Crypto Utopia Cracking?
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Last week, three DeFi (decentralized finance) groups stepped in with emergency plans to protect their projects and users from economic turbulence in the face of collapsing cryptocurrency prices.
These DeFi crypto networks which had pledged to put users in control ended up taking charge themselves in order to survive the ongoing crisis in the digital asset market.
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11:58 as a Software Engineer with nearly 3 decades of experience I can absolutely confirm this from an IT perspective! Those participation medal generation just barge in take a dump on everything we achieved in 30 years call us obsolete opensource everything and all the problems we tackled in 2-3 decades are coming back! They never learned stuff so everything that exist prior to them, including people who did the same study and have more experience are bad and obsolete! Programming languages (while they are part of the new ones), relational databases, security basics etc. Its a no brainer that everything gets hacked! those boys and girls find themselves so smart without any trackrecord, they dont even poses the academic basics of gather info, derive facts measure pro's and cons of several options and let the facts drive your conclusion they just want something and makeup the facts and negate everything that is not in their favor.
Turkish subscribes please to your channel videos, thanks
Great video, but please try avoiding shady sponsors like PIA
Pro tip from an IT security specialist: if what you care about is your security when traveling or on internet cafés, it’s much better to add a VPN server at home, and connect through it instead.
@@PhatPazzo Indeed!
Soon the crypto community will discover, the same way the traditional finance industry discovered (over and over and over) that the rails are there for a reason.
Because the individual cant be trusted to make decisions
The "rails" are there for you to be "railroaded"??!!!!
@@Dwightstjohn-fo8ki rails as in the kind that keep people from falling off a cliff, don't be dense 🙄
To keep money flowing to the top?
@@TrollOfReason to keep money from sam bank fried
I do love how despite all of the talk of being decentralized and being more fair for everyone, all of these systems are inherently incredibly centralized, far moreso than a traditional system has ever been. And exist only to benefit a small handful of people in a way far more aggressive than traditional institutions have ever been.
The deeper you get into speculation - altcoins, NFTs, MOASS - the more you see that embraced by the rank and file. The conversation shifts away from democracy and equity toward a future that’s just as hierarchical and unequal, but this time _they_ get to be on top.
" I will not call this a ponzi scheme, just because I am not convinced yet they are smart enough to voluntarily make a ponzi scheme"
I am dying !!
The endless cycle of:
"Grrr, all this red tape is slowing me down!"
"Lets get rid of all this red tape and we'll all be rich!"
"What! I've been conned out of vast amounts of money! How is this allowed?!?"
"Finally we have put in the very reasonable protections that stop this fraud"
"Grrr, all this red tape is slowing me down!"
Now to see it happen all over with environmental regulations as well :)
That's Libertarians in a nutshell.
I know some folks like that. Regulation is a pain, it’s government overreach, it increases costs. Then their industry gets deregulated and _in that one instance_ they care about consumer protection and ensuring a quality product.
I really liked the explanation of speed running all of our past mistakes. Tether feels like a wildcat bank and Charles Ponzi is a patron saint of these high yield crypto platforms.
hahaha Charles Ponzi is the Patron Saint and Bernie Madoff is the awaited Messiah 🤣
@@theObscure3rd They are nothing compared to Tether!
any% economic collapse WR
Somebody needs to create an official "Ponzi coin", and "Madoff coin", just for a joke,... and then we can watch as everyone piles in and the coins become valuable. To the moon!
@@angelarch5352 Apparently there is a PonziCoin. And if people can't take that hint, there is also Tulip Protocol, which proclaims itself as a "Yield aggregation platform built on Solana with auto-compounding strategies for vaults."
"hard coded" contract until there's trouble then it becomes "soft code" contract which is altered to protect those that took the most risk while killing those that were financially conservative.
I think the decentralized mythos is truly shattered now. It's a bit hard to claim decentralization when one project collapsing brings down two to three exchanges, five other projects and an army of influencers
In a way it is decentralised but wrongly assumes centralisation is the cause of instability. It's really not profound that in a system of each element having equal ability to affect any other and be affected by any other it's hugely prone to a cascade of chain reactions spreading through the system unzipping everything.
@@Treblaine if you dig into the cascading failures in the crypto space though, you find that the reasons tend to come down to shared liquidity pools, projects relying on other projects to maintain a peg to the dollar, undisclosed stakes in projects by exchanges selling those projects, etc... The decentralized nature of crypto was supposed to be about not having the control of money in the hands of a few rich investors and that is turning out to be a complete lie
You're misunderstanding what the label "Decentralised" is defining. It does not mean "isolated". It means it's governance is not centralised
@@shekel2356 how is its governance not centralized? Proof of work tokens like bitcoin are governed by the miners and the cost of mining means that it's controlled by a small group. In bitcoin's case, half the mining is done by three mining companies and in ethereum's case 63% of mining is done by two. Private pools only account for around 5% of mining. Proof of stake tokens grant governance to whoever has the most money in the project just like traditional investments and, just like traditional investments, that centralizes power in the hands of the wealthy.
@@shekel2356 The governance is not centralized on paper. In practice, not only it is very much centralized, it is even MUCH more centralized than old finance.
8:30 That "Beacuse Crypto" long pause was excellent 🤣🤣👍
Haha, like "because of electrolytes" in film Idiocracy
Confession: I looked at the title and sighed because it sounded tedious, but it's Patrick Boyle so I watched. Wow. Lesson lesrned. Great explanation as always.
It's better to know
Patrick is the Adele of business YT. Lol
U know he photoshopped out his drink in hand, flowing blonde hair he has to push out of his eyes, and a cigarette hanging from his mouth
I dont remember the first title, but I finally clicked on the video when the title was: Crypto Utopia Cracking?
as an early adopter of bitcoin.. the idea of a decentralised financial system is great. but, nobody can disagree that 90% of crypto-advocates (conservative estimate) are putting all their energy into getting rich without contributing to society. There is absolutely no way a financial utopia will result from the actions of these people.
For all of civilisation, much of human creativity and ingenuity has been spent taking advantage of and extracting value from regular honest people. I am shocked that anybody believes that human designed software will somehow remove that element. more of the same, in a new package.
Yep. DeFI projects which suggest they will make you rich are an obvious no go and a red flag for a ponzi scheme. If it was truly de-centralised and for the people then it wouldn't be making any particular person or group rich.
People getting rich are not thinking of the greater good. They are thinking of themselves. When they get super rich, they loudly give back a small pittance to the workers that made them rich, and the press proclaims them as heroes. And so it continues...
IKR. These so called advocates buy into shitcoins for the moon phase. Get rich quick. Lol.
Bingo… they’re racing to centralize the next frontier.
@@Aaron565 Give examples if you disagree. Just saying he's wrong means nothing.
I'm so happy people are starting to talk about these things with a critical eye. Thanks Patrick!
And don't forget. Not your code; Not your coins. As it has always been.
A real good point!
@@loupasternak well defi has mostly been a phenomenon of the last cycle. Even if you look at all crypto as a scam the scams of a few years ago are very different than the ones going on now.
@El Dimos Karam Actually this is the whole cryptospeheres biggest scam, selling the public on the idea that it's a revolutionary technology that we just don't know what to do yet, but when we do, it sure will be revolutionary. It's not useful. It's been here for 12 years, and we still haven't found a viable working use-case.
@El Dimos Karam It is useful for things that can be done better without it
@El Dimos Karam blockchain is a _really_ cool way to solve the byzantine generals problem. it's not a good financial model.
as a software developer i find the idea of "code as law" to be completely horrifying. Makes technology seem perfect and impartial when its made by fallible humans with biases and incentives.
"Code is sometimes law" is at least more honest.
That is why in the real world law is ever evolving because there will always be people seeking and abusing the edge cases. Like hackers, but in real life.
And hackers are totally not a thing in software. All software is totally unhackable. /s
yep, it's the most arrogant overstep ever. dodgy code and a crazy violatile ecosystem that is impossible to predict i.e. orgs losing keys, hacks, etc.
@Jacques Raddit totally have worked with cards and other payment systems. Even with specs and test data, live data can be different and cause unexpected behaviour. Crypto on autopilot written by snotty nosed virgins is terrifying!
Wait until AI is writing all our laws
Wait until they start to throw barely trained interns. Just imagine how the code might look like then.
I mean the law. The hell is this world coming to?
Could hummus be an alternative investment to crypto? There are so many different flavours and if the price goes down, you can just eat it!
I'd invest immediately
I have a feeling hummus will be big!
Just called it blockchain-backed hummus.
That would need a cold chain. Is it cool enough?
Wheat, honey, and molasses keep in the cupboard better.
Next in crypto: Solana, Ethereum, Bitcoin, Cardano, Ripple all agree that having many tokens is inefficient and prone to volatility in markets. They team up to create a single token and convert their existing token to this single new token. They will call this token the FRT. Federal Reserve Token.
I really love to watch the plain bagel's favourite finance youtuber.
Bitcoin breaks $30k!!!
And I'm extremely happy with
my position. My investment’s
being paying more than my
paycheck. It's kinda relaxing actually!
If Bitcoin were to make it
back to previous ATH this
quickly, before the next halving,
it's going much higher. Most likely $150k+. But keep in mind
that no one, myself included,
know shit about fuck.
Nor do I know fuck about shit.
But I'd say it's best to begin accumulating.
Right! Also it was 16k at the
start of the year,
so a 12k run up in 4 months
isn't that bad.
+75% in 4 months isn't
just "not bad" it's phenomenal tbh,
almost unheard of for such a large
market cap asset to have such an
increase outside of crypto market.
I've earned over $80k+ pure profits
these past months. Truly Rewarding!
@@gordonramsthis Awesome!
I dealt with crypto last year
on Robinhood, tried some index
but didn't take it out so I lost it
by the end. Currently, I'm willing
to DCA 'bout 20k into btc but
I am engulfed by the thought of losing.
I'm asking - how do you
go about your investments?
Any consistent strategies?
Indeed. The crypto markets has an
intricate nature, but when done the
right way ... returns can be
really impressive! Thus far, I follow
the signals and system of
Kevin S. Mikan;
an experienced industry trader.
His in-depth investment research
and market analysis have been
invaluable in identifying profitable
opportunities for my portfolio and
his ability to simplify complex
concepts is truly remarkable.
Patrick is my favourite finance professional to listen to. Always realistic and on point
Well said! I am also here to learn how to invest after listening to a lady on tv talk about the importance of investing and how she made 7 figure in 3 month, somehow the video taught me nothing and left me even more confused, I'm a newbie and I'm open to ideas on how to invest for retirement
@@rajeshupadhyay5683
lookup Priscilla Dearmin-Turner, this is her name online, she's now the real investment prodigy since the crash and have help me recovered my loses
Despite the economic crisis and the rate of unemployment now is the best time to invest
Investment now will be wise but the truth is investing on your own will be a high risk. I think it will be best to get a professional👌
@@lezliewhicker8450Thank you, Going through her profile in her webpage, she smashed all her state certificate and accreditation🙏
Decentralization doesn't exist in systems where somebody writes and/or is maintaining the operating software of the system. These people are governing what the software does. Just look at your own pc and the automatic software updates. Your personal computer is not decentralized.
It does if the software is open source and community maintained. If your personal computer runs Linux or BSD, it is in fact decentralized. Anyone can obtain the software from numerous sources, alter it and run it.
Windows and Mac OS on the other hand require the centralized infrastructure and organisation of their respective companies to keep fuctioning properly.
I love all the passive aggressive comments: “I’ll give them the benefit of the doubt. Maybe they’re not Ponzi schemers, maybe they’re just not smart.”
Bro. On bancor, you nailed it. Plus, the DAO was controlled by two people if they acted in concert, and they always did so. The big insight you had though was that 'there are good reasons for doing things the way they are, but people have forgotten what they were.' Court cases likely do a good job of enshrining many of those reasons, with legislative and rulemaking histories filling in a bunch more. Hard to wade through all of that but you are over the target on that statement. One thing I learned from defi where I have spent a lot of time is that engineers have very little imagination. Everything is a mousetrap to them and they have little ability to account for human factors. Defi is going nowhere until proper salesmen get in there to develop something that the public can reasonably be expected to use. Let's just hope that isn't Faceberg.
People won't "use" (spend) money that is rapidly rising in value, unless they must. Spending on consumption equals divesting in growth to obtain consumables.
Sellers in commerce don't want to accept money that is rapidly falling in value. People earning wages don't want those paid in the form of money that is rapidly collapsing in value, or might soon collapse.
Lysander Spooner explained that 200 years ago wrt govt issued gold coins with a face value. People who could afford to would hoard gold, plan to melt it down and sell it, and the meantime conduct commerce with whatever else was available, paper contracts. The act of minting those coins and acquiring the gold to do that fixed an almost certain increase in the market value of the commodity above the face value of the coin, a kind of government subsidy to metal speculators.
The side effect was making money scarce, and creating pressure on the government to mint more.
The government also did or tried to make it illegal to melt down gold coins to extract the increased value. This is where Spooner, as a libertarian, had a problem. People could go to prison for doing transactions that the government itself incentivized by placing a fixed face value on 1 oz of gold.
Spooner argued that the most useful form of money for commerce had no intrinsic commodity value, and only a nominal face value. At the time, that was paper money, but electronic account entries at the bank have even less intrinsic value than paper. Paper money could be shredded and sold for home insulation or birdcage filler.
The government Fiat money that we have right now, this has no fixed value that is be set by fiat instructions or declarations by a politician. Instead it has a floating international value set by the market every second, and somewhat stabilized by the actions of the Central Bank conducting international forex swaps, to counterbalance shifts due to exports and imports, which are beyond my full understanding.
When the only incentive of defi is to earn “money” through the use of their own coin, it’s no different than acting as the intermediary of traditional banking. They just want to get paid. They could care less about a more fair financial system, free of manipulation.
👆Thanks for commenting..,
got something for you.,..,
The only man making sense of the Crypto / NFT madness.
Nfts are the future.... but its not these pictures. That is a "testnet" for a lack of better words.
There are tons of other people lmao what do you mean. Coffeezilla, Matt Binder, münecat...
@@dollarcostbackpacker1226 Can you please explain a use for NFT's ?
Because the only one I can think of is that NFT's will be used as a "product verification code" which may sound nice until you realize that most companies are moving to a
SAAS (software as a service) business model.
If they could issue NFT's to people it would make it easier to keep their products on their own website and make you use the NFT to access them rather than you buying it.
NFT's would mean the end of any digital ownership.
I mean he's been pretty wishy washy on his stance. There are people who called out the bullshit from the start, people who didn't buy into it but didn't have a negative crypto position because it would have been inconvenient for them, people who were heavily invested so they adopted a procrypto position, and the true believers. There are very few true believers.
I mostly have respect for people in the first group, while the second doesn't have my content, really its only the third group I hate.
Plain beagle
Amazing content and the way you tell the details is funny and very informative. Thank you for your help. More people need to watch this content.
As always, insightful and interesting. I've participated in several decentralized projects as an "early investor", and their goals are usually quite lofty. Creating an entirely new kind of bank, it turns out, involves a LOT of work of every kind -- engineering, programming, as well as financial planning, and auditing work. These projects really need a herculean commitment of a LOT of people who ALL want to pitch in and make something new, but they tend to use language that projects future value. Because of this, a task that needs dedicated people with vision and commitment, ends up being composed entirely of moonboys. A disaster waiting to happen.
You're talking about an entire financial system that was built by some software engineer under a pseudonym and then who took off like someone's father going out to get a pack of cigarettes. There is no vision because fundamentally, no one wants to take the responsibility to instill at least a system of ethics to guide subsequent generations of financial managers and programmers.
👆Thanks for commenting.,.
got something for you,,.
@@sweepingtime also because a lack thereof is kinda the entire point of doing something in crypto in the first place.
It's almost like a mathematical equation: removing the middle men from a financial system increases the relative power of the remaining participants. The ones who already had power (like say, the people controlling the code of a defi system) become even more influential than before.
Middle men slow down finance and make it more expensive. But at the same time they add in layers of reciprocity that make it less possible for any one individual (or small group of individuals) to completely control the system.
@@Aaron565 This is a case where you're arguing against something I didn't say. If finance is "centralized" then there are by definition fewer middle men, since all transactions can only pass through one or two.
In Bruges insert was brilliant, all the way to the end.
I’m feeling pretty good about ignoring all of the sage advice my crypto friends have been doling out nonstop.
Dear Patrick, as always, an extreme informative video, with even some recent examples of what’s happening in the DeFI world, I’m very grateful for it, thank you.
I believe that the willingness at all cost of some, to exploit blockchains for speculations and wealth gains, can pose a real threat in the technology existence itself. As the story progress, many and many witness every day how in unfair way the technology is used, it is possibile that, at this pace, no one will really employ it for some other sophisticate use-case than finace and speculation. I hope to be wrong.
I would really like to hear your thoughts about the recent default on russians bond and the ruble growth despite the war, it would be amazing.
Let’s all sing the song: “Won’t get fooled again!”
It remains to be seen if crypto can replace fiat, the costs tied to etherium are awful... however, a digital manmade gold, is what im betting on, bitcoin litecoin polygon, these coins have a capped amount, meaning they are actually more rare than gold or oil, u can fly to pluto but youll never find more crypto... these gold substitutes also have a use case, much like gold has a base value for electrical components and jewelry, crypto coins are tied to organizations that run them, updateing or making deals... polygon for instance isnt just gold, they just signed a deal to use the coin for disneys nft or collectable art division
Mining pools cannot control network. Mining pools are several thousand small miners mining bitcoin collectively and if they misbehave individual miners can redirect their hash power to another service. Also most wallets that appear having large number of bitcoins are infact exchange wallets with amny users funds. These aspects of FUD is being delt frequently before this. I think it's better to have these concerns of bitcoin discussed with a guest such as Andreas Antonopolis.
Defi is like a badly run bank with no capital buffer in case anything goes wrong and no deposit insurance. But the interest rates are good untill you lose your money.
Patrick did make a video comparing them to the old west wildcat banks...
"the interest rates are good untill you lose your money"
Or as Boomers might say, a ponzi scheme.
I think this is a valid concern about all product other than Bitcoin.
Isn’t Bitcoin the outlier here with really no centralization and no “interest rates”?
@@kineahora8736 There is a use case for a (nominally) untraceable electronic currency for unlawful transactions to provide digital functionality that cold hard cash serves in the real grey and black economies.
Lets ignore morality. The use case exists. And as Bitcoin was first to market, and is widely adopted for such it has an intrinsic value. Ethereum managed to partially niche itself into a "competitor" role.
After that there is literally no use case for further tokens. Thats it. The use case is met, its over.
Hence nothing but ponzi schemes exist in the market.
@@dairallan I think Lyn Alden also points out a use case for Bitcoin and for fiat-dollar-backed stable-coins for people in developing countries with habitually high inflation for wealth storage, where holding gold or dollars might be confiscated by the country’s central authorities, and also in these countries for doing easy transactions abroad.
But the less-decentralized alt-coins (everything other than Bitcoin) have no role…
Patrick is so much more animated when talking about his sponsor's product than the main video topic 😂
The mic quality is also better
you gotta put more effort on which give more money..
this thumbnail cracks me up for some reason
Good succinct video that laid out what DeFi is without injecting too much subjective opinion. The participation trophy joke fell really flat though.
The weakest links are the governance systems which are all quite different, one of the crucial things missing are dispute resolution protocols and other utilities like sybil resistance identity solutions that defend decentralized systems from bad actors. Protocols need community driven constitutions/guidelines that can be enshrined and upheld by oracle solutions to prevent corruption. Lastly you should ask yourself that if you plan on using decentralized systems and want to take your finances into your own hands and out of the hands of professionals/banks etc wouldn't you see the importance of learning to read code and understand code?
The topic is really well chosen, thanks for your hard job, Patrick!
For a long time I was confused by crypto and how it became valuable. It was explained to me. crypto companies take your crypto from you and pay 10% interest with the invested crypto they buy other crypto and pocket the capital gains. This happens to be the function of crypto other than ransomware attacking. now that I know I'm confused is it a Ponzi scheme or a pyramid scheme ?
The big difference between a pyramid and ponzi scheme is that investors in pyramid schemes are given the opportunity to earn more by recruiting people. There's plenty of both in the crypto world
both
100% on the mark again, as always.
For me, the thing with most Defi-protocols is that most parts (if not all) of the defi projects goes undocumented.
The same goes for stablecoins, If you can't explain how you plan to stay pegged, how can I assert where the risk is?
oh and lol please don't tell me it's backed by other crypto😆
Know your customer is irrelevant because we are all friends on the Internet.
This shows how much you know about the space. The whitepaper breaks down the mechanisms and functions of blockchains. Then all the code is open source so anyone can view the code to check for poor logic. Most crypto projects audit their code and also have bounty hunter rewards for finding poor code. True defi gives 100% transparency with on chain analytics
@@iratedu6 I get it now because everything is open source and transparent no audits are required. I apologize for thinking Tether is a fraud.
@@iratedu6 Do they have some kind of rapport per quater.
@@Aaron565 Do America realy fail so mutch that all Words countrys backed by the dollar crash.
Thanks. Made my morning. Because crypto....You need to start a new chnnel with this as the channel name. Priceless
How could people possibly think crypto would end up any different than regular finance as it became more mainstream? Those with the resources to control it will do so and it becomes centralized. That's just how it tends towards with these things, crypto acts no different...
so condescending to crypto.. it cracks me up
It's a mix of scams, greed, and stupidity.
I admire the ellegance in saying 'crypto people' instead of CRYPTO BROS
Love the balanced, intelligent analysis. And the dry humour too!
Congratulations on your new sponsor, Patrick! It is great to see you moving forward. All the best.
I don't notice any red tape or regulations in my banking. Showed my driver's license when I opened an account. That's about it. The regulations are on the banks, not the customers.
The vast majority of crypto projects currently are centralized, no difference than the current fiat system, potentially worst. Defi is used for marketing purposes only. To achieve “defi” status will take time. Bitcoin is the closest crypto to be considered decentralized, but even BTC is currently controlled by a few whales. That will change with time. Blockchain technology will be a game changer, similar to the internet revolution. It’s not only decentralized finance, but decentralization will play an important role not just in the financial sector, but in many other industries.
We need a stable physical currency like wampum. 💰
You know it makes sense.
About the bitcoin mining centralization part: Mining is not what decentralizes bitcoin, it’s the fullnodes that do that. During the blocksize wars in 2018 close to 80% of hashpower was from the big block crowd, but yet small blocks came out on top as they had the most support from fullnodes.
Yes, it was disappointing to see Patrick conflate the centralization proof of stake validators with bitcoin mining pools. Apples & oranges.
Just love how you manage to turn a complex and largely academic subject into a presentation that even a simple-minded donkey like me can make sense of.
Miners are not loyal to mining pols. This has been demonstrated many times. There is no significant centralization danger from mining pools.
Patrick , I really like your channel .
Patrick, great content as always, but I think a bit of acoustic padding (bookshelves, furniture, etc) in your recording spaces would do a lot of good for your audio quality. Cheers!
He seems to be recording in a remote location, using his phone. Maybe.
(Kanye voice)- "Graham, I'm gonna let you finish, but Patrick Boyle is the best finance TH-camr of ALL TIME."
2:15 your editor needs a raise
Participation medal generation. Im going to use this one
When a bunch of young kids learn to code, have no education in economics, and think they can make quick fortune...
Young kids? Average age in crypto is around 40.
@@greenl7661 I was thinking of Do Kwon of Terraform Labs. He may be in his 30s but he is as immature as a kid.
In a sense, code is always law, but its jurisdiction is limited. In the case of the DAO hack, for example, Ethereum's code kept running exactly as intended, but it can't stop anyone from forking it, making a new code base and doing something different with it. Human beings effectively copied and pasted the code, and made some changes to create new law. And it was human beings, also, who decided to give more value to the new version.
Recentralized is what they mean
Simple answer is if it has governance then no. If one person still owns the contract then it isn’t trust less since you must trust this individual to act maliciously.
I'm not sure why existing regulations for the exchange of currency or equities should not or could not already apply to defi. These "coins" behave like tradable equities and are speculated on as if I were to, say, buy $1,000USD worth of Japanese Yen in the hopes that the value of yen might grow faster than that of USD.
Because the entire model of "disruptive" technology is to bypass or flagrantly break existing laws and regulation. You continue breaking the law until either the law gets changed or the business fails either through the law starting to be applied properly or internal incoherence in the business model bringing the whole thing down despite its "disruptive" advantage (of course, even then, the hope is you have cashed out with an IPO or sale before then).
Crypto just makes this all easier by removing the need to find a buyer, hence all the rug pulls.
Existing regulations? Regulations that are enforced in which jurisdiction? You are commenting on video that is sponsored by a VPN provider whose sole business is to mask which jurisdiction you are physically located in. You want to regulate VPN's too?
@@JanBruunAndersen I was talking in generic terms about "disruptive" technology.
But if you specifically want an example applicable to these scams, how about Basel 3.
@@JanBruunAndersen This is not VPN's sole purpose. VPNs have many uses, and people often will use it within the same country that they are located.
I use a VPN provided my company to connect to my office network, for example.
Because all those retro-asset classes are built up on literally centuries of trust and, in the case of government vs. government, treaties with enforcement (more or less). And even without formal enforcement, globalization has made so many national economies interdependent that it's basically in everyone's best interest to keep the current system running smoothly and liquid (RU vs UA notwithstanding). This is why Mr. Boyle pointed out that Defi is speedrunning those centuries of lesson learning and trust building, but they've still got a long way to go before I'd put any trust in a DOGEBTC futures contract. I'd say Defi is right up to about 1720 and the South Seas Bubble.
As a software developer, code is never the law. The law is the law.
The problem is that crypto bros (who don't even have basic InfoSec principles) discovering code can be a definite, reproducible asset for the first time, and then getting all excited and assuming it can apply to everything in life.
"Everything as code" is a principle in IT that works very well - consistency, portability, auditing, reproductibility, version control are all far easier with it. But it's not the law.
I think you misunderstand what is meant by "code is the law". The problem with the law as we know it, is that nobody knows what the law is. The law is always up to interpretation. The law makers think it says one thing, then lawyers and judges often comes to a different interpretation, sometimes a decennium after the law was initially passed. Just look at the recent panic when a New York law on concealed carry of a gun was overturned, or when Roe vs. Wade was overturned. The law is very malleable.
Code is not. It means exactly what it says. You can throw all the kinds of input at it, and it will always give you a predictable and repeatable outcome.
@@JanBruunAndersen Actually, you've misunderstood what I've said.
Code is indeed definitive, as I said in my post. But code can never be the law. Because governments and lawyers are what make the law. Not optimistic crypto bros who think the code they write is in any way enforcable outside their Web3 environment (that is, until the authorities catch up and prosecute them for e.g. rugpulls)
Some government contracts make it an obligation though, when they require you to have soc2 or 27001 as part of your business process.
Code is lawless.
I think what you are saying is, DEFI looks like an applied research project rather than an established, proven commercial application. OK, then things will be learned that may be applicable in the real world. Fine. But, isn't any financial system that involves human beings somewhere along the line subject to all of the good and bad that makes us human? Did anyone really believe that control of Bitcoin wouldn't become concentrated in a few hands? From my vantage point, the entire crypto game looks like just another financial system involving human beings. I know, I know, it's early days and crypto Utopia is on the horizon. Or is it just a financial Chevreul illusion?
2:16 more effort than actual nft
Your videos are so good every time!
"Is DeFi Really Decentralized?"
Not really.
I mean it depends on the DeFi platform, since there aren't any standards for what defines DeFi.
You can find platforms that adhere to true decentralised control through voting and others that dont
3:30 "poorly designed systems" and I'm still laughing out loud as I type this xD - EPIC meme photo.
@@pinned-bypatrickboyle6056 You got shafted by Patrick or what is your name inferring?
Crypto reminds me of the split cap investment trusts in 2000; they all owned each other and propped up each other’s valuations….until they didn’t.
8:38 it's like government bailouts after 2008.
How about a glossary for terms like "regulatory arbitrage"?
In that case it means people go to the jurisdiction where regulations are most favorable to what they are doing/want to do.
it just means that there's a mismatch in laws that allow one to profit the difference until the loop-hole is closed or too much competition drives the profits down to nothing.
3AC made most of their initial money that way when struggling to find an edge to break into the big-leagues, as they were a first mover in the space, but eventually there was too much competition and/or the holes being closed.
A kind of Currency arbitrage would be buying games for effectively 99% off on Steam via exploiting regional currency pricing/regional currency values and then flipping the keys (which are only sometimes region locked), on a 3rd party site for 40-60% off normal price, and pocketing the profit in re-sell price in the currency you can get the most value out of.
I.e. buying a 60 dollar game for 2 bucks, and selling the key for it for 20-30-ish.
I've heard that cryptocurrency is smarter than fiat currency, defi markets set the price and it autocorrects to the coins true value, nothing.
Speed-run financial history. Brilliant explanation.
Why utopia?
patrick's videos are always such a treat
8:28 "Because crypto"
Smart Contracts alone won't be able to replace traditional finance, lending, etc. There will still need to be some sort of arbiter that reviews loans and contracts to ensure things work properly. Algorithm driven and heuristic AI models will probably fill this gap. At that point, what matters is who writes the AI. Right now, the only people really benefiting from DeFi are those behind the protocols.
Patrick's humour cheers me up no end. And I learn so much about the wacky world of craptocurrencies!
I didn't know MORE defi projects were in hot water.... Jeez.
What's the count, like 7 lending and earning projects?
Glad I stayed away from that...
😁Impermanent Losses😆😆 This is comedy gold.
A Ponzi scheme isn't a ponzi scheme because of intent, it's one because of how it operates. Like Pyramid/MLM.
and DeFi
No shit, the point here was that they were too stupid to realize what they had done.
“This is what happens when the participation medal generation gets to design financial systems”. That really did make me laugh!
So if I understand Bancor's strategy correctly, its the equivalent of printing more dollars to combat the loss of the dollars' buying power? How could that fail?
Patrick's presentation style is reminiscent of Wesley in The Princess Bride explaining the meaning of 'to the pain'. Both are largely immobile and have an articulate and dry delivery.
what... and here I am thinking you were rooting crypto all this time...
haha, I lost it at: "Which caused a backlash on twitter, the worst kind of backlash"
This is the best finance content that you can find. Thank you Patrick.
Many of these same individuals preach that they will replace Artists like myself with AI. While I work in all media, I am largely a sculptor. Does anyone really want to buy Art created by a program that was written by someone raised on "World of Warcraft"? It is my hope to attend the Royal College of Art in 2023 to earn my M.A. in Ceramics and Glass. Should we just scrap that school and replace it with a Google AI programming course? DeFi makes as much sense as building homes out of butter. Excellent video. Be well.
Thanks for the critical eye and the objective view.
Love your content - really enjoy the infrequent clips to emphasise points
Nice content! Few years back i was assistant to a wealthy pen artist and within the short period i worked with him i observed that he had quite
a chunk of investment everywhere, stocks, crypto, dividend investing to name a few, so he had revenues coming in from all angles. And in a year
his worth doubled. With this i learned that the rich stay rich by investing.
i agree with this but the problem now is getting to make the right investments, Lots of people tend to lose their money while investing thereby making them lose interest and also end up discouraging other individuals around them.
I think the major challenges investors face may range from controlling impulsiveness to the frail of compulsion. Most newbies and would-be investors often undermine and most often neglect the importance of technical analysis with regards to investing. Technical analysis overly predicts the movement of asset prices regardless of what is happening in the wider or broader market. Essentially, the process involves studying the paths of a particular asset movement in the past so as to establish a sustainable pattern that can be used to predict future movements or better still get an investment advisor who'd guide you and help you manage your portfolio just like my boss back then, He was working with Mrs. kate Tastrom and i would bet he still does. I can boldly recommend her because i've witnessed her performance first hand. She's the real deal.
How can I get across to her?
@@michaeleric4432
She's on tel 'gram
i've come across her on a cnbc broadcast
Patrick Boyle is not only a great source of finance information, he may be one of the funniest people on TH-cam. I think I've laughed out loud at his videos more than any other in general...
Even though I am part of the participation generation I do enjoy your dry humor
Beautiful video and I wanna thank you Patrick for all the free content that he provides us.
But please use a better microphone 😢
The microphone seems fine, it's an echo from the room he's filming in. He seems to film wherever he can, he seems to move around a lot.
@@whocares5946 yes I noticed that too, but I thing that a normal small microphone (the one that you can hang near your neck) shouldn't be difficult to bring everywhere.
Or maybe I'm just underestimate the effort :/
He is on remote location, so I suspect he is using his phone to record this. It's a minor thing.
There have been too many fakefi projects. CEFi has caused all the recent problems. We need these companies to be regulated.
Good messaging. I’m in Crypto and they are all real and valid concerns. I would suggest looking into treasuries around the world implementing cbdc: Australia, uk, us and Europe. It’s on their websites. Defi in its present form is clucky and needs work. Trust in MetaMask is like putting a wad of 50’s on your hand and asking a shop how ever many they’d like to take. Some tokens do have a limited supply and these are the ones i prefer. Ada, btc and soon eth will have a limited supply but at the moment it doesn’t. Look at iso20022 xrp, xlm, algorand, hbar being used for bank settlements. Crypto has uses for international payments. Thanks Patrick. 🙏Awesome video once again.
Patrick filming this in the meeting room again.
'because crypto" -- Patrick
"crypto has been speedrunning all of financial history." This would have less impact with someone else's delivery.
They never heard of $HEX. No admin keys. Centralised ownership equals best price performance