Facebook Libra Is Architecturally Unsound • Hacker News Board

Re: Facebook Libra Is Architecturally Unsound

#261

Post by kragen » Tue, Nov 05, 2019, 7:40 PM UTC

the_gastropod wrote: post #256

kragen wrote: post #246

Earlier quoted context omitted.

> And Bitcoin lost over 90% of its value in just under 2 years. When do you mean? Right now Bitcoin is US$9400, which is almost exactly half of its all-time high value of US$19891 (in 2017). There are several times it has lost more than half of its value, but I don't remember a time when it has lost 90% of its value. The reason the dollar inflates and never deflates is that it's designed to inflate. On purpose. The u…

> When do you mean? Right now Bitcoin is US$9400, which is almost exactly half of its all-time high value of US$19891 (in 2017). There are several times it has lost more than half of its value, but I don't remember a time when it has lost 90% of its value. Looks like I overstated it slightly . It lost 85% of its value between its all time high December 17th 2017 ($19,891) and December 16th 2018 ($3,159). The rest of…

Anyone who invests in a stock is taking a significant risk of losing 100% of their investment, a risk on the order of 5% per year. Anyone who invests in gold is used to seeing it fluctuate by a factor of 2 or 3 most years. Yet not only are these popular investments — they're better investments than dollars are over all but the shortest time periods. Anyone who invested a large amount of money in stocks or gold in 1973 would be rich today, unless they were very unlucky at picking stocks. Anyone who invested a large amount of money in a bag of dollar bills in 1973 would be poor today.

In short, if any soul you could imagine had won the lottery in 1973, they'd be poor again by now because of not knowing how to manage their money, incorrectly believing that a currency is not a kind of investment.

Re: Facebook Libra Is Architecturally Unsound

#262

Post by mgraczyk » Tue, Nov 05, 2019, 7:42 PM UTC

There are many valid criticisms of Libra, even if we restrict our view to the code. This article contains none of them.

However, use of a BFT consensus algorithm, newish crypto libraries, and missing but promised features in an unlaunched product are not reasonable criticisms.

BFT algorithms that scale well (Libra's will, that's one thing Facebook is good at) are great for public financial networks. All large companies end up implementing their own crypto libraries and for some (Google, Facebook) this ends up a net positive for the open source community.

Consumer protection will be there, Facebook is not going to knowingly violate local regulations in such an obvious way.

Re: Facebook Libra Is Architecturally Unsound

#263

Post by arcticbull » Tue, Nov 05, 2019, 7:42 PM UTC

randomidiot123 wrote: post #229

arcticbull wrote: post #135

Earlier quoted context omitted.

Ok round 2. > “inflation is theft” I think you didn’t read anything I wrote because my core focus is that inflation is 100% avoidable through investment which is the behavior explicitly being incentivized via, to your point, a stick and not a carrot approach. It’s theft like taxation is theft: it’s not. > a GSE creates money from nothing Yes that’s the point. The economy gets bigger and more people are born and the m…

Simply being born is no justification for stealing by fiat. People should be rewarded for saving capital. Forcing people to gamble their money only to maintain the wealth they already earned is not ethical. It is sufficient for people to be incentivized to spend money on things that are useful or interesting and to invest for higher return where the investment is sound. EDIT: the money stolen by fiat is not evenly re…

People should be rewarded for saving value not cash. That’s the point. Invest the cash and problem solved.

Re: Facebook Libra Is Architecturally Unsound

#264

Post by arcticbull » Tue, Nov 05, 2019, 7:46 PM UTC

stale2002 wrote: post #228

arcticbull wrote: post #71

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…

> why they think money should be worth more later Because it is my choice? If you want to use an inflationary currency, go ahead. But other people should have the option of opting out, and using a different currency, with different properties

That’s not a reason. Give me a justification for why you think money should be worth more later. Because it would be sweet for you isn’t really compelling. I gave you a reason for inflation and your counter was “because I would be rich” - see if you can make a better case and if not, maybe reconsider your position.

Re: Facebook Libra Is Architecturally Unsound

#265

Post by briatx » Tue, Nov 05, 2019, 7:47 PM UTC

magnamerc wrote: post #130

As soon as blockchain is even mentioned on HN, everyone loses their freaking minds. For some people that tout themselves as intellectuals, they just seem to parrot that 'blockchains are useless' without even taking a cursory look into the technology. It seems to me that a lot of people here fall into the category of ultracrepidarianism.

Or maybe after much research and some testing they conclude (correctly) that "blockchain is useless."

Re: Facebook Libra Is Architecturally Unsound

#266

Post by carapace » Tue, Nov 05, 2019, 7:50 PM UTC

frenchyatwork wrote: post #183

pron wrote: post #154

Earlier quoted context omitted.

> the core benefit of blockchain is reduced transaction costs. No, this is not true. It might incidentally currently be the case with, say, Bitcoin vs. $US, but there's nothing technical that inherently makes it so. In fact, as this article and countless others reiterate, from a technical perspective blockchain is almost always more costly.

Indeed. The main reason why a given bitcoin transaction might be cheaper is because nobody's checking to make sure it's actually legal. It's the same reason why AirBnB is often cheaper: hosts don't pay business fees and don't follow other regulatory requirements like safety inspections.

You just reminded me: A friend of a friend who worked at Autodesk told me once that their inter-office "mail" system was international and didn't go through customs.

Re: Facebook Libra Is Architecturally Unsound

#267

Post by michaelmrose » Tue, Nov 05, 2019, 7:50 PM UTC

pron wrote: post #73

K0SM0S wrote: 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…

>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.

This seems to be poorly considered. Isn't it easier for an OS and a language to be verified once even at great cost than hoping future billions of lines of developer code already produced at lesser cost per line are actually correct?

https://microkerneldude.wordpress.com/2016/06/16/verified-so...

Re: Facebook Libra Is Architecturally Unsound

#268

Post by YawningAngel » Tue, Nov 05, 2019, 7:56 PM UTC

matthewdgreen wrote: post #148

nokcha wrote: post #143

Earlier quoted context omitted.

>"The possibility that a Libra node run by Mastercard or Andressen Horrowitz would suddenly start running malicious code is such a bizarre scenario to plan for and is better solved by simply enforcing protocol integrity and through non-technical (i.e. legal) means." In regards to that, I don't think it's any more bizarre than a SCADA system in an Iranian nuclear enrichment plant suddenly running malicious code. Cyber…

To the best of my knowledge, no deployed banking system relies on immutable ledgers. They all rely on detection and revision of ledgers. Libra has chosen to do something fundamentally different, and the author is asking why.

Adding to the other posters, Monzo's ledger is immutable (this is in fact a design requirement, since Monzo's Cassandra environment makes it impossible to update rows atomically).

Re: Facebook Libra Is Architecturally Unsound

#269

Post by jpadkins » Tue, Nov 05, 2019, 7:57 PM UTC

AlphaWeaver wrote: post #76

pron wrote: post #73

Earlier quoted context omitted.

> 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…

> 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?

There are a lot of minor threats to monetary systems that blockchain does not address. Bitcoin addresses the rare but fatal threat of hyperinflation (runaway inflation). Historical examples https://en.wikipedia.org/wiki/Hyperinflation#Notable_hyperin...

The only known solution to this threat is not have a single supplier of money (i.e. a lot of independent miners digging metal out of the ground, or the block chain equivalent)

Re: Facebook Libra Is Architecturally Unsound

#270

Post by lubujackson » Tue, Nov 05, 2019, 8:03 PM UTC

I am always amazed at the concept that blockchain is private at any level. The architecture is built specifically to share transactional data. It is useful for creating a digital entity that is unique and can be treated as currency, but the shared transactional nature is a huge, huge privacy flaw, as far as I understand blockchain (at least Bitcoin). Please correct me if I am wrong about the public nature of transactions - I haven't seen anything discussing the encryption of transactions but I am by no means an expert on this.

So assuming the transactions are accessible to anyone (and even encrypted is somewhat worrisome), what are the implications? Well, for a while Whole Foods was accepting payment by Bitcoin. That means if you know Whole Foods' Bitcoin account number you could simply look up all transactions to Whole Foods to see how much money they were making through Bitcoin, how many unique accounts paid them as well was when and how much. Does every business want their detailed transaction history to be public?

And on a personal level, I remember when Netflix released anonymized data of movie ratings with ratings and date stamps. From this alone, some people were identified by looking at other personalizing data: https://www.wired.com/2007/12/why-anonymous-data-sometimes-i...

All it would take is one data harvesting company to pair your account to your transactions and then could track everything you do through it. I really hope this isn't how all of this works... and even if there are protections to prevent this, it seems like a viable attack vector to consider for any blockchain technology.