Synapse debacle cost some users their life savings | Hacker News Reader

Synapse debacle cost some users their life savings

axios.com

20 pointstoomuchtodo10 comments

"The trustee says that Synapse doesn't have enough to pay for an outside firm to reconcile the ledgers, estimating it would cost between $2 and $3 million."

After a bankruptcy, the bankrupt party loses financial privacy. Someone should ask the court to release the raw data. Put that in an AWS bucket and someone will probably figure out what happened.

Let's not forget Synapse has investors like Andreessen Horowitz sitting on untold billions of dollars who are totally fine fucking over the common-folk so they can hoard that much more wealth. $3 million is a rounding error to them. These people are monsters and should be named and shamed.

When Silicon Valley Bank went bust, Anderessen Horowitz was one of those screaming for a federal bailout for accounts way over the FDIC insurance limit. They got the bailout.[1]

[1] https://www.npr.org/2023/03/11/1162805718/silicon-valley-ban...

There is some poetry that I am unable to capture when you juxtapose those rich assholes begging daddy government to bail them with that retarded libertarian screech from Marc Andreesen about Techno-Optimism: https://a16z.com/the-techno-optimist-manifesto/

Those people are sociopaths, and society would be better to treat them as such. At best they are just rich bufoons, at worst they have enough money to shape things according tp their dangerous views.

Ok I’ll bite… how do we do this (get rid of them)?

Eat them.

Wait until the new administration deregulates crypto. Search "lost life savings crypto". Over there, that's normal.

All those new suckers to fleece.

In the US, cryptocurrencies are not currently regulated, so one cannot deregulate them. Also the article discusses about saving accounts and payments style product, not an investment product.

The exchanges are regulated which is 99% of people's on and off ramp.

Matt Levine covers this in his newsletter today:

> The other risk, which we talk about less, and which is sort of less intellectually interesting, is that the bank might lose track of the money. You might go to the bank and deposit $100, and the bank might write down “$100” next to your name in its notebook, and then it might spill coffee on the notebook and be unable to read the entry and forget that it owes you the $100. And then you might come back to the bank in a week and ask for your $100 back and the bank might say “who are you? what $100?” And the bank might be totally solvent and have invested your $100 in very safe things, but it won’t give it back to you because it doesn’t have a record of you.

> This risk is also heavily regulated, though you hear about it less. That regulation is just less controversial. There are material and debatable trade-offs in bank capital and liquidity regulation: A bank with tons of capital will be safer, but it will also have less capacity to lend to the real economy, so there are debates about what the optimal level of capital should be. Whereas with keeping track of the money, there are fewer trade-offs. Banks should entirely keep track of the money. Nobody is lobbying for “actually bank ledgers should be a bit more loosey-goosey.” The proper amount of losing track of the money is none.

> And this risk is harder to fix after the fact. If a bank loses all your money, the FDIC can give you your money back, because the FDIC is the government and can print money. If the bank loses its list of who has the money, what can the FDIC do? You can go to the FDIC and say “that bank owes me $100,” but anyone can say that, whether or not it is true. The definitive list of who the bank owes money is kept by the bank. Unless it isn’t. If the bank doesn’t keep a definitive list, then nobody does.

Funnily enough, blockchains fix this. They are ledgers were data is very hard, or impossible, to lose.

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