The Web3 Fraud • Hacker News Board

Re: The Web3 Fraud

#281

Post by vmception » Fri, Dec 17, 2021, 1:31 PM UTC

Animats wrote: post #168

The technology is interesting, but so far most of the use cases involve some form of illegality. If you want to use, say, NFTs for something legitimate, it turns out they don't really work very well for that. I'd looked at using NFTs for cross-grid ownership transfers of objects in Open Simulator. That's a set of virtual worlds run by several hundred different people and organizations, but using the same software, a…

Solana blockchain would be appropriate for your grid transfer as it can function in that time frame. You can also just do things asynchronously client side.

NFT data is not comprehensive and doesn't include all subsets of that market, most of it is collectors markets.

The Play 2 Earn space has nothing to do with collectors markets. This is analogous to saying Fortnite players grinding for characters skins are providing a forecast into the baseball trading card market.

The verified Bored Ape Yacht Club is the only Bored Ape collection to care about. This seems like the worst example for you to pick, since that collection is still under high demand? Asking prices being met, recently sold prices being the same price?

https://opensea.io/collection/boredapeyachtclub?search[sortA...

Also your post is lacking an example of illegality and its relation to prevalence in the sector

Re: The Web3 Fraud

#282

Post by derangedHorse » Fri, Dec 17, 2021, 1:37 PM UTC

rank0 wrote: post #241

exdsq wrote: post #207

Earlier quoted context omitted.

This is fair, I wish more teams were working on the boring useful use-cases. One I particularly like is gig tickets. Represent them as NFTs, prove ownership of the ticket as it is in your wallet, trade them for USD with anyone around the world in a single atomic transaction, use third party tools to verify a ticket is authentic (either manually copying an NFT address onto a bands website or programatically). Suddenly…

The tickets are already in closed ecosystems like Ticketmaster. It would be orders if magnitudes more efficient for them to just add resale functionality to their platform. Problem is they don’t want third party resellers. And herein lies the problem. At some point cyrpto tokens have to come back into the real world. If you can’t get $centralized_authority onboard you’re screwed. And if it’s not “decentralized” just…

> The tickets are already in closed ecosystems like Ticketmaster. It would be orders if magnitudes more efficient for them to just add resale functionality to their platform. Problem is they don’t want third party resellers.

Not really, adding a payment infrastructure that allows peer to peer payments is non-trivial. Also with smart contracts you could collect royalties on the reselling of tickets while keeping the data open enough for anyone to capitalize on creating a front end marketplace along with the original minter (which could encourage more innovation in usability). The minters also would have financial incentive to not shut down these 3rd party front end marketplaces because they can make it so that they’ll collect royalties regardless

Re: The Web3 Fraud

#283

Post by derangedHorse » Fri, Dec 17, 2021, 1:48 PM UTC

toomuchtodo wrote: post #14

endisneigh wrote: post #5

I don’t understand what problem web3 can solve that a trusted entity cannot. And let’s keep in mind your reply to this comment will be using a trusted entity. In fact in the history of the internet I cannot find a single example of any technology working better in a decentralized fashion compared to centralized for the end user

Hot take: The proponents of decentralized systems feel disenfranchised by those who own and govern centralized systems, therefore decentralized systems are their way around what they consider injustice. It is a grasp for control and power where they feel they have none. They don’t feel they have a seat at the table, so they argue for building their own table, which is, naturally, “superior” to the existing table (why…

I would say it’s about choice, not an “our finance” vs “their finance” (at least not primarily). I don’t think the traditional finance systems needs to be overthrown but I do think people have a right to choose an alternative open system if they choose. If it was an “our finance” vs “their finance” problem, people could just build a new centralized system without the properties offered by the blockchain.

Re: The Web3 Fraud

#284

Post by vintermann » Fri, Dec 17, 2021, 1:49 PM UTC

selestify wrote: post #270

vintermann wrote: post #263

Earlier quoted context omitted.

So you can - Trade blockchain tokens for other blockchain tokens. Or trade blockchain tokens for tokens that claim (with dubious, temporary and totally non-cryptographic evidence) to be backed by something else. - Lend and borrow blockchain tokens. - Try to launder your blockchain tokens. They have to be really dirty for it to be worth it, since obscuring how you got hold of something valuable is already a crime in i…

> Trade blockchain tokens for other blockchain tokens. Or trade blockchain tokens for tokens that claim (with dubious, temporary and totally non-cryptographic evidence) to be backed by something else. The Perth Mint is "dubious" and "temporary" to you? If you dislike examples of assets backed by centralized entities, then look at decentralized algorithmic stablecoins. > - Lend and borrow blockchain tokens. Yes, inclu…

Yes, it's temporary, in the sense that even tokens backed today might not necessarily be backed tomorrow.

And yes, it is actually a surprisingly dubious organization (that corporations fully owned by a state and performing some minor official service for it, can still be extremely dodgy, should not come as a surprise).

They seem to be profiting off the assumption that from the name, they would be as tightly controlled as a central bank. But it's very clear from dodgy stuff they've already been involved in, that they're absolutely not.

But of course, I wasn't first and foremost talking about them, I was talking about the 800 dollar gorilla, Tether. They're now where Mt Gox was ca. mid-2013, with "everyone" knowing they're extremely dodgy and likely to collapse, but hoping to make money off those who haven't realized it yet.

As to "tracking" real world assets, that mechanism of tracking is a weak point, rendering all the other "guarantees" moot.

> Just because you don't see any value in money laundering doesn't mean others don't. It's a billion dollar industry.

So is other fraud. Doesn't mean it isn't money out the window. For that matter, you don't know how much of the economic activity is real. Saying "this laundromat must be really good, see how much money is going through it" is a lot like saying "this service for purchasing fake reviews must be great, look how many 6 star reviews it has".

Re: The Web3 Fraud

#285

Post by lumost » Fri, Dec 17, 2021, 1:59 PM UTC

landemva wrote: post #230

lumost wrote: post #218

Earlier quoted context omitted.

I'd suspect that the longevity of a cloud provider or self hosted environment would be higher than the time miners are willing to support a new block chain (I'm not paying a btc transaction fee everytime I update an app). How will miners be paid to host apps? Given that app usage concentrates into winner take all groupings wouldn't we except the web 3 winners to be paying for the vast majority of any web 3 mining?

Miners don't host the front ends. Miners run whatever contract code is called by anyone who sends a signed transaction.

Wouldn't actions like add to cart, etc all require contract code execution?

Re: The Web3 Fraud

#286

Post by DannyBee » Fri, Dec 17, 2021, 1:59 PM UTC

selestify wrote: post #272

DannyBee wrote: post #266

Earlier quoted context omitted.

As I said to OP, no, it's not apples to oranges, you are absolutely wrong. It's comparisons of different points in the app architecture space, and that's normal, and not pointless as you claim. You can't wave away the serious issues by saying "there's no point in comparing them" Lots of things offer different functionality and tradeoffs. If you want to play in the space of "web app", you can and should be compared to…

> Any solution for a given use case can and should get compared with other solutions for that use case. And the current use cases are sufficiently different that it's like comparing apples and oranges. > I'm really sorry that it doesn't seem (judging by this thread) to compare particularly well for most developers, but that doesn't invalidate the comparison. Again, do you think the same of Tor? It doesn't compare par…

"And the current use cases are sufficiently different that it's like comparing apples and oranges."

Uh, what? This whole thread and post is about the argument that replacing existing apps with dapps will be better (or worse).

Re: The Web3 Fraud

#287

Post by acdha » Fri, Dec 17, 2021, 2:00 PM UTC

abaga129 wrote: post #222

streetcat1 wrote: post #60

Earlier quoted context omitted.

No it is not. There is no inherit value to bitcoin or any other token or coin. Those are just some hash values printed on a digital marker. Imagine that I assign value to my monopoly money (as in the game), and it is traded in a stock exchange. Yes, it could reach 60K, but it is still monopoly money.

How is that any different from Fiat money? Or anything for that matter. It holds no real value beyond the paper it is printed on. It is valuable because we all agree as a society to give it value.

Yes, cryptocurrency is the purest form of fiat currency, which is to say a very weak one. The difference is that almost all other fiat currencies are backed by an organization with real world power: for example, the US dollar is required to pay taxes in one of the largest world economies, which guarantees trillions of dollars in demand, and it’s what the US government uses to pay millions of people and buy all kinds of different things. Other countries currencies follow that pattern to varying degrees which is also why we’ve seen efforts like the Euro to, among other reasons, increase the overall volume.

Cryptocurrencies lack sovereignty and don’t have an alternative source of baseline demand, which is why they’re volatile on a level normally associated with collapsing states — especially if they’re like Bitcoin where the deflationary model encourages everyone not to spend. When anyone can easily set up a functional equivalent, there isn’t much to anchor the valuation. This is why people created things like NFTs to give others a reason to buy their tokens rather than someone else’s but that’s not especially stable until those NFTs are accompanied by legal contracts conveying tangible value.

Re: The Web3 Fraud

#288

Post by webmaven » Fri, Dec 17, 2021, 3:04 PM UTC

selestify wrote: post #186

smoldesu wrote: post #177

Earlier quoted context omitted.

Where's your "Google"? Where's your "YouTube"? Where's your killer app? Everything you've listed is just different ways to throw away cryptocurrency. The average Joe is going to look at that list, chuckle, and go back to browsing Twitter on their iPhone. There's no main attraction here.

> Where's your "YouTube"? Where's your killer app? Where's the "Youtube" of the dark web? The famed red rooms don't even exist. What's the "killer app" of the dark web? Doesn't even exist, unless maybe you count the drug markets. I'd hazard a guess that they're by far the most popular. > Everything you've listed is just different ways to throw away cryptocurrency. I literally gave as an example how you could use fiat…

> The average Joe has no business using Tor.

If the only people using Tor are people who actually need it, then 'using Tor' becomes a very dangerous marker.

Re: The Web3 Fraud

#289

Post by tata71 » Fri, Dec 17, 2021, 3:16 PM UTC

vmception wrote: post #142

jjnoakes wrote: post #109

Earlier quoted context omitted.

I disagree. The cost of just deploying my contract might pay for years of self hosting at current transaction rates. It might eventually amortize out to cheaper over many, many years, but that assumes no changes are ever needed. How likely is that?

You could use any other EVM or smart contract platform than Ethereum

zkEVM

Re: The Web3 Fraud

#290

Post by mattwilsonn888 » Fri, Dec 17, 2021, 3:41 PM UTC

lumost wrote: post #218

v64 wrote: post #93

Earlier quoted context omitted.

Yes, these are the failure scenarios I had in mind when I wrote "the ability to shutdown these apps would rely on somehow breaking the blockchain itself". It's possible that bugs in the blockchain software can cause blocks to no longer be produced, essentially halting the network until the problem is resolved. So-called 51% attacks are also a failure possibility.

I'd suspect that the longevity of a cloud provider or self hosted environment would be higher than the time miners are willing to support a new block chain (I'm not paying a btc transaction fee everytime I update an app). How will miners be paid to host apps? Given that app usage concentrates into winner take all groupings wouldn't we except the web 3 winners to be paying for the vast majority of any web 3 mining?

You're getting to a fundamental issue that separates Bitcoin from other chains which strive to push and hold more data on chain: there is no efficient pricing mechanism to host data. What this means is that putting any data on chain at all is either expensive, or limited by hard code. The issue is that the data stays on chain forever yet without any 'rent' associated to it, therefore space is limited or cost is poorly estimated up front (or compromises on decentralization like sharding occur).

Bitcoin doesn't technically solve this either, its just that its data growth rate is small enough to be trivial in comparison to storage costs. Ethereum and other classical distributed ledger systems cannot fulfill the true vision of Web3 (it can and will continue to do a fraction of that vision) because they have no affectual economic functions for data rent or data handling in general. Mining/staking is paid for and everything else is an economic after-thought. Ethereum's Infura Problem is a quick way to see the consequences of these poorly suited economic incentives.

Bitcoin is about stability, but Web3 is about data, so I believe its fair to say that a distributed ledger technology built for "Web3" (which is quickly becoming a dirty word) will have its economic components focused on data. This is different from keeping the traditional Nakamoto Consensus (which judges value based on somewhat arbitrary measures) but deriving tricks to push more data - this means maintaining or exceeding the security guarantees of Nakamoto Consensus while incentivizing data routing-work and storage rather than number crunching.