The crypto community has always made big promises. What has always been said is that the crypto way is much better than the ways of the current financial and banking system. In fact, on many occasions, the 2008 financial crisis has been used as an example of what would never happen in crypto. There is a meme around that summarizes this sentiment: “Dad, what is a bank? Asks a child in 2030.”
Apparently this wild west-style libertarian utopia is better, because the market is more efficient in absolute freedom following the tradition of classical liberalism. This free market fundamentalism combined with a hard money theory and a strong anti-statist spirit becomes an epiphany for new converts who express this mystical experience with “At last, I understand money”.
This all sounds very nice (in theory). But what about the FTX collapse? The toughest dismiss the collapse by marking distance like Pilate. “FTX is not Bitcoin.” This, of course, is an argumentative resource widely used by communists and socialists to defend their utopia. “It is not the project. It’s the people in power.” The ideal is perfect. But the application of that ideal on that occasion was not. Of course It is not the same to promise utopia than to build utopia. And it is not the same to criticize from the opposition as to fulfill what was promised once in power.
For better or worse, we must accept that these collapses à la Lehman Brothers represent a serious blow to the reputation and credibility of the entire crypto ecosystem. Here we are going to pay just for sinners. And, at this time of the game, we cannot deny our “crazy”. Libertarian or not, self-custody or not, the price falls for everyone.
Can you imagine a hedge fund telling its clients that they are going to buy crypto right now? It is quite naive to assume that this heavy blow to reputation and credibility will not have an effect on demand.. This means that the recovery will surely take longer than anticipated due to all these setbacks. Or, put another way, it is not a matter of drawing lines on a graph. It is not a matter of celebrating the fall as a great opportunity and nothing more. Namely, we cannot talk about the price of Bitcoin without taking demand into account. Where will the buyers come from?
We must remember that trust can be lost in an instant. But, to get it back, it takes a long time. Ah, but, on Twitter, there are already several wise men announcing the start of a new bullish boom and recommending “buy the dip” at this very moment. Is this realistic? Where will these buyers come from?
Now, let’s talk about the top crypto news of the week according to Cointelegraph in Spanish. This is not an informative summary. This is an opinion article. The intention is to reflect on the following headlines in a skeptical and critical way. This is an article for free thinkers.
Binance Shares Wallet Addresses and Activity Following Proof-of-Reserve Commitment
Sam Bankman-Fried’s response during the early crashes remind us that it is very easy to write a tweet and send a press release to inject an image of solidity into the minds of others. I mean, In this world of social networks, it is very easy to set up a theater.
Promises are cheap. Boy wonder used the Terra/Luna crisis and the Celsius crisis to represent himself as our saving hero. Which was actually a farce. Because his supposed solidity was as fragile as the solidity of the damsels in distress he sought to rescue.
What What is needed are deep reforms. Exchanges need to get serious about it. Y I don’t mean more technical paraphernalia that only they understand and control. I mean regulation, independent audits, and risk management. Many in this industry hide behind libertarian dogmas (so popular in the crypto community) in order not to conform to the practices of transparency and accounting responsibility. And they know very well that a headline with something that sounds like more cryptographic code like “proof-of-reserve” will calm the community down for a while. Do you think that thisproof-of-reserveWill it be enough for regulators? It’s a step. But it’s not enough. Regulation is on the way, whether we like it or not. ANDsto of the “proof-of-reserve” seems more like an effort to project an image than a deep and real reform.
The tenth edition of Labitconf started in Buenos Aires, Argentina
These meeting spaces are necessary. People need to see each other. I personally prefer when these events are used more for reflection than for promotion. Because we already receive a lot of advertising via the Internet.
Vitalik Buterin in Labitconf: “Sometimes it seems that more regulation is better but we have to see what type of regulation is necessary”
Regulation, like it or not, is on the way. And it will not discriminate based on idiosyncrasy. In other words, it comes to everyone equally. So, the debate should not revolve between regulation or non-regulation. Efforts must revolve around the implementation of the best possible regulation. I know full well that’s not exactly what deregulation radicals prefer to hear. But, in this case, we have to be more pragmatic. Since non-regulation is not an option. The second best option is good regulation. What is a good regulation? Well, that is the debate that should be opened.
Exchanges Remove FTX Token Pairs From Their Trading Platforms
You are right. Better late than never.
Nayib Bukele, President of El Salvador, announces that the country will buy 1 BTC daily starting November 18
Bukele as a Bitcoin investor represents exactly what not to do. Subject was late in the cycle and bought high. As simple as that. And, to make matters worse, using credit and public money. He bought into the falls by bragging about it on social media. But he bought at the worst time. That is, he bought at the end of the bullish cycle and at the beginning of the bearish cycle. That grace translates into unrealized losses. In other words, today his investment is under water. And with an external debt that does not inspire much confidence. Default risk?
This new strategy of buying a BTC every day is much better. In this opportunity, you will be buying more “cheap” and making “dollar cost averaging”. Better. But where will these dollars come from? Bukele has not been very transparent with his purchases. And I’m afraid that his neighborhood handsome style still doesn’t inspire much confidence among international capitals. How do I know? Thanks to country risk. How are Salvadoran bonds perceived in the financial world?
Disclaimer: The information and/or opinions expressed in this article do not necessarily represent the views or editorial line of Cointelegraph. The information presented here should not be taken as financial advice or investment recommendation. All investment and commercial movement involve risks and it is the responsibility of each person to do their due research before making an investment decision.
It may interest you:
Binance Shares Wallet Addresses and Activity Following Proof-of-Reserve Commitment
The tenth edition of Labitconf started in Buenos Aires, Argentina
Vitalik Buterin in Labitconf: “Sometimes it seems that more regulation is better but we have to see what type of regulation is necessary”
Exchanges Remove FTX Token Pairs From Their Trading Platforms
Nayib Bukele, President of El Salvador, announces that the country will buy 1 BTC daily starting November 18
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