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In defense of cryptocurrency

blog.cryptographyengineering.com

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Re: In defense of cryptocurrency

#421

Post by tiluha »

throw0101a wrote: post #395
astoor wrote: post #287

Earlier quoted context omitted.

Transaction irreversability is the whole point of the "peer to peer electronic cash system": "Commerce on the Internet has come to rely almost exclusively on financial institutions serving as trusted third parties to process electronic payments... cutting off the possibility for small casual transactions ... What is needed is an electronic payment system based on cryptographic proof instead of trust, allowing any two…

> allowing any two willing parties to transact directly And what happens if one of the parties is not willing? If someone's e-wallet gets broken into and funds are transferred? How does any current system handle that situation? A lot of folks consider irreversibility a feature, when there's a strong case to be made that it is a bug.

The system does not handle it. If that is a problem for you, then cryptocurrencies are not for you. In a way it's like cash. If your wallet is stolen, there is no easy way to get your money back.

Re: In defense of cryptocurrency

#422

Post by etherael »

sireat wrote: post #408
lumannnn wrote: post #390

Earlier quoted context omitted.

You probably should look at different numbers than just the dollar price. Number of nodes is rising, number of wallets is rising, number of hash-power is rising. Also, please look into the "Lightning Network". It's the second layer on top of Bitcoin and that's where the whole ecosystem scales (in terms of numbers of transactions per second). Cheap, scalable and fast transactions. Adoption is happening in many places.

I would be highly interested in finding a serious shop/commerce/ecommerc operation where Lighting Network is actually used. I check LN every 6 months or so and situation is not looking so great. As it was with Bitcoin itself in early 2010s the shops advertising crypto acceptance are doing it mostly for publicity/ideological reasons or actually have stopped existing. So I check: https://acceptlightning.com/map.html Ra…

> So where are the successful use cases that utilize Lighting Network?

It's been pretty successful as a sword to destroy the original value proposition of bitcoin.

Re: In defense of cryptocurrency

#423

Post by rufusroflpunch »

Disappointing article. Bitcoin IS the innovation. Its energy use will continue to grow for a while, but probably not by as much as alarmists think. In return, you get digital property that can't be debased, corroded, eroded, confiscated or corrupted. Not to mention it's fungible, transportable, custodial, so it can be used as money. It's also completely trustless. You don't need anyone's permission to send value to anyone else.

Other cryptocurrencies are experiments in changing Bitcoin in ways that:

1) Are not enough of an improvement to break Bitcoin's network effects (Monero, Litecoin, etc).

2) Change the consensus rules so much that it ruins the incentives and wildly increases complexity and attack space (Proof of Stake blockchains).

We haven't even come close to unlocking the value of the Bitcoin innovation. Thankfully, short-sighted articles like this won't be enough to stop it.

Re: In defense of cryptocurrency

#424

Post by Aunche »

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…

Microsoft teams of lawyers, accountants, and regulators ensure that Microsoft is indeed worth what investors think it is. If you want to transfer your house, you need to do due diligence to do the same.

Re: In defense of cryptocurrency

#425

Post by Nursie »

lamontcg wrote: post #182
mirceal wrote: post #137

Earlier quoted context omitted.

That's not true. Think about the 3rd party as an escrow, not the bank. You wouldn't eliminate the escrow when you're buying a house, would you?

What's the fundamental difference between VISA, an escrow agent and a bank? Isn't VISA just an escrow agent between every transaction who also lends money and charges interest to the purchaser?

Visa is none of those things, it's a payments network. It doesn't lend money, it doesn't charge interest.

You card issuer, which is usually a bank, lends the money and deals with the account.

Re: In defense of cryptocurrency

#426

Post by JumpCrisscross »

DebtDeflation wrote: post #359
astoor wrote: post #287

Earlier quoted context omitted.

Transaction irreversability is the whole point of the "peer to peer electronic cash system": "Commerce on the Internet has come to rely almost exclusively on financial institutions serving as trusted third parties to process electronic payments... cutting off the possibility for small casual transactions ... What is needed is an electronic payment system based on cryptographic proof instead of trust, allowing any two…

>It is now used primarily for large transactions No it's not. It's now used primarily as a vehicle for speculation.

> It's now used primarily as a vehicle for speculation

Gambling. It’s gambling. A significant fraction of the American economy continues to gear towards gambling. Whether it be short-term dopamine hits from ad-fuelled social media or trading crypto, it’s a similar pattern of decay across a common although growing demographic stripe.

Re: In defense of cryptocurrency

#427

Post by [deleted] »

once_inc wrote: post #371
ninkendo wrote: post #353

Earlier quoted context omitted.

The base layer is melting the planet, for one thing.

Bitcoin mining isn't melting the planet. It's not even using more energy than Christmas lights or wash dryers. The comparisons made with [insert random country here] is dumb, because any worldwide phenomenon has a large chance to use more energy than [insert same random country here]. Even if the base layer of Bitcoin is using energy, one can argue that the functionality it offers (trustless, borderless, permissionle…

[deleted]

Re: In defense of cryptocurrency

#428

Post by GTP »

cy_overlord wrote: post #410
GTP wrote: post #376

Earlier quoted context omitted.

The problem that I see here, is that with the "code is law" approach if there's a bug in the smart contract that is supposed to protect you then you're screwed without recourse. In a traditional system, if there is a bug in your bank's software that makes you loose money, you can ask the bank to give you the money back. If they refuse, you can take them to court. If instead the smart contract has a bug, there's no on…

"you can ask the bank to give you the money back" "you can take them to court" Which like the article argues, is not something that can be solved by any ledger, distributed or not. Even if banks reverses records, they don't change the data which is already on the database/record, instead they just issue a new transaction from the backend or withdrawing it from a legit reserve that they own. In any case, no reversing…

> What if instead of taking the bank to the court, we have something in place for it that runs based on certain "if statements" or "switch case"

As I said in my comment, the problem is that if you have a bug in the statements that should protect you, then there is no recourse for your lost money.

Re: In defense of cryptocurrency

#430

Post by headsupernova »

once_inc wrote: post #375
bromuro wrote: post #362

Earlier quoted context omitted.

https://www.bbc.com/news/technology-56012952 “Bitcoin consumes 'more electricity than Argentina'”

"Christmas lights consume more electricity than Argentina." "Wash dryers consume more electricity than Argentina." "Steel foundries consume more electricity than Argentina." What is the point? Comparing global electricity usage of a single sector and comparing it to the usage of a whole country is meaningless.

Those things produce joy, dry clothes, and steel. Crypto produces... scams? We're facing climate collapse and need to choose what we burn electricity on very very wisely.
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