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Facebook Libra Is Architecturally Unsound

stephendiehl.com

111–120 of 347 posts

Re: Facebook Libra Is Architecturally Unsound

#111
post #52

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…

> I don’t know of any state that has ever tried to optimize for a low-overhead justice system “in the small”

Both small-claims courts themselves and rules giving effect to binding arbitration agreements are attempts to do that, as are many specialized, domain-specific administrative forums.

Re: Facebook Libra Is Architecturally Unsound

#112
post #90
post #87

Earlier quoted context omitted.

I'm not sure that is "why we have it". It sure is why the central banks are pumping money into the system (they quite rightly want people and companies to invest), but it's far from clear why we have it a priori.

The answer is simple - trivial even. As I mentioned before a dollar today should be worth more than a dollar next year since, if you are smart, you can make that dollar work for you for a whole year. Hence the inflation.

No, not "hence the inflation".

You have not explained why; you've explained why you think we should have inflation. And why someone thinks something should be is a long way from explaining why something is.

Re: Facebook Libra Is Architecturally Unsound

#113
post #106

Earlier quoted context omitted.

I’m consistently amazed by how many people here dont understand inflation at all and are confident they need to throw out the financial system before they figure it out. Inflation is an incentive to invest. If you invest in literally anything other than cash under your mattress inflation stops mattering completely to you, and all you have to think about is constant dollar returns. That’s why we have it. So long as yo…

> savings account as many offer 1.8% interest these days I don't know where you live but I doubt it's western Europe. In the Netherlands for example, the highest interest rate available [1] is a lousy 0.2%. [1] https://www.spaarrente.nl/

I’m referring to a US audience (Ally offers 1.8%). These rates are designed to incentivize you to allocate capital accordingly. The point is you not put much of your money there. Depending on how you feel about the future exchange rates between the EUR and USD you’re welcome to invest in US treasuries, for instance.

Re: Facebook Libra Is Architecturally Unsound

#114
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…

Regarding your claim that blockchain has almost no good use cases, I see news every week which disagrees. Here is the first article I could find from just today which shows a great use case. Coca Cola is expanding their blockchain trial project to a $21 billion-a-year supply chain because they found very significant savings. https://www.coindesk.com/coca-cola-supply-chain-firm-to-expa...

Why would Coca-Cola need to use a block chain? They can run their own code on their own servers.

Re: Facebook Libra Is Architecturally Unsound

#116
post #86

Earlier quoted context omitted.

> Security is defined with respect to certain threats, and blockchain is rarely the most secure with respect to the threats in a monetary system. Wow, this is a great way to frame this! What do you see as the largest threats to the effective operation of a monetary system?

I think this question is best answered by economists, and I'm certainly not one. But blockchain does seem to interfere with some of the best regulatory defenses against economic disasters.

Blockchain gives the impression that the primary threat it is designed to defend against, is a government deciding (like Germany between world wars) to inflate their currency for whatever reason. So, not surprisingly, in order to defend a currency against being decreased in value by a central authority, it is vulnerable to all of the threats that a central monetary authority might help you with.

Which of these threats you think is the more salient is, of course, a matter on which people may disagree. I personally find the risk of a central monetary authority devaluing my money, to be not one of my top concerns, but I could understand why others might think differently (especially if they were in a different country, that used a different currency).

Re: Facebook Libra Is Architecturally Unsound

#117

> 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.

cryptocurrencies are replacing cash, they arent supposed to have protections. other services will be built on top of them

Re: Facebook Libra Is Architecturally Unsound

#118
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…

Regarding your claim that blockchain has almost no good use cases, I see news every week which disagrees. Here is the first article I could find from just today which shows a great use case. Coca Cola is expanding their blockchain trial project to a $21 billion-a-year supply chain because they found very significant savings. https://www.coindesk.com/coca-cola-supply-chain-firm-to-expa...

Read tip: https://blog.smartdec.net/you-do-not-need-blockchain-eight-p... previous HN talk: https://news.ycombinator.com/item?id=19225857

Re: Facebook Libra Is Architecturally Unsound

#119
post #73
post #65

Earlier quoted context omitted.

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 sa…

> but your final paragraph seems to imply the formalism isn't key to end quality? That's not what I said. I said that merely creating a verified formal specification of a language is not in itself a good path to increasing correctness, and I wouldn't focus on that as a significant cause for concern given all others. But even when you use formal methods in the development of your software -- and I'm certainly a propon…

Exactly what I needed to hear, thanks again.

I reckon the only way to error-free is redundancy, i.e. 'out of the box' we just put two boxes, or actually three for "high availability"; the underlying controller being just a dead man's switch — if A's life signal dies, failover to B; set up C as new failover; reboot A.

> I personally believe that some formal methods can greatly improve correctness, and do so affordably, but the question of which formal methods are worthwhile when and by how much each of them improves correctness is very much an open question.

Oh I can see that.

In general terms, I think cost should be focused on the most critical components; like we don't need to test every single bit of code before production. You just crash gracefully and resume state when the loss (if any) is acceptable. When it's not, then it's not a choice to front the cost, it's an imperative, part of your 'spec' as a business/product/service/free thing. Tor is slower than normal browsing, but that's the tradeoff. Fast forward 10 years and costly workloads have become either accelerated by hardware or simply benefit from general improvements, like encryption is now fundamentally cost-free for usual things like TLS (AES-based things), or increasingly AI workloads.

> blockchain is rarely the most secure with respect to the most relevant threats in a monetary system.

I very much agree. Key words being "in a monetary system", and indeed it's about economics more than tech (what I alluded to in saying 'Earth circa 2019', i.e. globalized monetary system, central-bank driven, mostly insured for most customers, etc).

Hence why I advocate that blockchain proponents explore other domains. I know businesses are, but it has more to do with topics like compliance (internal, legal).

Re: Facebook Libra Is Architecturally Unsound

#120

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…

Or, you know, legislators just ban it entirely until the changes are made.

Edit: Its also pretty ironic that the crypto currency is banking on "too big to fail."

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