this is a really great article, because it highlight a very important dialectic that many blockchain enthusiasts, developers, entrepreneurs, and speculators don't acknoweldge. I would however, suggest that the issue of governance is not an "all-or-nothing" choice. Probably some of the blockchain technologies that try to do things like "link to a central bank", will suffer from a difficulty in establishing product differentiation from traditional currencies and transaction schemes; but the blockchain technologies that live on the more distant side of the spectrum (providing an, if imperfect, implementation of distributed trust) like the original bitcoin, will survive.
The blockchain paradox: Why DLTs may do little to transform the economy
171–180 of 355 posts
Re: The blockchain paradox: Why DLTs may do little to transform the economy
#172Earlier quoted context omitted.
Well it's in response to your rebuttal. > Where is the revolution? A common thread among cryptocurrency enthusiasts is that the revolution is coming... except it never does. A technology doesn't need to have all of its potential realized in the first few years of its existence. > Where is the disruption? Bitcoin is a smidgeon of a fraction of the commerce activity happening on the internet The Internet was a fraction…
> Literally every dismissal of cryptocurrencies you made would have applied exactly to the Internet in the early '90s or prior. It seems I'm not getting through to you. Just because two things have something in common doesn't mean that they're the same thing. Showing that people were skeptical of the internet and blockchains does not demonstrate that blockchains will be as successful as the internet. There is no conn…
I guess I just feel like your rebuttal would be stronger if its only points weren't the same, yet ultimately irrelevant in the case of a prior technology with many similarities.
Of course they're not the same thing. That doesn't mean it's now totally valid to claim that it won't be successful due to the same roadblocks that the Internet overcame easily.
Do you have any arguments against cryptocurrencies that don't mirror early problems the Internet had, that people warned about, but ended up being very solvable? I think that'd be a lot more convincing.
Re: The blockchain paradox: Why DLTs may do little to transform the economy
#173If I had a Bitcoin for every skeptic that posts a blog on why it can't work... This may just be my general observation but I feel like Silicon Valley hegemony has a grudge against crypto currencies and I'm not sure why. For an industry that has constantly tried new things and saw potential where no one else did, I just don't see the love for the potential of smart contracts, DApps, etc. And how this is just the begin…
What's most off-putting for me is the political ideology that often accompanies bitcoin. It's a sort of Ayn Rand-inspired libertarian anarchy that, among other things, wishes to replace democratic institutions (like central banks or courts) with algorithms. It's too close to the conspiratorial and/or anti-establishment mindset to be comfortable.
> What's most off-putting for me [...]
... may be most appealing to others.
> It's too close to the conspiratorial and/or anti-establishment mindset to be comfortable.
"counterantidisintermediation"
Re: The blockchain paradox: Why DLTs may do little to transform the economy
#174Earlier quoted context omitted.
I asked for a practical example. Just because a bunch of people decided to spend their money on internet tokens does not mean it is useful. How is it useful ?
Groups of actors across the world can make an agreement that is enforced by a smart contract. When an actor fails to live up their obligation they are refused payment. There is no way to take off with something that is not yours. There is no reliable or efficient way to cheat. You don't have to know the other actors you are making an agreement for something with. Can you do this now without a smart contract? Of cours…
> There is no way to take off with something that is not yours. There is no reliable or efficient way to cheat.
I'm a bit rusty on my crypto-currency knowledge, but I seem to remember that there is the possibility of a 51% attack, wherein if an evil actor managed to control 51% or more of the network, they could basically wreak all sorts of havoc on the network, from denial of service, to double-spending of coins to rewriting of (recent) transaction history.
As for feasibility, some mining groups have already briefly obtained 51% control of the network "by accident", but if you want to go the black hat route though, DDOS a large portion of the network, spin up a few dormant bots and presto, you have your 51%.
So it isn't impossible to cheat, and certainly not impractical.
This is a major problem. Has this problem been addressed at all?
Re: The blockchain paradox: Why DLTs may do little to transform the economy
#175I don't understand why "competition" should not work? Switching currencies is easier than switching citizenship. There are plenty of alternative cryptocurrencies with different rules. User can switch to different ones (and Ethereum is quite a challenger at the moment). The network effects are great, because otherwise everything would explode into a million different currencies.
Currencies need to have systems in place that work to make them stable and preserve value, otherwise they're just tools for transactions. This might be a better state of affairs if currencies are backed by something exchangeable (e.g., joules of carbon neutral energy, etc...). We don't have many currencies like that in the world, as I understand it. Most are essentially contracts between governments that may or may n…
SolarCoin is one such effort.
Re: The blockchain paradox: Why DLTs may do little to transform the economy
#176Earlier quoted context omitted.
The source of the distaste is obvious: breathless hyperbole without much substance to show for it. Posts like yours are a great example of it. In this very comment you write: > leading the charge on what could be the next major technical revolution Unsubstantiated hype. Where is the revolution? A common thread among cryptocurrency enthusiasts is that the revolution is coming... except it never does. When you talk abo…
Watch this video [1] of Bill Gates explaining the value of the Internet to David Letterman, where he's just not getting it at all. Bill's telling him the things it can do relative to David's interests, but he just sees those as problems that don't really exist because they've already been solved. It took decades before the Internet was useful to "the masses." I don't think there's some conspiracy among VCs, but I do…
The Internet opened up a whole new world of applications. Distributed ledgers do not. They are a complex and horribly inefficient solution to a very niche problem that crypto currrencies like Bitcoin have. But outside of that realm, they offer next to no technical advantages that would justify the exploding costs incurred by implementing this technology.
Re: The blockchain paradox: Why DLTs may do little to transform the economy
#177Earlier quoted context omitted.
> In the UK it costs £3 and is searchable online. If it costs $300 then My short text didn't give enough context. In the USA, that $$$ isn't really for the "search"; it's to pay for the "title insurance" . That title company insures that the buyer is getting a "clean title" with no conflicting claims of ownership from others he doesn't know about. The "search" is just one component of labor of what you're paying for.…
If "dirty" titles are an issue (and title insurance costing $300 suggests it is), Why is there no government department (state or federal) holding the title registry? That would also solve the problem. Once again it seems like this is a social issue not a technical issue.
>Why is there no government department (state or federal) holding the title registry?
The governments (e.g. county courthouses) do store copies of the documents such as deeds and transfers. They stamp them with their seal so in that sense, they do "hold the authoritative title records".
However, there is no computer database with rows for all real estate that has a binary column called "CLEAN_TITLE" with values TRUE/FALSE.
Therefore, the actual state of a "clean title" isn't a flag but a case-by-case determination based on documents analysis. What an employee from a title company will often do is actually drive down to the court house and sit there looking through document archives to trace the chain of sales. This also includes looking at microfiche films[1] if the courthouse hasn't migrated all their images to electronic image databases. If the worker feels confident there are no outstanding claims, the title company can issue "insurance" that the title is clean. (Occasionally, the determination was wrong and the title company has to pay out the insurance because of their mistake.)
If the property gets sold again, another title company worker may do the same redundant "documents analysis". (Because new claims can be recorded against the deed since the last time the property was sold.) Yes, it's a really inefficient process!
Conceivably, a buyer could buy property without title insurance but since most people require loans, a bank won't lend money unless it has assurance the title is clean (because that property is the bank's collateral so it has to have confidence that nobody else has claims that supersedes the bank's.)
Could the governments create a convenient centralized database to solve those issues? Yes. But some people might prefer to have a distributed ledger to bypass the government holding those records. (E.g. the courthouse charges $20 to "record deed documents" or "$1 per page for copies of deeds", etc). The distributed ledger could theoretically not require those fees or make them very small.
[1] https://www.google.com/search?q=microfiche+reader&source=lnm...
Re: The blockchain paradox: Why DLTs may do little to transform the economy
#178Earlier quoted context omitted.
You did ask for practical . First I'll say this isn't easy to answer in concrete terms. But someone will one day. One concept would be to raise funds that can allow you arbitrage at a scalable level. Request funds (ICO) and have the smart contract enable a certain subset of those funds for your organization to use to arbitrage other crypto's. Profits are spread across stakeholders based on their investment, represent…
> First I'll say this isn't easy to answer in concrete terms. But someone will one day. This is not unreasonable, but you have to admit that it is a far cry from imminent revolution and a key reason why people are skeptical of this technology especially considering the bottomless pit of grandiose hype that accompanies it. > One concept would be to raise funds that can allow you arbitrage at a scalable level. Request…
I wouldn't say imminent. And I wouldn't even say probable. But possible? For sure.
I find the entire thing interesting and in fact the most boring bit is the instant millionaire greed fueling unfounded hype.
If I had the great idea I wouldn't be hear talking about it. I'm getting a better and better grip I feel but it could all be fallacy too!
But, someone or some group are going to be far more able to see the bigger picture I imagine and unleash something completely new, practical and useful.
Re: The blockchain paradox: Why DLTs may do little to transform the economy
#179Earlier quoted context omitted.
I agree with this but you might be missing my point. Crypto as a store of value and the ability to transfer funds is nice and all but it's not the big picture. I think focusing on that you rightly see limited practical application in large parts of the world, such as the USA. The real revolution is in smart contracts and virtual machines that run on a blockchain and the ability to define ownership of a distributed or…
> The real revolution is in smart contracts and virtual machines that run on a blockchain and the ability to define ownership of a distributed organization to distribute profits accordingly. Blockchains on blockchains that having turing complete contracts that can guarantee there isn't even the ability to cheat the distributed, mainly anonymous organization participants. Sounds like something utterly complex even to…
"Turing complete contracts" were a terrible idea, as the DAO debacle and subsequent fork demonstrated. If the people behind the DAO hadn't been the same people as the people behind Etherium, they would have been screwed.
Machine-readable contracts need to be much simpler and much clearer to work. I've suggested decision tables as a format; those are declarative, guaranteed to terminate, and have a simple chart form that's easy to understand. Yes, they're more limited.
Re: The blockchain paradox: Why DLTs may do little to transform the economy
#180Earlier quoted context omitted.
I agree with this but you might be missing my point. Crypto as a store of value and the ability to transfer funds is nice and all but it's not the big picture. I think focusing on that you rightly see limited practical application in large parts of the world, such as the USA. The real revolution is in smart contracts and virtual machines that run on a blockchain and the ability to define ownership of a distributed or…
> The real revolution is in smart contracts and virtual machines that run on a blockchain and the ability to define ownership of a distributed organization to distribute profits accordingly. Blockchains on blockchains that having turing complete contracts that can guarantee there isn't even the ability to cheat the distributed, mainly anonymous organization participants. Sounds like something utterly complex even to…
Make it better. Programming with switches was hard. High level languages were built. Managing memory was hard. Higher level languages were built.
There's this amazing lack of vision and inability to see that things can and will be innovated on. Why would it be anywhere near perfect by this iteration? Why would you expect that?
Also in terms of complexity - have you ever read an actual legal contract? Do you think 99.9% of people understand that?