Were Many Libertarians Taken In by FTX Scam?

When it comes to the recent collapse of FTX, many have asked if this has affected libertarian individuals. On one hand, Kevin O’Leary's experience may be seen as a shocking outlier. However, upon deeper examination, it is clear that the majority of libertarians are highly skeptical and have been cautious about platforms like FTX.

The Myth of an Easy Rider

Many believe that libertarians were quick to fall for the promises of FTX. However, in my experience, this is not the case. Libertarians tend to be more critical and aware of potential pitfalls. In fact, most of those I know have long been using Bitcoin and have experienced the ins and outs of the cryptocurrency world, allowing them to be more discerning.

The Value Propositions of Crypto

When discussing the value proposition of Bitcoin (BC), it becomes clear that the perceived problems are indeed significant. Since the value of BC is essentially 0, one would be hard-pressed to justify holding it for a long-term investment. Yet, the libertarian attraction to Bitcoin lies in its decentralized nature and potential to circumvent government control, the very thing that many see as inherently flawed.

Consistent Principles

Despite the eventual worthlessness of Bitcoin, some libertarians still believe in it due to their ideological stance against government control. However, the importance of decentralization must be balanced against practical considerations like security and usability. Libertarians who are keenly aware of the importance of having "not your keys, not your crypto" (as succinctly put in popular phrases) are more likely to avoid risky ventures like FTX.

Even when considering the broader landscape, it is evident that the community is highly critical of crypto platforms. Libertarians are cautious due to:

Not Your Keys, Not Your Crypto: This principle is paramount for libertarians, ensuring that they retain full control over their assets. Triangle of Security: The belief that anyone associated with the crypto space is potentially dubious. Results and Real Customer Reviews: A strong emphasis on tangible evidence and consumer feedback, highlighting the importance of due diligence.

The Challenges of Delegated Trust

At the heart of the libertarian skepticism towards FTX and similar platforms is the challenge of managing delegated trust. Decentralization offers a powerful alternative to centralized systems, but it also means that users are responsible for managing their own security and compliance. The issue is compounded by the complex and often opaque nature of many crypto platforms, which can lead to vulnerabilities and potential scams.

Conclusion: A Cautious Approach

While the libertarian community has shown a strong interest in the transformative potential of decentralized technologies, it is evident that this interest is tempered by a healthy dose of skepticism. Platforms like FTX, with their significant weaknesses and potential for fraud, have not succeeded in converting many libertarians into trusts or investors in a rush. Instead, the community remains cautious, preferring to hold on to principles that prioritize security, transparency, and decentralization.