Comment by miohtama
15 hours ago
Stablecoins are frozen so the hole will likely be around two billion dollars.
Binance has equity and cash flow cover this, outside the insurance fund.
They custody $150B.
FTX was larger in dollar terms and ecosystem was smaller back in a day.
This might sound good.. but freezing currencies is bad. It evaporates trust of liquidity from whoever is doing governance. It's part of the reason why the bond market is doing what its doing lately and why countries are on-shoring gold reserves.
That sounds kind of ideal, but I feel like their actions might have been justifiable.
If a massive heist like this triggered a run on one of the largest exchanges (Binance), potentially leading to a liquidity crisis, the consequences for the ecosystem could be far worse than temporarily freezing specific addresses holding stolen stablecoins.
Not saying that's what would have happened, but it seemed like a real possibility. And I'm not saying freezing assets is good in general, but in this particular case, maybe it was the lesser evil.
No. Permissioned cryptocurrency is all the horrible parts of cash and all the horrible parts of crypto put together with none of the advantages of either.
I want crypto because I don't trust nation states with the leverage and dials of fiat currency. All we've done is replace government with trusting whoever made a particular stablecoin.
Permissionless crypto is the only real crypto.
5 replies →
governments freeze currency all the time.
Only the shithole countries freeze currency trading. That doesn't happen with actual reserve fiat currencies.
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Name one anyone trusts.
definitely not the ones I keep track of, eh.
they borrowed ETH against the stablecoins on AAVE before they were frozen
Doesn't matter how much they custody!
Uh don’t you not want to cover losses with customer funds?
Put some pyramid in that blockchain?!
Recursive pyramids!