6 ms·

Happy to answer any follow-up questions here

elmar 9y ago
Great article! Bringing financial inclusion to the billions of unbaked it's the biggest unfulfilled promise of cryptocurrencies. For it to work it must be engineered on the protocol level for this use case, I think Cardano is trying to solve this problem. The store of value and savings part it's more or less easy to solve, the big problem is the lending without a stable coin it will be very difficult to implement, big Fiat currencies like the Dollar and the Euro have the powerful backing of a central bank and ultimately the collateralization of all the taxpayers as a protection against high volatility and black swan events, this will be very difficult to implement in crypto, MakerDAO is tring to do it but I don't see it working on a big scale.
ilaksh 9y ago
It's not quite a complete discussion without mentioning the transaction rate/scaling limitations and also Ethereum's sharding approach to this.
- rrecuero 9y ago
  I tried to mention that scalability is a moving target. As you mentioned Plasma, Raiden and sharding are different approaches to solve it
  - freejulian 9y ago
    Raiden is a poor and incomplete implementation of Lightning. Bitcoin has 3 independent implementations and a developing ecosystem of software around it. Proof of stake is a pipe dream. Such a system can’t reliably achieve consensus due to the nothing-at-stake problem. Additionally, randomly selecting a winner in a distributed yet unpredictable way continues to be an unsolved problem. Sharding has the cost of weakening security. Bitcoin is addressing scaling better than any other blockchain. It’s making transactions more efficient through technologies like Segwit and Schnorr. It’s adding robust smart contracts and instant payments using second layer sidechains like rootstock and lightning. Ethereum is already imploding under its own weight — it’s impossible to even sync a full node on basic hardware. In a few years it’ll be dead.
    - CryptoPunk 9y ago
      >>Raiden is a poor and incomplete implementation of Lightning. Raiden is a comprehensive implementation that includes Lightning Networks for ERC20 tokens, something that Bitcoin doesn't even have. >>Proof of stake is a pipe dream. Your information is incorrect. Ethereum's proof of stake is close to complete conceptually and the first version, a hybrid PoW/PoS protocol called Casper the Friendly Finality Gadget, is currently under development and will be implemented in Ethereum soon. >>Such a system can’t reliably achieve consensus due to the nothing-at-stake problem. Your criticism is long out of date. Vitalik Buterin addressed how the Nothing at Stake problem can be solved in 2014: https://blog.ethereum.org/2014/11/25/proof-stake-learned-love-weak-subjectivity/ https://blog.ethereum.org/2014/11/25/proof-stake-learned-lov... >>Bitcoin is addressing scaling better than any other blockchain. It’s making transactions more efficient through technologies like Segwit and Schnorr. It’s adding robust smart contracts and instant payments using second layer sidechains like rootstock and lightning. Bitcoin's lack of Turing Completeness at the base layer is a critical weakness that limits the range of second layer solutions that are possible. Ethereum has far more sophisticated and numerous scaling solutions in development as a result. >>Sharding has the cost of weakening security. That is not certain to be true. There are a lot security impacting variables at play that sharding affects, and some of them positively. Even if security were reduced, it wouldn't mean the trade off for more scalability wouldn't be worth it. Sharding enables massive scaling while preserving the ability for consumer grade nodes to contribute to validation. That seems like a good trade off. >>Ethereum is already imploding under its own weight — it’s impossible to even sync a full node on basic hardware. That is highly misleading. SSDs have been syncing fine. HDDs have been having syncing problems, but that was solved in the most recent Geth release. >>In a few years it’ll be dead. Disingenuous FUD. Ethereum is the primary Dapp platform, with 30X more developers working on it than the next most active platform. It has a multipronged scaling strategy that is in an advanced state of development and dwarfs that of any other blockchain. It is now the most widely used blockchain in the world, processing 3X more transactions per day than #2 Bitcoin. And in all of these categories, its momentum is growing.
      - freejulian 9y ago
        > Raiden is a comprehensive implementation Is the lone implementation which is still on testnet and no ecosystem surrounding it. > ERC20 tokens, something that Bitcoin doesn't even have. Bitcoin has no interest in implementing an equivalent as a layer-1 feature. This should be a surprise to no one. Off-chain scaling is the official direction of the Bitcoin community. There's no interest in adding bloat to the layer 1 protocol. Ethereum is the "everything including the kitchen sink" approach. Anyways, saying Bitcoin does'nt have ERC20 is factually incorrect: Rootstock implements ERC20 tokens as a second layer network. > Your information is incorrect. Ethereum's proof of stake is close to complete conceptually and the first version It's not any where near complete, which is why the difficulty bomb was rolled back (which in and of itself is hilarious -- Ethereum only pretends to be decentralized). > Vitalik Buterin addressed how the Nothing at Stake problem can be solved in 2014 He described how to solve it 4 years ago, yet they still can't release even a hybrid PoS solution. Slasher does not solve the nothing at stake problem, it merely obfuscates it. Long range attacks are still possible. I noticed you completely glossed over how PoS systems will agree on randomness. Good luck. I'm sure it's just another 4 years away. > Bitcoin's lack of Turing Completeness at the base layer is a critical weakness that limits the range of second layer solutions that are possible. Lack of Turing Completeness is a feature and intentional. If you want a general purpose distributed computer use rootstock. Which, by the way, is 100% compatible with the Eth VM. > Sharding enables massive scaling while preserving the ability for consumer grade nodes to contribute to validation. That's cute. Ethereum doesn't even have any "consumer grade" nodes today. Anyways, sounds like you're taking the long way around to agreeing with me: Sharding sacrifices security. > That is highly misleading. SSDs have been syncing fine. HDDs have been having syncing problems, Again, taking the long way around to agreeing with me. A full archive node currently requires a 400GB SSD! You're only option is to run a light node, which further contributes to your networks centralization. > Disingenuous FUD. Eh, you'll see. The monolithic approach of Ethereum is very naive. > with 30X more developers working on it than the next most active platform Easily proved false, anyone reading can take a look at the respective github repos. Bitcoin currently has over 550 contributors, Ethereum only has 200. Bitcoin has over 16k commits. Ethereum has only 9k. This doesn't even take into account the larger ecosystem of software Bitcoin has. > Ethereum is the primary Dapp platform, A little early to make any of these claims...the only popular Dapp in recent memory is cryptokitties and it brought the Ethereum network to its knees. Anyways, like I've said, Bitcoin has a fully compatible Ethereum VM running as a layer 2 network. > It has a multipronged scaling strategy that is in an advanced state of development I wouldn't call it multipronged -- Vitalik has it all hinging on PoS and that has been officially delayed until late 2018 at best. > dwarfs that of any other blockchain. Well, until you look at actual commit and contributor count. Then it's clear Bitcoin has far more development happening. > It is now the most widely used blockchain in the world, processing 3X more transactions per day than #2 Bitcoin I mean, bitcoin is operating at capacity. I'm sure Ethereum has more spam transactions though, I agree. Saying Ethereum is the most widely used blockchain in the world his hilarious. People know Bitcoin. A small fraction of those people know Ethereum. > And in all of these categories, its momentum is growing. As its network continues to crumble. Best of luck. We'll reconvene when Casper finally launches...hopefully while we're still young.
- elmar 9y ago
  sharding is in the same boat as proof-of-stake, nobody knows if a system can be built that preserves the level of security of current monolithic and proof-of-work systems, it is being studied on an academic an implementation level by several teams including Cardano, ethereum and ethereum classic. On the scalability issue if you sacrifice the decentralization is theoretically possible for Bitcoin to process on-chain, Visa level of transactions and with current energy consumption levels or even less. You would probably get 3 to 6 physical data center locations probably on the same continent connected with high-speed links with 1 Terabyte 10min blocks.
  - rrdharan 9y ago
    Proof of steak sounds delicious and would be enough to tempt me off the sidelines into investing.
    - elmar 9y ago
      >Proof of steak sounds delicious and would be enough to tempt me off the sidelines into investing. LOL Proof of steak https://youtu.be/U3OEk2dNYcU?t=44 https://youtu.be/U3OEk2dNYcU?t=44
cvaidya1986 9y ago
Are ICOs illegal in the USA?
- rrecuero 9y ago
  It is illegal to sell securities to non-accredited investors
  - cvaidya1986 9y ago
    Do tokens fall under that category ?
    - aboodman 9y ago
      It depends on how they are used, but frequently, yes. Even so, you can sell to accredited investors totally legally. A few ICOs have worked this way.
      - cvaidya1986 9y ago
        Is a cryptokitty illegal for non accredited investors to buy? Or is it just a “normal” good.
        zeperoni 9y ago
        Cryotpkitty is under the current existing Ethereum network. Like how you can still buy bitcoin. ICO are initial coin offerings, so it's an investment before the actual coin is released and on the market.
        whb07 9y ago
        No it’s just as trivial as a Pokémon card
    - whb07 9y ago
      I just recently saw the SEC secretary say that ico’s are not illegal if they were to be done roughly behind closed doors, so to speak. Meaning, don’t spam to the world your ico address and be diligent as to who you’re talking to about potential investments. The SEC secretary wants a fine line distinction between a “private” and “public” raising of money. He’s right to point that all icos (besides filecoin) are trying to be considered as “private” while publicly share their address and don’t discern who sends in funds. Here’s a recent SEC release: https://www.sec.gov/news/public-statement/statement-clayton-2017-12-11 https://www.sec.gov/news/public-statement/statement-clayton-...
gervase 9y ago
I am really looking forward to "The Future of Organizations". I think decentralized governance and consensus is one of the most exciting aspects of these technologies, but are being totally drowned out by the fintech applications in the meantime. Hopefully this article will address some of these possibilities.
- rrecuero 9y ago
  It will. One of the great companies in the space will write it. I also recommend this article from Fred Ehrsam https://medium.com/@FEhrsam/blockchain-governance-programming-our-future-c3bfe30f2d74 https://medium.com/@FEhrsam/blockchain-governance-programmin...
mlinksva 9y ago
> It’s not a coincidence that the whitepaper was published after the 2008 subprime mortgage crisis. Is there any evidence for this? Perhaps a statement from Satoshi that they were motivated to publish by the crisis?
- rrecuero 9y ago
  In the Genesis Block he explicitly references the post financial crisis bailouts.
  - sk221 9y ago
    Yep. He noted a headline in that day's paper "The Times 03/Jan/2009 Chancellor on brink of second bailout for banks" Source: https://en.bitcoin.it/wiki/Genesis_block https://en.bitcoin.it/wiki/Genesis_block (or you can verify on the blockchain as well)
tramGG 9y ago
Have you looked into things like Synapse.ai ? They are building exactly what you're talking about in terms of data/AI/ML/currency/ownership. Here is their founder giving a presentation about it at the Decentralized AI Summit: https://www.youtube.com/watch?v=9QMgVsbHu98 https://www.youtube.com/watch?v=9QMgVsbHu98 It ties together things like the "Who owns the future" book by Jaron Lanier and AI/Bots/APIs for new economies.
- rrecuero 9y ago
  Thanks for sharing. Reminds me a bit of Numerai
  - tramGG 9y ago
    Yeah numerai is great, they were one of the first ones in the financial/trading space.
v64 9y ago
Thanks for this writeup! You've done a great job at organizing many of the points that were discussed in this Bitcoin thread[1] from last month. I'll be using this as a starting point for discussion with friends that are interested in cryptocurrency. [1] https://news.ycombinator.com/item?id=16158463 https://news.ycombinator.com/item?id=16158463
- rrecuero 9y ago
  Thank you. That was the intention, to provide a primer for discussion.

Great article! Bringing financial inclusion to the billions of unbaked it's the biggest unfulfilled promise of cryptocurrencies. For it to work it must be engineered on the protocol level for this use case, I think Cardano is trying to solve this problem. The store of value and savings part it's more or less easy to solve, the big problem is the lending without a stable coin it will be very difficult to implement, big Fiat currencies like the Dollar and the Euro have the powerful backing of a central bank and ultimately the collateralization of all the taxpayers as a protection against high volatility and black swan events, this will be very difficult to implement in crypto, MakerDAO is tring to do it but I don't see it working on a big scale.

ilaksh 9y ago

It's not quite a complete discussion without mentioning the transaction rate/scaling limitations and also Ethereum's sharding approach to this.

rrecuero 9y ago
I tried to mention that scalability is a moving target. As you mentioned Plasma, Raiden and sharding are different approaches to solve it
- freejulian 9y ago
  Raiden is a poor and incomplete implementation of Lightning. Bitcoin has 3 independent implementations and a developing ecosystem of software around it. Proof of stake is a pipe dream. Such a system can’t reliably achieve consensus due to the nothing-at-stake problem. Additionally, randomly selecting a winner in a distributed yet unpredictable way continues to be an unsolved problem. Sharding has the cost of weakening security. Bitcoin is addressing scaling better than any other blockchain. It’s making transactions more efficient through technologies like Segwit and Schnorr. It’s adding robust smart contracts and instant payments using second layer sidechains like rootstock and lightning. Ethereum is already imploding under its own weight — it’s impossible to even sync a full node on basic hardware. In a few years it’ll be dead.
  - CryptoPunk 9y ago
    >>Raiden is a poor and incomplete implementation of Lightning. Raiden is a comprehensive implementation that includes Lightning Networks for ERC20 tokens, something that Bitcoin doesn't even have. >>Proof of stake is a pipe dream. Your information is incorrect. Ethereum's proof of stake is close to complete conceptually and the first version, a hybrid PoW/PoS protocol called Casper the Friendly Finality Gadget, is currently under development and will be implemented in Ethereum soon. >>Such a system can’t reliably achieve consensus due to the nothing-at-stake problem. Your criticism is long out of date. Vitalik Buterin addressed how the Nothing at Stake problem can be solved in 2014: https://blog.ethereum.org/2014/11/25/proof-stake-learned-love-weak-subjectivity/ https://blog.ethereum.org/2014/11/25/proof-stake-learned-lov... >>Bitcoin is addressing scaling better than any other blockchain. It’s making transactions more efficient through technologies like Segwit and Schnorr. It’s adding robust smart contracts and instant payments using second layer sidechains like rootstock and lightning. Bitcoin's lack of Turing Completeness at the base layer is a critical weakness that limits the range of second layer solutions that are possible. Ethereum has far more sophisticated and numerous scaling solutions in development as a result. >>Sharding has the cost of weakening security. That is not certain to be true. There are a lot security impacting variables at play that sharding affects, and some of them positively. Even if security were reduced, it wouldn't mean the trade off for more scalability wouldn't be worth it. Sharding enables massive scaling while preserving the ability for consumer grade nodes to contribute to validation. That seems like a good trade off. >>Ethereum is already imploding under its own weight — it’s impossible to even sync a full node on basic hardware. That is highly misleading. SSDs have been syncing fine. HDDs have been having syncing problems, but that was solved in the most recent Geth release. >>In a few years it’ll be dead. Disingenuous FUD. Ethereum is the primary Dapp platform, with 30X more developers working on it than the next most active platform. It has a multipronged scaling strategy that is in an advanced state of development and dwarfs that of any other blockchain. It is now the most widely used blockchain in the world, processing 3X more transactions per day than #2 Bitcoin. And in all of these categories, its momentum is growing.
    - freejulian 9y ago
      > Raiden is a comprehensive implementation Is the lone implementation which is still on testnet and no ecosystem surrounding it. > ERC20 tokens, something that Bitcoin doesn't even have. Bitcoin has no interest in implementing an equivalent as a layer-1 feature. This should be a surprise to no one. Off-chain scaling is the official direction of the Bitcoin community. There's no interest in adding bloat to the layer 1 protocol. Ethereum is the "everything including the kitchen sink" approach. Anyways, saying Bitcoin does'nt have ERC20 is factually incorrect: Rootstock implements ERC20 tokens as a second layer network. > Your information is incorrect. Ethereum's proof of stake is close to complete conceptually and the first version It's not any where near complete, which is why the difficulty bomb was rolled back (which in and of itself is hilarious -- Ethereum only pretends to be decentralized). > Vitalik Buterin addressed how the Nothing at Stake problem can be solved in 2014 He described how to solve it 4 years ago, yet they still can't release even a hybrid PoS solution. Slasher does not solve the nothing at stake problem, it merely obfuscates it. Long range attacks are still possible. I noticed you completely glossed over how PoS systems will agree on randomness. Good luck. I'm sure it's just another 4 years away. > Bitcoin's lack of Turing Completeness at the base layer is a critical weakness that limits the range of second layer solutions that are possible. Lack of Turing Completeness is a feature and intentional. If you want a general purpose distributed computer use rootstock. Which, by the way, is 100% compatible with the Eth VM. > Sharding enables massive scaling while preserving the ability for consumer grade nodes to contribute to validation. That's cute. Ethereum doesn't even have any "consumer grade" nodes today. Anyways, sounds like you're taking the long way around to agreeing with me: Sharding sacrifices security. > That is highly misleading. SSDs have been syncing fine. HDDs have been having syncing problems, Again, taking the long way around to agreeing with me. A full archive node currently requires a 400GB SSD! You're only option is to run a light node, which further contributes to your networks centralization. > Disingenuous FUD. Eh, you'll see. The monolithic approach of Ethereum is very naive. > with 30X more developers working on it than the next most active platform Easily proved false, anyone reading can take a look at the respective github repos. Bitcoin currently has over 550 contributors, Ethereum only has 200. Bitcoin has over 16k commits. Ethereum has only 9k. This doesn't even take into account the larger ecosystem of software Bitcoin has. > Ethereum is the primary Dapp platform, A little early to make any of these claims...the only popular Dapp in recent memory is cryptokitties and it brought the Ethereum network to its knees. Anyways, like I've said, Bitcoin has a fully compatible Ethereum VM running as a layer 2 network. > It has a multipronged scaling strategy that is in an advanced state of development I wouldn't call it multipronged -- Vitalik has it all hinging on PoS and that has been officially delayed until late 2018 at best. > dwarfs that of any other blockchain. Well, until you look at actual commit and contributor count. Then it's clear Bitcoin has far more development happening. > It is now the most widely used blockchain in the world, processing 3X more transactions per day than #2 Bitcoin I mean, bitcoin is operating at capacity. I'm sure Ethereum has more spam transactions though, I agree. Saying Ethereum is the most widely used blockchain in the world his hilarious. People know Bitcoin. A small fraction of those people know Ethereum. > And in all of these categories, its momentum is growing. As its network continues to crumble. Best of luck. We'll reconvene when Casper finally launches...hopefully while we're still young.
elmar 9y ago
sharding is in the same boat as proof-of-stake, nobody knows if a system can be built that preserves the level of security of current monolithic and proof-of-work systems, it is being studied on an academic an implementation level by several teams including Cardano, ethereum and ethereum classic. On the scalability issue if you sacrifice the decentralization is theoretically possible for Bitcoin to process on-chain, Visa level of transactions and with current energy consumption levels or even less. You would probably get 3 to 6 physical data center locations probably on the same continent connected with high-speed links with 1 Terabyte 10min blocks.
- rrdharan 9y ago
  Proof of steak sounds delicious and would be enough to tempt me off the sidelines into investing.
  - elmar 9y ago
    >Proof of steak sounds delicious and would be enough to tempt me off the sidelines into investing. LOL Proof of steak https://youtu.be/U3OEk2dNYcU?t=44 https://youtu.be/U3OEk2dNYcU?t=44

cvaidya1986 9y ago

Are ICOs illegal in the USA?

rrecuero 9y ago
It is illegal to sell securities to non-accredited investors
- cvaidya1986 9y ago
  Do tokens fall under that category ?
  - aboodman 9y ago
    It depends on how they are used, but frequently, yes. Even so, you can sell to accredited investors totally legally. A few ICOs have worked this way.
    - cvaidya1986 9y ago
      Is a cryptokitty illegal for non accredited investors to buy? Or is it just a “normal” good.
      - zeperoni 9y ago
        Cryotpkitty is under the current existing Ethereum network. Like how you can still buy bitcoin. ICO are initial coin offerings, so it's an investment before the actual coin is released and on the market.
      - whb07 9y ago
        No it’s just as trivial as a Pokémon card
  - whb07 9y ago
    I just recently saw the SEC secretary say that ico’s are not illegal if they were to be done roughly behind closed doors, so to speak. Meaning, don’t spam to the world your ico address and be diligent as to who you’re talking to about potential investments. The SEC secretary wants a fine line distinction between a “private” and “public” raising of money. He’s right to point that all icos (besides filecoin) are trying to be considered as “private” while publicly share their address and don’t discern who sends in funds. Here’s a recent SEC release: https://www.sec.gov/news/public-statement/statement-clayton-2017-12-11 https://www.sec.gov/news/public-statement/statement-clayton-...

gervase 9y ago

I am really looking forward to "The Future of Organizations". I think decentralized governance and consensus is one of the most exciting aspects of these technologies, but are being totally drowned out by the fintech applications in the meantime. Hopefully this article will address some of these possibilities.

rrecuero 9y ago
It will. One of the great companies in the space will write it. I also recommend this article from Fred Ehrsam https://medium.com/@FEhrsam/blockchain-governance-programming-our-future-c3bfe30f2d74 https://medium.com/@FEhrsam/blockchain-governance-programmin...

mlinksva 9y ago

> It’s not a coincidence that the whitepaper was published after the 2008 subprime mortgage crisis. Is there any evidence for this? Perhaps a statement from Satoshi that they were motivated to publish by the crisis?

rrecuero 9y ago
In the Genesis Block he explicitly references the post financial crisis bailouts.
- sk221 9y ago
  Yep. He noted a headline in that day's paper "The Times 03/Jan/2009 Chancellor on brink of second bailout for banks" Source: https://en.bitcoin.it/wiki/Genesis_block https://en.bitcoin.it/wiki/Genesis_block (or you can verify on the blockchain as well)

tramGG 9y ago

Have you looked into things like Synapse.ai ? They are building exactly what you're talking about in terms of data/AI/ML/currency/ownership. Here is their founder giving a presentation about it at the Decentralized AI Summit: https://www.youtube.com/watch?v=9QMgVsbHu98 https://www.youtube.com/watch?v=9QMgVsbHu98 It ties together things like the "Who owns the future" book by Jaron Lanier and AI/Bots/APIs for new economies.

rrecuero 9y ago
Thanks for sharing. Reminds me a bit of Numerai
- tramGG 9y ago
  Yeah numerai is great, they were one of the first ones in the financial/trading space.

v64 9y ago

Thanks for this writeup! You've done a great job at organizing many of the points that were discussed in this Bitcoin thread[1] from last month. I'll be using this as a starting point for discussion with friends that are interested in cryptocurrency. [1] https://news.ycombinator.com/item?id=16158463 https://news.ycombinator.com/item?id=16158463

rrecuero 9y ago
Thank you. That was the intention, to provide a primer for discussion.