It’s not still the early days of blockchain

rsanheim

I'm increasingly seeing "web 3.0" as basically a two headed beast:

1) a way to part greater fools from their money until the hype has died out

2) a hot topic to drive clicks and discussions for nerds and, increasingly, the tech press, from other more pressing issues that exist in terms of tech and culture and finance

In other words, its a bullshit scam, can we please move on already?

laurent92

When I was a young engineer in 2006, the marketing about Web 2.0 was in every tender for IT projects, so much that my boss created the “Web 4.3 dev community” in my city to point out the ridiculousness of it.

Every versioning of that idea is marketing speech.

zwkrt

Web 2.0 and 3.0 are not directly comparable just because they have similar names, a fallacy of equivocation.

Web2.0 might have had a silly name, but the idea of the web as something that the average user and company could contribute back to and use to communicate with in real time provided explicit value and convenience over existing alternatives (letter writing, door-to-door sales, in-person self-promotion, calling a pizza parlor, renting a physical video, long distance phone calls, physical plane tickets mailed to your house…)

I don’t see that with web3.0.

CRConrad

> Web2.0 might have had a silly name …

> I don’t see that with web3.0.

I do.

heurist

It's a way to authenticate yourself without a centralized authority. So right now it's being used to create exclusive communities, access to which theoretically has some value. In the future, there may be application ecosystems which operate solely against your wallet information, no need for registration. Maybe that has some value too - time will tell.

I don't follow the details of the web3 market closely, so not speaking in support or against here.

rsanheim

We've had "auth without centralized authority" for decades, and 99% of people don't care and won't deal with the hassle involved. see PGP, encrypted email, OpenID, etc etc..

The exclusive communities you mention only have value because of the hype and FOMO and high dollar amounts that people see being made on sales of "exclusive" NFTs or some such. Same as many of the many crypto pumps, same as the dotcom bubble, same as tulips. Same as it ever was.

yata69420

> see PGP, encrypted email, OpenID, etc etc..

Yeah, but this actually works.

Like it or not, people are already using their wallets as their username. And they're trading cryptographic assets. And everyone can see it because it's public.

This isn't theoretical.

I've been to PGP key-signing parties. I can assure you that this is not that.

ique

Most people don't care about X, so clearly anyone trying to build a product to address X is just a scam.

wahnfrieden

those are ideas on a shelf. even stackexchange dropped openid years ago

Shish2k

> It's a way to authenticate yourself without a centralized authority

PGP did that 31 years ago though, faster and more efficient and without all the downsides?

adgjlsfhk1

inefficiency here can actually be useful, it's similar to password stretching. If you know someone had to burn $10 of electricity to make an authentication, it hurts more to get banned.

usrbinbash

> It's a way to authenticate yourself without a centralized authority.

I do that without any involvement of a blorkchain on a daily basis. Everytime I use my ssh key to connect to a server that knows my public key.

Abishek_Muthian

> It's a way to authenticate yourself without a centralized authority.

Can someone provide me with a clear example of this being implemented? AFAIK accessing blockchain from a traditional client(website/app) still requires going through a central node.

Did something change with 'Web3'? Pardon me for not being up-to-date but it's like one day I woke up and Web3 is all over the place it seems like well-coordinated, heavily funded campaign. How else can we explain this seemingly sudden trend of Web3?

galaxyLogic

I would like to create an online application which people could use by paying for its usage in bitcoin.

I assume it would make the application much simpler because there would not need to be any or very little user-account management, no sending bills or charging credit-cards. Just gimme them bitcoins. The user-state could be stored on the client-machine, unless they especially want to pay for us backing it up on the cloud. Still it could be backed up anonymously, identified by the wallet.

No more hacking, if there were no user-accounts or passwords there would be nothing to hack.

tsimionescu

How do you inagine "giving you bitcoins" will work without you doing something equivalent to sending bills or charging credit cards?

Sure, you can publish your wallet address and tell them to send you money. How do you give them access to your content after they have sent their money? How is Bitcoin helping compared to you publishing your IBAN account number and asking for money to be sent directly there?

freemanon

i suggest learning it properly before jumping to conclusions. everything has pros and cons. e.g. cars pollute but would you want to go back to riding horses? judge less, learn more

mikeg8

This is always the defense: “you obviously don’t understand it”. Or, maybe there is a good reason this type of article pops to the top of HN every other day. The skeptics have good reason to doubt the viability of all the hype.

freemanon

is calling out oversimplifcation is also oversimplifying? i'm not arguing that there is no good reason to be sceptic, i'm calling out against forming a strong opinion strongly held on little understanding

dmingod666

Read the article by moxie on NFTs. It is so poorly designed that a jr JavaScript developer with 6 months experience would be ashamed of it. Don't "Go-and-lean" us. We are technology people here not your non-tech crowd that'll get scared and silenced by "go and learn"

freemanon

there is no arguing that the world of crypto is full of scams. just like the internet. we can learn and adopt new technologies while keeping down its externalities by understanding the pros and cons, not by slapping overgeneralised labels of "good" or "bad" on everything to cover for the lack of rounded understanding

rsanheim

I actually would prefer riding horses if it were feasible and safe in my community, thank you very much =).

I've learned enough at this point to know a scam when I see one, and I definitely don't need to go thru my history w/ software and tech bubbles and cryptocurrencies to explain why web 3.0 is full-on bullshit.

rambambram

I like your reasoning here and in other comments. Please consider adding an RSS feed to your blog, I want to subscribe to it in Web 1.1 style.

freemanon

well i guess it's simpler to live with fast and decisive conclusions to new information. personally i try to manage my prejudice and keep giving chances for someone or a new piece of information to change my mind, in case i have the wrong understanding

jakupovic

Oh wise one can you tell us more? We're dying to learn from the smart ones who can tell based on their past what the future holds. Or maybe you don't know, which is true, since none can predict future. Therefore you're talking out of your ... and not contributing to the conversation. Now you can say that I'm not contributing either, but it has the same place as your statement...

ryandamm

I've yet to see a "pro" for blockchain or NFTs that doesn't conform to the characterization you're trying to dispute. Care to offer one? I'm eager to learn.

magicjosh

I also want a writeup covering some examples of Bitcoin or Ethereum use that are relatable.

This recent NYTimes piece takes that approach, though none of the examples are that impressive: https://www.nytimes.com/2021/02/03/style/what-can-you-actual...

(Disclosure I own Bitcoin and Ethereum)

mohanmcgeek

I see more and more of this attitude these days: "Stop spreading disinformation. Educate yourself"

A useful contribution would be to point out how exactly the GP is wrong.

I can imagine the current international banking system get upgraded with a blockchain like technology such that you don't need a central bank of central banks.

But the web3 guys simply want to compare detractors to luddites

freemanon

my argument isn't that the GP's information is wrong per se, but that gross oversimplification through slapping labels like "scam" and "bullshit" against the merits of a technology is blind, just as blind as people who worship the blockchain.

my argument is for us to make our cases in an enlightened and civilised way instead of calling out names

koonsolo

It's funny how HN is negative towards crypto and web3 (see all upvoted articles on the topic, and related comments). Yet can't seem to stop talking about it.

I get it, you don't like it.

So I agree with your last point: let's all please move on.

systemvoltage

I’m pretty much convinced that crypto stuff is a scam. Still, I want to question the mob. We only get better understanding, doesn’t take anything away.

I like hashing things out but whenever there is a huge bandwagon effect, I am increasingly getting more skeptical. Happy to be wrong but we need skeptics that question mob mentality.

There are several recent examples of this: 1) Inflation 2) COVID origins (Lab leak) 3) Zero-COVID policies and lockdowns.

I always question these things - what if we are wrong?

stjohnswarts

Well as long as there is a lot of tech hype about it we will continue attempting to cut through the bullshit buzz words and point out the good and the bad and the worse.

krapp

>let's all please move on.

We don't do that here.

poof131

A few months ago I agreed with her entirely. Tether is an unbacked fraud and NFTs are being front-run [1, 2]. The mid-level marketing Ponzi vibe is crazy. The latency of applications on the blockchain is atrocious. But more recently after learning from and interacting with people building in the space my assessment changed. There is an interesting intersection between tech, communities, and economics. There exists a transparency in the open-source code of smart contracts that will disrupt the current gatekeepers like the internet did.

Certainly, there are problems, but some things will live beyond the crash that is coming and change things in ways no one can be sure of. The internet started in the 1960s and was opened up commercially in 1989.[3] It feels like we are somewhere between 1995 and 2000. The energy feels similar with people trying to shove old paradigms into a new world, vaporware companies, and insane investments. I don’t think we’ve seen the top and it will likely make the crash of 2001 look small by comparison. I may be wrong, but if I’m not, it still is early.

[1] https://bitfinexed.medium.com/tether-is-setting-a-new-standa... [2] https://twitter.com/Foone/status/1457749433844568066 [3] https://en.wikipedia.org/wiki/History_of_the_Internet

saalweachter

I'm sorry, I'm not trying to call you out personally, but this is itching my brain something fierce so I have to blurt it out, and hey, it's the internet. A little derailing never hurt anyone.

It's amazing to me how universal the "I used to be a non-believer" line is in evangelism. From the classic "I used to be an atheist but I've been born again" to all the members of political party A claiming to have been a member of party B before seeing the light to technological evangelism.

It just jumps out at you after awhile.

mw888

That’s a nice little Kafka trap you’ve constructed to disregard the people who change their minds away from what you think. So every time someone changes their mind and uses their previous opinion as informative you are going to non-committally imply it’s “evangelism?”

saalweachter

It's not really a trap -- it's more a rhetorical tactic.

The trick is that when you say "I used to believe X, but now I've realized I was wrong and believe Y", you can get away without giving evidence for why X was wrong and Y is right. You appeal to a commonality between you and your audience (your audience believes X, you used to believe X) and by presenting your change you imply that they are being left behind, that they have missed something you have seen.

It's such an effective rhetorical tactic that speakers will sometimes make up a conversion experience to use in their evangelism, even if they have always been a member of the faith.

There's nothing wrong with changing your mind, with adapting to new evidence. But you shouldn't confuse someone's declaration that they have changed their mind with evidence for the position they have adopted; that's where logic and rhetoric diverge.

(And again, I'm not trying to start something with the GP; I am fascinated by the universal utility of the rhetorical device more than this specific case.)

Sholmesy

S/he's not disregarding the people who change their mind, he's pointing out the emptiness the trope of "I use to be X, so I know what it's like".

Changing one's mind should be encouraged.

hooande

stating that you used to be a non believer isn't necessary. he could have made all those points about blockchain without that piece of information. the GP's point is that the decision to add it is worthy of suspicion

z3c0

Seems like a reworking of the "everybody has an agenda" retort you see so often these days. It's a slippery slope that only leads to dying a curmudgeon, as all chances for new perspectives were rebuked as agendas/evangelism/propagandist/etc.

TomSwirly

If the comment gave any actual reasoning, it wouldn't be open to that criticism, but as it is, it's empty hype which deserves all the criticism it gets.

throwaway98700k

It’s a dangerous attitude because it has a paternal edge to it. Any “enlightenment” naturally leads to seeing others as unenlightened.

nyolfen

it is dangerous to say that you have changed your mind about something?

mahogany

Alternatively, what if they simply learned something new which caused them to change their belief in something? It's better to focus on what caused their mind to be changed (it may or may not be bunk) versus focusing on the fact that their mind changed at all (which can certainly be a good thing).

antifa

> what if they simply learned something new which caused them to change their belief in something?

Then they would have shared that, instead what we got was indistinguishable from "some charismatic people dupped me and/or I'm in on the scamming now."

mattdesl

it goes both ways – "I used to be religious, now I am an atheist"

(I was also against crypto/blockchains when I first learned about them last year)

antifa

It really doesn't go both ways.

It's "I didn't find any evidence for God, so I stopped believing." vs "I believe God is real but I can't prove it".

When somebody is telling me they think God is real, they're trying to sell me something, or they think it's important to tell me.

When I tell people I'm an atheist, I probably didn't want to have to tell anyone, and I genuinely don't care what you believe unless you're using it to hurt others.

mrelectric

As usual, truth is somewhere in the middle.

tomxor

The parent's perspective does not come across as an evangelist's though. Quite the opposite. It's balanced, seeing the hype for hype, seeing the flaws, and yet seeing that there is still some truth and potential buried in there. The world is grey.

TomSwirly

> seeing the flaws,

The article names none.

> yet seeing that there is still some truth and potential buried in there.

The article details none.

> The world is grey.

"Everything is true, even false things!"

floodyberry-

There was no substantial justification given for changing their opinion. IF it was an honest post, it was entirely unconvincing

lumost

You know, it's funny. I've worked in and around analytics for a long time now, and I've had the thought that blockchain enables the following.

1) A common "universal" transaction data source

2) A shared, readable format

So the thought occurred to me that as soon as blockchain apps/currencies became popular, people would want analytics on them. There would thus be a startup opportunity for unprecedented analytics visibility into transactional data from a third party without needing to build bespoke integrations into high security/compliance systems.

If a blockchain backed currency was widely used, a third party could easily estimate the real-time sales flow of every brick and mortar store location. You could have real-time auditing and quarterly tracking of both public and private corporations available from a third party. Asset transfers, smart contracts, and their real world equivalents could be instantly monitored - allowing the early detection of emergent supply chain bottlenecks.

The problem with all of this is that in the 5 years since I had this idea, the only use cases for BTC and other cryptos has been price speculation. The market for such analytics products is effectively zero.

big_youth

Blockchain analytics are a big sector. Companies like Coinbase and Binance have spent billions acquiring blockchain analytics firms.

Additionally, I think there is big money in selling blockchain analytics to governments for the money laundering, darknet markets, and fraud sector.

https://www.coindesk.com/markets/2019/02/19/coinbase-acquire...

https://www.coindesk.com/business/2021/04/30/coinbase-to-acq...

https://www.cnbc.com/2021/09/09/mastercard-to-buy-blockchain...

https://www.coindesk.com/markets/2019/12/03/binance-acquires...

floodyberry-

There is no future in third party analytics because any "blockchain" that is globally adopted and used for more than shitcoin speculation will be zero knowledge

samhw

What do you mean, “will be zero knowledge”? How does that apply to a blockchain in a currency context, when validating a new transaction requires knowledge of both parties’ transaction history?

ptx

Making all their real-time sales data public, and thus available to their competitors, doesn't seem like something most companies would want.

If the blockchain does enable this, wouldn't that just lead either to 1) companies not adopting blockchain, or 2) some solution for hiding the data and defeating third-party analytics?

lumost

Possible, however having this data available makes accounting, and taxation trivial. Money laundering, fraud, theft, and other illegal activities also become extremely difficult to hide.

Which is to say that investors, governments, financial institutions, and small businesses unable to afford external auditing and accounting probably want this capability more than individuals. I'd argue that our current lack of financial transparency may be more of an artifact of banking technology limitations rather than an intrinsically desirable property.

jcbrand

You were right, blockchain analytics was a great startup opportunity and there are already a bunch of companies, like Glassnode, doing blockchain analytics.

You also seem to be missing a lot of interesting stuff happening with cryptos if you think it's exclusively price speculation.

lumost

GlassNode's tagline is "Time crypto market tops and bottoms.", I don't doubt that simply analyzing the exchanges is a valid market. But not one that I think is particularly large, particularly not when the exchanges can add their own analytics at any point.

crehn

> There exists a transparency in the open-source code of smart contracts that will disrupt the current gatekeepers like the internet did.

Could you elaborate which gatekeepers it will disrupt?

unityByFreedom

IMO social media needs competition but I don't think it will be disrupted by blockchain or decentralization. It will be disrupted by a continued pursuit of competition by doing things like supporting net neutrality. That keeps the playing field level and prevents current big players from becoming further entrenched. Big tech's monopolies are encouraged by lower-level-monopolies owned by Comcast and the other internet media conglomerates. To solve the problems higher in the tree we should get at the roots.

tim333

It is somewhat disruptive to banks. You can invest stable coins and get interest for example which is higher than bank interest. And the operator doesn't need to spend a fortune applying for banking licenses for each country they operate in.

doomrobo

Absolutely not. The reason bank interest is lower is because the FDIC ensures that you get your money if the bank stops existing. If the company backing your stablecoin stops existing, what are you left with? Nothing, of course

This not disruptive. This is just normal investing with all the risks attached

ahtihn

Try looking into why these investments have higher returns than a bank account. The risk profile isn't the same at all.

If you want returns in traditional finance, you don't stick money in a bank account. You buy bonds and/or stocks.

cuteboy19

You say this on a thread that confirms Tether to be an unmitigated fraud. How and why are we supposed to trust in USDC, USDP and all the other permutations of USD to not be frauds themselves. It is easy to give a 10% return when all your really doing is offering unbacked IOUs

olalonde

> A few months ago I agreed with her entirely. Tether is an unbacked fraud and NFTs are being front-run [1, 2]. The mid-level marketing Ponzi vibe is crazy. The latency of applications on the blockchain is atrocious. But more recently after learning from and interacting with people building in the space my assessment changed.

I feel like a lot of the cryptocurrency critics commit the "fallacy fallacy". That is, they have the following reasoning: people believe crypto is good because of X, X is false, therefore crypto is not good.

Yes, there are a lot of people who are into crypto because they think it's a way to get rich quick. Yes, there are a lot of guru technical analysts who sell bullshit dreams on their Youtube channels. Yes, there are a lot of criminals who use cryptocurrency. Yes, crypto attracts a lot of charlatans and snake oil men. Yes, there are a lot unbacked stablecoins and shitcoins.

Given the above, it's easy to dismiss all cryptocurrencies as a scam. But when you dig a bit deeper, you'll find that there is true technical and financial innovation. For me, Bitcoin's potential to be a programmable money without government or central authority is a very powerful idea. The idea that you can be your own bank and do p2p electronic money transfers without an intermediary. That has never been possible before.

I could go on but my point is that even if there are many wrong reasons people like X, it doesn't necessarily mean that X is wrong/bad.

nly

Everyone doing P2P transfer and bypassing traditional banking institutions is a powerful idea... but ultimately everyone needs to agree on a single medium of exchange, otherwise efficient market pricing is too hard.

And it's debatable whether fiat will ever whither and die. The Government will ultimately have to endorse a currency for tax purposes, and they'll always seek to control the inflationary environment so they can maintain a workable budget and keep public services afloat.

Just a century ago or so, banking was only for large corporations. Commoners and small businesses all used cash and exchanging bits of valuable metal was the norm. I mean, believe it or not, we had good reasons to abandon that simpler system in the first place. Things are better now. Markets are more efficient.

fragmede

> but ultimately everyone needs to agree on a single medium of exchange, otherwise efficient market pricing is too hard.

This is one place that there is something interesting in the crypto space, but because it's so "inside baseball"/esoteric, it doesn't usually get any mention on skeptic's forums. Given asset A and asset B, given individual A with asset A, B with asset B, and C who wants to trade their asset A for B, how do you get all three to come together and make it all work. The fact that there must be exchanges is obvious, what's less obvious is how they actually work, how individuals A and B incentivized to participate, and what sort of payment they get out of it. Well, that's one of the not-entirely-trivial usages of smart contracts I've seen, where A and B get a payout and C gets what they want, but with more than 3 individuals involved. It's not actually important to anyone outside of the crypto space but it's interesting to take a look at the implementation details for the curious.

samhw

Yes, I’m a strong believer in cryptocurrency, but I don’t believe any current cryptocurrency will be the one that changes the world. They deserve praise - some of them - for laying groundwork, but I tend to believe that the world-changing crypto will have to behave more like Moxie Marlinspike described in his recent essay: i.e. truly building on cryptography as the source of trust, not distributed consensus among servers.

The transaction processing mechanism will also have to radically change, and be detached from the mechanism for generating money (even if you believe the two should be proportional, to strictly couple them is an impracticable engineering failure).

As for Bitcoin, aside from the flaws in Satoshi’s scheme itself, the current Bitcoin system has suffered from focussing on its unexpected popularity as a store of value, which popularity has meant it’s incredibly volatile and thus useless as a medium of exchange or unit of account. Of course the slow processing as a result of the mining mechanism is also a major hurdle.

I hope something better will come about soon. I know that it won’t come from the world of people who suddenly idolise Bitcoin because of the cult around it. It’ll come from the people who were capable of reading the original paper and seeing its potential even before it was in the news - that’s a tiny subset of crypto enthusiasts, but I hope they stay motivated.

(Final thing: it’s ‘wither’, not ‘whither’. ‘Whither’ means ‘from where’.)

DennisP

> otherwise efficient market pricing is too hard

Oh I don't know, everybody's carrying around an internet-connected computer in their pocket, it can't be that hard to show current prices in a variety of currencies. But if it is too hard, then stablecoins backed by on-chain assets are another option.

Fwiw, Ohio accepts tax payments in Bitcoin: https://www.forbes.com/sites/kellyphillipserb/2018/11/26/ohi...

bufferoverflow

> everyone needs to agree on a single medium of exchange

No, everyone does not. You can easily exchange the coins you don't like for the coins you do. It's that simple.

slg

>But when you dig a bit deeper, you'll find that there is true technical and financial innovation.

I will give you the technical innovation, but I really have not found anything financially innovative about cryptocurrency. What does crypto do that traditional currencies or payments systems don't? The only thing I see is that it largely replaces the old financial elite with a new financial elite and maybe under the right circumstances reduces fees for transferring money. That seems to be it unless you count circumventing financial regulation as a financial innovation.

meowkit

Seems unnecessary to nitpick innovation between the disciplines.

The technology enables many new tools to be developed and many old tools to be augmented. Saule Omarova (Biden’s comptroller pick who resigned) had some interesting ideas in her papers/essays. DLT-based deposit debtor accounts being offered by the government was one that I thought would be pretty great.

gitfan86

No one should be suggesting that 100% of crypto is a scam and that there will never be anything useful in the crypto space. Vitalik seems the be operating with best of intentions and IMO the threat of decentralized money has already effected the central banks in their thoughts around inflation.

My main problem is similar to the original article here. In 2014 Bitcoin was "The future of micropayments" 6 years later and now the narrative is that "Layer 2 networks are the future" It would be great if the crypto people could stop talking about how great the future will be and just deliver what they are promising

WA

Nah, it’s like this: people believe crypto is good because of X, Y, Z, A, B and C. All of them are false, except for C in some odd circumstances. Therefore, the current state of crypto is not good.

dmitriid

> But when you dig a bit deeper, you'll find that there is true technical and financial innovation.

Ah yes. The good old "just google it". There's literally not a single "dig deeper" resource on the internet that explains the need for blockchains/cryptocurrencies etc.

But sure, there are a lot of "innovations" with recursive circular "innovations" (like currency speculation, HFT and flash loans, all of "innovatively made available" by regurgutating the same fatasy tokens and pretending they are worth something)

olalonde

> Ah yes. The good old "just google it". There's literally not a single "dig deeper" resource on the internet that explains the need for blockchains/cryptocurrencies etc.

I just named a rather massive one in my comment.

benreesman

I have wondered for awhile why the crypto mega-whales in my vicinity are trading USDT at par or better over the last year or two.

My conspiracy theory is that when insiders trade a distressed asset at par or better it’s often a bailout expectation that’s really being traded.

Who has unimaginable access to financing, a “stablecoin” going so/so, and a primary line of business critically dependent on Tether, like, I don’t know, a massive exchange with the highest volume pairs all sharing USDT as quote?

oneoff786

It’s not that hard. When Bitcoin goes down, people like tether because it’s “safe” at $1. So bitfinex makes more tethers and trades them for bitcoins. When Bitcoin goes up, bitfinex sells the Bitcoin and gets dollars.

It’s fractional reserve banking swapped around, with no reserve requirements. The market is the bank.

And because bitfinex is not obligated to redeems tokens for $1 they have no risk. It’s in their interest to keep the market price at $1 because the longer it runs the more money they make but if there’s a run on the currency they can just shrug and go home with their bag of dollars.

ricardobeat

This is like giving central-bank levels of power to private entities. Which obviously follow from de-centralization. It’s insane.

The only way this could be a reliable replacement for our existing financial systems, would be with strong oversight from.. some kind of central entity that acts on behalf of society’s collective best interests.. staffed by people chosen through popular voting..

tim333

The price of things like USDT are effectively set by Tether rather than the free market. If Tether have billions of US$ and offer in the market to buy back USDT at 1:1 then that's what they price will be near enough.

bb88

What you've described is metastasized moral risk. We could argue that maybe some risk should be rewarded. But not all risk, such as spending billions in beanie babies as a corporate strategy.

benreesman

Eh, there are some important distinctions here. Pricing risk is an activity with fairly clear value, and as a result you can make a ton of money by being good at it. Assuming risk is something that every individual and organization does to one degree or another, and to the extent that they do so in a rational way it’s because they are pricing risk well or delegating that.

Your use of the word moral makes me think that you might be talking about shifting risk off onto others. Keeping the upside in some more favorable ratio to handing others the downside is (IMHO) immoral but also one of two main ways that people get rich, the other being inheritance.

delaaxe

I mean Binance has BUSD no?

TomSwirly

And yet you still don't name any actual useful applications!

The Ethereum world computer has 300,000 nodes, and yet has 1/5000 the computation power of a single Raspberry Pi 4.

Except for actual cryptocurrencies, all the "web3" applications could use boring old 1980s vintage cryptography, be just as distributed, and run ten thousand times faster and cheaper.

----

So far the only way anyone has ever made any money from cryptocurrency is to sell it to someone for more fiat currency. In fact, in real terms, it has net lost money because of the huge amounts of electricity expended.

So once people such as yourself purchase cryptocurrency, they know in their hearts that the only way they will make more is if further people buy into their Ponzi scheme.

Therefore, your comment above.

dmitriid

> There exists a transparency in the open-source code of smart contracts that will disrupt the current gatekeepers like the internet did

Ah yes. How can we forget the community-audited and vetted smart contracts that ended up draining its users' wallets of all their money. Transparency!

sabhiram

Well, as opposed to hearing "oops our black box implementation of your information got hacked", I honestly don't mind the trend of "read the contract, it is code". Sure it can be misleading, sure it can be intended to trick someone. However, code is law, and even backdoors are "code". Instead we should fix the backdoors so that code can be reasonable "law".

dmitriid

> Instead we should fix the backdoors so that code can be reasonable "law".

There never will be. For the absolute vast majority of people, programmers included, these "contracts" will be a yet another blackbox.

Moreover, it already is a blackbox even to the people who develop them, because they can't find errors in their own software and APIs.

somebodythere

Every time a nascent technology bubble crashes (dot com, AI winter, crypto...) speculation gets reset, scams and projects with no future get wiped out, and the space gets healthier.

betwixthewires

> All that to say, a lot has changed in the technology world in the past six to twelve years

It sure has. But not really that fundamentally, since 2009.

A lot has changed in the blockchain space too. Just because you don't know about it doesn't mean it isn't true. A lot of those changes are on par with some of the tech advancements mentioned before my quote in the article. In 2009, you had bitcoin, so basically a distributed consensus workaround that enables artificial scarcity of fungible digital items. Today, you have sharded blockchains, triple entry bookkeeping, proof of stake, blockchains that handle incentivized file storage, alternate name lookup systems, purchasing compute power on an automated order book, liquidity pools (a major, major fintech advancement if you're not familiar with then), arbitrary code execution with a canonical record of it.

It is absolutely still early days.

Because these are decentralized consensus networks, there's inertia. Bitcoin is never going to be cutting edge. Because there's a lot of money to be made, there will be scams. Most of the "cutting edge" isn't cutting edge at all. But there are some real developments happening, allowing novel use cases, enabling very interesting things to be done.

I'm not a fan of the whole web3 concept. I think 99% of the selling points that the charlatans hype every market cycle are nonsense. But a little digging beyond an animated JS bloat landing page (a red flag all it's own) and you can quickly figure out what projects potentially have something and what's bullshit. Or you can do what I do and assume a project is a scam until proven otherwise.

MaxfordAndSons

> blockchains that handle incentivized file storage, alternate name lookup systems

It would be a shame if IPFS and Filecoin end up in the dustbin of history if the web3 music stops. They're the only reasonable non-financial applications of blockchain tech that I've been able to wrap my head around to date.

tim333

And IPFS isn't even really a blockchain tech. It's more a variation on bittorrent which predates bitcoin by several years.

laserlight

8 years, to be exact.

betwixthewires

Yep, they're great. I prefer IPFS without the incentive layer of filecoin, but it is interesting to be able to incentivize storage in protocol, and there's obvious use cases. Plenty of people pay google drive or Dropbox for extra storage. Democratizing access to the demand and supply side of that market is pretty cool.

There was a project called Golem aiming to do the same thing with compute, it was pretty cool last time I read about it. Not sure how far along it is, and I'm sure there are other projects aiming to do the same thing.

chx

> Today, you have

snip

weird things no one gives one hoot about outside of the crypto shill word. All of this is just buttering the cat.

https://twitter.com/GossiTheDog/status/1476873668605186050

betwixthewires

Well then what's the point of this discussion? The thread is "how has it advanced? How long can you call it early days?" If you just stop reading rebuttals as soon as they're mentioned you're better off talking to a wall, and you'd waste less people's time that way too.

Daishiman

Because technical minutiae are completely irrelevant if they don't eventually convert into useful features for products with at least some level of mass-market appeal.

I have yet to see a single enticing idea for blockchain/web3/whatever for a consumer or business not related to finance. If that requires an ever-increasing number of technical challenges to be solved for that to happen, then we're just looking at vaporware.

tootie

Changes in the implementations are not the question. It's application that she's skeptical of. Who has found a reason to use Blockchain for anything other than cryptocurrency?

I actually witnessed one attempt. An actual Fortune 100 built a Blockchain for their public communications. Mostly just an excuse to show off their street cred. It landed with an absolute thud. Nobody cared.

sweetbitter

One idea that I am fond of is Nym, an implementation of the high-latency mix network Loopix[0], but with incentives for nodes to act as mixnodes and message providers, using a model in which users pay nodes for their bandwidth. The goal being to provide strong anonymity in the face of a global passive adversary.

[0] - https://arxiv.org/abs/1703.00536

samhw

I’m not a crypto fan, but I’m not sure what that example demonstrates. A company made an overengineered gimmick just to show off their street cred; nothing came of it, just as they expected, and it was a waste of the engineering. I’m lost as to how this reflects poorly on the engineering technique.

tootie

My point is that big companies are pouring resources into finding something to do with Blockchain and just can't.

deanCommie

Do we have proof of stake or do we have a lot of bitcoin folks avoiding criticism about the wasteful nature of most chains by claiming that proof of stake will fix all this.

How many coins are actually using proof of stake?

Why haven't the biggest including Ethereum done so?

betwixthewires

The same reason Bitcoin doesn't implement every tom dick and Harry's supposed solution to every technical problem. The big boys have to get it right the first time. Again, inertia.

Ethereum does have proof of stake, a protocol called Casper FFG. It is currently live on the Ethereum beacon chain, waiting for consensus to move the entire network to it.

There are lots of smaller projects trying different protocols they call proof of stake too, as well as different proof of whatever they came up with for whatever reason. Most of them are veiled centralization, some of them are interesting for one reason or another. I'm not here to shill networks or coins so I won't be tossing names around.

deanCommie

> waiting for consensus to move the entire network to it.

May I clarify what that means? Does that mean a vote of the existing participants?

If so, might it never happen?

DennisP

Right now Ethereum has 9 million ETH deposited on its proof-of-stake network, worth about $30 billion.

That's running in parallel to the main network, which is still mining. Code to merge the two and eliminate mining is currently running on a public test network. Previous upgrades have all taken less than a year to go live after the launch of their public test networks.

baby

I’d say most of the coins today are proof of stake

eco

Most of the "proof of stake" coins are some form of delegated proof of stake, usually with an opaque and shady set of highly compensated validators with hidden connections to the project. Effectively proof of authority masquerading as proof of stake. This lets them have big TPS bragging rights while maintaining the appearance that they are running a decentralized blockchain rather than a centralized database with extra steps.

Real, decentralized proof of stake is a hard problem that has only just started to become reality.

RustyConsul

Comments like these make me wish hackernews had a follow button.

You leave the article with a certain conception and sometimes it's utterly shattered in the comments; This is one of those times.

ryandamm

The central problem in this entire debate is two groups talking past each other. The skeptics say "what is it for?" expecting a detailed answer, and the response from crypto enthusiasts is vague and high level; most of what I hear is heavy on words like "revolutionize" and "decentralize" but very, very short on specifics. Or I get argument by analogy to other technologies.

If I heard a single use case where blockchain technology actually created real value in the world, and was better than other alternatives, I'd listen. But it has to create real value, based on the real world and not some fantastical notion of what money is or governments are for.

I think we skeptics want a grounded narrative, and we're stuck hearing a thesis statement and nothing to back it up.

magicjosh

Here's a recent article from the NYTimes on buying things with Bitcoin. None of the examples seem impressive, a doctor accepting payments for covid tests, sex worker getting paid: https://www.nytimes.com/2021/02/03/style/what-can-you-actual...

democracy

I also find funny how all the fighters for the bright future, peace and rainbows are planning to become filthy rich in the process of making the world a better place. People like Vitalik and Charlie Lee (Litecoin) happily cashed out their coins into dirty filthy USD in 2018 and became millionaires. You remove the chance to become crazy rich and who really gonna stay there?

lawn

A single use-case?

How about uncensorable donations? For example Wikileaks got blocked by banks and payment processors when they wrote about the war crimes the US committed.

The US could block the banks, but they could never block crypto donations.

rednerrus

Crypto was good for blackmarket transactions.

ryandamm

Still probably is!

pclmulqdq

Not now that companies like chainalysis exist: the transactions are on a public ledger. Monero was designed for private payments, and its value hasn't exploded like Bitcoin or Eth...

mw888

People this uninformed are somehow the vocal majority of blockchain talk on HackerNews. What a seriously embarrassing misconception which demonstrates ignorance on a fundamental level.

koonsolo

Of course there are awesome use-cases, but the real problem of the skeptics is that they can't let go of their fiat.

Take Nano for example: sub-second, 0-fee transactions, of any amount, to any (unbanked) person in the world. Of course, there is no way that any other (fiat) system can achieve this (due to operation costs, regulation, etc)

But the response of skeptics will always be "but I have to convert my fiat money". And at that point, it's not free and instant anymore.

But just because the new system loses its benefits because of backwards compatibility with the old system, doesn't mean that it is inferior. Maybe for some things, you don't need to pass through the old system anymore. One example is mining pool payouts, which can do payments through Nano to get the 0 fee transactions. (see https://2miners.com/blog/how-to-get-payouts-for-ethereum-min...).

You can argue that this mining is all a scam etc, but in the end real value is transferred using the most optimal network. More optimal than any central system that you can think of (remember 0-fee, instant trancations).

wackro

> ... but the real problem of the skeptics is that they can't let go of their fiat.

>But the response of skeptics will always be "but I have to convert my fiat money".

Here's a thought experiment for you. Your mother/father/neighbour's entire wealth is converted, at no cost to them, into BTC/ETH/whatever. What is their reaction?

Is it, 'thank god we didn't have to pay those conversion fees!'

I think not.

koonsolo

Here's a thought experiment for you. How do you transfer money from US to: Venezuela, Mali, Lybia, Angolia, Tajikistan, Uruguay?

I can give you a really simple answer when using crypto: you just transfer it.

Can't wait to hear your answer for each of those countries, and the fees and delays associated with it.

edit: some people go work in a western country and send money home to their family.

Sparyjerry

The crux of what makes it popular is decentralization which is a fantastic feature and I'd argue the single feature that it has that regular currencies can't ever have. However, everyone doesn't have a wallet and about 60% of all bitcoin is in the hands of only about 10,000 wallets. It's one of those things, if everyone had it then it would work great but because no one has it, it doesn't work at all. In order to get it you need someone you trust to trade you it, which means a centralized exchange, high fees, and slow transactions. However, if you only ever live in a bitcoin or other decentralized coin economy, meaning you never have to trade out of it into another currency, then it can work for you. Say Tesla accepts bitcoin, and everyonjhe pays in bitcoin, it still has to pay it's suppliers who don't accept bitcoin, this means it has to make a conversion to regular currency, adding an additional step, making things slower and less liquid. It's one of those things that just won't work, until it does.

twiceaday

I don't buy this framing for a second. Crypto is popular, I mean actually popular amongst most people on the ground, only because the price keeps going up; with the implicit promise that it will keep going up. Everything else is creative story telling. On-paper benefits are trotted out only to post-hoc explain the growth (which is mostly there from pumping and people seeing past growth) and to pump the coin further. "Decentralized" is only as important as it keeps the "this is still crypto right?" identity in lay-peoples minds that is tied to magic money out of nowhere. Otherwise it can be weakened arbitrarily.

mirekrusin

Donations for dev's OSS didn't work.

okwubodu

ryandamm

Centralize it and implement something like M-Pesa, or build it on top of the existing mobile networks. The solution is selling standardized contracts to small hold farmers that pay out automatically; the problem has nothing to do with decentralization or trustless transactions.

The blockchain adds nothing here, and creates a layer of complexity that makes it more brittle.

okwubodu

> The solution is selling standardized contracts to small hold farmers that pay out automatically

And how easy do you think that is in Kenya?

You and I being able to take stable banking and government for granted says more about our own position in the world than it does about the efficacy of the technology itself.

hubraumhugo

I'm still very opposed to the idea of taking a technology and then searching a problem for it. Why? Back in 2017 during the first hype cycle, blockchain companies raised hundreds of millions with ICOs. I became very interested in the technology too, and some friends still work in this space. 4 years later in the web3 era, there is not a single product aside from trading/finance that got traction. Use cases like storing the history of a car on-chain, transparent supply chains, public voting... this all sounds interesting but never made it to product-market fit.

I always assume that I'm wrong, so I'll keep looking for successful applications and I'm sure you can prove me wrong :)

lkrubner

I've been documenting this with specific companies. A recent one that I worked with was Omnichains:

https://www.omnichains.com

"Omnichain CEO Pratik Soni speaks to Inbound Logistics about the growing number of blockchain use cases in the supply chain, including in reverse logistics, product authentication and sustainability."

Apparently this company started with the idea that they would use the blockchain to make supply chains more transparent. And they raised money from investors with that goal in mind. But they have since retreated from that goal.

I worked with a retailer that worked with Omnichains. None of Omnichains tools had anything to do with the blockchain. Certainly, we were never given access to a blockchain, nor was it mentioned after we had signed the contract. Instead, we were granted limited access to an API that I believe was run with Ruby on Rails and MySQL. So at a certain point this company retreated to traditional technologies, rather than trying to use the blockchain.

This is one example. At some point I hope to write up some of the other examples that I've seen.

I do not believe anyone will ever find a legal use for blockchains that cannot be more easily served with traditional technologies.

cornel_io

> I do not believe anyone will ever find a legal use for blockchains that cannot be more easily served with traditional technologies.

One does not blockchain to build a product in the cleanest, most efficient manner.

One blockchains to have access to investors/speculators that control the gigantic pile of on-chain wealth that has accumulated over the past ten years, who would never sink $100k+ into a poorly drawn picture of an ape with sunglasses if it was running on Rails+MySQL.

This may sound like I'm being dismissive, so let me be clear, I am not - this is an extremely valid reason to chase this technology, and the existence of these (maybe ridiculous and shady, maybe not) massive stacks of digital cash is going to drive a lot of investment in the space, so if there is anything that can "break through" and prove real value beyond just targeting this wealth, someone is going to find it, likely as a side-effect of targeting these whales.

Web 1.0 couldn't have happened without the late 90s tech bubble, and as ridiculous as the Pets.com era hype was, when the dust settled there was much broader connectivity and a real market for the Internet companies that did live up to the hype over the next two decades.

mountainb

One big issue is that the largest supply chain participants generally do not want transparency because they make their money on opacity. Transparency attracts more entrants, applicants, and competitors. It is business intelligence that provides important things like pricing advantages. When competitors can see your supply chain, they can do all kinds of stuff to make your life harder and gain an edge.

Almost everyone at every stage in the supply chain have an interest in opacity rather than transparency. The people who may want transparency want transparency for themselves but not for others: they want the equivalent of a one-way mirror to spy through. Naturally, people tend to react with extreme negativity to the installation of such one-way mirrors. Actual transparency is desired by almost no one. This is even true at the consumer level: the consumer may want to know the supply chain information for various purposes, regulators certainly want to know it, business partners certainly want supply chain documentation, but a consumer would balk at the notion that they expose all of their credit card transactions to the entire world at all times. It's always transparency for thee and not for me.

yashg

Most of the companies that tout blockchain seem to be doing so to attract free marketing and VC funding. Once they have that the real products seem to use the same old reliable tech that runs the entire internet.

tim333

There's selling NFTs of ape cartoons, or selling crypto coins or other imaginary assets.

Rails and MySQL are too transitory for that - you'd buy a record in the database only to find the company hosting the database had gone broke or been bought by Yahoo who closed them.

You buy a bitcoin and you can be fairly confident in a decade or two you'll still have it.

acdha

> You buy a bitcoin and you can be fairly confident in a decade or two you'll still have it.

You’ll have a copy of some hashes. That doesn’t mean anyone will want to buy them at the price you want or even that there will be an operating network around them.

This is especially important to learn when it comes to NFTs: blockchains are too inefficient to store the media so you’re still dependent on paying for outside hosting (yes, even with IPFS). Because you’re buying a link but not the rights, you would also need to make sure you have the right to even make your own mirror, too.

grey-area

What would make you confident about that? Buying an NFT requires trusting the chain (typically ethereum) and the marketplace.

Now you have two problems.

barneygale

Most NFTs aren't stored on the blockchain.

dmitriid

> You buy a bitcoin and you can be fairly confident in a decade or two you'll still have it.

And it will be worthless. Most assets that NFTs point to are already gone. Because that useless hash you have in your NFT? It points to a centralised storager somewhere.

throwaway6734

>Rails and MySQL are too transitory for that - you'd buy a record in the database only to find the company hosting the database had gone broke or been bought by Yahoo who closed them.

Wouldn't working with more robust companies (like banks) solve this?

edem

You're missing the point. The goal when you use blockchain is not to more easily serve. It is all the things that don't matter to you until it is too late, like censorship resistance.

tyre

Censorship compared to what? What can’t you post on the internet? Specifically that the government would stop you from, not private companies like Twitter booting people.

300bps

There is no censorship resistance with blockchain.

You’re still beholden to the whims of centralized developers and miners.

You’re still beholden to a court order. If the government wants to confiscate your crypto assets they can simply put you in jail until you provide the location of your private key.

If the government can penetrate offshore bank accounts they’ll have no trouble with your crypto wallet.

I’m happily mining ETH with gminer on flexpool.io and selling the coins as fast as I get them just like I did with BTC a decade ago. Because I know this whole thing is a temporary pyramid scheme.

Zerverus

Because when there is an immutable record of all transactions you ever did in perpetuity, you’ll be so much better off in a fascist run country.

The freedom to fuck your life over, forever, in record the moment you make that one transaction that connects your identity is sure worth the fact that it’s uncensorable.

Lol.

The_rationalist

Blockchain has no point versus immutable databases https://news.ycombinator.com/item?id=23290769 or at least database with immutable history of changes.

trauco

One point the linked article makes is that even this claim has been proven wrong.

tomputer

> Use cases like storing the history of a car on-chain, transparent supply chains, public voting... this all sounds interesting but never made it to product-market fit.

Anything that does not exist natively on the blockchain doesn't need a blockchain at all.

If a token on the blockchain would represent you as the owner of a car and one day someone steals your private key which represents your car ownership, that person is now the owner of your car. Still, the car keys are located in your house, the license plate is registered on your name and address, the insurance is on your name.

I guess I don't need to explain further how ridiculous that idea is that a token would officially represent you as the car owner.

chucke

Not to say your completely wrong, just that the purpose of car tokens on the blockchain is to replace perhaps your insurance, but not the keys.

tomputer

I don't see why something like insurance needs a token on a decentralized blockchain. The Bitcoin blockchain needs a token because the token itself represents the value (BTC) inside the network. The token is also needed because it adds an incentive for nodes (miners) to support the network.

Note: this is my current view of it. If someday it turns out it is useful, I am happy to admit that I was wrong.

gambiting

But....why. What problem does it solve. How is it better than existing insurance policies that are perfectly fine being bound to my name and address

Grustaf

Unless the insurance policy is somehow decentralised, it doesn't serve any purpose to decentralise the knowledge that you are insured.

edem

You're totally off. All those things you said _can_ go on the blockchain including the private key that they could use to start the car. Of course they can sell it for parts...if the parts didn't have private key protection too...

cuteboy19

Someone has to do the data entry into the blockchain. You end up having to trust this person, which completely negates the purpose of the blockchain: trustlessness.

For supply chain issues the Oracle problem is very apparent. How does your smart contract know if the shipment has actually reached its destination?

tim333

So do I need to deliver my car to Russia when they hack my computer?

axg11

Couldn’t you say the same thing about the deed for a house?

throwawaylinux

The government enforces property rights though, so it's not a matter of distributed consensus, it's a matter of who the government views as the rightful owner. In a property dispute, a court might look at a number of factors: occupation and use, maintenance and upkeep of the property, paying bills associated with the property, registration of a deed with a title office, etc.

A digital signature on a blockchain somewhere means nothing. How do you connect it with the real property? All of the other above things go some way to demonstrating a real connection to the property. A block chain does not. It's the same problem all blockchain solutions have: verifying the data at the point of entry to the block chain. If that is distributed and can not be trusted and verified remotely, then the existence of it in a block chain does not help.

I'll create PropertyBlock™ blockchain tomorrow and sign a block with your property address it over to myself. Worthless.

nly

Deeds aren't a thing anymore in many countries.

In the UK ownership is determined by a centralised land registry, and it must be registered if ownership is to change hands.

duskwuff

Physically possessing the deed to a house doesn't make you its owner either.

conradev

This problem exists with cash. We teach people to not keep too much cash on them, but to keep it in a bank where it is safer.

You could get a credit card, and then it’s not even your money that you are spending! or your money that you lost to fraud.

I can see both of these existing in the crypto world in some form, the same way they exist in the fiat world

as for the banks and institutions and companies losing all of their money? that’s a new blockchain problem for sure

lawtalkinghuman

> as for the banks and institutions and companies losing all of their money? that’s a new blockchain problem for sure

No, that used to be a real-world problem for banks until laws were passed that more tightly regulated financial institutions...

e.g. in the US, https://en.wikipedia.org/wiki/Wildcat_banking

andreskytt

That said, blockchain-like technologies (ksi, more specifically) can be used to assure the integrity of databases storing the relationship between you and your car.

hectormalot

Yes, but is it a problem worth solving beyond what we have today? What’s the last time we saw an database integrity failure at the DMV/… leading to cars being owned by people that shouldn’t?

staticassertion

Databases have been doing that for a long time. Blockchains only add additional guarantees that matter when you have hostile participants, which only matters if you're decentralizing your system, which you probably don't want to do for a lot of things (like tracking ownership of a car).

lottin

But is this blockchain-like technology better than the alternatives? What advantages does it have over a simple checksum, for example?

democracy

A good example of an imaginary problem!

quickthrowman

I have never had the state DMV lose record of my ownership of a vehicle. I don’t know anyone that has. I can’t find any record of it happening.

It doesn’t sound like an actual problem to me.

CRConrad

Can't a simple checksum or hash do the same (and without burning as much electricity as all of Argentina)?

lawtalkinghuman

mysqldump | sha256sum

conradev

This problem exists with cash. We teach people to not keep too much cash on them, but to keep it in a bank where it is safer.

You could get a credit card, too, and then it’s not even your money that you are spending! or your money that you lost to fraud.

I can see both of these existing in the crypto world in some form, the same way they exist in the fiat world

as for the banks and institutions and companies losing all of their money? that’s a new blockchain problem for sure

Galanwe

> one day someone steals your private key which represents your car ownership, that person is now the owner of your car.

Why take such a naive blockchain as example? You could very well have a proof of authority blockchain so that 3 notary have to sign a car transaction.

You could also very well have revocation lists published on the blockchain by a further authority if keys are stolen.

There are hundreds of ways to make this work.

At the very least, that would allow me to know that I'm not buying a stolen car.

tomputer

I don't think it's a naive example. All these kind of proposed blockchain solutions raise the same questions for me:

Why do you need a decentralized blockchain with tokens to solve that problem? If not for the tokens, what incentive have people to keep running and protect the blockchain against attacks? The oracle problem: how do you prevent someone from pushing false or duplicate data to the blockchain?

gambiting

And literally none of it, not a single step that you mentioned requires blockchain.

lolinder

> You could very well have a proof of authority ...

> ... by a further authority if keys ...

As soon as your blockchain solution requires proof of authority, your trustless solution starts requiring trust in some form of central governance. At that point, what utility does your blockchain solution provide that the DMV database does not?

robjan

Who appoints the notaries?

rileyphone

Blockchain is proving a more than capable solution in the ransomware payments space, enabling a whole new class of malware.

staticassertion

The thing is it's not really particularly good at that. No moreso at least because of any attributes of the blockchain. It's really because of external reasons:

1. Lack of tooling and cooperation for investigating fraud

2. Lack of regulation

3. Programmatic interfaces

4. There are markets like the NFT space that are amazing for laundering

But no part of why it's good for crime has to do with blockchain.

notahacker

"Censorship resistance" was the original use case for blockchain, and demanding money with menaces remotely is the one area where it's unquestionably superior to being discreet about where your money is stored

CRConrad

>> Blockchain is proving a more than capable solution in the ransomware payments space

> The thing is it's not really particularly good at that.

Sure, but apparently it sucks less at that than at anything else. Which would be why that's the only use case in which it's actually used as a "currency"; the law of comparative advantage and all that.

> But no part of why it's good for crime has to do with blockchain.

Well, the anonymity, one would have thought?

vanviegen

Reason 2) does seem to be due to an attribute of the Blockchain, as there is no central organization that the government can force to establish the real-world identity of all participants. (Although this is now happening at the point of conversion to/from fiat currency.)

democracy

That's true! At least there is one great use-case )))

Andrew_nenakhov

It also enables people to finance themselves despite tyrannical restrictions imposed by bad governments. Using bitcoin I can send money to someone in Chi no a who's social rating was degraded by the CCP and who is forbidden from using banks.

This alone trumps any arguments against bitcoin. Crime will exist forever and criminals will find ways to finance themselves anyway, so the use of cryptocurrencies for their operations is not really a factor.

3825

> Using bitcoin I can send money to someone in Chi no a who's social rating was degraded by the CCP and who is forbidden from using banks

How will they convert it into something they can use to pay rent and buy groceries?

> Crime will exist forever and criminals will find ways to finance themselves anyway, so the use of cryptocurrencies for their operations is not really a factor.

Does this make it easier for the wealthy to evade taxes? I find just signing transactions using something like gpg a much easier to reason about.

My biggest concern about cryptocurrency is fees. There is no reason why fees should be based on payload as far as I understand. Whether I’m sending one satoshi (or any other unit of money) or a trillion, the cost should be the same and ideally as close to zero as possible if not zero. This was the original reason I was drawn to bitcoin but it was obvious it would never be the case.

acdha

> Using bitcoin I can send money to someone in Chi no a who's social rating was degraded by the CCP and who is forbidden from using banks.

Okay, let’s think about this even a little bit: receiving that Bitcoin requires them to have software and access websites which the Chinese government has restricted. Assuming they successfully get a wallet app which isn’t compromised, they then need to connect to a well-known, trivially blocked high-volume network service without the Great Firewall triggering. Having done that, they then need to pay a substantial processing fee for any transaction. Since their landlord, grocer, etc. need to be paid in real money this person will also need to find someone to convert it, again requiring a substantial payment because accepting something banned from a pariah is high-risk.

All of this is not only expensive but incredibly risky since you’re leaving a lot of electronic records of illegal activity and you’re forced to trust various third-parties who can be compromised without your ability to easily tell. Bitcoin is perfect for state authorities, too, since it leaves a signed record of intent to break the law for each transaction — if they bust a business which does a lot of cash sales, it’s a lot harder to prove where each bill came from and there’s no way to do so if they only start monitoring after the fact like there is with Bitcoin.

enneff

> This alone trumps any arguments against bitcoin.

This is a ridiculous claim. Just because a technology can be used for good does not mean it is beyond criticism.

staticassertion

> It also enables people to finance themselves despite tyrannical restrictions imposed by bad governments. Using bitcoin I can send money to someone in Chi no a who's social rating was degraded by the CCP and who is forbidden from using banks.

In no way does bitcoin being blockchain based enable you to do this better or more effectively. It's just because it's a less regulated currency.

red_trumpet

And of the CCP ever finds out, he will end up in jail. And if they can link your wallet to you, you will not be able to travel to China anymore.

boringg

I had the same experience. The thing that gets me as well is that normally with the rise of new technology you get an excitement that is tangible. Like when the internet first xame around there were emails, multiplayer games via modem, websites. A whole plethora of new wonderful experiences. So far all I've really gotten after doing a lot of research is some good projects and a long tail of terrible projects/websites and a lot of scammers.

It really feels like with the NFT backlash in the gaming world right now that crypto hasn't found its landing and it really hasn't taken off - its kind of in this weird purgatory. Im hopeful but very suspicious at this point. I wasn't suspicious of “the internet” until it was around for a long time. Crypto is past its wave of this is cool and lets build stuff phase afaik and now everyone is trying to make money off it.

wodenokoto

In Dubai, buying real estate with bitcoin is a real thing, and by the looks of it also a big thing.

If nothing else, it shows that crypto has succeed in one of its goals: moving money between countries, without being detected/hindered by governments.

I mean, I don't know who buys real estate with crypto, but I am assuming that people who live in dubai and have large crypto values are bullish on crypto, and won't waste it for a low roi investment like realestate. So that leaves rich foreigners who wants realestate away from their own government and I can see them purchasing bitcoins as a way to siphon money out of their country.

Other than that, I am also out of ideas for useful uses of crypto currencies

galaxyLogic

Buying real estate with bit-coin, isn't that close to money laundering?

clairity

close to? sounds exactly like money laundering, since people who can move money legitimately wouldn’t do so through a relatively risky instrument like bitcoin. tax evasion is a likely entry-level reason, but often coupled with other sketchy illegalities.

shrimpx

If you bought your bitcoin with legit money, and then you exchanged the bicoin for a house, and you're doing your taxes correctly, how could that be money laundering?

leppr

That would be a stupid thing to do, as Bitcoin transaction chains are public and permanent, and the use of mixers[1] close to a deal will set off alarm bells.

Cash is an infinitely better money laundering vehicle.

[1]: tools that blur the transaction chain, masking the origin of one's coins.

yashg

That is classic money laundering. The only use case for funny money.

CRConrad

Strike the "close to", would be my guess.

cinntaile

Why would that be the case?

oblio

Doesn't Dubai have anti money laundering laws? It doesn't matter if you pay with seashells, don't they ask you where the money is from?

djdjfhsje33edh

Plenty of countries don't. I was just asking a friend if it would be difficult for an American to open a bank account in Thailand or Vietnam because of the reporting requirements. He said that with the proper introduction, there would no problem at all. Doesn't matter if you want to deposit $500 or $5 million. There might be an extra "service charge" for the larger amounts, but there will be no questions about its origin.

magicjosh

Here's an article About Dubai putting its entire land registry on the blockchain:

https://www.ccn.com/100-dubai-put-entire-land-registry-block...

yashg

"DLD has created the blockchain system using a smart and secure database"

A blockchain system using a secure database. Makes it abundantly clear, how much they understand what a blockchain is. Truly, future belongs to blockchain systems.

dmitriid

Funny how you read that glowing announcement and realize that literally nothing in that announcement requires a blockchain.

malwarebytess

That is what financialization does. Finance is a parasite that will destroy all potential if given room. To force finance to be symbiotic you must never allow them to control anything.

These ideas are best left in the academy, and then later financialized. The exception to this is internal R&D (like Bell Labs and countless other extremely productive corporate divisions.)

boppo1

Out of curiosity: How well have significant Bell Labs contributors been compensated? It seems to me that lost of current tech, and even 'future tech' not yet adopted has come out of Bell Labs. But how many of the engineers that came up with said advances settled for relative peanuts? Getting paid $250K for something that changes the world seems... less than adequate.

Maybe I'm just greedy.

I don't think so.

null

[deleted]

shlurpy

Those people are represent labor, not capital, and thus are never paid their share of profit under capitalism.

nly

Bitcoin had a problem to solve, it had a use case, from day dot... Satoshi set out to replace central banks that can inflate the money supply.

It was supposed to be relatively boring tech solving a niche problem (from the guy on the streets point of view)

grey-area

It was also designed as a pyramid scheme though to drive adoption. This was an unfortunate mistake and that and the inefficiency at scale doomed it as a currency.

pirate787

This is wrong. The original purpose was cashless payments between untrusted parties.

galaxyLogic

'Public voting' is not a technological problem but political one. There's a lot of opposition to making voting more accessible to everyone. Voting should be easy, and you don't need blockchain for that but maybe it could help. The question is who wants "voting rights".

tsimionescu

Unfortunately, trust in voting can only be achieved with paper voting, there is no technological solution to improve it that doesn't completely remove trust as well.

baobabKoodaa

Removing trust completely is a pretty high bar... but there are different voting schemes out there and some of them do a pretty good job of removing a lot of the trust. Cryptography is typically involved, but blockchain is not needed. I wrote more about this here: https://www.attejuvonen.fi/thesis/

shrimpx

Trust as in the public trusting the vote? I'm afraid you can put political spin on and create distrust in pretty much anything.

Ekaros

In person paper voting specifically. And that also really have many other things involved...

V__

Obligatory Tom Scott videos:

Why Electronic Voting is a BAD Idea - Computerphile | https://www.youtube.com/watch?v=w3_0x6oaDmI

Why Electronic Voting Is Still A Bad Idea | https://www.youtube.com/watch?v=LkH2r-sNjQs

jjtheblunt

the final paragraph seems to summarize the article :

"The more you think about it, the more “it’s early days!” begins to sound like the desperate protestations of people with too much money sunk into a pyramid scheme, hoping they can bag a few more suckers and get out with their cash before the whole thing comes crashing down."

epinephrinios

Future will tell. But the author is either acting on bad faith or they are not informed on the innovations that happened since then and are currently happening in the crypto space. And I am not even focusing on NFTs but on hardcore crypto stuff such as multisig and zero-knowledge proof protocols.

mirzap

Well, 10y ago is not ages ago. Email existed for 30 years before it was ready for consumers. Same is with the internet. Certain types of technologies require decades research and development. I would argue that in 20 years it will still be "early days" of blockchain. And only in mid 40 we will figure out apps and who nows what to fully utilize underlining technology. Right now we are just coping what we have outside of blockchain and put it on the blockchain. Same as people couldn't imagine how internet could possibly transform their business and life, we now can't imagine how Bitcoin and blockchain will transform our business and life in the future. It's too early.

_fizz_buzz_

I'd say with email the application was always crystal clear: It's like sending a letter, but electronically and therefore instantly. This must have been obvious to everyone in that space even 40 years ago. Maybe it wasn't obvious how big email would be one day, but there were definitely no doubts about what it would be used for. As someone who is trying to understand the applications of "crypto", it is very frustrating to hear stuff like "we now can't imagine how Bitcoin and blockchain will transform our business and life in the future". Please give me something! If we can't imagine it, maybe there is nothing there.

runeks

The application of Bitcoin is also crystal clear: distributed, digital money. It’s like gold, but electronic, and therefore much faster/cheaper in certain scenarios (and slower/more expensive in others).

Reasonable people disagree on whether this application is actually something we need, or will need in the future. But the application is clear as day.

redytedy

Except for that you can't take a bar of gold and view a public log of every wallet/transaction it has ever been in. Something like Monero would be better for your analogy.

jakupovic

Email is also used for authentication, all those 6 digit codes that come in for 2fa are doing so. Definitely not something that was imagined 40 years go.

kingofspain

Not too dissimilar to getting your bank card and PIN in separate letters. Just much, much quicker.

onion2k

we now can't imagine how Bitcoin and blockchain will transform our business and life in the future

40 years ago people on the cutting edge of tech had VHS video recorders to record broadcast TV. The tech grew slowly, became the dominant standard, and after 15 years in the mid-90s they were everywhere. 25 years later no one has one, or wants one, or even has an equivalent.

Don't assume too much about the future based on the present. Things can change in strange and unexpected ways.

I'm not saying Bitcoin and blockchain won't be around in 2040. They may well be. I'm saying current trends aren't a particularly good predictor of the future. They're wrong more often than they're right.

mojuba

It might be that the idea is too complex to be viable or useful. The graveyard of technologies created in the past decades stretches to the horizon, so if something doesn't work after 10 years doesn't mean it will work in the future. This is kind of obvious.

Specifically with blockchain my intuition is that, if its main selling points - immutability and decentralization - are already invalidated in the early days (10 years that is), the chances that it will recover are slim.

Complex tech tends to centralize to become cheaper. Also immutability is very problematic in terms of the right-to-forget and also in terms of illegal content and illegal operations.

Email's purpose and utility was super-obvious from day one, we just had to figure out how to make it more secure. Notice how email too became centralized, however.

unityByFreedom

Email required everyone to have a computer, plus infrastructure to connect them.

Blockchain has been waiting on a useful implementation since inception.

mirzap

No. Email didn't have useful implementation (UI) until 30y after it was invented. Only geeks and tech savy people were able to use it because it was not so easy to use. Sending messages was really hard, sending would often fail. So you would say, 25y after email inception there was no useful implementation and no usage by consumers, so technology is worthless. And there were people who were saying that, I'm sure. Same was with the internet.

Uehreka

Until 1998, my middle class American family didn’t have internet. I was a rather tech-curious kid, but until we actually had a second phone line run to our house and a new Gateway computer and a modem, there was this huge barrier to what I could learn about on our airgapped Windows 3.1 machine. My Dad was able to navigate the command line because he’d needed to on our previous DOS computer, so I feel like he could’ve handled email if we’d had a connection back then. I’d argue that infrastructure was a pretty big barrier to email catching on, not just the UI.

janandonly

I never understand critiques like these.

> "somehow no one appears to have managed to find a positive use for blockchains that wouldn’t be better served by blockchainless technologies"

There is now a sovereign nation state that accepted Bitcoin as a currency, and, mark my words, no doubt more will follow this 2022.

Replacing central banks, and by extension, their grasp on the limitless money printing, is the whole reason why bitcoin and it's blockchain exist. And it is working wonderfully well.

People in countries where the central bankers and politicians are letting them down are flocking to bitcoin and other later inventions (such as stable coins).

Just check these countries:

- Lebanon: https://www.aljazeera.com/economy/2020/2/25/distrust-in-leba...

- Turkey: https://etfdb.com/crypto-channel/as-turkey-lira-falls-bitcoi...

> "Rampant inflation is once again plaguing Turkey’s local currency, the lira, but one saving grace could be its citizens using bitcoin to supplant the plunging fiat currency."

- Also Turkey: https://www.nasdaq.com/articles/turkeys-inflation-is-an-exam...

- El Salvador: https://www.theguardian.com/world/2021/jun/09/el-salvador-bi...

- And El Salvador again: https://bitcoinmagazine.com/culture/bitcoin-el-salvador-geop...

throwaway98700k

By all accounts the adoption of that tech in El Salvador has been a disaster, the app is slow, buggy, not everyone has access and it’s easily exploitable for crime. Protests against it. Etc. I anticipate a reversal of this by the next government. Current governments cannot admit mistakes, so it’ll take a new term for it to be dismantled.

b0ner_t0ner

> has been a disaster, the app is slow, buggy, not everyone has access and it’s easily exploitable for crime

Sounds like early 2000s online shopping to me.

notpachet

Sounds like current online shopping...

suzzer99

There may not be a next govt in El Salvador for a while. Their populist president seems intent on staying in power by any means necessary.

epinephrinios

Uhm it might be hard to use but I completely reject the "exploitable for crime" part. Actually Bitcoin payments are a blessing for all those people that had to physically travel to Western Union branches to receive cash from abroad. Gangs frequently targeted such poor individuals and stole their cash. Bitcoin fixed this.

Passthepeas

https://en.wikipedia.org/wiki/Nayib_Bukele#Presidential_appr... I keep hearing this line, and yet Bukele's approval rating is over 80%

SanJacobs

Yes, I agree, and this is all very cool, however regarding this point:

> There is now a sovereign nation state that accepted Bitcoin as a currency, and, mark my words, no doubt more will follow this 2022.

Sure. That's true, but doesn't actually matter, imo., because the point of crypto is to:

> Replac[e] central banks, and by extension, their grasp on the limitless money printing

So approval from the government in the case of crypto is worth about as much as it is for making love. It's the losing side of a game saying "You know what, we'll be so gracious as to allow you to win". Never needed your permission to begin with.

PretzelPirate

You’re referencing the point of Bitcoin, not the point of crypto. Other platforms aren’t interested in destroying the existing financial system and would much rather digitize it and make it open to everyone.

WesternWind

I mean a significant portion of the world's money is created by fractional reserve banking.

lottin

Not just a significant portion, the vast majority of money in circulation is money created by commercial banks, not central banks. For example, in 2007, Euros issued by the ECB accounted for less than 15% of the supply of Euros (M1): https://en.wikipedia.org/wiki/Fractional-reserve_banking#/me...

larsiusprime

Kelsey Hightower said it best: https://twitter.com/kelseyhightower/status/14778718907230781...

"If something is too early to criticize it's also too early to evangelize."

bb88

Not if you have a heavy investment and depend upon other investors (or greater fools) to buy your shares.

quickthrower2

But it’s not too early to be a cult

mritchie712

Any sane web3 proponent would agree with this statement. Only the scammers wouldn't.

Sane people interested in web3 don't evangelize and are totally aware of and agree with most of the criticisms. If you criticized Ethereum as being expensive and inefficient, you'd get head nods from people that understand the space and pointed to projects that are trying to fix those issues.

lolinder

The problem is that when a space becomes dominated by the insane people, it's the insane people who drive its future. Any hope for a sane web3 depended on the hype starting after there was an actual use case. As it stands, web3's Eternal September began before the foundations were even laid, and it's going to be very difficult to retrofit them.

mw888

That’s absolute nonsense. Scammers and grifters making vaporware projects have no significant influence on the projects who spend their budget on development rather than marketing.

What you just said is “all these novice basketball players training the wrong techniques is a dire problem for those training effectively.” No it’s not, if anything investments in actual projects during relative, senseless mania is cheaper and easier than it ever was.

Dwolb

IMO L1 (Ethereum, Solana, Fantom, etc.) development is closer to building out a communications or telco network.

From that “hard” technology perspective, it’s very early days. And the apps that run on top of these L1s are fully limited by L1 bandwidth, latency, and blockspace.

So, I think we’re in the pre-dial-up days for blockchains and will need a couple more orders of magnitude improvement to be (universally) on par with today’s app performance.

rileyphone

The information bandwidth on block based cryptocurrencies is far too low to support these deeper levels of complexity, and I doubt will ever get much better. Blockchains, despite being a distributed phenomenon, still centralize the flow of information into one stream, the chain. Ethereum, by my estimation, operates at around 7 kB/s, and Bitcoin at 2kB/s. These are clearly glacial speeds - think of how limited an internet connection at those speeds is. How will more informationally needy systems be constructed on top of so paltry a base? The problem is a blockchain's protocol must somehow coordinate the distributed actions of its participants, which are generally spread out across the world. By centralizing information in the chain, they are exhibiting the same intractable slowdown that we would see trying to emulate a brain on a CPU.

Dwolb

I think we’ll see if bandwidth and latency improvements bring more application development. Solana and Avalanche are orders of magnitude faster than Ethereum and their ecosystems are rapidly evolving.

Btw Solana founder is ex-Qualcomm and worked on embedded distributed (multi-core) systems and Avalanche founder implemented a faster more elegant consensus algorithm. Can hear them discussing technical aspects of development: https://open.spotify.com/episode/632rPGnMZlHag7DJ1SCDUV?si=F...

che_shirecat

read up on L2 chains - both optimistic roll-up and zk-rollups. this problem you are breaking down has been the subject of study and development for years now and is nearing implementation - https://www.gemini.com/cryptopedia/layer-2-scaling-zk-rollup...

magicjosh

Good stuff, so you would suggest to the author that their examples are too narrow. Perhaps that smartphones, Uber, and Facebook all represented somewhat minor "time has come" type innovations, whereas you see Bitcoin as a development more like the internet itself, and that instead we are in the Arpanet days.

(Disclosure I own Bitcoin and Ethereum)

Dwolb

Yeah narrow or just on a different layer/level of abstraction.

Yup my mental model is we’re either in Arpanet days or multiple-competing-DOS days.

Daishiman

Early day Arpanet was infinitely more useful than all of this blockchain stuff.

magicjosh

Are there any other examples of recent + long cycle developments? Solar? Electric vehicles?

Part of me has come to expect such fast development (Facebook, Uber, Yelp!), but other modern industries must have longer cycles I just am not paying attention.

dmitriid

Yup. Of course everything that has "blockchain in it is "the next internet".

Now this ridiculous claim is taken further: it's not even the internet, but "the fundamental infrastructure of the internet".

Whereas all signs point to it being a Juicero, an Enron and an AT&T ISIS Mobile Wallet rolled into one.

chrischen

My purely anecdotal experience so far has been that crypto bulls have tended to be more business-y/finance type people and, even among technical people, the technical people who don’t actually know how a blockchain works. Not a good sign for the technology and its applications but I don’t think all crypto is useless… but a lot of the hype is definitely by people trying to get rich quick with a hand-wavy understanding of the technology.

A lot of people missed out on Bitcoin early days… best way to cash in is to fork it and voila, the crypto Cambrian explosion where most of the forks will eventually die off.

mw888

Exposure bias. Who are you going to see more? The thoughtful coder and innovator who spends their time working on problems, or the excited businessman telling everyone about that work? Even the more outgoing founders are overshadowed by influencer types, and that’s not surprising at all.

One dichotomy I have noticed in crypto is that non-involved “tech” people seem to understand crypto and the big picture much more slowly than economically minded people (no, not just speculators). People don’t usually understand that crypto currencies are an economic innovation using cryptographic primitives, though more recently the space has started driving cryptographic innovation as well.

chrischen

Well the excited businessman telling everyone about the work is the one hyping it to everyone. My point exactly is if it was just the hard working coder in a dark room everybody and their grandma wouldn't be buying into crypto right now. I'm also bullish on the utility of Bitcoin, as it allows for an almost cash-equivalent that's digital. Silk road took it as currency, and cybercriminals. These may be illegitimate businesses but they are businesses nonetheless.

democracy

"Crypto" shat itself in the area of payments (noone really needs or wants it and it provides 0 value), so now they are trying other angles - NFT, DeFi. The problem is the crypto influencers are losing touch with reality. You could at least bullshit someone clueless about cryptocurrency and payments, but it's really hard to sell the idea of collecting JPEGs or investing into DeFi (which aggressively described in the terms of a classic ponzi scheme for some reason) to the general public.

mw888

Ahh yes the “they” in crypto. The same “they” that people like you used to say would ‘turn it off whenever they wanted’ a few years ago.

jakupovic

So the people buying houses with crypto have dirty pants? Or in El Salvador, where BTC is on par with USD, they all have dirty pants? Please re-read your comment before publicly posting, as this is not advancing conversation, nor adding anything, but only exposes your narrowly held (wrong) beliefs.

democracy

El Salvador doesn't have its own national currency at all. And yes, imaginary people paying for houses in bitcoin is another example of a crazy meaningless argument. Maybe there is one or two, who knows. I think more people pay for properties in camels or Vodka bottles if we really search.

baby

That’s not how it happened. Crypto is seeing a lot of technical advances. At the same time, people find different ways to build on top of it.

democracy

One man's advance is another man's dead end.

baby

One man observes while the other keeps moving