The Crypto Crash: all Ponzi schemes topple eventually | Robert Reich

But at some point, Ponzi schemes topple of their own weight. When the toppling occurred in 1929, it plunged the nation and the world into a Great Depression. The Glass-Steagall Act was a means of restoring stability.

Finally, in 1999, Bill Clinton and Congress agreed to ditch what remained of Glass-Steagall.

As a result, the American economy once again became a betting parlor. Inevitably, Wall Street suffered another near-death experience from excessive gambling. Its Ponzi schemes began toppling in 2008, just as they had in 1929.

The difference was this time the US government bailed out the biggest banks and financial institutions. The wreckage was contained. Still, millions of Americans lost their jobs, their savings, and their homes (and not a single banking executive went to jail).

Which brings us to the crypto crash.

Before the crypto crash, the value of cryptocurrencies had kept rising by attracting an ever-growing number of investors and some big Wall Street money, along with celebrity endorsements. But, again, all Ponzi schemes topple eventually. And it looks like crypto is now toppling.

The industry is pouring huge money into political campaigns.

Former treasury secretary Lawrence Summers advises crypto investment firm Digital Currency Group Inc and sits on the board of Block Inc, a financial-technology firm that is investing in cryptocurrency-payments systems.