#ngmi
My Opinion on Blockchain
71–80 of 107 posts
Re: My Opinion on Blockchain
#72Earlier quoted context omitted.
The problem with the argument is it always ends up circular to some extent. I always see something like the below - where crypto enthusiasts always try to argue bitcoin is something different than the current argument being levied against it... Crypto Enthusiast: "Bitcoin is a currency" Crypto Sceptic: "Well it's not a very good currency because of X, Y & Z reasons, and nobody is spending it" Crypto Enthusiast: "Well…
Fair point. Bitcoin is a precious metal without intrinsic value :) You can argue for the other points in this circle, but really the thing it's closest to is some sort of gold/silver that you can't use for anything else. I guess it can be used as a currency much easier than gold can be, but in general nobody really does.
In that case you are just arguing that something is arbitrarily valuable because it is valuable though, presumably?
So why would I want to invest?
Re: My Opinion on Blockchain
#73I feel like the author here really misses what makes this movement in technology interesting, and that is evident in the title. Blockchain is not the innovation, distributed ledgers are. Blockchain is just one component in one formula that made it work. When you take DLT as the focus, you can examine how disruptive the technology CAN be on traditional ledger systems that require enormous amounts of human energy to ma…
Can you name one specific use case you see distributed ledgers being useful?
* Example 1. Look at Uniswap, it's an unstoppable exchange that is a tiny program in terms of lines of code on the blockchain. The team is tiny. And the thing sees $2 billions of volume every day. Imagine, say, stock being digitized onto a trustless system like this. Every exchange out there, clearing houses, market makers, millions of jobs (not a good thing, but just a reality) would become obsolete. You just don't see the complex process of how transactions happen in real life because there is a massive system that's evolved over many decades to make it happen. Also note that majority people in developing countries don't have access to a bank, much less investment vehicles so the "non-distributed ledger" cannot even reach them. But internet can!
* Example 2. Alexey Navalny is a Russian opposition politician. What the state practices routinely is coming up with fake court cases and freezing assets of his team, their families and even their neighbors. People in US in Europe are very trusting to the banking system because they do not have thing like these happen to them routinely. A counter-example is my beloved Argent wallet. Argent is an example of a "contract wallet" with social recovery. In other words it's a place to store tokens (for examples ones that represent USD) that comes with a complex system of security measures. And there are no middlemen to this system. Nobody can freeze the account, or even steal your phone and try to transfer the account to them, they would hit a hard limit writ into the chain. These systems are still evolving but I gladly and proudly make use of them now.
Re: My Opinion on Blockchain
#74I am enjoying reading articles like this since Bitcoin was $300. There will still be skeptics when Bitcoin will be $100,000 or more, I am certain of that.
Every buyers including me just try to make some USD from something that claims to replace USD...
I am spending bitcoins with BTC-linked debit cards (and earn half of my income in crypto). Living in the future, perhaps. :)
Re: My Opinion on Blockchain
#75I am enjoying reading articles like this since Bitcoin was $300. There will still be skeptics when Bitcoin will be $100,000 or more, I am certain of that.
Every buyers including me just try to make some USD from something that claims to replace USD...
Or perhaps you're trying to obtain goods and services commonly denoted in USD, but believe USD is depreciating against BTC so until purchase, sell your USD.
Re: My Opinion on Blockchain
#76> they say that the fact that it is deflationary and can not see inflation is a good thing, when it is actually a bad thing. There is a reason the target inflation is at ~2% almost everywhere. We need inflation to keep the economy going. And what is the magical reason why we need to keep the economy going? We're burning through this planet's resources much faster than they are being replenished. The economy needs to…
Then why waste electricity in the equivalent of Denmark on math puzzles just to write 1MB of data every 10 minutes?
So you decide whats a waste of energy then?
Here watch this: https://www.youtube.com/watch?v=xLYYh4aPXAM
Bitcoin mining allows energy companies to de-risk an investment in green energy solutions such as solar. If you place some miners onsite you always have full demand (which is a problem during peak production times). Bitcoin mining is a energy revolution.
Re: My Opinion on Blockchain
#77Earlier quoted context omitted.
> - Presumably more people will be online, and more ways to use crypto will be released. Bitcoin launched in 2007. Facebook opened to the public in 2006. One of those has 3 billion users, the other can't get out of the basement. Why haven't we seen more of those ways yet? > It's still very early days for crypto Facebook is one year older, and it's now basically a nation state in power and scale. When will it stop bei…
Crypto total market cap is over $1 trillion, and Bitcoin represents 60% of that. It’s much more valuable than Facebook.
I'm skeptical that market cap is a useful metric here. Owning a cryptocurrency doesn't entitle you to a share of the value generated by that currency, so it's not clear why multiplying the price of 1 BTC by 21 million should produce a meaningful estimate of how much Bitcoin as a whole is worth.
Re: My Opinion on Blockchain
#78Here are some things that people miss when having arguments like these. * Blockchain is not Bitcoin. Bitcoin is the first (and quiet primitive) PoC implementation of the technology. * Blockchain is not "cryptocurrency". Blockchain is just numbers and an ability to trustlessly and safely flip those numbers. What those numbers mean to people is secondary. * To build on the previous point. Blockchain is being used to re…
Exactly. What people don't seem to realize is that blockchain isn't even about cryptocurrency, its primary use case and probably why it is so maligned, is that it will eliminate the middlemen who act as the fiduciary for financial transactions and replace them with algorithms. One reason the SEC has not come after Bitcoin or Ethereum is because they are NOT investments and are not sold as such.
Well put. I think people don't understand how many people and systems are involved in making any kind of financial transaction. That it works relatively seamlessly is because there are hundreds of thousands of people, centuries of experience and relationships of trust behind the scenes making sure it's all smooth.
Also, I think it pays to keep in mind that 1.7 billion people (according to world bank) are unbanked and have no access to any kind of financial products at all. So for all the age and convenience of the system it's reach is faitly limited.
Re: My Opinion on Blockchain
#79I feel like the author here really misses what makes this movement in technology interesting, and that is evident in the title. Blockchain is not the innovation, distributed ledgers are. Blockchain is just one component in one formula that made it work. When you take DLT as the focus, you can examine how disruptive the technology CAN be on traditional ledger systems that require enormous amounts of human energy to ma…
I keep hearing this, that blockchain is, of itself, an interesting solution to problems we are having. But I don't see any evidence of it.
I tend to agree with the author, that blockchain doesn't solve any problems that can't be solved better by a database. So far, no-one has come up with a problem outside of cryptocurrency that actually needs a blockchain to solve it.
The only evidence of any innovation that I see (and I'm not that into the space, so I'm probably missing things) is scammers learning how to scam better.
Given that currency is actually this great use case for blockchain, can we solve the outstanding issues for that? Bitcoin has some serious problems with transaction speed that stopped it from being used as an actual currency. Can we solve those yet? Can you actually buy a coffee with a cryptocurrency without having to wait 10 minutes for the block to resolve and confirm? If so, can we actually use that as a currency?
Re: My Opinion on Blockchain
#80Earlier quoted context omitted.
If you believe that (and it's a legitimate point of view), investing in Proof of Work secured cryptocurrencies is a terrible way of putting that belief into action, as PoW burns enormous amounts of resources merely maintaining the ledger of people HODLing their hoards.
I think this is an interesting point however, banks today aren't just their IT infrastructure. For banks to function there are so many things that have to work, right down to the local branches and ATMs (and physically moving money around). I think this burning enormous amounts of resources argument isn't fully fleshed out yet. You almost have to think about the entire banking system and compare that to the entire cr…
I'm sure the existing banking system takes energy+other resources to maintain. But the incentives in the existing banking system are to look for ways to use LESS of these. Each Kilowatt-hour a bank doesn't use shows up in their bottom line.
Proof of works is DESIGNED to waste energy. If tomorrow, you'd make hash computations 1000x as energy efficient, the hashing difficult is designed to adjust to make sure that 1000x as many computations are performed and the same amount of energy is wasted.
Think of it this way: Currently, 900 bitcoins are mined per day. At a price of $40K per bitcoin, whoever mines those bitcoins earns a combined $36M. So miners are incentivized to invest approximately that much money into energy & equipment per day (minus some profit margin). If they invested substantially less, somebody could invest more and pick off their coins. (And that's counting only mining profits. There are also transaction rewards, and, if you were to control a majority of mining, more nefarious sources of profit).
This means that PoW has some truly perverse incentives:
* Industry wide energy efficiency does not matter, because the difficulty will adjust accordingly.
* The higher the bitcoin price rises, the MORE energy gets wasted (That's a big difference with e.g. Gold. Sure, rising prices lead to more marginal deposits being exploited, but it's not like pickaxe prices for a given prices rose proportionally with gold prices).