221–230 of 278 posts
Perhaps one day, the tech community will understand that some problems require a political solution and simply cannot be solved by technological means alone.
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how long do you think it takes to turn fiat into bitcoin and bitcoin back into fiat for the recipient? Hint: its longer than clearing a check
That's not bitcoin's fault, it's the traditional financial system's fault. The transaction can only happen at the rate of the slowest party.
Most predictions of the future are wrong
As a blockchain developer of 2 years who understands the principles behind Tendermint and who has build many scalable systems in his career, I can say for sure that Tendermint doesn't add any scalability to any given blockchain. It only aids with certain specific interoperability scenarios (nothing to do with scalability). The statement on their website is not accurate. The people who wrote this statement are marketing people who do not understand the first thing about scalability of any system. The leaders of these projects wash their hands of any responsibility by pretending to believe their own dogma.
Most blockchain marketing is a flat out scam IMO. As a result of all this deception, almost everything that everyone knows about blockchain today is wrong. Everyone thinks that all the trendy cryptocurrencies can scale but they can't. None of the ones that I analyzed in the last 2 years could scale. And I looked at many; for those whose whitepaper made the most sense, I even made the time to discuss the tech with their lead developers, node operators and community members. The reality is always far behind the marketing.
Unfortunately, investors are investing based on hype and their personal connections, not based on demonstrable facts. Investors are being mislead en-mass. As a developer who understands the tech and who actually believes in its potential to incentivize productive collaboration, it's disturbing to watch how the industry is unfolding.
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Bitcoin is continuing to scale, but it's doing so with the Lightning Network instead of by increasing block size. I'm not super familiar with Bitcoin's tech, but that seems sensible to me. The blockchain is already 250 GB at 7 transactions per second. If you multiplied that by 100, you still have orders of magnitude less transactions per second than credit card processors, but the hardware requirements are now high e…
The Lightning Network is a pipedream of ivory tower developers. People who think LN can scale Bitcoin into a global currency rivaling USD and EUR either don't understand LN or are lying on purpose. Fact is that each LN "channel" needs a committed amount of Bitcoin that can only be withdrawn by closing the channel. If you want your Bitcoins "secured" in you wallet, you need to close the channel. Otherwise you will - b…
There are probably going to be some big entities in the Lightning Network ("lightning service providers") that average users use to open channels in exchange for a fee. These LSPs need to closely monitor for malicious transactions, but the average user doesn't have to. The average user would only get ripped off if their LSP broadcast an invalid transaction. In that case, they could prove it to the network and everyone would leave the LSP. Eventually there will be long-standing LSPs with good reputation. People can open long-running payment channels with them. If on-chain transaction fees get really high, they could be set to timeout after a year. That gives both parties plenty of time to notice an invalid transaction. If they're paranoid about DoS or timing attack, they can close the channel a few days before it times out.
That's my understanding only from reading a few articles about how Lightning Network works, so what I'm saying might be ridiculous and I could be completely wrong.
The trouble with this article is that the author doesn't seem to know what Bitcoin is for. Notice the vague treatment of actual cryptocurrency applications. There are lots of predictions about startup activity, "flippenings" and venture capital, but little about the goods and services customers will actually be buying, or what specifically startups will be building. It's this kind of thinking that leads people into t…
Your comment sounds like a priest delivering a sermon. No sources to back your argument up and also you missed a large fact that Bitcoin just doesn't scale for any of the applications you've outlined.
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> Dilution / inflation is a feature not a bug. This is not true. We have simply adopted a system where it is a feature. We did not have steady enforced inflation until the 1950s. There are entire schools of economics that believe the concept of controlled inflation should be relegated to the past, and replaced with market ruled inflation / deflation. I'm not saying I understand how such a fictional world will work (a…
Inflation is an emergent property of money. It isn't set or enforced it just naturally happens because of money. Monetary policy can be set to try to corral it to certain ranges based on economic beliefs about what rate of inflation implies in terms of growth and risk. 2008 happened because of bad debt. That the bad debt was cheap debt certainly poured fuel on the fire, yet the fundamental issue was deregulation and…
All of this is wrong. Inflation is a supply / demand problem plain and simple. It has nothing to do with money. What money does have to do with it is when the fed devalues the dollar to drive up inflation. It is not natural. It is clearly controlled. If the fed didn't exist, we'd face both inflation and deflation only based on supply and demand. So we'd never have a steady increase in prices (unless the royal mint of our fantasy land was really opening up the spigots, in which case they're the same as the fed).
> 2008 happened because of bad debt.
Yes. But what people don't see is the sequence of events that led to it. If you're in finance, it's blatantly obvious, but outside it, it's shrouded in mist because no one famous will put it in an understandable form.
2008 happened primarily because of Alan Greenspan. What people don't realise is that none of the world leaders since the 1980s have done anything of consequence compared to what Greenspan did. His policy of "let's just keep the pumps open" have inflated markets and literally powered this exponential tech growth we're seeing now. My conjecture is that it'll stall out. Money doesn't grow on trees however much we may want it to.
2008 was the culmination of this 3 decade long money pump. But what did the fed do when it realised 2008 was happening? Oh that's right - it pumped even more money. But that's a topic for another time.
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I'm yet to find it. For a meme-ish sub /r/wallstreetbets is pretty good. Go there and have a laugh. But places like /r/economics and /r/finance are utter shit. The best resource is financial twitter (fintwit). The news breaks there, the discussion happens there, and loads of meme-ing also takes place (which is always a nice to-have in a serious place). The only drawback is that most of them lean exactly the way I do.…
Have a short list of worthy follows to start breaking into it?
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Most people? Personal loan rates are closer to 7-8% on average I think. The fed funds rate is the very basic rate of economic activity. I mean, you obviously included the caveat about the spreads for retail products. What did you think those spreads looked like?
Personal loan rates aren't collateralized, which you're comparing with fully-collateralized loans. That's apples and oranges. Loans that are actually similar run <4%, not 7-8%.
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> A 6% interest rate on USD would be a red flag, but Dai isn't USD. Is this written in their documentation? Cos this is where the smart money gets out. The DAI competes against the USD. So all their transactions have to be in USD. No vendor for your products is accepting these magical tokens. No one in the economy except vanishingly small fractions accept digital tokens for trade. Also, this is how the economy functi…
> No vendor for your products is accepting these magical tokens. No one in the economy except vanishingly small fractions accept digital tokens for trade. MakerDAO has a list of vendors who accept Dai today [1]. The list also contains a number of payment processors that enable businesses to accept Dai. It's true that it's not widely used now, but every product has to start somewhere. I don't think I'm going to be get…
Fair enough. If it grows, it grows.
> You say that as if creating an automated decentralized bank that generates an asset pegged to the US dollar is something that just anybody could do.
If you have 100% collateralised loan, yes, anybody could do it in this day and age. Money can actually grow in an automated fashion without a central authority if we accept the inevitability of economic crashes and depressions.
Here's my thought experiment - say DAI suddenly overnight replaces the dollar. I don't know enough about the system, but I know finance very well. Next, say the day after the economy starts crashing. Manufacturers cannot see any orders coming in, consumers don't want to spend money etc etc. Run of the mill crash. What would DAI do?
I'll tell you how this works out in an uncontrolled money system - the crash goes on for more than a couple of years. People lose jobs, companies close etc. The federal reserve's one and only job (the regulation part is hogwash, they can't regulate for shit) is to cushion such an economic crash. What happens without it? Will the benevolent DAI system controllers step in?
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Banks don't create money, they create debt.
It's only a debt for the business who receives the loan. When a business receives a loan it shows up as an asset to them in the form of a bank deposit. The business then usually uses that demand deposit to purchase goods and services, so people who don't owe debt to the bank get those deposits in their accounts, and spend the deposits, etc., etc. So effectively, private banks create money.