![]() A lot of people in the public have gotten hurt. And we’ve seen that in the last year with the collapse of most of these tokens, a lot of them are revealed to be outright scams. This is a technology that has an overwhelmingly malign influence on the world, all for a set of theoretical upsides which never seem to match reality or bear any fruit. So crypto really is a solution in search of a problem. Well, it’s the conclusion I’ve come to over the last couple of years, when I’ve looked at the space and the impact it’s having on everyday people, on the tech industry, and on the world at large. So what is it that led you to that pretty strong conclusion, that cryptocurrency as a whole is a giant scam? Stephen Diehl A pitch perfect scam for the post-truth era of social media where trust in institutions and experts is at an all-time low. And I want to just read the pretty emphatic opening sentence to your book Popping the Crypto Bubble:Ĭryptocurrency is a giant scam, although a complicated scam that uses technobabble, heterodox economics and populist anger to obfuscate its functioning. You’ve been writing about cryptocurrency for a while. This interview has been edited for grammar and clarity. We also discuss the complicity of financial journalists in promoting con artists as altruistic geniuses who can be entrusted with one’s retirement savings. In this episode, Stephen discusses the credulity that allows con artists like Bankman-Fried to flourish in the crypto industry, and that dupes supposedly savvy investors into believing in the digital equivalent of magic beans. He and his co-authors show how the history of financial bubbles and manias helps us understand crypto-hype today. Diehl is the co-author of the new book Popping the Crypto Bubble, an accessible explanation of how cryptocurrency works and why it’s a terrible idea. Robinson recently spoke on the Current Affairs podcast to Stephen Diehl, a longtime critic of crypto who has been warning for years that crypto assets can suddenly implode and that unregulated crypto exchanges like FTX are a terrible place to keep your money. To explain what happened, and why we keep seeing spectacular frauds in the crypto industry, editor-in-chief Nathan J. He plans to give away at least 99 per cent of what he earns as fast as he can.” … Bankman-Fried offers an alternative narrative, focused on how crypto can do good and give ordinary people control of their money. … Although Bankman-Fried has a knack for winning converts, crypto is still assailed by critics who see the sector as a financial perpetual motion machine, something close to a Ponzi scheme, that survives by sucking in new money. And the week before our lunch, he hosted a conference where he interviewed Bill Clinton and Tony Blair, dined with Katy Perry and Tom Brady, and was pursued for selfies by admiring fans. In March, Goldman Sachs chief executive David Solomon met with him on Bankman-Fried’s Caribbean home turf. His company is backed by blue-chip investors including BlackRock and government pension funds. In just three years, the success of FTX has catapulted him to fame and a roughly $24bn personal paper fortune. Overnight, Bankman-Fried saw his fortune and his company wiped out, and he is now under criminal investigation. An excerpt from the Financial Times from May of this year gives a sense of the aura that surrounded Bankman-Fried and his firm before their sudden collapse: Its CEO, Sam Bankman-Fried, had been called “the next Warren Buffett” and was a Democratic mega-donor as well as a major funder of the “ Effective Altruism” movement. One of the world’s largest cryptocurrency exchanges, FTX, recently imploded spectacularly.
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