Only when the tide goes out you discover who's been swimming naked

It is perfect to describe the recurring theme of centralised crypto entities who flourish when times are good, only to find their shaky foundations, supported by floods of liquidity during the good times, exposed in the retreating tide of the crypto winter.

During the irrational mania of the bull market, crypto custodianscan grow exponentially by doing shady and risky things with depositors money. Even if they lose the money, insolvency carries little risk as the bull market is always full of new depositors providing the money to honour withdrawals. Greedy founders steer their seemingly trustworthy entities deep into ponzi territory.

The unrestrained sociopaths who see no moral obligation to protect their customers become filthy stinking rich because everyone wins in a bull market right? Then they cosy up to politicians and regulators seeking ever more power and clout.

But the bull market doesn’t go on forever, and unlike the fiat world, where zombie companies are propped up by taxpayers, the crypto industry has proven to be effective at flushing out the underhanded, deceptive actors in the onset of the bear market.

If you’re wondering where the yield comes from, you are the yield

The cynical amongst us

To save face and maintain the illusion of being in control, they deflect blame from themselves by pointing the finger at difficult market conditions. In the postmortem, their rotten balance sheets get exposed to all and it becomes clear that they were swimming naked the whole time. This is why bitcoiners say bitcoin, not crypto. Satoshi, with his invention recognised that the greed and corruptibility of humans can never be a factor in a fair monetary system. Money should never be centralised into the hands of of human controlled entities, corruptible by greed and coercion. Bitcoin stands alone as a truly decentralised monetary protocol. Everything else is about as ugly as a naked Warren Buffett.