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Ethereum Co-Founder Says Cryptocurrencies Are 'a Ticking Time Bomb' (bloomberg.com)

Posted by BeauHD on from the ticking-time-bomb dept.

randomErr writes from a report via Business Insider (alternate source): Ethereum, the rival to bitcoin, has been on a tear. Its founders said the latest trend in the cryptocurrency space may not be as good for the cryptocurrency as some might think. Ethereum is up 1,700% over the last year, and that spike has occurred in tandem with the growth of the hottest new trend in fundraising: initial coin offerings. Approximately $1.2 billion has been raised by the new cryptocurrency-based capital raising method this year, according to Autonomous Next, a financial technology analytics service. It is a trend that has sparked excitement across Wall Street. But the cofounder of the company behind the cryptocurrency, Charles Hoskinson, told Bloomberg that initial coin offerings may not benefit Ethereum. "People say ICOs are great for ethereum because, look at the price, but it's a ticking time-bomb," said Hoskinson. "There's an over-tokenization of things as companies are issuing tokens when the same tasks can be achieved with existing blockchains. People are blinded by fast and easy money."

9 of 64 comments (clear)

  1. Woo-hoo! by cirby · · Score: 4, Funny

    I can practically hear the GPU prices dropping!

    1. Re:Woo-hoo! by Applehu+Akbar · · Score: 4, Insightful

      Don't be jealous because you missed out on the gold train....

      The miners forty-niners were not the ones who made big money on gold. It was the entrepreneurs who serviced them, like A P Giannini, founder of Bank of America. One of the more successful was a dry goods merchant who arrived in San Francisco with a shipload of sturdy canvas sailcloth, intending to cash in on the need to re-rig all the ships that had to round the Horn and sail up the uncharted Pacific coast of the Americas to get to the goldfields. Though he badly misjudged the market for sailcloth, he dyed his fabric blue and made pants out of it. Miners needed lots and lots of pants, and the rest was history. His name was Levi Strauss.

    2. Re:Woo-hoo! by ItsJustAPseudonym · · Score: 4, Funny

      Miners needed lots and lots of pants...

      So his "round the Horn" prediction came true after all.

  2. Remember the Pyramid Parties in SoCal in 1980? by darthsilun · · Score: 4, Insightful

    Cryptocurrency speculation reminds me of the pyramid "parties" in Los Angeles back in 1980.

    At least in a pyramid party if you were standing in line to get in and nobody else was getting in line behind you you could bail.

    If you were smart.

    There were a lot of not smart people.

    Those who cannot remember the past are condemned to repeat it. --George Santayana

  3. Not Quite by Anonymous Coward · · Score: 4, Informative

    He said ICOs are a problem, not cryptocurrency per se. Basically, he's saying there are too many cryptocurrencies.

  4. The Headline is Incorrect by Anonymous Coward · · Score: 3, Informative

    He says ICOs are a ticking time-bomb, not cryptocurrencies directly.

  5. Clickbait headline by Anonymous Coward · · Score: 3, Insightful

    He says ICOs are a timebomb. He did not say cryptocurrencies or blockchain are, they are are clearly here to stay. Currencies are insane volatile though. Still a poor headline

  6. Re:Of sourse they are by rtb61 · · Score: 4

    It's far smarter to kick back against the intended slavery of the banksters and corrupt governments and make cash king. Asking for permission with credit cards is going too far. Of course with legalised theft in the US, the feds and law enforcers being able to straight up steal your stuff without any conviction which is wildly unconstitutional, you have a real problem in the US. Don't let them fool you, a cashless capitalist society is a slave society.

    --
    Chaos - everything, everywhere, everywhen
  7. Re:It's the same as the stock market by Aaden42 · · Score: 3, Informative

    Owning a share of stock means you own a percentage of the corporation's assets.

    You might want to read the fine print on the "normal people" stocks that you can actually buy on an exchange or have in your retirement portfolio. All but the most preferred of preferred stock offerings are subordinate to basically everything in any kind of bankruptcy or reorganization. Generally the employees pensions come before common stock. You don't realistically own even a paper clip's worth of assets from any company you hold stock in. In the event of the company collapsing, the amount of leverage held by most companies means common stock isn't much better than junk paper in terms of what investors will recover. Literal pennies on the dollar would be a exceptionally good outcome.