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Web3 is centralized

blog.wesleyac.com

31–40 of 497 posts

Re: Web3 is centralized

#31

The main issue with "Web3" is that it moves records of transactions from many private places to one public place. Sure this one place may not be controlled by a single entity, but it facilitates tracking at an unprecedented level. Cryptocurrencies are the ultimate example of this and are an absolute boon to tax collectors, forensic accountants and fraudsters. In our current economy financial transactions are recorded…

This is not true for Monero, that hides the sender, receiver and amount for all transactions by default.

Re: Web3 is centralized

#32
post #6

I think this is a pretty weak article regarding web3. The author wants to claim Ethereum or Bitcoin are more centralized than HTTP, but that isn't a valid comparison. Anyone can spin up their own blockchain exactly in the same fashion of spinning up their own webserver. It's more comparable to something like AWS or Discord or Twitter. Now, I would still say the majority of all things developed on the blockchain are v…

Yes, and it will be incredibly insecure unless you either convince a ton of other people to spin up nodes and act honestly in concert with you to run your network, or you build it atop Ethereum etc. Almost the only way to spin up your own is to come up with a world-changing idea, write a whitepaper and sell it to VC. So realistically people build atop Ethereum etc, and that still takes VC money because getting anything done on the famed World Computer is like booking time on a mainframe in 1976.

You don't need VC money to boot up your own HTTPS server on a traditional stack. There are lots of ways in which traditional stacks are not very censorship-resistant, and there are many ways to improve it. But at least anyone can participate on their own terms without having to either write a pitch deck and get funded, or accede to majority rule over some really important parameters of how their network operates. VC money alone is a much more pernicious influence on what will be acceptable behaviour than installing Nginx. The money required is just as heavy censorship as having to go through Visa to accept payments.

If you think "but what about email? Isn't it prohibitively expensive to run your own email server securely?", then you have fully understood the point about blockchains actually facing the same pattern of centralisation that the rest of the web does, but worse, because the alternative (your own big enough, secure enough chain) is comparatively even more difficult to adopt than the mainstream (Eth). You don't need ten million dollars and your own cryptographers and formal verification specialists to write or run an HTTP server, IMAP server, or IP network. Each of which you can do exactly as you please, essentially nobody else dictating how you do it and with costs at the bare minimum, and all of these interoperate with other people's just fine.

If you want an example of a "web3" technology that's not subject to these arguments, just look at IPFS. It's just a bunch of 20-year old ideas combined (bittorrent-esque peer discovery, mixnet routing, content-addressed blob hashes in git). None of the above problems are any worse than they are in Web 2.0, and it is leaps and bounds more censorship-resistant. You could plug in a permanent node or two today, subscribe it to a stream of authenticated tree hashes, and use it as your personal dropbox. If more people used it, you could just publish web pages there, by dragging and dropping a folder. If you have another technology that you think is a Web3 candidate, please compare it to that.

Re: Web3 is centralized

#33
Web3 is less centralized in that the user data is exposed and freely available to be composed upon.

For example, when someone makes a deposit (say of ERC20 USDC to earn interest, around 3.0% currently) on https://compound.finance, that data is freely available and the "receipt" becomes another token (the ERC20 USDC cToken). [1]

This token can now be used for other things, on any other protocol, without the involvement of compound itself. For example, there is a "compound" pool on https://curve.fi that allows users to deposit cTokens so that they can earn interest on their stablecoins while also providing liquidity for stablecoin swaps and earning swap fees as well on top. [2] In fact, with this pool, the user can deposit/withdrawal just pure ERC20 USDC instead and curve will deposit/withdrawal that into/from compound on behalf of the user, again, with no involvement of compound at all. (other than interacting with its "immutable" smart contract)

This deposit then gives the user back another ERC20 token "cCrv" that can then be used in other DeFi protocols without the involvement or authorization of curve.

At this point people are talking past each other because "centralization" can be used to refer to many things. The author's analogy is arguing about the direction/standardization of the technology, and the proponents of the technology are talking about the user data.

[1] https://compound.finance/docs/ctokens

[2] https://curve.fi/compound

Re: Web3 is centralized

#34

web3 is not there yet but people are putting sincere efforts to get there. web3 is more open source than current centralised web, all contracts on blockchain can be read and forked, all coins are open source. forking coins, contracts, communities are all happening, new leaders emerge and consensus build, but new use case emerge where people and their motivations differs, the cycle of forking starts again. NFT content…

Are we comparing web3 to FAANG or tcp/http/etc.

As the article describes at a protocol level web3 is definitively not more open, it's more centralised as opens you to noisy neighbours.

At the application level it may enable finance to be decentralised, but that's only a small part of the web.

Re: Web3 is centralized

#35
The author thinks that to be decentralized, you should have your own chain. Holochain has one chain per app, more similar to what the author wants. It's not exactly a blockchain though. There are quite a few other non-blockchain projects in development also.

Found an overview that shows non-blockchain projects. Not sure whether or not it's an accurate comparison of features, but it's the best of list I've found of alternative crypto technologies. https://i.postimg.cc/05RJqbYB/SN-Comparative-Analysis-v4-1-I...

Re: Web3 is centralized

#36
post #3

My main concerns with Web3 are that it is "pay to play" in many aspects and it's less democratic than the existing Internet.

The existing internet is dominated by trillion dollar monopolies. How do you reconcile that Web3 is less democratic than a megacorp oligopoly than can unperson people at will? Web3 has decentralization, freedom of speech, anti-gatekeeping, permissionlessness and inclusiveness, at its core.

For one, the author pointed out that Opensea NFTs are stored on the Google Cloud Platform, one of those trillion dollar monopolies.

Proof of stake means the largest stakeholders can unilaterally reject transactions. Technically the chain could fork. Practically, convincing everyone to move to a new chain seems about as difficult as everyone moving off Facebook because a few people get banned.

Proof of work means the richest people can afford more miners and completely control the chain.

So where is the decentralization? The only realistic decentralization I can make out is that its possible to build alternative chains, but that very thing is possible today. Its possible to build an alternate payment processor or social network if Visa bans your business, the really hard part is building it and getting the entire ecosystem to actually use it.

Re: Web3 is centralized

#37

The main issue with "Web3" is that it moves records of transactions from many private places to one public place. Sure this one place may not be controlled by a single entity, but it facilitates tracking at an unprecedented level. Cryptocurrencies are the ultimate example of this and are an absolute boon to tax collectors, forensic accountants and fraudsters. In our current economy financial transactions are recorded…

So if I don't trust Big Tech, I'm somehow supposed to trust groups of sketchy people who do things like give up their US citizenship (as an immigrant to the USA - the privilege is real) to move to {insert sketchy country or a known haven for certain activities - its legal there!} so they can now facilitate millions of dollars moving each day outside of any government jurisdiction.

Re: Web3 is centralized

#38
post #3

My main concerns with Web3 are that it is "pay to play" in many aspects and it's less democratic than the existing Internet.

> My main concerns with Web3 are that it is "pay to play" in many aspects and it's less democratic than the existing Internet.

You could say that Web3 is WebBourgeoisie.

Re: Web3 is centralized

#39
post #22

It's amazing how much I can read about web3 and still be confused as to what problems it solves.

It solves the urgent problem of the terrible scarcity of venues for financial speculation in an era of low interest rates and almost 0% real interest rates.

The economist Paul Krugman said that the cryptocurrencies had some of the same ballistics as gold, and gold does well when real interest rates are low, as people lack profitable investment opportunities and so they must seek increasingly aggressive and risky investments.

The cryptocurrencies have the advantage over gold that they can claim to not be gold, nor any known thing, they can claim to be something completely new, with unknown dynamics. This allows for a certain amount of hype that simply wouldn't be possible for gold.

And of course, in terms of ease of moving it around the planet, cryptocurrencies have some real advantages over gold, and therefore are probably stealing a lot of the risk taking that might have otherwise gone to gold.

Re: Web3 is centralized

#40

The main issue with "Web3" is that it moves records of transactions from many private places to one public place. Sure this one place may not be controlled by a single entity, but it facilitates tracking at an unprecedented level. Cryptocurrencies are the ultimate example of this and are an absolute boon to tax collectors, forensic accountants and fraudsters. In our current economy financial transactions are recorded…

I think of it as centralization in that all transactions will be stored in one “database”, but decentralized in that the database has millions of nodes and anyone can add their hardware as a node

That's centralization, just replicated for redundancy.
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