# Sam Bankman convicted 2023-11-02 (was living with parents, then jail). Is BTC and cryptocurrency busted too? **URL:** \ **Category:** In My Humble Opinion\ **Created:** [December 23, 2022, 8:10pm UTC](https://boards.straightdope.com/t/sam-bankman-convicted-2023-11-02-was-living-with-parents-then-jail-is-btc-and-cryptocurrency-busted-too/977019 "2022-12-23T20:10:03Z")\ **Posts on this page:** 20\ **Page:** 2
**Author:** ![RickJay](https://avatars.discourse-cdn.com/v4/letter/r/bb73d2/32.png) [@RickJay](https://boards.straightdope.com/u/RickJay)\ **Post date:** [December 24, 2022, 2:11am UTC](https://boards.straightdope.com/t/sam-bankman-convicted-2023-11-02-was-living-with-parents-then-jail-is-btc-and-cryptocurrency-busted-too/977019/21 "2022-12-24T02:11:17Z")
> [@DocCathode](#): > > Bitcoin is a bubble. Bubbles burst. For a lot of people, it burst long ago; Bitcoin is currently only a quarter of its peak value. ---
**Author:** ![RickJay](https://avatars.discourse-cdn.com/v4/letter/r/bb73d2/32.png) [@RickJay](https://boards.straightdope.com/u/RickJay)\ **Post date:** [December 24, 2022, 2:12am UTC](https://boards.straightdope.com/t/sam-bankman-convicted-2023-11-02-was-living-with-parents-then-jail-is-btc-and-cryptocurrency-busted-too/977019/22 "2022-12-24T02:12:56Z")
> [@dolphinboy](#): > > ```auto > Transaction speed. > Transaction costs. > Accessibility. > Security. > Privacy. > Transparency. > Diversification. > Inflation protection. > > ``` I would be fascinated to see basically ANY of these defended, and in some cases, even explained. How is “Diversification” an advantage of crypto? Transparency in what sense? ---
**Author:** ![Eonwe](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/eonwe/32/240_2.png) [@Eonwe](https://boards.straightdope.com/u/Eonwe)\ **Post date:** [December 24, 2022, 2:27am UTC](https://boards.straightdope.com/t/sam-bankman-convicted-2023-11-02-was-living-with-parents-then-jail-is-btc-and-cryptocurrency-busted-too/977019/23 "2022-12-24T02:27:35Z")
> [@RickJay](#): > > I would be fascinated to see basically ANY of these defended, and in some cases, even explained. How is “Diversification” an advantage of crypto? Transparency in what sense? Ok, you are clearly not the target market. Good day, sir!! ---
**Author:** ![Chronos](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/chronos/32/134_2.png) [@Chronos](https://boards.straightdope.com/u/Chronos)\ **Post date:** [December 24, 2022, 2:35am UTC](https://boards.straightdope.com/t/sam-bankman-convicted-2023-11-02-was-living-with-parents-then-jail-is-btc-and-cryptocurrency-busted-too/977019/24 "2022-12-24T02:35:34Z")
> [@dolphinboy](#): > > The advantages of cryptocurrency far outweigh the real chance of losing it all to nefarious companies. The primary advantage of crypto is that you don’t need to deal with companies, nefarious or otherwise. Which advantage people promptly ignore. The only difference from “real” currencies is that the banks that people use are completely unregulated, and so most of them turn out to be thieves. ---
**Author:** ![aceplace57](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/aceplace57/32/3500_2.png) [@aceplace57](https://boards.straightdope.com/u/aceplace57)\ **Post date:** [December 24, 2022, 3:38am UTC](https://boards.straightdope.com/t/sam-bankman-convicted-2023-11-02-was-living-with-parents-then-jail-is-btc-and-cryptocurrency-busted-too/977019/25 "2022-12-24T03:38:13Z")
The risks and rewards of investments has always varied… I have investments in CD and Bonds. Most is in Blue chip stock. My broker does a good job managing my account. I don’t expect a quick return. I’ve had the account for 25 years. It’s my retirement. The money in Cd’s is more liquid. I could use it for sudden repairs or emergencies. My last vehicle was bought in 2017 after a CD matured. I was willing to accept some risk in an investment with this mature CD. But I don’t have enough confidence in cryptocurrency. Especially with Bankman’s fraud charges. ---
**Author:** ![CookingWithGas](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/cookingwithgas/32/485_2.png) [@CookingWithGas](https://boards.straightdope.com/u/CookingWithGas)\ **Post date:** [December 24, 2022, 4:03am UTC](https://boards.straightdope.com/t/sam-bankman-convicted-2023-11-02-was-living-with-parents-then-jail-is-btc-and-cryptocurrency-busted-too/977019/26 "2022-12-24T04:03:41Z")
Crypto is extremely speculative and IMHO too risky to consider an investment. It’s more like gambling. If you have a long investment horizon invest your CD money in an S&P 500 index fund (e.g., Vanguard). No equities investment is risk-free but it’s a good bet for 20+ years. ---
**Author:** ![CookingWithGas](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/cookingwithgas/32/485_2.png) [@CookingWithGas](https://boards.straightdope.com/u/CookingWithGas)\ **Post date:** [December 24, 2022, 4:07am UTC](https://boards.straightdope.com/t/sam-bankman-convicted-2023-11-02-was-living-with-parents-then-jail-is-btc-and-cryptocurrency-busted-too/977019/27 "2022-12-24T04:07:29Z")
Cryptocurrency is pretty good as a currency. It’s really terrible as an investment. I would have to disagree with the bit about inflation protection, though. There is nothing intrinsic to cryptocurrency that makes it a hedge against inflation. ---
**Author:** ![aceplace57](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/aceplace57/32/3500_2.png) [@aceplace57](https://boards.straightdope.com/u/aceplace57)\ **Post date:** [December 24, 2022, 4:11am UTC](https://boards.straightdope.com/t/sam-bankman-convicted-2023-11-02-was-living-with-parents-then-jail-is-btc-and-cryptocurrency-busted-too/977019/28 "2022-12-24T04:11:07Z")
Thank you. I’ll talk with my broker about Vanguard or something similiar. ---
**Author:** ![bob\_2](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/bob_2/32/3341_2.png) [@bob\_2](https://boards.straightdope.com/u/bob_2)\ **Post date:** [December 24, 2022, 12:42pm UTC](https://boards.straightdope.com/t/sam-bankman-convicted-2023-11-02-was-living-with-parents-then-jail-is-btc-and-cryptocurrency-busted-too/977019/29 "2022-12-24T12:42:31Z")
> [@dolphinboy](#): > > 8 benefits of cryptocurrency > > ```auto > Transaction speed. > Transaction costs. > Accessibility. > Security. > Privacy. > Transparency. > Diversification. > Inflation protection. > > ``` _Transaction speed_: I can transfer money (well, the numbers in my bank account) to a stranger in minutes after some checks. _Transaction costs_: There is no charge for the service. _Accessibility_: Not sure what’s meant by this. I can access my bank account 24/7/365 from anywhere with an internet or mobile phone connection. _Security_: The bank is backed by the government. Crypto has no fallback. _Privacy_: Yeah, you got me there. If I buy drugs or pay a hitman through my bank account, I might have a problem. _Transparency_: That seems to contradict “privacy” above. _Diversification_: What does that even mean? _Inflation protection:_ I thought that the values of all Cryptocurrencies had taken a severe hit recently. I’ll stick with my bank thank you. ---
**Author:** ![sachertorte](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/sachertorte/32/3727_2.png) [@sachertorte](https://boards.straightdope.com/u/sachertorte)\ **Post date:** [December 24, 2022, 1:24pm UTC](https://boards.straightdope.com/t/sam-bankman-convicted-2023-11-02-was-living-with-parents-then-jail-is-btc-and-cryptocurrency-busted-too/977019/30 "2022-12-24T13:24:35Z")
My understanding is that “inflation protection” is why bitcoin is a bad currency. USD gets spent because of mild inflation. In other words, the fact that USD loses value over time (slowly) encourages spending and lubricates the economy. Bitcoin is deflationary, meaning it’s value goes up over time, because the max number of bitcoin is fixed. The result is people want to hold bitcoin and not spend it. This is a bad currency in the same way that gold is a bad currency. If you are the type that thinks gold is a good currency, then bitcoin would be more of the same. And the transaction speed and cost of bitcoin is laughable. The energy cost per transaction of bitcoin is ridiculous. Transactions cost bitcoin. Fast transactions cost even more. ---
**Author:** ![ASL\_v2.0](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/asl_v2.0/32/3525_2.png) [@ASL\_v2.0](https://boards.straightdope.com/u/ASL_v2.0)\ **Post date:** [December 24, 2022, 2:52pm UTC](https://boards.straightdope.com/t/sam-bankman-convicted-2023-11-02-was-living-with-parents-then-jail-is-btc-and-cryptocurrency-busted-too/977019/31 "2022-12-24T14:52:32Z")
> [@bob\_2](#): > > _Diversification_: What does that even mean? Well, bitcoin is certainly “something different,” so in that way I suppose it’s diverse. But then the same could be said of \*putting jell-o down your pants. \*_The Muppets Take Manhattan_ reference. Someone will surely get it. ---
**Author:** ![Loach](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/loach/32/350_2.png) [@Loach](https://boards.straightdope.com/u/Loach)\ **Post date:** [December 24, 2022, 4:14pm UTC](https://boards.straightdope.com/t/sam-bankman-convicted-2023-11-02-was-living-with-parents-then-jail-is-btc-and-cryptocurrency-busted-too/977019/32 "2022-12-24T16:14:01Z")
As I understand it the SBF problem wasn’t specifically a problem with cryptocurrency. It was that he used money (in whatever form) from one portion of his holdings to prop up the failing portion of his business. When the information was leaked by his competitor there was a run on the company from investors pulling out their money. The money was no longer there. It was an old fashioned fraud that has happened long before bitcoin existed. It doesn’t mean anything specific to the viability of crypto but it does severely undermine the confidence of the public which may be just as important. I reserve the right to be completely wrong in my evaluation. ---
**Author:** ![Northern\_Piper](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/northern_piper/32/5304_2.png) [@Northern\_Piper](https://boards.straightdope.com/u/Northern_Piper)\ **Post date:** [December 24, 2022, 4:48pm UTC](https://boards.straightdope.com/t/sam-bankman-convicted-2023-11-02-was-living-with-parents-then-jail-is-btc-and-cryptocurrency-busted-too/977019/33 "2022-12-24T16:48:22Z")
That’s my take on it as well. The irony, of course, is that one theme about crypto is to have a “currency” that isn’t subject to gov’t regulation. Regulations like deposit insurance and reporting requirements. Regulations that have evolved over the past century to ensure that ordinary depositors are protected from fraudsters, and have some insurance in case a fraud occurs. When Quadriga went under, one of the first things I noticed in the media were calls from crypto-owners calling on the government to do something to help them get their money back. ---
**Author:** ![Sam\_Stone](https://avatars.discourse-cdn.com/v4/letter/s/ecccb3/32.png) [@Sam\_Stone](https://boards.straightdope.com/u/Sam_Stone)\ **Post date:** [December 24, 2022, 10:22pm UTC](https://boards.straightdope.com/t/sam-bankman-convicted-2023-11-02-was-living-with-parents-then-jail-is-btc-and-cryptocurrency-busted-too/977019/34 "2022-12-24T22:22:04Z")
> [@dolphinboy](#): > > 8 benefits of cryptocurrency > > ```auto > Transaction speed. > Transaction costs. > Accessibility. > Security. > Privacy. > Transparency. > Diversification. > Inflation protection. > > ``` Transaction speed and transaction costs have been listed as a negative for Bitcoin, because the ledgers have to be updated with every transaction. Accessability? In what sense? Having to maintain a wallet or trust a sketchy exchange doesn’t seem very accessible. Security? How many digital currency thefts have hapoened in the recent past? How many wallets have been rendered useless because the password was lost? Inflation protection? Not even close. Speculative bubbles caused by easy money are the first things to crash when interest rates are increased to fight inflation. Your bitcoin doesn’t earn interest, but your bank accounts and Treasury bills do. Anyone who parked their money in bitcoin at the start of the inflationary period has been absolutely hammered. ---
**Author:** ![Hari\_Seldon](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/hari_seldon/32/5173_2.png) [@Hari\_Seldon](https://boards.straightdope.com/u/Hari_Seldon)\ **Post date:** [December 24, 2022, 11:51pm UTC](https://boards.straightdope.com/t/sam-bankman-convicted-2023-11-02-was-living-with-parents-then-jail-is-btc-and-cryptocurrency-busted-too/977019/35 "2022-12-24T23:51:24Z")
> [@Alessan](#): > > The difference is that unlike crypto, gold and other metals are also commodities, which is the source of their value. As a commodity, gold is not worth much. Gold jewelry is not inherently better than, say, silver or copper. Gold has some use in electronics, but its value is based only on the fact that other people accept that it does. ---
**Author:** ![Alessan](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/alessan/32/465_2.png) [@Alessan](https://boards.straightdope.com/u/Alessan)\ **Post date:** [December 24, 2022, 11:58pm UTC](https://boards.straightdope.com/t/sam-bankman-convicted-2023-11-02-was-living-with-parents-then-jail-is-btc-and-cryptocurrency-busted-too/977019/36 "2022-12-24T23:58:56Z")
> [@Hari\_Seldon](#): > > Gold jewelry is not inherently better than, say, silver or copper. Nothing is “inherently” better than anything else. But so what? People want to wear gold jewelry more than they want to wear silver or copper. They think it’s prettier. That perceived beauty, more than anything else, is the source of gold’s value. Jewelry is a $250 billion industry, and gold is one of its primary raw materials. That’s a lot of value right there. ---
**Author:** ![dougrb](https://avatars.discourse-cdn.com/v4/letter/d/76d3ee/32.png) [@dougrb](https://boards.straightdope.com/u/dougrb)\ **Post date:** [December 25, 2022, 1:20am UTC](https://boards.straightdope.com/t/sam-bankman-convicted-2023-11-02-was-living-with-parents-then-jail-is-btc-and-cryptocurrency-busted-too/977019/37 "2022-12-25T01:20:22Z")
> [@Alessan](#): > > That’s a lot of value right there. Ron White… “Diamonds! That’ll shut her up.” ---
**Author:** ![Sam\_Stone](https://avatars.discourse-cdn.com/v4/letter/s/ecccb3/32.png) [@Sam\_Stone](https://boards.straightdope.com/u/Sam_Stone)\ **Post date:** [December 25, 2022, 3:04am UTC](https://boards.straightdope.com/t/sam-bankman-convicted-2023-11-02-was-living-with-parents-then-jail-is-btc-and-cryptocurrency-busted-too/977019/38 "2022-12-25T03:04:20Z")
Gold’s obvious value for jewelry is that it doesn’t tarnish, doesn’t turn your finger green, and is malleable enough to be shaped into fine chains, intricate small designs, etc. It’s the same thing for gold as money. Gold lasts forever, doesn’t shrink, doesn’t corrode, etc. It’s dense, so doesn’t take up much physical space, and it’s rare and extremely hard to mine, making the global quantity predictable and relatively stable. In industry gold has many uses, and would have a lot more if it weren’t so expensive. That’s also a stabilizing factor, because if the price of gold goes down, demand for it goes up, stabilizing prices. ---
**Author:** ![JRDelirious](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/jrdelirious/32/9531_2.png) [@JRDelirious](https://boards.straightdope.com/u/JRDelirious)\ **Post date:** [December 25, 2022, 3:08am UTC](https://boards.straightdope.com/t/sam-bankman-convicted-2023-11-02-was-living-with-parents-then-jail-is-btc-and-cryptocurrency-busted-too/977019/39 "2022-12-25T03:08:04Z")
> [@Northern\_Piper](#): > > When Quadriga went under, one of the first things I noticed in the media were calls from crypto-owners calling on the government to do something to help them get their money back. **Good times:** _“Unleash the power of private initiative! Relieve wealth creation of the burden of taxation and regulation! Let the market reward those who take risks!”_ **Bad times:** _“GOVERNMENT, SAVE US!!!”_ Sure, it’s not just the NewEconomy types who are into this. Been hearing it from every sector for decades… But yeah, I mean a totally deregulated “currency” will be subject to debasement, or hyperinflation, or wild swings in exchange rates. I take the correction that gold can be valued as a commodity, but in practical terms in an advanced economy that means it stops being _really_ useful as _currency_ – and that had been happening to crypto. ---
**Author:** ![LSLGuy](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/lslguy/32/5813_2.png) [@LSLGuy](https://boards.straightdope.com/u/LSLGuy)\ **Post date:** [December 25, 2022, 4:39am UTC](https://boards.straightdope.com/t/sam-bankman-convicted-2023-11-02-was-living-with-parents-then-jail-is-btc-and-cryptocurrency-busted-too/977019/40 "2022-12-25T04:39:32Z")
If you start from the assumption that you should be more afraid of your country’s central bank than you are of your country’s criminals, then yes, cryptocurrency is a fine answer to your problems. Either that or develop a more reality-based set of fears. [Previous page](https://boards.straightdope.com/t/sam-bankman-convicted-2023-11-02-was-living-with-parents-then-jail-is-btc-and-cryptocurrency-busted-too/977019.md?page=1) [Next page](https://boards.straightdope.com/t/sam-bankman-convicted-2023-11-02-was-living-with-parents-then-jail-is-btc-and-cryptocurrency-busted-too/977019.md?page=3)