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I'm a tech guy. I've spent years experimenting with crypto and it isn't fit for any legitimate purpose.
Stablecoins like USDC, if everything around it is legit, can be viewed as a programmable dollar... circumventing everything and anything bank-related to do the same work. That's pretty legit IMO.
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this = blockchain + proof of work / proof of stake , in my comment. The crypto currencies are a requirement to fulfill the Byzantine tolerance. They need to have value in order for the incentives to make sense
> The crypto currencies are a requirement to fulfill the Byzantine tolerance. I find this writing to be unclear and/or circular. Are you saying the following? _If_ the primary goal of a system is Byzantine fault tolerance, using a cryptocurrency is a requirement?
- a way to ensure that users of the system can't cheat by creating a vast number of nodes and inflate their "voting power" (think of a poll where you can get behind a proxy to vote multiple times because the only security is weather or not the IP voted): this is the hash-cash, proof of work computation that ensures you have real hardware behind your "vote"
- an incentive to mine and secure the network: the cryptocurrency. The amount of cryptocurrency you mined is just a translation of the energy and work you did to secure the network the same way as a banknote is a conversion of X number of hours you worked for someone.
The question, like I stated in another comment, is whether or not this distributed ledger is useful. Let's say we haven't discovered the killer use case for this yet (putting my skeptic hat). Is it fair to dismiss it just because of all the scams related to its current use ? Do we do the same for email just because there's so many phishing attacks that happen on the protocol ?
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People have been saying this for over a decade now. Mainstream applications are just around the corner, wait and see! We have waited, and all we've seen is baseless speculation (which you call "wealth savings/growth") and scams. I see no reason to think this is going to change any time soon.
I mean, it is being adopted by pay processors like Square, PayPal, and Cash App, and is being accepted by some large retailers like Newegg and Overstock. Wouldn't discredit that as not being progress :/
> I agree but I raise you one better.
> We in tech need to talk about how graft and lies are not qualities of entrepreneurship, and that they are disqualifying.
> We need to dispel the myth of moving from con to legitimacy, and that fraud may be justified if founders do it.
I've worked in both finance and technology. I think the technical people aren't seeing how amazing this is from a finance point of view. Payments are going to be completely transformed by this. All of fixed income will change to be oriented around crypto. It's just a matter of time. All the main preconditions for crypto to take off are finally in place. If you are a professional money manager or CFO there is no way i…
No one is going back to a Fed fund rate pegged savings account after parking stablecoins in a DAO governed yield farm aggregator. Critics think we're in the Dotcom bubble of crypto right now, but we're still in the Usenet stages. You need technical expertise in finance and computer science to grok crypto. I would ask any naysayers to this point in particular to share their understanding of some protocol like Aave, Su…
There’s no free lunch.
I think bitcoin was a research project - it wasn’t designed to succeed as a real currency. Consider:
1) It has a fixed money supply. There will only ever be a fixed amount of bitcoin once it is all mined (or technically, the amount will grow more and more slowly forever— effectively, it’s a fixed amount). We’ve known for a long time what effect this has on a currency. A fixed supply will be deflationary, i.e. the value of 1 btc will only grow. To be stable, the total amount of currency in circulation must equal the economic value that it represents. This is why the Federal Reserve must continually expand the money supply - it’s because the US economy grows. (They actually expand it slightly faster than the economy grows, causing a small amount of inflation, on purpose. This is preferable to undershooting and creating a deflationary currency). Deflation makes for a terrible currency, because it inhibits spending. If you think your dollar will be worth more tomorrow, you’ll wait to spend it. That waiting cascades into the broader economy, causing a recession. Bitcoin can therefore never, ever be a true currency. Its deflationary design prevents it.
2) Transactions are public. Far from being a cash replacement, which is both anonymous and private, Bitcoin transactions are publicly recorded on the blockchain. There are elaborate work-arounds to improve privacy, but fundamentally the ledger is public. This is not a good feature for a cash replacement.
3) There is no one in charge. Would you trust the US dollar if a loose collection of volunteers struggled for control over key monetary decisions? Despite best efforts, governance of bitcoin is a disaster — because it wasn’t designed for governance.
4) It’s extremely expensive. Search recent news for the estimated electricity usage of bitcoin mining. It’s so large that a hedge fund recently restarted a decommissioned fossil fuel power plant just to mine bitcoin. Do you think this is a good design?
5) It’s inconvenient. Have you tried to make a bitcoin transaction? Were you surprised that you could pay extra in order for the transaction to settle faster? Did you think that was ridiculous? You’d be right!
I’m glad more people are speaking up about bitcoin. The emperor indeed has no clothes. Bitcoin is getting out of hand.
I've worked in both finance and technology. I think the technical people aren't seeing how amazing this is from a finance point of view. Payments are going to be completely transformed by this. All of fixed income will change to be oriented around crypto. It's just a matter of time. All the main preconditions for crypto to take off are finally in place. If you are a professional money manager or CFO there is no way i…
Why is cryptocurrency/blockchain necessary for that? You could have all of this with open banking standards.
Blockchains solve this problem, as in mathematically proves that certain classes of exploits requiring information asymmetry are impossible.
We could have all of this with open banking standards? You're looking at them!
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I've been using Bitcoin to get paid for a couple of years at this point (programming work for overseas clients), and I haven't gotten scammed yet. I'm not engaged in money laundering, vaporware, fraud, ransomware, or gambling, and only the usual amount of delusion. And I don't even buy illegal drugs! And, yeah, 13 years after the internet's invention was 01982; not only couldn't you get so much as a weather report on…
OT, but how come you use 01982 rather than 1982? Is that a personal / subculture / locale thing?
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Bitcoin didn’t regress, what actually happened is that its fundamental flaws ended up eventually dominating whatever early enthusiasm allowed them to be ignored. It was never going to work, for a variety of reasons that were incredibly apparent at the time. “Why did it regress” is much less interesting than “why did anyone ever fall for this?”
Fees high, world too stable, heavy speculation. Cryptos forced to trade on centralized exchanges to avoid fees, making it a much crappier version of something like PayPal. Doesn't help that there's an unending supply of people more than willing to participate in ponzi schemes creating massive volatility and turning the "currency" into the commodity.
Sologenic DEX [1] is an modern UI for a DEX to trade. Cutting out the middlemen was once a key point of p2p and decentral systems. It was kinda lost with all the non tech savvy people storming the crypto space.
[1] https://www.sologenic.com/ecosystem/sologenic-decentralized-... (The DEX runs on the XRPL, Manticore Securities AS(the company behind sologenic) has no control over it)
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> They are trading property, buying virtual artwork and creating galleries, setting up clubs and meeting spaces, etc. This all happens in Second Life and doesn't need to burn the planet to do it.
If you think these defi projects are hurting the environment then you have not been paying attention to the industry. Proof of Stake, what most smart contract tokens are moving to, is very energy efficient.
Anyway, none of this matters because Bitcoin exists and is the dominant shitcoin (due to first mover advantage). All these other shitcoins can claim whatever efficiency, but it doesn't matter because that's a very isolated view of the problem. The shitcoin economy as a whole will still be fueled by mining unless somehow Bitcoin gets dethroned and the whole mining thing just goes away. I can't imagine that happening without the whole economy crashing completely into the ground – but that would bring all these efficient coins down with it.