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Okay, I don't want to come down too hard on this article, but I think it's nearsighted. Sure, it's true that _today's_ blockchains have many downsides the artic

by dack 9y ago

Okay, I don't want to come down too hard on this article, but I think it's nearsighted. Sure, it's true that _today's_ blockchains have many downsides the article brings up, but it's written as if those won't change or improve. It feels to me a bit like claiming in the 90's that the internet isn't the future because you can't download that much stuff at 56k speeds. They mention "immutability" being a problem - so much so that it somehow disallows typos or undos. That's just not true - you just represent the updates as changes in their own right (which better reflects reality than literally altering history). There's nothing about "the blockchain" that can't record human error or corrections. They go on to talk about how proof of stake doesn't solve all problems by mentioning, "The Bitcoin blockchain is currently 157GB in size, and that’s at a very low transaction speed. The idea of everyone mining on their phone is just laughable." Once again, they are talking about current implementations - I don't see how this is inherently a restriction in the technology, and there are (reputable) companies working on this exact thing. The amount of money I have in cryptocurrencies can basically be rounded to zero, so I don't have much skin in this game - I just think blog posts like these aren't really making compelling points other than "the current technology today has many flaws", which I think is uninteresting to most.

bencollier49 9y ago
> It feels to me a bit like claiming in the 90's that the internet isn't the future because you can't download that much stuff at 56k speeds. Absolutely this. As soon as I read the article I was reminded of those 1996 "this internet stuff is a fad" pieces.
chris_wot 9y ago
Well, he has a point. Unless you use a cryptocurrency, I can't think of anything that needs the blockchain. I have seen plenty of people trying to shoehorn the blockchain into areas that don't need it - goods distribution, electricity supply, you name it and someone is trying to do it. Almost all of those things would actually work better with a centralised database. The Blockchain is an awesome technology for an incredibly niche market. So his article is right - in most cases, you probably don't need a blockchain.
- dack 9y ago
  agreed! I don't think there's any particular application outside cryptocurrency that I would strongly defend as "needing" a blockchain - then again, I'm not the most imaginative person, so I think others will eventually come up with some genuinely unique and valuable uses!
  - dlubarov 9y ago
    It's not really "needing", but one of the strong use cases is disrupting escrow. If domains, car/house titles, etc. existed as blockchain objects then they could be sold securely with no escrow.
    - nosuchthing 9y ago
      so you can lose the deed to your house because it gets hacked..?
      - dlubarov 9y ago
        Physical deeds are forged all the time, and sorting it out requires a quiet title lawsuit. A stolen electronic deed would be handled similarly. You would ask a court to declare the stolen title invalid and issue a new one.
        voiper1 9y ago
        so if the court is doing that, then we have a centralized power... the opposite of the idea of blockchain.
        dlubarov 9y ago
        Just to make sure it's clear, I'm not saying that courts should have any special power to manipulate the blockchain, just that they could declare a stolen title invalid, and issue a new one in the form of a new colored coin on the blockchain. I'm not claiming any benefit related to government control, just that escrow would be unnecessary.
eridius 9y ago
> It feels to me a bit like claiming in the 90's that the internet isn't the future because you can't download that much stuff at 56k speeds. The internet had tremendous utility at 56k speeds. The blockchain so far is mostly just useful for propagating itself and propping up the value of cryptocoins. There are some exceptions, such as using the blockchain to notarize documents (although has any court actually accepted blockchain-notarized documents as having legal power?), but the author's criticisms are well-founded. Even Ethereum Smart Contracts aren't particularly useful because in order to affect anything not on the blockchain you need an oracle, which destroys the whole decentralized 'trustless' concept. > They mention "immutability" being a problem - so much so that it somehow disallows typos or undos. That's just not true - you just represent the updates as changes in their own right The author already covered this. You can't undo a transaction without the cooperation of the other party. Accidentally send 10BTC to someone when you meant to send 1BTC? You're entirely beholden to the whims of the recipient to decide whether to refund you. Nobody else can do it. Or perhaps more importantly, if someone steals money from you, it's impossible to recover (because you can be sure the thief isn't going to refund it). If you're using the blockchain in a manner where you can trust the recipient to be on board with correcting any errors, what benefit are you getting from the blockchain? > I just think blog posts like these aren't really making compelling points other than "the current technology today has many flaws", which I think is uninteresting to most. The only two points tied to "current technology" in the article are complaints about the blockchain speed and the blockchain size. But it turns out the first problem is going to be solved by literally not using the blockchain for most stuff (which pretty much proves the article's point), and the second problem is still a legitimate problem. Even if you can mine without having the full blockchain, someone is going to need to have it in order to actually validate the whole thing periodically. If we get to the point where the blockchain is so large that only a few major players can afford to have the whole thing, then we've lost the 'trustless' aspect because now we have to trust those major players when they say the blockchain validates properly.
- chrisco255 9y ago
  This is no different than cash or physical property.
TheDong 9y ago
> It feels to me a bit like claiming in the 90's that the internet isn't the future because you can't download that much stuff at 56k speeds. You know what other things people said weren't the future? Tons and tons of things that failed. You have survivor bias; there are far more things people say will not be the future that then fails and everyone forgets about.
jchanimal 9y ago
A global distributed ledger is less cumbersome to develop and more efficient to run, when it uses a transactional NoSQL database, than a blockchain. In almost all use cases, there are existing identity, reputation, and legal frameworks that a distributed ledger can depend on. Here's an article I wrote about how most of the time you're better off with a database instead of a blockchain: https://blog.fauna.com/distributed-ledger-without-the-blockchain https://blog.fauna.com/distributed-ledger-without-the-blockc... There are some cases where existing identity and legal frameworks can't be used, where proof-of-work has some interest. My other problem with proof-of-work is that it can't scale because it always demands that blockchains use more energy than the economic value they are protecting. Here is an analysis of how blockchains aren't immutable: https://www.coindesk.com/blockchain-immutability-myth/ https://www.coindesk.com/blockchain-immutability-myth/
- dlubarov 9y ago
  I skimmed the immutability article. The argument is essentially that a country like China could wreak havoc on Bitcoin by acquiring 51% of mining power. His calculation is a bit outdated -- current mining revenue is over 7 billion [1] without even counting transaction fees -- but I guess the argument is still somewhat plausible. More importantly, the argument doesn't apply to proof-of-stake blockchains, which I believe are the future. Unless a government is able to purchase a 51% stake in the currency, but that would require hundreds of billions for a currency as large as Bitcoin. [1] https://www.google.com/search?q=12.50+%2F+%2810+minutes%29+*+%2411%2C036.50+in+%24%2Fyear https://www.google.com/search?q=12.50+%2F+%2810+minutes%29+*...
  - lalaland1125 9y ago
    Proof of stake has other flaws. One issue in particular is that forks are much, much cheaper in proof of stake. This means that you can achieve "51% attacks" with decent probability with a much smaller amount of mining ability.
    - dlubarov 9y ago
      I've been working on a blockchain design involving PoS, and it's certainly more difficult to get right, but it's a solvable problem. 51% attacks normally require 51% stake. It's true that large stakeholders will occasionally have several winning block scores in a row, which lets them create a viable short fork, but it's not really a problem. Short forks just mean that users need to wait for several blocks if they want a high degree of certainty that a transaction is final. 51% attacks could also be more feasible if an attacker can manipulate entropy, but the usual safeguard is to derive entropy from verifier addresses, as NXT does, so that manipulating entropy will cost a verifier their block reward. Then require verifiers to have a certain minimum account age, high enough that grinding attacks become infeasible. Certainly more complex, but with the right design PoS works fine while saving electricity, and the cost savings are passed on to all stakeholders.
ckastner 9y ago
> Okay, I don't want to come down too hard on this article, but I think it's nearsighted. Sure, it's true that _today's_ blockchains have many downsides the article brings up I read the article as a criticism of the status quo, in which case the prospect of future potential would be irrelevant.

by dack 9y ago

bencollier49 9y ago

> It feels to me a bit like claiming in the 90's that the internet isn't the future because you can't download that much stuff at 56k speeds. Absolutely this. As soon as I read the article I was reminded of those 1996 "this internet stuff is a fad" pieces.

chris_wot 9y ago

Well, he has a point. Unless you use a cryptocurrency, I can't think of anything that needs the blockchain. I have seen plenty of people trying to shoehorn the blockchain into areas that don't need it - goods distribution, electricity supply, you name it and someone is trying to do it. Almost all of those things would actually work better with a centralised database. The Blockchain is an awesome technology for an incredibly niche market. So his article is right - in most cases, you probably don't need a blockchain.

dack 9y ago
agreed! I don't think there's any particular application outside cryptocurrency that I would strongly defend as "needing" a blockchain - then again, I'm not the most imaginative person, so I think others will eventually come up with some genuinely unique and valuable uses!
- dlubarov 9y ago
  It's not really "needing", but one of the strong use cases is disrupting escrow. If domains, car/house titles, etc. existed as blockchain objects then they could be sold securely with no escrow.
  - nosuchthing 9y ago
    so you can lose the deed to your house because it gets hacked..?
    - dlubarov 9y ago
      Physical deeds are forged all the time, and sorting it out requires a quiet title lawsuit. A stolen electronic deed would be handled similarly. You would ask a court to declare the stolen title invalid and issue a new one.
      - voiper1 9y ago
        so if the court is doing that, then we have a centralized power... the opposite of the idea of blockchain.
        dlubarov 9y ago
        Just to make sure it's clear, I'm not saying that courts should have any special power to manipulate the blockchain, just that they could declare a stolen title invalid, and issue a new one in the form of a new colored coin on the blockchain. I'm not claiming any benefit related to government control, just that escrow would be unnecessary.

eridius 9y ago

> It feels to me a bit like claiming in the 90's that the internet isn't the future because you can't download that much stuff at 56k speeds. The internet had tremendous utility at 56k speeds. The blockchain so far is mostly just useful for propagating itself and propping up the value of cryptocoins. There are some exceptions, such as using the blockchain to notarize documents (although has any court actually accepted blockchain-notarized documents as having legal power?), but the author's criticisms are well-founded. Even Ethereum Smart Contracts aren't particularly useful because in order to affect anything not on the blockchain you need an oracle, which destroys the whole decentralized 'trustless' concept. > They mention "immutability" being a problem - so much so that it somehow disallows typos or undos. That's just not true - you just represent the updates as changes in their own right The author already covered this. You can't undo a transaction without the cooperation of the other party. Accidentally send 10BTC to someone when you meant to send 1BTC? You're entirely beholden to the whims of the recipient to decide whether to refund you. Nobody else can do it. Or perhaps more importantly, if someone steals money from you, it's impossible to recover (because you can be sure the thief isn't going to refund it). If you're using the blockchain in a manner where you can trust the recipient to be on board with correcting any errors, what benefit are you getting from the blockchain? > I just think blog posts like these aren't really making compelling points other than "the current technology today has many flaws", which I think is uninteresting to most. The only two points tied to "current technology" in the article are complaints about the blockchain speed and the blockchain size. But it turns out the first problem is going to be solved by literally not using the blockchain for most stuff (which pretty much proves the article's point), and the second problem is still a legitimate problem. Even if you can mine without having the full blockchain, someone is going to need to have it in order to actually validate the whole thing periodically. If we get to the point where the blockchain is so large that only a few major players can afford to have the whole thing, then we've lost the 'trustless' aspect because now we have to trust those major players when they say the blockchain validates properly.

chrisco255 9y ago
This is no different than cash or physical property.

TheDong 9y ago

> It feels to me a bit like claiming in the 90's that the internet isn't the future because you can't download that much stuff at 56k speeds. You know what other things people said weren't the future? Tons and tons of things that failed. You have survivor bias; there are far more things people say will not be the future that then fails and everyone forgets about.

jchanimal 9y ago

A global distributed ledger is less cumbersome to develop and more efficient to run, when it uses a transactional NoSQL database, than a blockchain. In almost all use cases, there are existing identity, reputation, and legal frameworks that a distributed ledger can depend on. Here's an article I wrote about how most of the time you're better off with a database instead of a blockchain: https://blog.fauna.com/distributed-ledger-without-the-blockchain https://blog.fauna.com/distributed-ledger-without-the-blockc... There are some cases where existing identity and legal frameworks can't be used, where proof-of-work has some interest. My other problem with proof-of-work is that it can't scale because it always demands that blockchains use more energy than the economic value they are protecting. Here is an analysis of how blockchains aren't immutable: https://www.coindesk.com/blockchain-immutability-myth/ https://www.coindesk.com/blockchain-immutability-myth/

dlubarov 9y ago
I skimmed the immutability article. The argument is essentially that a country like China could wreak havoc on Bitcoin by acquiring 51% of mining power. His calculation is a bit outdated -- current mining revenue is over 7 billion [1] without even counting transaction fees -- but I guess the argument is still somewhat plausible. More importantly, the argument doesn't apply to proof-of-stake blockchains, which I believe are the future. Unless a government is able to purchase a 51% stake in the currency, but that would require hundreds of billions for a currency as large as Bitcoin. [1] https://www.google.com/search?q=12.50+%2F+%2810+minutes%29+*+%2411%2C036.50+in+%24%2Fyear https://www.google.com/search?q=12.50+%2F+%2810+minutes%29+*...
- lalaland1125 9y ago
  Proof of stake has other flaws. One issue in particular is that forks are much, much cheaper in proof of stake. This means that you can achieve "51% attacks" with decent probability with a much smaller amount of mining ability.
  - dlubarov 9y ago
    I've been working on a blockchain design involving PoS, and it's certainly more difficult to get right, but it's a solvable problem. 51% attacks normally require 51% stake. It's true that large stakeholders will occasionally have several winning block scores in a row, which lets them create a viable short fork, but it's not really a problem. Short forks just mean that users need to wait for several blocks if they want a high degree of certainty that a transaction is final. 51% attacks could also be more feasible if an attacker can manipulate entropy, but the usual safeguard is to derive entropy from verifier addresses, as NXT does, so that manipulating entropy will cost a verifier their block reward. Then require verifiers to have a certain minimum account age, high enough that grinding attacks become infeasible. Certainly more complex, but with the right design PoS works fine while saving electricity, and the cost savings are passed on to all stakeholders.

ckastner 9y ago

> Okay, I don't want to come down too hard on this article, but I think it's nearsighted. Sure, it's true that _today's_ blockchains have many downsides the article brings up I read the article as a criticism of the status quo, in which case the prospect of future potential would be irrelevant.