And the stories concerning the dark side of cryptocurrencies keep coming:
In 2018, Alex Mashinsky held a dinner at an upscale restaurant in New York. The entrepreneur’s goal was to attract “whales” — crypto-speak for large-scale currency holders who can move markets — to invest in a nascent entity he’d created called Celsius Network.
The Ukraine-born, Israel-raised businessman spoke charmingly and passionately, according to a person who was at the dinner and described it on the condition of anonymity because it was a private event. He laid out his mission of “unbanking,” in which investors can deposit cryptocurrency outside the traditional financial system. Central to the pitch were unusually high yields for depositors in his Celsius Network — as much as 30 percent — made possible, the New York-based Mashinsky explained, because their money would be loaned out at high rates to those needing it for short-term crypto investments.
“It was incredible to watch — everyone in the room was enthralled,” said the guest. “The whales were excited and ready to write checks. Even people who might have been skeptical were on board.” [WaPo]
Sounds like a classic grift. Charismatic representative, referencing utopian ideals and, more importantly, appealing to the dark side of the human, or at least Western, psyche: Greed. Replace whale with mark; whale is far too euphemistic. If you don’t know the what of a mark, go look it up and get out of crypto now, and don’t return until you’ve learned to sniff out the con man.
Still having doubts?
Yet many of Mashinsky’s adherents have refused to give up. They see the freeze not as a sign of malfeasance but as one more piece of evidence that traditional finance wants to destroy crypto and will stop at nothing to realize its aim.
“Everyone take a look. If this is true, it’s a coordinated attack to take Celsius out. My anger is not at Alex & Celsius but at the short sellers. Spread the word!!!” said a user with the handle @evanrodts, referring to a theory that the company has been victimized by those betting on its failure.
“I have all my savings in Celsius because I trust your company,” noted the Celsius advocate @MichalMike18. “Please pull through.”
All set to throw good money after bad, which is a classic psychological symptom of someone thoroughly taken in. Even if this wasn’t a grift – and guaranteeing 30% returns sound like a grift to me – those with stars in their eyes are acting out, while others are going to swallow their losses and never say a thing.
Ego has its day.
