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Crypto is an unproductive bubble

alexkolchinski.com

471–480 of 539 posts

Re: Crypto is an unproductive bubble

#471
post #337
post #320

Earlier quoted context omitted.

You're comparing a centralized approach with the force of law to a decentralized approach which requires buy-in by the masses without any coercion. Of course the two approaches will be different.

TCP/IP was standardized in 1983. Nine years later I had an email address. Two years later I had full IP access (telnet, Usenet, ftp, web). I never stopped using it, even though specific protocols like ftp faded away. In contrast, I bought some cryptos five years ago and dabbled in Solidity too, but there was just nothing to do with it because it’s so clunky and wasteful. I don’t expect to ever touch that stuff again.…

“Clunky” crypto resonates perfectly with me. I spent a couple weekends reading up on bitcoin and ethereum, working through a couple simple blockchains implementations, and getting familiar with building for web3. I found the development experience severely lacking. Clunky.

Maybe blockchains tech will graduate beyond coins, NFTs, speculation, and rug-pulls. I look forward to that day. However, over a decade in, everything about cryptocurrencies and blockchain tech, from development to application, deployment and function, feels clunky.

Re: Crypto is an unproductive bubble

#472

Earlier quoted context omitted.

If enough members of society disagree with the terms of the contract, they may vote in representatives who change those terms, or alternatively they may revolt and install new representatives that way (see e.g. the French Revolution, American Revolution or Arab Spring). If you instead hold the view that _every single individual_ should be able to opt out of the contract (i.e. should be able to choose not to be subjec…

You just gave me your story again, you being able to repeat it has nothing to do with QED. For the individual there is no contract and no consensus, you just said so. For the individual its do as you are told at the threat of violence. Differently put, you just repeated a story which with you justify forcing other individuals around. You not liking this framing doesnt change that. edit: I am not repeating myself for…

My initial comment, which (I think) we have been debating thus far, stated "If you take this argument to its logical conclusion, anarchism is the only form of free government."

It seems that we are in agreement on this point?

If so, I'm really not sure on which point you're disagreeing with me (with a healthy amount of sneering, nonetheless, which I might remind you is against HN guidelines).

Is it that the term 'social contract' offends you? You may also replace 'contract' with 'flubbitz' in my argument; the argument still holds. I used the term 'social contract' because it's a well-understood term in the English language ('high school level' according to Dictionary.com).

Re: Crypto is an unproductive bubble

#473

Earlier quoted context omitted.

I can buy drugs and apparently some food deliveries. I get your point but thats just a question of adaptation. To the other point, i described the mechanism of adaptation. If the current mechanism of transfer stops working people historically fall back to anything else that works. They have to use something, trade must go on so they choose the next best thing till something better emerges. The involuntary pressure on…

> I can buy drugs and apparently some food deliveries. It's not completely clear to me that Bitcoin would even work for drugs or ransomware if those people weren't then converting Bitcoin into local currencies. This argument really undervalues the role that exchanges play in this process. I can earn a dollar, spend it on something, and the person I give it to as payment can spend that same dollar somewhere else. It n…

One is force (as in there being a threat if you dont comply) to hold a devaluing currency (devaluing due to the loss of trust that made the threat necessary) the other is having to use something as an transfer medium because you need any.

It might boil down to the same in the big picture (people having to use it) but people react differently in the two described situations. One is somebody trying to tax you through inflation, one is using something that is tiresome to use. You will be a lot more motivated to find an alternative for the former then the later.

To the other point, bitcoin being exchanged into other currencies is caused in the expectation of what will in the future be exchangeable for goods and services. IE Adaption. At the end of the day its the transfer of credit. Me paying the supermarket in fiat doesnt speak for an intrinsic value in the pieces of paper, but the expectation, that i worked for those tokens in the past or promised to work for them in the future. Thats all currencies are, what we use is determined by force (government pressure), ease of use and adaption.

I hope we are not talking in circles here, i am trying to get across that its important to look at what actually drives peoples behavior.

1) Inflation is inflation expectation, which just means a loss of trust. You expect to get less for it in the future and if everyone does, it happens.

1a) No individual wants to hold their savings in devaluing stores of value. There is a fear of value loss that drives behavior and Greshams law sets in

1b) Nobody wants to produce for a loss. If you pay more then you can expect to get, you might not do it if you are not allowed to raise prices.

1c) Forcing people to accept it (ie price dictates) doesnt really work, see 1b.

2) You need some transfer medium. Our economy works by me having worked or having promised to work for what i buy in the supermarket. Just because one currencies is buged or exploited doesnt mean i no longer have to buy stuff. Adaption is then driven by market chains. I pay the supermarket in those tokens they pay their suppliers who they in turn can exchange for what they need. Those tokens are generally the ones the government wants for taxes and forces people to use, but if governments fuck up to badly, people still have to eat. Same story over and over again.

Currencies are a con game. They are the best thing we have to keep tab of who gets what in what we produce daily. If it gets exploited (me promising to work in the future every day in the supermarket while never doing it), people tend to realize that sooner or later. If you cant cut off the individual doing it the currency gets devalued over time which triggers psychological effects. Modern monetary theory is the assumption that while you cant force people to use it, it wont devalue if people have no other store of value to flee into. I think thats very optimistic if you look at stock prices (another store of value with even less practicality for daily exchange).

At the end of the day, all crypto needs to be is something any market chain can fall back on once the current one is broken so baldy that the chain halts. (Producers stopping to produce)

Governments trying to ban exchanges falls into the same category as dictating that a farmer has to accept fiat for his stuff. If its not profitable, the farmer will stop and i will still have to eat. Adoption of literally any other functioning store of value then gets forced Which leads us to the second theory behind modern monetary theory. That we are technologically far enough to prevent off book transactions. Which would however still trigger the dont produce for a loss part.

In short, printing money wont work forever, as it only works as long as people believe it to. That sets a mechanism in motion that requires another means of exchange. Who ever has something working will get the job to keep the economy running. All crypto have to be is less bad then trust people have in the governments ability to manage the currency.

Re: Crypto is an unproductive bubble

#474

Earlier quoted context omitted.

> The fact that fiat is moving towards 10% inflation Crypto had value swings far greater than that in the past 6 months alone.

But not over time. Fiat has been constantly going down since its inception

Slow inflation is manageable for an average person (or a company). Wild swings at any given point are not.

Re: Crypto is an unproductive bubble

#475

Earlier quoted context omitted.

You just gave me your story again, you being able to repeat it has nothing to do with QED. For the individual there is no contract and no consensus, you just said so. For the individual its do as you are told at the threat of violence. Differently put, you just repeated a story which with you justify forcing other individuals around. You not liking this framing doesnt change that. edit: I am not repeating myself for…

My initial comment, which (I think) we have been debating thus far, stated "If you take this argument to its logical conclusion, anarchism is the only form of free government." It seems that we are in agreement on this point? If so, I'm really not sure on which point you're disagreeing with me (with a healthy amount of sneering, nonetheless, which I might remind you is against HN guidelines). Is it that the term 'soc…

I am sorry if it read as sneering, i tend to loose track of people identifying with the positions, i hoped to make the error in perspective better visible.

You argument is that my assertion cant be true because it would mean Anarchism to be the only form of government.

I think this is intellectually dishonest, you dont end up at it as a logical conclusion, after all, there are some practical problems with Anarchism that dont just disappear. If i had to guess why you might think this, it might be caused by you wanting to look favorably on your worldview? (no offense intended, its an honest guess that might help to self reflect)

The description of reality is however absolutely unrelated to the implications drawn from it. Just because you think there is a logical conclusion doesnt change the basic facts and i think we should communicate them plainly. Because doing so might show errors in what conclusions you drew from it.

My initial statement is true unrelated to its implications. I tried getting away from the individual vocabulary to the meaning behind it so we dont get hung up on the wording.

What you describe here (yes i heard of societal contracts before) is the justification of why this is a good and necessary flubbitz. I point out that this is a bit dishonest, because on paper the Flubbitz you describe is a lot closer to slavery then to a consensual contract. You just think its necessary because of (story + implications) which makes your use a common but dishonest frame. You could make a good argument, that "Good and necessary type of slavery" is an equally fitting description, after all, you agree that it entails not giving individuals a choice and forcing them to comply by force. We by no means have to agree on it being slavery but think about the structure we exist in. So:

Statement 1, calling that a consensual contract is a frame aimed at making it more palpable because of (implications + intentions). It is still forcing individuals to do something they never had the chance to disagree with

Your answer to this is repeating the intentions and implications you see. You dont disagree over the basics, just argue that it is necessary.

All of the above might be seen as just an annoying attempt of smearing a righteous worldview. However, my argument is that this dishonesty has substantial implications. Namely

Statement 2, the wording of the contract being quite broad and exploitable. Not just are you stuck in a good Flubbitz, there exist a power structure that has the ability to redefine its terms how it sees fit.

Saying that this would would mean we had to start anarchism is no different then saying due to problems with capitalism we now have to start communism. The problems still exist and have to be dealt with them. Sugarcoating to feel better about a bad situation is counterproductive. Politics is an ugly business, maybe we should think about where the terms of the Flubbitz get interpreted to broadly, no? After all, its not as cuddly and innocent as it sounds.

Re: Crypto is an unproductive bubble

#476
post #374

Earlier quoted context omitted.

I can’t understand how anyone has any confidence in crypto after the current Ukraine/Russia situation. I thought that crypto was decentralized and no-one could place restrictions on who could own it, and what they could do with it. This also turned out to be total BS as Russian crypto accounts keep getting frozen. Funnily enough, I haven’t heard the “crypto community” make a single peep about this. Hilarious..

> I can’t understand how anyone has any confidence in crypto after the current Ukraine/Russia situation. I thought that crypto was decentralized and no-one could place restrictions on who could own it, and what they could do with it. You do realize that their are capital controls self-imposed by the Ukrainian National Bank, right? And that Bitcoin has been legalized in Ukraine [0] after the influx of Bitcoin donation…

> So, all I have been able to gather from all of this is that YC/HN remains incredibly ignorant of what Bitcoin and crypto avails, and will draw conclusions based more on that ignorance then take the time to actually look into what is actually taking place.

And yet, you people think crypto is seriously going to "catch on" for the average person? I'm sorry, but "you need a certain IQ to understand Rick and M- I mean crypto!" isn't going to magically make crypto useful at all. The fact that crypto people have to go into long tirades full of technical jargon just to answer the question "Why?" tells the whole story.

Re: Crypto is an unproductive bubble

#477
post #52

Earlier quoted context omitted.

That is circular reasoning. Bitcoin is also a collectable, with a fixed number of them (21 million) out there to collect. Every investment we are talking about is only rare because the community that participates in it has decided they are rare. Otherwise there is nothing stopping me from taking a picture of a piece of art or trading card and reproducing it a million times.

> Bitcoin is also a collectable, with a fixed number of them (21 million) out there to collect. Bitcoin is fungible, unlike collectibles. There is no value to holding one bitcoin vs another, if "different bitcoins" even makes sense as a concept. It can also be subdivided, so it is more accurate to say that there are 21 trillion units that will be out there.

Gold is also fungible, as is any physical or virtual currency, water, oil, any sneaker run, a collectible figure from a video game. Non-fungibility is not a requirement for value.

Re: Crypto is an unproductive bubble

#478
post #113

Earlier quoted context omitted.

This is a problem (if you consider it as such) that smart contracts intend to solve. For example, in the smart contract introduce some authorities that are allowed to block and revoke transactions for some time (if the block chain has no support for certified timestamps, use "number of new blocks mined and appended to the blockchain" as substitute). Let the market decide what kind of protection stakeholders prefer.

This hinges on the contracts actually working as intended, which is something they often do not. Code in general rarely does poorly in that regard. It's really hard to consider every contingency beforehand. Unknown unknowns and all that.

> This hinges on the contracts actually working as intended, which is something they often do not. Code in general rarely does poorly in that regard.

Exactly the same can be said about the legal system. People are just a lot more used to the many existing "glitches" of the legal system in comparison to "bugs" in smart contracts.

Re: Crypto is an unproductive bubble

#479
post #286

I think you're missing a lot of information from your article and your thinking. The creative limits of a new organizational strategy for information are nonexistent. That is, when the vacuum-tube was invented, no one foresaw the integrated circuit. When the personal computer was made possible, no one really foresaw the internet. When the internet was spawned, nobody really foresaw large companies dominating the ment…

It's been 13 years. How long would we wait before we declare it unproductive?

1904 Vacuum-Tube invented

1961 IC invented

1974 personal computer

1983 internet

1998 g

2004 f

On average 20.6 years between the innovations I listed. Consider that since the inception of BTC (and ETH) there might not have been any actual innovations that would fit this rubric.

Re: Crypto is an unproductive bubble

#480
post #113

Earlier quoted context omitted.

This is a problem (if you consider it as such) that smart contracts intend to solve. For example, in the smart contract introduce some authorities that are allowed to block and revoke transactions for some time (if the block chain has no support for certified timestamps, use "number of new blocks mined and appended to the blockchain" as substitute). Let the market decide what kind of protection stakeholders prefer.

"Smart contracts" are neither smart nor are they contracts. It's a piece of code written in an esoteric programming language that even people who are experts in have trouble understanding and spotting errors in. Compared to actual contracts which are human readable.

> Compared to actual contracts which are human readable.

People are just more used to and exposed to texts written in, say, Englisch in comparison to code written in, say, Solidity.

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