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Hard Problems in Cryptocurrency: Five Years Later

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Re: Hard Problems in Cryptocurrency: Five Years Later

#351

Post by ppf »

hanniabu wrote: post #257
rsynnott wrote: post #6

Earlier quoted context omitted.

I feel like that’s been coming any day now since about 2014. And seems like a TERRIBLE idea, anyway. The rich get richer, built right into the system!

Ethereum wasn't launched until July 2015 so there's one inaccuracy. Also given you're on HN you should likely be aware that (a) timelines are difficult to estimate and often things take much longer than you thought, even more so with being the first to do something, (b) there's a lot of discussion and review for financial software, (c) it's much harder to change the carriage of a moving train

(d) performing work on a moving train is a bug, not a feature.

Re: Hard Problems in Cryptocurrency: Five Years Later

#352

Post by ppf »

epx362 wrote: post #350
Huycfhct wrote: post #344

Earlier quoted context omitted.

Always good to raise millions on a broken idea. Squandering it and then propose a nonsensical 2.0 version to solve all

How is Ethereum broken? It is working right now as we speak. ETH2 is just an upgrade of the network. Just because you percieve it as nonsensical doesn't mean it is and you provided no facts to back up your claims.

In what sense is it working? It's currently very expensive to use, almost all functional apps are essentially speculating, and the system is quickly outgrowing commodity hardware.

Re: Hard Problems in Cryptocurrency: Five Years Later

#353

Post by ppf »

lawn wrote: post #304
Avamander wrote: post #181

Earlier quoted context omitted.

> Credit cards and payment processors take a 2-4% cut, of all transactions. Most payments regular people make every day are sub three-digit. On those payments 2-4% in the US is much cheaper than the current Bitcoin (and similar) transaction fees. That means crypto is rather unusable for most people. I won't even start talking how Bitcoin doesn't compete at all with European SEPA Instant payments for most use-cases. T…

> On those payments 2-4% in the US is much cheaper than the current Bitcoin (and similar) transaction fees. Bitcoin is a horrible example. Bitcoin Cash for example have fees of less than a cent.

It's probably so cheap because no-one wants to use a chain that is so susceptible to a 51% attack.

Re: Hard Problems in Cryptocurrency: Five Years Later

#354

Post by whb07 »

koheripbal wrote: post #201
beefield wrote: post #49

Funny. Article discussing hard problems of crypto and ignoring the elephants in the room. There is still no actual and relevant use case for crypto outside illegal transactions and gambli^H^H^H^H^Hinvestment purposes. The second elephant is that it brings monetary policy back to medieval times. Third is that in practice the whole concept of credit and ots role in money creation is ignored.

As long as coins are designed as a store of value rather than an actual currency, they will have limited use-cases. People need to get over the concept of inflation. Inflation is GOOD.

Can you describe to me how inflation is good for a household? The literature you've probably seen is ex post facto about inflation trying to convince themselves and the world that the inflationary behaviors that were done are "good".

"So every year, your savings get watered down and you lose wealth", is not what one wants to hear.

Re: Hard Problems in Cryptocurrency: Five Years Later

#355

Post by lawn »

ppf wrote: post #353
lawn wrote: post #304

Earlier quoted context omitted.

> On those payments 2-4% in the US is much cheaper than the current Bitcoin (and similar) transaction fees. Bitcoin is a horrible example. Bitcoin Cash for example have fees of less than a cent.

It's probably so cheap because no-one wants to use a chain that is so susceptible to a 51% attack.

No, it's so cheap because Bitcoin has full blocks and people have to outbid each other to get their transaction through. Bitcoin Cash could handle at least 20x the volume of Bitcoin, with the same low fees.

It's not Bitcoin Cash that's special. It's Bitcoin, but in a bad way. Even Monero has very low fees with better capacity for example.

Re: Hard Problems in Cryptocurrency: Five Years Later

#356

Post by ppf »

lawn wrote: post #355
ppf wrote: post #353

Earlier quoted context omitted.

It's probably so cheap because no-one wants to use a chain that is so susceptible to a 51% attack.

No, it's so cheap because Bitcoin has full blocks and people have to outbid each other to get their transaction through. Bitcoin Cash could handle at least 20x the volume of Bitcoin, with the same low fees. It's not Bitcoin Cash that's special. It's Bitcoin, but in a bad way. Even Monero has very low fees with better capacity for example.

If that's the case, why is the transaction count per time period for Bitcoin Cash about 20% of Bitcoin's? On the other hand, it's a significant problem that Bitcoin Cash has about 2% of the hashrate of Bitcoin. Any sensible person would not put any significant value into Bitcoin Cash when such a small percentage of Bitcoin miners could reorg the chain.

Re: Hard Problems in Cryptocurrency: Five Years Later

#357

Post by koheripbal »

onion-soup wrote: post #243

Oh shut up already with big block phobia. BSV proves that big blocks is the most rational way to scale. The small block mantra started by blockstream completely rotted the crypto space

Big blocks will scale you one or two orders of magnitude. There are still 3-5 MORE orders of magnitude to go before you approach that of a standard Credit Card transaction processor.

Re: Hard Problems in Cryptocurrency: Five Years Later

#358

Post by st1ck »

MuncleUscles wrote: post #102
jkhdigital wrote: post #15

I literally spent the past week reading a couple dozen papers on cryptocurrency attacks, in service of a term paper which should hopefully turn into a master's thesis (and possibly more during my PhD campaign). I'm pretty damn pessimistic as a result. Smart contracts basically throw all of your consensus guarantees out the window because they can cause arbitrary exchanges of value in the application layer, which can…

Smart contracts are a bad paradigm for developing applications on the ledger, they're far too permissive, the stakes are too high to want to trust your assets to arbitrary turing-complete code. You can do much better with composable state machines, because everything you do gets the same level of security as the native token transfers https://www.radixdlt.com/post/radix-engine-a-simple-secure-s... Disclaimer: I work…

Smart contract language doesn't have to be Turing complete. In 2018 there was a few related R&D projects, so I hope some of them are more mature by now.

Re: Hard Problems in Cryptocurrency: Five Years Later

#359

Post by xorcist »

v64 wrote: post #329
bouncycastle wrote: post #324

Earlier quoted context omitted.

Nope, Maker contracts are not upgradable. Although the main achilles heel with Maker is the governance and the oracle. The new version of maker has minimised the governance, and the new oracle design has better protection against an oracle attack. Ideally, you want as little governance as possible.

> Nope, Maker contracts are not upgradable. This may have been true in the past, but not anymore. Here's [1] an example of a minor bug that was recently discovered in the MCD deployment and how they're going to patch it. The modules in the Maker system have variables that point to which smart contract to call to execute their actions, and the Maker governance is involved in changing these values. [1] https://forum.ma…

Perhaps a naive question, but in that case, why bother with a blockchain?

If some entity holds the keys to control what code is run, why not let them run the code to begin with? This simplifies implementation significantly, and has obvious scaling benefits.

You can still operate this in a transparent way with multiple independent stakeholders that validates data. Many other systems work this way.

Re: Hard Problems in Cryptocurrency: Five Years Later

#360

Post by v64 »

xorcist wrote: post #359
v64 wrote: post #329

Earlier quoted context omitted.

> Nope, Maker contracts are not upgradable. This may have been true in the past, but not anymore. Here's [1] an example of a minor bug that was recently discovered in the MCD deployment and how they're going to patch it. The modules in the Maker system have variables that point to which smart contract to call to execute their actions, and the Maker governance is involved in changing these values. [1] https://forum.ma…

Perhaps a naive question, but in that case, why bother with a blockchain? If some entity holds the keys to control what code is run, why not let them run the code to begin with? This simplifies implementation significantly, and has obvious scaling benefits. You can still operate this in a transparent way with multiple independent stakeholders that validates data. Many other systems work this way.

There are a couple of reasons.

The Maker system was bootstrapped this way, but now with the release of MCD, the system will be modified so that the Maker corporation's key is revoked and changes to the system will only be able to be made through MKR token governance votes moving forward. [1] When people refer to the "Maker governance", they refer to those decisions that are voted on by holders of the MKR token. In practice in the short term, the Maker corp will still hold a voting majority of MKR, but it's a long term goal that eventually the Maker corporation won't have to exist and the system is totally maintained by the holders of MKR token.

The more important reason though for doing it on the blockchain is reducing technological centralization. Right now, as long as the Ethereum network exists, the Maker system will be on the blockchain and can't be shut down, even if the Maker corporation is dissolved.

US FinCEN has recently set their eyes on stablecoins, declaring that the entities that offer them will need to comply with KYC regulations. [2] By deploying the system on a public blockchain, it's arguable that the US govt will not be able to cease the distribution of Dai itself and will only be able to go after its holders.

[1] https://forum.makerdao.com/t/mkr-token-authority-transfer/83...

[2] https://finance.yahoo.com/news/fincen-stablecoin-issuers-mon...

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