Grand Crypto Illusion Exposed: Bitcoin's Hollow Promise Unveiled

Two new books, "Number Go Up" by Zeke Faux and "Going Infinite" by Michael Lewis, delve into the world of cryptocurrencies, exposing their emptiness and the cynical motivations behind them. While "Going Infinite" focuses on the rise and fall of Sam Bankman-Fried, founder of the FTX crypto exchange, "Number Go Up" investigates the murky dealings of Giancarlo Devasini, founder of the "stablecoin" Tether. Both books reveal the criminal activity and pointlessness underlying cryptocurrencies, raising questions about why they continue to attract so many wealthy and influential individuals.

The Grand Crypto Illusion: Unveiling the Hollow Promise of Bitcoin

A Comprehensive Examination of the Crypto Currency Enigma

Introduction

The realm of cryptocurrencies, exemplified by Bitcoin, has captivated the financial world, leaving seasoned experts perplexed and questioning the rationale behind its escalating value. The frenzy resembles a gold rush devoid of any tangible asset. Jamie Dimon, the esteemed CEO of JP Morgan, succinctly characterized Bitcoin as "a hyped-up fraud" in 2023.

Despite Dimon's scathing assessment, there remain staunch believers who perceive cryptocurrencies as a form of financial alchemy. They employ obscure jargon, such as blockchain, digital currency, and crypto investments, leaving the uninitiated utterly bewildered.

Exposing the Crypto Illusion: Two Incisive Books

Two pivotal books published in late 2023 have shed light on the true nature of cryptocurrencies, revealing them to be an empty financial charade. Zeke Faux's "Number Go Up" delves into the murky depths of the cryptocurrency world, while Michael Lewis's "Going Infinite" chronicles the meteoric rise and precipitous fall of Sam Bankman-Fried (SBF), the erstwhile billionaire founder of the FTX crypto exchange, who currently languishes in a federal prison after being convicted of fraud.

SBF: The Epitome of Crypto Cynicism

SBF may appear as an exceptionally cynical individual, recklessly gambling away billions of his customers' funds. However, as both books elucidate, cynicism permeates the entire crypto project. Its proponents extol the virtues of a currency free from government and central bank oversight, yet they struggle to articulate its actual functionality or practical utility. This profound disconnect is telling. As Lewis astutely observes in a footnote: "What is curious is how elusive Bitcoin is, as a thing to understand... You nod along and think you are getting it but then wake up the next morning needing to hear the explanation all over again."

Going Infinite: A Flawed Yet Revealing Account

Lewis's "Going Infinite" is not without its shortcomings. The author's extensive time spent with Bankman-Fried and FTX has drawn criticism from Faux, who accuses Lewis of developing an uncomfortably close relationship with SBF. In a review for the LA Times, Faux contends that "the author's questions were so fawning they seemed inappropriate for a journalist."

Nonetheless, one of the most compelling aspects of "Going Infinite" is its intimate portrayal of Bankman-Fried's brief moment of glory. A mere year ago, the world's elite flocked to his feet. Lewis was present when Tony Blair and Bill Clinton graced the stage with SBF at an FTX conference in the Bahamas in April 2022. The crypto wunderkind cut an eccentric figure, sporting cargo shorts and tube socks, while the impeccably dressed former world leaders listened intently to his every word. Anna Wintour, the former editor of Vogue, envisioned Bankman-Fried's billions bankrolling the prestigious Met Gala. Lewis vividly depicts Bankman-Fried petulantly playing computer games while Wintour made her sales pitch.

Number Go Up: Unraveling the Tether Mystery

Faux's "Number Go Up" features Bankman-Fried on its cover, but the central character is Giancarlo Devasini, an enigmatic Italian plastic surgeon who also founded a cryptocurrency called Tether. Tether is purportedly pegged to the US dollar and marketed as a "stablecoin." Like Bankman-Fried, Devasini is a troubling and intriguing figure, albeit more elusive.

Faux, a US reporter for Bloomberg, dedicates a significant portion of "Number Go Up" to tracing the murky origins of the funds propping up Tether's price. His investigation leads him from the hedonistic heights of superyacht parties to the remote depths of Cambodia, where unsuspecting Westerners are lured into anonymous cash transfers facilitated by cryptocurrencies, only to be exploited by criminal gangs engaged in human trafficking. Faux paints a damning picture of the nefarious activities that sustain and are facilitated by crypto.

The El Salvador Experiment: A Dubious Success

Faux relentlessly pursues Devasini, even venturing to El Salvador. In 2021, Nayib Bukele, the authoritarian president of El Salvador, declared Bitcoin an official national currency. With Devasini's assistance, Bukele reportedly plans to construct a "Bitcoin City" powered by a volcano. It remains unclear whether El Salvador's experiment has been a success or a failure, primarily because no public entity tracks the extent of Bitcoin usage or the health of the government's Bitcoin reserves.

A Consensus on Crypto's Ponzi-Like Nature

Despite their contrasting approaches, Lewis and Faux arrive at the same conclusion: Bitcoin is essentially a mind-boggling Ponzi scheme. However, a crucial question remains unanswered: why does something so evidently pointless continue to allure so many wealthy and influential individuals? Until this enigma is solved, the true nature of the crypto mystery will remain elusive.

Conclusion

Henry Williams, a London-based writer, poses a pertinent question that serves as a fitting conclusion: "All in all, the real question goes unasked - namely, why is something so pointless still seducing so many wealthy and powerful people? Until we can answer that, we won't be able to get to the bottom of the great crypto mystery."