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Hundreds of Bitcoin Wannabes Show Hallmarks of Fraud

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Re: Hundreds of Bitcoin Wannabes Show Hallmarks of Fraud

#61

Post by lend000 »

hudon wrote: post #6

- The space is littered with fraud. - Wallets have bugs that lose hundreds of millions of dollars - Energy consumption forecasted to hit 0.5% of the world’s electricity consumption by end of 2018 - Promoters yelling “decentralize everything” while exchanges, development teams and mining are all highly centralized - No legal use case found to date Blockchain is a parasite on society.

- Signed, someone who wishes they didn't dismiss Bitcoin the first time they heard about it.

Blockchain is a brilliant and revolutionary technology. Is cryptocurrency the killer app? Maybe, but in any case it's financing the development of decentralized projects which may solve difficult problems in the realm of self organizing machines, artificial intelligence, mesh networks, trustless systems, transparency, etc.

It gets old seeing educated people on HN trying to frame anything-cryptocurrency in the most negative light possible without productive discussion, most often out of jealousy and bitterness about not partaking in the profits enjoyed by those who saw potential earlier and bought some.

Re: Hundreds of Bitcoin Wannabes Show Hallmarks of Fraud

#62

Post by hockeybias »

kbody wrote: post #40
hudon wrote: post #6

- The space is littered with fraud. - Wallets have bugs that lose hundreds of millions of dollars - Energy consumption forecasted to hit 0.5% of the world’s electricity consumption by end of 2018 - Promoters yelling “decentralize everything” while exchanges, development teams and mining are all highly centralized - No legal use case found to date Blockchain is a parasite on society.

- You could say that for cash and internet as well, but I hate it too that currently the majority of the space is overrun by scammers & useless ICOs. - As for wallet bugs: if you're talking about Ethereum or low-quality software projects yes, but for Bitcoin it's been a long time since that was an issue - Regarding power: setting aside all those sensationalistic headlines. Crypto-miners are a way that enable renewabl…

Puh-lease...

Re: Hundreds of Bitcoin Wannabes Show Hallmarks of Fraud

#63

Post by zby »

Early stage is just not very well suited for dispersed ownership. The investors need to do a lot of work to dig up and verify the information and this only makes sense if they have big stakes in the company. This is a general problem with crowdfunding (https://medium.com/@zby/proof-of-work-8d8265def194). Then there are specific problems with ICOs - which have no legal meaning and give no guarantee to the investors at all.

Re: Hundreds of Bitcoin Wannabes Show Hallmarks of Fraud

#64

Post by hudon »

ryanlol wrote: post #48
hudon wrote: post #43

Earlier quoted context omitted.

While it has speculative value [0], you can use it to buy stuff, but while doing so you will spend on exchange fees to convert in and out of crypto, you will use as much electricity for your transaction as 33 US households use in a day, you will subject yourself to liquidity risk and volatility risk [1] and you will have to wait for anywhere from ten minutes to a couple hours [2]. Calling this complicated, risky and…

It’s like you’ve never dealt with chargebacks.

Chargebacks protect users from fraudsters, which is exactly what the featured article is saying is a major problem in the cryptocurrency space. Millions of people getting scammed with no legal recourse is a problem. Retailers dealing with chargebacks less so... I've never heard of the "Merchants are thinking of no longer selling anything due to chargebacks" problem.

Re: Hundreds of Bitcoin Wannabes Show Hallmarks of Fraud

#65

Post by whataretensors »

justherefortart wrote: post #55
whataretensors wrote: post #51

Earlier quoted context omitted.

OP is proof that intelligent people aren't always creative or future looking.

You can be open to things but also be skeptical. I got a degree in finance in college (in addition to MIS/Economics) because of all the scandals of my youth. I wanted to see if I could avoid those issues. Being a software engineer it's actually pretty easy, being a business owner you're certainly riding the tides that are our joke of a financial regulatory system (up to the highest bidder to make the laws/regulations…

Yes skepticism is healthy, and I'm wrong to assume ops abilities.

It seems obvious that dapps can decentralize supplier/consumer relationships, removing the 30% that perhaps ops job relies on.

Re: Hundreds of Bitcoin Wannabes Show Hallmarks of Fraud

#66

Post by sandworm101 »

lawn wrote: post #46
lotyrin wrote: post #22

Earlier quoted context omitted.

Do you have counter examples? Anything using the currencies as stores of wealth or mediums of exchange seem to be better suited by traditional finance which are less volatile and capable of higher volume. Anything using the ledger as a distributed datastore seems like it would be better suited by a datastore that wasn't wrapped up in a currency ledger and uses a consensus algorithm less costly than proof-of-work.

Examples of what cryptocurrencies does better: * Donations to wikileaks. Paypal froze their account and there are tons of examples where they have done this without good cause. * Legal businesses like marijuana sellers, porn, escort services and gambling platforms have had trouble using and keeping payment services. Some have been forced to only accept cash payments as they couldn't accept credit cards. * A way to ac…

If you think taking money for products via credit cards is difficult or expensive, you've got some surprises should you try to sell via cryptocurrencies.

Security is a huge deal. Want to get hacked? Tell people you accept bitcoin payments. Put an interface on your website. Remember to bolt your server down to the floor with big long bolts. And the backup server. And the other backup. And all the little thumbdrives. Cash is far easier to secure.

Think credit cards are difficult, try negotiating with a customer wanting a refund in bitcoins. Exactly how much bitcoin do they get today in exchange for a purchase made last week?

Nobody outside onionland handles commercially-significant crypto transactions. There are reasons.

Re: Hundreds of Bitcoin Wannabes Show Hallmarks of Fraud

#67

Post by brothercolor »

wufufufu wrote: post #10

Can someone smarter than me try to write a formal proof that you can only have 2 of the following: distributed, fast, secure?

Related: Bitcoin is [x] distributed [x] secure but NOT [] fast. It is a global clock that self-adjusts to tick roughly every 10 minutes, and that tick is used to extend an immutable ledger by adding verified transactions to it. The tick-time is chosen to allow for global propagation to happen. Incidentally this global clock can be used for other things than sending money, such as cryptographically tying something in the real world to a point in time.

Re: Hundreds of Bitcoin Wannabes Show Hallmarks of Fraud

#68

Post by ryanlol »

hudon wrote: post #64
ryanlol wrote: post #48

Earlier quoted context omitted.

It’s like you’ve never dealt with chargebacks.

Chargebacks protect users from fraudsters, which is exactly what the featured article is saying is a major problem in the cryptocurrency space. Millions of people getting scammed with no legal recourse is a problem. Retailers dealing with chargebacks less so... I've never heard of the "Merchants are thinking of no longer selling anything due to chargebacks" problem.

Either I ask customers to send me loads of PII, or I ask them to make their first payments in bitcoin.

I’ll always choose the latter.

Re: Hundreds of Bitcoin Wannabes Show Hallmarks of Fraud

#69

Post by yks »

econochoice wrote: post #12
hudon wrote: post #6

- The space is littered with fraud. - Wallets have bugs that lose hundreds of millions of dollars - Energy consumption forecasted to hit 0.5% of the world’s electricity consumption by end of 2018 - Promoters yelling “decentralize everything” while exchanges, development teams and mining are all highly centralized - No legal use case found to date Blockchain is a parasite on society.

Despite all of this, I don't think we've hit peak blockchain fetishism yet. There's still a lot of room to make solved problems worse with a blockchain.

There is a lot of social capital to acquire by making solved problems worse (e.g. "reddit redesign") so blockchain will probably see much wider adoption soon.

On the bright side, there will be a lot of social capital to acquire by "fixing blockchain" with revolutionary "centralised databases" afterwards :)

Re: Hundreds of Bitcoin Wannabes Show Hallmarks of Fraud

#70

Post by lawn »

lotyrin wrote: post #58
lawn wrote: post #46

Earlier quoted context omitted.

Examples of what cryptocurrencies does better: * Donations to wikileaks. Paypal froze their account and there are tons of examples where they have done this without good cause. * Legal businesses like marijuana sellers, porn, escort services and gambling platforms have had trouble using and keeping payment services. Some have been forced to only accept cash payments as they couldn't accept credit cards. * A way to ac…

Places crypto has been used isn't evidence that it was the only thing possible to have been used, which is the question -- what does PoW-consensus blockchain ledger make possible that isn't possible without it? It's not a matter of what they've been better than status-quo broken finance systems. The question is "if we replace these broken systems with something, why does it have to be a blockchain using PoW for conse…

> what does PoW-consensus blockchain ledger make possible that isn't possible without it?

Preventing double spends in a decentralized manner without a trusted third party. No other form of digital currency can do that.

There is a possibility that PoW can be replaced with some form of PoS (proof of stake) but it's not certain if it works well enough. Note that I consider both PoW and PoS backed ledgers cryptocurrencies.

> It's not a matter of what they've been better than status-quo broken finance systems.

They're better than everything at the examples I listed.

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