treatment of the underlying technology to the
point that we are going to have our own "No wireless. Less space than a nomad.
Lame." moment that people will link to for years to come.

The underlying technology is actually pretty worthwhile. Ethereum is providing
a base layer protocol for apps that never go down, never fail, and are fully
trusted. That's something that future generations will take for granted but HN
is largely ignoring right now. Even Google goes down (sometimes once or twice
a month). Take a moment to imagine a few of the things you could do better if
you had 100% reliable hosting that was safe and private. And basically free.
(Either the user pays a penny or two when using your app or you pay a penny or
two for each user).

You wouldn't look at the internet in the early 90s and say it was useless
because all it does is carry short messages on Usenet which take a while to
appear. The tech was being improved. Those short pieces of messages evolved
into images and then later video and now we have the internet of today. This
isn't going to happen overnight but it's going to happen faster than the
improvement of the internet since Ethereum is just software and no hardware
needs to be rolled out.

Go ahead and ignore it right now. It's still building time. But don't assume
it's useless or beanie babies. In a few years the layer 1 protocols will be
good enough for something useful and I would bet that we see something truly
unique come out of the blockchain space that we never before knew we needed.

~~~
na85
>Ethereum is providing a base layer protocol for apps that never go down,
never fail, and are fully trusted.

Are you suggesting that Ethereum apps can have 100% uptime (never go down,
never fail), and are completely secure (fully trusted)?

Because if so I've got some shares of a bridge to sell you.

~~~
codeka
I don't even understand the benefit of 100.00% uptime, over 99.99% anyway? I
mean, I probably spend more time in a parking garage with no internet
available to me at all, than google spends being down in any given month.

I mean, I understand the idea that Google wants to increase their uptime
because every lost query is lost revenue, but OP seemed to imply there's some
intrinsic benefit that's more than just the incremental benefit...

~~~
chrisco255
Regardless of the marginal benefits of 100% uptime vs 99.99...the entire point
of ETH is that once the contract is posted to the block chain, it continues to
operate in perpetuity...and no centralized service provider or government can
take it down. That's powerful, and in our age of creeping power consolidation
by big tech cos and overreaching governments, I applaud the development of
censorship-resistant tech.

------
gizmo
Good riddance. Hopefully this will serve as a reality check for regular people
who are tempted by the siren song of quick riches. Crypto never provided any
real economic value, so this was bound to happen sooner or later. With a bit
of luck crypto will stay dead this time. Fingers crossed.

~~~
leumas
I do agree that most have been trying to solve the wrong problems with
blockchains, but to write off the technology in it's entirety seems rather
ridiculous...

Is immutability not a powerful programming concept? Is it not valuable to be
able to prove that a piece of data is exactly how it was years ago? Or to be
able to prove that a given signature was created before the corresponding
private key was lost/compromised?

~~~
PeterisP
This doesn't need cryptocurrencies, a centralized public ledger applying
hashes/signatures with something like a Merkle tree can do the same while
avoiding the necessity to constantly burn proof-of-work proportional to how
valuable your data integrity is.

------
andrewmutz
This is why SEC Reg D exists and is important.

Most of the money wiped out during the last few years is not coming from
wealthy “smart money” investors.

The money has come from the middle class and mom and pop investors.

~~~
lordnacho
There's a flip side to this.

When something goes well but mom and pop are excluded, the rich get richer.

~~~
empath75
If something is going really well, they don't need or want investment from mom
and pop. The only people who sell investments to mom-and-pop are ripoff
artists. Why else would you chase nickels and dimes from people who don't
understand your business?

~~~
joejerryronnie
Exactly! It’s much more efficient to chase millions of dollars from people who
don’t understand your business.

------
leaveyou
Does this mean that the price of video cards will fall ? or RAM ? I had to buy
a video card 2-3 months ago and the prices were so high with the only
explanation being "the coin miners".

~~~
RL_Quine
They've been low for months, with nvidia sitting on a huge amount of unsold
inventory.

[https://www.techspot.com/news/77566-nvidia-share-price-
plumm...](https://www.techspot.com/news/77566-nvidia-share-price-plummets-
wake-cryptocurrency-crash.html)

~~~
carlio
Indeed, there's a lot of talk that the new RTX 2080i have issues too so the
backlog of 1080i is there and cheaper.

------
ryuuseijin
What's interesting is that even though the value of for example Ethereum is
going down, the usage statistics seem to be much healthier, specifically
transaction volume [1] and address growth [2].

[0] [https://etherscan.io/charts](https://etherscan.io/charts)

[1] [https://etherscan.io/chart/tx](https://etherscan.io/chart/tx)

[2] [https://etherscan.io/chart/address](https://etherscan.io/chart/address)

------
Theodores
Funny how companies can go bust after getting millions from these token sales.
Quite clearly they weren't on Ramen Noodle start up mode. Okay offices need to
be paid for as do staff but it is not like they had to buy raw materials,
build steel foundries, invest in a distribution chain or anything else capital
intensive.

If they had been promising to make regular products and didn't ship then there
would be front page scandals and outrage on consumer rights TV shows. But
nobody cares, cryptocurrency has become a dirty word, normal people reading
cryptocurrency stories don't get past the headline as they know the story
already.

It will probably take a few years before documentary film makers make sense of
the shenanigans that has gone on. There are no good stories though, at least
with the dot.com crash you could tell the story through the lens of a company
that was there at the time for it to have storytelling value. Shame Tom Wolfe
is no longer with us, the crypto experiment needs someone of his character to
do the story justice.

~~~
empath75
The millions they got from token sales were demoninated in cryptocurrency. All
of them trying to cash out at once and you see what happened. A run on the
bank.

------
yalogin
People here saying the underlying concept is worth a allot. I don’t see the
use cases for a distributed consensus algorithm outside of coins. Even a
distributed ledger shared by multiple companies is probably not useful
compared to the status quo. You can always shove a square peg into a round
hole, it could go in but is it making the situation better?

------
api
I keep asking for one cryptocurrency based application or service with a lot
of users that is not directly related to cryptocurrency itself and that is not
illegal.

I keep getting nil. I keep searching independently and getting nil.

The closest I've found is the Sia storage network but it's hard to set up and
not competitive with cloud storage. If I want privacy I can just encrypt
locally before using S3, Backblaze, etc. If I want redundancy I can use two
cloud storage services in parallel.

~~~
Passthepeas
Sia is actually, at least in theory, cheaper. Long term Sia or something like
it will dominate cloud storage. Right now though, it is not big enough for
large enterprise investors, nor user-friendly enough for small
scale/individual use.

------
verroq
Emotional video of a mining startup shutting down posted a few days ago.
[https://youtube.com/watch?v=kxbCHlXZ-0U](https://youtube.com/watch?v=kxbCHlXZ-0U)

~~~
arcticfox
To me that video evoked zero sympathetic emotions from me, perhaps it's the
GoFundMe right before the #bitcoinboom hashtag, or the name "Digie Gold", or
the electricity that was just getting burned off for nothing...

------
strayamaaate
Good. 99% of it was utter bullshit and any worthwhile research was getting
drowned out.

Regardless of whether or not blockchian and cryptocurrencies end up being
pivotal technologies in future, one positive fallout is that we are asking
"how can we do this better" of some very traditional and established
industries.

------
ackfoo
Assholes and idiots, as usual, fuelled the crypto craze. They ruined a
reasonable, although flawed, means of exchange with their greed and stupidity.

There’s no value in a currency that is unstable either up or down because it’s
not possible for those who wish to use it for its intended purpose to keep
track of the fluctuations.

Plus, it was another way for monsters to destroy the planet, as if we needed
another one of those.

When will you self-centred fucks understand that your personal profit does not
justify destroying the planet?

~~~
crazyfundu
But Fiat currencies also inflate/deflate. Just that that rate is slower
comparatively that's why it is reasonable to rely on them in short span of
time.

In long run if you aren't accounting for inflation/deflation then you are on
losing end. For example, how often we hear that $10000 for that period..buy
much more in today's world.

PS: I am not trying to argue but putting across a counter point. I am not an
expert niether in crypto or in economics.

------
abootstrapper
I’m sure I’ll get buried for this, but it’s a shame that as a whole, we’ve
spent billions of dollars, created tons of carbon, and wasted untold man hours
on this blockchain and digital coin fad. At least nobody can say the concept
wasn’t fully explored.

~~~
sheeshkebab
It was more useful than gaming.

~~~
mihaifm
Not sure if this is a joke or not, but the parallel is not even close.

~~~
fastball
I actually think he might be right, so I'd like to hear more from your side of
things.

As far as I'm concerned, gaming is a drain on human productivity, often a
drain on long term happiness, and provides little economic utility.

~~~
abootstrapper
I mean, video games are about as useful as a summer swim, a piece of music,
fine art, and fictional literature. Sometimes they’re also educational.

~~~
fastball
I think the discussion was about energy consumption.

------
ThomPete
In other words, lots of great tech available at a very good price. If anyone
know of a company with a good crypto trading platform who are looking to sell
don't hesitate sending them my way.

This was just the crypto version of the dotcom bubble. The webvans and pet.com
mistakes needs to be done.

Next generation crypto startups will bring more value because the
infrastructure is going to be much further. Give it a couple of years and we
will start seeing companies build on top of blockchain rather than building
blockchain companies.

~~~
jjtheblunt
Great tech?

~~~
ThomPete
There are definitely companies who have been working on some great tech either
in the security token space or in the exchange space and I would love to be
able to acquire some of that.

Some of the types of industries we believe are going to be is anything in
"digitally created" i.e. things that are born digital and thus can be born on
the blockchain (think game assets, images, text, art, code) and then
infrastructure technologies such as security tokens which can be used to
validate inter-businesses data relationships.

But the infrastructure is still being built.

------
thetricia
The biggest takeaway for me is how important stability and deleveraging is. In
the regular stock market such price action would more likely be thought of as
crazy volatility rather than a bubble-crash situation. Before the sudden
appreciation there was a lot of optimism at similar prices. If it never
happened many of these companies wouldn't go bankrupt. Volatility killed them.

------
vongesell
I have the feeling this thread will be interesting to read in 20 years. __Not
__in the same we read Krugman 's 1998 [paraphrase] "the internet is dumb"
statement but instead from a post-truth post-hypernormalization world were
capital and code are closely entwined. You can already partially see in this
thread a technical community that would like to, but can not quite, separate
their personal bottom line from some pseudo-scientific idea of right/wrong. I
would guess 20 years from now that falsehood will have faded and this thread
will look interestingly passé.

1\.
web.archive.org/web/19980610100009/www.redherring.com/mag/issue55/economics.html

------
kayhi
"I am sure if that happened a year ago, that wouldn’t be a problem at all, a
year ago there was a lot of free money in the market. But in a bear market
there’s a change."

Ends up it's hard to run a business when you no longer have 'free money'.

------
pl0x
I used to work at ConsenSys which recently laid off 13% of their workforce and
I can tell you first hand they are a mess internally with senior leadership
burning through cash. The company has zero management and favorites are left
to do what ever they want. No wonder there is a crash, it was all one big
ponzi scheme.

~~~
latchkey
Comments like this are interesting to me. I can see from your comment history
here that you are pretty negative in what you have to say. I can see that
you're also on a HB1 and a self taught engineer without a lot of experience.
My advice to you is to take a step back and reflect on why you were let go.

Regardless of the internal structure of Consensys, I don't think that blaming
it on them or the big ponzi scheme of crypto is the answer. Reductions happen
all the time across many different industries. Especially in technology. If
anything, Consensys is doing the responsible thing and 'trimming the fat' when
times get lean. Remember, there is still >1000 people that were not affected
by the reduction.

Look inwards before blaming outwards.

~~~
pl0x
You can look inwards as much as you would like but isn't it impossible to not
see this entire industry as a ponzi scheme?

~~~
latchkey
Sorry, I do not see the entire cryptocurrency industry as a ponzi scheme. That
said, I've been in it for a long time, for other reasons that have affected me
personally [1].

[1]
[https://www.youtube.com/watch?v=LgI0liAee4s](https://www.youtube.com/watch?v=LgI0liAee4s)

------
danielor
Hopefully, the capital will not end up wasted, and at least some of these
companies can gather the resources that they have and create something of
value. If not, we will look at this speculative craze as a remarkable waste of
resources.

------
orbifold
Given that the biggest threat humanity faces is climate change, support for
crypto currencies in their current form is morally corrupt. Also I don’t see a
reason why I should buy into some scheme that disproportionately benefits
early adopters. I’m already forced to participate in one tilted economic
playing field, why expose myself to another one.

~~~
fastball
_If_ the promise of crypto plays out, it will have a huge positive impact on
climate change.

What a lot of people forget to realize when they talk about how much energy
crypto uses is how much energy the systems that are currently in place are
already using, which crypto has the potential to replace.

One such example might be property ownership and title companies. Title
companies are big business. They have large buildings, they have many
employees. The sum total of the resources being used by title companies have a
_huge_ carbon footprint.

Crypto could eliminate title companies. A blockchain is the perfect solution
for storing records of property ownership in a way that is incredibly well-
suited for the mostly digital age we find ourselves in, and would be vastly
more efficient than the way we currently manage property ownership and
transfer.

If blockchain tech becomes relevant to the point where we should be concerned
about its carbon footprint, that means it's replacing things which currently
exist which already have a huge carbon footprint.

~~~
ac29
> Crypto could eliminate title companies. A blockchain is the perfect solution

Ah yes, nothing like losing the title to your house because you can't remember
the password to decrypt your private key.

~~~
fastball
Why do you think you would need to maintain 100% ownership of your private
key?

The more relevant aspect of blockchain in this example is the hashed
distributed ledger, not the transactional nature of it. In fact, there is no
reason you'd need to use PKC type transactions at all.

------
pmorici
No surprise here, same thing that happened last crash. Any crypto company that
doesn't plan for the busts with the boom is going to meet this fate.

~~~
dev_dull
Is there precedent in the last crash? I wasn’t receiving recruiter emails from
crypto companies before the 20k crash. I think the blast radius here is much
bigger.

------
turtlecloud
The problem is that most of the software engineers here don’t have a strong
liberal education in the classics to understand the societal implications of a
decentralized money supply.

Bitcoin is not meant to be used by the people in p2p exchanges. It is meant
for large institutions. If country A wants to send country B, 5 billion, are
they going to just wire it to them??? No that’s very difficult to do and
Bitcoin solves that problem.

Historically kings were the ones that controlled the money supply, but now
that has fundamentally changed.

------
ykevinator
I think crypto is like VR. It's a great idea built by smart people but it's a
solution looking for a problem. It never got the mass adoption that justified
it's early price jumps. I genuinely hope some day someone needs it but for now
I don't think venmo and dumb contracts are expensive enough or risky enough to
incentivize the masses to adopt.

------
randaouser
The best use case for Blockchain is for internet money. Many seem to forget
that a majority of the world has limited access to banking resources.
Platforms like Ethereum will allow for marketplaces that cannot be manipulated
by the ones operating them, though, it will always be subject to manipulation
by the actors on the network.

------
ceriodamus
I remember friends and collegues who were all crazed when the bubble started.
They were buying, spamming on facebook about how cryptocurrency was the way to
go and how they have a high R.O.I etc.

But I knew and just like physics, all increasing bubbles eventually burst.
Afterwards it was the bankers fault. All various conspiracy theories etc...

~~~
rs86
There is the theory that the bear market is just the FED trying to buy all
Bitcoin at low price.

------
throwaway713824
How's chain.com doing? Anyone use their APIs?

~~~
kenneth
They were acquired by Stellar's commercial division, Lightyear and merged to
form a new entity/brand called Interstellar. It's now an enterprise consulting
company with the aim of getting Stellar used in production and deployed more
widely.

------
p0nce
And nothing of value was lost.

------
gammateam
Not more dubious than traditionally funded tech ventures we've all worked at
till our 1 year cliff.

Just more liquid!

So therefore I'm not sure why an article that mentions 2 downsizing companies,
and 2 discontinued companies, amongst 1,180, is treated as validation amongst
the hackernews crowd.

I think its really strange how separately this particular buzzword sector is
treated here.

------
golergka
Play stupid games, win stupid prizes.

------
wyck
Let's all wait and see what Craig Wright is building with SPV ;)

------
fouc
Gosh.. This foreshadowing the upcoming recession.

~~~
splatt
What are you seeing that indicates an upcoming recession? Economic data looks
solid currently.

~~~
Aeroi
Inversion of US treasury yield curve, 52 week lows in the tech sector,
dissolve of NAFTA, trade wars with Asia. Excess money poured into failed tech.
Oil+Gas at years low with excess supply. The death of Coal. Big banks in
decline.

------
KasianFranks
Best time to build a crypto company. It almost seems like too many people in
the HN filter forgot about how closely this resembles the dotcom boom and
bust.

~~~
bdcravens
Of course. In 2002 you'd probably be laughed at. You also could no longer just
stick "e" at the front of your company name, or ".com" at the end, and get
instant riches. (Just like "blockchain" today)

It'll require a different class of entrepreneur, one who is patient, has a
longer vision, and is willing to build boring companies. (Look at the
companies that survived the dotcom bust)

~~~
KasianFranks
Precisely.

------
quadcore
While bitcoin can crash, like a cockroach it can hardly die. So if the tech is
better than visa, it should prevail eventually.

~~~
Rjevski
Bitcoin is not better than MasterCard/Visa for the majority of day to day
transactions.

~~~
baq
Just 1000x slower.

------
askmike
I'm about to go live with my crypto startup[1] (it's a SaaS version of my open
source app[2] on Github since 2013, with a market place and other premium
features). I bootstrapped the whole thing, but the tech is 90% my open source
app that already existed.

My app relies on people being interested in trading. Right now there is a lot
of volatility in the markets (which means people are watching them). But most
people have gotten burned hard in the last few weeks, it's not looking great
if the markets keep going down like this.

[1]: [https://gekkoplus.com](https://gekkoplus.com)

[2]: [https://gekko.wizb.it](https://gekko.wizb.it)

------
sheeshkebab
Bitcoin largely was born as a response to financial crisis that nearly wiped
out worldwide financial system 10 years ago.

With the leveraging currently going on, albeit at government level, i wonder
how long it will be before next financial mess happens that would resurrect
these deflationary, government currency decoupled instruments.

~~~
tedajax
> Bitcoin largely was born as a response to financial crisis that nearly wiped
> out worldwide financial system 10 years ago.

I'm by no means an expert here but this seems... very not true.

~~~
haakon
It's not, it's just a popular and appealing narrative. Bitcoin was in
development for at least a few years before the financial crisis, but its
developer's own admission.

~~~
anonymouzz
It was in development before, but the at least philosophical ties to the
troubles of the classic economic systems are right there in the Genesis block
of Bitcoin, persisted forever by Satoshi Nakamoto:

[https://en.bitcoin.it/wiki/Genesis_block](https://en.bitcoin.it/wiki/Genesis_block)

Scroll to "Coinbase".

~~~
artursapek
Exactly. The very first block in the very first blockchain directly referenced
classic economic systems' instability.

