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The Non-Innovation of Cryptocurrency

stephendiehl.com

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Re: The Non-Innovation of Cryptocurrency

#31

Post by skohan »

creshal wrote: post #26
mdoms wrote: post #20

Earlier quoted context omitted.

Can you name such a technology that existed for well over a decade before any real use cases were found?

LASER, back when it was still written in all caps. It was called "the most useless invention of the century" for a while, and it took close to a decade to figure a use for it. But I think the whole discussion is missing the point. Blockchain is mostly not trying to be a solution to engineering problems, but societal, "how do we do X without a trustworthy party involved ". We already know how to do any given X with so…

But this is a totally abstract argument. Can you point to a tangible example of blockchain being used to solve a real societal problem, in a way which is competitive with other, more conventional solutions?

Re: The Non-Innovation of Cryptocurrency

#32

Post by skohan »

keymone wrote: post #7

> However bitcoin is a technology which did not arise out of an engineering effort directed towards a specific problem or market inefficiency, but instead out of a anarchist political narrative that views democratic control of the money supply and law enforcement as the problem. omg this is painful. democratic control of money supply? no market inefficiencies? does author live in a separate reality? bitcoin is the bi…

I agree that Bitcoin probably has had about as much impact on the financial system as sliced bread.

Re: The Non-Innovation of Cryptocurrency

#33

Post by bhawks »

skohan wrote: post #17
hvidgaard wrote: post #15

Earlier quoted context omitted.

Many of mans greatest inventions have started like this. Just because we are not aware of a problem today, does not mean it is not there, will not come, or that it can be solved efficiently in other ways.

Blockchain is quite old at this point by technology standards, no? In 2017 there was a ton of attention and funding going into the space - it's not as if there hasn't been the opportunity to do something interesting with blockchain.

The fine article and your comment both say crypto is 'old' tech. TFA points to iPhone's 2007 release date as if no one (even apple themselves had tried to crack the personal digital assistant before). Which is a laughable omission of history. The first PDA landed in the 80s. Apple started development in 87 on the newton and didn't have a product til 93. The iphone stands on the ashes of 2 decades of product and engineering iterations. The AI winter lasted from 80s until the 2010s. Technology takes time and innovation is a discrete not continuous function. If we all gave up after 10 years we would be sitting in caves and probably not even planting seeds.

TFA is full of blustery arguments to say that crypto is a worthless dead end and should be banned deserves more reasoned arguments. Toning down the emotional levels might be a good first step.

Re: The Non-Innovation of Cryptocurrency

#34

Post by creshal »

skohan wrote: post #31
creshal wrote: post #26

Earlier quoted context omitted.

LASER, back when it was still written in all caps. It was called "the most useless invention of the century" for a while, and it took close to a decade to figure a use for it. But I think the whole discussion is missing the point. Blockchain is mostly not trying to be a solution to engineering problems, but societal, "how do we do X without a trustworthy party involved ". We already know how to do any given X with so…

But this is a totally abstract argument. Can you point to a tangible example of blockchain being used to solve a real societal problem, in a way which is competitive with other, more conventional solutions?

I can't. That's why I'm saying it's the real problem, not the engineering side.

Re: The Non-Innovation of Cryptocurrency

#35

Post by lmm »

neilwilson wrote: post #21

"There are indeed a lot of fools in this world, but to presume an infinite chain of them as the core of an investment thesis is beyond absurd." It's worked for gold and diamonds for generations. Not to mention pretty much every artwork or other concoction human beings create and then collect. There's not a lot of cash flow from first edition Marvel comics, but there are an awful lot of them stored in plastic bags. Hu…

> It's worked for gold and diamonds for generations.

Gold has literally millennia of tradition. Diamonds have minimal resale value and are not bought as investments.

> Not to mention pretty much every artwork or other concoction human beings create and then collect.

> There's not a lot of cash flow from first edition Marvel comics, but there are an awful lot of them stored in plastic bags.

Right, and IMO that kind of collectible is a much better model for thinking about bitcoin et al. than commodities or currencies. Do some people flip them for a profit? Yes. Are they a good investment strategy? Generally no. Look at e.g. stamps, where the whole bottom has just fallen out of the market as the generation that cares about them disappears.

Re: The Non-Innovation of Cryptocurrency

#37

Post by bryanrasmussen »

sneak wrote: post #13

> Ending this scourge on civilization is one of most important political problems facing the international community these days, and marks a new era of global cooperation on financial regulation that now necessarily transcends borders and nations. A very neutral, objective viewpoint. > However bitcoin is a technology which did not arise out of an engineering effort directed towards a specific problem or market ineffi…

>> However bitcoin is a technology which did not arise out of an engineering effort directed towards a specific problem or market inefficiency, but instead out of a anarchist political narrative that views democratic control of the money supply and law enforcement as the problem.

>A completely false claim.

my admittedly not in depth understanding of the history is that it should be written as:

Bitcoin as a technology arose out of an engineering effort directed towards solving what its anarchist political creators saw as the problems of democratic control of the money supply and law enforcement.

I mean I would say it is false that it did not arise out of an engineering effort to solve a problem, just not a problem that most would agree is much of a problem.

Re: The Non-Innovation of Cryptocurrency

#38

Post by occamrazor »

creshal wrote: post #30
neilwilson wrote: post #21

"There are indeed a lot of fools in this world, but to presume an infinite chain of them as the core of an investment thesis is beyond absurd." It's worked for gold and diamonds for generations. Not to mention pretty much every artwork or other concoction human beings create and then collect. There's not a lot of cash flow from first edition Marvel comics, but there are an awful lot of them stored in plastic bags. Hu…

Precious metals and gemstones are also physical objects with strong industrial demand, that people hope will survive a civilisatory collapse; blockchain tokens can't even survive a prolonged power outage. Artworks are desirable because they're physical objects with a limited supply that we can use to impress our peers. Memecoin #21983 can't do that. Currencies are also backed by the physical assets of the country/cou…

> Precious metals and gemstones are also physical objects with strong industrial demand, that people hope will survive a civilisatory collapse; blockchain tokens can't even survive a prolonged power outage.

Industrial demand for natural diamonds is approximately nil, synthetic ones are cheaper and have better properties. Industrial demand for gold is larger, but it wouldn’t remain that large in case of societal collapse.

> Artworks are desirable because they're physical objects with a limited supply that we can use to impress our peers. Memecoin #21983 can't do that.

The NFT mania (and CryptoKitties before that) have shown that at least some people are impressed by it and are willing to pay for it. I don’t get it either, but I can’t deny it’s happening.

> Currencies are also backed by the physical assets of the country/countries issuing them, guaranteeing that you will find a buyer and will get value for it. Worst case, by making the country in question pull a Greece and sell you its lands. Who will give similar guarantees for memecoin #19381?

Greece could not devalue the Euro unilaterally. Investors in Argentinian bonds had a different experience.

Re: The Non-Innovation of Cryptocurrency

#39

Post by jahnu »

neilwilson wrote: post #21

"There are indeed a lot of fools in this world, but to presume an infinite chain of them as the core of an investment thesis is beyond absurd." It's worked for gold and diamonds for generations. Not to mention pretty much every artwork or other concoction human beings create and then collect. There's not a lot of cash flow from first edition Marvel comics, but there are an awful lot of them stored in plastic bags. Hu…

There is a lot of that. But my own feeling is that this is mainly a novel form of gambling. Sure there are stories of people risking their entire financial security on these things but I am willing to be the vast majority of people invested are playing with money they can afford to lose.

Vegas is a ridiculous "unsustainable" city built where no city should be and so are cryptocurrencies and all that's built on that.

Re: The Non-Innovation of Cryptocurrency

#40

Post by RandomLensman »

redpiller wrote: post #29
timkam wrote: post #19

Earlier quoted context omitted.

Can you elaborate? I doubt your claim because "how much profit" a business makes is tied to the legal/financial system(s) the business operates in. To me it looks like we have the "object level vs. meta level" fallacy that is so typical for crypto enthusiasts: in the end, what governs our society is not crypto tech (object level), but meta level institutions. And even if these institutions were to agree that, for exa…

Here is an article about our use case: https://jonathangrosdubois.medium.com/how-leasehold-achieves...

Maybe I get this wrong, but doesn't this rely very classically on aligned interests and various parts keeping the other parts in check? No blockchain or tokens required...

I did not see anything how profit is verified. Could always use expenses to funnel money out, opex and capex are mixed creatively etc.

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