Reflections: The ecosystem is moving

Bitcoin is a perfect example of this. It might stick around for a while mainly because so many people are already invested in it, but when it comes to features Ethereum runs circles around Bitcoin. On the other hand Ethereum will probably never be fully finished.

Like there's a review on the Android Signal app complaining that it asks for too many permissions, and it does ask for an arm, a leg and your soul, with the reply being unprofessional imho. I understand that this is open-source, but if you publish it and want users, you need to act professional, otherwise it shouldn't be a surprise when people complain.

To the subject at hand, I strongly disagree.

Moxie says that email is frozen, being why it is unencrypted, blaming the lack of progress on it being federated. But you know, I'm willing to bet that in 10 years from now WhatsApp and Slack will be both dead, just like Yahoo Messenger and ICQ before them, while email and IRC will still be around.

And I think that email is unbeatable, because it is federated, because it's governed by standards and because in spite of all constraints, it's quite adaptable, being the kind of platform supporting short term proprietary solutions because (and not in spite of) its client/server decoupling.

Slack for us is just a long and one dimensional stream of greetings, jokes, warnings and meaningless blabbering. Email on the other hand is the archive of everything we do, being the Git of our interactions and the primary channel for knowledge dissemination.

Is it unencrypted? Sure, but it doesn't matter though. Because we are willingly trading that for a capable search engine and a good web interface. Trade secrets aren't communicated over email anyway.

I think Moxie is missing the point. He's emulating WhatsApp, but you can't beat WhatsApp at their own game. Did WhatsApp really deliver encryption to 1 billion users? Well, those are 1 billion users that probably won't use Signal or chat with Signal users. Oops.

I wonder how much of this is specific to messaging services, though:

After all, messagers are both real-time and strongly biased towards current information. This means it's both very easy no notify people of a new account and relatively painless to close down an old one - you rarely have valuable archieved Whatsapp messages that you can't afford to lose.

Finally, thanks to platform notification APIs, it's very easy to run different messengers at once, so if your social network is split between different services, that's usually not a problem.

I don't see how those qualities are present in other services which have become more centralized - e.g. email, cloud storage, more persistent social networks or publishing. If I'd like to shut down my Facebook account and switch to some other hypothetical network, without losing all my contacts, that's going to be a lot more difficult than switching messengers.

Also note that smartphone apps are pretty much "walled gardens within a walled garden" as of now: Yes, it's easy to port my contacts from one android app to another android app or to run different messenger apps in parallel. But that's because I'm actually just giving different apps permission to the same underlying APIs and database. Shutting down my Google account and migrating to a cempletely open alternative: not so easy.

I do agree with the post that centralized services de facto are more sucessful than federation in the current ecosystem. But I'd argue that centralized services still have a lot of disadvantages for their users. So maybe we should start analyzing why this is the case instead of just shrugging and saying this is how the works works.

His argument applies for any centralized top-layer services built on top of open substrates. Because the substrates are open, users can relatively easily switch between centralized services, which lowers the badness of centralization, which in turn makes centralization a more reasonable tradeoff to make.

The question he didn't address, I think, is what happens in the case where you have centralized services emerging on top of another centralized service. In that case users might be able to switch their top-level service providers, but it would be much harder to switch the lower-level provider.

But then again, that's exactly the lesson that everyone in the software industry learned with the dominance of Windows as a platform in the '90s and early '00s, and I think that's why you see so many companies building proprietary layers on top of open source components, and the current growth of cross-cloud compatibility libraries. The user-facing service providers want to make sure they can never be hurt by a centralized platform underneath them. And that's the dynamic that I hope will end up protecting users as well.

Miner centralization is a huge problem for Bitcoin. The fact that 11 entities control >90% of the hashrate, and that 2 control >50% of the hashrate is a huge issue for Bitcoin. The pressures we understand to be causing this are more significant in Ethereum at scale. Ethereum is not even at scale and already is doing worse than Bitcoin in terms of hashrate centralization.

Ethereum also has significant scalability problems. Bitcoin struggles to hit 4 transactions per second, and every transaction on Ethereum is substantially heavier per transaction than Bitcoin. That scripting system is not free, and already Ethereum is 20% as heavy as Bitcoin despite being 1/5th the age and having 1/10th the usage. And that's before the fancy apps like Augur have gained traction. Augur is significantly heavier than anything running today, and it's definitely not the heaviest app that people have gotten excited about.

And the development is almost fully centralized. The current state of Ethereum is that what Vitalik says is what will happen, and while there are people who could shut him down... they won't. At least not in the near future. Ethereum has already performed hardforks and has several more planned.

I agree that Bitcoin has taught us a lot of lessons that have paved the way for its obsolecense. But I don't think that Ethereum learned them, and I think that Ethereum will seem a lot less attractive after it has to deal with demand matching what is currently demanded from Bitcoin.

I would almost go as far as saying they are orthogonal products. Bitcoin, above all else, prioritizes decentralization. Ethereum prioritizes features and flexibility, at the cost of scalability and centralization.