Cryptocurrency was invented to remove middlemen and counterparty risk. So what do all the blockheads in cryptocurrency do? They reintroduce middlemen and counterparty risk. They say, ‘We’re going to give you yield on your Bitcoin.’ All you need to do is hand over your precious private keys to fake DeFi apps, like BlockFi, Celsius or Cred. Cred goes bankrupt. Everyone loses their money. Who could have predicted that? Everybody. Satoshi could have predicted that. The stupidity of the crypto space is infinite.
42% of all bitcoins sit in 2,000 addresses. Where’s the decentralization? There isn’t any. And this only becomes truer and truer as the billionaire class enters the market, as they are now doing. But, even before that happened, there was a paucity of decentralization. Take the 300,000 bitcoins sitting in the OKex cold wallet, which were apparently secured by a multi-sig wallet, as should be the case. But, guess what? It’s not actually multi-sig, it turns out. The founder Star Xu is sitting in jail and he evidently has the keys. Why else would no one be able to get their coins out of the exchange. These centralized entities are dangerous gatekeepers.
Furthermore, Binance recently acquired the listing site CoinMarketCap. Is that good? No! A listing site that compares places you can buy coins got bought by a place where you can buy coins. That’s called a conflict of interest. How do listing sites make money? Ads. Who advertises on listing sites? Useless coins that wreck people and go to zero like Yam and all these other scam coins pulling exit scams or getting hacked. So, who’s making money on scams? Coin ranking sites. Who are the gatekeepers? Coin ranking sites.
They manually set the rankings on CoinMarketCap by themselves, by the way. Other sites like Nomics, CoinPaprika or TradingView show more accurate rankings. What does it take to rank high on a ranking site? Listings on centralized exchanges, so users can lose their money. It’s disgusting to me. I’m in a decentralized industry designed to improve the world surrounded by a bunch of centralized self-aggrandizers, who live on everybody’s money. Oh, the irony.
Among the top ten coins on CoinMarketCap, there’s nothing but copycat coin. Did Charlie Lee develop anything novel? No. He copy and pasted Bitcoin and changed the consensus method and the number of coins to be minted. Bitcoin Cash, Litecoin, BSV, and even zCash are copycat junk. It is a joke that coins with zero original code rank at the top.
I get asked by people who actually care about the future of decentralization if this is incompetence or backhandedness. This is a false binary choice. It’s both. They are not mutually exclusive. The individuals running this industry are both incompetent and backhanded.
Creating financial software is difficult. A blockchain-based financial software is the hardest by far to securely deploy. This is not the place to move fast and break things, for what gets broken in the end is peoples’ life savings.
So let’s talk about incompetence. Ravencoin, a stealth mined project, comes to mind. So, they launched after a stealth mine? That’s fine. That’s how the founders secured their bags. Ok, no problem. But, the coin inflated 5% due to an inflation bug in the code, and those who exploited that bug dumped the coins they minted on the market leading to a precipitous fall in price. Now why did they have an inflation bug? For the same reason that Stellar’s XLM, Bitcoin, and Monero had an inflation bug: because the software was spaghetti code sans modularity, an audit, and written spec.
Not to downplay Satoshi’s genius, but, yes, even Bitcoin is run by spaghetti code. The rollback of the Bitcoin chain in 2010 happened because someone minted 20 billion extra bitcoin. Another inflation bug was later discovered by a Bitcoin Cash developer and instead of exploiting it and minting himself as many Bitcoin as he wanted, he told the core devs about it. In fact, he could have procured as many free bitcoin as he wanted. Still, people say Bitcoin is the most secure software in the world. No, it’s not. Has Ethereum had any inflation bugs? No. Have they been forced to roll back the chain? No. They choose to do so once voluntarily during the aftermath of the DAO hack. Bitcoin was forced to roll back its chain–it had no choice.
So does Bitcoin have a bug bounty program now? No. Does Ethereum? Yes. The crypto community is so stupid. I am a cypher punk. I believe in personal freedom, liberty and profit. These are all totally compatible concepts. If the crypto community believed in those ideals, people wouldn’t so easily lose all their money on an OKEX, QuadrigaCX, Cryptopia, BTC-E, Mt. Gox, Cred, and so on. That is, if people stopped using unaudited software, they would be much better off. If people listened to my advice, they’d be much richer.
But, they are instead followers who travel the path of least resistance. So, they celebrate moral victories like when PayPal starts buying and selling Bitcoin. I remember when Bitcoin was going to replace PayPal. Now everyone celebrates that you can buy fake bitcoin there. You can’t send a bitcoin and you can’t receive bitcoin on PayPal, because they aren’t selling bitcoins. They’re selling Bitcoin IOUs. Still, we tell ourselves we’ve made it. And the space pats itself on the back: “Oh, we made it. Bitcoin is on PayPal now.”
That’s no win if you give a damn about the original principles of Bitcoin. It’s no win that we can merely buy PayPal’s IOU that they label BTC. I am seemingly alone in that position, and quite frankly it disgusts me.
You can buy fake bitcoin there and hold fake bitcoin, but you can’t deposit real bitcoin nor can you receive real bitcoin. It’s a joke. They claim they will hold physical bitcoin equal to your holdings in their terms of service. But not your keys, not your coins. It’s really that simple. Bitcoin was designed to get rid of middlemen. What is PayPal but a middleman?
Now, some argue that PayPal is a tool for mass adoption, and that the retail public can participate in bitcoin and have some exposure to crypto. Bitcoiners might feign happiness that grandma, so to speak, can easily participate in the market. But, I believe that is disingenuous. I believe instead the reason people cheer on a company like PayPal when it offers Bitcoin services is because of the potential for price appreciation.
OG Bitcoiners like me were trying to replace these rent seeking, censorship friendly behemoths. That’s the whole purpose behind Bitcoin: to get rid of the likes of PayPal. Good for you that your bags are pumped because an evil company sells fake bitcoins. But, they’re not your friend, you fools. They want to rent-seek you into oblivion. They want to make yield on you. They want to strip you of your privacy and sell your data. They’re not your friend. They want to make money on you.
There’s a reason they won’t let you deposit real bitcoin: they don’t want to let you withdraw real bitcoin. They need to stay in the middle to make money off you. When you have your own wallet, your own keys, you’re free. You have control. They don’t want you to be free. They don’t want you to have control. They want power and control.
Many of your fellow Bitcoiners, in fact, don’t want you to have power and control, either. For instance, you probably think that a higher hash rate protects you and is more secure. You’re wrong. Hash rate is a protection racket. You can catch software bugs with audits. Hash rate doesn’t help with security today. When I entered Bitcoin, however, a higher hash rate did provide value. Back when bitcoin was mined with GPUs, hash rate actually protected Bitcoin from attacks by CPU botnets. When the ASIC miners came along, GPU mining became unprofitable.
Nowadays, ASICS protect you from themselves. ASIC miners are the only people that could attack you from the vector. You’re paying a protection racket. You’re paying the potential attackers not to attack you. The only thing SHA-256 hash rate protects you from is SHA-256 51% attacks. The only people in the world who can use this attack vector are the ASIC miners.
And, tragically, the same people who you pay to protect you from such attacks end up attacking you anyway. That’s what happened with Bitcoin Cash. They tried to kill the real Bitcoin with a fake Bitcoin sponsored by those who got rich selling the mining hardware, shipping it to you late, and in so doing taking half the profit. All this after you had been all along paid them to protect the network. That’s called corruption.
The absurdity doesn’t end there. I could go on and on. People brag about giant Bitcoin transactions being sent for billions of dollars as one example. This breaks the security model, because not meant to be used that way. So I’m out here retweeting Nick Szabo and saying, ‘Hey guys, stop sending these giant transfers. It’s worth it for bad actors to double spend your transaction and roll the chain back twenty weeks to pretend that this didn’t happen. Then those guys get their coins back. They split the profit with the miners that help roll back the parallel chain.’
Such confidence in Bitcoin is splendid, but a 94,500 BTC tx tempts fate. If recipient can make that much from reversing the tx, they can afford to run a 51% attack for more than 40 days. Big if & very visible, but security here depends more on trust & less on the protocol itself. https://t.co/KQjH8RiAck— Nick Szabo (@NickSzabo4) September 6, 2019
But, people are too stupid to take the good advice. They’re out there bragging about people using the blockchain wrong and breaking the security model. Szabo and I are the only ones talking about it.
The space has gone insane. It has been insane for a long time. And I’m one of the only ones speaking the truth about it. I have to shove knowledge into blockheads, because what they believe is often wrong.
And By the Way: No, My Invention HEX Is Not A Scam
If you’re public in any industry, including the crypto space, you will be hated by some. I don’t care who you are. Go to Donald Trump’s Twitter and you read what they say about him–it’s terrible. Go on Biden’s Twitter, and everyone calls him a pedophile. If you have a public identity, you are going to be violently hated by thousands of people, no matter what you do. Vitalik Buterin is still called a scammer to this day, and all he has done is write open source software and donate money to longevity research.
So, why are people so quick to call people scammers? Because they want to look cool to their friends and perhaps pump their bags. That’s all the industry cares about. They have no dedication to the truth.
I retired six years before the invention of Bitcoin. I’ve written two self help books you can download for free, and I have received dozens of emails from people whose lives I’ve changed. I helped them quit video games or have better relationships or pay off their student debt with my invention, HEX, which is based on novel game theory and new code and has gone through two security audits and an economics audit.
I’m out here giving free advice, free videos, free price calls. I called the 2017 $20,000 Christmas when the price was $4,000. Everyone else got it wrong. I called the multi-year bear market at $8,500. No one else had the courage to do it. I have tried to help people not get scammed by things like IOTA, which manually shuts the network off whenever they want.
I have ‘F You’ money, and I will speak the truth, while too many other people are cowards. They’re not willing to have confrontational and uncomfortable conversations. I love it. Because I win every debate in which I partake. If someone debates me on a live stream, they lose. I don’t care what we’re talking about. We can debate hot dogs–doesn’t matter. If someone disagrees with me, they’re losing, because I usually am right. And they’re usually wrong. Maybe it’s because I spend all day reading. Maybe it’s because I was born with a high IQ, I don’t know. But, the fact of the matter is, I want to spread the truth. I’ve got an audience. I tell them the truth. And I’ve been right over and over and over and over and over again. And, everyone else has been wrong.
For example, Charlie “Satoshi Lite” Lee, Litecoin founder, called HEX a scam and to avoid it. HEX is up 70x over Litecoin. People who listened to them might have missed out on an opportunity of a lifetime when it comes to HEX. All he did was copy and paste Bitcoin’s code and change the number of coins which would be produced over time. That’s not innovation. I don’t hear him talking now as people realize how wrong he was about my project. He should apologize. But, he won’t, because he is a coward in an industry of cowards. But, I am not a coward. The people in HEX are not cowards. A lot of the HEX content creators are ex-military. I don’t know why. It’s just the way it is.
Despite a $5 billion dollar CoinMarketCap, my invention, Hex, appears on page three of CoinMarketCap. That makes zero sense. Why are we on page three? So, you want us to list on more centralized sites so our users can risk losing all of their funds? Like Kucoin? Like OKEX? I am in a decentralized industry run by a bunch of centralized fools who lose everyone’s money.
What does HEX do better? Everything. All liquidity is on chain in Uniswap, which is decentralized. There’s $8 million liquidity sitting on Uniswap where there is no counterparty risk. There is no scamming or spoofing. It’s all on chain and verifiable. It’s the most transparent, open trading in the entire world. You can’t get this level of transparency on Nasdaq Level II, an order book which shows a ranked list of the best bid and ask prices from each of these participants, providing investors detailed insight into the price action.
HEX has no off switch, no pause switch, no admin keys, no oracles. What’s an Oracle, anyway? It is some guy running a server telling the blockchain what the reality is supposed to be. That guy changes the number, fudges the data a bit, and the whole project dies.Yet, the industry is chasing this point of centralization.Meanwhile, decentralized finances all have admin keys and oracles. Uniswap doesn’t. HEX doesn’t. Yet everyone calls HEX the scam.
Some claim HEX is a scam because we discuss price on our home page. I listen to the market, and I know what the crypto market cares about: the moon. HEX has performed quite well and, in fact, it has performed better than Bitcoin this year. I speak about price quite openly because people are interested in that. And I speak not only of price gains, but of price drops, too. Did you know Bitcoin periodically flash crashes? Huh. No one told you that? Well, I did. I discuss the extreme volatility openly, because it matters. I write that on the home page, but these other people don’t mention it anywhere on their site. HEX does everything more honest, yet we’re treated as scammers by everybody. It blows my mind.
Whereas Bitcoin, Monero, Stellar, and Ravencoin all suffered inflation bugs in their spaghetti code software, HEX has not. Why not? Because HEX’s consensus code is locked and isolated in a contract. It is secure. These other coins have inflation bugs, which means anyone can get as many free coins as they want. That isn’t so good for accounting software, is it?
I’ve been public a long time. It is clear what I care about: I care about making the world a better place. I’ve been retired for 20 years. I don’t need to do what I do, but I care. I created HEX, and am still involved to this day, to make the world a better place. And, still, I get called a scammer by scumbags who aren’t giving anybody a damn thing. It is mind-boggling to me.
Richard Heart is a self-made millionaire and serial entrepreneur with startups in consumer electronics, marketing and finance. He is an unrelenting thought leader in the blockchain and cryptocurrency space and founder of HEX, the world’s first blockchain time deposit and high interest blockchain certificate of deposit. Every day HEX stakers earn interest. HEX stakers make additional interest when people end their stakes earlier or later than they committed to.