>>>
In the case of FTX, customers are likely to lose money due to outright fraud rather than losses on the underlying securities they owned. Regulators failed to do their jobs. The system failed.
>>>
I took an adult-ed course in "Scams and Scammers" recently. My prof's opinion was that he wasn't sure if Bitcoin (and other cybercurrencies…
In the case of FTX, customers are likely to lose money due to outright fraud rather than losses on the underlying securities they owned. Regulators failed to do their jobs. The system failed.
>>>
I took an adult-ed course in "Scams and Scammers" recently. My prof's opinion was that he wasn't sure if Bitcoin (and other cybercurrencies) was a scam, but he _was_ sure that the cryptocurrency world was loaded with scammers. Certainly, the number of busted crypto banks, with all depositor funds lost, should have been a warning.
I'm not sure I would call anything in the crypto world a "security". That word suggests something which has a good chance of yielding a positive return. The argument for "positive return" should be stronger than "Someone else will surely pay more than you did!".
"The regulators failed to do their job" -- well, the mass of originators and investors were begging regulators to stay out! "We don't need no stinkin' regulators -- we have the blockchain ledger to protect us from fraud!"
"The system failed". Yes, but it often does fail to protect naive investors when a new paradigm appears. I don't remember the SEC ever claiming that _any_ crypto investment offered reasonable safety.
I may have just been lucky to stay out of it, or unlucky to have missed the early days of huge profits. I have decades of IT experience, much of it in the financial industry. Cryptocurrency smelled like smoke to me, and I avoid fires.
>>>
In the case of FTX, customers are likely to lose money due to outright fraud rather than losses on the underlying securities they owned. Regulators failed to do their jobs. The system failed.
>>>
I took an adult-ed course in "Scams and Scammers" recently. My prof's opinion was that he wasn't sure if Bitcoin (and other cybercurrencies) was a scam, but he _was_ sure that the cryptocurrency world was loaded with scammers. Certainly, the number of busted crypto banks, with all depositor funds lost, should have been a warning.
I'm not sure I would call anything in the crypto world a "security". That word suggests something which has a good chance of yielding a positive return. The argument for "positive return" should be stronger than "Someone else will surely pay more than you did!".
"The regulators failed to do their job" -- well, the mass of originators and investors were begging regulators to stay out! "We don't need no stinkin' regulators -- we have the blockchain ledger to protect us from fraud!"
"The system failed". Yes, but it often does fail to protect naive investors when a new paradigm appears. I don't remember the SEC ever claiming that _any_ crypto investment offered reasonable safety.
I may have just been lucky to stay out of it, or unlucky to have missed the early days of huge profits. I have decades of IT experience, much of it in the financial industry. Cryptocurrency smelled like smoke to me, and I avoid fires.
You already know all this, of course.
. Charles