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Is Blockchain Really the Killer App?

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Re: Is Blockchain Really the Killer App?

#81

Post by joe_coin »

drcode wrote: post #23

> I am presently incapable of seeing how any token other than Bitcoin will be the one that wins. In some sense, Bitcoin has already "won" in that it currently has a non-zero value. Anyone who says "Bitcoin can't possibly exist or hold value" already is known to be wrong, simply by Bitcoin's existence. In the same way, I don't understand people like OP who say "No other cryptocurrency but Bitcoin can have value" becau…

To be clear, I don't claim that non-Bitcoin cryptocurrencies do not have value. You're right that their de facto value is revealed through trading activity on exchanges. I view value as subjectively revealed by market prices, not through any sort of labor theory of value or other nonsense.

I'm arguing that non-Bitcoin CCs don't really add any marginal value to the CC ecosystem, and that it's inherently unstable for multiple CCs to coexist. Whatever rationalizations people are making to justify mining Litecoin and holding onto it (ignoring sunk costs of Scrypt ASICs) are inconsistent with reality.

Re: Is Blockchain Really the Killer App?

#82

Post by nrb »

paulsutter wrote: post #22

TL/DR: the Blockchain only wins if Bitcoin wins, because miners need an incentive to mine. "...the Bitcoin Blockchain cannot win without Bitcoin as a currency winning too, but if the Bitcoin price languishes, the incentive mechanism backstopping the Blockchain will be weak and therefore unreliable, ..."

Why wouldn't companies who rely on the blockchain step in and incentivize the miners to ensure the health of the network?

Re: Is Blockchain Really the Killer App?

#83

Post by joe_coin »

lmm wrote: post #79
gutnor wrote: post #56

Earlier quoted context omitted.

Hmm, that got me thinking, I think I get your point generally that bitcoin is more an investment than a value storage and that you would be a fool ( at this stage anyway ) to talk about it as if it was. However, in general what currency has a value proportional to its benefit to mankind ? Any fiat currency are going to be out for the same reason than bitcoin is out, any traditional currency based on gold/silver/shell…

Fiat is just an IOU, it's worth exactly what it's worth. There's a small admin cost to e.g. printing notes, but it's tiny in proportion to the overall currency value. Bitcoin is unique because it has a big negative externality - a huge amount of energy is simply thrown away, powering computers to do something non-worthwhile. A bitcoin is an IOU for something that's already been spent.

I would point out that you're not making a fair comparison to the cost of administering a fiat system. In the US, it includes the cost of the entire Federal Reserve apparatus dedicated to managing the supply of FRNs. Treasury's printing of them is only one small part. The Fed has buildings to maintain, support employees to pay, behind-the-scenes political processes that play out and who knows what changes hands there in exchange for appointments and other policy stances.

You're right that Bitcoin by nature includes a huge energy cost, but when you take the narrow view that it's simply being thrown away, it's both short-sighted that it ignores the theoretical possibility that its heat "waste" could be channeled into something economically desirable (e.g. steam to drive turbines), as well as not an even-handed to comparison to the true costs of its alternatives.

Re: Is Blockchain Really the Killer App?

#84

Post by joe_coin »

sliverstorm wrote: post #35
na85 wrote: post #16

Earlier quoted context omitted.

That seems self defeating. None of the advantages of a decentralized system are realized by centralizing the blockchain

That's perhaps my favorite part of Bitcoin. For good or bad, it was started by people rallying against the big centralized banks, and now at every turn we are hitting reasons why centralization makes a lot of sense. I half suspect that eventually it will come to resemble the current centralized systems, whether people want it or not. For example, the number of complete blockchains is dwindling as more people individu…

I agree with you 100% silverstrom and have another post to that effect brewing.

Re: Is Blockchain Really the Killer App?

#85

Post by nivertech »

wyager wrote: post #77
nivertech wrote: post #69

While in theory Bitcoin can be adapted to "2.0 features" and beyond, in practice it's impossible. Bitcoin code, protocol and marshaling formats are a mess. Bitcoin blockchain and transaction data structures make too many hardcoded assumptions about underlying application - payments with a single token. Bitcoin scripting language was designed for transaction validation only, which makes implementing a smart contracts…

> Bitcoin code, protocol and marshaling formats are a mess. Which is why people are working on e.g. Libconsensus. There are dozens of functional Bitcoin clients based on entirely different codebases, which indicates that it's entirely possible to start from scratch. >payments with a single token. While the Bitcoin transaction format is a bit inflexible, you're wrong about the assumptions it makes. Even from the begin…

You can find a list of Bitcoin script shortcomings in the Ethereum whitepaper and Ethereum Design Rationale document.

Writing a BIP to add a new opcode for every possible transaction type is not the answer. And still I don't see how multisig or P2SH can use something else than BTC tokens (colored coins require external asset registries).

Re: Is Blockchain Really the Killer App?

#86

Post by joe_coin »

fryguy wrote: post #17

I don't necessarily agree with the conclusion at the end. Supposing that sidechains can be mined simultaneously with the bitcoin at no additional cost, and that there is a fixed bitcoin sidecoin conversion ( not market based) built in to the protocol, bitcoin would never completely lose its value, because it could be converted to sidecoin at the same rate it would be before. The market price would be fixed to some sm…

Is that really what Sidechains are aiming for? If so I need to go back and reread their paper more carefully.

What I'm hearing you describe is that the token used by a Sidechain is not one iota different from any other Bitcoin, except perhaps that its latest output script includes some new weird feature we haven't seen yet. It's like my sending you 1.0 Bitcoin through a vanilla BTC transaction and you telling me that I now possess 10e8 Satoshis, which are different that Bitcoin but always redeemable for Bitcoin pegged at that rate.

If tokens being used by Sidechains are permanently pegged to Bitcoin, and we assume merged mining, I withdraw my objection to the concept, and would instead direct my criticism toward how the concept was presented and its seeming suggestion that Sidechain tokens might one day detach and rise in value while Bitcoins potentially fall to zero.

Re: Is Blockchain Really the Killer App?

#87

Post by baddox »

TeMPOraL wrote: post #59
baddox wrote: post #52

Earlier quoted context omitted.

The trouble I have is with your claim that cryptocurrency produces "nothing of absolute value at all." I don't know your definition of "value," but it's clearly not one I share.

I prefer to use the word "upkeep". Money is not something that has intrinsic value in itself. It's what we need because as a species we're too dumb to handle planetary-scale resource allocation. It's a waste we need to get what we want. But since it's a waste, it would be good to reduce it as much as possible.

I have no problem with saying that traditional money and cryptocurrency has no intrinsic value, but mostly because I think the concept of "intrinsic value" is rather useless.

Re: Is Blockchain Really the Killer App?

#88

Post by baddox »

TeMPOraL wrote: post #66
vertex-four wrote: post #63

Earlier quoted context omitted.

On the other hand... the existing financial industry - even just the bits around creating and storing currency, and handling transactions - is rather a massive waste too. If it's possible to replace that with something that (a) gives more power to the people and (b) requires fewer people to run, that's probably a good thing - no comment on whether Bitcoin is that something.

I totally agree. Existing financial industry is a huge waste too (sadly, not many seem to see it that way). But Bitcoin, from what I read about it, seems to have an exponential hunger for power which doesn't lead me to believe that if it replaces current system, we'll be better off.

I think the problem is that you are predicting the viability not of Bitcoin itself, but of your specific assumption about how Bitcoin might be used. I presume you are implying that Bitcoin could not possibly replace the current system, in the sense that it could not efficiently handle all global monetary transactions. Of course this is true by design, and will always be true barring some significant changes to the software. But that is not the only conceivable sense in which Bitcoin could be considered successful and widely used.

Re: Is Blockchain Really the Killer App?

#89

Post by hueving »

TeMPOraL wrote: post #57
hueving wrote: post #50

Earlier quoted context omitted.

The way you're defining value is meaningless if you think the tulip bulbs didn't have value during that time. You could trade one for a house during their peak, sounds pretty valuable to me.

Thus highlighting the difference between monetary value and what is actually useful. It's a difference people get confused about too often - thinking that the most important thing on the planet is the economy; thinking that everything is fungible because it has dollar value. It's all fun and games until we hit resource limits of the planet. Or kill someone. Our economy sucks at pricing in the fact that while we can s…

Your definition of 'actually useful' is going to be different than everyone else's. Economic value is the only objective value we have.

Re: Is Blockchain Really the Killer App?

#90

Post by prawn »

codexon wrote: post #54
prawn wrote: post #44

Earlier quoted context omitted.

"value for the economy as a whole" You've shifted the goalposts there from "has value" to "value for the economy as a whole". If I have money in a ponzi and can exit at that point in time, my stake has value. Later it might not, but at that point it does.

So you are saying that drcode means cryptocurrency has value as a ponzi scheme?

?!? No.
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