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People who didn't understand the internet invested in the .com bubble. Compared to crypto/blockchain, the internet is a relatively straightforward thing to und

by JPKab 9y ago

People who didn't understand the internet invested in the .com bubble. Compared to crypto/blockchain, the internet is a relatively straightforward thing to understand. My suspicion is that, because a much higher percentage of the population isn't going to be able to make sense of blockchain, it will be easier for the finance industry and startups to trick idiots into investing, and they will have a deeper pool of idiots to draw from. Just like the .com bubble, there is real value in blockchain. You just can't judge that from the investments.

spookthesunset 9y ago
> there is real value in blockchain People say this, but I maintain it isn't true. The only thing the blockchain is good for is when you cannot have any kind of central trusted authority. "Central authority" typically meaning government institutions like regulations and the legal system. Once you remove a central trusted authority, transaction costs get very expensive very fast. If you can't trust anybody but yourself it means you bear the cost of validating every single part of a transaction. You see this in the blockchain--it is massively more expensive to process a transaction than using a simple database. You see this in "smart contracts" because without a legal system to fallback on, you have to code every single edge case no matter how remote or you'll get fucked (which is actually impossible anyway, and is one of the reasons why the entire idea of "smart contracts" is a bunch of baloney...). My point is, for 99.9% of every day things we have no need for any kind of distributed trustless ledger. The transaction costs for them outweigh the alternative of simply trusting people and using our legal system when something goes bad. The only real use case for trustless distributed ledgers are for stuff that cannot use the legal system--eg organized crime, crypto-ransomware software, illegal drug trade, etc. For everything else, a database is all you need. By the way, I'm not even going to go into the fact that "The Blockchain" only functions with mining, and the only way to incentivize mining is to bolt a "currency" on top like Bitcoin or ETH and then find a market to sell all the "coins" the miners generate. Take away that, and who the hell pays for the mining? If your answer is "the banks would" or "the parties would"... well, if they are gonna do that why the hell wouldn't they just pay for a traditional database instead? After all, that kind of cooperation sounds pretty centralized anyway and a large Postgres instance is a lot cheaper than thousands and thousands of miners....
- sizzle 9y ago
  Great post. I share the same sentiment.
- INTPenis 9y ago
  >By the way, I'm not even going to go into the fact that "The Blockchain" only functions with mining I'm not very informed but I was under the impression that the blockchain is just a technology that happens to be used for cryptocurrencies. When used for currencies it requires "mining". But if one were to use the technology for tracking shipping containers or mail then what sort of mining would need to be done?
  - spookthesunset 9y ago
    Take away the mining and all you've got is basically a less capable version of Git - which is somewhat the same data structure (a merkle tree) So to answer your question indirectly, unless you like using inappropriate, inefficient data structures--if you are gonna be tracking shipping containers or the mail.... a good old fashioned database is what you need.

by JPKab 9y ago

spookthesunset 9y ago

> there is real value in blockchain People say this, but I maintain it isn't true. The only thing the blockchain is good for is when you cannot have any kind of central trusted authority. "Central authority" typically meaning government institutions like regulations and the legal system. Once you remove a central trusted authority, transaction costs get very expensive very fast. If you can't trust anybody but yourself it means you bear the cost of validating every single part of a transaction. You see this in the blockchain--it is massively more expensive to process a transaction than using a simple database. You see this in "smart contracts" because without a legal system to fallback on, you have to code every single edge case no matter how remote or you'll get fucked (which is actually impossible anyway, and is one of the reasons why the entire idea of "smart contracts" is a bunch of baloney...). My point is, for 99.9% of every day things we have no need for any kind of distributed trustless ledger. The transaction costs for them outweigh the alternative of simply trusting people and using our legal system when something goes bad. The only real use case for trustless distributed ledgers are for stuff that cannot use the legal system--eg organized crime, crypto-ransomware software, illegal drug trade, etc. For everything else, a database is all you need. By the way, I'm not even going to go into the fact that "The Blockchain" only functions with mining, and the only way to incentivize mining is to bolt a "currency" on top like Bitcoin or ETH and then find a market to sell all the "coins" the miners generate. Take away that, and who the hell pays for the mining? If your answer is "the banks would" or "the parties would"... well, if they are gonna do that why the hell wouldn't they just pay for a traditional database instead? After all, that kind of cooperation sounds pretty centralized anyway and a large Postgres instance is a lot cheaper than thousands and thousands of miners....

sizzle 9y ago
Great post. I share the same sentiment.
INTPenis 9y ago
>By the way, I'm not even going to go into the fact that "The Blockchain" only functions with mining I'm not very informed but I was under the impression that the blockchain is just a technology that happens to be used for cryptocurrencies. When used for currencies it requires "mining". But if one were to use the technology for tracking shipping containers or mail then what sort of mining would need to be done?
- spookthesunset 9y ago
  Take away the mining and all you've got is basically a less capable version of Git - which is somewhat the same data structure (a merkle tree) So to answer your question indirectly, unless you like using inappropriate, inefficient data structures--if you are gonna be tracking shipping containers or the mail.... a good old fashioned database is what you need.