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How Blockchain Works

blockchain.mit.edu

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Re: How Blockchain Works

#171

Post by sparkzilla »

Moodles wrote: post #152
sparkzilla wrote: post #140

Earlier quoted context omitted.

The amount of verification required depends on the data. Simple data, such as sports results -- coming from high-quality sources doesn't require much verification, and can be automated. More complex data requires human verification, but that will gradually be replaced by distributed machine learning.

If an article says Trump gave a speech, how do you verify with machine learning, using a blockchain, that Trump literally gave a speech? I don’t really understand your business. It’s a business, but also dencentralised. Are you trying to verify if news is fake or not? Why do you need a blockchain or machine learning for this? Do you have your own coin?

>If an article says Trump gave a speech, how do you verify with machine learning, using a blockchain, that Trump literally gave a speech?

To do fact checking you first need to know what has been reported. We verify that a source reported that Trump was involved in a news event where he gave a speech, and convert that to data (For example: Trump, gives speech, text of what he said, location etc, with links to the sources). Anyone can then use that data combined with their own algorithms or external data to evaluate the quality of the data -- primarily by evaluating the sources -- to create quality scores for that news event.

> don’t really understand your business. It’s a business, but also dencentralized.

We are setting up a foundation to oversee the blockchain, but it really only exists to distribute the initial funds and to provide initial guidance, until on-chain governance can be set up. Companies and individuals run the apps that use the data on the blockchain.

>Are you trying to verify if news is fake or not?

See above. You can use the data for lots of things. Detecting fake news is just one application.

>Why do you need a blockchain or machine learning for this?

There is no way to ensure that the data is verified independently across the network, and stored in a censorship and tamper-resistant way without a blockchain.

>Do you have your own coin?

The coin (NewsBlocks Tokens) will be used by apps to pay for the data. The payments are then sent to the people who added the data, without any need for middlemen or news agencies, using Smart Contracts.

Re: How Blockchain Works

#172

Post by vec »

thedancollins wrote: post #167
vec wrote: post #151

Earlier quoted context omitted.

> Yes, you have paper money in your possession that is only worth as much as a centralized bank SAYS it is... Do you really want to bring volatility into this? Because in the real world fiats are orders of magnitude more stable than cryptos. Besides, that's tangential to why people prefer banks to cash. If the Federal Reserve screws up and tanks the dollar I'm just as screwed regardless of whether my money's in a dol…

>Because in the real world fiats are orders of magnitude more stable than cryptos. Yes, but if you'll allow me a little latitude - the fiat currency is under centralized control. And in that case is remarkably stable - until it is not. And 2008 happens. Blockchain is decentralized and yes, volatile. But fiat currency is FALSELY stable - it is engineered to be stable by a centralized authority that does not understand…

> is remarkably stable - until it is not

I think we're saying mostly the same thing, just with slightly different framing.

We have one mechanism for maintaining a stable store of value (centrally managed fiat) that in practice seems to work well most of the time but periodically experiences catastrophic failures. We have another mechanism for maintaining a stable store of value (crypto markets) where catastrophic failure appears to be standard operating procedure. The first is far from ideal, for all the reasons you mention and many more, but from where I'm sitting it still seems like the lesser of two evils.

Also worth noting that central banks predate fiat currency. Back when currencies were metal-backed governments would hoard or release metal to try and control the market value. That's what Fort Knox is for. It didn't work as well as in fiat-world, because there are bounds to how much metal you can actually manage to store, but it worked well enough. It'll still work well enough when the Fed has a Strategic Bitcoin Reserve that they can manipulate the market with.

> the smart contract would likely require its own level of background on any given ID

Oh, yeah, no halfway competent vendor is going to allow themselves to get scammed like this. And the technical solutions are pretty obvious. My whole point, though, is that we're almost immediately reinventing credit requirements for market participation.

-----

There are a lot of people making starry eyed predictions for exciting new developments that a crypto-based economy would allow to happen, but when you dig into the details the vast majority of those things are just as feasible under a halfway decent centrally-managed ACH system. There are also a lot of people joyously awaiting the collapse of large sectors of the financial system, but again when you dig into the details most of those sectors exist to solve problems and meet needs that are still present on a blockchain.

We've been through half a dozen currency transitions over the past few centuries. From precious metal coins to private scrip backed by precious metal to government scrip backed by precious metal to government scrip backed by fiat to paper transaction logging (checks) to electronic transaction logging (ACH), and the financial sector has not only survived but embraced the infrastructure shift every time.

Don't get me wrong, I've got my fair share of complaints about the modern financial system. But for good or ill I just don't see a fiat to crypto transition having anything close the apocalyptic effects that HN, collectively, seems to expect.

Re: How Blockchain Works

#173

Post by lawn »

thedancollins wrote: post #165
lawn wrote: post #161

Earlier quoted context omitted.

I'm saying it's already viable and as such handles the scale we have today. Complains like "but it can't scale to all of the payments in the world" is severely missing the point. Also we can already achieve PayPal like transaction amounts today, with Bitcoin Cash having in practice 20% of throughput. The limiting factor to scale further is software limited, not hardware. Furthermore it's possible to reach VISA levels…

Ah, point taken! One of the obvious courses is that there wiull be multiple blockchains each handling various arenas. In that case we run into the interesting blockchain-of-blockchains problems where we have to engineer not only under one blockchain but we have to figure out how to overcome the "slowest node" problem. Truly an engineering feat waiting for a hero (or heroine). Thoughts?

Yes among all clones and copies there are several "real" attempts at solving various problems.

As I mentioned Bitcoin Cash tries to see how far we can go with on-chain scaling.

Bitcoin on the other hand mostly avoids on-chain scaling and wants to add on side-chains which are supposed to scale. They're basically a second blockchain but it works a bit differently with different security trade-offs and comes with easy on and off settlements.

Monero wants to make all transactions private and thus make the coin itself fungible. The trade-off is that it's much harder to scale than the transparent blockchain of Bitcoin.

Ethereum wants to explore the idea of having advanced smart contracts on chain and again have several hard problems ahead.

Which approach is the best? Who knows...? Maybe in the end we'll have one coin that integrates all breakthroughs or they will each tend to their own niche. Overall I'm quite hopeful (obviously).

Now surrounding all this we need a lot of plumbing services. Payment processors which can accept the different coins and exchanges that makes it easy to swap between different coins.

I'm not sure if that answers your question though!

Re: How Blockchain Works

#174

Post by thedancollins »

vec wrote: post #172
thedancollins wrote: post #167

Earlier quoted context omitted.

>Because in the real world fiats are orders of magnitude more stable than cryptos. Yes, but if you'll allow me a little latitude - the fiat currency is under centralized control. And in that case is remarkably stable - until it is not. And 2008 happens. Blockchain is decentralized and yes, volatile. But fiat currency is FALSELY stable - it is engineered to be stable by a centralized authority that does not understand…

> is remarkably stable - until it is not I think we're saying mostly the same thing, just with slightly different framing. We have one mechanism for maintaining a stable store of value (centrally managed fiat) that in practice seems to work well most of the time but periodically experiences catastrophic failures. We have another mechanism for maintaining a stable store of value (crypto markets) where catastrophic fai…

Sorry it took me so long to get back to you. Yes, the breathless proclamations of blockchain Armageddon (or Paradise) are tiring. I agree. And it is part of my souring on the whole topic. There is potential for something like blockchain to make a radical impact. But you know how it is - freedom is wonderful but it comes at the cost of diligence. And banks are just so freaking comfy. And they seem to demand so little of us.

The idea of the government creating a Strategic Bitcoin Reserve is interesting. You are right, whatever the current players can do to control any new financial instruments they will. I suppose the libertarian response to such an action on such a chain would be to abandon the chain. And I am WAY out over my skis here but there is a drastic difference between the money printing that is happening in America as opposed to the American govt attaching its keys to a large amount of a cryptocurrency. If they did that and did not transact with that coin then they could have a marked impact on the coin's liquidity and that would affect its value. It could also impact the transactability as fewer and fewer people would be active on that blockchain. But I keep coming back to the true difference being transparency and not being under centralized control as being the POTENTIAL game changers. I am not sure the populace has the stomach for such responsibility. Heck, I am not sure I do.

Re: How Blockchain Works

#175

Post by aklemm »

jondubois wrote: post #163
aklemm wrote: post #159

Earlier quoted context omitted.

But if those cryptocurrencies keep never amounting to anything, then the bribing won't keep working, right?

It will but maybe it will be harder to do it. It's like if you could give some shares of your startup to a journalist in exchange for writing an article about your startup. Cryptocurrency can act like shares without central authority. If enough software services rely on a specific cryptocurrency as payment, then it has actual intrinsic value

"If enough software services rely on a specific cryptocurrency as payment, then it has actual intrinsic value"

I wish I'd seen this earlier. Pretty sure this is false, but it is an excellent summation of the thought behind what's run up digital currencies.

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