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Facebook Libra Is Architecturally Unsound

stephendiehl.com

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Re: Facebook Libra Is Architecturally Unsound

#61

Post by bennyelv »

__MatrixMan__ wrote: post #43
westoque wrote: post #21

> Libra has no capacity for consumer protection mechanisms. You can replace Libra quote above with your favorite cryptocurrency and that pretty much sums up what I feel on the crypto space.

What are you talking about? Fiat currency isn't reprogrammable--how would you implement a consumer protection mechanism on it? Pick your favorite consumer protection mechanism, and I'll pick my favorite cryptocurrency and let's compare: A) the up front implemention cost of the protection mechanism in fiat currency B) the up front implemention cost of the protection mechanism in the crypto C) the year-over-year cost i…

You've made some assumptions here about the impact of a verified supply chain for vape cartridges, and it sounds like you're proposing a solution to a non-existent problem.

A reputable supplier of vape cartridges gains nothing from having a verified supply chain - people trust them anyway and they maintain a supply of good cartridges to protect that reputation.

A non-reputable supplier of vape cartridges doesn't care, and only sells to people who don't care what they're buying. Their lack of good reputation doesn't matter, and their lack of a verifiable supply chain won't matter either.

If the customer wants a dodgy black market vape cartridge, that's what they'll buy. If they want a quality one from a reputable source, they can already do this.

Re: Facebook Libra Is Architecturally Unsound

#62

Post by __MatrixMan__ »

Retric wrote: post #47
__MatrixMan__ wrote: post #43

Earlier quoted context omitted.

What are you talking about? Fiat currency isn't reprogrammable--how would you implement a consumer protection mechanism on it? Pick your favorite consumer protection mechanism, and I'll pick my favorite cryptocurrency and let's compare: A) the up front implemention cost of the protection mechanism in fiat currency B) the up front implemention cost of the protection mechanism in the crypto C) the year-over-year cost i…

Yea, having third parties capable of reversing transactions has an associated cost. But, it’s Billions relative to fraud, so Billions ends up being cheap.

Yeah, for now it's all we have, so I guess the juice is worth the squeeze. But in a world where our cryptocurrencies are a bit more mature I think we can stop being reactive by reversing transactions and start being preventative by using their structure to build chains and webs of trust that make fraud harder to commit up front, rather than just making it harder to get away with.

Re: Facebook Libra Is Architecturally Unsound

#63

Post by madrafi »

Would like to point that the work done by the curve25519 team is solid, Henry is also behind the ristretto RFC. The reason Facebook used the BFT algorithm is for pure regulatory purposes (they needed a Blockchain therefore a solid consensus algorithm with failure tolerance). The cryptographic constructions used are quite solid unlike OP claims.

Re: Facebook Libra Is Architecturally Unsound

#64

Post by rusk »

Nursie wrote: post #59
rusk wrote: post #33

Earlier quoted context omitted.

because even with a third party, it's still much cheaper, secure, and private.

I mean, except that it's actually not cheaper, you've just moved the trust and security problems around (to your own opsec and your trust in the counterparty) and the privacy most cryptocurrencies provide is pseudonymity rather than anonoymity... But sure, other than all those things.

but I think, with traditional money exchange the reliance is on regulatory and legal enforcement, rather than making the technology itself watertight, which increases the risk profile, and thus cost. You can do this in traditional approaches because you just pass on these costs and there's no need to improve beyond what people are willing to pay. Crypto represents an asymptote for what a rigorously applied technological approach (as opposed to beaureaucratic/legal approach) can do, using commodity equipment, which is much more available at the endpoints of these transactions now ... (because most people have high-powered, always connected computers available to them).

Re: Facebook Libra Is Architecturally Unsound

#65

Post by K0SM0S »

pron wrote: post #37

The answer to the question implied in the article -- why does Libra make such unjustified design decisions -- is simple. Some people have become enamored with blockchain despite it having almost no good use cases, and this certainly isn't one. It seems like a classic example of focusing on the technology rather than on the problem. -- Regardless of the other, far more important sections of this article, I find the se…

If you may spare a minute, I'd like to know your opinion on mission-critical software in dangerous-prone contexts (such as avionics, life support, even just economically for permanently-written "ROM" software, etc). Formal methods seem required in such projects, but your final paragraph seems to imply the formalism isn't key to end quality?

(my agenda, for transparency: I want to send SOC's in space on tiny RISC-V satellites, and the lowest layers of those should be 100% error-free because there's no going physically there to reboot a working shell, remote is all we have.)

Regarding 'love' for blockchain, I think it's the basic proposition of "100% accurate data that cannot be controlled by anyone" that seduces. The 'cost' of that in performance becomes a nagging second concern. It gives people a feeling of safety if no other party, not their bank nor family nor employer nor anyone can alter their data, their transactions (whatever the kind, financial is but one use).

Whether blockchain is the only way to achieve that is another matter, but (afaik?) so far it's the only working implementation of the concept of perfectly secured data. I think that's what drove people nuts. I also think Bitcoin or currency in general is but one use case and a very impractical one in the current financial environment, i.e. Earth circa 2019. I'd wager there are much better avenues to explore, eminently non-financial in nature, such as peer-to-peer 'free' communication, or formal (law, contracts) codification (anything official and 'forever' until 'revoked'). No coin, no market, no whatever but the benefits of a slow but 100% truthful database, for small data (text fits quite well).

Re: Facebook Libra Is Architecturally Unsound

#66

Post by [deleted] »

matthewdgreen wrote: post #56

I don't disagree with the article per se, but I think many technologists are missing the forest for the trees when it comes to the motivations here. Or perhaps they're being charitable and are evaluating Libra on purely on its stated motivations rather than the ulterior motive that Libra can't name out loud. For example, take this quote: "The possibility that a Libra node run by Mastercard or Andressen Horrowitz woul…

[deleted]

Re: Facebook Libra Is Architecturally Unsound

#67

Post by Nursie »

rusk wrote: post #64
Nursie wrote: post #59

Earlier quoted context omitted.

I mean, except that it's actually not cheaper, you've just moved the trust and security problems around (to your own opsec and your trust in the counterparty) and the privacy most cryptocurrencies provide is pseudonymity rather than anonoymity... But sure, other than all those things.

but I think, with traditional money exchange the reliance is on regulatory and legal enforcement, rather than making the technology itself watertight, which increases the risk profile, and thus cost. You can do this in traditional approaches because you just pass on these costs and there's no need to improve beyond what people are willing to pay. Crypto represents an asymptote for what a rigorously applied technologi…

> but I think, with traditional money exchange the reliance is on regulatory and legal enforcement, rather than making the technology itself watertight,

A lot of money and research has gone into this, and the tech is being tightened up all the time.

> which increases the risk profile, and thus cost.

Except the cost isn't actually higher.

> You can do this in traditional approaches because you just pass on these costs and there's no need to improve beyond what people are willing to pay.

In the US perhaps, not in places where these costs are regulated.

> Crypto represents...

A much more expensive and more risky way to do basically anything, because you have neither solved security nor trust problems, you've just moved them.

Re: Facebook Libra Is Architecturally Unsound

#68

Post by Erlich_Bachman »

wiremine wrote: post #20

> Not many people who work on financial infrastructure speak publicly about their work... This was a bit of a throw away line, but I found it insightful. As someone who isn't in this space, my question is: why is this? Is it contractual, or is that just not part of the space's ethos? Feels like we need to overcome this some how to achieve progress?

Why would you give away any details, when each one of them might end up being a secret that is causing your firm to make millions of dollars?

The financial sector is many things, it's a lubricant of the economy, it is a prediction machine, it's a fascilitator of markets, but not least important it is setup as a game, where every player tries to outsmart the others. Why would you talk about how you are playing and give your opponents a chance to outplay you?

Re: Facebook Libra Is Architecturally Unsound

#69

Post by Jeff_Brown »

dadarepublic wrote: post #54
westoque wrote: post #21

> Libra has no capacity for consumer protection mechanisms. You can replace Libra quote above with your favorite cryptocurrency and that pretty much sums up what I feel on the crypto space.

Anyone saying blanket "we don't need consumer protection mechanisms" because it's a "failing" of something or the other must be taking the piss. As a parent of children, consumer protections are overall a "good thing" to help prevent bad actors from doing harm. It goes for any space that can do harm to you or your family in any way. It's why you have exchanges like Gemini in place that seek to be the "most regulated"…

I think it's weird how family gets invoked to change the moral gravity of an issue. It suggests orphaned children, for instance, should care less about humanity.

Re: Facebook Libra Is Architecturally Unsound

#70

Post by repolfx »

derefr wrote: post #52
leeoniya wrote: post #24

Earlier quoted context omitted.

> Virtually every case where consumer protection is useful is covered by existing laws and shouldn't require anything... ...except a lawyer, more money and a non-trivial part of your life.

Yes, that’s the failing. Ideally, justice should be cheaper in both time and monetary costs. I don’t know of any state that has ever tried to optimize for a low-overhead justice system “in the small” (e.g. many, more efficient, more convenient small-claims courts; or the introduction of another triage layer of “medium-claims” courts, where most all civil contractual disputes would land) which is an interesting fact a…

That's what cryptocurrencies allow, since Bitcoin. People can pick a dispute mediator who gets involved and can reverse the transaction only if there's a dispute. It's all done with OP_CHECKMULTISIG. The mediator is not an escrow service and can't steal the money. So you end up with a competitive market of tiny "courts".
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