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Beyond the Bitcoin bubble

nytimes.com

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Re: Beyond the Bitcoin bubble

#101

Post by acdha »

rythie wrote: post #40
brndnmtthws wrote: post #14

Is anyone else tired of hearing the word 'bubble' applied to everything? Whether we're talking about tech stocks, chicken futures, tulips, or Bitcoin, it's become a really tired and meaningless term. You can't know if an asset is in a 'bubble' until long after the bubble has burst. Bitcoin is far from having burst, so this article and all those that came before it offer nothing new or insightful. Please, let's move p…

We had the dot-com bubble, but it didn't stop the internet from changing everything in fundamental way. Google, Facebook and Amazon are in the top 10 most valuable companies in the world - all completely dependant on the internet for the business model. Granted webvan and pets.com didn't make it, but it didn't mean the internet had failed as an idea.

That’s a common marketing claim but the comparison has problems: Bitcoin is turning 10 without a single application where it has a significant advantage over the status quo unless you count ransomware. In contrast, as soon as the internet became available to normal people they had immediate new or improved options for a bunch of different activities.

Yes, speculators backed a lot of bad business ideas but that was because people were getting online in droves because there were so many uses. Those companies failing didn’t change that, especially since there were so many examples showing that concepts were solid: e.g. a dotcom losing money on each sale didn’t mean online stores were doomed since Sears had proven the model many decades earlier.

Re: Beyond the Bitcoin bubble

#102

Post by UncleMeat »

davidsong wrote: post #84
VMG wrote: post #79

Earlier quoted context omitted.

It can be equally well done with a Postgres database.

And leave all the INSERTs and SELECTs to a trusted third party like Uber?

I mean, you are still running some client code you have to trust. People who want to take taxi rides aren't going to build their own client to interface with the taxi blockchain. What is the difference if the database is distributed instead of centralized?

Re: Beyond the Bitcoin bubble

#103

Post by todd_wanna_code »

nabla9 wrote: post #86
todd_wanna_code wrote: post #57

Earlier quoted context omitted.

Derivatives are just instruments to bet against or for market trends of assets. There are futures contract, options, swaps and other derivative vehicles for every market, be it cryptocurrency or forex. What makes you think the coin part represents that derivative?

A derivative is a security with price that depends on the value of the underlying asset. Bitcoins are derivatives for the blocks in the blockchain. You find a new block and you have a coins. Bitcoin value depends on the value of the underlying, the blockchain network.

Bitcoins are asset, plain and simple. Fiat currencies are derivatives, gold is not. There are derivative instruments on top of gold that let you make money on its market trends, but saying gold is derivative is totally meaningless. The bitcoin protocol gives bitcoin asset value. Now the speculative price market is a derivative, but that's not bitcoin, that's an instrument for people to make money on top of bitcoin.

Re: Beyond the Bitcoin bubble

#104

Post by DSMan195276 »

vec wrote: post #63
thisisit wrote: post #31

Earlier quoted context omitted.

I tried some of the introductory stuff and even that is difficult for me. How about an ELIF of the goals of the coin?

There's two separate things that get conflated in these discussions. The first is the blockchain, which is a technical innovation that allows a client to decide which version of a shared event log to trust, even if it doesn't trust any of the servers attempting to perform the update. The ELI5 version is that the record that took the most total work to generate is correct. Since generating a fraudulent record requires…

The problem with the 'blockchain without a coin' idea is the incentive. Why would people spend money to mine a blockchain which provides nothing to pay them back for it? Without the incentive, why would you care who is mining the blocks, and why would care about mining blocks faster then other people? You wouldn't.

But at the same time, without having that race to have the most mining power, the argument that it is computationally infeasible to change the blockchain becomes incorrect. There is now no guarantee that the amount of 'work' currently keeping the network going is actually enough to be computationally infeasible to change if someone buys enough computers.

Bitcoin technically doesn't guarantee the last detail either, but by paying miners it becomes worth it to them to keep buying the fastest hardware and most hardware they can.

Re: Beyond the Bitcoin bubble

#105

Post by smuemd »

buckie wrote: post #50
nabla9 wrote: post #5

I hope the technology matures beyond 'blockchain' and marketing drops the 'coin' moniker and the gold rush dies down. Cryptographically verified distributed log files should have negligible hype value and be hidden part of the infrastructure. I predict that 10 years from now normal relational databases have infrastructure for shared, authenticated and verified rows and columns and we laugh at the ICO era.

> I predict that 10 years from now normal relational databases have infrastructure for shared, authenticated and verified rows and columns Agreed, though with the caveat that this is for transactional systems closer to the settlement/long term storage layers where the added assurance is useful. The performance hit for a traditional (linear) log is too large otherwise... though you can do a causally consistent version…

"dropping most of the backend application layer (currently filled by django/rails/etc) in favor of a Vue/React private blockchain arch."

I second that.

Re: Beyond the Bitcoin bubble

#106

Post by martin1975 »

The answer to the fundamental ills of both Ethereum and Bitcoin is addressed in Cardano, which has been hard at work for 2+ years to create Ada and the first formally verified PoS type algorithm, Ouroboros.

I wish more people would wrap their heads around the rigid approach to developing Ada that Cardano's taken so the light will come on... sort of like seasoned imperative language programmers who get bitten by the FP bug, the same kind of cathartic effect is achieved once you begin to understand the fundamentals of what Cardano is doing.

Visit CardanoHub.org for more info and get ready to be processing new info for at least a week to begin to understand it.

Re: Beyond the Bitcoin bubble

#107

Post by sho »

decentralised wrote: post #100
sho wrote: post #94

Earlier quoted context omitted.

I've looked at that first article before. Nearly every single example listed could be done with a standard DB and/or required centralised trust. The author of the article doesn't appear to have put two and two together that if the land registry in Ghana wants a centralised public DB then obviously only the land registry itself should ever be allowed to write to that DB and why on earth do you need a massive, slow pub…

So, for transparency... I'm the author of both articles. It's true that they could be done with a standard DB which would be managed like most of the other public / government IT throughout the developing world. The key to understanding the use cases is to look at the blockchain capabilities one by one and see where Ghana benefits from having a hard to modify public database. If there is any subject that you would li…

> Ghana benefits from having a hard to modify public database

I am very much on board with that idea. I work in finance and write-only is practically a law. I just don't see why you need ethereum to implement it; in fact it seems a terrible, overly complicated way to do it.

It is good though that the blockchain hysteria is inspiring governments to think about these concepts though.

On your disclosure - despite my criticism they are good articles and do get one thinking.

Re: Beyond the Bitcoin bubble

#108

Post by v64 »

It's strange to me how there are many among the Hacker News crowd who can read an article like this and have doubts about its thesis. You lived through the 80s and 90s right? I can't count how many times in my life I was told no one would ever need a computer in their house, we've gotten along for decades just fine without them. No one will ever buy books online, that's ridiculous, you can go to the store and have one right now. The internet is just a niche chat program that will never have any use in business, etc.

Our uses of cryptocurrency and blockchain technology now are similar to how we once used the power of the web to create Geocities pages with nothing more than MIDIs, scrolling text, and under construction gifs, because we didn't know what we were doing yet. But the early computer and internet pioneers were able to see past the proofs of concept and build on those ideas, to create the modern internet we have today.

Bitcoin may cease to exist as a software product, but I think the innovations that it has spurred on will be with us for some time. This technology has the possibility of making business much more efficient by reducing costs that are associated with distrustful parties having to rely on (and pay money to) third party escrow/auditing services. If I want to send a large sum of money to someone else now, I have to rely on third party services such as banks or Western Union to facilitate that transfer.

If you still continue to think "well that can be done with a SQL database now", you're completely missing the point. There's nothing wrong with relying on third parties, but now we have technology that allows us to choose not to if there's a need for it. In that regard, cryptography shares many of the same characteristics. We could communicate securely before public key cryptography was invented, but it broadened the scope and security of such operations, to the point where we espouse using https for all websites, not just ones requiring security. When the time comes, why would you trust a third party if you didn't have to?

Re: Beyond the Bitcoin bubble

#109

Post by nabla9 »

simias wrote: post #90
nabla9 wrote: post #5

I hope the technology matures beyond 'blockchain' and marketing drops the 'coin' moniker and the gold rush dies down. Cryptographically verified distributed log files should have negligible hype value and be hidden part of the infrastructure. I predict that 10 years from now normal relational databases have infrastructure for shared, authenticated and verified rows and columns and we laugh at the ICO era.

>I predict that 10 years from now normal relational databases have infrastructure for shared, authenticated and verified rows I'm not sure I understand what you're predicting exactly. The big breakthrough of bitcoin is having a globally shared ledger without requiring any trust. In my experience most relational databases have a relatively straightforward trust model (i.e. the DB belongs to the organization using it a…

>I'm not sure I understand what you're predicting exactly

General bookkeeping and shared transaction logs that improve trust and transparency. Improving trust don't always require massively distributed ledgers. Just sharing them with counterparty and having mutual cryptographic agreement is enough for many applications.

Re: Beyond the Bitcoin bubble

#110

Post by vkou »

joosters wrote: post #32
hesdeadjim wrote: post #2

I am personally hoping we can survive the speculation craze and reach a point where we can use the block chain technology in revolutionary (or even evolutionary) ways. Since it’s tax time I can’t help but feel that the true long term danger to block chain technology isn’t draconian government regulation, it’s the IRS. For example I have a transaction earlier this year where I purchased some software for $15 BTC equiv…

Why should crypto currencies get special tax treatment?

Because it's different this time, and I stand to make a lot of money.
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