10 ms·

Ask HN: Why is the community so negative towards blockchain technology?

86 points by merrickread 10y ago

I'm hoping to have a technical discussion, emotions aside.

chollida1 10y ago
As someone in finance, where blockchain gets brought up alot, this one is easy. Blockchain is the proverbial solution looking for a problem. As has been pointed out ad nauseam, the blockchain is often just a euphemism for database. And that's where the backlash comes from, someone says Blockchain for settlement, or blockchain for recording startup up option tracking, or blockchain for tracking, well anything physical or digital. The problem with these solutions is that almost always, there exists a database doing exactly what the person is proposing we use blockchain for, there aren't any trust issues with the counter parties so distributed consensus doesn't buy you much, often it makes things worse due to its immutability. Couple that with the fact that many people like the current system, or make money based on the current system and therefor can't see anything broken about it. Also, the current technology has inertia behind it, the new technology can't be just a bit better, it needs to be much better to displace the incumbent tech, and blockchain just isn't that much better yet for most of the soutions its proposed for. TL/DR Blockchain is the new NoSql. Awesome, useful in very strict cases, but its currently supremely hyped up and over sold.
- merrickread 10y ago
  I completely agree, it sounds like the forever present problem of wrong tool for the right job. However it offers the potential to approach problems in a fundamentally different manner. I find myself incredibly curious and fascinated with how it works - then immediately rejected once I see discussions on HN about the blockchain. According to your bio you've been programming for many years - is an apprehension towards something new a common pattern you've observed?
  - wmf 10y ago
    To many people on HN, blockchain isn't new; many of us have gone through the incredibly curious and fascinated stage around 2011-2013 and are now in the cynical and grumpy stage. If you're curious about this stuff keep learning but HN and Reddit probably just aren't good places to do so.
- npezolano 10y ago
  To comment on the use case of faster than T+3 settlements using the block chain. You have to keep in mind many of these instruments trade monthly at best.
- zamalek 10y ago
  > supremely hyped up and over sold. Which results in "hype recoil." There are some interesting use-cases for the technology, but the hype in areas where it is not applicable (e.g. as a liquid currency) severely erode the overall perception. Fanatic belligerence when the flaws are discussed enrich angst toward the technology. In many ways the issue is not the technology itself; rather the evangelists of it.
kyleschiller 10y ago
It's just backlash against the hype. It's sort of hard to have a technical discussion since people aren't usually negative towards it for technical reasons. Blockchain is a relatively new technology with plenty of promises paired with low understanding.
SnakePlissken 10y ago
I think the negativity is more focused on the "blockchain will revolutionize x industry" hype than on the blockchain technology itself. I've noticed a similar (and justified) degree of skepticism and fatigue here in regard to all of the AI hype in mainstream media, but nobody is discounting the technical advances made in the field; just the kind of unbridled, naive optimism that played a part in the "AI Winter" of the 80s and could lead to a similar disillusionment with the blockchain.
twinkletwinkle 10y ago
To quote Matt Levine: "If you announce that you are updating the database software used by a consortium of banks to track derivatives trades, the New York Times will not write an article about it. If you say that you are blockchaining the blockchain software used by a blockchain of blockchains to blockchain blockchain blockchains, the New York Times will blockchain a blockchain about it" The whole article is fairly insightful, as his often are: https://www.bloomberg.com/view/articles/2017-01-10/bank-blockchains-and-an-alibaba-box https://www.bloomberg.com/view/articles/2017-01-10/bank-bloc... The article on the front page about Accenture today is a great example. People are using it as a buzzword. Blockchain isn't snake oil, but it's sure being peddled by a lot of snake oil salesmen.
- m-i-l 10y ago
  And to quote Tracy Alloway, also Bloomberg: "you can replace the term 'distributed ledgers' with 'shared Excel sheets' in about 90 percent of talk about blockchain and finance"[0] [0] http://www.tracy-alloway.com/?p=577 http://www.tracy-alloway.com/?p=577
gue5t 10y ago
It isn't negative towards the technology. Blockchains solve one problem: distributed consensus among mutually distrustful peers. If there's any existing trust structure, then a blockchain isn't what you need. In situations where you already have trust but want immutability and cryptographic assurances, you may want to look into Merkle DAGs or other authenticated data structures, which are not blockchains at all. https://cs.umd.edu/~mwh/papers/gpads.pdf https://cs.umd.edu/~mwh/papers/gpads.pdf
- zaphar 10y ago
  Exactly. The most valuable part of the blockchain technologies for most big news announcements tend to be the Merkle DAG piece not the distributed consensus. Frankly the distributed consensus part of blockchains has always seemed more than a tad bit wasteful of energy and computation.
Perceptes 10y ago
It may not be a direct answer to your question, but this article has a cynical (yet technically detailed) perspective on "blockchain" that might give some insight: https://tonyarcieri.com/on-the-dangers-of-a-blockchain-monoculture https://tonyarcieri.com/on-the-dangers-of-a-blockchain-monoc...
reitanqild 10y ago
I'm not negative to blockchains like I'm not negative to linked lists. I am however sceptical when large amounts of people suddenly decides that they need to swap technology NOW. Example: javascript. A language that IMO is worse than even php in a number of ways but still manages to attract developer mindshare. (Yes, I have some experience in classic Javascript / ECMAScript )
codexon 10y ago
Regarding bitcoin, the main problem is that a lot of people have large amounts of bitcoin horded from early days and they tend to be biased and start spamming forums about how great it is as it will make them very rich if the adoption increases. This is despite there being very major flaws with the system. As someone that has actually tried to sell things with bitcoin, there are major flaws with it, and they will never be fixed because these problems are inherent to blockchains. And people trying to get rich quick keep spamming forums and HN with blockchain technology X Y Z without acknowledging these problems. 1. It is really annoying to buy. You need to go out of your way to link your bank account and passport/driver's license at any major exchange, and this takes days or even weeks. You cannot buy it instantly with a credit card or paypal unless you find a shady seller with bad rates. No one wants to sell bitcoin for something that could be chargebacked. 2. No chargebacks. Good for sellers but not for buyers. People might be able to live with this if it weren't for the other 2 major problems. 3. Payment takes forever. Waiting for the recommended amount of confirms will take at least an hour? These problems are deal-breaking and can never be fixed when using blockchain technology.
- wc23 10y ago
  The term confirmation is a bad one. It gives people the impression that they have to wait 10 might.s to an hour to know if they have their money. The moment you see a transaction in you wallet, you have it, you just have to wait 10 mins to an hour to spend it. So to compare this to legacy systems which take 3-5 days and claim its too slow seems unfair.
  - NeutronBoy 10y ago
    > you have it, you just have to wait 10 mins to an hour to spend it And then after 10 mins to an hour you find you can't spend it because it's been marked invalid, and the guy you sold your iPhone to is long gone.
  - codexon 10y ago
    What neutron boy said. If you don't wait 5-6 confirmations, it could be a fake transaction. And I can spend money I get from Paypal as soon as I get it. I don't have to wait 1 hour.
patio11 10y ago
Well since you asked. Blockchain is the world's worst database, created entirely to maintain the reputations of venture capital firms who injected hundreds of millions of dollars into a technology whose core defining insight was "You can improve on a Ponzi scam by making it self-organizing and distributed; that gets vastly more distribution, reduces the single point of failure, and makes it censorship-resistant." That's more robust than I usually phrase things on HN, but you did ask. In slightly more detail: Databases are wonderful things. We have a number which are actually employed in production, at a variety of institutions. They run the world. Meaningful applications run on top of Postgres, MySQL, Oracle, etc etc. No meaningful applications run on top of "blockchain", because it is a marketing term. You cannot install blockchain just like you cannot install database. (Database sounds much cooler without the definitive article, too.) If you pick a particular instantiation of a blockchain-style database, it is a horrible, horrible database. Can I pick on Bitcoin? Let me pick on Bitcoin. Bitcoin is claimed to be a global financial network and ready for production right now. Bitcoin cannot sustain 5 transactions per second, worldwide. You might be sensibly interested in Bitcoin governance if, for some reason, you wanted to use Bitcoin. Bitcoin is a software artifact; it matters to users who makes changes to it and by what process. (Bitcoin is a software artifact, not a protocol, even though the Bitcoin community will tell you differently. There is a single C++ codebase which matters. It is essentially impossible to interoperate with Bitcoin without bugs-and-all replicating that codebase.) Bitcoin governance is captured by approximately ~5 people. This is a robust claim and requires extraordinary evidence. Ordinary evidence would be pointing you, in a handwavy fashion, about the depth of acrimony with regards to raising the block size, which would let Bitcoin scale to the commanding heights of 10 or, nay, 100 transactions per second worldwide. Extraordinary evidence might be pointing you to the time where the entire Bitcoin network was de-facto shut down based on the consensus of N people in an IRC channel. c.f. https://news.ycombinator.com/item?id=9320989 https://news.ycombinator.com/item?id=9320989 This was back in 2013. Long story short: a software update went awry so they rolled back global state by a few hours by getting the right two people to agree to it on a Skype call. But let's get back to discussing that sole technical artifact. Bitcoin has a higher cost-to-value ratio than almost any technology conceivable; the cost to date is the market capitalization of Bitcoin. Because Bitcoin enters through a seigniorage mechanism, every Bitcoin existing was minted as compensation for "security the integrity of the blockchain" (by doing computationally expensive makework). This cost is high. Today, routine maintenance of the Bitcoin network will cost the network approximately $1.5 million. That's on the order of $3 per write on a maximum committed capacity basis. It will cost another $1.5 million tomorrow, exchange rate depending. (Bitcoin has successfully shifted much of the cost of operating its database to speculators rather than people who actually use Bitcoin for transaction processing. That game of musical chairs has gone on for a while.) Bitcoin has some properties which one does not associate with many databases. One is that write acknowledgments average 5 minutes. Another is that they can stop, non-deterministically, for more than an hour at a time, worldwide, for all users simultaneously. This behavior is by design. I can go on, and probably will some other day. This is a bit of a hobby for me.
niftich 10y ago
Bitcoin's primary innovation isn't the blockchain per se, but the combination of the blockchain and proof-of-work timestamping to solve the double-spending problem without requiring a central authority. A "private" blockchain largely defeats the point, as you don't need trustless distributed concensus when you implictly trust yourself or a central authority. We just call these versioned databases.
fauria 10y ago
As I see it, Blockchain technology is based on some premises that are not easily achievable. This are the two I find most relevant: 1. A large user base (computational power) is needed to successfully run a blockchain backed product. If the network is small, a malicious attacker with enough resources could manipulate past transactions or prevent new ones (51% attack). 2. Blockchain was designed to be a trustless (no central authority) distributed ledger. In the case of Bitcoin, it prevents double spending of a virtual currency that only exists in the Internet. When applied to "real world" assets, sooner or later you will find a step in the process that involves trusting something or someone. So far I haven't been able to identify a use case for anything but a digital asset with great traction.
- wmf 10y ago
  Bankchains solve #1 by not using mining; they use something like BFT (which is basically Paxos for liars) so that only 51% of the companies in the consortium need to be honest at any one time.
  - fauria 10y ago
    I guess that invalidates by definition #2.
    - wmf 10y ago
      Ah, I forgot to mention that. Bitcoin is totally trustless, while bankchains require the participants to trust each other's identities but not their behavior. Whether this trust model is applicable in any real-world situation is debatable. And yes, if you're using blockchain to track something like gold in a vault you might as well just have a database that is run by the same entity that runs the vault.
vectorpush 10y ago
Blockchain evangelists promise the world and deliver nothing except hype and political grandstanding in return. When we discuss the cryptocurrency concept, specifically bitcoin, I think reasonable people can agree that blockchain technology has yielded something unique, interesting and worthy of technical merit, despite it not living up to the insane prognostications of bitcoin fanatics . On the whole, I think it's fair to call bitcoin a success because it continues to exist and has been self sustaining more or less within the parameters of the original design for quite a few years. Although it is small, there is some real commerce that occurs in the bitcoin world, and even among some of the alt-coins that followed it. A self-sustaining mini-economy based on computer code is fascinating, and without all the breathless evangelists talking about how bitcoin will end all wars and liberate the masses from the tyranny of taxation and government, I think we'd see a lot more meaningful technical discussion of bitcoin and the other potential uses for blockchain technology. But that is not the world we live in. We live in a world where every conceivable problem is met with an overwrought and unworkable blockchain solution. We live in a world where startups can drain 100 million dollars on a clearly stupid idea because "blockchains are the future", we live in a world where bitcoin evangelists refuse to face the reality that the incumbent financial system is not at all threatened by bitcoin and concepts like "smart contracts" and that people with common sense aren't ignorant or misunderstanding blockchains just because they're trying to tell you that throwing millions of dollars into a "decentralized autonomous organization" (a misnomer which exemplifies blockchain insanity) is a dangerous and terrible idea. Blockchain enthusiasts need to put up or shut up. Storing land deeds and stocks on the blockchain is unworkable. Using the blockchain to power smart-locks and self-driving cars and autonomous drones and autonmous AI VCs is unworkable and unnecessary. Bitcoin, bitcoin copycats, and RNG roulette are the only examples of blockchains working mostly as intended and providing at least a marginal utility (in that cryptocurrency can be converted into spendable money). All the rest of it is demonstrably pointless (see literally every project created with etherum besides decentralized gambling software). This is leaving aside all the political nonsense and all the bitcoin hesits, thefts, scams, and buzzword swindling. The bottom line is that people are tired of hearing about the amazing capabilities of blockchains when nobody can seem to actually demonstrate their utility (besides bitcoin) in practice.
chx 10y ago
Blockchain technology? Maybe there's something in the future but right now Bitcoin is mostly used as an illegal vehicle to get money out of China. Some 90% of bitcoin trades originate in China. A lot of people who are peddling Bitcoin are holding on to it and try to convince others to use it so their holdings grow. The whole thing became a scam. The other "alt coins" are even worse, Monero is pushed by drug dealers etc.
deleted 10y ago
[deleted]
bryceweiner 10y ago
These comments are beyond simplistic and illustrate only a basic understanding of Bitcoin and less about how it works. A distributed ledger is a decentralized data store in which the data contained therein is cryptographically validated as true and correct (read: unaltered) as the protocols for communicating that data are Byzantine Fault Tolerant (BFT). A blockchain is a distributed ledger where the transactions are committed to the ledger in batches. That's it. It's that simple. In the financial realm this is beyond valuable in that FI's no longer need trust their employees, not their customers. The means by which the data is secured precludes the need for complex security systems at the network level, reducing entry and operating costs to that of simple disk space. These systems have existed for literally decades but they have languished in obscurity until Bitcoin demonstrated exactly how powerful such systems could be. Edit to add: The benefits become much clearer and simpler to understand once you spit out the Bitcoin koolade.
zackmiller84 10y ago
Reading through the responses from here has made me question my investment in Bitcoin, ShadowCash and Lisk.

86 points by merrickread 10y ago

I'm hoping to have a technical discussion, emotions aside.

As someone in finance, where blockchain gets brought up alot, this one is easy. Blockchain is the proverbial solution looking for a problem. As has been pointed out ad nauseam, the blockchain is often just a euphemism for database. And that's where the backlash comes from, someone says Blockchain for settlement, or blockchain for recording startup up option tracking, or blockchain for tracking, well anything physical or digital. The problem with these solutions is that almost always, there exists a database doing exactly what the person is proposing we use blockchain for, there aren't any trust issues with the counter parties so distributed consensus doesn't buy you much, often it makes things worse due to its immutability. Couple that with the fact that many people like the current system, or make money based on the current system and therefor can't see anything broken about it. Also, the current technology has inertia behind it, the new technology can't be just a bit better, it needs to be much better to displace the incumbent tech, and blockchain just isn't that much better yet for most of the soutions its proposed for. TL/DR Blockchain is the new NoSql. Awesome, useful in very strict cases, but its currently supremely hyped up and over sold.

merrickread 10y ago
I completely agree, it sounds like the forever present problem of wrong tool for the right job. However it offers the potential to approach problems in a fundamentally different manner. I find myself incredibly curious and fascinated with how it works - then immediately rejected once I see discussions on HN about the blockchain. According to your bio you've been programming for many years - is an apprehension towards something new a common pattern you've observed?
- wmf 10y ago
  To many people on HN, blockchain isn't new; many of us have gone through the incredibly curious and fascinated stage around 2011-2013 and are now in the cynical and grumpy stage. If you're curious about this stuff keep learning but HN and Reddit probably just aren't good places to do so.
npezolano 10y ago
To comment on the use case of faster than T+3 settlements using the block chain. You have to keep in mind many of these instruments trade monthly at best.
zamalek 10y ago
> supremely hyped up and over sold. Which results in "hype recoil." There are some interesting use-cases for the technology, but the hype in areas where it is not applicable (e.g. as a liquid currency) severely erode the overall perception. Fanatic belligerence when the flaws are discussed enrich angst toward the technology. In many ways the issue is not the technology itself; rather the evangelists of it.

kyleschiller 10y ago

It's just backlash against the hype. It's sort of hard to have a technical discussion since people aren't usually negative towards it for technical reasons. Blockchain is a relatively new technology with plenty of promises paired with low understanding.

SnakePlissken 10y ago

I think the negativity is more focused on the "blockchain will revolutionize x industry" hype than on the blockchain technology itself. I've noticed a similar (and justified) degree of skepticism and fatigue here in regard to all of the AI hype in mainstream media, but nobody is discounting the technical advances made in the field; just the kind of unbridled, naive optimism that played a part in the "AI Winter" of the 80s and could lead to a similar disillusionment with the blockchain.

twinkletwinkle 10y ago

To quote Matt Levine: "If you announce that you are updating the database software used by a consortium of banks to track derivatives trades, the New York Times will not write an article about it. If you say that you are blockchaining the blockchain software used by a blockchain of blockchains to blockchain blockchain blockchains, the New York Times will blockchain a blockchain about it" The whole article is fairly insightful, as his often are: https://www.bloomberg.com/view/articles/2017-01-10/bank-blockchains-and-an-alibaba-box https://www.bloomberg.com/view/articles/2017-01-10/bank-bloc... The article on the front page about Accenture today is a great example. People are using it as a buzzword. Blockchain isn't snake oil, but it's sure being peddled by a lot of snake oil salesmen.

m-i-l 10y ago
And to quote Tracy Alloway, also Bloomberg: "you can replace the term 'distributed ledgers' with 'shared Excel sheets' in about 90 percent of talk about blockchain and finance"[0] [0] http://www.tracy-alloway.com/?p=577 http://www.tracy-alloway.com/?p=577

gue5t 10y ago

It isn't negative towards the technology. Blockchains solve one problem: distributed consensus among mutually distrustful peers. If there's any existing trust structure, then a blockchain isn't what you need. In situations where you already have trust but want immutability and cryptographic assurances, you may want to look into Merkle DAGs or other authenticated data structures, which are not blockchains at all. https://cs.umd.edu/~mwh/papers/gpads.pdf https://cs.umd.edu/~mwh/papers/gpads.pdf

zaphar 10y ago
Exactly. The most valuable part of the blockchain technologies for most big news announcements tend to be the Merkle DAG piece not the distributed consensus. Frankly the distributed consensus part of blockchains has always seemed more than a tad bit wasteful of energy and computation.

Perceptes 10y ago

It may not be a direct answer to your question, but this article has a cynical (yet technically detailed) perspective on "blockchain" that might give some insight: https://tonyarcieri.com/on-the-dangers-of-a-blockchain-monoculture https://tonyarcieri.com/on-the-dangers-of-a-blockchain-monoc...

reitanqild 10y ago

I'm not negative to blockchains like I'm not negative to linked lists. I am however sceptical when large amounts of people suddenly decides that they need to swap technology NOW. Example: javascript. A language that IMO is worse than even php in a number of ways but still manages to attract developer mindshare. (Yes, I have some experience in classic Javascript / ECMAScript )

codexon 10y ago

Regarding bitcoin, the main problem is that a lot of people have large amounts of bitcoin horded from early days and they tend to be biased and start spamming forums about how great it is as it will make them very rich if the adoption increases. This is despite there being very major flaws with the system. As someone that has actually tried to sell things with bitcoin, there are major flaws with it, and they will never be fixed because these problems are inherent to blockchains. And people trying to get rich quick keep spamming forums and HN with blockchain technology X Y Z without acknowledging these problems. 1. It is really annoying to buy. You need to go out of your way to link your bank account and passport/driver's license at any major exchange, and this takes days or even weeks. You cannot buy it instantly with a credit card or paypal unless you find a shady seller with bad rates. No one wants to sell bitcoin for something that could be chargebacked. 2. No chargebacks. Good for sellers but not for buyers. People might be able to live with this if it weren't for the other 2 major problems. 3. Payment takes forever. Waiting for the recommended amount of confirms will take at least an hour? These problems are deal-breaking and can never be fixed when using blockchain technology.

wc23 10y ago
The term confirmation is a bad one. It gives people the impression that they have to wait 10 might.s to an hour to know if they have their money. The moment you see a transaction in you wallet, you have it, you just have to wait 10 mins to an hour to spend it. So to compare this to legacy systems which take 3-5 days and claim its too slow seems unfair.
- NeutronBoy 10y ago
  > you have it, you just have to wait 10 mins to an hour to spend it And then after 10 mins to an hour you find you can't spend it because it's been marked invalid, and the guy you sold your iPhone to is long gone.
- codexon 10y ago
  What neutron boy said. If you don't wait 5-6 confirmations, it could be a fake transaction. And I can spend money I get from Paypal as soon as I get it. I don't have to wait 1 hour.

patio11 10y ago

Well since you asked. Blockchain is the world's worst database, created entirely to maintain the reputations of venture capital firms who injected hundreds of millions of dollars into a technology whose core defining insight was "You can improve on a Ponzi scam by making it self-organizing and distributed; that gets vastly more distribution, reduces the single point of failure, and makes it censorship-resistant." That's more robust than I usually phrase things on HN, but you did ask. In slightly more detail: Databases are wonderful things. We have a number which are actually employed in production, at a variety of institutions. They run the world. Meaningful applications run on top of Postgres, MySQL, Oracle, etc etc. No meaningful applications run on top of "blockchain", because it is a marketing term. You cannot install blockchain just like you cannot install database. (Database sounds much cooler without the definitive article, too.) If you pick a particular instantiation of a blockchain-style database, it is a horrible, horrible database. Can I pick on Bitcoin? Let me pick on Bitcoin. Bitcoin is claimed to be a global financial network and ready for production right now. Bitcoin cannot sustain 5 transactions per second, worldwide. You might be sensibly interested in Bitcoin governance if, for some reason, you wanted to use Bitcoin. Bitcoin is a software artifact; it matters to users who makes changes to it and by what process. (Bitcoin is a software artifact, not a protocol, even though the Bitcoin community will tell you differently. There is a single C++ codebase which matters. It is essentially impossible to interoperate with Bitcoin without bugs-and-all replicating that codebase.) Bitcoin governance is captured by approximately ~5 people. This is a robust claim and requires extraordinary evidence. Ordinary evidence would be pointing you, in a handwavy fashion, about the depth of acrimony with regards to raising the block size, which would let Bitcoin scale to the commanding heights of 10 or, nay, 100 transactions per second worldwide. Extraordinary evidence might be pointing you to the time where the entire Bitcoin network was de-facto shut down based on the consensus of N people in an IRC channel. c.f. https://news.ycombinator.com/item?id=9320989 https://news.ycombinator.com/item?id=9320989 This was back in 2013. Long story short: a software update went awry so they rolled back global state by a few hours by getting the right two people to agree to it on a Skype call. But let's get back to discussing that sole technical artifact. Bitcoin has a higher cost-to-value ratio than almost any technology conceivable; the cost to date is the market capitalization of Bitcoin. Because Bitcoin enters through a seigniorage mechanism, every Bitcoin existing was minted as compensation for "security the integrity of the blockchain" (by doing computationally expensive makework). This cost is high. Today, routine maintenance of the Bitcoin network will cost the network approximately $1.5 million. That's on the order of $3 per write on a maximum committed capacity basis. It will cost another $1.5 million tomorrow, exchange rate depending. (Bitcoin has successfully shifted much of the cost of operating its database to speculators rather than people who actually use Bitcoin for transaction processing. That game of musical chairs has gone on for a while.) Bitcoin has some properties which one does not associate with many databases. One is that write acknowledgments average 5 minutes. Another is that they can stop, non-deterministically, for more than an hour at a time, worldwide, for all users simultaneously. This behavior is by design. I can go on, and probably will some other day. This is a bit of a hobby for me.

niftich 10y ago

Bitcoin's primary innovation isn't the blockchain per se, but the combination of the blockchain and proof-of-work timestamping to solve the double-spending problem without requiring a central authority. A "private" blockchain largely defeats the point, as you don't need trustless distributed concensus when you implictly trust yourself or a central authority. We just call these versioned databases.

fauria 10y ago

As I see it, Blockchain technology is based on some premises that are not easily achievable. This are the two I find most relevant: 1. A large user base (computational power) is needed to successfully run a blockchain backed product. If the network is small, a malicious attacker with enough resources could manipulate past transactions or prevent new ones (51% attack). 2. Blockchain was designed to be a trustless (no central authority) distributed ledger. In the case of Bitcoin, it prevents double spending of a virtual currency that only exists in the Internet. When applied to "real world" assets, sooner or later you will find a step in the process that involves trusting something or someone. So far I haven't been able to identify a use case for anything but a digital asset with great traction.

wmf 10y ago
Bankchains solve #1 by not using mining; they use something like BFT (which is basically Paxos for liars) so that only 51% of the companies in the consortium need to be honest at any one time.
- fauria 10y ago
  I guess that invalidates by definition #2.
  - wmf 10y ago
    Ah, I forgot to mention that. Bitcoin is totally trustless, while bankchains require the participants to trust each other's identities but not their behavior. Whether this trust model is applicable in any real-world situation is debatable. And yes, if you're using blockchain to track something like gold in a vault you might as well just have a database that is run by the same entity that runs the vault.

vectorpush 10y ago

Blockchain evangelists promise the world and deliver nothing except hype and political grandstanding in return. When we discuss the cryptocurrency concept, specifically bitcoin, I think reasonable people can agree that blockchain technology has yielded something unique, interesting and worthy of technical merit, despite it not living up to the insane prognostications of bitcoin fanatics . On the whole, I think it's fair to call bitcoin a success because it continues to exist and has been self sustaining more or less within the parameters of the original design for quite a few years. Although it is small, there is some real commerce that occurs in the bitcoin world, and even among some of the alt-coins that followed it. A self-sustaining mini-economy based on computer code is fascinating, and without all the breathless evangelists talking about how bitcoin will end all wars and liberate the masses from the tyranny of taxation and government, I think we'd see a lot more meaningful technical discussion of bitcoin and the other potential uses for blockchain technology. But that is not the world we live in. We live in a world where every conceivable problem is met with an overwrought and unworkable blockchain solution. We live in a world where startups can drain 100 million dollars on a clearly stupid idea because "blockchains are the future", we live in a world where bitcoin evangelists refuse to face the reality that the incumbent financial system is not at all threatened by bitcoin and concepts like "smart contracts" and that people with common sense aren't ignorant or misunderstanding blockchains just because they're trying to tell you that throwing millions of dollars into a "decentralized autonomous organization" (a misnomer which exemplifies blockchain insanity) is a dangerous and terrible idea. Blockchain enthusiasts need to put up or shut up. Storing land deeds and stocks on the blockchain is unworkable. Using the blockchain to power smart-locks and self-driving cars and autonomous drones and autonmous AI VCs is unworkable and unnecessary. Bitcoin, bitcoin copycats, and RNG roulette are the only examples of blockchains working mostly as intended and providing at least a marginal utility (in that cryptocurrency can be converted into spendable money). All the rest of it is demonstrably pointless (see literally every project created with etherum besides decentralized gambling software). This is leaving aside all the political nonsense and all the bitcoin hesits, thefts, scams, and buzzword swindling. The bottom line is that people are tired of hearing about the amazing capabilities of blockchains when nobody can seem to actually demonstrate their utility (besides bitcoin) in practice.

chx 10y ago

Blockchain technology? Maybe there's something in the future but right now Bitcoin is mostly used as an illegal vehicle to get money out of China. Some 90% of bitcoin trades originate in China. A lot of people who are peddling Bitcoin are holding on to it and try to convince others to use it so their holdings grow. The whole thing became a scam. The other "alt coins" are even worse, Monero is pushed by drug dealers etc.

deleted 10y ago

[deleted]

bryceweiner 10y ago

These comments are beyond simplistic and illustrate only a basic understanding of Bitcoin and less about how it works. A distributed ledger is a decentralized data store in which the data contained therein is cryptographically validated as true and correct (read: unaltered) as the protocols for communicating that data are Byzantine Fault Tolerant (BFT). A blockchain is a distributed ledger where the transactions are committed to the ledger in batches. That's it. It's that simple. In the financial realm this is beyond valuable in that FI's no longer need trust their employees, not their customers. The means by which the data is secured precludes the need for complex security systems at the network level, reducing entry and operating costs to that of simple disk space. These systems have existed for literally decades but they have languished in obscurity until Bitcoin demonstrated exactly how powerful such systems could be. Edit to add: The benefits become much clearer and simpler to understand once you spit out the Bitcoin koolade.

zackmiller84 10y ago

Reading through the responses from here has made me question my investment in Bitcoin, ShadowCash and Lisk.