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The Blockchain Is Bigger Than Any Bubble
- osrec 9y agoThe block chain is good in so far as it is useful. I'm seeing a whole bunch of people deploy it where anonymous trust is not a requirement. They're just needlessly increasing the costs of the networks they create. It's a bit of hype that will surely subside. Not saying it's not useful - just not for everything under the sun!
- drcode 9y agoYou make it sound like having an open system for timestamped records with support for highly complex permissions validation with a deep audit trail that is resistant to fraud and posthoc record tampering has no utility beyond buying drugs....
- aaron-lebo 9y agoThey criticized blockchain, but still said it was useful. They didn't act like it had no utility, that's a strawman. When I see IBM advertising blockchain in the middle of football games to an audience who has no fucking clue what that means, or how little it is used in production, I know it's hype. The blockchain is a useful protocol, but what you are describing doesn't even require it, just a few trusted sources, which blockchains have to fall back to, anyway, with trusted oracles. Their larger point might be that as much a blockchain advocates love it, there's not a single mainstream application outside of Bitcoin 8 years later. Someone yesterday compared it to the hype behind torrents changing everything, though torrents might be more practically useful.
- maxfurman 9y agoTorrents are used by Blizzard, among others, to distribute updates for their games
- JackFr 9y agoYou can buy drugs with git?
- JorgeGT 9y agoGiven the complexity of git commands, I cannot rule it out.
- empath75 9y agoIndirectly. You get paid for committing code, after all.
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- lloyd-christmas 9y agogit pull pull pass
- pdpi 9y agoWe've had all of that for aeons. The only really novel thing Bitcoin brought to the table was the consensus algorithm (which is in no way, shape, or form a complaint — it's precisely what it should be) — but that consensus algorithm only works for currencies (for a sufficiently loose definition of currency that allows for the current fees and delays). Nakamoto consensus solves the double-spend problem, but only if mining blocks gives you a reward that's denominated in the same currency as the transactions you're mining.
- DennisP 9y agoEthereum uses essentially the same consensus algorithm for lots of things besides currencies.
- pdpi 9y agoMy definition of "doesn't work" here is: the security guarantees that the consensus protocol provides stop applying. Just because nobody has found it worthwhile to attack Ethereum "not a currency" stuff yet doesn't mean that it's safe.
- DennisP 9y agoEthereum's consensus model makes the same security guarantees for contract operation that it does for the built-in currency; given the value of Ethereum-based tokens there's a very large bounty for anyone able to poke a hole in that. Of course this is only a guarantee that contracts will run as written, not that they're written correctly. There's a lot of research on applying high-assurance techniques to contract development but it'll be a while before that stuff is ready for production.
- drcode 9y agoOP talked about "Blockchain" not bitcoin specifically (which has more limited use cases, but that's not relevant to this thread)
- ska 9y ago
- osrec 9y agoI don't think I made it sound that way, but if I did, it was in error. I understand the implications of the technology, but my issue is with firms applying it to literally everything, even when it's not cogent to do so.
- UncleMeat 9y agoJust use git then? A number of auditable ledgers exist w/o decentralization.
- southpawflo 9y agowith today's privacy and security concerns, for any new project, would starting from a position of anonymous trust despite the increased resource requirements really be a downside? I ask as an outsider to the industry. I do understand that blockchain tech doesn't need to be slapped onto everything, but from my perspective it seems the benefits generally outweigh the detriments - at least so far
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- betterunix2 9y agoThe resource requirements are a massive downside, but they are only necessary for the "permissionless" model. In almost all cases it is equally good to use a permissioned model where the parties are all identified in advance, which completely avoids the need for proof of work (because there are no sybil attacks when everyone has a known and fixed identity).
- marsrover 9y ago> Blockchain technology might also be used one day to produce new kinds of central-bank money. I feel like they missed the whole point.
- XR0CSWV3h3kZWg 9y agoMaybe they mean money no singular entity controls that still can enact sane monetary policy? There basically aren't any cryptocurrencies that are useful for writing long term (i.e. terms greater than 1 hour) contracts (here meaning do this action -> get this payout). The value fluctuates too much. Having a stable value is not necessary for transmitting value, or even as a store of value as long as the long term trend is not down. Determining how much someone should be paid in the future in it is awful though.
- osrec 9y agoSort of, however it can bring full transactional traceability in a very transparent, open manner. That's better than what we have today. I mean, at a basic level even extracting your own account data from a bank is extremely tedious if you stay within their terms of use (i.e don't use yodlee etc)!
- pythonaut_16 9y agoIsn't most money used as purely digital anyway? When you get a mortgage, it's not like $300k of physical money changes hands. So at a basic level quite a few (most) transactions are happening on a digital, abstract level anyway, so really the question is can blockchain be used to improve this model, and is there sufficient incentive for existing players to do so, or is there enough opportunity for someone else to come in and do so. I think the former is what we're seeing banks start to explore today, while BTC and other cryptocoins have been exploring the latter.
- osrec 9y agoYes transactions are digital, but they are neither open nor transparent. The information itself is heavily guarded, as it essentially ring fences the competitive advantage of banks and stops plucky start ups coming in, adding value and thereby reducing the perceived value/utility of a traditional bank.
- thisisit 9y ago> stabilized by central banks acting as trusted monopoly producers Oh the number of cryptocurrencies which have tried to stabilize their currency. There was BitsharesX which was abandoned quickly. Then there is USDT. The answer is there can never be a "trusted monopoly producers" in a decentralised world.
- 1053r 9y agoTo be fair, while Bitshares was a pretty complete failure, BitUSD, which sits on top of it as a "stablecoin" should be regarded as a complete success. Look at the price chart relative to dollars. [1] It only has brief and small excursions away from $1 despite being thinly traded and having very low market cap, and being backed by having a nearly worthless coin, as cryptocurrencies go. Stablecoins are a very interesting concept. They are a game-theoretically incentive compatible way to stabilize a currency WITHOUT a trusted monopoly producer. [2] 1 - https://coinmarketcap.com/currencies/bitusd/ https://coinmarketcap.com/currencies/bitusd/ 2 - https://blog.ethereum.org/2014/11/11/search-stable-cryptocurrency/ https://blog.ethereum.org/2014/11/11/search-stable-cryptocur...
- thisisit 9y agoThe smallest measure in forex is called a pip. For USD it is $0.0001. Movement of price from $1 to say $0.98 is a movement of ~200 pips. This is considered huge volatility in forex. So it might look small excursions it is not a good result when compared to real world use. and I am saying this as someone who invested in Bitshares and it's precursor Protoshares. I still hold ~100k of BTSX. > They are a game-theoretically incentive compatible way to stabilize a currency WITHOUT a trusted monopoly producer. This is the biggest fallacy in cryptocurrency scene. People think everything can be mathematically modeled. Absolutely not. Everyone will act rationally in a given situation. Absolutely not. If that were the case we would solved all the problems in the world using some kind of game theory function. Edit: Oops looks like I deleted the SNB example. Here's what happened: https://www.reuters.com/article/us-swiss-snb/swiss-draw-line-in-the-sand-to-cap-runaway-franc-idUSTRE7851LV20110906 https://www.reuters.com/article/us-swiss-snb/swiss-draw-line... SNB drew and held a line at 1.20 for EUR/CHF pair. No cryptocurrency can repeat that feat.
- ThomPete 9y agoPeople keep comparing Bitcoin to a currency like the Dollar which leads to a lot of problematic comparisons. Think about it as gold and it starts to make sense in the long term (short term is anyone's guess)
- soared 9y agoPeople keep comparing one currency to another currency? Preposterous! If you have something that is similar to the dollar it will and should be compared to the dollar. All those problems are real.
- ThomPete 9y agoNot really. It's long since anyone saw bitcoin as a viable currency. It's a store of value like gold that's about it.
- goldcountry 9y agoI stopped reading when the author claimed that bitcoin not having "alternative uses, like gold" makes it less suitable as a currency
- and0 9y agoWhat are Bitcoin's alternative uses?
- TheCapn 9y agoI think OP's point is that "not having alternative uses" shouldn't be a negative characteristic? To play Devil's Advocate, is Gold's current value where it is today because it is useful in jewelry and electronics? Why does Bitcoin necessarily need something to provide its value besides the value we give it?
- zerostar07 9y agoat 144GB it's definitely very big
- misterHN 9y agoI don't think the CIA wants to let bloomberg get away with using bitcoin to terrorize Americans. If bloomberg is trying to play Wizard of Oz with bitcoin...the Americans will cheer when bloomberg buildings become targets of terror. Bloomberg: Bitcoin is big and scary! Watch out! Too big to fail! Americans: CIA, please deal with this problem CIA: KGB, uh, going to need a little help here KGB: no problem ::kaboom:: Americans: THANK YOU CIA, THANK YOU KGB, BURN IN HELL BLOOMBERG
- olalonde 9y ago> Bitcoin is a poor currency and a crazy investment -- but the technology behind it is a real breakthrough. I feel like that should be the other way around. When all the "blockchain startups" and ICOs blow up, Bitcoin will be left standing. The true innovation behind the "blockchain" was its decentralised consensus mechanism. That mechanism is only secure as long as no single entity controls over 50% of the hash rate. Some of the largest Bitcoin miners have so much hash rate today that they could attack any (SHA-256 based) blockchain but the Bitcoin one. "The Internet is a poor network and a crazy investment -- but TCP/IP is a real breakthrough."... Sure!
- rdslw 9y agothe problem many praising blockchain minus bitcoin people forget, is that blockchain strength (distributed reconciliation) is possible only because of incentive (sth you get in exchange for doing all the etahashes per second). The moment you take incentive (bitcoin) out of the equation, whole blockchain will lose its strenght. You can not take out greed^H^H^Hincentive out of the picture. p.s. this is black and white written in bitcoin whitepaper.
- nettdata 9y agoThen how do you explain the Maersk blockchain-based insurance trial that they found very successful? Bitcoin is not the only incentive that can be had in implementing blockchain technology. There are a number of very promising use cases for blockchain, in education, healthcare, energy... none of which involve bitcoin at all.
- kirykl 9y agoHype, Consultants, Buzzwords baffling executives
- ambicapter 9y agoWere any of these trials interesting enough to be attacked?
- 9y ago
- geraldbauer 9y agoFYI: If you are interested in building your own blockchains from scratch over at the Awesome Blockchains page (and repo) [1] I collect starter samples (e.g. in 20 lines of javascript, python, ruby, ...) and articles. Happy Blockchaining. [1] https://github.com/openblockchains/awesome-blockchains https://github.com/openblockchains/awesome-blockchains
- zby 9y agoThat might very well be true - as blockchain these days can mean just about anything related to cryptography.
- greenwireless 9y agoHow many times can a bubble burst? once ... So far the bitcoin bubble has "burst" several times, maybe we can call it something other than a bubble?
- sxtn 9y agoa zit?
- lukasb 9y agoWHICH blockchain, though?
- SimbaOnSteroids 9y agoI don't understand how bitcoin is different from a fiat currency. Both only has value because we say it has value. Obviously a fiat currency generally has the backing of a central government. However a government is only viable as long as the constituents tolerate it, meaning whatever currency it issues, backed by the credit of such government, again only has value because people say it does.
- jstanley 9y agoYou can't transfer fiat currency to an anonymous person on the other side of the world without asking for permission and without trusting a third party. That's how bitcoin is different to fiat.
- milcron 9y agoBitcoin has a hard cap of 21 million BTC. Fiat can be printed.
- SimbaOnSteroids 9y agoBitcoin's hard cap can be lifted should the right consortium of people decide to.
- jstanley 9y agoIf by "consortium of people" you mean "overwhelming consensus among bitcoin users", then sure.
- droopyEyelids 9y agoFiat currency is controlled centrally, bitcoin is decentralized. A central bank can print more money at its whim. Bitcoin follows a set of rules that can't change. Make of it what you will, but it's a fundamentally different approach
- wickedlogic 9y agoBitcoins value does have an upper limit, to the extent it is cheaper/advantageous to move to a nearly identical clone, because the mainline is over-valued enough that the idea entices critical mass (of new people) to shift. This normalizes over time/culture, today we fork for technical reasons, but in the future there will be other reasons.