Facebook plans cryptocurrency debut • Hacker News Board

Re: Facebook plans cryptocurrency debut

#271

Post by olalonde » Fri, Jun 07, 2019, 8:57 PM UTC

wz1000 wrote: post #6

Can anyone explain what the point of a pegged cryptocurrency is? Since you are dependent on the issuing entity to honour the stated peg, why not just have your balance be an entry in a regular database maintained by that entity? What exactly does the blockchain gain you here? One thing it does _not_ get you is censorship resistance. If the central authority wants to take away coins from a wallet, all it needs to do i…

Funny how 90% of the commenters seem to totally miss parent's point. We get why a pegged digital currency is useful, just not why it has to be a "blockchain".

A pegged "cryptocurrency" can just be designed as a centralized service (e.g. a REST API backed by a traditional database) without losing any of its properties. The "crypto" and "blockchain" bits are marketing.

A good rule of thumb is this: could someone have come up with this pre-Bitcoin? If the answer is yes, it's not a (decentralized) cryptocurrency.

Re: Facebook plans cryptocurrency debut

#272

Post by baby » Fri, Jun 07, 2019, 8:58 PM UTC

A2017U1 wrote: post #38

alehul wrote: post #31

Earlier quoted context omitted.

Across very cooperative borders in wealthy Europe, sure. Do you think it's as easy for those in India, China, or Kenya, for instance?

Entirely this, many in the West have no idea how difficult crossborder banking actually is for the vast majority of human beings on Earth.

"the West" being Europe. Transfers are still a huge pain in the US.

Re: Facebook plans cryptocurrency debut

#273

Post by baby » Fri, Jun 07, 2019, 8:59 PM UTC

013a wrote: post #196

negamax wrote: post #118

I will revisit this thread in 2021 just to see how wrong everyone was. FB has billions of users that interact with its product everyday. People who make plans, attend events, split all sort of bills. A borderless stablecoin will be a gamechanger. It can fuel commerce but above that it will kill many middlemen and rightly so.

Every new financal technology tries to kill the existing middlemen, then replace them with new middlemen who promise to be better. Turns out, these new middlemen (1) never fully comprehend how complex modern finance is, which raises costs, and (2) are human and thus become corrupt, whether subtly or unsubtly, over time. I also have a sneaking suspicion that, in conjunction with point (1), many of these modern finance…

You're saying that yet Monzo and Revolut (the cool iOS apps you're mentioning) are killing the banking system already in Europe/UK.

Re: Facebook plans cryptocurrency debut

#274

Post by acdha » Fri, Jun 07, 2019, 9:03 PM UTC

stanleydrew wrote: post #265

Frondo wrote: post #190

Earlier quoted context omitted.

"prevents hostile monetary policy" -- except this isn't true. Crypto has just taken monetary policy decisions out of the hands of the electorate, however tenuous a chain of authority that is (voters -> president -> Fed chair), and placed it in the hands of either "the original developers" or "whoever has 51% of network computation". That is an absolutely horrible trade-off for anyone who wants a democratically run cu…

I'm not a crypto fan so don't take this the wrong way, but I think the crypto answer to "someone stole your private key and is stealing your money" is the same as the non-crypto answer to "someone stole your ATM PIN and is stealing your money." Namely, you ask police and prosecutors to track down the perpetrator to get your money back.

ATMs have security measures like daily download limits, unusual locations triggering denials or ID checks, etc. which cryptocurrencies lack.

There's a really big difference between your potential losses being capped zero to a few hundred dollars vs. “everything you own and half of the community will say it was your fault”.

Re: Facebook plans cryptocurrency debut

#275

Post by elcomet » Fri, Jun 07, 2019, 9:07 PM UTC

panic wrote: post #256

InvisibleCities wrote: post #156

Earlier quoted context omitted.

But that doesn't really answer the question being asked. If the cryptocurrency is completely controlled by a centralized authority who has absolute rights over the system, why bother with the technical and cognitive hurdles of using a blockchain? A standard ledger in a centralized database is more than adequate for that task, and much easier to maintain.

It puts their currency in the same semantic basket as Bitcoin and Ethereum. The effort to give these other currencies legitimacy also gives Facebook’s currency legitimacy; many people who support these other currencies will also support Facebook’s. If Facebook’s currency is attacked, it becomes (in some sense) an attack on all cryptocurrencies.

Come on, I'd say it gives the currency an aura of bullshit.

Real currencies (USD, EUR, ..) are stored by visa / mastercard in regular databases, so why not facebook's currency ?

Re: Facebook plans cryptocurrency debut

#276

Post by wbronitsky » Fri, Jun 07, 2019, 9:08 PM UTC

wbronitsky wrote: post #263

negamax wrote: post #118

I will revisit this thread in 2021 just to see how wrong everyone was. FB has billions of users that interact with its product everyday. People who make plans, attend events, split all sort of bills. A borderless stablecoin will be a gamechanger. It can fuel commerce but above that it will kill many middlemen and rightly so.

You might have a good point, but why present it in this way? It is needlessly condescending and makes people want to not believe you. You could have easily stated your case for how much utility and adoption you think this will have without looking down your nose at people who hold a different opinion. Comments like this devalue the entire conversation being had here by pushing people either towards twitter style shit…

Wow, downvoted for pointing out the shitty tenor of conversation on this site. I don't know why I participate any more

Re: Facebook plans cryptocurrency debut

#277

Post by elcomet » Fri, Jun 07, 2019, 9:10 PM UTC

devit wrote: post #268

wz1000 wrote: post #6

Can anyone explain what the point of a pegged cryptocurrency is? Since you are dependent on the issuing entity to honour the stated peg, why not just have your balance be an entry in a regular database maintained by that entity? What exactly does the blockchain gain you here? One thing it does _not_ get you is censorship resistance. If the central authority wants to take away coins from a wallet, all it needs to do i…

It prevents covert malicious behavior by the issuer (i.e. they can't just change a database entry and deny they did so).

But they can since they control the chain.

Re: Facebook plans cryptocurrency debut

#278

Post by brink » Fri, Jun 07, 2019, 9:23 PM UTC

itslennysfault wrote: post #213

negamax wrote: post #118

I will revisit this thread in 2021 just to see how wrong everyone was. FB has billions of users that interact with its product everyday. People who make plans, attend events, split all sort of bills. A borderless stablecoin will be a gamechanger. It can fuel commerce but above that it will kill many middlemen and rightly so.

Why do they need a crypto currency to achieve that? How is it superior to just a number in a database to represents your balance on facebook? Facebook is centralized what advantage does a decentralized currency have for them? Venmo/Paypal seem to have no problem achieving this without a blockchain.

If you want global adoption, make it open. That's what Android does. That's what Linux does. That's what cryptocurrency achieves. That's what Facebook wants.

Re: Facebook plans cryptocurrency debut

#279

Post by simias » Fri, Jun 07, 2019, 9:35 PM UTC

InvisibleCities wrote: post #156

will_brown wrote: post #99

Earlier quoted context omitted.

>Can anyone explain what the point of a pegged cryptocurrency is? What was the point of arcades taking your quarters and issuing you tokens for the machines? Why not just allow the machines to take your quarters? The idea is for the issuer to take real money from you and issue you Monopoly money which the issuer can track and control. In a worst case scenario the issuer can make up new rules (change their terms and c…

But that doesn't really answer the question being asked. If the cryptocurrency is completely controlled by a centralized authority who has absolute rights over the system, why bother with the technical and cognitive hurdles of using a blockchain? A standard ledger in a centralized database is more than adequate for that task, and much easier to maintain.

Technically I can't think of one. I think the last line of the article might be the key: "By introducing a level of decentralization to the governance of the project, Facebook may be able to avoid regulation related to it holding too much power over a global currency."

That plus cryptocurrencies is still a buzzword that generates interest and speculation (especially since they've rebounded a bit these past few months).

Re: Facebook plans cryptocurrency debut

#280

Post by simias » Fri, Jun 07, 2019, 9:41 PM UTC

steveharman wrote: post #239

buzzerbetrayed wrote: post #183

Earlier quoted context omitted.

But using a database as a ledger would clear faster than even the fastest blockchain, wouldn’t it? Or am I misunderstanding what you mean by “clearing”. I’m assuming you mean how long it takes for person A to get money to person B.

Can't a database be potentially breached and suddenly my account has all the "currency" copied I to it from yours? Until Quantum Computing comes of age, this is theoretically much harder with DLT / blockchains.

All banks are effectively running a huge database at the core, yet that's not a common problem. They have procedures, they have backups and they have human oversight. The last element is key, if somebody manages to hack into the system and send all the money into their own account the bank's administrator can detect the problem and say "well, that's clearly not supposed to happen, let's roll that back".

On a decentralized, trustless blockchain you have no such thing. So you either end up hard-forking like Ethereum did after their DAO debacle (but then are you a decentralized trustless system anymore?) or you continue normally and basically the people who lost their money are screwed.