Crypto is the 'commoditisation of populist anger, gambling and crime' • Hacker News Board

Re: Crypto is the 'commoditisation of populist anger, gambling and crime'

#21

Post by vagrantJin » Tue, Nov 22, 2022, 12:02 AM UTC

ilaksh wrote: post #20

HappySweeney wrote: post #19

Earlier quoted context omitted.

This is just my opinion, but I highly doubt it. Trust in the technology has been broken by all the hacks, scams, and rug-pulls. Without Joe Average investing in the space, it will never get to the scale required for it to be a viable currency, so there will be no effect on the financial system. Trust is won in drops and lost in buckets, so it will be a long time before Joe looks to crypto as an investment vehicle, if…

That's kind of the popular sentiment throughout history for all technological advancements. They said the same thing about cars, TVs, personal computers, neural networks etc. "this will probably never really be a thing". Plato said "Writing is a step backward for truth". Trithemius said "Printed books will never be the equivalent of handwritten codices." Mark Twain thought that the telephone had no market and passed…

> "I think there is a world market for maybe five computers." -- Thomas Watson, president of IBM, 1943

He was not wrong! Its about context.

Computers were giant complex calculators that needed several highly skilled people to operate. And expensive.

Its like SpaceX saying the same thing about falcon heavy propulsion systems.

Big, dangerous, requires highly skilled personnel to operate and hella expensive.

Context!

Re: Crypto is the 'commoditisation of populist anger, gambling and crime'

#22

Post by JohnFen » Tue, Nov 22, 2022, 1:55 AM UTC

ilaksh wrote: post #15

krunck wrote: post #8

Earlier quoted context omitted.

"I don’t want to see so many people getting hurt. My generation has been hit by the financial crisis, by Covid, we’re going to have the climate crisis. These people don’t need this extra suffering in their life." Better get working on fixing the financial system, the health care system, and CO2 production. Hating on crypto won't solve those.

But promoting and adopting cryptocurrency technology actually _will_ improve the financial system. That's the thing that, amazingly, technical people are not picking up on.

Perhaps technical people aren't picking up on it because nobody has made a strong argument (as near as I can see) that it's true?

Re: Crypto is the 'commoditisation of populist anger, gambling and crime'

#23

Post by ilaksh » Tue, Nov 22, 2022, 4:30 AM UTC

JohnFen wrote: post #22

ilaksh wrote: post #15

Earlier quoted context omitted.

But promoting and adopting cryptocurrency technology actually _will_ improve the financial system. That's the thing that, amazingly, technical people are not picking up on.

Perhaps technical people aren't picking up on it because nobody has made a strong argument (as near as I can see) that it's true?

Please see my comment in the thread explaining the three main advances.

Re: Crypto is the 'commoditisation of populist anger, gambling and crime'

#24

Post by spinchange » Tue, Nov 22, 2022, 10:44 AM UTC

ilaksh wrote: post #12

First, people should separate the technology of cryptocurrency from speculation on centralized exchanges and other bank-like behavior that actually takes money off-chain. Almost everything that people are talking about when they say "crypto" is explicitly NOT using cryptocurrency but rather collecting money with cryptocurrency to help with marketing and onboarding but then speculating with it off chain in the traditi…

"...Because there is no central authority controlling who can participate, decentralized consensus systems must defend against Sybil attacks, in which the attacker creates a majority of seemingly independent participants which are secretly under his control. The defense is to ensure that the reward for a successful Sybil attack is less than the cost of mounting it. Thus participation in a permissionless blockchain must be expensive, so miners must be reimbursed for their costly efforts. There is no central authority capable of collecting funds from users and distributing them to the miners in proportion to these efforts. Thus miners' reimbursement must be generated organically by the blockchain itself; a permissionless blockchain needs a cryptocurrency to be secure.

Because miners' opex and capex costs cannot be paid in the blockchain's cryptocurrency, exchanges are required to enable the rewards for mining to be converted into fiat currency to pay these costs. Someone needs to be on the other side of these sell orders. The only reason to be on the buy side of these orders is the belief that "number go up". Thus the exchanges need to attract speculators in order to perform their function.

Thus a permissionless blockchain requires a cryptocurrency to function, and this cryptocurrency requires speculation to function

Why are economies of scale a fundamental problem for decentralized systems? Participation must be expensive, and so will be subject to economies of scale. They will drive the system to centralize. So the expenditure in attempting to ensure that the system is decentralized is a futile waste."

https://blog.dshr.org/2022/02/ee380-talk.html?m=1

Re: Crypto is the 'commoditisation of populist anger, gambling and crime'

#25

Post by spinchange » Tue, Nov 22, 2022, 10:56 AM UTC

hd4 wrote: post #6

Whenever such threads or articles pop up on here, I rarely ever see good discussion into the details around why the GFC even happened (much of what I will say is inspired by Jeff Snider and his excellent Eurodollar University project). I am going to tl;dr it and say (and I know this specific aspect is usually well-covered) that central banking and fiat money itself is at the very heart of it. An extreme shortage of g…

"An extreme shortage of good-quality collateral was why the GFC happened"

It started with a housing boom in America and housing is not generally poor quality collateral. More money was lent than could be repaid because of the way securitization was being done. Then a bunch of "safe" synthetic derivatives we're created off that bad debt too. The real estate collateral underneath it all was probably the only good thing (and part of the justification for the whole mess in the first place)