The Zoo Has Gone Nuts: PayPal Will Give Me $25 if I Buy Cryptos

Ah, hefty “fees” & fat “spreads.” But wasn’t the promise of bitcoin to buy stuff without using fiat currency payment systems such as PayPal?

By Wolf Richter for WOLF STREET.

I got an email from PayPal, with this in the subject line: “Earn a $25 reward when you buy $25+ of crypto with PayPal.” And when I opened the email, it said, “Crypto for the people is here.”

And yes, I checked if this was from that infamous Nigerian colonel that had been offering me fortunes that I have been missing out on. But no. It was actually from paypal.com, and I would need to go to my PayPal account to get this done. OK, so this is truly PayPal.

I didn’t get this offer in my WOLF STREET media mogul empire PayPal account that I use as payment platform for donations. This is for a personal PayPal account I haven’t used in many years.

So this is a promo to get me to use the personal account again. I got promos before, but nothing ever like this. I mean, look at the possibilities: I can turn that $25 from PayPal into cryptos and become a billionaire for free before the year is up.

It came with simple instructions on how to proceed:

“Step 1: Save offer to your account by 9/25/21”

“Step 2: Buy $25 or more of crypto with PayPal by 9/30/21”

“Step 3: Use your $25 reward by 10/31/21”

And it went over the basics:

“What exactly is crypto? Crypto is short for cryptocurrency. Many believe that crypto could one day be as commonly used as cash and credit.”

“The crypto market never sleeps: It’s the only financial market that runs 24/7, 365 days a year. Since all cryptos are global currencies without borders, prices change every minute of every day.”

“Understanding volatility and risk: Crypto is considered volatile because of how much and how quickly its value can change. Like all currencies, there’s potential for gains and losses.”

And it came with lots of small print and linked an ALL CAPS warning.

If you’re into cryptos, you’re better off not reading the small print or follow the link to the ALLCAPS stuff.

At the bottom of the email was a litany in small print about risks and terms and conditions and fees and exchange rates and spreads – yep, no freebees on PayPal. This is about increasing PayPal’s profit.

It said among other things: “When you buy or sell cryptocurrency, we will disclose an exchange rate and any fees [extract profit] you will be charged for that transaction. The exchange rate includes a spread [extract profit] that PayPal earns on each purchase and sale.”

One of the links leads to the PayPal Cryptocurrency Terms and Conditions, which includes at the top an ALL CAPS warning:

“BEFORE YOU START: BUYING AND SELLING CRYPTO ASSETS IS INHERENTLY RISKY.” And yada-yada-yada, “…WHICH CAN RESULT IN SIGNIFICANT LOSSES IN A SHORT TIME, INCLUDING POSSIBLY A LOSS OF TOTAL VALUE.”

OK, I got it. PayPal is going to extract profits via hefty fees and fat spreads, and I get the risk of losing all my money “in a short time.”

In October 2020, as cryptos were spiking, PayPal announced a series of initiatives and future initiatives to get into the crypto space, not to take risks – that’s my job – but to extract profits from fees and spreads.

It said that it offered a service that would allow its customers “to buy, hold and sell cryptocurrency directly from their PayPal account,” and that it had plans to make cryptos “available as a funding source for purchases at its 26 million merchants worldwide.”

At the end of March 2021, when bitcoin was getting close to $60,000 and billionaires were frothing at the mouth, and just days away from its high of nearly $65,000, before plunging 55%, before bouncing off, and now, at $39,000, being down only 40% from the high – yes, just on the eve of all this crypto-drama, PayPal announced that customers who held bitcoin, ether, bitcoin cash, and litecoin in PayPal digital wallets would be able to convert them into fiat currencies at checkouts to make actual purchases in fiat currencies.

OK, wait a minute…

In the promo I got, PayPal called cryptos “global currencies.” So if they’re “currencies,” why would I need to convert them into hated and despised fiat currencies to buy anything?

And why would I have to pay PayPal hefty fees and fat spreads to convert cryptos into hated and despised fiat to buy stuff with when the whole promise of bitcoin at al. originally was cheap and easy payments anywhere by avoiding the hated and despised fiat payments systems that took fees and spreads out of everything? Where did that promise go? Ha, I don’t know either.

Upon the disclosure that Wolf Richter wasn’t going to fall for this crypto promo from PayPal that blew all original promises of cryptos out of the water, shares of PayPal collapsed by 0.3% to $299.40 before recovering as the Plunge Protection Team stepped in ?

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  131 comments for “The Zoo Has Gone Nuts: PayPal Will Give Me $25 if I Buy Cryptos

  1. MonkeyBusiness says:

    How can you lose Wolf? The Fed now says they only care about jobs, not inflation. They’ve also launched standing foreign and domestic standing Repo facilities, which is really double speak for “we are going to flood the world with dollars”.

    Crypto should do well.

    • DawnsEarlyLight says:

      Don’t blink.

    • Wolf Richter says:

      Both points are off. I’m going to cover the repo facilities in an article; and you should have listened to Powell on inflation today toward the end of the presser. It was ALL about inflation.

      • Joe Saba says:

        all these pay services – including CC are just ways to strip vig from consumers
        never ceases to amaze me when on friday afternoon at banksters place I see hard working people(1/3 of which have no bank accounts) cashing their checks and paying between $8 and 2% to banksters

        I use CC to obtain CASH REWARDS since I’m deadbeat(about 1/3 are)
        we pay our bills in FULL every month and on time

        funny thing is while merchants impute 1-3% vig CC charge to use their service they won’t give me same discount to use CASH(preferred)
        so I collect my 2% cash back and use it for stuff I need/want

        • Candyman says:

          Well, same amount is collected by merchant in your example. So no savings to merchant. Cash, maybe king to some, but easy for employee theft. Needs to be deposited in bank, costing payroll. Merchant accounts direct deposit monies, no theft. Also makes accounting easy. Unfortunately, we in MA can’t surcharge for cc, which would make cash king again! So essentially, you’re pissed YOU didn’t get a discount. But you are right…we merchant pay the rewards in the 3% …so best choice for you.

      • Yort says:

        I know videos are not allowed often, yet here is a twitter video of 2:09 minutes long of our Supreme Leader of the Fed explaining “Transitory Inflation” in a style I call “village idiot goes wild”.

        So without further ado, I introduce you to the most powerful human on Earth…(no wonder the aliens never visit)…LOL

        • Wolf Richter says:

          Yes, that was a classic. People can google: youtube federal reserve — which will pull up the Fed’s own YouTube channel, and people can watch the entire presser, which was quite interesting.

      • raxadian says:

        Then again, the USA is one of the few countries it has all their debt in the currency they print. A fact they use to kee inflating their debt.

        How long until it blows up? It has been several decades.

    • Prue Grubstreet says:

      Heck, some teen just sold a puffy Dorito for $20,000. It all passes for currency now…

  2. TenGallonHat says:

    Think it over.

    From thegatewaypundit recently, “PayPal said that the user data collected through the initiatives will be shared with other firms in the financial industry, law enforcement and politicians.” Re-read that.

    PayPal is such an awful business to deal with. Horrible customer service. My account funds were drained by some sort of hacker many years ago. I was required to use them with eBay but that has changed and I will be closing my account soon. I do not advise doing any business with PayPal!

    • TenGallonHat says:

      This is the article title: “PayPal Partnering With Anti-Defamation League to Share Info With Law Enforcement, Determine Who Can Use Their Services”

      (I didn’t mean to imply the quote above was regarding cryptocurrency itself).

      • Joe Saba says:

        surely they’ll recognize when I buy something for family and they reimburse me that it isn’t INCOME

        or is it – can’t wait for IRS to send me letter

    • drifterprof says:

      I agree. Paypal always made me feel very queasy, and for years I didn’t give it direct access to any of my cards. However, now I use it on unusual occasions where I don’t want to bother with signing on to my card account and making a virtual card number. Or when I want to avoid a vendor connecting my name with my card number. And I’m less nervous about it these days — I set alerts on all my cards that instantly tell me if the card has been used, and how much was charged.

    • joe2 says:

      I closed my PayPal account a long time ago when they changed their terms of service to include tracking all your Internet activity across all sites.
      God knows what the User Agreement says now. I read the agreements and you find some unexpected stuff. Like one site where recurring obligations will continue with interest even if you cancel your credit card. Hint: how do you know you are accumulating charges?
      Be careful what you agree to. Remember the old South Park episode.

      • BatHelix says:

        That South Park about the Apple terms and conditions was amazing! Look it up if you haven’t seen it.

  3. drifterprof says:

    Back around 2014, I had a work colleague who was jumping into Bitcoin. He had a mania for it based on escaping monetary control of governments, being able to do transactions with no fees. He had other mania’s too. For example, when he stopped smoking weed, he would get somewhat paranoid-schizophrenic (and begin thinking things like a person in administration really wasn’t that person – was some kind of sinister doppelganger who with other administrators was plotting to kill him).

    I argued with him that I could find some way of transferring money in which the fees were preferable to the hassle and limitations involved in using Bitcoin. He was also into the mining end of it, so maybe he’s a millionaire now. I guess it’s one of the several big investing mistakes I’ve made. I should have thought of it as getting in on the ground floor of a Ponzi scheme.

    • Joe Saba says:

      just like Shawshank redemption
      guy was bankster wrongly convicted

      said it best – I had to go to jail to become CRIMINAL

      not to worry – govt is turning all of us into CRIMINALS

      • Augustus Frost says:

        Someone is a criminal if the government says they are, whether they committed a real crime or a political one.

        • Jax says:

          “When governments become oppressive, the best people become criminals”…I think this is how it was quoted by someone smarter than myself.

    • Nik says:

      its never too Late….the Stock Market and US Dollars are still a viable options…lolol

  4. sunny129 says:

    Without regular intervention by PPT, where would be global Mkts!?

    Resurgence of Delta variant and reduced efficiency of vaccines against that, are the formidable challenges the Fed will be facing! More variants could be on their way!

    I always thought the Covid 19 as a counter force against the insanity of CBers! I am bear partially invested with hedges and 40-50% cash.

    The high volatility of mkts will continue with greed, fear and FOMO along the way. This will be a traders’ (with options know-how) mkt and NOT the traditional investors. They will become the fodder for HFT!

  5. Engin-ear says:

    Gartner published a concept of Emerging Technology hype cycle in 2017

    My personal undestanding is that the Crypttos should be approaching the desillusion right now.

  6. DR DOOM says:

    Every time I bring up where is the payment system that was the rage back in the day the coin heads get down right nasty about that. I like it. I keep picking at the scab and they always respond. Got to have something to occupy my time waiting for another round of stemmilicious fiat.

    • Nathan Dumbrowski says:

      Only because you mention coins. I brought my real coins to my bank and turned them in. They charged me 5% as a customer and for non-customers it was 8%. Turning my cash into my bank costs me a five percent tax. That is some BS

      • Old School says:

        I am 65 and remember when coins were valuable. Four quarters would get you a haircut and a paper dollar would get you a haircut. Now four silver quarters will get you a haircut and 20 paper dollars will get you a haircut. Something happened on my way to getting old.

        One neat thing is my Grandfather gave me some silver coins from late 1800s and early 1900’s. I passed on to my grandsons. It’s kind of neat that beside the silver content some have a higher collector value as they age.

        • Ethan in NoVA says:

          As long as the machine isn’t fake and the coin slots are still there, a quarter now will still get you a game of Ms. Pac Man just like it did in 1981.

  7. Chris Herbert says:

    As far as I know, it is not legal to convert a crypto currency into dollars. If that were to happen, it would undermine the monetary sovereignty of the United States. Something only a moron, or a crook would try to do. Unfortunately the US has a hefty supply of both morons and crooks.

    • c1ue says:

      Where did you get such an idea from?
      There are US crypto exchanges that have gone public. You very much can convert bitcoin to dollars .

    • Jon says:

      I have converted btc to usd many times

    • Artem says:

      Christ Herbert, perhaps you misunderstand the word “convert”

  8. Catxman says:

    PayPal is going to go down in history (as a footnote) as one of those First Wave internet companies that made a living off a primitive technological ecosystem that could not handle its own transactions.

    What I mean is that PayPal has no future. Eventually, a better payments system is going to come about, one that links smartphones, the internet and possibly fingerprint identification. You’ll be able to go to any computer screen in the world, press your finger to the pixels, and get authenticated as the owner of your money. There’s no need for convoluted payments systems like PayPal when that’s possible.

    In the far future, there will be direct scanning of the genetic code. DNA is the ultimate unique marker, and is tied with the state of your health and other markers too. We’ll be walking around in a world where our physical viability is being measured at the same time as we make payments with our DNA code and receive beamed advertisements that are actually pleasant to briefly watch as a respite from life.

    • sunny129 says:

      The fantastic world of ‘BIG BROTHER’ inside, outside and everywhere! Wow!

      Read the recent comment by Mr. Snowden on the software Pegasus/smart phones! That dystopic future is already here!

    • Djreef says:

      Like Minority Report where they scan your retina as you walk in the building.

      • joe2 says:

        Like today where they tell you what stores you are allowed to shop in and what essential things you are allowed to buy. If you wear a mask.

        Of course San Francisco is more civilized, just walk in and take what you want. Payment option? What’s that?

        • Wolf Richter says:

          Shoplifting is a NATIONAL problem. All retailers have provisions for it on their financial statements, called “inventory shrinkage.” It’s just that when it happens in San Francisco, it becomes national news for some braindead clickbait reason.

        • RightNYer says:

          Wolf, while that’s true, the fact that Chesa Boudin was elected DA does mean that SF’s de facto policies regarding prosecutions are very different from most other cities, including blue ones.

        • Wolf Richter says:

          RightNYer,

          I deleted that insidious thing that you said. You were essentially holding a toddler responsible for what his parents did. This crap is really braindead. Shame on you. It tells me how your mind works when it comes to SF. Dégueulasse in French.

        • c1ue says:

          Shoplifting is a national problem, true.
          Are the shoplifters as brazen anywhere else, is the question.
          I know there is some brazen-ness in Oakland, for example.

        • Wolf Richter says:

          c1ue,

          Shoplifters are brazen by definition, anywhere. They’re doing it in broad daylight in front of everyone with security cameras all around. That’s the same in every major store anywhere.

          But a security guard cannot arrest a shoplifter. An employee cannot arrest a shoplifter. Only a police officer can. Everyone is instructed to let them do it. You can confront them, but you cannot stop them. It’s the same everywhere.

          You just don’t see videos of it because no one cares when that happens in Tulsa or Dallas, it’s just in San Francisco that this braindead clickbait crap gets everyone’s dopamine going. SF has one of the lowest murder rates in the US of any major city. Why doesn’t that make that the national news every day? Because it doesn’t fit that braindead clickbait narrative. If that kind of braindead crap is all a commenter can contribute here, they don’t need to comment.

        • Depth Charge says:

          That’s a big NOPE, Wolf. You’re wrong on that one. Most states didn’t implement a braindead policy of not prosecuting blatant theft of up to $950, giving criminals a free pass. You get what you financially incentivize, and in this case CA is financially incentivizing criminals.

        • Wolf Richter says:

          Depth Charge,

          “Most states didn’t implement a braindead policy of not prosecuting blatant theft of up to $950…”

          Wrong. The proposition changed the dollar-dividing line between a misdemeanor and a crime. It didn’t say, “don’t prosecute.” It said: when the damage is less than $950, prosecute as misdemeanor not as a crime. That dividing line was increased from $450.

          In addition, what difference does it make whether a misdemeanor is under $450 or $950? None. Threat of prosecution has never stopped anyone from committing a misdemeanor or crime or a bank robbery or a murder. Just braindead BS. If you watch braindead clickbait BS on YouTube, fine, keep it to yourself and don’t throw it up here.

          I’m going to start deleting this crap and blocking commenters who post it. Post that crap on Twitter.

        • drifterprof says:

          CLAIM: Under Proposition 47 in California thefts under $950 will not be prosecuted.

          AP ASSESSMENT: False. Proposition 47 was passed in California in 2014 and reclassified felony theft offenses as misdemeanors. It did not allow shoplifting and petty theft to go unprosecuted.

          apnews
          https://apnews.com/article/fact-checking-160551360299

        • Depth Charge says:

          Thank you, drifterprof. Wolf seems to not like the truth and wants to ban me. And here I love his site and most everything he posts. A shame.

        • Depth Charge says:

          And when I say “the truth,” it’s the fact that the $950 and under being a misdemeanor not a felony has served to encourage more of the behavior. The cops are on record saying that. Talk to any law enforcement in SF or CA. It is what it is.

      • Swamp Creature says:

        I still can’t understand this obsession in the news media about what is going on in California and LA and SF. Turn on any station here including the radio and you get the same repeated video of some shoplifter walking out the door with some crap. We’ve just had a dozen shootings here in broad daylight and you get hardly any coverage. No one is apprehended. The murderers are still on the loose. We have to work here and I’m concerned about the lack of law enforcement. I care about what is going on in my back door not what is going on 3000 miles away.

        • doug says:

          It is the old ‘hey look over there’ trick. I doubt that will change any time soon.
          I record the so called local news and fast forward through the commercials and the non local news. My time watching continues to go down as the BS content increases.

        • LK says:

          California is the chief leftist villain in a national media propogated culture war, particularly Los Angeles (Hollywood located there, chief exporter of culture to the national and international masses) and progressive / liberal sandbox San Francisco in particular.

          Stories that cast what’s happening there in a negative light play into fears people have surrounding changes to their way of life, particularly anything suggesting an erosion of bedrock values like law & order or other societal norms. That gets clicks, not stories happening in your backyard without “national importance.” or some such. Local news is dead and has been for awhile.

          It’s all about the narrative, in this case “Look at what’s going to happen next in US culture” or similar, like a white plight tirade by Tucker Carlson.

          I can’t think of some equivalent for right-leaning or far-right cities because that’s mainly what the establishment already is. You don’t get eyeballs on stories that affirm the culture. Those sort of extremists also tend to blend in well with societal expectations or the dominant group, as opposed to people who express a LGTBQ or marginalized group identity in their appearance that makes them look “different” to the audience being fed the narrative.

        • Sierra7 says:

          Swamp Creature (and others)
          Apprehending shoplifters by store employees is a dangerous life choice.
          Having experienced multiple times doing that thankless task in the retail industry, awakening of management(s) to the fact that more employees were being hurt than worth the publicity or value of the merchandise, it was/is finally decided that path wasn’t/isn’t worth the effort.
          “Inventory Shrinkage” is a fact of life in retail sales. And, it is very crippling to the smaller franchised businesses such as the 7-11’s and similar ones.
          No-ones life or damaged bodies are worth any fraction of the so-called $950 minimal theft boundary before “prosecuting”.
          Management and law enforcement agree.

    • ivanislav says:

      And criminals be stealing dead skin cells from your empty Starbucks paper cup to grow up in the lab for identity theft. Criminality will then require a (VR-based?) bachelor’s in biochemistry and an underground bio-lab. An interesting future, for sure!

    • Kielbasa says:

      “I take it that the intent of science is to ease human existence. If you give way to coercion, science can be crippled, and your new machines may simply suggest new drudgeries. Should you, then, in time, discover all there is to be discovered, your progress must become a progress away from the bulk of humanity. The gulf might even grow so wide that the sound of your cheering at some new achievement would be echoed by a universal howl of horror.”
      ― Bertolt Brecht, Galileo

    • Random guy 62 says:

      Apple Pay Cash.

      My friends all use and it is wonderful.

      I even paid with it at a restaurant for the first time yesterday, simply by taking a picture of the receipt, clicking the tip, and double clicking the side button to activate face recognition.

      For some reason I have never heard mention of this kind of thing as a competition to crypto by the crypto fanbois. It eliminates a lot of the hassles of cash and cards using new tech, but it is still rooted in a leading currency…USD.

      • Russell says:

        No APPLE!!!

        Be very careful with Apple Pay. It isn’t controlled so if you use it with someone you don’t know or trust you have no recourse. Apple doesn’t enforce their service and your bank will just tell you they moved the money to Apple like you requested and their obligation ends there.

        • Random guy 62 says:

          I suppose that’s a risk but banks don’t protect what you do with cash once it is withdrawn either.

          We keep only petty cash in the Apple Pay accounts, so usually $100-500. It is great for splitting bills, spotting a friend who doesn’t have cash at a cash-only place, or paying at a few tech-forward vendors.

          We love it as a digital form of “walkin’ around money”, not an all-encompassing currency replacement.

  9. JV says:

    This is interesting timing because PayPal has just billed my bank for a charge it received for vitamins from GNC which I had ordered but never received. GNC says it never received the order so how did PayPal get the
    bill for them which was then passed onto me? All very disturbing, and I still don’t have my vitamins. The transaction is in mediation right now and they will “get back” to me when they untangle this mess.

    • ru82 says:

      Netflix billed my wife credit card for 13 months. I was paying for Netflix on my credit card but my wife though she was paying for it on hers. We eventually realized we were getting billed twice.

      What is disturbing is my wife does not even have a Netflix user login….etc.

      We called up Netflix and they confirmed that my wife did not have an account and they told us to call the credit card company and Netflix will confirm a disputed charge.

      Guess what. The credit card only credited us with 1 month. This is all messed up.

      • Depth Charge says:

        You both now understand that MOST of these large corporations are fraudsters. MOST.

        • MCH says:

          Only now, young DC do you realize the power of the corporations. There is no resistance.

          ???

          If you squint hard enough, that looks like an angel.

    • sunny129 says:

      I refuse to connect my payPal acct to my Bank account but only to my CC as my first choice. I check everytime When I use PP.

      Corporate over lord are NOT worth trusting!

  10. Do you have to hodl the $25 worth of crypto that you buy for a period of time to get the $25 reward? If not, then it sounds like free money to me. It’s a really smart investment. As I mentioned before, an even smarter investment is signing up for Coinbase. You can get over $30 in cryptos without buying or hodling anything. It’s truly free money. This brings to the dumbest investor group award. The clear winner of this award goes to the Reddit silver apes for the following reasons.

    The first is that their discussion groups reward the most superficial posts with their voting system, so unless you say something like, I’ll buy an ounce of silver for every upvote I get, your comments will remain unread.

    The silver apes made two noteworthy attempts to drive up the price of silver this year, timed in the absolute worst possible way. First, the buying occurred after the price of silver had already doubled and was ready to give back at least some of the gains based on technicals, speculative positioning, momentum, and seasonality. But more importantly, they all tried to buy physical silver at once, driving the premiums to over 20%. This made physical silver the dumbest of all investments because with what other investment do you lose 20% as soon as you make the purchase? (Bullion dealers rarely pay more than spot for your metal, even with high premiums and the average guy on the street doesn’t even recognize what precious metals are, so you can’t sell to them, either.) Maybe when buying a new car or a new dress you take a bigger loss as soon as you make a purchase? Then again, you are likely to have made money buying cars, while the price of silver is down since the Reddit crowd got involved.

    The easy alternative to high preimums, of course, is to buy the ETF to lock in the price of silver, wait for the premiums to come down, and then sell the ETF and buy physical silver when the premiums are lower. Only the fear the that a total collapse of the financial system is imminent could justify buying silver at high premiums. Mints are reluctant to add capacity because investor silver demand is notoriously short-lived. In the worst case, investor demand remains persistently high and then when more capacity is added, premiums come down later. They’ve already dropped from roughly 20% to 12%.

    It’s hard to think of another investment that is dominated by so many irrational salesmen and blind believers of those salesmen. The irony is that if they had picked any rare metal other than gold, silver, or platinum, the squeeze would have been a spectacular success. Almost every rare metal has rocketed higher. Palladium has quintupled in price in less than five years. Rhodium has gone up fifty-fold in less than 5 years (peak to trough). Iridium and ruthenium are way up. These metals have gone up primarily due to industrial demand alone, so any material investor participation would have resulted in a true moonshot.

    The whole premise of the silver squeeze is that paper contracts artificially reduce the price of precious metals when the commitment of traders report clearly shows that the opposite is true. Speculators buy using leverage to artificially inflate the price of silver and when they unwind their bets, the price of silver crashes. Yet every price decline is blamed on evil manipulators such as JP Morgan and anyone who disagrees with this narrative is treated like a heretic.

    One of the unique aspects of pure precious metals is that anyone with a grasp of some basic physics can quickly and inexpensively test the metals for authenticity. You don’t need to rely on an expert telling you so. Yet the average silver ape seems to rely either on faith or opts for the most expensive ways of testing the metals (they’ve driven up the price of a Sigma Metalytics precious metals verifier to over $1000, double what it used to cost).

    They’re all supposed to be somehow rebelling against our spendthrift government, yet the most popular silver coin is the silver eagle produced by the US Mint, which has a face value of $1. Why would I pay over $30 for a coin that our corrupt government says is worth $1? I’m not even trying to be sarcastic. I really want to know. I though they’d be boycotting any money produced by the US government. I haven’t found anyone who is able to provide any explanation at all.

    • joe2 says:

      “It’s hard to think of another investment that is dominated by so many irrational salesmen ”

      Huh? Super easy barely an inconvenience. IPOs, SPACs, stocks, cryptos, diamonds, beanie babies, Hunter paintings

    • Augustus Frost says:

      What you described (attitude toward silver) is a form of religion.

  11. David Hall says:

    Crypto is a security. People who trade it are liable for capital gains taxes, if there is a profit generated by the sale.

    Gold is a collectible. Gains on sales of collectibles are taxed according to capital gains tax law.

    There are all these cryptos doing nothing, with talk of making the dollar a cryptocurrency. People trading foreign currency are subject to tax laws.

  12. ru82 says:

    I received $5 Bitcoin when I opened a Coinbase account. Unfortunately it was when Bitcoin was above $60k. Now my $5 is worth $3.6

    I was going to cash out but Coinbase transaction fee is .99 cents or 27.5% of my $3.6 Bitcoins.

    • Brian says:

      The strike app is awesome. I paid .05, .05, .19 and .03 for 4x$100 BTC buys sent directly to my wallet where I control the keys. I won’t be buying on coinbase anymore, the fees are insane.

      I don’t get why everyone is so down on bitcoin here. Most of the forum is about crapping on the Fed and inflation, which is driven by the Fed’s expansionary monetary policy. Bitcoin is secured by the largest computer network in the world, the code is open source, the supply is fixed, control is decentralized and it relies on game theory and self preservation via aligned incentives to thrive. People don’t tend to shot themselves in the foot on purpose, especially not millions of them at once with their financial livelihood on the line.

      Sure, maybe it could fall apart, or maybe it could keep growing and growing like it has and take down the fiat currency’s one by one.

      The only thing for sure is fiat supply is going to continue to inflate and those closest to the monetary spigot will continue to have their wealth grow at the literal expense of the majority, without their consent.

      Bitcoin may have some warts but fiat is a straight up monster. Maybe it was controlled before, but that’s over with the current age of QE.

      Can you afford to be wrong?

      P.S. I’m only talking about bitcoin here, not crypto, not ETH, not Doge, just bitcoin.

  13. Auldyin says:

    It’s always tempting to ‘take the money and run’ on these cash offers. HSBC offered me £100 to open a telephone C/Ac, it went on for years. There’s always small print that makes sure they get their cash back somehow (fees) before you can do the runner.
    I’ve resolved never to comment on ‘cripto’ because it is of absolutely no relevance to me.
    It’s great being a spectator though, more heat than light.

  14. Winston says:

    I was seriously thinking this was a joke column until I read all the way through. They haven’t gone “Nuts.” They’ve gone “Tulips.”

  15. They’re a platform to buy and sell crypto. No vendors accept it, and you can’t transfer it out. You don’t own the password key either, they do. They want you to buy a little, and when you see how much fun that is you will buy more. This sounds like Microstrategy, that dodgy tech company that the CEO went all in on crypto. Only in this case the customers are putting up the cash. If this leads to a few billion in deposit accounts that adds huge leverage to the company. Smart move

  16. Janna says:

    There’s been some buzz about Greenidge on Seneca Lake in NY. Anyone know if the environmental impacts are true? I don’t know much about crypto other than I’m not interested. I grew up in NY though so I’m interested to hear from anyone who knows more about this.

  17. BigAl says:

    The crypto story morphed years ago from a “cashless payment system story” to an “anarcho-capitalist, anti-statist wealth-preservation story”.

    There is absolutely nothing that dissuades me from my belief that a China CPC-issued gold-back petroyuan digital coin will be the eventual winner here. I’ve no doubt that BTC, ETH, DOGE, etc. will soar to new highs along the way – but there’s no obvious leadership among these already-hopelessly-financialized coins and with China more or less able to dictate the flow of raw materials and finished goods throughout the world in the future – the anarchocapitalists are going to get routed.

    • good points. the ultimate sales appeal is regulation and Beijing is officially opposed to gambling, so they need to loosen up. in the US you will be able to buy pot with crypto (probably). whoever promises the freest crypto will charge the highest fees. and whoever can assign a nominal value to their crypto and make it stick will get the business. the real action might be the exchange rates. those who sell the picks and shovels to the miners make the money. anarcho capitalists go broke.

    • Remy says:

      Yep, the whole world will be lining up to use whatever digital payment the CCP introduces…

    • Brian says:

      Do you trust the CCP to actually link something to gold AND be honest about it? Who’s going to audit the gold reserves?

      • Thomas Roberts says:

        If you pay close attention, he used the term “CPC”, only people that are payed propaagandists by the CCP and Chinese nattionalists (who aren’t necessarily Chinese) use that term.

        China is a little under a third of Asia’s population and a little over a third of its exports. However, the CCP makes up all it’s numbers for China and for alot of things they are simply the final assembly point and don’t necessarily make most of the pieces for things that say made in China. Alot of factories are leaving China as well, because of the CCP’s nonsense. China’s real GDP is declining right now as well, because of a wide variety of CCP caused problems such as terrible flood control and antagonizing the whole world.

        As far as a Chinese crypto goes, they want a digital currency, (not a regular crypto) because it will give the CCP absolute control over it, this is very different from the main goal of cryptos and those who use them. Almost no one outside China, uses the yuan and any digital equivalent, would be even less well received outside China.

        Because, China is trying to punish Australia, the CCP banned coal imports from Australia and so there is alot of power outages ongoing in China. One of the steps China took to reduce power consumption was to ban regular cryptos, because mining them takes alot of electricity.

  18. Depth Charge says:

    Now we’re back to the crypto pump. Wall St. has nothing else.

  19. MCH says:

    Well, that’s technically a better deal than CA state government giving out a lottery ticket if you take the vaccine. ?

    I know, it’s not equivalent. You are right of course, the zoo has gone nuts, I can say with some degree of certainty that it happened in the last decade. Whether it was earlier on or later, that’s harder to say.

    But hey, for the longest time, Coinbase was giving away cryptos as long as you watched their educational videos. With the declining value of the dollar, it’s only reasonable to provide cash incentives. Technically no different than what the credit cards do to sign you up. And here, at least they are honest about the fact that you could lose everything, which is not unlike the banks who doesn’t tell you under no certain terms that you are wholly screwed with the credit cards if you stick with minimum payment plan.

    Plunge Protection… heheh, I didn’t know Chinese regulators were supporting PayPal.

  20. Old School says:

    Another sign of a bubbly top. Here in a country where median new vehicle just crossed $40,000 and median new home closing in on $400,000 all propped up with 20 years of stimulus.

    • MCH says:

      $40k is median price for a car. Holy smoke… just can’t wrap my head around it. We better have moved from hedonic quality improvements to hedonistic features on these cars.

    • Artem says:

      You mean median new vehicle is 1 BTC and median new home is 10 BTC.

      Fixed.

  21. Brent says:

    “In Democracy votes are counted,not weighted”
    Stendhal

    1.How many people read the recent Nassim Taleb’s Bitcoin Black Paper ?

    2.How many people will go for PayPal’s $25 and Venmo’s $10 “Buy-crypto-get-rich-stick-it-up-to-the-Establishment” promo ?

    We may safely assume that BTC will keep skyrocketing today and plummeting tomorrow (steamrolling the sh… out of two bit “investors”) until Sun burns all the hydrogen.

  22. Petunia says:

    The entire country is at peak insanity.

    • Depth Charge says:

      Most people, including the FED and CONgress, underestimated the effects of this many trillions of dollars in stimulus. It’s the most irresponsible mismanagement of the once best economy in the world we’ve ever had. They are systematically destroying the country.

      • RightNYer says:

        I have a hard time believing these people, as dumb as they are, could really think we could print and hand out $6 trillion with no consequences.

        • Depth Charge says:

          These people are dangerous idiots. Janet Yellen, for instance, constantly yammers on about overdoing it rather than doing too little. It’s outrageous that she’s even in a government position, much less one of such power. She is a failure just the same as Weimar Boy Powell.

        • Brian says:

          They handed it out to their friends and sponsors. Do you really think they care or will be held to account for the consequences?

        • Old School says:

          We are in process of crossing the Rubicon of the economy can no longer sustain itself without government deficits. It’s a snake eating it’s tail now.

  23. Micheal Engel says:

    1) PFE is up 3.2%, reaching it’s resistance line.
    2) Good news : PFE new experimental shot #3 will boost the immune system exponentially.
    3) For younger people between 18-55 years old : by x5 times.
    4) For the elderly between 65- 85 years old : by x11 times.
    5) Shot #3 is a new EV battery.
    6) Unfortunately, for the eldrly, PFE shot #2, taken 5-6 months ago, decay 80%.
    7) Shot #3, #4…. will boost the immune system higher and higher, to a new all time high, forming a bubble. Bubbles make people happy.
    8) Bubbles are better than a sagging immune system with lower highs and lower lows.
    9) PFE will replace our own immune system from early age. All we
    need is another booster shot, in shorter and shorter intervals, to make us happy and healthy.

    • Cobalt Programmer says:

      Third dose is not useful because, the covid virus will mutate and change in to a form to spread among the vaccinated people. Third dose will be based on the past covid virus sequence. Also, the newly mutated virus will not harm the already vaccinated people much. For example, the flu vaccine is prepared evrey year for new batch of virus. But who knows…

      • The artist formerly know as Marcus says:

        Influenza and coronavirus are apples and oranges as far as vaccines. Flu has a segmented genome enabling massive genetic shift from season to season and it has a large multi-species zoonotic reservoir allowing inter-species variant mixing. The current coronavirus vaccines have already been proven to be vastly superior to seasonal flu vaccine.

        Yes, mutants can be a problem, but history is full of successful vaccine campaigns against diverse viruses (polio, smallpox, measles, mumps, rubella, rabies, hepB, etc). These viruses all have different mutation rates, yet the vaccines have worked for decades. So, let’s not rely on anecdotes to undermine the extraordinarily safe and effective mRNA vaccines for coronavirus.

    • Anthony A. says:

      Two shots of MRNA here. PayPal since 2000. No $25 BTC letter yet!

    • MonkeyBusiness says:

      Supposedly after a couple of shots, your body will be able to mine Bitcoin.

      Paypal can’t match that.

  24. Brent says:

    To understand BitCon (and many other things financial) all you have to do is to read an old,long-forgotten book “The Big Con” (1940)

    It is a treasure trove of American slang ( the write, the rag, the payoff, ropers, shills, the cold poke, the convincer, to put on the send etc…).

    1. Locating and investigating a well-to-do victim. (Putting the mark up.)

    2. Gaining the victim’s confidence. (Playing the con for him.)

    3. Steering him to meet the insideman. (Roping the mark.)

    4. Permitting the insideman to show him how he can make a large amount of money dishonestly. (Telling him the tale.)

    5. Allowing the victim to make a substantial profit. (Giving him the convincer.)

    6. Determining exactly how much he will invest. (Giving him the breakdown.)

    7. Sending him home for this amount of money. (Putting him on the send.)

    8. Playing him against a big store and fleecing him. (Taking off the touch.)

    9. Getting him out of the way as quietly as possible. (Blowing him off.)

    10. Forestalling action by the law. (Putting in the fix.)

    I can even tell what happens when BTC fizzles out.FBI & SEC will stage a show.And save the world (again).

    • Depth Charge says:

      BitCON is just that – a CON. A scam. A Ponzi – call it what you want.

      • Brent says:

        ?

        Sometimes beautiful flowers grow on heap of manure.Even if BTC collapses into Black Hole it will still leave an indelible mark on many areas of research.

        Even I bothered to read a couple of popular books on modern cryptography and discovered such interesting things as,say, Elliptic Curves.

        Imagine-it is possible to add & multiple points ! Located on curves of all places ! US Congress should pass “Elliptic Curves Law” ASAP !!!

        One BS law more,one BS law less,it will change nothing.At least they will not look like total idiots if,instead of taking knee and covering their faces with bandannas,they will be discussing math formulas on the blackboard.

  25. buda atum says:

    “And yes, I checked if this was from that infamous Nigerian colonel that had been offering me fortunes that I have been missing out on.”

    Damn! I’m so good at this that Wolf can’t tell I sent it from Ajegunle in Lagos, Nigeria.

    Perhaps I’d start commenting here as Nigerian Colonel so you know it came from me.

    • Wolf Richter says:

      I still get a few of those offers a week in my inbox. But now they’re more diverse: women, countries other than Nigeria, other strategies… I should follow up on one of them and see what happens and write about it.

      • Tanstaafl says:

        Watch James Veitch, the british comedian, who tries to buy 25 tons of gold, iirc, from the nigerian colonel’s superiors.

      • Masked Ghost says:

        Please do. I would be interested in reading about it.

      • buda atum says:

        Yes Wolf, you should.

        Do a few perhaps so we see what country they are from too please.

        • Wolf Richter says:

          Some of them actually get prosecuted in the US for money laundering and other things. We just had another one. Google: Nigerian hushpuppy scam.

  26. Saver says:

    I had sold something on Ebay and got paid around $100, this was when Paypal first launched accepting bitcoin, I said “never had bitcoin” so why not just try this, it was when it was 58K. When I bought it I think they charged 2.5% or something ridiculous. Well this is worth around $50 now and I will have to pay another 2.5% fee to cash out, what a scam, this has to be the worst place to buy bitcoin, essentially you have to make 5% on each trade just to make up for fees.

    • Depth Charge says:

      Could I interest you in some DoggyCON? How about some sweet Shiba Inu CON? Just HODL. It’s rad, mmmmmkaaaaayyyy?

  27. Swamp Creature says:

    When I got hacked by Cryptolocker in 2013 they wiped out all my pictures on my hard disk and my thumb drive. They wanted $300 payable in Bitcoin. It told them to go f$ck off.

    I used Malwarebytes to get rid of the virus. Never recovered my files.

    • Too bad there are so many chicken who pay the ransom and encourage them to keep trying.

    • Swamp Creature says:

      Lesson learned the hard way

      Don’t leave your backup disk in your computer. Cryptolocker got my backup.

    • Anon1970 says:

      Malwarebytes has a paid version that attacks a virus before it is able to ruin your files. I have it installed on my computer and think it is worth the subscription fee.

  28. For crypto, forget about paypal, coinbase, robinhood because there is now a better one stop shop: b*****i pays interest on your crypto holdings, allows you to send/withdraw crypto and links to normal bank accounts.

    Downside is that you don’t have the keys but that’s the same with all the former companies – at least you earn interest while they lend it out.

    Note: blocked out vendor name because I didn’t want post to seem like an ad.

  29. Anon1970 says:

    Check your credit card statements every month for suspicious entries. If you are sloppy with your financial records, don’t be surprised if you get ripped off. Be especially careful with gym memberships and other organizations with monthly membership fees. If you cancel a membership, get an acknowledgement from the business in writing or at least follow up with an email to the business that you are cancelling your membership.

    • doug says:

      Gym memberships always try for at least one more month, and always take forever to correct it, if they ever do. There are often some insidious clauses in their contract. Want to go to the gym? Then sign the contract, you will.
      Anon’s advice is very good, get it in writing, despite them telling you it is not necessary.

      • Anon1970 says:

        If you think your former gym (or any vendor) has ripped you off, complain to the credit card issuer. If your complaint is legitimate , the card issuer will reverse the charge. Unfortunately, many people are not very good at handling their finances.
        When a friend of mine inherited a retirement account (he was the named beneficiary), the brokerage firm was very slow at processing the paper work to transfer the account and made it almost impossible to speak to a real human. I contacted the self-regulatory agency FINRA and a few weeks later the transfer did occur. FINRA has a special hotline for seniors at 1-844-574-3577.

  30. Artem says:

    A casino will give you a free hotel room if you promise to gamble.

    A drug dealer will give you your first hit at no charge.

  31. Yort says:

    The entire Wall Street construct is one giant Ponzi “get rich quick” scheme, falsely backed by the Fed, with Nikola founder Trevor Milton being the poster boy of how to make billion via societies current “something from nothing” mantra. We are all tools now…

    Per CNBC:

    A federal grand jury charged Nikola founder Trevor Milton with three counts of criminal fraud for lying about “nearly all aspects of the business” to bolster stock sales of the electric vehicle start-up, according to an indictment unsealed Thursday.

  32. RedRaider says:

    Been day trading bitcoin the last couple of months via GBTC. I made a tidy sum. Luv that volatility!

  33. Island Teal says:

    PayPal = Peter Thiel, Elon Musk.
    What more needs to be said ???

  34. Milton W Berg says:

    Wolf

    I couldnt stop laughing. Well done.

  35. Cambric Finish says:

    “Earn a $25 reward when you buy $25+ of crypto with PayPal.”. But would Peter Thiel and Elon Musk approve? Thiel, the libertarian, so buyer beware if you don’t read the terms and 6000 pages of legalese, And for Musk, part carnival barker, step right up and see the amazing “Crypto” perform feats of technological wonder right before your eyes.

  36. Sweet Kenny says:

    I dumped PayPal when I was defrauded by a PayPal partner and PayPal didn’t care

  37. Mr. Wake Up says:

    Got to love the WS comment section.

    Came here for the article and learned that the murder rate in SF is low. That’s an interesting point one of more value than the poop patrol or the needles, homeless and the fact that anyone can walk out the store with up to $950 in goods, all are unfortunate circumstances of what will continue to be a part of the pain and suffering society will continue to experience.

    Unfortunately pointing fingers and getting upset at characters we have no interaction nor physical connection just contributes to the divide and conquer strategy put forth on the masses.

    Make the best of each day be grateful for what you have the rest is outside of our control unless you choose to focus and expand on making a difference.

  38. steve bellagio says:

    New World Order is crypto based. That should be a big enough clue

  39. Dave says:

    I pay my house cleaner in bitcoin directly, and occasionally I sell some on a better exchange than PayPal in order to buy something, or take some profits. It costs about $1-5 to send a transaction on the blockchain, and that is likely to scale with the price of one bitcoin, with spikes when there is a frenzied blow-off top.

    Bitcoin was supposed to go to 100k last year. It was also supposed to go to zero. But you still don’t need anyone’s permission to use it, other than the permission of whomever you are transacting with. And to my knowledge, if you hold your own keys, nobody can freeze or confiscate your bitcoin. They can take it as soon as you send it to a compliant exchange, though. That’s how some ransomware payments have been reclaimed.

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