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Wall Street rethinks blockchain projects as euphoria meets reality

reuters.com

131–140 of 487 posts

Re: Wall Street rethinks blockchain projects as euphoria meets reality

#131
post #45
post #7

It is interesting that even in an article like this that they still say things like "for all its potential, blockchain is still in its early days." It is sticking with the unfounded assumption that it will be a success in the future, if only it is given more time. In technological terms, it is old. Innumerable efforts have been attempted, yielding almost no fruit. At what point are the fundamental assumptions going t…

I think the fundamental assumption is that "Satoshi invented a useful solution to decentralized consensus". What people don't realize is that Satoshi's solution only works if two assumptions hold true: 1. Mining is decentralized: If mining is centralized than relying on proof-of-work for consensus is waste since the centralized entity controls the blockchain anyway. 2. Consensus rules don't change: If you see the thr…

I disagree with 1, because the real controller in any cryptocurrency is the software users of the coin are running. You could have trillions in mining hardware but that doesn't matter a bit if a popular implementation changes the mining algorithm to no longer work on your hardware and the userbase starts using that hard fork.

Its the problem that the advocates for larger blocksizes in BTC ran into. So long as the ecosystem itself was predominantly going to stay on the bitcoin core implementation, the advocates for change couldn't force it. Eventually they just hard forked into BCH, while the more popular original chain keeps on going.

That also means that nothing is really decentralized unless you can cause sea change amongst all participants in a cryptocurrency - if you disagree with what the most common implementation is doing, you can't do squat about it, and commit access is never decentralized or democratized. Theres always someone with the master key to the repo. And we have seen plenty of evidence that once established unseating a popular implementation of any crypto is nigh-impossible, regardless of what the developers do.

Re: Wall Street rethinks blockchain projects as euphoria meets reality

#132

Earlier quoted context omitted.

Blockchain is simply a sexy term for a distributed ledger, which has its place in a limited set of use cases.

The question that no one bothers to ask is, "What problem is this technology solving that can't be solved cheaper and just as effectively with 'traditional' technology?" When you look at it this way I think the realistic use cases go way down.

yeah...because nobody has asked this.........

Re: Wall Street rethinks blockchain projects as euphoria meets reality

#133
post #45
post #7

It is interesting that even in an article like this that they still say things like "for all its potential, blockchain is still in its early days." It is sticking with the unfounded assumption that it will be a success in the future, if only it is given more time. In technological terms, it is old. Innumerable efforts have been attempted, yielding almost no fruit. At what point are the fundamental assumptions going t…

I think the fundamental assumption is that "Satoshi invented a useful solution to decentralized consensus". What people don't realize is that Satoshi's solution only works if two assumptions hold true: 1. Mining is decentralized: If mining is centralized than relying on proof-of-work for consensus is waste since the centralized entity controls the blockchain anyway. 2. Consensus rules don't change: If you see the thr…

But one of the biggest selling points of Bitcoin itself was mathematically limited supply. A new cryptocurrency appearing every day fundamentally undermines the value proposition.

Blockchain may have value as a decentralized ledger in other areas, but “lots of blockchain based currencies” aren’t really one of them since it’s self-sabotaging.

Re: Wall Street rethinks blockchain projects as euphoria meets reality

#134
post #45
post #7

It is interesting that even in an article like this that they still say things like "for all its potential, blockchain is still in its early days." It is sticking with the unfounded assumption that it will be a success in the future, if only it is given more time. In technological terms, it is old. Innumerable efforts have been attempted, yielding almost no fruit. At what point are the fundamental assumptions going t…

I think the fundamental assumption is that "Satoshi invented a useful solution to decentralized consensus". What people don't realize is that Satoshi's solution only works if two assumptions hold true: 1. Mining is decentralized: If mining is centralized than relying on proof-of-work for consensus is waste since the centralized entity controls the blockchain anyway. 2. Consensus rules don't change: If you see the thr…

>and also enabling things like money laundering, drug trafficking, etc.

And that is bad?

Re: Wall Street rethinks blockchain projects as euphoria meets reality

#135

What does "blockchain" even mean in this generalised context? When we are talking about crypto currencies, it is a distributed database with a consensus mechanism that is extremely costly to run. But this is not something you would need or want in most other situations, because there is always some degree of trust with your counterparties (and legal recourse if necessary). If we strip away the consensus mechanism, al…

This is my question as well. Blockchain is perfect for a digital currency, yes. But where else in the real world is it even applicable?

Anything where you need to track serial ownership of something. One example of which might be car titles.

Re: Wall Street rethinks blockchain projects as euphoria meets reality

#136
post #45

Earlier quoted context omitted.

I think the fundamental assumption is that "Satoshi invented a useful solution to decentralized consensus". What people don't realize is that Satoshi's solution only works if two assumptions hold true: 1. Mining is decentralized: If mining is centralized than relying on proof-of-work for consensus is waste since the centralized entity controls the blockchain anyway. 2. Consensus rules don't change: If you see the thr…

> Mining is decentralized Cryptocurrency mining is as close as one can get to a theoretical free market in the real world. Free markets have known modes of failure [1]. One of these is where first-mover advantage and economies of scale combine to produce a barrier to entry; the result is oligopoly or monopoly. [1] https://en.wikipedia.org/wiki/Market_failure

[deleted]

Re: Wall Street rethinks blockchain projects as euphoria meets reality

#137

Earlier quoted context omitted.

Market cap in no way equates to "created value"

Sure it does. It's created a ton of value for myself and anyone else who didn't buy during a peak.

If I buy a grain of sand off of a beach for $1, the market cap of that beach is trillions of dollars. That doesn't mean the beach produced trillions of dollars.

Re: Wall Street rethinks blockchain projects as euphoria meets reality

#138
post #7

It is interesting that even in an article like this that they still say things like "for all its potential, blockchain is still in its early days." It is sticking with the unfounded assumption that it will be a success in the future, if only it is given more time. In technological terms, it is old. Innumerable efforts have been attempted, yielding almost no fruit. At what point are the fundamental assumptions going t…

I think about 70% of blockchain related stuff is hype. However, there have been blockchain related projects that have been useful:

In Mexico for example: http://iireporter.com/amis-and-ibm-collaborate-on-blockchain...

I saw a very good presentation regarding this HyperLedger project, and IMO this kind of projects are the ones that will form the future of blockchain technology.

Re: Wall Street rethinks blockchain projects as euphoria meets reality

#139
post #45

Earlier quoted context omitted.

I think the fundamental assumption is that "Satoshi invented a useful solution to decentralized consensus". What people don't realize is that Satoshi's solution only works if two assumptions hold true: 1. Mining is decentralized: If mining is centralized than relying on proof-of-work for consensus is waste since the centralized entity controls the blockchain anyway. 2. Consensus rules don't change: If you see the thr…

> If you change the consensus ruleset...then you need an oracle to tell you which chain to choose. What are you talking about? The rule to choose the correct chain is well defined and simple. The longest chain, i.e. the one with the most work done, is the correct chain.

The really funny thing is that we are going to see more and more coins moving towards regular changes to their algorithm to keep ASICs out, and effectively surrender their decentralization.

Taken to the logical conclusion, a supernode that is issuing algorithm changes is no different from a supernode that is signing blocks directly, just vastly more inefficient. Since you are already centralized, there is no reason to have miners at all. It becomes a ponzi scheme where the rewards are paid out randomly to participants.

Re: Wall Street rethinks blockchain projects as euphoria meets reality

#140
post #122
post #100

Earlier quoted context omitted.

You do need middlemen. The middleman is whatever service you must use to convert btc or eth to local currency which will actually be accepted for payments.

No. You don't need "local currency". With widespread adoption you can just pay sellers directly with cryptocurrency.

You just moved the goalpost by miles.

The question is whether Bitcoin and Ethereum have provided value. "Have" means in the past up to and including the present.

You are implicitly agreeing with the statement that Bitcoin is only speculative, by admitting that it will only be useful without middlemen in a hypothetical future where it achieves wide adoption.

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