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The Edited Latecomer’s Guide to Crypto

mollywhite.net

231–240 of 331 posts

Re: The Edited Latecomer’s Guide to Crypto

#231
post #36

Until someone has built a crypto product that creates values (for the purpose of this discussion it can be a good or a service would be willing to spend USD on even if it wasn't a crypto) crypto is a negative-sum game. Any USD taken out of the system someone else has to have put in, plus whatever the miners take out. Fortunes aren't created, they are redistributed.

While partly true, that is true of any asset (dollars in/dollars out). However your statement that fortunes are not created, they are redistributed is incorrect. The value is not a 1 to 1 relationship with inflows. The value is based on supply/demand. If demand outstrips supply, value goes up regardless of how much $ is flowing in or out. You can see large price swings even on days with low volume.

No, when I invested 100k₹ in my brother's shop, it was able to turn a profit in a few years and pay me back with interest. The money came from selling products and generating revenue. With Bitcoin there is no revenue. The only way you can turn a profit is if you get some other greater fool to buy it from you. This is how most ponzi schemes work.

I find it very scary that the people investing in crypto don't even understand the basics of investment. They genuinely think that all investment follows ponzinomics.

Re: The Edited Latecomer’s Guide to Crypto

#232

Earlier quoted context omitted.

Using NFTs for generating concert tickets or supply chain logistics & tracking seems like it could be economically viable. I'd bet the biggest use case for NFTs at present is money laundering. It's hard to imagine someone having the talent to acquire $800,000 yet still being gullible enough to spend it all on a hyperlink of a hand drawn monkey with the expectation that they bought an appreciable asset.

The whole point of NFTs is that they are decentralised. If you are going to a concert, you are by definition centralizing power in the hands of the organizer, making NFTs entirely pointless for this. You might as well have the concert organizer send out emails with ticket numbers. Supply chain I am not even sure why you would want it. NFTs don't prevent false data being input into the system. it only "protects" again…

Except in your concert example, the number of tickets is not verifiably public with a centralised entity. There is nothing that stops the organizer from printing more tickets than there exists capacity for. On the flip side, a NFT ticket can be demonstratably unique (no counterfeiting or luck of the draw from scalpers), and only a certain number can be printed (otherwise everyone will know that the organizer is not acting legitimately).

As digital entities, a door is also opened for various interactive / programatic ways of using said tickets that are not possible with a private database and lack of incentive to improve the status quo (Most of the established incumbents have had years to improve, but don't until threatened by an emerging technology).

Another example off the top of my head:

* An anti-scalper lottery where a portion of the tickets are reserved for accounts that have owned a previous ticket for an event in the last twelve months during the run-time of said event. Let's say 80% of the ticket pool, and the remaining 20% is the free-for-all and any unsold tickets are sold free-for-all as well for the last week before the event starts.

Re: The Edited Latecomer’s Guide to Crypto

#233

Earlier quoted context omitted.

While partly true, that is true of any asset (dollars in/dollars out). However your statement that fortunes are not created, they are redistributed is incorrect. The value is not a 1 to 1 relationship with inflows. The value is based on supply/demand. If demand outstrips supply, value goes up regardless of how much $ is flowing in or out. You can see large price swings even on days with low volume.

No, when I invested 100k₹ in my brother's shop, it was able to turn a profit in a few years and pay me back with interest. The money came from selling products and generating revenue. With Bitcoin there is no revenue. The only way you can turn a profit is if you get some other greater fool to buy it from you. This is how most ponzi schemes work. I find it very scary that the people investing in crypto don't even unde…

[deleted]

Re: The Edited Latecomer’s Guide to Crypto

#234
post #226

Earlier quoted context omitted.

People always say the same thing when someone is critical of crypto. Its too early! I mean after all, we are only 13 years in. Or: there is a lot of bullshit but the interesting things are outside of your echo chamber. But then never link to such counter examples. At best people talk about filecoin, which does pass the bar of not being a literal scam, but still makes no sense from a product-market fit (storage has 3…

https://www.coindesk.com/business/2022/03/09/ukraine-has-rec... This happened primarily in a matter of hours. In cash. Across borders. Without being subject to sanctions or restrictions by any country. It may not be your use case, but it has definitely "put up".

PayPal and bank wire transfers still work in Ukraine, so this not a particularly good example of a crypto use case.

Russian hackers demanding ransom payments in bitcoin—thereby circumventing economic sanctions—now that is a legitimately illegitimate use case for crypto.

Re: The Edited Latecomer’s Guide to Crypto

#235

Earlier quoted context omitted.

The whole point of NFTs is that they are decentralised. If you are going to a concert, you are by definition centralizing power in the hands of the organizer, making NFTs entirely pointless for this. You might as well have the concert organizer send out emails with ticket numbers. Supply chain I am not even sure why you would want it. NFTs don't prevent false data being input into the system. it only "protects" again…

Except in your concert example, the number of tickets is not verifiably public with a centralised entity. There is nothing that stops the organizer from printing more tickets than there exists capacity for. On the flip side, a NFT ticket can be demonstratably unique (no counterfeiting or luck of the draw from scalpers), and only a certain number can be printed (otherwise everyone will know that the organizer is not a…

Again, none of this matters because the whole thing is ultimately centralized in the hands of the organizer. Nothing stops him from printing 100 tickets on VET, and then turning around and printing 10000 tickets normally.

> otherwise everyone will know that the organizer is not acting legitimately

Because this has clearly stopped serial rugpullers like Jake Paul. People no longer invest in the NFT projects that he shills right?

And also there is nothing wrong with overbooking, because at least a few people are going to no-show. If the organizer is not able to accommodate you, you are given a refund.

This anti scalping tech is not even related to crypto currency. It can be implemented even more easily in a normal ticketing system with KYC. The fact that people don't do it is proof that it is easily defeated. With non KYC crypto accounts, the accounts themselves could be traded, making any account based tech pointless.

Finally, most of this is so niche that I have doubts that even if all this was true, it still wouldn't result in something successful.

Re: The Edited Latecomer’s Guide to Crypto

#236
post #228
post #226

Earlier quoted context omitted.

https://www.coindesk.com/business/2022/03/09/ukraine-has-rec... This happened primarily in a matter of hours. In cash. Across borders. Without being subject to sanctions or restrictions by any country. It may not be your use case, but it has definitely "put up".

It obviously isn't cash, it isn't even money - that's the reason the amount received is stated in something else, namely dollars, which this has to be exchanged into to be useful. What happened here is a wire transfer, not different from me sending money from my bank account to someone else bank account. Just with two additional transformation steps (make money into whatever crypto, make whatever crypto back into mon…

It is very different than you sending money via an intermediary bank.

I dare you to describe a method of wire transfer to Kyiv that works in that quantity and timescale and is practically usable by the recipient that quickly and cannot be blocked by your local government's policies.

There simply isn't anything close to that. People that think that this is the same as a wire via a regulated bank are ignorant of the specifics of each type of payment.

Cryptocurrency is indeed cash, and is useful the same way cash is useful.

Re: The Edited Latecomer’s Guide to Crypto

#237
post #226

Earlier quoted context omitted.

https://www.coindesk.com/business/2022/03/09/ukraine-has-rec... This happened primarily in a matter of hours. In cash. Across borders. Without being subject to sanctions or restrictions by any country. It may not be your use case, but it has definitely "put up".

PayPal and bank wire transfers still work in Ukraine, so this not a particularly good example of a crypto use case. Russian hackers demanding ransom payments in bitcoin—thereby circumventing economic sanctions—now that is a legitimately illegitimate use case for crypto.

Try sending PayPal from Russia to Ukraine.

PayPal requires identity and permission. I am barred from using it, for example.

No barriers to me donating to Ukraine via cryptocurrency.

Re: The Edited Latecomer’s Guide to Crypto

#238
post #120

The issue with crypto is that reasonable use cases are early, and don’t attract attention except for niche communities. There’s a few big ones, for example, filecoin right now has created a commodity market for storage that is currently 10,000 cheaper than S3 in some instances. (See file.app for stats) But realistically, the interesting projects are very small and hard to find. However, scams and ponzi schemes, by th…

People always say the same thing when someone is critical of crypto. Its too early! I mean after all, we are only 13 years in. Or: there is a lot of bullshit but the interesting things are outside of your echo chamber. But then never link to such counter examples. At best people talk about filecoin, which does pass the bar of not being a literal scam, but still makes no sense from a product-market fit (storage has 3…

> Its too early!

I think most critics of crypto come into the conversation with a "crypto is bad, and so I must find ways to reinforce this belief", and it's relatively obvious that the critic doesn't have the perquisite knowledge to craft a critique that can be responded to easily.

Specifically, a critic might say "the set A is bad". The critic is under the assumption that the set A is small, perhaps a few items, and they've seen the majority of them. But the "defender" knows that the set is hundreds of thousands of items, but still has only seen a few of them.

The critic operates under the assumption of maybe 4/5 items are bad, and the defender is operating under the assumption that 4/100,000,000 are bad.

So when a critic asks you to link to projects, there's a problem: even if the defender shows 100 projects, and the critic rejects all of them, then it doesn't change the defender's position, because 104/100,000,000 is still a small survey.

Sane "defenders" don't need to disagree with the critics on their points. They can differ primarily in seeing a much, much larger, unexplored search space.

If you assume the space has been fully searched, then its safe to stand back and critique. However, many folks conducting the search see much farther than you do, and see the entirely unexplored space as quite large. And so, it’s reasonable for the defender to not want to engage in your risky position, that assumes snake eyes for the next 100,000 dice rolls.

If you see how large the unexplored search space is, then it sounds ridiculous to declare the entire thing “done and bad”. It’s the same reason why you may choose not to engage with the flat earther. It’s hard to engage with a position so disconnected from rationality.

That said, there’s plenty of people in crypto who are equally disconnected from reality, either because they too only see a small search space, and have declared the contents “good” with little examination, or because they see the large search space and assume all dice rolls will come up as 6’s.

Those folks tend to create a cycle. Folks with no opinion see crazy crypto person, and develop into their own crazy anti crypto person. Neither party is acting rational, because both have claimed certainty with extremely little working information.

That said, there's other projects that are worth while, here's some to add to your N:

- https://strangemood.org (decentralized competitor to steam; this is what I work on)

- https://www.helium.com (incentive layer for the LoRaWAN network)

- https://tea.xyz (new homebrew)

- https://handshake.org/ ("really" decentralized DNS)

- (Compound / Aave / Solend) (decentralized loans)

> still makes no sense from a product-market fit (storage has 3 metrics to judge by: price, retrieval latency, reliability. Filecoin is order of magnitudes worse than competitiors on all metrics)

We use Filecoin and IPFS and have found solutions to these issues typically, and are happy "customers". It's also worth noting that we _can't_ use S3, or traditional cloud hosting, which therefore adds a new metric for us to judge storage on: decentralization.

Re: The Edited Latecomer’s Guide to Crypto

#239

Earlier quoted context omitted.

A rational actor would never spend a deflationary currency since it would gain value as deflation happens. If everyone was rational, no money would ever change hands. You can’t have a functional monetary system without liquidity or exchanging of currency. Bitcoin is a deflationary currency (for now)

A rational actor will exchange money for food rather than starve to death, regardless of whether the currency they are using is deflationary or not. Your argument is nonsense.

That rational actor doesn't need to be a human. In fact, the concept of rational actor makes more sense in the context of corporations. Now, imagine a corporation hoards a trillion dollars worth of a deflationary currency. Will it invest it back to the economy as eagerly as it would an inflationary currency?

Re: The Edited Latecomer’s Guide to Crypto

#240
post #226

Earlier quoted context omitted.

People always say the same thing when someone is critical of crypto. Its too early! I mean after all, we are only 13 years in. Or: there is a lot of bullshit but the interesting things are outside of your echo chamber. But then never link to such counter examples. At best people talk about filecoin, which does pass the bar of not being a literal scam, but still makes no sense from a product-market fit (storage has 3…

https://www.coindesk.com/business/2022/03/09/ukraine-has-rec... This happened primarily in a matter of hours. In cash. Across borders. Without being subject to sanctions or restrictions by any country. It may not be your use case, but it has definitely "put up".

Fair enough - I actually do think bitcoin is the only use case of this crypto stuff that remotely makes sense. Its not without issue, but its passed the proof of concept stage into something sort of useful for some people.
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