Yet every example you gave was over 10 years ago and there has been regulation enacted to prevent that kind of exploit. Meanwhile every week some crypto scam blows losing some people billions, hundreds of millions or just tens if it's a good week.
Sounds like you are making an emotional argument here. Outright scams do exist in the crypto arena since we are in the early days. But 2-3 decades from now, I can see crypto (or some version of it) being robust and ubiquitous.
Scams happened over the internet, but didn't exploit critical problems with the technology itself.
Crypto scams exploit problems with crypto itself. Where else can a tiny mistake allow people to irreversibly drain your account in an instant and vanish?
I’m pretty appalled by some of the comments here. If someone scams people it doesn’t matter how complex the scam was or how stupid the victim was. It is a crime. We aren’t talking about robbing a convenience store here. 40 billion dollars - people’s life savings were completely put up in flames in the name of “innovation”. This is out of control. The reason these sentences need to happen is because retail investors need to be properly informed of the risks, and if leaders of crypto companies continue to say it’s stable and safe they should be prosecuted when it turns out not to be the case.
No one claimed there weren't scammers in crypto, this is a phoney argument. The existence of scammers using fiat currency doesn't stop you from supporting fiat currency. This is about as legit an argument as the usual "pedos/terrorists/drug-dealers/mafia use the internet/encrypted messaging therefore internet/encrypted messaging BAD".
I think the argument is that there's nothing to stop this from happening all the time and maybe even perpetrated by the same people. Yes, scams happen, but there are repercussions and sometimes preventative measures even work. The Mt. Gox soap opera is not something that would occur in a regulated baking environment (at least in the US environment), but in bitcoin it's been dragged out for months (since it became a target of the US Government). It's bad publicity if nothing else.
I believe in bitcoin and its long term potential, but there is no question that lack of regulated exchanges will stunt its long term acceptance.
It was only natural that so many scams came out of the crypto space. It's an unregulated field that's attracting millions of US dollars. Plus, you could steal a bunch and get away with it.
I understand the crypto-currency market saw a sudden increase of capital which lead to scams and fraud. While this is terrible, but this is a side-affect of new technology, even something as old as email, still has this problem. People even today get scammed over email by bad actors pretending to be the Government or some other entity.
I'm not talking about crypto-currency at large, but just bitcoin.
i really hate this analogy but if you want to avoid scams avoid internet. crypto, for whatever reason is treated as special while most are commited with all sorts of hacks or social engineering.
on the other hand i do recognize this is an issue but imo the only thing you can do is education. crypto has valid unique amazing usecases and it enables things that were not possible before.
You're talking about billions of... dollars. Sounds to me like more scams exist because of fiat. Are you implying that scams don't exist with dollars, and it's the crypto alone which makes for fraud? Or is it that, if it's abused for corrupption and fraud, then it's hurting people so we should do away with it, like fiat?
When you read crypto-related indictments, it shows how little is novel about crypto scams. They're almost all scams that were known in the 19th century, or earlier. There are Ponzi schemes. There are pumps and dumps. There are fake assets. There are bucket shops. The classic fraud of just stealing the assets in the customer accounts remains popular.
Bloomberg points out that the SEC, the CFTC, the FTC, and the Justice Department seem to have arrived at a common position that it's just good old-fashioned crime. It can be dealt with by following the money and putting people in jail.
The truth is if it involves any form of money there are scams abound. Crypto is no difference. Our entire economy almost collapsed in 2008 because of scams.
What makes you so sure that "Bitcoin and the honest cryptos" aren't just a way some folks are exploiting to be the new wealthy tyranny by playing a game they can win faster by duping others?
These types of games have been played for ages, the behavior is similar, and the end result seems to be the same: major gains for a few bunch, and losses for the late comers.
We've seen it all: ICOs, DAOs, NFTs, what other scheme will resurface next until there are actual regulations in place to prohibit false advertising and bogus claims.
Of course I'm throwing the baby with the bath water when I say this, but reality is that the barrier of entry for scams and schemes is so low that something must be done.
You are both going around my very simple argument that these mind-blowingly huge piles of money poured into crypto scams, don't undermine the undeniable reality of crypto that is not a scam.
Yes, people pouring their savings in tulips, fake railroad companies, and beanie babies is absurd. Does it follow that tulips, railroad companies, and baby plushies are scams and criminal in nature? The grifters and their victims moved on, and the underlying objects of speculation seem to exist and do their respective jobs just fine now.
Crypto is doing its job just fine of being a trustless and permissionless way of transferring value. It doesn't care if grifters hype, pump, and dump its tokens. The few actual decentralized networks in existence just keep running and securing their immutable ledgers. The few actual peer-to-peer researchers and developers keep improving them.
Every innovation has had this pattern of behaviour. Steam railways, dotcom bubble etc.
Part of new technology is many scammers entering it and exploiting the situation. Of course in many cases this isn't actually planned scamming, just taking risks in a new market and losing money.
What most here in this thread are basically arguing is blockchain is evil and shouldn't exist. Well, then neither should the internet or steam railways. It's shows a complete lack of understanding of human behaviour and history.
Really sad to see from the HN crowd. They are falling for the narrative built by people threatened by crypto, which is basically the people in power currently. Of course these are also the people against free speech. It's not an accident this is happening.
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