to crypto or not to crypto - part 3

so now we have a crypto saga... some dude who owns one of the largest crypto exchanges turns out to be a fraud. so here we have the 2008 crisis once again. it is the equivalent of having one of the most established investment banks collapse. not saying that this exchange is a gazillion years old. just saying that it is one of the significant players in the infrastructure for crypto currencies. 

does that mean crypto currency would lose value? 

well... to answer that question, you have to ask yourself, do we still require an alternative to fiat currencies?

in 2008, the fact that an investment bank collapse does not mean property is a bad asset class. it means the people who give out loans for properties should be selective. loans should be given out to people who are able to repay. it means that banker should not sell the risky loans to retirement funds by getting the rating agencies to say they are non risky loans. it means that government should not have bailed bad investment banks for making bad decisions without stating the clear criteria for bail out - ie they should not pay themselves shitload of money for f*cking up.

so, today, the fact that a fraudster caused the exchange to collapse does not mean all crypto currencies are worthless. it means (hopefully), that once the root cause of the collapse has been identified, that it would be prevented from happening again. it means (hopefully), that the other affected exchanges, if they survive, would have controls in place to prevent the same from happening again. it means (hopefully) that the worthless coins that may not be able to hold its worth would go away... at least for awhile.

but i suppose that is just history repeating itself. it always start off with the right intention. somebody want to enable something wonderful. then greed kicks in. someone figured out how to work the system. gets everybody into trouble. people wake up and learn from the mess. comes up with controls. it is peaceful for awhile and then greed kicks in again. and history repeats itself in different forms. nothing new really.