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Cryptocurrency in the 2020s

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Re: Cryptocurrency in the 2020s

#41

Post by kspacewalk2 »

4AoZqrH2fsk5UB wrote: post #13

I’m pretty new to crypto in general, but it seems to me that the primary value of it in coming years would be anonymity/privacy. As I understand it Bitcoin has some problems in this regard, but others have solved it. I just can’t find it hard to believe we get to 2030 without a way to buy things anonymously online.

You have a way to buy things anonymously right now, it's called Bitcoin. If you mean a low-fee and frictionless way, it's unclear why that would ever develop. Unless everything you earn and do is anonymous, it seems to me that the transition between the anonymous store of value and your real identity (address, bank acct) will involve friction and cost.

Re: Cryptocurrency in the 2020s

#43

Post by geekpowa »

nordsieck wrote: post #17
asdfasgasdgasdg wrote: post #7

Consider the source, right? How many people without a large vested interest in the propagation and uptake of cryptocurrency consider further growth likely? My guess is that governments will more and more realize that the main utility of blockchains is money laundering and speculation. As has been remarked over and over again, they don't solve any above board problem more efficiently or with lower expense than existin…

> As has been remarked over and over again, they don't solve any above board problem more efficiently or with lower expense than existing technologies. If you mean by that, it's possible to have a fiat currency with no dilution, that is true. Crypto currencies are fundamentally a political innovation; it is much more politically expensive to force dilution onto a crypto-currency than a fiat one. Whether that's valuab…

Dilution / inflation is a feature not a bug. Money should be put to work doing productive stuff in the economy, not hoarded.

Also crypto currencies, are not currencies. They are commodities. It is far more accurate, conceptually to think about them the same as precious metals and grains, not dollars.

Re: Cryptocurrency in the 2020s

#44

Post by mrspeaker »

nobleach wrote: post #12
drcross wrote: post #10

Earlier quoted context omitted.

I remember people scoffing at the concept of 100 dollars per bitcoin like it couldn't possibly happen.

I remember people scoffing at the internet like there no legitimate use-cases for it. "Yeah, we have places for information, it's called Grolier's Encyclopedia on CD-ROM, and it's cheap!". "I already have yellow pages delivered for free by C&P Bell". While cryptocurrency may be quite a bit more narrow, blockchain is most likely a far more interesting technology.

I remember people scoffing at the Segway, Zune, RJ Reynold's smokeless cigarettes, Flooz, Nintendo Virtual Boy, the Digital Compact Cassette, Apple Newton, Microsoft Songsmith.... All also quite interesting!

I think bitcoin is a really innovative idea (and kicking myself for not acting on my initial instincts when I read about it on HN in 2010 - when mining software said "please don't use your GPU"!) but I don't buy this "people laughed at the internet too, so bitcoin must be important!" line.

Re: Cryptocurrency in the 2020s

#45

Post by thenewnewguy »

wpietri wrote: post #27
asdfasgasdgasdg wrote: post #7

Consider the source, right? How many people without a large vested interest in the propagation and uptake of cryptocurrency consider further growth likely? My guess is that governments will more and more realize that the main utility of blockchains is money laundering and speculation. As has been remarked over and over again, they don't solve any above board problem more efficiently or with lower expense than existin…

Exactly. It has been 10+ years since the Bitcoin paper. No cryptocurrency has significant consumer adoption. [1], [2] Except for light financial crime (ransomware, money laundering, gambling, theft, etc), it has no demonstrated advantage over alternative technologies. I don't think it will go away, any more than Ponzi and Make Money Fast schemes have gone away. But like you, I expect it will fade into the background…

> Except for light financial crime (ransomware, money laundering, gambling, theft, etc), it has no demonstrated advantage over alternative technologies.

Slight nitpick: Cryptocurrencies have demonstrable advantages over existing solutions (pseudo-anonymity, decentralization, inflation-proof, etc) but consumers don't care about these advantages enough to make the switch.

Re: Cryptocurrency in the 2020s

#46

Post by nordsieck »

v64 wrote: post #31
RcouF1uZ4gsC wrote: post #26

Earlier quoted context omitted.

> If you look at what MakerDAO is doing with the Dai stablecoin, they've proven that it's possible to create a synthetic asset closely pegged to the dollar purely through financial incentives, and they did it all just using Ethereum v1. A holder of Dai can earn 4% APY through a Dai Savings Account, and a vote is currently in place to raise the rate to 6%. >I personally find it incredible that an asset exists on the b…

The complete functioning of the MakerDAO system is publicly documented here [1] and here [2]. Feel free to peruse the documentation and point out which parts seem unbelievable. The system is currently live and I hold a Dai Savings Account and can attest I've been paid according to the system's documentation. [1] https://community-development.makerdao.com/makerdao-mcd-faqs [2] https://docs.makerdao.com/

> Feel free to peruse the documentation and point out which parts seem unbelievable. The system is currently live and I hold a Dai Savings Account and can attest I've been paid according to the system's documentation.

The problem with bad financial instruments is not that they don't work at all, but that they work fine for a period of time and then blow up.

I think the point your parent was trying to make is that the long term interest rate of any security has an upper bound of the growth rate of the economy.

I don't know of anyone who things the US economy has a real growth rate of 6%.

Re: Cryptocurrency in the 2020s

#47

Post by cactus2093 »

asdfasgasdgasdg wrote: post #7

Consider the source, right? How many people without a large vested interest in the propagation and uptake of cryptocurrency consider further growth likely? My guess is that governments will more and more realize that the main utility of blockchains is money laundering and speculation. As has been remarked over and over again, they don't solve any above board problem more efficiently or with lower expense than existin…

> they don't solve any above board problem more efficiently or with lower expense than existing technologies

You've picked two arbitrary criteria, which certainly don't cover the entire range of useful properties that anybody in the world might want. And even still, you're only right about one of them. Cryptocurrency is very inefficient from a power consumption standpoint, no denying that. Not sure what you mean about lower expense though, sending money internationally (in a perfectly above-board way, like placing an order or supporting relatives in another country) can be a lot cheaper via bitcoin than alternatives like Western Union. It's also useful as a store of value that's not tied to a single government, so similar to gold in its intrinsic value but with the benefit that it doesn't take up physical space and can be sent and received much more easily.

I'm still quite bullish on bitcoin itself, for these properties alone, I see these properties as basically a floor on the value that it can provide and even just for for this use there's room for a lot of growth. If Ethereum-style contracts/apps and all the other kinds of things discussed in the post also gain wide adoption (which certainly seem like far from a sure thing at this point, but also not completely crazy), that's just a bonus.

Re: Cryptocurrency in the 2020s

#49

Post by v64 »

kspacewalk2 wrote: post #37
v64 wrote: post #16

Earlier quoted context omitted.

I honestly don't understand where the perception comes from that this technology is only useful for laundering and speculation. Certainly it is currently being used for those purposes. But to say there is no imaginable use outside of that seems unwarranted. I've commented in the past here that the use of public blockchains to automate the functions of clearinghouses and escrow services will be a huge cost reduction f…

>the use of public blockchains to automate the functions of clearinghouses and escrow services will be a huge cost reduction for many industries such as finance. But we don't want financial transactions to be fully automated and immutable. We want escrow services to be subject to laws, we want a judicial undo and modify button. So if you remove the whole "no one can change history" bit because it's an anti-feature, i…

There are definitely cases where transactions need to be reversed, and this functionality can be built into a clearinghouse system. Immutability is a plus here because you have an unalterable audit log showing the original transaction and then the subsequent transaction that reverses the first. The cost savings comes from the fact that instead of having to hire independent auditors to verify the paper trail, the blockchain serves as an immutable audit log and can be verified programmatically.

Re: Cryptocurrency in the 2020s

#50

Post by RcouF1uZ4gsC »

kspacewalk2 wrote: post #37
v64 wrote: post #16

Earlier quoted context omitted.

I honestly don't understand where the perception comes from that this technology is only useful for laundering and speculation. Certainly it is currently being used for those purposes. But to say there is no imaginable use outside of that seems unwarranted. I've commented in the past here that the use of public blockchains to automate the functions of clearinghouses and escrow services will be a huge cost reduction f…

>the use of public blockchains to automate the functions of clearinghouses and escrow services will be a huge cost reduction for many industries such as finance. But we don't want financial transactions to be fully automated and immutable. We want escrow services to be subject to laws, we want a judicial undo and modify button. So if you remove the whole "no one can change history" bit because it's an anti-feature, i…

> But we don't want financial transactions to be fully automated and immutable.

And cryptocurrency does not provide immutability anyway. Remember the DAO Ethereum fiasco where they lost a bunch of money and decided to roll it back.

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