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A blockchain ensures that some sequence of agreements was made in a way that everyone can trust. If everyone keeps their secret keys secure and solely in their

A blockchain ensures that some sequence of agreements was made in a way that everyone can trust. If everyone keeps their secret keys secure and solely in their possession, then no activity can be forged on the network by any significant likelihood. Anywhere this concept has value, a blockchain has value. That's all there is to it. The rest is fairy dust and noise. I don't really follow a lot of the discussion in this article. As I see it, most of the buzz around blockchains is just wild speculation and fantasy. For example, why would be want a "fat" protocol? In any other context in technology, "fat" anything is considered bad. Technologies are supposed to be "thin", simple, efficient, and composable. So why would the opposite be praised in this case? Furthermore, the characterization of existing foundational internet protocols as "thin" and blockchain protocols as "fat" seems like an inversion of truths. By my understanding, it would take as long or much longer to become well versed in all the nitty-gritty details of TCP/IP, DNS, etc. than it would to gain a solid understanding of Ethereum. Also, where is the need for software ecosystem micro-economies? None of this makes any logical sense to me. It seems people have gotten it in their heads that the simple technological innovations of hash trees and distributed consensus protocols are going to somehow make them rich. And they're finding weird ways of justifying this.

meri_dian 9y ago
Well said. Wealth is built through control, while a distributed ledger rejects control by design. Now distributed ledgers have utility, but that does not necessarily mean they will create business value for entrepreneurs and investors. It's almost like how regulation has value in society, but regulation is decidedly not profitable and businesses usually reject it.
- platz 9y ago
  > distributed ledger rejects control by design Assuming you convince 1) 100,000 miners your blockchain has value, such that 2) the distribution of control is spread out among those miners uniformly. Both of which is a pretty big assumptions.
  - Semaphor 9y ago
    More and more newer projects don't need those miners. It's still in question if they really offer the same security, but between masternode chains (security by having the "mining" done by people having to hold a large share of the coins so tanking its value would hit them hardest), dPoS (delegated Proof of Stake, every coin is a vote and you vote for a pool of "miners"), DAG where everyone has to do PoW for other txs to confirm their own, and other ideas, there are some interesting things. (I say "miner" but for those newer ones, the proof of work is often minimal to non-existent.)
    - platz 9y ago
      If you can boil that down into an understandable statement appropriate for airing to on the radio or a finance television show, i'd be interested. Otherwise, it seems like you just tried to do a "grapeshot" with tech jargon & lacking a main point.
      - Semaphor 9y ago
        There are alternatives to requiring a massive amount of miners. Some alternative cryptocurrencies implement those alternatives. Happy? ;)
        platz 9y ago
        I imagine that exactly wouldn't be very convincing to those audiences now, would it?
        Semaphor 9y ago
        I can either give you entry points for what to search for or I can give you the gist of it. If you want neither maybe you should ignore my comment instead.
        platz 9y ago
        My point is that your point in it's current from is essentially un-communicable, to non-advanced technical users.
- em3rgent0rdr 9y ago
  > "Wealth is built through control" Centralised wealth is built through centralized control. Distributed wealth is built through distributed control.
  - 0wing 9y ago
    Distributed how? Produced how? by work? Bitcoin distributed the vast majority of its wealth to aprox less than ~1000 individuals. Best estimates are that there are about one million holders of Bitcoin; 47 individuals hold about 30 percent, another 900 hold a further 20 percent, the next 10,000 about 25% and another million about 20%, with 5% being lost. So 1/10th of one percent represent about half the holdings of Bitcoin and 1 percent close to 80 percent (http://www.businessinsider.com/927-people-own-half- of-the-bitcoins-2013-12). The concentration of Litecoin ownership is similar (http://litecoin-rich-list.blogspot.com). Most of the big wallets have been in place from early on, so sitting back and watching your capital grow has been a very successful strategy. The distribution of Bitcoin holdings looks much like the distribution of wealth in North Korea and makes the China’s and even the US’ wealth distribution look like that of a workers’ paradise https://bitcoin.stackexchange.com/questions/86/is-it-possible-to-estimate-the-gini-coefficient-for-bitcoins-and-if-the-trend-is https://bitcoin.stackexchange.com/questions/86/is-it-possibl... http://www.businessinsider.com/bitcoin-inequality-2014-1 http://www.businessinsider.com/bitcoin-inequality-2014-1 More to the point, assuming a currency medium has a finite supply - once produced and distributed, all future generations are at a catastrophic disadvantage simply for arriving at the wrong time. It should also be noted the term deflationary is often used to represent Bitcoin or other cryptocurrencies when in fact the supply continually inflates every 10 minutes. What many advocates conveniently omit from disclosing is the algorithm produced the supply very rapidly for very low effort to the early adopters. Not only does the production supply require more work for later adopters, but more users compete for the limited block rewards which decrease as time goes on. It's not exactly Ponzi scheme, or a Pyramid scheme. It's a Satoshi Scheme ... or a "Nakamoto Scheme" https://prestonbyrne.com/2017/12/08/bitcoin_ponzi/ https://prestonbyrne.com/2017/12/08/bitcoin_ponzi/
    - CryptoPunk 9y ago
fragsworth 9y ago
It seems like in most cases, the tokens are being used as a way for the developers to get funding to implement their project without the bureaucracy and costs of doing a real IPO. That would be fine on its own, but they're almost all pretending this is not the reason for it, and that the token is necessary. This is an obvious lie in nearly every case when you dig into the details. Nearly every dapp that has its own token can be cloned to use Ether without any detriment to the product.
- deleted 9y ago
  [deleted]
- sova 9y ago
  Absolutely right, the tokens are just a stepping stone to getting the [distributed] app off the ground. It's a great model! If you believe in the utility of something you can fund it very early on and reap great rewards, or at least root great endeavors on.
  - Karrot_Kream 9y ago
    How so? Can't you just do the same thing staking Ether instead of yet another ERC20 token?
    - colecut 9y ago
      Yes agreed, in several cases this summer I thought I was doing well with ICOs until I did the math and realized I would have done at least as well by just holding the ETH.
      - kukabynd 9y ago
        And this here is why we’re in a bubble.
        colecut 9y ago
        I don't really follow your logic, considering I was referring to over 6 months ago. But I do agree we're in a bubble.
msla 9y ago
> In any other context in technology, "fat" anything is considered bad. Technologies are supposed to be "thin", simple, efficient, and composable. I'd rather use a fat client than a thin one: Thin client: Primarily just a display. No local processing, or effectively none. Controlled from outside. Fat client: A processor with a display attached. Nontrivial local processing. Controlled by me. Maybe fat clients are inefficient. Maybe I'm not thinking right. I still want control.
Terr_ 9y ago
> A blockchain ensures that some sequence of agreements was made in a way that everyone can trust. [...] The rest is fairy dust and noise. Amen. "Blockchain" is today's fad just like the "nanotech" mania of yesteryear. That doesn't mean there aren't advances and opportunities, but it feels like 90% of the people promoting it can't even give a high-level explanation of why it's a good fit for their use-case. > For example, why would be want a "fat" protocol? This may seem weird, but bear with me: I think this is like people talking about intellectual property (copyrights, patents, franchises, etc.) The underlying idea is that you can create some core framework which everyone wants to use (or can't avoid) and that therefore you can collect rent (or at least sew up an incredible starter bonus) making it more consequential than the individual pieces. The current internet is (perhaps thankfully) a contrast, where nobody (AFAK) is making big bucks off of TCP-IP/HTML/Browser licensing fees.
- ThomPete 9y ago
  They actually can and fairly well IMO. What seems to be a bigger problem is that people don't want to accept that that has value.
- Spooky23 9y ago
  A friend of mine told a great story about how some Koop aid drinkers were pitching blockchain internally for internal chargeback for services. So you’d use your corpcoin to rent cubes and get pens from the facilities folks, and trade coin to get servers, etc. the idea had traction until the accountants revolted.
  - krrrh 9y ago
    Didn’t Ronald Coase win the Nobel prize in economics for basically pointing out why this was a bad idea? [1] [1] https://en.m.wikipedia.org/wiki/Coase_theorem https://en.m.wikipedia.org/wiki/Coase_theorem
  - Terr_ 9y ago
    Oof. It's hard to know where to even start poking holes in that. Like whether everybody's OK storing the data all across the world, versus running a tiny internal network that can be taken over by a disgruntled employee.
coffeemug 9y ago
> A blockchain ensures that some sequence of agreements was made in a way that everyone can trust. If everyone keeps their secret keys secure and solely in their possession, then no activity can be forged on the network by any significant likelihood. Anywhere this concept has value, a blockchain has value. That's all there is to it. Note an important caveat -- a centralized third party can also provide such a service. So you have to further subdivide the space into use cases where the blockchain has to compete against such services, and use cases where a public ledger is desirable in and of itself.
Alex3917 9y ago
> Anywhere this concept has value, a blockchain has value. Sure, and that's several trillion dollars per year worth of the global GDP.
contingencies 9y ago
Upgrade cost of network complexity: The Internet has smart edges ... and a simple core. Adding an new Internet service is just a matter of distributing an application ... Compare this to voice, where one has to upgrade the entire core. - RFC3439 (2002) From http://github.com/globalcitizen/taoup http://github.com/globalcitizen/taoup
gjvc 9y ago
"Technologies are supposed to be "thin", simple, efficient, and composable." -- good aphorism for evaluating protocol schemas and suchlike.
cocktailpeanuts 9y ago
The "fat protocol" meme you're talking about has already come and gone. It was only a valid hypothesis when there's only a single dominant chain. Not anymore. It's becoming more apparent that there will be multiple chains, which means these chains compete for usage, so naturally "all the value aggregate to fat protocols" is not valid anymore. So you're right, the "fat protocol" should not be the norm. And it's really cool to see the landscape progress in this direction even though just last summer everyone took for granted that "fat protocol" will be the norm. p.s. There are so many "startup people" who are too lazy to delve deep into how the tech actually works, who just read some medium blog posts and watch some youtube videos and think they know everything. These people end up producing shallow content that's basically a parroting of what they read online. To people who actually have touched the code and building on these technologies, these things are so obviously outdated.
deepGem 9y ago
It would take as long or much longer to become well versed in all the nitty-gritty details of TCP/IP, DNS, etc. than it would to gain a solid understanding of Ethereum. I have to agree to this as I have written software to implement at least one networking protocol. On the contrary, I still haven't been able to wrap my head around Ethereum. I'm sure most of us know that TCP/IP and all the other networking protocols are thin by design, for good reasons. Speed and reliability. It seems strange to write a connection-oriented protocol (TCP) that runs on a connection less protocol (IP) but this design is efficient and serves the purpose. Calling the current bloating in blockchain protocols as a dramatic paradigm shift is an exaggeration. From what I see, the current blockchains protocols are bloated (as compared to TCP/IP) because they are encapsulating the application logic within themselves so as to achieve decentralization in a highly secure manner. (Based on my frugal understanding). It's a new way of doing things, perhaps not necessarily a paradigm shift. Note to self - Understand blockchain in depth, may be it is a paradigm shift.

meri_dian 9y ago

Well said. Wealth is built through control, while a distributed ledger rejects control by design. Now distributed ledgers have utility, but that does not necessarily mean they will create business value for entrepreneurs and investors. It's almost like how regulation has value in society, but regulation is decidedly not profitable and businesses usually reject it.

platz 9y ago
> distributed ledger rejects control by design Assuming you convince 1) 100,000 miners your blockchain has value, such that 2) the distribution of control is spread out among those miners uniformly. Both of which is a pretty big assumptions.
- Semaphor 9y ago
  More and more newer projects don't need those miners. It's still in question if they really offer the same security, but between masternode chains (security by having the "mining" done by people having to hold a large share of the coins so tanking its value would hit them hardest), dPoS (delegated Proof of Stake, every coin is a vote and you vote for a pool of "miners"), DAG where everyone has to do PoW for other txs to confirm their own, and other ideas, there are some interesting things. (I say "miner" but for those newer ones, the proof of work is often minimal to non-existent.)
  - platz 9y ago
    If you can boil that down into an understandable statement appropriate for airing to on the radio or a finance television show, i'd be interested. Otherwise, it seems like you just tried to do a "grapeshot" with tech jargon & lacking a main point.
    - Semaphor 9y ago
      There are alternatives to requiring a massive amount of miners. Some alternative cryptocurrencies implement those alternatives. Happy? ;)
      - platz 9y ago
        I imagine that exactly wouldn't be very convincing to those audiences now, would it?
        Semaphor 9y ago
        I can either give you entry points for what to search for or I can give you the gist of it. If you want neither maybe you should ignore my comment instead.
        platz 9y ago
        My point is that your point in it's current from is essentially un-communicable, to non-advanced technical users.
em3rgent0rdr 9y ago
> "Wealth is built through control" Centralised wealth is built through centralized control. Distributed wealth is built through distributed control.
- 0wing 9y ago
  Distributed how? Produced how? by work? Bitcoin distributed the vast majority of its wealth to aprox less than ~1000 individuals. Best estimates are that there are about one million holders of Bitcoin; 47 individuals hold about 30 percent, another 900 hold a further 20 percent, the next 10,000 about 25% and another million about 20%, with 5% being lost. So 1/10th of one percent represent about half the holdings of Bitcoin and 1 percent close to 80 percent (http://www.businessinsider.com/927-people-own-half- of-the-bitcoins-2013-12). The concentration of Litecoin ownership is similar (http://litecoin-rich-list.blogspot.com). Most of the big wallets have been in place from early on, so sitting back and watching your capital grow has been a very successful strategy. The distribution of Bitcoin holdings looks much like the distribution of wealth in North Korea and makes the China’s and even the US’ wealth distribution look like that of a workers’ paradise https://bitcoin.stackexchange.com/questions/86/is-it-possible-to-estimate-the-gini-coefficient-for-bitcoins-and-if-the-trend-is https://bitcoin.stackexchange.com/questions/86/is-it-possibl... http://www.businessinsider.com/bitcoin-inequality-2014-1 http://www.businessinsider.com/bitcoin-inequality-2014-1 More to the point, assuming a currency medium has a finite supply - once produced and distributed, all future generations are at a catastrophic disadvantage simply for arriving at the wrong time. It should also be noted the term deflationary is often used to represent Bitcoin or other cryptocurrencies when in fact the supply continually inflates every 10 minutes. What many advocates conveniently omit from disclosing is the algorithm produced the supply very rapidly for very low effort to the early adopters. Not only does the production supply require more work for later adopters, but more users compete for the limited block rewards which decrease as time goes on. It's not exactly Ponzi scheme, or a Pyramid scheme. It's a Satoshi Scheme ... or a "Nakamoto Scheme" https://prestonbyrne.com/2017/12/08/bitcoin_ponzi/ https://prestonbyrne.com/2017/12/08/bitcoin_ponzi/
  - CryptoPunk 9y ago

fragsworth 9y ago

It seems like in most cases, the tokens are being used as a way for the developers to get funding to implement their project without the bureaucracy and costs of doing a real IPO. That would be fine on its own, but they're almost all pretending this is not the reason for it, and that the token is necessary. This is an obvious lie in nearly every case when you dig into the details. Nearly every dapp that has its own token can be cloned to use Ether without any detriment to the product.

deleted 9y ago
[deleted]
sova 9y ago
Absolutely right, the tokens are just a stepping stone to getting the [distributed] app off the ground. It's a great model! If you believe in the utility of something you can fund it very early on and reap great rewards, or at least root great endeavors on.
- Karrot_Kream 9y ago
  How so? Can't you just do the same thing staking Ether instead of yet another ERC20 token?
  - colecut 9y ago
    Yes agreed, in several cases this summer I thought I was doing well with ICOs until I did the math and realized I would have done at least as well by just holding the ETH.
    - kukabynd 9y ago
      And this here is why we’re in a bubble.
      - colecut 9y ago
        I don't really follow your logic, considering I was referring to over 6 months ago. But I do agree we're in a bubble.

msla 9y ago

> In any other context in technology, "fat" anything is considered bad. Technologies are supposed to be "thin", simple, efficient, and composable. I'd rather use a fat client than a thin one: Thin client: Primarily just a display. No local processing, or effectively none. Controlled from outside. Fat client: A processor with a display attached. Nontrivial local processing. Controlled by me. Maybe fat clients are inefficient. Maybe I'm not thinking right. I still want control.

Terr_ 9y ago

> A blockchain ensures that some sequence of agreements was made in a way that everyone can trust. [...] The rest is fairy dust and noise. Amen. "Blockchain" is today's fad just like the "nanotech" mania of yesteryear. That doesn't mean there aren't advances and opportunities, but it feels like 90% of the people promoting it can't even give a high-level explanation of why it's a good fit for their use-case. > For example, why would be want a "fat" protocol? This may seem weird, but bear with me: I think this is like people talking about intellectual property (copyrights, patents, franchises, etc.) The underlying idea is that you can create some core framework which everyone wants to use (or can't avoid) and that therefore you can collect rent (or at least sew up an incredible starter bonus) making it more consequential than the individual pieces. The current internet is (perhaps thankfully) a contrast, where nobody (AFAK) is making big bucks off of TCP-IP/HTML/Browser licensing fees.

ThomPete 9y ago
They actually can and fairly well IMO. What seems to be a bigger problem is that people don't want to accept that that has value.
Spooky23 9y ago
A friend of mine told a great story about how some Koop aid drinkers were pitching blockchain internally for internal chargeback for services. So you’d use your corpcoin to rent cubes and get pens from the facilities folks, and trade coin to get servers, etc. the idea had traction until the accountants revolted.
- krrrh 9y ago
  Didn’t Ronald Coase win the Nobel prize in economics for basically pointing out why this was a bad idea? [1] [1] https://en.m.wikipedia.org/wiki/Coase_theorem https://en.m.wikipedia.org/wiki/Coase_theorem
- Terr_ 9y ago
  Oof. It's hard to know where to even start poking holes in that. Like whether everybody's OK storing the data all across the world, versus running a tiny internal network that can be taken over by a disgruntled employee.

coffeemug 9y ago

> A blockchain ensures that some sequence of agreements was made in a way that everyone can trust. If everyone keeps their secret keys secure and solely in their possession, then no activity can be forged on the network by any significant likelihood. Anywhere this concept has value, a blockchain has value. That's all there is to it. Note an important caveat -- a centralized third party can also provide such a service. So you have to further subdivide the space into use cases where the blockchain has to compete against such services, and use cases where a public ledger is desirable in and of itself.

Alex3917 9y ago

> Anywhere this concept has value, a blockchain has value. Sure, and that's several trillion dollars per year worth of the global GDP.

contingencies 9y ago

Upgrade cost of network complexity: The Internet has smart edges ... and a simple core. Adding an new Internet service is just a matter of distributing an application ... Compare this to voice, where one has to upgrade the entire core. - RFC3439 (2002) From http://github.com/globalcitizen/taoup http://github.com/globalcitizen/taoup

gjvc 9y ago

"Technologies are supposed to be "thin", simple, efficient, and composable." -- good aphorism for evaluating protocol schemas and suchlike.

cocktailpeanuts 9y ago

The "fat protocol" meme you're talking about has already come and gone. It was only a valid hypothesis when there's only a single dominant chain. Not anymore. It's becoming more apparent that there will be multiple chains, which means these chains compete for usage, so naturally "all the value aggregate to fat protocols" is not valid anymore. So you're right, the "fat protocol" should not be the norm. And it's really cool to see the landscape progress in this direction even though just last summer everyone took for granted that "fat protocol" will be the norm. p.s. There are so many "startup people" who are too lazy to delve deep into how the tech actually works, who just read some medium blog posts and watch some youtube videos and think they know everything. These people end up producing shallow content that's basically a parroting of what they read online. To people who actually have touched the code and building on these technologies, these things are so obviously outdated.

deepGem 9y ago

It would take as long or much longer to become well versed in all the nitty-gritty details of TCP/IP, DNS, etc. than it would to gain a solid understanding of Ethereum. I have to agree to this as I have written software to implement at least one networking protocol. On the contrary, I still haven't been able to wrap my head around Ethereum. I'm sure most of us know that TCP/IP and all the other networking protocols are thin by design, for good reasons. Speed and reliability. It seems strange to write a connection-oriented protocol (TCP) that runs on a connection less protocol (IP) but this design is efficient and serves the purpose. Calling the current bloating in blockchain protocols as a dramatic paradigm shift is an exaggeration. From what I see, the current blockchains protocols are bloated (as compared to TCP/IP) because they are encapsulating the application logic within themselves so as to achieve decentralization in a highly secure manner. (Based on my frugal understanding). It's a new way of doing things, perhaps not necessarily a paradigm shift. Note to self - Understand blockchain in depth, may be it is a paradigm shift.