Why “blockchain” is BS in 4 slides • Hacker News Board

Re: Why “blockchain” is BS in 4 slides

#81

Post by lojack » Sun, Apr 01, 2018, 10:20 PM UTC

JumpCrisscross wrote: post #44

cornholio wrote: post #32

There is some truth in the slides but it's well mixed with falsehoods and misunderstandings. * Distributed consensus schemes are not useful only for monetary applications. When they are used as such, there exist mechanisms to commit to a certain fiat price and minimize market exposure to the point where transactions are almost free, in fiat terms. * The disbursement of tokens and the distributed consensus rewards do…

> smart contracts and distributed algorithms enable control mechanism and hard guarantees that have no old world equivalent, they can eliminate counterparty risks, guarantee solvency and fair arbitration etc. The required nexus between the blockchain and the tangible and legal worlds means every limitation that exists today will exist for a "smart contract". It's the same plumbing with a paint job.

This risk can be mitigated by bridging the real world and the blockchain using oracles. This risk mitigation can be somewhat decentralized using a voting or reputation mechanism. This is by no means perfect, and I'm not aware of any trustless mechanisms for this, but its a problem people are currently working on, and I think there will eventually be a good solution.

I also don't think this is a false dichotomy. Most likely we'll end up at a place with some improvement over what we have today (I'd actually argue we're currently at this point now) but not without all of the limitations.

Re: Why “blockchain” is BS in 4 slides

#82

Post by wellboy » Sun, Apr 01, 2018, 10:21 PM UTC

logicallee wrote: post #73

wellboy wrote: post #63

Earlier quoted context omitted.

Blockchains are moving away from PoW to PoS, which requires a millionth of the energy use, so that's not really an argument.

Kindly elaborate. Which ones? To what extent? What is the state of the art here? This was my only issue with bitcoin when I evaluated it several years ago.

Pretty much all the newer ones, Nano, Iota and Eth probably soon to.

There is also a debate to use delegated PoS or a hybrid of PoS and PoW to get both of their upsides with none of tbeir downsides.

Re: Why “blockchain” is BS in 4 slides

#83

Post by cachvico » Sun, Apr 01, 2018, 10:22 PM UTC

dlp211 wrote: post #60

fruitzome wrote: post #51

Earlier quoted context omitted.

2B+ people do not have access to banking or trade. They are poor because we do not trade with them. I couldn't pay someone in South Africa rural area for something worth $2 without bitcoin. Many other people are censored. Billions more have their wealth devalued via inflation. Bitcoin is a way for people to be free without any state taking their money (see Greece)

So these people are essentially poor and don't have access to trade and Banking, but they are going to have access to the blockchain, hardware wallets, and the various other technologies they need, and this will all happen before banks or mobile app payment systems are able to capture the market? Call me a skeptic.

Yes. The implication is that the 2B unbanked will get access to a cheap Android, and therefore ability to trade instantly with anyone anywhere with no fees, before the banana state fixes their massively corrupt government.

Re: Why “blockchain” is BS in 4 slides

#84

Post by lojack » Sun, Apr 01, 2018, 10:23 PM UTC

dozzie wrote: post #68

cornholio wrote: post #32

There is some truth in the slides but it's well mixed with falsehoods and misunderstandings. * Distributed consensus schemes are not useful only for monetary applications. When they are used as such, there exist mechanisms to commit to a certain fiat price and minimize market exposure to the point where transactions are almost free, in fiat terms. * The disbursement of tokens and the distributed consensus rewards do…

> * Distributed consensus schemes are not useful only for monetary applications. OK, but blockchain is not a distributed consensus protocol. It's a document timestamping protocol.

Yes, a document timestamping protocol that we reach a consensus on in a distributed fashion. I'm not sure why a document timestamping protocol can't also be a distributed consensus protocol?

Re: Why “blockchain” is BS in 4 slides

#85

Post by asfgjadfgionoin » Sun, Apr 01, 2018, 10:24 PM UTC

mjamesaustin wrote: post #2

Isn't he discussing cryptocurrencies in particular rather than blockchain in general? There are many uses for blockchain other than as a cryptocurrency. Correct me if I'm wrong - I'm not an expert in blockchain by any means.

>There are many uses for blockchain other than as a cryptocurrency.

Name one.

Re: Why “blockchain” is BS in 4 slides

#86

Post by cocktailpeanuts » Sun, Apr 01, 2018, 10:25 PM UTC

cornholio wrote: post #49

kbenson wrote: post #16

Ethereum smart contracts are million dollar bug bounties? That sounds about right to me, and seems historically accurate.

What does that actually mean in practice? Any successful piece of code is a million dollar bug bounty. A Windows remote execution can sell for millions and do damage in the billions. Is it easy to exploit smart contracts? Is it fundamentally impossible to make them secure? Maybe we lack the proper tools, maybe current architectures need to be improved.

It's different from Windows bug because Windows bugs can be easily patched.

When we come to blockchain world, we run into a dilemma:

1. Hard-forking means it's no longer truly "immutable"

2. Not Hard-forking means we're fucked.

The first point is important even if you're not an immutability nerd, and most people don't realize the significance of a truly ownerless ledger because most people haven't thought really deep into how the society and economy works.

In my opinion the difference between a truly ownerless ledger and another one that has made 0.1% tradeoff is as different as the difference between selling something for 1 cent and giving it away for free.

I think blockchains like Ethereum that want to become general purpose will have tendency to move towards being more centralized. Not saying that's bad, it's a tradeoff, but nobody knows what the end result would be. It could end up becoming like the Web, where the protocol itself is supposed to be decentralized but every user facing stuff is completely centralized.

Re: Why “blockchain” is BS in 4 slides

#87

Post by asfgjadfgionoin » Sun, Apr 01, 2018, 10:27 PM UTC

dozzie wrote: post #68

cornholio wrote: post #32

There is some truth in the slides but it's well mixed with falsehoods and misunderstandings. * Distributed consensus schemes are not useful only for monetary applications. When they are used as such, there exist mechanisms to commit to a certain fiat price and minimize market exposure to the point where transactions are almost free, in fiat terms. * The disbursement of tokens and the distributed consensus rewards do…

> * Distributed consensus schemes are not useful only for monetary applications. OK, but blockchain is not a distributed consensus protocol. It's a document timestamping protocol.

True, but in practice "blockchain" implies some sort of distributed consensus.

Except for private blockchains, which are totally brain-dead.

Re: Why “blockchain” is BS in 4 slides

#88

Post by fruitzome » Sun, Apr 01, 2018, 10:38 PM UTC

dlp211 wrote: post #60

fruitzome wrote: post #51

Earlier quoted context omitted.

2B+ people do not have access to banking or trade. They are poor because we do not trade with them. I couldn't pay someone in South Africa rural area for something worth $2 without bitcoin. Many other people are censored. Billions more have their wealth devalued via inflation. Bitcoin is a way for people to be free without any state taking their money (see Greece)

So these people are essentially poor and don't have access to trade and Banking, but they are going to have access to the blockchain, hardware wallets, and the various other technologies they need, and this will all happen before banks or mobile app payment systems are able to capture the market? Call me a skeptic.

A lot of the world lives on less than $2 a day.

You can buy a cheap refurbished Android phone for $5.

And you have SMS cointext.io to transact for instance.

You do not need a hardware wallet, only to memorize the 12 word seed phrase.

Just look at the set of users who have phones without adequate banking. You will see this is measured in the billions of people.

The best hope to lift people out of poverty is for us to transact and deal with these people.

Re: Why “blockchain” is BS in 4 slides

#89

Post by fruitzome » Sun, Apr 01, 2018, 10:40 PM UTC

Retra wrote: post #69

fruitzome wrote: post #51

Earlier quoted context omitted.

2B+ people do not have access to banking or trade. They are poor because we do not trade with them. I couldn't pay someone in South Africa rural area for something worth $2 without bitcoin. Many other people are censored. Billions more have their wealth devalued via inflation. Bitcoin is a way for people to be free without any state taking their money (see Greece)

What are you buying from rural South Africa that's worth $2?

It's none of your business.

But there was some music I paid for online because I liked the sound.

It's awesome that I'm able to support artists and creators across the globe and make a difference in someone's life (as they made a difference in mine).

Transaction cost? 1 cent with Bitcoin Cash. They kept $1.99

Re: Why “blockchain” is BS in 4 slides

#90

Post by as300 » Sun, Apr 01, 2018, 10:42 PM UTC

JumpCrisscross wrote: post #44

cornholio wrote: post #32

There is some truth in the slides but it's well mixed with falsehoods and misunderstandings. * Distributed consensus schemes are not useful only for monetary applications. When they are used as such, there exist mechanisms to commit to a certain fiat price and minimize market exposure to the point where transactions are almost free, in fiat terms. * The disbursement of tokens and the distributed consensus rewards do…

> smart contracts and distributed algorithms enable control mechanism and hard guarantees that have no old world equivalent, they can eliminate counterparty risks, guarantee solvency and fair arbitration etc. The required nexus between the blockchain and the tangible and legal worlds means every limitation that exists today will exist for a "smart contract". It's the same plumbing with a paint job.

I'm sort of thinking out loud here, but the nexus will have to consist of third-party auditors who operate based on reputation.

Right now, we have the government operating as both the "miners" and the auditors.

A middle-ground, then, might be one in which there is a general-purpose public blockchain where the government takes the role of the trusted third-party on-chain, thereby lowering the overall societal costs of things like unfulfilled contracts while still ensuring that my oil-reserves are what I say they are.

From the government's perspective I see this as desirable but falling prey to the principal-agent problem. We'd need virtually no civil-court judges or attorneys to prosecute white-collar crime anymore. It'd lower costs, but in doing so unemploy many of the people in the system.