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Ethereum Is a Dark Forest

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Re: Ethereum Is a Dark Forest

#61
post #35

Earlier quoted context omitted.

Isn't that the whole security / obscurity point? That true security only comes by being exposed to active, intelligent, informed adversaries for a sufficient amount of time? Or, another way: each exploit and oops only improves the system, rather than being a signal of its failure. And let's be honest, the competition is still "Oops, I accidentally sent $900M to the wrong party." [1] [1] https://news.ycombinator.com/i…

> And let's be honest, the competition is still "Oops, I accidentally sent $900M to the wrong party." [1] The counterargument there is that Citibank is currently pursuing a resolution in the courts to that issue, and if they win they will get their $900M back. If you flub a DeFi transaction, you're shit outta luck.

And of course, if cryptocurrencies ever become anything more than Internet play money (and environmental disaster), the legal systems of countries worldwide will make sure the same protections apply. So yes, your newest cryptoanarchist token may have totally irreversible transactions (cross my heart, here's the math proof!), but the court can still order the thief to send back the money they stole in a separate transaction, under threat of prison time. The judge will not care that the relevant "smart contract" prohibits such behavior.

Because that's what real-world security ultimately boils down to: men with guns, ready to drag you where the law tells them to. It's not perfect, but it achieves 99% of the effect at the fraction of a cost of a "trustless" proof-of-work system.

Re: Ethereum Is a Dark Forest

#62
post #45

The whole thing is a complicated, wacky game. The DeFi stuff is especially fun right now. Opportunities (and danger) abound. There is so much money locked up in DeFi. It's not necessarily always good for the bots either. They can be exploited and tricked as well.

I would love to hear of how the bots feed off each other.

I heard of one being baited into making transactions that would fail, but still being charged gas

Re: Ethereum Is a Dark Forest

#63

Earlier quoted context omitted.

Is DeFi an actual thing, or just a term for cryptocurrencies in general?

DeFi is basically financial applications built on top of cryptocurrencies. Sometimes these financial applications (like exchanges, money markets, loan offerings, etc.) are decentralized.

Hmm, only sometimes? Doesn't the name imply otherwise?

Re: Ethereum Is a Dark Forest

#64

Earlier quoted context omitted.

This is the bit I didn't get about the article. How could the original owner of the $12K get their money out without getting pwned by the same bots?

They can't.

So, assuming the original person in TFA had some kind of authentic claim on the money, why are they not losing it according to GP?

Re: Ethereum Is a Dark Forest

#65
post #48
post #3

As an elaborate real-money PVP system, Etherum is amazing. As a means of doing relatively normal business, being sniped, frontrun, or exploited is hugely off-putting.

In order for money to be both real and useful it should be secured by unencumbered interest in durable real property. The simplest way to circulate commercial paper for daily transactions is the Benjamin Franklin paper money system which involves appointing public loan officers throughout a nation to issue equity loans to anyone in possession of unencumbered interest in durable real property which they are willing to…

Why? This is unnecessarily encumbering the utility of money.

Real and Useful: people can use the money as a store of value, medium of exchange, and a unit of account - and enough people believe in it.

Re: Ethereum Is a Dark Forest

#66
Perhaps due to a certain naivete I enjoy almost all discussions on HN. There are few exceptions and discussions under blockchain-related posts are the a prime example. I will disclose right away that I wholeheartedly think that blockchains are here to stay and to solve many problems. The general sentiment on HN, and this thread so far is an example, seems to be animosity toward the idea in general lightly veiled by pretext of pointing out technical challenges (which are numerous, I do not think the most ardent blockchain proponent will deny). Every time I try to point some great ability of "smart contracts" in return I hear blanket unthoughtful responses like "well how is it better than a database" or "how is it better than a REST call" (for example this exchange about the Baseline protocol https://news.ycombinator.com/item?id=23824584).

Perhaps starting with a general accusation of the community is not the best method. But I'll move on... There are things that are very important to understand about blockchain. The most important one is that the technology and the systems built on it are _extremely_ young. Blockchain is like the 80s of computing. I would compare it to editing Unix system settings with "nano" to adjust a basic setting of your operating system - lots of horror stories for sure. The big difference is that people are out there to make money off of your mistakes. Yes, it can be a hostile environment. As the article alludes to - full anonymity of transactions is still in the pipeline! I do no know a single blockchain project out there that allows to interact with contracts anonymously yet. If blockchain is still alive a few years from now (and I have little doubt about that) then things like Optimism (mentioned in the article) will have made a whole array of shortcomings obsolete. Awesomeness does not happen overnight, it took _decades_ for the internet to become the ubiquitous integral thing that it is now.

Actually, I'm glad the author used Uniswap as an example, because it is a simple and powerful system that would not have been possible without blockchain. (Aside: Uniswap is actually one of the first products to create a POC of running on top of Optimism's Optimistic rollups, so they are no unaware of issues). It was conceived initially by Vitalik himself and implemented as an Ethereum grant. The basic idea is that a contract controls two pools of tokenized assets. The assets are provided by people who get a cut when a trade happens. The price of assets being exchanged is equal to the ratio of their quantities in every pool. That is it!!

Now, why do I think that a system as Uniswap is awesome. Right now most tokens are either tokens for other projects or USD. As the variety of tokenized assets grows (for example some Japanese banks are looking to create a digital Yen, and there are clues that suggest it might be on Ethereum) what you get is an extremely simple no-middlemen system for exchanging things of value. Now, in theory, any programmer can write a program, say, for currency exchange in one evening - no middlemen, no 3rd parties to trust, no banks, no clearing houses and a basic API anybody can integrate. The system is not perfect, and that's what the article is about. But the concept can be revolutionary.

The blockchain money-grab is disgusting to look at. But do not throw the baby out with the bathwater.

Re: Ethereum Is a Dark Forest

#67

Earlier quoted context omitted.

I have the feeling that there might actually be more "professional DeFi thought leaders" out there than people who have deployed something to Ethereum.

Is DeFi an actual thing, or just a term for cryptocurrencies in general?

https://defipulse.com/ is a good dashboard that highlights the amount of money "locked" (i.e. as collateral) in various DeFi protocols. It currently indicates $8 billion USD worth of locked funds.

In reality, the number is lower, because folks use "yield farming". You can put some collateral in one protocol, use that to mint some funds, and then collateralize that in another protocol. And rinse and repeat. There was a Twitter post[0] recently where someone analyzed this, and they found that the "true" TLV was more like ~3.5 billion out of $6.7b.

The space is growing quite quickly. A month ago, the TLV was 50% of what is was right now.

[0]- https://twitter.com/damirbandalo/status/1295089928901140481

Re: Ethereum Is a Dark Forest

#68

Earlier quoted context omitted.

They can't.

So, assuming the original person in TFA had some kind of authentic claim on the money, why are they not losing it according to GP?

They (by accident) put the money in a spot where anyone can claim it. Arguably, that's where they lost it, OP just tried to recover it without someone else noticing "ohh, there's free money there" and failed. (that's not a very satisfying answer, but pretty much seems to be the logic behind those things)

Re: Ethereum Is a Dark Forest

#69
post #52

Writing this sort of bot seems like a legitimately fun and interesting thing to work on, but somehow I have less than zero interest in actually doing it. There's just something intrinsically repulsive about the entire blockchain world to me where I just don't want to touch it. I don't mean to offend people who do love blockchain tech, in many ways I don't blame you. But is this feeling I have somewhat common? I'm not…

I have it too. I'm not entirely sure where it comes from, but some significant factors are:

1) Proof-of-work systems are pure, unadulterated energy waste (and an ecological disaster as long as we depend on fossil fuels). They cannot, ever, be allowed to become significant in the economy, lest our future will be building a Dyson sphere around the Sun just to power everyone's ability to pay for a hot dog on their way to work.

2) There are a lot of naive ideas about how economy and society works surrounding major cryptocurrencies.

3) The main users of cryptocurrencies are (AFAIK) criminals and amateur financial speculators.

4) Statistically, you can expect any random startup in this space to be a scam.

It's a wild west. Trading unregulated money tends to disproportionately attract the worst kind of people.

Re: Ethereum Is a Dark Forest

#70
post #67

Earlier quoted context omitted.

Is DeFi an actual thing, or just a term for cryptocurrencies in general?

https://defipulse.com/ is a good dashboard that highlights the amount of money "locked" (i.e. as collateral) in various DeFi protocols. It currently indicates $8 billion USD worth of locked funds. In reality, the number is lower, because folks use "yield farming". You can put some collateral in one protocol, use that to mint some funds, and then collateralize that in another protocol. And rinse and repeat. There was…

Hmm, okay, but what is it?
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