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In defense of cryptocurrency

blog.cryptographyengineering.com

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Re: In defense of cryptocurrency

#171

Post by shreyshnaccount »

dcolkitt wrote: post #127
JackC wrote: post #98

"transaction reversibility is not about the ledger, but rather about the transaction rules that a currency uses. A reversible currency requires that someone anoint this trusted party (or trusted parties) and that they use their powers to freeze/burn/transact currency in ways that are at odds with the recorded owners’ intentions. And indeed, this is a capability that many tokens now possess" I think this is arguing th…

Many real world systems are "nearly trustless". Of course you still need some sort of court system if someone decides to break bad. But in the 99%+ of times you're in the happy path, economic transactions occur based on autonomous rules encoded in software. The analogy I like to use is what's harder to buy a $1 million house or $1 million of Microsoft stock? The former process takes weeks, and dozens of man hours fro…

Makes no sense. Microsoft stock and houses are very different. I can run an illegal alligator fighting ring in one and not the other.

Re: In defense of cryptocurrency

#172

Post by birracerveza »

strofcon wrote: post #148
Gatsky wrote: post #135

Earlier quoted context omitted.

Well your Mac is worth ‘something’ because of what people are willing to pay for it. It would be worthless to certain people, just as you find bitcoin worthless. What’s the difference?

No, the Mac is worth something in and of itself . It is a tool of productivity, entertainment, education, creation, etc. And, failing all of that, it's valuable for its parts. A bitcoin is an ID number pointing to pretend money. It has zero intrinsic value.

I'm sure that if someone were to gift you one Bitcoin you would not refuse it on the basis that it's just an ID number pointing to pretend money with zero intrinsic value, would you?

Re: In defense of cryptocurrency

#173

Post by x-complexity »

jolux wrote: post #53

The biggest problem I see with cryptocurrency is the transaction rate problem. It’s not like attempts haven’t already been made to solve it (Bitcoin Lightning), and Dr. Green fully admits that it’s not certain that any currently proposed changes can solve it either. How long is the world supposed to wait for reasonable transaction rates on this technology? If this is truly like the early internet, they should have va…

> The biggest problem I see with cryptocurrency is the transaction rate problem. (...) How long is the world supposed to wait for reasonable transaction rates on this technology?

The technology to do so already exists / is currently being developed via:

- Optimistic rollups (Arbitrum, Optimism)

- 0-knowledge rollups (zkSync 2.0 (in public testing), Loopring, Immutable X)

- sidechains (Polygon PoS, Fantom)

https://ethtps.info/ https://l2fees.info/

At worst, you'll only need to wait for a year or two to get sub-$0.10 transaction fees on the ETH rollups, as user adoption picks up. For me, I've been an active user of Polygon PoS & my transaction fees are often below $0.01, with the most being $0.05.

There're also scalability improvements that're currently in the works, such as EIP-4844 (Proto-Danksharding, partially named after one of the core contributors to the ETH protocol). It should be noted that this is placed in the backburner, as the move to PoS is more important.

https://www.eip4844.com/

https://eips.ethereum.org/EIPS/eip-4844

Re: In defense of cryptocurrency

#174

Post by everfree »

kelseyfrog wrote: post #63

This is a genuine question. Is there a defense of cryptocurrencies that doesn't follow the pattern of, "yes, that is indeed true, however here is an edge case or counterexample which either doesn't exist yet, or is not in wide use so it's not actually a problem"? Every article or comment defending cryptocurrencies has followed this pattern and it isn't convincing to me. I'd love to have my mind changed, but when ever…

I think it's a fair script to use against arguments of the form "cryptocurrencies will never amount to anything".

I would hazard to say that it's not the criticism of the current state of cryptocurrency that irks most of its proponents - most of them agree that it's not very useful currently.

However, it becomes problematic when you take that valid criticism of the technology's current state and use it to support the conclusion that the entire tech is a permanent dead end. That problematic reasoning is what this article's really speaking out against.

If you want your mind changed that cryptocurrency is currently useful, I can't help you there. But if you want your mind changed that many of the drawbacks of blockchain technology are not as insurmountable as detractors would have you believe, the article does a good job of laying out points in favor of that.

Re: In defense of cryptocurrency

#175

Post by yata69420 »

Nursie wrote: post #150
dcolkitt wrote: post #127

Earlier quoted context omitted.

Many real world systems are "nearly trustless". Of course you still need some sort of court system if someone decides to break bad. But in the 99%+ of times you're in the happy path, economic transactions occur based on autonomous rules encoded in software. The analogy I like to use is what's harder to buy a $1 million house or $1 million of Microsoft stock? The former process takes weeks, and dozens of man hours fro…

As with many proposed blockchain solutions - what's important there is that you've wrapped everything in a legal vehicle that makes fast transfer possible, NOT the fact that the record sits on a blockchain. That record could sit anywhere. A database perhaps. It's not really the NFT that's the 'win' there, if indeed it is a win.

You'd need some kind of shared database that all parties can trust. It'd have to be regularly audited but also kept as up to date as possible. It should have very precise access controls. Also, it should be as fast as possible, and there should be a record of everything that's ever changed. If you want a full copy of it, you should be able to request it at any time.

It sounds like a lot of work to build that though.

Maybe we can find some nerds to make it for "equity" on the chance that such a database has value? They could use it for other stuff too if they want.

Re: In defense of cryptocurrency

#176

Post by Ologn »

strofcon wrote: post #148
Gatsky wrote: post #135

Earlier quoted context omitted.

Well your Mac is worth ‘something’ because of what people are willing to pay for it. It would be worthless to certain people, just as you find bitcoin worthless. What’s the difference?

No, the Mac is worth something in and of itself . It is a tool of productivity, entertainment, education, creation, etc. And, failing all of that, it's valuable for its parts. A bitcoin is an ID number pointing to pretend money. It has zero intrinsic value.

Correct, I can exchange a Mac for something else, or I can use it. Bitcoins are obviously exchanged but have not use.

Re: In defense of cryptocurrency

#177

Post by landemva »

adgjlsfhk1 wrote: post #160
lordofgibbons wrote: post #155

Earlier quoted context omitted.

>As soon as you have a trusted central authority You might have missed the entire point of cryptocurrency. The idea is that it is not centralized and a single entity can't "reverse" transactions.

That works great except for the fact that 99% of crypto trades occur through exchanges which just put you back to the worst of both worlds.

>> 99% of crypto trades occur through exchanges

Do you mean 99% of transactions occur on centralized exchanges without going on-chain? I would like to see the numbers you are using.

Re: In defense of cryptocurrency

#178

Post by lmm »

denkmoon wrote: post #161
adgjlsfhk1 wrote: post #160

Earlier quoted context omitted.

That works great except for the fact that 99% of crypto trades occur through exchanges which just put you back to the worst of both worlds.

If 99% of users stuck their fork in their eyeball, it wouldn't mean that a Fork is a bad design or a bad implement, it would mean that the users are using it wrong. FWIW, in my own usage of crypto, the lack of central authority is exactly why it is used. I don't really care that other people are just hodl-ing their funny money in someone else's wallet. Crypto, outside of an exchange, means I can send money to anyone…

> If 99% of users stuck their fork in their eyeball, it wouldn't mean that a Fork is a bad design or a bad implement

Yes it would.

Re: In defense of cryptocurrency

#179

Post by denkmoon »

lmm wrote: post #178
denkmoon wrote: post #161

Earlier quoted context omitted.

If 99% of users stuck their fork in their eyeball, it wouldn't mean that a Fork is a bad design or a bad implement, it would mean that the users are using it wrong. FWIW, in my own usage of crypto, the lack of central authority is exactly why it is used. I don't really care that other people are just hodl-ing their funny money in someone else's wallet. Crypto, outside of an exchange, means I can send money to anyone…

> If 99% of users stuck their fork in their eyeball, it wouldn't mean that a Fork is a bad design or a bad implement Yes it would.

Your task, if you choose to accept it, is to redesign Fork to prevent user-eyeball interaction.

Re: In defense of cryptocurrency

#180

Post by Nursie »

yata69420 wrote: post #175
Nursie wrote: post #150

Earlier quoted context omitted.

As with many proposed blockchain solutions - what's important there is that you've wrapped everything in a legal vehicle that makes fast transfer possible, NOT the fact that the record sits on a blockchain. That record could sit anywhere. A database perhaps. It's not really the NFT that's the 'win' there, if indeed it is a win.

You'd need some kind of shared database that all parties can trust. It'd have to be regularly audited but also kept as up to date as possible. It should have very precise access controls. Also, it should be as fast as possible, and there should be a record of everything that's ever changed. If you want a full copy of it, you should be able to request it at any time. It sounds like a lot of work to build that though.…

> You'd need some kind of shared database that all parties can trust

Government run then, the institution that is involved with contract oversight here, an easily identifiable authority in this situation. If you don't trust that here, then there's no point in bothering with sales contracts in the first place.

> It'd have to be regularly audited but also kept as up to date as possible. It should have very precise access controls. Also, it should be as fast as possible, and there should be a record of everything that's ever changed. If you want a full copy of it, you should be able to request it at any time.

So like a database with auditing switched on? The type that is already run all over the world for all sorts of things?

> If you want a full copy of it, you should be able to request it at any time.

Like a database that offloads snapshots every so often? And maybe has an API in front of it allowing querying of public data? Like are run ... everywhere? For all sorts of things already?

> It sounds like a lot of work to build that though.

I mean, it sounds exactly like a ton of running systems with fairly standard options, so no, it seems like it would be fairly trivial.

And of course we all know that there are no development costs for blockchain solutions. Nobody needs to build a webpage, or develop smart contracts, or security audit them, or build in permission systems so there can be authority oversight, or provide APIs, no, they all just appear fully formed and fully secure out of the ether... no boring 'work' to build that!

"Blockchain gives you that for free" must be one of the biggest fallacies out there.

> Maybe we can find some nerds to make it for "equity" on the chance that such a database has value?

Doesn't sound to me like we need to give these 'nerds' a continuing stake in a public service. Any old software company can build that sort of thing out for you for a one-off fee. Adding profit motives for unrelated third parties seems to me like a pretty poor choice. But what do I know, perhaps we should introduce more avenues for speculation around the housing market, that sounds healthy.

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