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There's No Good Reason to Trust Blockchain Technology

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Re: There's No Good Reason to Trust Blockchain Technology

#141

Post by unnouinceput »

tcrow wrote: post #63

The author has demonstrated a very amateurish understanding and greatly conflated Bitcoin technology with blockchain technology in general, drawing the reader to make the same poor conclusions as the author. Just a quick example > "The second element is the consensus algorithm, which is a way to ensure all the copies of the ledger are the same. This is generally called mining;" - except that is only applicable for (p…

Except the author is Bruce Schneier, world top security guru, if not arguably the most influential of it. And also your "quick" example talks about stuff outside or in the future to happen, while the article is based on current state of bitcoin in particular. Between believing Bruce and you guess who I'm going to trust in.

Re: There's No Good Reason to Trust Blockchain Technology

#142

Post by fdggdfsvscvsd »

astrodust wrote: post #116
fdggdfsvscvsd wrote: post #89

Earlier quoted context omitted.

The value of Bitcoin is not something Bitcoin makes any promises about. The technology is obviously not a scam. At most it could turn out that it has technical flaws, like the crypto algorithms could be broken or whatever. People selling you Bitcoin or making you promises about Bitoin might well be scammers. But that's not the same thing. Worthless fiat money: it seems to happen a lot, actually. I have a couple of Bi…

When the Bitcoin network goes offline then every BTC in existence will be worth exactly $0.0000. When Zimbabwe blew up their money the bills themselves still had marginal utility as wallpaper or as collectibles. Collectively these bills are probably worth millions because there were so many of them. If you have any Reichmarks around they're actually worth a fair bit considering they're not legal tender. Bills on eBay…

I doubt Zimbabwe Dollar paper is worth millions, but OK...

I'll check the value of the Reichsmark, but again, I suspect the market is limited.

Network going down: in theory you could keep it up with a Raspberry Pie, so I suppose somebody will. Although I don't know if all the mining hardware out there would make it nonviable (as anybody could start a mining attack with such mining hardware, against a Pie).

As for proving Bitcoin isn't a scam: we don't need the inventor or their plans, we have the implementations of it. That can be validated, as much as possible. I'd argue that if it still has flaws, then they weren't because of scamming, but because of technical issues nobody could foresee.

Edit: they seem to be selling notes of one billion Reichsmark for 1€ on ebay (here in Germany). Not really worth the effort.

Re: There's No Good Reason to Trust Blockchain Technology

#143

Post by blotter_paper »

dragontamer wrote: post #133
blotter_paper wrote: post #131

Earlier quoted context omitted.

USD inflated 2.44% last year. Satoshi can dump his alleged 5% of the total supply once, and then he can't do it again. The fed can keep inflating at whatever rate they want year after year. That's the difference, and it's huge. The fed's power approaches infinity, but Satoshi's does not. Gold doesn't become inflationary just because the pope owns a lot of it.

There were 5-Million BTC in 2011, and there are now over 15-million BTC today. BTC has inflated 300% in the past 7ish years. There will be 657,000 BTC added to the system in the next year, or roughly 4.5%. Which means BTC is "inflating" more than USD right now (with your definition of 'inflation', which isn't very good IMO). The next halfening won't happen until 2020 or so.

That's not my definition you're using! I wouldn't count a hypothetical Satoshi dump as inflation, nor do I count new coins mined as inflation. Again, think of Bitcoin as analogous to gold (and ignore the fact that we can technically make prohibitively expense gold now, as economists of the past were not considering modern alchemy when defining inflation). We don't claim that gold has inflated when more is mined, because it is understood that the gold mined already existed. The fact that there was hard-to-get gold underground has already been accounted for in the market valuation of gold. The fixed total number of bitcoins is what makes Bitcoin deflationary, even though more bitcoins are becoming available in the short term; the market knows this, and has theoretically accounted for it. This is more true of Bitcoin than the classic example of gold, as our gold estimates are just that and our Bitcoin estimates are perfect (barring breakdown of the network). Yes, the market is irrational and hasn't _really_ accounted for it, but don't tell the economists that! This is covered in intro macroeconomics, a currency/commodity isn't considered inflationary just because more becomes _available_, it's about whether or not there is a known finite supply. I'm not pulling this out of nowhere. Ask any economist if Bitcoin is deflationary.

Re: There's No Good Reason to Trust Blockchain Technology

#144

Post by fdggdfsvscvsd »

dkonofalski wrote: post #114
fdggdfsvscvsd wrote: post #106

Earlier quoted context omitted.

What do you mean by "farms that potentially devalue the currency every single second"?

Any currency is only as valuable as the goods or services that they can be exchanged for. The value of money comes from its inherent scarcity as, in the case of fiat currency, only a government or federal agency can issue more of it. With Bitcoin, farms are generating more of the currency all the time. If I generate a ton of Bitcoin but never spend it or use it in exchange for goods and services, I'm simply devaluing…

If you mine a Bitcoin and don't spend it, you are making the remaining Bitcoins more valuable (in theory). You have reduced the overall supply.

With Bitcoin, the maximum number of Bitcoins that will ever exist is fixed.

It doesn't really matter who mines them. Of course at the moment, indeed, new Bitcoins are mined all the time, but the timeline for the future is clear.

Whether it is a good thing, I don't know. There are a lot of weird aspects about it.

As for China - sure, some miners will accumulate a lot of BTC. But they can only affect the price by selling or not selling it. If they wouldn't mine the BTC, somebody else would. It doesn't really give them that much more power, except for monetary power.

It's probably true that right now there are several people or entities who could crash the Bitcoin price by simply selling off all their BTC. That's not very reassuring.

On the other hand, such a crash could also be a chance to distribute BTC more evenly. It would actually be in the interest of the rich BTC people, too, as it would lead to more adaption and hence more value and stability.

Distribution is a hard problem.

There are several problems with crypto, but they are also interesting, and smart people are trying to solve them. At least it is fun, even if it is unclear if it will be worthwhile in the end.

Re: There's No Good Reason to Trust Blockchain Technology

#145

Post by fdggdfsvscvsd »

astrodust wrote: post #119
fdggdfsvscvsd wrote: post #79

Earlier quoted context omitted.

That seems rather silly. I am not going to hound you about your dislike of Bitcoin people. You are ENTITLED to dislike them. I just note that you have no idea what you are talking about and therefore discount your opinion accordingly.

The people who are the most enthusiastic about cryptocurrency are typically the least informed. "You know nothing, your opinion is invalid" is a classic "crypto" talking point. "You don't understand Bitcoin," they shriek while failing to comprehend the precarious position their beloved asset is in. "Bitcoin can't have bubbles, it's mathematically impossible," yell their cheerleaders.

All the OP said is "I don't like Bitcoin people", without giving any reasons (even saying he can't give reasons). Why should people assume he made an informed decision, based on merely that? Also, many comments really show that people don't properly understand it - can you blame people for noticing and dismissing those comments?

And I question your claim about enthusiastic people being the least informed. I'd say the people who work on it and dedicate their lives to improving the infrastructure are both enthusiastic and informed. Of course there are also enthusiastic people who are misinformed.

Re: There's No Good Reason to Trust Blockchain Technology

#146

Post by legionof7 »

XMPPwocky wrote: post #59
legionof7 wrote: post #44

Earlier quoted context omitted.

You are correct with borrowing, I'm not sure what that's about, happy to be enlightened by OP though. Not sure about investments, haven't done too much research into the benefits of ICOs and letting more people invest. I think corporations are a good point though. If more companies became DAOs, we'd have much better checks and balances and transparency for corporations.

> If more companies became DAOs, we'd have much better checks and balances and transparency for corporations. Why on earth would any corporation ever want to become a DAO? The transparency benefit there is roughly that a DAO must, by design, not be able to keep any secrets, since it's incapable of having nonpublic state. Similarly, the "checks and balances" benefit seems to be just "more literal enforcement of contra…

More crowdwisdom. Also stops corporations from acting unethically. Consumers will have to start preferring DAOs over regular companies for DAOs to become mainstream unless crowdwisdom has a huge impact.

Re: There's No Good Reason to Trust Blockchain Technology

#147

Post by sudomakeup »

amluto wrote: post #80
tcrow wrote: post #63

The author has demonstrated a very amateurish understanding and greatly conflated Bitcoin technology with blockchain technology in general, drawing the reader to make the same poor conclusions as the author. Just a quick example > "The second element is the consensus algorithm, which is a way to ensure all the copies of the ledger are the same. This is generally called mining;" - except that is only applicable for (p…

> except that is only applicable for (proof of work POW) consensus and does not apply to proof of stake (POS) and delegated proof of stack (DPOS) which several of the top blockchain projects are currently using (even Ethereum is moving to POS). For POS, you have to trust the rich people and you have to trust that the disincentives to cheating actually work the way they’re supposed to. Neither of these have very compe…

For (m)ETH, proof of stake has been "just around the corner" for years.

Re: There's No Good Reason to Trust Blockchain Technology

#148

Post by knolax »

astrodust wrote: post #74
fdggdfsvscvsd wrote: post #49

Earlier quoted context omitted.

Did you ever go to such a meetup? What exactly annoyed you about the people?

Questions like this. Don't sea lion. http://wondermark.com/1k62/

That comic just seems like a lazy way of dismissing people by assuming bad faith.

Re: There's No Good Reason to Trust Blockchain Technology

#149

Post by tcrow »

unnouinceput wrote: post #141
tcrow wrote: post #63

The author has demonstrated a very amateurish understanding and greatly conflated Bitcoin technology with blockchain technology in general, drawing the reader to make the same poor conclusions as the author. Just a quick example > "The second element is the consensus algorithm, which is a way to ensure all the copies of the ledger are the same. This is generally called mining;" - except that is only applicable for (p…

Except the author is Bruce Schneier, world top security guru, if not arguably the most influential of it. And also your "quick" example talks about stuff outside or in the future to happen, while the article is based on current state of bitcoin in particular. Between believing Bruce and you guess who I'm going to trust in.

You obviously didn't read my other comments here if you think this is "future" stuff and not already working in real-world scenarios. Also the title does not say anything about Bitcoin, it uses the term Blockchain technology. For someone who is so professional and partial to the space, I WOULD ABSOLUTELY EXPECT a title and terminology to reflect the actual content and not to so casually and carelessly lob all Blockchain tech in with this analysis. It's really unfortunate because those out there who understand so little of what is actually going on will believe what these "analysts" tell you.

Re: There's No Good Reason to Trust Blockchain Technology

#150

Post by [deleted] »

verdverm wrote: post #113
mantenpanther wrote: post #86

Earlier quoted context omitted.

Good spot here, h#$@ is a 4 letter word, starts with 'h' and you used it in a discussion in the context of the term 'hate'. Not sure if this setup was to easy, or you taking your bet too serious scanning the interwebs for such opportunities :-)

I wasn't looking for it, but we did talk about how the internet would be a great place to spread the idea. We don't go around preaching, rather bring it up when someone uses the "H-word." It's far more interesting IRL because it almost always sparks an inspiring conversation.

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