Crypto trading rehabs are a thing now

By Shira Jeczmien

Sep 20, 2018

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If you too, like me not long ago, found yourself opening crypto wallets and frantically checking the inflation rate of the coins every half hour, turns out that feeling was vastly more complex than simply FOMO of waking up quite literally a multi-millionaire. Much like many addictive aspects out there in our lives, cryptocurrency trading shares many of its traits with gambling and substance abuse. So much so, that in June of this year, Scotland became the first country in the world to open a rehabilitation centre for those battling with cryptocurrency trading addictions.

Yes sure, trading in stocks is also an addiction in its own right, but isn’t the dark side of crypto trading and its addictive byproduct essentially the clearest indicator there can be (a red flag in fact) that the currency is flaky as hell and more unstable than mining coins on a domestic router? The Scottish Castle CraigHospital’s new crypto-addiction department is unique and should not be overlooked for its significant forward thinking. But what should also be notable are the dangers of continuing to pump money into a coin—and a future economy—that is gravely unstable and unpredictable.

“Cryptocurrency users can get hooked by the volatile fluctuation of prices online which creates a ‘high’ when they buy or trade a winning currency” and “this can be exciting but also addictive and… financially disastrous,” said a representative from the clinic. The symptoms of crypto addiction are not dissimilar to those of gambling, from people risking their spare money to groceries funds, rent and mortgages. Yet one of the fundamental differences in regard to crypto addiction is that its success stories, like that friend of a friend who made millions in months or 50 Cent becoming an accidental Bitcoin millionaire, are heavily mediatised. As crypto coins gained immense traction twelve months ago, with Bitcoin reaching a figure of £12,000 per coin and Ethereum and others following in its footsteps, it seemed that everyone wanted to get their hands on it—heck even I went as far as opening a crypto wallet and started to dabble in a trade of a currency I essentially knew nothing about—and I’ve never so much as looked at a stock before.

The bottom line here is not so much a praise for the crypto rehab, nor that we need more, but that the speed with which the industry is excelling has left too many gaps in what we should perceive the currency to be and how it might be regulated. There are still advocates of crypto trading who do not believe an addiction to the trade exists and that, according to Manav Singhal, CEO of the blockchain startup Velix.ID, “Profits and losses are just a part of the trading, and it is no different than trading any other kinds of securities.” Adding that “There’re many reasons that make you trade cryptocurrencies frequently, given how fast things are changing in the industry.” And indeed that is true. But when an industry has boomed so quickly and to no limitation, without regulation (which granted is the great thing about crypto and yes I admit this opens up all sorts of questions to currency regulation), the most financially vulnerable are at very high risk of losing it all, including psychological wellbeing.

Even though Bitcoin is at an all-time low (it has been plummeting since its peak in December 2017 and is now at 68 percent of its then value), and the crypto economy having shed a total $500 billion according to CoinMarketCap, success stories in its trade still surround us—small and large. So as the haze of accidental or fluke crypto cash-ins fades; as the market value drops and as more and more people are being treated for serious addiction issues around it, it might be time to move away from the free-of-regulations dream that this currency promises and truly start to tackle the dangers it poses in real life.

Crypto trading rehabs are a thing now


By Shira Jeczmien

Sep 20, 2018

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Facebook launches a cryptocurrency called Libra

By Yair Oded

Jun 21, 2019

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It’s now official. Facebook will launch a global, digitally-native cryptocurrency in mid-2020. In a white paper published by the social-media giant earlier this week, Facebook introduces its future digital currency, Libra, as an easy-to-use replacement for cash, which it claims will grant access to financial services for people across the globe (particularly to the 1.7 billion ones who do not have a bank account). Yet, alongside promise and entrepreneurial zeal, the impending interference of the company in the world banking system evokes a great deal of doubt and concern.

You gotta give it to Facebook. Venturing to develop a monetary system that will replace cash is a massive undertaking, particularly since it involves exploring largely uncharted territory. With cryptocurrencies such as Bitcoin failing to gain the trust of the masses and others like Q simply disappearing into the ether, it would take an enormous amount of creativity, financial acumen, and technological ingenuity to formulate a system that would seem appealing for investors to back and people to contemplate as legitimate. And that’s precisely what Facebook has managed to do, long before the actual launching of its product.

Libra is being developed as a blockchain-powered cryptocurrency. Unlike other digitally-native currencies, however, Libra will be fully-backed by a reserve of real assets, which will be locally regulated in each country. Each Libra issued will be backed by a currency or asset stored in the Libra Reserve in order to ensure the cryptocurrency’s stability and guarantee its intrinsic value. Facebook announced that Libra could be exchanged by anyone who has an iPhone and an Android at rates approximately ten-times lower than it costs to wire money electronically or internationally through the regular banking system. The company predicts that this will enable people in developing countries to obtain financial security and access services that currently are not available to them.

While the initial intent for Libra is to serve primarily as a money transferring tool, Facebook’s ultimate goal is to turn it into a mainstream currency, used to make every-day purchases and even serve as a loan and credit system.

Libra’s most unique characteristic, however, is the decentralisation of its governing body. Although Facebook is the one developing the currency, the company claims it has no intention to control it. To that end, it established the independent nonprofit Libra Association, presently comprised of 27 partners entrusted with monitoring the development and management of Libra. Among the members are major financial and technological corporations and service providers, including Mastercard, Visa, eBay, PayPal, Spotify, Uber, and Lyft, as well as nonprofit organizations, such as Mercy Corps.

So how does Facebook fit into this global financial ecosystem? The answer is simple: through its subsidiary—Calibra, a Switzerland-based company tasked with developing, launching, and bringing Libra to the masses. Calibra intends to do so by developing a digital wallet designated to send, receive, and use the Libra currency. Calibra will be implanted into Facebook-owed platforms such as Messenger and WhatsApp, and eventually launch a standalone Calibra app. Calibra (AKA Facebook) will, at least initially, possess one seat on the Libra Association board panel.

While Calibra will be the world’s first introduction to Libra, the company stated it will welcome any competition by another group seeking to establish a platform to exchange in Libra, and avoid any aspirations to monopolise the cryptocurrencies. In an interview for The Verge, Calibra Vice President of Product Kevin Weil stated, “Calibra can only be successful when the Libra ecosystem is successful.”

As great as this utopian virtual ecosystem appears, it also raises several red flags. One of the greatest risks about the Calibra enterprise is fraud and identity theft. And while Facebook vows to install the strictest technologies to ensure the safety of both users and the financial system as a whole, it remains to be seen whether it can keep this promise. This could particularly be an issue in countries where government-issued identification is unavailable or easy to forge.

In the U.S., numerous lawmakers and politicians have expressed grave concerns about the prospect of allowing a company notorious for data leaks and mismanagement to spearhead a global market revolution. The Senate Banking Committee has therefore announced this week that it will hold a hearing to examine Facebook’s cryptocurrency proposal on July 16.

Yet the most troubling aspect about the whole Libra/Calibra initiative is that we still don’t know how Facebook stands to gain from it. Currently, the company has only one vote on the multi-member board, and has declared in its white paper that data from Calibra will not be shared with other Facebook apps or platforms for ad-targeting purposes. It also stated that the very minimal fees Calibra will charge per-transfer will only be used to maintain the network’s security system. And so, we know there is money to be made—otherwise why would leviathans such as Visa and Mastercard be down to join the party—we just don’t know where exactly it will be coming from.  

As the scandal surrounding Facebook churns, and calls to break up the company intensify, the social media network volunteers to introduce a brand-new global market, which it will supposedly not dominate, for no other purpose than to facilitate the transfer of money and welcome the world’s most underprivileged into this virtual financial oasis. In a world where Zuckerberg is, ultimately, only about Zuckerberg, one must ask: where is the catch?

Facebook launches a cryptocurrency called Libra


By Yair Oded

Jun 21, 2019

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