Crypto Continues to Crash Hard
I dont, but i know someone close to me who did and lost uh an unfortunate amount of yeah on the recent. I feel like its a little shot and freud, and i shouldnt feel good about anybody losing money, especially nowadays, but bitcoin went below 20 000.. Its actually gone back up a little bit. It actually got down to about 18 000. Over the weekend, holy cow, wow, holy cow – and you know the scary thing about this – is that people who really should have known better got into this thing in a big way, and you know a lot of them got burned. Thats, why? I shouldnt say: oh isnt to me its like, oh yeah, bitcoin went down what a surprise. You know you should have known better, but i feel bad for people who you know saw matt, damon, saying courage, favors the brave and they said well im going to be courageous and buy bitcoin. And, of course, if you hold stocks right now, uh your 401k is probably not doing too well either um. We dont look at that leo yeah, you dont, look at the numbers when they go down thats right when they go up just keep pumping the money in there you know every paycheck and and then you know, hopefully hopefully at some point in the future. There will be enough in there to uh. At least you know, give you a little bit of extra spending money as you keep working until you drop down yeah right.
Well, i think you know, i i think the scary thing about the markets right now are stocks. Are down bonds are down kryptos down, like you know, theres, you know every everythings down in the past. When stocks went down, people would buy gold, and i thought bitcoin would be like that. Right like that, would be. Oh, a lot of people thought that it would be like gold, but you know, unfortunately, you know at least gold. You know you have something physical that you know has some well, but lets be fair. The industrial value of gold comes nowhere near the price of gold. I mean yeah, you could, if, if you had some gold bricks in your basement, you could probably find somebody to buy it to make. You know expensive stereo dongles, but its not like its going to be whats the price of gold per ounce, its a lot more than the industrial value of it, so gold is probably similar to bitcoin in that respect, right uh! Well, i mean i mean at least it has some industrial value bitcoin. You know its nothing yeah, you know its its a scam, yeah uh, the current, i think, theres, the future guys thats. What were all forgetting. I i guess i have to be the the web. 3 defender – and you know oh good, we found one. Finally, finally well, i i think there is you know there is some utility value in um in cryptocurrencies.
Broadly, you know in the idea of like greatly improving cross border payments, taking a lot of cost out of the equation: um, not necessarily with bitcoin, because bitcoin is one of the least efficient, uh cryptos out there. The problem is that the speculation value – the you know the quote: unquote: investment value, but really its speculation. The speculation value of these cryptocurrencies is at complete tension with any utility, the more volatile and hence you know short term money. Making these currencies are the less useful. They are for payments right, as el salvador has learned uh to their chagrin, they made bitcoin last year, their uh state currency, replacing the dollar, and now they cant pay their uh debts. Um, i shouldnt. I should make it go ahead. I think they made it legal tender, but i dont think they completely replaced the dollar. I think they made it parallel as an alternative to the dollar. So you can use the dollar or use use bitcoin, but it didnt completely replace the dollar. They bought a significant amount of bitcoin, which was also a little bit of a mistake. I shouldnt laugh but theres, so many bitcoin bros, especially those bitcoin billionaires, going around saying you see you see its the future theres so much hype around it. I i guess i feel terrible for anybody. Whos lost money uh, you know because i dont know i doubt it will come back to its former glory days.
Maybe it will um, but i think maybe some of the bloom is off the road. So i feel terrible for anybodys lost money but at the same time im glad that its kind of taken some of the air out of the market. Ironically, jack dorsey, former uh twitter, ceo founder one of the founders of twitter, announced web 5.0, which is web 2.0 plus web 3.0, based on bitcoins blockchain just a couple of weeks ago, thats not looking like a good choice right about now, uh coinbase its time for Web 6.0 yeah – maybe maybe we got to skip ahead. Whats theres. No, are you? You said youre going to defend web 3. What is good about web3 uh, i mean theres a limited set of circumstances where a blockchain, which is you know, basically a write. Only database thats thats, distributed on the internet um, is useful and its generally, where you dont want to have one party maintaining a database and where you you know like where you dont, want to have to trust someone right um, like a bank yeah. Exactly i mean the the irony is that weve built up all these systems that do rely on trust and people are kind of used to it and theres even a kind of a thinking in the uh. You know in the crypto world that well like if you get caught by a scam, you didnt do your research right, its your fault uh, because you shouldnt have to trust yeah and who do you blame right, theres, no bank to complain to yeah exactly um.
So i dont know you know to your point leo i i am very sympathetic to people who saw a misleading, ad and kind of you know and kind of went for it based on you know, based on those false premises. Im, you know im also sympathetic to people who say: hey, the existing system is uh. You know i belie you, know: people who believe the existing systems rigged against them – and you know dont want to you – know: dont want to invest in stocks. Theyre, certainly not getting any kind of interest on their bank deposits um and you know and see it as a way to yeah and thats exactly the situation. This person close to me, was in yeah didnt, believe you know, thought the system was corrupt and broken and and basically rigged against normal people, and you know, was reading reddit forums and, even even when i tried to explain you know the the technical stuff and the Limitations uh, you know, i mean theres. As you said, i agree that theres some some theoretical you know really interesting use cases for blockchain and crypto, but when you actually start looking at it, as you know, as a store of value, you know it becomes way more problematic. You know, try and actually trying to use it and certainly nobody. I dont think anybody has come up with a really viable way of making it usable as a store of value and when, when you, when you look at the world around you today and and see all the corruption you know it it, it is very enticing to Jump into something like this, and you know hope that you know, maybe this is going to be a solution to the problems that we have part of the eye.
Opener, though, is its not corruption. Free the world is full of corruption, its full of scammers, its full of bad guys and nfts. It turns out uh. Not only is it centralized pretty much all on open sea uh, but if openc decides as they did with uh the board ape uh. Oh, were not gon na sell anymore, you cant thats, it youre done so it is centralized and there are plenty of scammers out. There have found ways to steal, nfts uh to fish nfts. I i mean i, i feel like its its the best, its the worst of all worlds combined, but it does have this utopian promise of something better. I just dont, i just dont, see it happening, theres, also, the environmental impact which we cant ignore. I know that banking has an environmental impact as well, but uh. You know these proof of work. Cryptocurrencies right now are not exactly the thing we should be doing. I think, as the as the world gets hotter and hotter i mean my one issue – is that people are describing them as currencies, but really what theyre being used as right now is just for speculation. Theyre tulip bulbs, yeah theyre tulip bulbs that were all better except they dont look pretty in the spring yeah. Yes, theres, nothing to hold yeah to your point, sam at least you could play in a tulip bowl, even if you paid five thousand dollars for it. At least youll get a tulip, maybe not if your tulip is held in a vault under the swiss alps, maybe not uh anyway.
I dont i dont want to pile on uh. If you, if youre holding bitcoin, i have almost eight bitcoin, but i cant access it, because i forgot my password and its just sitting in my home, no yeah its an old story. Everybody knows this story, thats, no, actually, not all! No! Well, maybe oh! No! If but see, this is always a problem with even with stocks. If you knew when the peak was, it would be. Oh, no, you should have sold leo in a 60 000 because its never going to be there again, but is it if i sold it today at 20 000 and it goes to 60 in a year? Did i do the right thing so, its better its locked away? I didnt buy them. There were donations for a while. You know we. We have a tip jar or something on the website for a while. I had a qr code for a bitcoin wallet and so yeah. No, i didnt buy them theyre. They were able to send you eight bitcoin. Well, this is in the uh, the last one was twenty feet. This was when they werent worth anything and they werent even sending whole bitcoins. They were sending fractionals, but enough people did it. It was 7.85 bitcoin and i can see it its in the i have the wallet i just have to remember the passphrase to unlock it. Itll come to me Laughter, i dont feel as bad, and i mentioned this before too, and i apologize if youre hearing me repeat, i dont feel as bad as steve gibson, our security guy.
When bitcoin first started, he thought itd be fun to set up a bitcoin miner. Next morning, literally next morning, 50 bitcoin came out of it early on. It was easy to do that on just a pc, so he put it on. He put the wallet on a hard drive forgot about. It later erased the hard drive, so he had even by todays standards. He had a million bucks um. You know he had three million dollars at the peak that just never he erased and thats the other by the way, no central bank. Nobody to complain to you lose you forget your password, you forget your you erase your hard drive. You lose your wallet, you use a custodial wallet which a lot of people did at mount gox and other places youll lose it aint. Nobody to complain to, of course, if you set fire to a pile of you, know: paper bills, the banks, thats true thats, a good point, thats a good point. Yeah, but yeah i mean the the the non reversibility of cryptocurrency transactions. But by and large there are some there are some that are reversible uh, but you know thats a big problem and people havent really gotten their heads around the customer service implications of that. Just the you know like if theres transaction fraud um, i havent even heard people talk about that issue right as much, which i think is a big issue in terms of making it mainstream right.
At least jake paul is broke now, thats all im just happy about that. Thats all okay theres no way hes broke. He probably has marginally less money. Yeah, i mean theyre still worth 20 000 unless he bought it at 30. or is he? Is he leveraged if he bought it? Oh, he could be, he could be. He apparently, he put all the thing that brings jake paul down ill, be very surprised what a world i you know, but i think that i think that a lot of what were seeing like, why is everything kind of collapsing at once its because youve had a Ton of leverage uh into this market and all of those leveraged bets are unwinding at once right and its just enormous selling pressure, and by the way this picture is why there are people, maybe me who have some schadenfreude about all that theres jake, paul literally rolling In money and uh, you know thats why people dont, like bitcoin bros right, theres, a you know, and so i feel bad. Anybody lost money. Im, sorry, im, sorry jake uh, at least you have your boxing career to fall back on. Uh. Is that his brother? Oh, is it logans that i cant keep track of him? I dont know theres my son, who is hip and with it tells me theres one good, paul and one bad paul. I dont know which is which inside of you, there are two pauls Laughter.
Jake paul did blame biden for the fall of bitcoin, so im thinking, oh so theres that yeah, maybe hes the maybe hes the bad paul uh all right uh. We were not gon na go on and on bitcoin uh. I hope it goes back up.