Cryptno: the moral failings of cryptocurrencies and allied tech

It’s always a solution in search of a problem. In theory, could there be a useful applications? Maybe? Let’s see. Bitcoin was released in Jan 2009, and fourteen years later all we have is scams and failures. HTML was released in 1991, and fourteen years later we had Google, Amazon, Ebay, geocities, webmail, videos, blogs …

The fundamental moral failing of all this tech is the idea that you can magic something out of nothing. Like I said above, the value of money doesn’t come because a government wills it into being—as is implied by the term “fiat”—it is because governments do stuff that creates value in peoples’ lives. That creates trust in government. When government money fails because governments are bad, the solution is not to replace government money with pixie dust, but to build a better government. And that takes people you can trust. To imagine you can replace trust with code is purely a technocratic fantasy.

Build a nation with crypto and we’ll talk.

Obviously less energy consumption is less bad. But since the economic, moral, and social value of crypto is also negative, it just makes it “marginally less terrible”, not actually good.

Anyway, there’s a better way of reducing crypto power consumption. Stop using it.

I discussed using blockchain for monastic proof of identity with other monks literally a decade ago when I was still at Santi. The problem is, no-one cares about your theoretical tech proof of identity. What matters is trust. They’ll believe someone is ordained because they know someone at the other monastery. There’s no practical problem here, it’s easy to identify scammers, the issue is how do you deal with it. But if I saw a monk who tried to prove their identity with an NFT, I would immediately tell them to leave.

We should be trying to build a world with more trust, where the relationships between people are less transactional, not just giving up on humanity. The whole drive to replace human connection and relationships is based on a collapse of faith in humanity, and a naive belief that we can rebuild using code.

In addition to being a moral and spiritual failure, crypto is always a technical failure, because at the end of the day a human being holds the keys to the kingdom. And in the world of crypto, that human being is a scam artist, a fraudster, and a criminal. Every last one of them. This is not an incidental detail, it follows from the premise. If you build a system based on not trusting other people, the system will end up being run by untrustworthy people.

SBF is not an outlier, he is the norm. Here’s yet another excellent article by Stephen Diehl, who has been the most consistently incisive commentator on this field, with an excellent grasp of the tech, the economics, the history of ponzi schemes, and the human dimension. And I don’t say that because he liked my talk. Or at least, not just because he liked my talk!


Oh I miss Geocities!
But I guess there is a fundamental difference between the two periods as well. To use a concept in ecology, perhaps the earlier period already filled up all the sustainable ecological niches in the internet ecosystem. The earlier period also started with a vacuum/blank slate, where the ecosystem wasn’t populated with existing species.

Whereas Bitcoin & its ilk are entering an ecosystem with existing species filling up all the good niches and watering holes.

Well, arguably, code is about the magic of creating something out of nothing. :slight_smile: Not sure it is necessarily immoral, though! I mean, if not for code, Suttacentral wouldn’t exist, and I would be…
-cannot imagine the darkness of that parallel universe…-

Interesting that you had discussed blockchain for verification ten years ago!

I fully agree with you that the web3 enthusiasts’ frame that you can replace trust in humans with trust in code is a fool’s errand.

However, I think what is missing from your comment is about the relationship between trust and scale. It’s easy to identify scammer monks in Australia: it is a completely different ballgame in the wider Asia, where sometimes even entire companies get pirated and copied. And the problem gets worse if you’re a lay person who isn’t plugged into the BNN (Bhikkhu/Bhikkhuni News Network): how are you to know someone in that other monastery, in a country where you don’t speak the language at all?

And it is precisely when scale grows big, that institutions which serve to validate and verify come in. Like certificate issuers.

So perhaps the value of crypto isn’t about replacing trust, but in reinforcing trust at larger scales?

I think the interesting intersection would be combining blockchain with local-scale trust.

The failure point will likely always be the human being, regardless of the technology or institution. So what you wrote above also applies to large institutions.

But I don’t think it is necessarily true that every crypto human being is a scam artist, fraudster or criminal, or that it follows from the premise. The nuclear disarmament treaties that led to limits on nuclear weapons on the US and USSR were famously underpinned by the Russian proverb made famous by Ronald Reagan: trust but verify. A successful verification, in turn, generates more trust. You can start out with little trust, and eventually build it up.

That made me LOL! :laughing:

Well, it didn’t take too long …

We allege that Sam Bankman-Fried built a house of cards on a foundation of deception while telling investors that it was one of the safest buildings in crypto," said SEC Chair Gary Gensler

More to come no doubt…

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And this is what crypto enthusiasts have been struggling with for more than a decade: how do we find a problem for this solution?

It could have been shorter!

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I was away over December so didn’t see this particular post until now.

@sujato I’m a bit disappointed to see that your talk has been re-posted without any attempt to rectify the factual inaccuracies raised here.

Btw - starting the video with “don’t listen to anyone else except me” doesn’t put it in a positive light as it effectively tells people to switch off their critical thinking facilities. People should, as much as possible, do their own research on this and make up their own minds.

For anyone who would like to dig deeper into FTX and SBF, I recommend the this video that explores the collusion between FTX, politicians and banks. If you think that crypto is at fault, this provides a different perspective. Some parts of it are based on fact, others on inference and a bit on hearsay. But it is a fascinating watch.

A) stop shilling crypto, it’s a scam and it is eating your soul
B) the video is accurate
C) nothing was reposted
D) "listen to me"is a joke


@sujato I am not shilling. I’ve been repeatedly saying that people should read, research and find out more for themselves. The fact that you or others don’t like crypto doesn’t bother me. What bothers me is the lack of integrity in the way an opinion is presented as fact. You are in a position of power where a large number of people may follow your advice without question. This requires words to be spoken with due consideration for both the content (i.e. is it factual and well researched?) as well as the inferences that may be drawn from it (i.e. will the conclusions drawn by your audience be correct?).

The full list of inaccuracies are here.

The theme I see is that you make broad generalisations that lead to an uninformed individual drawing the wrong conclusions.

For example, take your statements on mining energy usage. The general tone of your talk is that mining is a waste of energy and resources, however that argument is flawed. How would people perceive mining if they realised that all the televisions and other appliances on standby in USA could power the Bitcoin network for multiple years? This study by The Cambridge Centre for Alternative Finance (part of the University of Cambridge) provides some good insight.

A quote from the list linked above is below, to refresh your memory on just one of many previously discussed inaccuracies.

7:09 min: Mining gets harder as you go on and require massive server farms to solve these problems.

This is incorrect. Bitcoin mining difficulty doesn’t increase as a function of time. It increases as a function of the number of miners, which is related to price.

Every 10 minutes, the Bitcoin network releases a certain number of Bitcoin that the miners can take. Miners compete for these Bitcoin by trying to solve an algorithmic puzzle. Whoever solves the puzzle first gets the Bitcoin that is released. The miners are then able to sell the Bitcoin they have gained in the open market to make money. The profit they make is the money from the Bitcoin sale minus any costs incurred to run their computers.

The utility of miners is that they engage in a consensus mechanism to secure the network against bad actors. In layman’s terms, they stop other people from stealing your Bitcoin.

The more expensive Bitcoin gets, the more lucrative mining becomes; therefore more miners add their computers to the network to try and gain a share in the profitability. This is a good thing because miners secure the network from bad actors. The more valuable Bitcoin becomes, the more bad actors might try to attack the network to steal Bitcoin. But the more miners that are drawn to the network, the less likely bad actors will be able to succeed.

The reason that power usage has, on average, increased within the Bitcoin network over time is because its price has also, on average, increased.

Yes it was. Here is where the video was originally posted. Below that post is my critique.

As mentioned before, your are in a position of authority. Literally starting the talk with something to the effect of don’t listen to others, only listen to me is not something to be taken lightly. Can you be 100% certain that at least a few people in your entire audience won’t take your words literally? If they do take your words literally, will you take responsibility for any negative consequences that arise from following your advice? The problem with these kinds of jokes is that they benefit the speaker both ways. If the speaker is right, the speaker gets praised for dispensing sage advice. If the speaker is wrong or is challenged, he or she can say it was a joke and avoid taking any responsibility.

To be clear, I’m not saying that you did not genuinely intend it to be a joke. I’m just pointing out that there should be some consideration for people who will take your words as gospel and potentially face negative consequences due to any inaccuracies in the statements you make.

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“Hey” says the carnival barker, “inside this tent is a genuine wonder, half human, half alien. But don’t take my word for it, see for yourself!”

Crypto is a mind virus that feeds on the basest forms of greed and conceit. It creates a feverish disconnect from reality, fuelling a form of collective insanity. It has no redeeming features and no real world applications except doing crime and fraud.

Stop shilling scams.


That is a laughable analogy… the use of that kind of straw man argument speaks to the lack of integrity I spoke about. Another area where a lack of identity can be seen is that there was no acknowledgement of points that I made that are unambiguously correct (e.g. the fact that you did, in fact, post the video before).

To deconstruct your analogy:

The scam with the carnival barker is that they require an entry fee for people to see for themselves. By the time you realise that there is no half human half alien, you’ve already parted with your money.

Researching crypto on the other hand does not require people to part with any money. It simply requires time to read / watch videos on topics such as economics, blockchain etc. and follow the news. Now, if there are people here who can’t trust themselves to make investment decisions objectively, I would tell them to stay away from crypto and other investments for the time being because investment requires a disciplined mind. But that is a very specific case.

Note - I am not saying that people who don’t invest in crypto or other investments lack objectivity and discipline. Simply that a lack of objectivity and discipline will lead to losses in any kind of investment. In such a circumstance, it makes sense to be wary of jumping too quickly into anything.

More unsubstantiated statements. For crypto to feed, it must be alive. It is not.

If you mean that thinking about crypto leads to greed, conceit and insanity, that is again a straw man argument. Picking up anything in the wrong way leads to greed, conceit and insanity.

Even the Dhamma, when picked up wrongly leads to greed and conceit. The recent actions of a monk who lived in my city comes to mind. He used his robes as an excuse do as he pleased and treat people poorly. He would criticise people for not following Dhamma and would conveniently gloss over his own shortcomings, to the point of blatantly lying about his virtue.

Your line of argument seems to be very similar to the one in your video where you say crypto is inherently evil. Things can be used to perform evil or good actions, but nothing is inherently evil or good in and of itself.

I have provided evidence to the contrary, but you dismiss it as “shilling” rather than providing a logical and defensible argument to disprove my points. This is again more evidence of a lack of integrity on your part.

I will try again and present another benefit of crypto, although I feel at this point that it will fall on deaf ears. Stable coins have resulted in many people in the world getting access to US dollars, which were difficult to get previously. The USD is attractive to many people because it is a hedge against inflation of local currencies. This is a real and present benefit. The flip side to this of course is that the organisations providing stable coins are relatively new; and because regulation and enforcement mechanisms haven’t caught up, there is some risk to holding stable coins. Regulation of these organisations is not as robust as regulation of banks. Still, for people whose local currency is collapsing, the risk may be worth taking. Eventually, the danger will pass, as people come up with better and better ways to ensure the trustworthiness of coins and their issuers.

There are many aspects to crypto, each of which has a different risk/benefit profile.

All I’ve done is provided some counter-factuals and advised people to acquire knowledge and think critically about the topic. You, on the other hand, have made statements such as stop shilling crypto, crypto is evil without anything substantive to back that up; but people will only see this if they do their own research to cross check your statements.

You make statements that are indefensible, that are based in “facts” that are either strung together in a misleading way or are plain wrong. If anything, you’re just shilling your own views.

I’ve raised my concerns about following half baked advice dispensed by someone with neither the domain expertise to provide advice nor the integrity to admit that their opinions are simply opinion and not fact. It is now up to each individual to decide whether they want to make the effort to inform themselves.

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Dhamma012, try to chill a little bit. Keep in mind that this space that we are in, this forum that was built (with help from others) on the shoulders of Bhante Sujato’s years in isolation translating from the Pali these Early Texts, is a labor of sweat, tears and love, and a temple that we as guests are privileged to be a part of. If there is an issue of integrity, I know of no one with more integrity and compassion that Bhante Sujato, who has stood up for the Dhamma, for women in the Sangha, the marginalized, for the suffering citizens of this increasingly toxic world.

If the crypto hill is the hill you want to die on, or at least fight a fervent battle on, consider that Sutta Central is really not the place to do that. To some of your points, I own some crypto, in large part to be able to jointly ride out a wave that has captured the energies of some millennials ( my son included) that bought into some coins. It’s a hobby that my son and I can jointly follow and chat about. Having said that, I fully expect one day to see that my small holdings in this digital currency could be wiped out overnight some day. See

So, dhamma012, try to just absorb the respectful context of this Dhammic space, and try to appreciate that you and Bhante Sujato might have opposing perspectives on this crypto issue, but that there’s still room in this space for some contextual insight and some old fashioned respect. Too often, with monastics, we get a level of passionless, sometimes mild types that really can’t get us to the heart of this Practice. With Bhante Sujato, we have a man with passion, with intellect and Metta, with a healthy edge, and with the scholarly and Dhammic chops to get us all ever closer to an understanding of the Dhamma. Celebrate this straight talk, and see if you can find the space to not be so reactive in this remarkable temple.


Dhamma012, I read through your response carefully. I’m reminded of what I do in my day job. I’m a family lawyer. Many days, I am listening to a lawyer or a parent argue endlessly a counter-argument, when the big picture best interests of the case, or the holistic best interests of the parents and children, really didn’t need another argument or an elevation of the discord. Sometimes, we just need to let go. Sometimes, we just need to hold our thoughts, and let life go on peacefully. Sometimes, with a sense of Metta, we need not get the “last word,” or a perceived win in the argument, but are content to just let go of the discord, and cultivate some friendliness and peace. I am grateful to be in this “digital wat,” grateful for Bhante Sujato and so many others here. May all of us here, you included dhamma012, be well, happy, and peaceful. I’m not trying to be condescending here, or bypassing the issues. Sometimes, with the Dhamma in mind, it is just better to let go and find peace.


Upasaka Michael; for the most part, I have no animosity towards Bhante Sujato. Sure, I didn’t appreciate it when he disparaged my character but that kind of displeasure comes and goes.

I wanted to ensure that people would think critically before following Bhante Sujato’s words (or anyone’s words for that matter), because depending on the topic at hand, the stakes can be high. I also wanted to be direct about the objections I had about Bhante Sujato’s approach to make it clear what the pitfalls were. Having done what is possible, I am content with that.

As a lawyer, you probably see your fair share of people arguing to preserve their pride or to make the other person suffer. That is counter productive, and hopefully you can see that was not my intent. It was motivated by good-will / metta toward the audience that might be reading / listening to Bhante Sujato’s comments. There was also some ill-will towards Bhante Sujato’s behaviour as well but, as for most people, that is a work in progress.

On getting in the last word. This one is tricky. At what point in this discussion should I have stopped? When he implied that I was trying to perpetuate a scam? When he presented an inappropriate simile to compare me to a carnival barker out to get people’s money?

As I said, much of what he said were not out and out lies but misrepresentations. If I had let those comments slide, an uninformed person might have concluded from the discussion that Bhante Sujato’s advice should be followed.

If the only result of his comments was simply the damage to my personal image I could have left the conversation at that. But the potential damage was more wide ranging.

The price for maintaining silence in the name of friendliness and peace is that the harmful ideas end up perpetuating without being checked; leading to the harm of those who act on them. I take your point though, that at some stage the conversation must come to a close.

Thank you for taking the time to read through my previous post carefully, and engaging with me on this topic. May you be well too.

The future of money, they said. Unhackable, they said. Secure, they said.

… etc.

100% scam, 100% of the time.


What a thing to say. To quote the film Two Weeks Notice:

Lucy: George, I think you are the most selfish human being on the planet.
George: Well that’s just silly. Have you met everybody on the planet?

Below are the nuances that you seem to overlook each time. Please read a bit more before posting articles that create mass fear. Creating fear is what media is good at doing, and what gets them paid. There is no need to help it along.

Euler attack causes locked tokens, losses in 11 DeFi protocols, including…

Hackers steal around $200 million from crypto lender Euler Finance

Different crypto protocols make different tradeoffs. Often, the tradeoff is between security and speed. Readability of code also becomes an issue, as lack of readability leads to bugs. This does not mean that crypto is a scam, just that some protocols and platforms are buggy. This is no different to software that was developed for the financial sectors.

De-Fi protocols are incredibly new, so the space will take time to mature. There is also an open question on whether De-Fi protocols can be truly decentralised, due to their complexity. However, De-Fi is only a subset of crypto.

Take Bitcoin as a contrast. It’s been around for more than a decade and has not been hacked. This is because the engineers prioritised security above all else. It means that it doesn’t have all the functionality of other crypto such as Etherium, but that is the tradeoff made. Incidentally, that is why institutional investors took interest in Bitcoin.

If Bitcoin gets hacked, then the crypto experiment will likely be over. But a decade plus is a long time for the protocol to go unhacked, particularly when hackers have had plenty of incentive to try and steal Bitcoin.

Signature Bank Is Shut by Regulators After SVB Collapse

BlockFi has $227 million in uninsured funds in Silicon Valley Bank

Crypto Bank Silvergate Capital Says It Will Shut Down; Stock Plummets

Crypto is about decentralisation. SVB is a good example of what happens to depositor’s money when a few bad financial actors control how it is invested.

SVB was known to be a small bank with very bad financial controls. Crypto was the catalyst, but the actual reason was that SVB had very bad financial controls. It is common knowledge that crypto has swings of 80-95%. This should have been taken into account. Incidentally, the reason that they were able to get away with bad financial controls was because SVB is too small to fall under certain US regulations and audits.

Btw, I was recently at a conference that discussed crypto at length. In it was a person who almost lost $60 million due to SVB. No blame was assigned to crypto. Participants knew that it was SVB’s incompetence that caused its decline. The CEO of the company that almost lost the money ended up firing their CFO, for not doing their due diligence and putting all $60 million in a small unregulated bank.

Both Silvergate and SVB had a significant amount of funds invested in high risk assets such as mortgage backed securities. This led to their undoing. From Washington Post:

Large banks must keep enough high-quality liquid assets to cover 30-days’ worth of deposit withdrawals under stressed conditions. JPMorgan Chase & Co., for example, held $733 billion of such assets at the end of 2022 against $2.3 trillion of diverse, traditional deposits…

… Silvergate took more risk. It plowed most of its new funds into longer-term securities. By the end of the third quarter last year before deposits started to shrink rapidly, only 11% of what should have been its most liquid assets was cash at the Fed and other banks with the rest in securities. Only 11% of those securities were Treasuries. Most of the rest were mortgage-backed bonds with contractual maturities of more than 10 years. Its bond holdings had suffered $1 billion of fair value losses before Silvergate began offloading them to meet withdrawals.

The cause of the collapse was a bank run that forced Silvergate to liquidate its assets at below the price that they bought them for. This would not have happened if they had done their due diligence.

Huobi Token Plunges 90% In Minutes, Sparks Insolvency Rumors |

There are many small cap tokens that behave like this. It can’t be used to classify crypto as a whole. Half of the crypto market cap is just Bitcoin.

WSJ News Exclusive | Crypto Companies Behind Tether Used Falsified Documents…

Tether is not a crypto. It is a service created to allow people to access crypto more easily. There have been rumours that tether weren’t being transparent about their dealings, so this article isn’t surprising. The link between crypto and the financial sector via stable coins is definitely a weak link that requires rethinking; likely through stronger and more robust regulation. However, Tether is not a crypto, as it is not decentralised. It just provides a convenient means to trade cash for crypto.

Indian Crypto Exchange BitBNS Says Law Enforcement Advised Against Making…

Once again, this is a centralised exchange that requires regulation. It is not decentralised, and while part of the crypto ecosystem, it is not a crypto token.

FTX’s Singh pleads guilty as pressure mounts on Bankman-Fried

SBF is a good example of how centralisation goes wrong. We need centralised entities to allow us to access crypto, at least right now. Crypto related entities will eventually be more regulated and more closely scruitinised. This will be a good thing. For now though, things will be bumpy.

More than 90% of companies that took part in the .com craze in 2000 are bust. Billions of dollars were lost and some people lost everything. Does that make the Internet a scam?

Crypto firm with links to parliamentary groups appears to have vanished

Once again, an example of a centralised entity that was not scuitinised and regulated closely enough. Decentralisation (i.e. crypto) is the solution, not the problem.

Final thoughts

If you wish to criticise something, define it and make the necessary distinctions. E.g. Bitcoin vs other crypto currency, centralised vs decentralised operations, correlation vs causation etc.

You cannot simply take any negative article that uses the word crypto as evidence that it is a scam. At best it is faulty logic and at worst, disingenuous.