You Do Not Need Blockchain: Popular Use Cases and Why They Do Not Work • Hacker News Board

Re: You Do Not Need Blockchain: Popular Use Cases and Why They Do Not Work

#341

Post by trevelyan » Sat, Feb 23, 2019, 2:44 AM UTC

gregschlom wrote: post #33

I've said this several times before on this site but will keep repeating it: there's exactly one use case where the blockchain is a superior (and, in fact, the only) solution: when you can't use contracts and the legal system to ensure trust between the parties. In other words, anything illegal. For any other conceivable use case, a database and a contract between parties are a superior solution. Edit: To clarify wha…

You're making the mistake of thinking that blockchains are databases. Also of imagining that blockchain applications require smart contracts (you can run applications on a distributed network simply by affixing data to transactions, check out Saito for an example of how this is done).

The blockchain is a self-sustaining PKI network. It eliminates MITM attacks and facilitates the use of PKI technology by making it trivial for nodes to read/write/verify information that is sent over the network. On the economic layer, the fact that it pays its own way eliminates the ability for network operators to create information-layer monopolies (i.e. App Store).

If you think about blockchain as a database, you'll be stuck thinking about the use cases that involve a database. If you think about blockchain as smart contracts, you'll be stuck comparing them to real world contracts. Start thinking of decentralized app stores (which cannot impose constraints on the revenue models of their hosted apps) or advertising networks which let users put advertisements on any webpage. There are tons of reasons to pay a small fee to send information across a secure and tamper-proof network.

Re: You Do Not Need Blockchain: Popular Use Cases and Why They Do Not Work

#342

Post by AnthonyMouse » Sat, Feb 23, 2019, 2:54 AM UTC

perl4ever wrote: post #332

AnthonyMouse wrote: post #137

Earlier quoted context omitted.

> In other words, anything illegal. Not exactly. It's anything for which the legal system is not effective. For example, you can have a perfectly legal contract, but the other party is in a corrupt foreign jurisdiction that would never find in your favor in the event of a breach. Then you can't contract with them because they have no incentive not to breach, without an alternative method of ensuring compliance that d…

"What you're arguing is that a perfect system of government removes the need for any alternative. But we haven't got a perfect system of government." Yeah, but maybe something like bitcoin is a cancer on an imperfect system. If you asked a tumor, maybe it would say, well, the infrastructure of the body I'm living in sucks! There are all these use cases that the immune system and the circulatory system and so on don't…

If you like a cancer analogy, blame the cigarettes, not the tumor.

People wouldn't be so interested in Bitcoin if the existing financial system didn't fail so many people. You don't get the cancer without the defects that cause it.

It shouldn't be possible to deny someone the ability to send or receive money. It sounds like a good idea (down with the bad guys), until you also push for a cashless society, at which point it's equivalent to demanding that they starve to death under a bridge because they have no way to buy food or pay rent. That's how to turn people at the margin into violent criminals.

It should be possible to electronically spend $100 anonymously. It isn't anybody's business what kind of books you want to read, or whether you want to donate to the EFF or your church or Planned Parenthood. Your sex life should be between you and your partner, not you, your partner, Paypal, Mastercard and Bank of America.

The existing system gets things like this wrong, which drives people to alternatives. If you don't like the alternatives, remove the demand for them by satisfying it within the existing system.

Re: You Do Not Need Blockchain: Popular Use Cases and Why They Do Not Work

#343

Post by pessimizer » Sat, Feb 23, 2019, 3:12 AM UTC

oarabbus_ wrote: post #156

gregschlom wrote: post #80

Earlier quoted context omitted.

I'm not saying: you don't need the blockchain because you shouldn't be doing bad things. I'm saying: you need the blockchain if and only if you are doing things that are illegal in your country. It's a decision criteria for when you need the blockchain. I'm making no moral judgement. And there are very good reasons to want to do things that your government deems illegal (for example, donating to a political organizat…

>I'm saying: you need the blockchain if and only if you are doing things that are illegal in your country. It's a decision criteria for when you need the blockchain. This is, at face value, simply false. I want to send $5 to a poor African family. I'll even relax my criteria - I'm willing to wait _up to 3 business days_ for this African family to receive my $5. I live in California. Could you please point me towards…

If you live in a medium sized city, probably within the hour and within walking distance of your house, an African person walked into a store covered in colorful signs advertising phone cards, cheap plane fares and bus tickets, and sent half of their week's paycheck to their family somewhere in Africa.

This is not only not a mystery, but common, and individual remittances from emigrant relatives are a major consideration in the economies of some underdeveloped countries.

Re: You Do Not Need Blockchain: Popular Use Cases and Why They Do Not Work

#344

Post by Mirioron » Sat, Feb 23, 2019, 3:22 AM UTC

turtlesdown wrote: post #211

AnthonyMouse wrote: post #137

Earlier quoted context omitted.

> In other words, anything illegal. Not exactly. It's anything for which the legal system is not effective. For example, you can have a perfectly legal contract, but the other party is in a corrupt foreign jurisdiction that would never find in your favor in the event of a breach. Then you can't contract with them because they have no incentive not to breach, without an alternative method of ensuring compliance that d…

> For example, you can have a perfectly legal contract, but the other party is in a corrupt foreign jurisdiction that would never find in your favor in the event of a breach. Then you can't contract with them because they have no incentive not to breach, without an alternative method of ensuring compliance that doesn't rely on their corrupt government. International trade has perfectly good mechanisms for dealing wit…

>International trade has perfectly good mechanisms for dealing with this at present. See: Letters of Credit.

This works until you deal with a subject matter that (some) banks don't like or with people that (some) financial institutions don't like. It's entirely possible to be banned from Visa and MasterCard's services and this can sometimes mean that banks simply won't do business with you. Sometimes it's the subject matter you're dealing with that can be banned, eg certain types of (legal) porn.

>Probably still illegal to do business with you if the government has outlawed work with specific sanctioned countries, etc. Also, letters of credit.

He didn't say that the government has outlawed doing business with the country. He said that the government treats people from that country much more harshly. This would mean that businesses wouldn't want to do business with people from that country. Letters of credit don't work if the other country's banks aren't interested in dealing with businesses from your country.

Re: You Do Not Need Blockchain: Popular Use Cases and Why They Do Not Work

#345

Post by Mirioron » Sat, Feb 23, 2019, 3:25 AM UTC

dragontamer wrote: post #146

josaka wrote: post #123

Earlier quoted context omitted.

My sense is the set of scenarios where "you can't use contracts and the legal system to ensure trust between the parties" is broader than just illegal agreements. Contract often fail when the damages for breach are too small, diffuse, and heterogeneous, making class action unsuitable. And many contract provisions are often not honored in bankruptcy. Litigation is an unwieldy tool and preferably avoided where possible…

But that's where small-claims court comes in. It mostly only costs you your time, you aren't really allowed to bring in a lawyer to argue on your behalf, etc. etc. Depending on your location, the MAXIMUM damages for small-claims court is $5000 to $10,000. The whole system is designed so that smaller issues can be resolved quickly. > And many contract provisions are often not honored in bankruptcy That's literally the…

>But that's where small-claims court comes in. It mostly only costs you your time, you aren't really allowed to bring in a lawyer to argue on your behalf, etc. etc.

This is such a US-centric answer it hurts. Small claims court doesn't mean anything when the other entity isn't even in your country. If you and I make a contract and you flake on it then I have no reasonable legal recourse because an international lawsuit is way too expensive for me.

Re: You Do Not Need Blockchain: Popular Use Cases and Why They Do Not Work

#346

Post by Mirioron » Sat, Feb 23, 2019, 3:33 AM UTC

gregschlom wrote: post #157

skilgarriff wrote: post #106

Earlier quoted context omitted.

I can send 1 bitcoin from myself living in Minnesota to my friend living in Japan for the equivalent of $0.46. That's an improvement over the existing system. I don't have to trust anyone in between to get my money to him. How would that be as possible and as "trustless" without blockchain?

1. Regarding the fees: $0.46 is (I presume) only the transaction fees. To make an accurate comparison, you'd have to include the exchange fees to convert from USD to BTC and then from BTC to JPY. Right now Coinbase is charging me $59 to buy 1 BTC, and I don't know how much more it would be to sell exchange that back to JPY. You can send $4000 (about 1 BTC) to someone in Japan for $30.14 with TransferWise. And guess w…

>You can send $4000 (about 1 BTC) to someone in Japan for $30.14 with TransferWise.

Doesn't TransferWise rely on MasterCard? In other words, if MasterCard bans you then you wouldn't be able to send it.

Re: You Do Not Need Blockchain: Popular Use Cases and Why They Do Not Work

#347

Post by AnthonyMouse » Sat, Feb 23, 2019, 3:38 AM UTC

turtlesdown wrote: post #313

AnthonyMouse wrote: post #223

Earlier quoted context omitted.

Your workarounds have potentially higher overhead. "Just factor in additional costs" is equivalent to destroying otherwise-productive low margin transactions. Even for higher margin transactions, higher overhead is no advantage. > Probably still illegal to do business with you if the government has outlawed work with specific sanctioned countries, etc. The whole point is the cases where it's not. Many banks and payme…

> The whole point is the cases where it's not. So your argument is that blockchain is only useful for international trade with tiny businesses? > Even for higher margin transactions, higher overhead is no advantage. Most people consider low corruption, high rule of law countries ideal places for business, with the higher overhead...

> So your argument is that blockchain is only useful for international trade with tiny businesses?

That is one use, not the only use. And don't discount the scope of international transactions with individuals.

> Most people consider low corruption, high rule of law countries ideal places for business, with the higher overhead...

When the overhead comes with something worth more than it costs you. Sometimes it doesn't.

Re: You Do Not Need Blockchain: Popular Use Cases and Why They Do Not Work

#348

Post by Mirioron » Sat, Feb 23, 2019, 3:44 AM UTC

ddebernardy wrote: post #193

greglindahl wrote: post #153

Earlier quoted context omitted.

You don't "need" to offer these guarantees. Personally, I'm happy with paper ballots.

Me too. In large part because paper ballots offer these guarantees. But there's a swath of elections and voting going on (in universities, within political parties or unions, etc., but also official elections in parts of the US or in Estonia) that that use e-voting to cut costs or improve participation. They currently lack these guarantees yet those elected end up in charge of millions in budget.

In Estonia you verify your vote if you voted online. You can do so up to 3 times and only within 30 minutes of voting.

E-voting is done on a PC. After you've finished voting a QR code pops up. You can scan that QR code with your voting verification app on your phone and it'll send you the results.

Here's how the system works: https://www.valimised.ee/en/internet-voting/principles-check...

Re: You Do Not Need Blockchain: Popular Use Cases and Why They Do Not Work

#349

Post by shrimpx » Sat, Feb 23, 2019, 3:46 AM UTC

jVinc wrote: post #84

AlunAlun wrote: post #37

Earlier quoted context omitted.

You can repeat it all the times you want, but it it is still a shortsighted view. “A database and a contract”... but who owns the database? And who enforces the contract? And who owns the actual data? Blockchain provides satisfactory answers to all those problems. I agree 100% with the article in that blockchain is being ‘applied’ to a whole bunch of places that don’t need it. That doesn’t mean that it can’t work wel…

> but who owns the database? And who enforces the contract? And who owns the actual data? > Blockchain provides satisfactory answers to all those problems. What problems? I mean your arguing like something like public transportation is an impossibility without blockchain backing because: "Who owns the stations, who enforces the schedules and who owns the actual busses?" Those are not problems. They are all just quest…

We are talking about ownership, which of course doesn't matter in your example because you don't own the buses or the stations.

If you own a house, where's the record? The title is with an insurance company. Why? Because your ownership of this house can be questioned at any time since there's no equivocal record. It's recorded in a bunch of "databases", some of which you and your insurance company may not know exist.

Re: You Do Not Need Blockchain: Popular Use Cases and Why They Do Not Work

#350

Post by shrimpx » Sat, Feb 23, 2019, 3:49 AM UTC

gregschlom wrote: post #33

I've said this several times before on this site but will keep repeating it: there's exactly one use case where the blockchain is a superior (and, in fact, the only) solution: when you can't use contracts and the legal system to ensure trust between the parties. In other words, anything illegal. For any other conceivable use case, a database and a contract between parties are a superior solution. Edit: To clarify wha…

That's not true. Pretty much everything you own is "yours" subject to various machinery that can be tampered with by the parties who control it. Blockchain can make ownership records unequivocal.