Ask HN: Why crypto is rising so fast when its not creating value?

Because we currently live in a world with: 1. A high-liquidity environment for VC firms 2. A high-liquidity environment for retail investors 3. Unprecedentedly easy, fun and addictive speculation tools

Once the crypto bubble took off thanks to this unprecedented bull market, it also attracts many smart engineers, businesspeople and entrepreneurs who jump into the gold rush hoping to sell picks & shovels.

There's one more aspect here. I've coined the term "Bloated MVP" [1] from years of watching startups that lack a coherent value prop, and don't know who their first user will be, and never get any traction whatsoever, but nevertheless manage to raise $millions and suck up smart people's time and energy. I've also spent years founding such companies myself. The reason people work on bloated MVPs is because they don't realize that an idealized abstract vision is very different from a value prop.

So to summarize: The crypto space is a massive ecosystem-level bloated MVP, intermingled with the biggest liquidity bubble of all time, and unprecedented speculation opportunities

[1] https://bloatedmvp.com

A distributed namespace system is pretty cool (https://ens.domains/)

Crypto at its best is a use case and driver of investment in decentralized databases.

However, that leads to the question of whether we need decentralized databases. Networked computing tends to lead to centralization of services, if not at a single node then in a collection of nodes each of which is the best at what they do. Google is for search, Amazon is for e-commerce, etc.

Given the tendency towards natural monopolies, do decentralized databases make sense? They are slower and more duplicative than centralized databases.

Decentralized databases shine when a multiplicity of providers reduces the power of each node. In the parlance of monopoly, the node operators of a decentralized database are price-takers not price-setters.

Decentralized databases make economic sense when the operational costs associated with them are offset by the lower prices on offer compared to a monopolistic price-setter.

However, the tech monopolies currently offer their services free or at cost, with all the efficiencies that come with scale. I don't think we need decentralized databases now.

Still I think it's something good to have in your back pocket if the state of monopolistic software gets worse. I see the crypto market as crowd-funding R&D for something that may be needed in the future.

The comment in this thread are powered by ignorance. Study the history of monetary systems going back around 690 years to present. Fiat currencies eventually fail due to government hubris. Bitcoin's algorithmic cap on units addresses that. Alt-coins are more transactional and many are more like businesses. BTC is going to continue to grow. Some tiny fraction of the alt-coin market will thrive and potentially have even larger market caps than BTC. These coins are getting traction for different reasons but BTC is an asset with staying power that provides a means for hedging against devaluing fiat currencies. Altcoins are going to take margin away from financial services entities by empowering transactions that won't require intermediaries. I think that crypto currencies are an innovation with many positive attributes.