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In defense of cryptocurrency

blog.cryptographyengineering.com

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Re: In defense of cryptocurrency

#331

Post by abirch »

what-the-grump wrote: post #144
abirch wrote: post #101

Earlier quoted context omitted.

The blockchain ownership may be flawed, just like the current paper one. That's why you'd still need title insurance. Sellers and buyers don't need agents right now. Thanks to Zillow, the price disparity is moot. I knew more than my past real estate agent when I purchased my current house (it was a corporate move or I wouldn't have used one.) Wire transfers should be instant and irreversible, that's why scammers use…

I’ve seen commercial banks reverse wire transfers within the first 30 days. When you are moving large sums of money between well known institutions the money is very illiquid, mostly to prevent mistakes, fraud, etc. It’s why most fraud that you hear about involves movement of money overseas or into another type of asset or more liquid form, e.g bills, physical goods etc. No one sits their stolen funds at chase bank……

Why didn't Citi reverse this wire?

https://www.bloomberg.com/opinion/articles/2021-02-17/citi-c...

Re: In defense of cryptocurrency

#332

Post by nicoburns »

yellowapple wrote: post #318
sime2009 wrote: post #260

Earlier quoted context omitted.

> It wouldn't be better "in every way", though. A blockchain is much more resilient; the equivalent would be to have hundreds or thousands of redundant SQL databases around the world and somehow keep them all in sync. Technically true, but also completely pointless. An organisation running an SQL database doesn't need hundreds or thousands of redundant SQL nodes/copies to reach the level of robustness required.

Indeed they don't, but even running two database servers (let alone more for e.g. geographic redundancy) is already more resource intensive than running a full node for a proof-of-stake blockchain. You might as well just run that node and get that resiliency basically for free. Not every usecase requires that sort of resiliency, of course, nor does every use case prioritize it above latency and throughput; nobody exc…

> running a full node for a proof-of-stake blockchain

Are there any extant proof-of-stake blockchains that achieve the security guarantees necessary to make a currency viable? Last I heard proof-of-stake was still a hypothetical idea, not something that someone had actually managed to make a working currency with, and that all of the cryptocurrencies in common use were still using proof-of-work (which is of course much more resource intensive).

Re: In defense of cryptocurrency

#333

Post by BiteCode_dev »

woodruffw wrote: post #146
BiteCode_dev wrote: post #84

Earlier quoted context omitted.

Depends. I buy electronics with my VISA card for thousands of dollar, and clients sometime prefer to pay my gigs with a card as well. Anything above 3000 will likely be cheaper using BTC. But I see your point.

The last time I transferred more than $3000, it cost me $0. I used ACH.

Sure, like SEPA in Europe.

Although you are probably going to use your card to buy this: https://www.apple.com/shop/buy-mac/pro-display-xdr

But again, I see your point: our financial system is already very efficient, BTC will have to be way better than it current is before it can compete with it for day to day use.

I'll keep an eye on lightning though. It makes any transaction, no matter the size, instant, and cost a tenth of a cent. It has potential.

Re: In defense of cryptocurrency

#334

Post by cy_overlord »

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…

The argument made was that it's not about the technology itself but the transaction rules. If money are stolen from banks in a specific way (withdrawn into prepaid cards), banks will not and cannot reverse these transactions. Banks do have some rules like chargeback however to reverse legitimate transactions or delayed transactions. The same rules can be converted into Smart Contracts which governs the transaction of a certain currency.

So instead of reversing, we could make all NFTs locked from trading for 3 days after transaction which anyone could appeal for a dispute and buyback the NFT for the same price anytime.

The challenge here is, can we actually come up a set of robust rules that is not too rigid yet not abusable. It's not easy, it won't be right off the bat and it certainly require a lot of critical, innovative thinking. And maybe the solution won't have to be complex at all.

Re: In defense of cryptocurrency

#335

Post by roenxi »

MomoXenosaga wrote: post #202
yata69420 wrote: post #190

Earlier quoted context omitted.

I suspect we have different governments. I don't see mine doing anything remotely like that. I come from a place that still has toll booths so that toll booth workers can keep their jobs. I have to take off my shoes before I can get on an airplane so that my government feels safer. I personally compute my government taxes, which only occasionally (if ever) get verified. That's how we fund the country. If I routinely…

This hatred for the government Americans have is frankly unhealthy. Besides replacing it with tech bros and crypto douchebags doesn't seem like much of an improvement.

> This hatred for the government Americans have is frankly unhealthy.

Governments, by design, are the most dangerous institution we have. In the 20th century they were a leading cause of death. Between the wars and communist policy a lot of people died. Fear of government is entirely sensible, we're more likely to be killed by a government than any serial killer.

And we don't know what the big wars of the 21st century will look like, but we may be about to find out.

Re: In defense of cryptocurrency

#336

Post by abirch »

adra wrote: post #116
abirch wrote: post #101

Earlier quoted context omitted.

The blockchain ownership may be flawed, just like the current paper one. That's why you'd still need title insurance. Sellers and buyers don't need agents right now. Thanks to Zillow, the price disparity is moot. I knew more than my past real estate agent when I purchased my current house (it was a corporate move or I wouldn't have used one.) Wire transfers should be instant and irreversible, that's why scammers use…

The receiving bank often takes holds on the funds until they are specifically cleared from the originator bank or a fixed holding period. In that time, you can still deduct the money if you had the cash previously available or maybe if you're in good standing with the bank (not entirely sure on this part, probably different per bank). The money is often frozen completely then returned to the defrauded party if caught…

The receiving bank can have a 7 day hold but that's not by design like a check (DDA) where there's a holding period and you can cancel payment.

Re: In defense of cryptocurrency

#337

Post by dale_glass »

nftbuy wrote: post #329
tsimionescu wrote: post #313

Earlier quoted context omitted.

None of your examples are good ideas though. DNS requires proof of identity and a mechanism for settling disputes (e.g. so you can't buy google.com if you're not named Google; and also can't buy g0ogle.com, gooogle.com, gOogle.com etc) to be a useful system. Minting NFTs simply can't give you that, and once you involve a party that can settle disputes, all advantages of NFTs disappear. Not to mention, most NFTs as us…

> DNS requires proof of identity and a mechanism for settling disputes Hah. Like giving Meta the ability to create legal disputes against long-standing companies that happen to share its new name. This is a system that rewards those with the funds to pay the legal fees, or settle disputes outside of court with large lump sums. Not all users want a system where Meta can take a domain you own simply because they now ha…

> Not all users want a system where Meta can take a domain you own simply because they now have a trademark that loosely correlates with it.

Agreed, yet the government won't care and will make sure enforcement happens anyway.

If your NFT based domain system is used by a dozen hardcore nerds, then nobody will care, sure.

But if it somehow managed to overtake DNS and become the de-facto standard, the government would just come up with a way to regulate it anyway. Eg, they'd demand that web browsers not implement ENS, or consult some sort of additional blacklist.

Re: In defense of cryptocurrency

#338

Post by jk7tarYZAQNpTQa »

strofcon wrote: post #163

Anyone notice how the author goes to great lengths to 'bold' the claims in the original letter that talk about how worthless the technology is - and then fails entirely to address those points? Letter: "Crypo rests on tech that is useless." Blogger: "I disagree, I think there are some fascinating things to be done with blockchain tech! Just... don't expect me to share them. You should DYOR." sigh

IMHO Matthew Green often makes bold yet unsubstantiated claims. He also creates and promotes FUD. He may be technically good, but I don't trust his personal opinion, not even on subjects he presumably knows very well.

Re: In defense of cryptocurrency

#339

Post by randomran01234 »

lbriner wrote: post #322
randomran01234 wrote: post #105

Earlier quoted context omitted.

And it is fine to build systems with trusted parties on top of a permissionless network. The article cites USDC which does this, it is one of many applications users can choose to transact with. Attempting to bake reversibility into the protocol would lead to a tightly permissioned system with only a few trusted authorities. A loose analogy might be the internet, which aims to be a decentralized global protocol that…

I'm not an expert but I think this is what the original letter authors objected to. If you build these mechanisms on top of a blockchain which is inherently baked in stone, then there is no point in having the blockchain be so strict. In other words, if you allow an organisation to change things like refund you, then they might as well just manage their own leger like they do at the minute.

The goal of modern crypto like Ethereum is to provide a secure, predictable, open source, and decentralized network that many higher-level applications can flourish on top of and co-exist within.

USDC exists with reversibility but not all users in the network are forced to use it. There are other protocols like DAI that have different features and considerations. And in many cases these are open source protocols that can be forked as desired.

Probably the closest thing we have like this is the web, which is more or less a decentralized protocol, atop which we have built a lot of centralized platforms.

Re: In defense of cryptocurrency

#340

Post by zby »

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…

The comparison of buying $1 million house or $1 million of Microsoft stock is a bit complicated - because in nearly all of the transactions you don't formally really buy the Microsoft stock. Here is Matt Levine quote:

""" Nobody owns stock. What you own is an entitlement to stock held for you by your broker. But your broker doesn't own the stock either. What your broker owns is an entitlement to stock held for it by Cede & Co., which is a nominee of the Depository Trust Company, which is a company that is in the business of owning everyone's stock for them. """

https://www.bloomberg.com/opinion/articles/2015-07-14/banks-...

Also: https://bitsonblocks.net/2019/02/07/who-legally-owns-all-the... compiles similar information on Singapore and Hongkong (googled - not verified).

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