tech

Crypto clients beg for their cash back after lender's crash

37 Comments
By Joshua MELVIN

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37 Comments
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Well they now could still their hunger for easy money and just diversify their profitable virtual portfolios with some highly promising NFT. irony off

12 ( +13 / -1 )

On many sites, experts always advise to hold your crypto in hardware wallets and not on exchanges for this reason. So many exchanges/lenders/custodians have collapsed since the start of crypto.

4 ( +5 / -1 )

They should of bought lottery tickets,some person is 1.3 billion dollars rich from Friday Megamillion drawing

-13 ( +1 / -14 )

How can I feel so sorry for them, when they “knew” there were risks. They knew it! But they were greedy. Very greedy! They laughed in the face of those who never invested in crypto and watched the profits roll in, as bit coin etc rocketed to a new hight.

One said he borrowed money to invest in crypto. That says it all.

another invested their life savings in this. Seriously! if the knew enough to invest in crypto junk, then they knew to not put all their eggs in one basket.

and if they didn’t know. Then they shouldn’t have done it anyway.

They could have gotten the best advice for free from the two best financial advisors in the world Buffet and Munger for free. And that would have been the best investment they’d have ever gotten. If they’d just checked!

11 ( +12 / -1 )

Crypto produces nothing, makes nothing and does nothing. Until it does, I’d stay out! Tulips, and pyramids come to mind.

some really are day dream believers through!

12 ( +13 / -1 )

"I knew there were risks,"

Well then, there you go. Crypto idiocy has made buying replacement/upgrading graphics cards impossibly expensive...I'm sure a lot of computer enthusiasts would like some money back too.

9 ( +9 / -0 )

"I knew there were risks," said a client whose letter was unsigned. "It seemed a worthwhile risk."

...

Others reported heavy stress, lack of sleep and feelings of deep shame for putting their retirement savings or their children's college money into a platform that was far riskier than they knew.

Sayz it all.

Ponzi schemes, quick-rich schemes, gambling, etc come to mind. Sorry but when that much stupidity and greed are involved is compassion a waste.

6 ( +7 / -1 )

The company owed $4.7 billion to its users, according to a court filing earlier this month, and the endgame is unclear.

Oh I think it's pretty clear.

5 ( +5 / -0 )

All I wanted to do was get rich quick and cash out before those who “invested” after me got the rug pulled out from under them. It wasn’t supposed to happen this way! /s

6 ( +6 / -0 )

'Not your keys not your crypto' ; I don't feel sorry for them if they hadn't been too lazy to learn how to self custody their assets or too greedy to fall for the insane APY Celsius offered they would still have their money. They deserve what's happening to them.

1 ( +1 / -0 )

"I knew there were risks," said a client whose letter was unsigned. "It seemed a worthwhile risk."

That is the whole thing, people thought they could handle the risks because of the huge profit they were supposed to have, many didn't properly research the investment and how unprotected their money was.

As always, if something seems too good to be true most of the time that is exactly what is happening.

6 ( +7 / -1 )

'Not your keys not your crypto'

while true, this site was offering returns from using deposits to create loans, so you kinda need to deposit crypto with them.

As for all the I told you so's and other sage advice, just remember most of these people would have been late to the party investors chasing the big returns that others had already made. Common sense goes out the window when greed takes hold.

2 ( +2 / -0 )

zero sympathy.

combination of greed and scam.

2 ( +2 / -0 )

Capitalism in all its nasty, naked glory…,

4 ( +4 / -0 )

Abe234Today 09:17 am JST

Crypto produces nothing, makes nothing and does nothing. Until it does, I’d stay out! Tulips, and pyramids come to mind.

some really are day dream believers through!

Crypto currencies can be extremely useful when used as intended.

I am working with a guy in Belarus, crypto currencies allow me to continue our work relationship despite the political climate.

-1 ( +1 / -2 )

So a fake currency, not backed by any central bank, completely unregulated, that you can’t really buy anything with and who’s value relies on celebrity endorsements and an unending influx of newer investors (that’s called a pyramid scheme for those of you playing at home) collapsed?

Wow, who could possibly have seen that coming? (Raises hand and bounces up and down ala Hermione Granger) Oh, Warren Buffet, Sachs, Diamond and a hoast of others.

It’s a fraud that benefits only those seeking to hide currency from government regulatory authorities (drug smugglers, traffickers, cyber terrorists) and speculators.

But what do the crypto evangelicals say? (Crickets chirping) Well, maybe they are planning their next Meme stock trades.....

0 ( +3 / -3 )

"Celsius has one of the best risk management teams in the world. Our security team and infrastructure is second to none," the firm wrote on June 7.

Those so called "Risk Managers" are clearly not up to scratch.

3 ( +3 / -0 )

Never invest/gamble with money you cannot afford to lose.

Crypto is no different to any other asset. It will go up and down. Complicating your holding/access (as in this case) exponentially increases your risk. That is usually unwise.

1 ( +1 / -0 )

Poor people. They got screwed by this organization.

This is why I didn't ever gamble on cryptocurrencies - to high risk for my liking.

1 ( +2 / -1 )

EppeeAug. 2  07:36 pm JST

Abe234Today 09:17 am JST

Crypto produces nothing, makes nothing and does nothing. Until it does, I’d stay out! Tulips, and pyramids come to mind.

some really are day dream believers through!

Crypto currencies can be extremely useful when used as intended.

I am working with a guy in Belarus, crypto currencies allow me to continue our work relationship despite the political climate.

I agree up to a point. I think there is a use for them, but as cash.I'm not so sure.

It may allow you to continue a work relationship despite the political climate, but then again, can't this person also just do a normal transfer of cash. The system is in place, it can be transferred in minutes. Eg WISE.

Unless it is to get around some legal issue I can't see no good reason that a person in Belarus can't transfer the funds to a normal bank. Since the currency is so unpredictable people can't set their prices constantly. The currency isn't back by any central bank and if it goes bad then who's going to compensate them.

The block chain, which is what we are really talking about, could be used by central governments to create its own dollar crypto or yen crypto backed by their governments with protections in place. The bit coin for most is probably a scheme to pump and dump, and the only reason to have it is to pass it on to the next person for a profit who in turn hopes to do the same. Some crypto may survive but I think its a similar to the dot com bubble. Anything with a dot com on it made millions, and it seems that history is repeating itself with something something crypto. Not every one needs crypto!

0 ( +1 / -1 )

Crypto produces nothing

Neither does paper money. And just like paper money, not producing anything in and of itself doesn't mean there isn't a good reason for it to exist.

makes nothing

Same as above.

and does nothing

That's where you're wrong. Cryptocurrencies allow for the common man to start to take back control of their money abnd the data associated with it purchasing trends, cutting out bank influence. Banks have set up the economy such that all financial transactions are seen by the bank, and subject to government influence. Cryptocurrencies allow the common man to manage their own money, without the banks being able to build a financial profile of that person that they can use to sell to marketers, or to prey on you to use their services so they can make more money.

FX trading of cyrptocurrencies is risky, but at the moment, it's how cryptocurrencies get into mainstream use. People used to ask what they were, now people discuss how they work. Over the years, as they become more mainstream, and as some cryptocurrencies take hold as the defaults, the people will have less and less dependency on the banks, and we will all benefit from that. Banks have preyed on the people through our dependency upon their services for too long. Cryptocurrencies will revolutionize the way humans manage their money.

But for now, they remain primarily a means of FX trading.

-1 ( +2 / -3 )

The only thing worse than crypto are bankers and central bankers.

2 ( +2 / -0 )

Hackers just drained $200 million from the crypto startup Nomad. Nice start, huh?

0 ( +0 / -0 )

The golden rule for investments...

Do not get into a business that you do not know well and only invest money that you are willing to lose and do not go bankrupt...

Like these cryptocams for example..

3 ( +3 / -0 )

*Cryptoscams...

3 ( +3 / -0 )

Abe234Today 01:47 am JST

I agree up to a point. I think there is a use for them, but as cash.I'm not so sure.

It may allow you to continue a work relationship despite the political climate, but then again, can't this person also just do a normal transfer of cash. The system is in place, it can be transferred in minutes. Eg WISE.

No, everything has been blocked, no international transfer, no wise, no PayPal, etc. They are all companies from the USA.

1 ( +1 / -0 )

"Paper" money, when backed and regulated by a reliable Central Bank is a trusted store of value and wealth. crypto " currencies "? Not so much.

So there's that.....

1 ( +1 / -0 )

Good luck with that

0 ( +0 / -0 )

Quote: "Paper" money, when backed and regulated by a reliable Central Bank is a trusted store of value and wealth.

The Bank of England is a 'trusted store of value and wealth' but the Brexit referendum saw sterling dip 20%. Everyone with savings in sterling (that's most of the British population) lost one fifth of their wealth. National currencies are vulnerable to the idiocy of politicians and electorates. The Rouble dipped too, but went back up. If you want financial security, you may be living in the wrong decade. Or on the wrong planet.

A digital currency that, on purchase of units, banked the cash, equally, in a mixture of the most stable currencies, may be best insulated against sudden loss. We are more likely to get digital currencies banked in one currency: US$, JPY or Euros. A digital currency should be fully underwritten by the banked real-world cash that buys units of it. No 'mining' required, with the ecological hit that causes, and no fluctuations independent of those of the underwriting currency/ies.

0 ( +1 / -1 )

@Eppee

Crypto currencies can be extremely useful when used as intended.

I am working with a guy in Belarus, crypto currencies allow me to continue our work relationship despite the political climate.

With all respect, this reads like you are circumventing sanctions which...is illegal. As such, I would not be too talkative about it in public...

...when used as intended.

Again, this could be read as: "crypto being intended to be used to circumvent sanctions". You may want to re-phrase all of the above...

@strangerland

Cryptocurrencies allow for the common man to start to take back control of their money abnd the data associated with it purchasing trends, cutting out bank influence. Banks have set up the economy such that all financial transactions are seen by the bank, and subject to government influence. Cryptocurrencies allow the common man to manage their own money, without the banks being able to build a financial profile of that person that they can use to sell to marketers, or to prey on you to use their services so they can make more money.

FX trading of cyrptocurrencies is risky, but at the moment, it's how cryptocurrencies get into mainstream use. People used to ask what they were, now people discuss how they work. Over the years, as they become more mainstream, and as some cryptocurrencies take hold as the defaults, the people will have less and less dependency on the banks, and we will all benefit from that. Banks have preyed on the people through our dependency upon their services for too long. Cryptocurrencies will revolutionize the way humans manage their money.

But for now, they remain primarily a means of FX trading.

You are definitely right on the part about financial institutions (like so many other trading counterparts or intermediaries both private (i.e. corporations) and government) gathering insane amounts of data on us and our transactions. TBH, this is a concern to me as well...

But crypto is also an unregulated wild wild west where anything goes and security takes a backseat over "growing the business".

To give a very specific example (whether you believe me or not is us to you). A few years ago, when the J-gov wanted to become a crypto-powerhouse (as well as do some cleaning after the mount Gox and whatsis Coincheck(?) failures in Japan, did the J-Finance Ministry do a review of all crypto companies in Japan (I think there were less than 20, so no biggie). More than half had so severe structural security fails that in some cases suspension of disbelief was even required (e.g. one case where the CEO had literally all powers over all customers accounts(!) ).

The J-gov then announced it would roll out a framework under which all companies would need to operate, hence stop their (ahem) "self-regulation". Pretty much half the companies left Japan within months, the other half scrambled to find Anti-Money Laundering officers. How do I know that? Because having experience and a background in AML I got bombarded by all my recruiters for all the (same) positions at the same companies again and again and again. I passed over all the offers again and again and again.

Then, the J-gov backed down, essentially as they could not...come up with a framework to be rolled out and...asked the industry to, well..."self-regulate" which BTW was the original problem, hence going full circle but expecting a different outcome...(sigh)

Funnily enough, literally overnight the e-mails stopped coming in. I checked with friends and former colleagues with an AML-background, same story: bombarded for weeks, again and again and again then e-mails stopped coming in, literally falling off a cliff.

The industry was not going to crank up security anymore as it was not an "official" requirements now that they could come up with their own "framework"...

Banks and financial institutions are regulated. As such, there is a minimum guarantee and securities around how they can and are allowed to operate. Nothing is perfect, that is when scandals go bust and fines are dished out. They are indeed in a position of power, but regulated. I guess that "yes" as they are providing a set of services that nobody else is, they are in a situation of monopoly of sorts and can therefore "prey" in a sense on people relying on those services. But saying that the crypto industry is different and not preying on its customers is a bit rich in my books...

Not sure how many people use crypto for "FX trading", but the main impression I have, is that to simply too many people (with quite a lot at the bottom of the food-chain) it is supposed to be nothing more than a get-rich-quick-by-being-(ahem)-"smarter"-than-others-scheme and that the industry, more than having people "discuss how crypto work" is currently having people "shout and cry their eyes out about how getting their (lost) money back"...or getting regulator's help to do so...(after being up and roaring about giving the man the middle finger and...escape regulation in the first place...)

Over a decade into existence do crypto still look like a niche-product. Those who made money out of it mostly bailed out or invest much less in it, while those who lost everything are forced to bail out by default leaving an ever-shrinking pool of potential investors or users. While there is a very large pool of gullible people or let's say "people interested in rare types of ventures" in this world, it is (1) by no means infinite and (2) it has already been exploited a lot, so...

Still, the above is not to say that the underlying technology could not be made (a better) use of.

1 ( +2 / -1 )

blueToday 10:20 am JST

@Eppee

Crypto currencies can be extremely useful when used as intended.

I am working with a guy in Belarus, crypto currencies allow me to continue our work relationship despite the political climate.

With all respect, this reads like you are circumventing sanctions which...is illegal. As such, I would not be too talkative about it in public...

What sanctions do I circumvent ? I am not a citizen from any countries applying those ... The fact is we previously used services from the USA and USD to do our transfers, which we cannot anymore, that's all, we're using another service.

0 ( +0 / -0 )

The Bank of England is a 'trusted store of value and wealth' but the Brexit referendum saw sterling dip 20%

A valid point and point taken. As you say, even a government currency backed by a central bank can lose value if the government makes bad policy decisions. As you correctly point out, BREXIT is a prime example of this

At the same time, making good decisions can (sometimes) recover that value. In any event the government can usually be held accountable (full disclosure: offer not valid in Russia, Venezuela or China).

But IN GENERAL, a government backed and regulated currency (paper or digital) is vastly more desirable than a made up “currency” that is not a store of value or a means of exchange, but rather a means of tax evasion and/or speculation.

That part of my argument remains unchanged, but I thank you for your insight and commentary.

2 ( +2 / -0 )

The arguments comparing the value of crypto currencies to "paper money" are moot.

Crypto currency is only ever worth the value of the paper money it can be converted back to.

3 ( +3 / -0 )

StrangerlandToday  02:24 am JST

Crypto produces nothing

Neither does paper money. And just like paper money, not producing anything in and of itself doesn't mean there isn't a good reason for it to exist. 

makes nothing

Same as above.

and does nothing

That's where you're wrong. Cryptocurrencies allow for the common man to start to take back control of their money abnd the data associated with it purchasing trends, cutting out bank influence. Banks have set up the economy such that all financial transactions are seen by the bank, and subject to government influence. Cryptocurrencies allow the common man to manage their own money, without the banks being able to build a financial profile of that person that they can use to sell to marketers, or to prey on you to use their services so they can make more money.

FX trading of cyrptocurrencies is risky, but at the moment, it's how cryptocurrencies get into mainstream use. People used to ask what they were, now people discuss how they work. Over the years, as they become more mainstream, and as some cryptocurrencies take hold as the defaults, the people will have less and less dependency on the banks, and we will all benefit from that.

The common man won’t be able to take back control because of crypto.

which government is going to give full control of their currency to the public? The central banks will keep that control.

crypto doesn’t produce anything at all. I can’t buy a coffee, loaf of bread, or even a bowl of rice. If anything the digital currency would only make it easier for a government to see everyone’s finances.

crypto is being marketed as an asset similar to gold, silver, while these can be sold and made into products crypto isn’t any of these things.

However the tech will be used to allow the common man to use a digital dollar, euro or yen, but with that, people won’t be able to keep cash in their house. Apart from that digital currencies have been proven to encourage even more spending by reducing the visual, emotional relationship with money, by reducing the common man’s thinking time to a swipe of an iPhone.

Banks may not build that profile but the company/government that deals with your crypto will have that profile.

i believe China is rolling it’s own version of a digital currency.

1 ( +1 / -0 )

Thousands of Solana wallets were just hacked. Crypto continues to be a flawed fraud filled with coordinated pump and dump schemes and stolen money put up to buy numbers.

1 ( +1 / -0 )

Investing n "Crypto Currencies/Tokens" is essentially a game of "Chance". And should be treated as such. It is a sad fact, that there are so many folks who have been led astray by false information about this honest fact.

When its value goes up... you don't know why, but you're happy. BUT when it's value goes down, and you question why - you complain and want your money back... sounds like Stupidity to me.

As for placing your trust in an individual company to look after your money... when it has no state guarantee for deposits.... then seriously, if you put all your Life savings into that Company, then you are a dumb a55... Didn't your Mother tell you "not to put all your eggs into one basket" ?

I suspect in some cases, sheer Desperation to make some money is at play here, but they have been sadly led into a false sense of Security.

1 ( +1 / -0 )

Investing n "Crypto Currencies/Tokens" is essentially a game of "Chance".

How does this differ from any FX trading?

And should be treated as such

The same as any FX trading.

It is a sad fact, that there are so many folks who have been led astray by false information about this honest fact.

No they haven't. They knew it was a risky investment. Risky investment can come with high rewards. They played the game, same as anyone who plays a high risk investment. So many won, and some lost.

Oh dear, I hope cyrptocurrencies didn't destroy your world view by exposing the workings of the world to you. It would be sad if you were only figuring it out now, because of cryptocurrencies.

-2 ( +0 / -2 )

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