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Libra, 2 Weeks In

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Re: Libra, 2 Weeks In

#31
>With Libra, anyone with a $40 smartphone and connectivity will have the ability to securely safeguard their assets, access the world economy, transact at a much lower cost, and over time access a whole range of financial services.

Bad actors will lift old exploitative models into Libra's ecosystem: payday loans with huge interest rates, wallet services that force a deposit and allow you to overspend and charge fees when you do, sign up people for accounts and services that they don't want and make commissions. Or maybe just wallet/business services that straight up scam people and disappear with no repercussions. The thing you set out to kill will just come back with a new flavor. Plus it's even easier now since you can do it all with a single click!

Then someone has to decide what to do with bad actors involved with Libra and allocate resources to actually enforce some actions against them (legislative, the cops, server bans, ISP bans, etc.). Now you've got those services paid by tax dollars dealing with a corporate currency and taking time away from other enforcement actions.

All of this is going to happen at the juicy, vulnerable threshold where the technical controls interface with the human element. I probably won't ever hack Libra/Move itself, but the human part is still there. If I can actually manage to get away with the crime and transact with a fake identity, it can't be reversed.

Bonus: that same $40 phone stops getting updated by a phone carrier and some drive-by malware swipes all of your LibraBucks with a corrupt text message and no one can reverse the transaction. Or maybe that Bloomberg supply-chain attack article will finally become a reality once there's enough economy behind Libra.

If this is widely adopted, it's going to have a pretty steep learning curve and plenty of real losses for everyone.

Re: Libra, 2 Weeks In

#32
post #17

Earlier quoted context omitted.

The Fed isn't? It has more private board members than appointed board members, and some have argued that it has consistently prioritized the interests of the banks at the expense of encouraging leverage like cash is going out of style. This is closer to a battle between west coast elites and east coast elites than it is about the people versus the elites.

Well, The Fed is a bit different. It's not exactly a private corporation that is not beholden to the voting public. More importantly, though, is your note about who this battle is between: it's a battle between groups of people who should both be viewed very skeptically when it comes to the interests of "the rest of us". Corporate controlled money has been tried in the past; it didn't end well for workers.

Company scrip has a long and nebulous history, its great for tethering your workers to the company town (and company store) while keeping them indebted and unable to leave: https://en.wikipedia.org/wiki/Company_scrip

Re: Libra, 2 Weeks In

#33
post #23

Earlier quoted context omitted.

Could you explain why you think democracy is important and has much to do with how U.S. currency is managed? It seems to me that voters have very little influence on decisions made by the Federal Reserve, and that's intentional. We wouldn't want a central bank to be much influenced by the latest election. The Federal Reserve is a consortium of banks and tends to make decisions that are good for banks, so if you're wo…

The chair and board of the federal reserve are appointed by the president.

This is true, but being appointed is important. Much like the Supreme Court, they are expected to be independent, not "accountable".

Re: Libra, 2 Weeks In

#34
post #4
post #3

Short of transaction speed and cost, there is so little that is appealing in this compared to Bitcoin, and it has all of the centralisation and compliance pitfalls that a neutral, free (liberty), decentralised money already avoids.

Transaction cost and speed are enormous problems for bitcoin, not sure why that would only be mildly appealing to solve. Not vouching for Libra, but my understanding of bitcoin was that it caps out at something ridiculously low like 11 transactions/second, which each cost multiple USD. Clearly that is the bottleneck that needs to be addressed by whatever would lead crypto moving forward (I remember reading visa proce…

Unfortunately very few alternatives have been created which ticks the same boxes as bitcoin, but some with speed improvements. It's too bad that so many developers have stranglehold their innovations by premining, receiving development tax, keeping a percentage of all coins by themselves. Or lacking a good process for protocol innovation like BIP. Because there are some really shiny coins out there.

I thought that transaction cost and speed was a problem, but I am not so sure anymore. There are second layer solutions, like Lightning Network. And it is also possible to use current solutions like Visa, through pre-filled cards or debit cards. Of course not optimal.

It's not that long ago when we got to choose network protocols in games for example, IPX/SPX in favor of TCP/IP because of speed. Maybe it is a similar time, we'll see.

Re: Libra, 2 Weeks In

#35
post #28

Earlier quoted context omitted.

I think you fundamentally misunderstand how currencies work. They are managed by central banks which are designed to be independent of the government of the day. And corporates basically own and run the internet and it seems to be doing pretty well.

> They are managed by central banks which are designed to be independent of the government of the day. Heh, I think you fundamentally misunderstand how central banks work. 1. The US Mint creates the supply of currency in the US, which is literally governed by the government.[0] 2. It's literally governed by presidentially appointed officials. 3. The Fed manages the banking system, which is a trusted system that utili…

> 1. The US Mint creates the supply of currency in the US, which is literally governed by the government.

Congress long-since assigned that responsibility--with the exception of coinage--to the Federal Reserve. Note that our currency no longer says "United States Dollar" on it, only "Federal Reserve Note."

Re: Libra, 2 Weeks In

#36
post #15

Earlier quoted context omitted.

What does Libra do to people who don't opt to use it?

Assuming adoption - It exists in the world and has all the influence an adopted currency has. Influence controlled by Facebook.

As someone who exists in the world - existing in the world is not a crime!

Re: Libra, 2 Weeks In

#37
post #6

Let's call this for what it really is, they want to replace democracy with Corporatism. At least with a government backed currency we get a choice on who runs the government. Even though that power is constantly being eroded. The companies that run Libra however have 0 obligation to users of Libra but only to maximise profits for their shareholders. This is their plan: * Dedicate a lot of resources to spread the adop…

Bitcoin is not more decentralized than Libra today[1]. Libra has 28 members, going to 100. The top 11 bitcoin mining pools control 99% of the hashrate.

[1] https://www.blockchain.com/pools

Re: Libra, 2 Weeks In

#38
post #7
post #5

Earlier quoted context omitted.

Bitcoin is the oldest and thus technically least advanced cryptocurrency. There are plenty of coins that are much better than Bitcoin in terms of privacy and scalability; Libra should be compared against these.

Wrong. Bitcoin will use Lightning Network for most everyday transactions and it's speed is only limited by network liquidity and bandwidth

Too bad you still need to use the blockchain to get into and off of the LN. which means if BTC got widely adopted you’d still run into major scaling limits. Of course that is assuming LN will ever exist. Which it won’t. It “exists” only a way for shysters to dodge the “bitcoin can’t scale” question when pitching the blockchain to the next batch of rubes.

Also, there is a certain unavoidable irony in suggesting the way to scale bitcoin is to avoid using it.

Re: Libra, 2 Weeks In

#39
post #3

Short of transaction speed and cost, there is so little that is appealing in this compared to Bitcoin, and it has all of the centralisation and compliance pitfalls that a neutral, free (liberty), decentralised money already avoids.

It has price stability, that's a big one.

Re: Libra, 2 Weeks In

#40

Earlier quoted context omitted.

Genuinely curious: Does the lightning network provide all of the same guarantees that the standard Bitcoin network provides? What are the downsides? Why isn't the lightning network used all the time instead of the Bitcoin protocol?

The downside is that there is no market for watchtowers yet (so you need be online while having channels open). Another disadvantage is that if you control your key, you must be online. Like, if you run an HTTP server, you must have a machine. With plain Bitcoin you can spend to a pubkey and it doesn't have to be online

Having to be online to be secure is a pretty big hole, don’t you think? Sure you could outsource it to some trusted party, but that feels awfully bank-like and I thought bitcoin was all about being your own bank. Am I wrong?
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