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>"Bitcoin technologies solved some very important problems in the creation of currencies: double spending, decentralization, cost distribution, &c. These are no

by Kinnard 11y ago

>"Bitcoin technologies solved some very important problems in the creation of currencies: double spending, decentralization, cost distribution, &c. These are not problems that need to be solved in securities trading. One company running on one platform doesn't have a double spendng problem. Decentralization is irrelevant. And cost is no issue." You're thinking of the securities trading of today, which has its roots in the 16th Mercantile Revolution of Europe. Securities are still essentially pieces of paper: stock certificates. If you've started a company(assuming it was a C-Corp) you know this system is shit. While this is the case, equity markets, for all that's been developed are like rocket ships tethered to the ground. In the future you will be able to do business globally the way you can communicate globally today. That means not just transacting money, but assets as well. Bitcoin is a system of digital tokens, which can represent anything. For this, you do need the trustless transactions that the blockchain enables. Would you trust a Russian stock market? Russia has very different ethical standards and very different laws. What if you are declared a persona non grata and your assets are to be confiscated? What if Russia and the United States go to war? What about a Nigerian stock exchange? Would it be reliable? Your reluctance to engage in these markets means entrepreneurs there do not have access to capital. Math and the laws of computation are the same everywhere. This allows for new types and a level of global commerce that will change the world the same way global communication did. Bitcoin is way, way more than a currency. It allows assets to flow like email. And that is just the beginning.

kolbe 11y ago
Equity markets have the DTCC and registered exchanges. Even though there are some 16th century pieces of paper still around today, actual transfer of equity from one party to another is little more than an exchange notifying the DTCC that a transaction took place, and the DTCC changing a log in its own database moving the stock from one clearing firm to the other. That sounds boatloads more efficient that blockchain already. There are other security markets that do not operate as efficiently, but to me, the solution looks more similar to the DTCC model, not the blockchain model. Keep in mind, too, we still do not have any system that reasonably ties bitcoin technology back to a real-life asset. Bitcoin works because it's self-contained. In the world you described, I could have all the necessary ones and zeros to represent an ownership stake in a Nigerian oil company, but that means diddly squat if it's impossible for me to exert control on the company or receive dividends. Nigeria nationalizing the rigs has nothing to do with whether or not I have a claim on it with a piece of paper from an exchange or a cryptographic key. Those are currently real-world issues impairing investment in those regions, not the exchanging mechanisms. Though I do concede, the exchanging mechanisms aren't perfect.
grey-area 11y ago
Bitcoin is way, way more than a currency. It allows assets to flow like email. And that is just the beginning. Bitcoin is not required for that, it's not even very good at it. Cryptographic signing of assets, asymmetric public-key cryptography, digital certificates, etc are not unique to bitcoin and a far simpler system with far fewer fundamental flaws and third party dependencies could be constructed if you want to track assets and replace paper certificates. Trustless, pseudo-anonymous transactions are significantly less useful than verified identity transactions with reversibility, central authorities, regulation, insurance, etc. There are a lot of properties of bitcoin that make it wildly unsuitable for tracking financial assets (or as a digital currency). Would you trust a Russian stock market?...Your reluctance to engage in these markets means entrepreneurs there do not have access to capital. How does Bitcoin solve the problems of world peace and corrupt regimes? A simple rubber-hose attack will render up your key or the computer your coins reside on just as it will any other asset, and other assets can be appropriated whether stakes of ownership are stored via the blockchain or not.

by Kinnard 11y ago

kolbe 11y ago

Equity markets have the DTCC and registered exchanges. Even though there are some 16th century pieces of paper still around today, actual transfer of equity from one party to another is little more than an exchange notifying the DTCC that a transaction took place, and the DTCC changing a log in its own database moving the stock from one clearing firm to the other. That sounds boatloads more efficient that blockchain already. There are other security markets that do not operate as efficiently, but to me, the solution looks more similar to the DTCC model, not the blockchain model. Keep in mind, too, we still do not have any system that reasonably ties bitcoin technology back to a real-life asset. Bitcoin works because it's self-contained. In the world you described, I could have all the necessary ones and zeros to represent an ownership stake in a Nigerian oil company, but that means diddly squat if it's impossible for me to exert control on the company or receive dividends. Nigeria nationalizing the rigs has nothing to do with whether or not I have a claim on it with a piece of paper from an exchange or a cryptographic key. Those are currently real-world issues impairing investment in those regions, not the exchanging mechanisms. Though I do concede, the exchanging mechanisms aren't perfect.

grey-area 11y ago

Bitcoin is way, way more than a currency. It allows assets to flow like email. And that is just the beginning. Bitcoin is not required for that, it's not even very good at it. Cryptographic signing of assets, asymmetric public-key cryptography, digital certificates, etc are not unique to bitcoin and a far simpler system with far fewer fundamental flaws and third party dependencies could be constructed if you want to track assets and replace paper certificates. Trustless, pseudo-anonymous transactions are significantly less useful than verified identity transactions with reversibility, central authorities, regulation, insurance, etc. There are a lot of properties of bitcoin that make it wildly unsuitable for tracking financial assets (or as a digital currency). Would you trust a Russian stock market?...Your reluctance to engage in these markets means entrepreneurs there do not have access to capital. How does Bitcoin solve the problems of world peace and corrupt regimes? A simple rubber-hose attack will render up your key or the computer your coins reside on just as it will any other asset, and other assets can be appropriated whether stakes of ownership are stored via the blockchain or not.