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My question is if your conclusion is that blockchain is a solution in search of a problem, what was all that effort being spent on (not just in finance, but eve

My question is if your conclusion is that blockchain is a solution in search of a problem, what was all that effort being spent on (not just in finance, but everywhere blockchain is being considered)? I'm not saying that blockchain is not a valid solution to a problem, but as a veteran of the online industry, I can say I've seen a lot of hype around new technology, actual effort being put into it, and then the realization that the effort was for nothing. Either the solution is no better than the old solution, just different, or the solution is so obscure, that the cost of maintaining it is greater than the value it generates. In the end, the costs of the choices of these institutions are being paid for by you and I, and I hope they don't go too deep into their project before realizing: “Basically, it became a solution in search of a problem,”

jerf 9y ago
"My question is if this is your conclusion is that it's a solution in search of a problem, what was all that effort being spent on (not just in finance, but everywhere blockchain is being considered)?" That strikes me as a very rich question that would be interesting to investigate. Yes, we know people can get involved in hype cycles, but what was it about this technology that made it the thing that got hyped exactly? Perhaps a subconscious association with BitCoin and getting rich quick hit the people most prone to hype? Some of the blockchain projects being proposed, I honestly couldn't see how they were planning on profiting from it. I don't just mean profiting enough, but profiting at all; what was the mechanism by which money is transferred from some set of customers to the blockchain creators? Preferably with the transfer of some valuable good or service in the other direction, but, you know, technically that's optional from a business perspective. I understand the answer for new cryptocurrencies; the creators start with more of it than the incoming users and that becomes valuable as the currency becomes valuable. The non-currencies I didn't always see an answer. Which is why my best guess is some sort of subconscious belief that anything that has a blockchain will automatically somehow become wildly valuable via (underpants gnomes step 2 here). It's kinda a copout answer but it's the best I've got. Improvements? (Again, beyond just "people do hype." Why this hype and not something else?)
- Mtinie 9y ago
  I look at it differently: Brick-and-mortar plus mail-order was a viable business model for decades. Building the network infrastructure and software interconnections to move from that state to today’s online commerce and delivery model took years to accomplish and was (is) filled with hyped innovations. Blockchains may never reach their hyped potential, or we may simply be attempting to evaluate at very early stages vs. the point where utilities are clear.
  - mulmen 9y ago
    Do you look at every single new technology this way? If so how do you find time for anything else? If not what makes blockchain different?
    - Mtinie 9y ago
      I’m not sure I follow. I did not mean to imply I’m studiously watching every permutation of the blockchain hype cycle, simply, when it comes to new technologies which are billed as successors to long-lived incumbencies, I tend to take the middle ground. I try to keep a measured view of the optimisic hype and the pessimistic nay-saying, and don’t expect clarity for a few more years regarding blockchains’ potential. In general this philosophy towards technology has served me well enough. I miss out on the bleeding edge, but don’t fall into the trap of being “all in” before realizing a concept’s promise was oversold.
- dboreham 9y ago
  Asymmetry: it is very hard to irrefutably defeat someone proposing some highly amazing, low-probability-of-coming-to-pass future. The best you can do is say "hard to see how that happens, but who knows?..." Meanwhile the bullshitter is utterly convinced by their own koolaid. In the end it is a bug in the human brain firmware.
rambossa 9y ago
My major questions have always been: where is the business value in blockchain applications? what can a blockchain app do that can't be done by non-blockchain (beyond decentralization - bc I don't think this produces much business value)?
- onion-soup 9y ago
  Sending money without fees and delay? Have you ever tried a normal bank transfer? How long did it take? Have you ever tried, say, nano? It literally takes seconds and 0 fees. Here is some value.
  - boffinism 9y ago
    In the UK we can do that without the blockchain, in many situations, thanks to the real-time payment system [0]. So for me, a normal bank transfer is free and easy, whereas every time I've tried to do something involving blockchain it's meant delays, fees, and messing around on shady-looking websites. I take the point that in other places the norm is a lot worse and blockchain systems are producing better results, but it won't be long before banks get their act together and improve their services to match modern expectations (for fear of becoming obsolete), and then the blockchain competitive advantage is gone. [0] http://www.fasterpayments.org.uk/ http://www.fasterpayments.org.uk/
  - pxmpxm 9y ago
    The delay and cost is a function of mandatory compliance and recourse, rather than anything to do with technology.
    - SlowRobotAhead 9y ago
      I’m glad some people get it. Banks do zero delay and zero cost transactions between themselves already. The idea that “if only we coukd figure out where to use blockchain, everything would be FREE” is really naive. You take away a banks ability to charge for X, don’t be surprised when Y gets a new fee. As to decentralized, there seems to be a wonderful libritarian ideal around cryptocommodities but I’m reality they are much more centralized than anyone wants to admit. There are probably 10 people that if they wanted to could absolutely demolish bitcoin. Too much hype around all of this. Not even getting into the massive waste of power and potential.
scrooched_moose 9y ago
> what was all that effort being spent on Not being left behind if you're wrong. I'm in a tech-adjacent industry and see it all the time. Competitor A comes out with "shiny new technology" and markets the hell out of it. My company panics because we're suddenly lagging behind and rushes a competing project into development. Competitor B sees all of this and hops in too. All of a sudden it's the new direction of the industry and dominating trade shows, despite the origin being a mediocre product with some clever marketing. 5 years later it's never spoken of again. I'm not familiar enough to say for sure this is what happened with "blockchain", but from a distance it has a lot of familiar markers.
- johnchristopher 9y ago
  An example from the top of your head ?
  - scrooched_moose 9y ago
    GPU acceleration in scientific computing. My god in 2011 it was the only thing anyone talked about. Every COTS solver package cobbled together support in less than a year and were promising order of magnitude speedups. In 2018 it's still hanging around but realizing a 20% speedup on certain classes of problems. Maybe.
    - bushin 9y ago
      Amdahl's law strikes again.
    - saganus 9y ago
      Didn't that tech shifted to AI/ML? Isn't that considered scientific computing by some measure? I'm definitely not an expert so I'm maybe missing something here.
      - scrooched_moose 9y ago
        "Scientific Computing" was probably too general of a term to use. I focus more on FEA/CFD type problems where it's effectively been a bust. Most of our benchmarks show 8 cpu cores + 1 GPU is roughly equivalent to 10 cpu cores, and a second GPU has little additional benefit. I'm sure there are other disciplines that have seen a larger benefit.
amygdyl 9y ago
I flippantly thought, from the first time about when I was reading about dark pools in the financial times newspaper, the delay in reporting less interesting than I hadn't expected the reporting, I have felt as if the bankers were unravelling their own life support and ecosystem, without realising what they are doing. Dark pools existed for advancing business in a grey area of regulatory distinction. This is the habituated purpose of the modern banker. The most important exposition of the expansion of banks into grey area meaning uncertain legal ground in which crucially the advantage of any interpretation and codification by case law, is strongly to the advantage of who can deploy the greater resources, must be "Wriston" the biography of Walter Wriston, who created the modern Citibank from the National City Bank of New York. Precisely by expansion in grey areas of business. But the ad absurdam finality of creating ever more custom trading venues, is that you inevitably end up only being able to game yourself. The professional advantage of executing in a public market is replaced by the mind rotting process of writing your own rules and looking for where you can faithfully attest you weren't developing a rule for suitability for your trading desk abilities, you either accept you know that your own rules are already beaten by your own operations and become at best a pragmatist, of you devolve into second guessing the nature of your own company to be able to claim your rules are unbiased neutral and blind to be fair to all comers. This has turned banks into navel gazers not Watchmen over economic instability and guards of our capacity of production in daily life and ready in case of war. The regulation was wanted by banks to assure the public. This move to reliance on in house mechanisms for all of your flow, eliminate the advantage of regulation. This erodes the raisin detre of regulatory government but it far worse dissolves the conveyance of trust from government institution that the regulated bank enjoys. I am saying that one day I realised that the behaviour of banks had become self destructive and it wasn't a flu or affliction but a inherent character trait come out of much poorly understood history I think is too important to never let the public see. We need the institutions to function, too.

jerf 9y ago

"My question is if this is your conclusion is that it's a solution in search of a problem, what was all that effort being spent on (not just in finance, but everywhere blockchain is being considered)?" That strikes me as a very rich question that would be interesting to investigate. Yes, we know people can get involved in hype cycles, but what was it about this technology that made it the thing that got hyped exactly? Perhaps a subconscious association with BitCoin and getting rich quick hit the people most prone to hype? Some of the blockchain projects being proposed, I honestly couldn't see how they were planning on profiting from it. I don't just mean profiting enough, but profiting at all; what was the mechanism by which money is transferred from some set of customers to the blockchain creators? Preferably with the transfer of some valuable good or service in the other direction, but, you know, technically that's optional from a business perspective. I understand the answer for new cryptocurrencies; the creators start with more of it than the incoming users and that becomes valuable as the currency becomes valuable. The non-currencies I didn't always see an answer. Which is why my best guess is some sort of subconscious belief that anything that has a blockchain will automatically somehow become wildly valuable via (underpants gnomes step 2 here). It's kinda a copout answer but it's the best I've got. Improvements? (Again, beyond just "people do hype." Why this hype and not something else?)

Mtinie 9y ago
I look at it differently: Brick-and-mortar plus mail-order was a viable business model for decades. Building the network infrastructure and software interconnections to move from that state to today’s online commerce and delivery model took years to accomplish and was (is) filled with hyped innovations. Blockchains may never reach their hyped potential, or we may simply be attempting to evaluate at very early stages vs. the point where utilities are clear.
- mulmen 9y ago
  Do you look at every single new technology this way? If so how do you find time for anything else? If not what makes blockchain different?
  - Mtinie 9y ago
    I’m not sure I follow. I did not mean to imply I’m studiously watching every permutation of the blockchain hype cycle, simply, when it comes to new technologies which are billed as successors to long-lived incumbencies, I tend to take the middle ground. I try to keep a measured view of the optimisic hype and the pessimistic nay-saying, and don’t expect clarity for a few more years regarding blockchains’ potential. In general this philosophy towards technology has served me well enough. I miss out on the bleeding edge, but don’t fall into the trap of being “all in” before realizing a concept’s promise was oversold.
dboreham 9y ago
Asymmetry: it is very hard to irrefutably defeat someone proposing some highly amazing, low-probability-of-coming-to-pass future. The best you can do is say "hard to see how that happens, but who knows?..." Meanwhile the bullshitter is utterly convinced by their own koolaid. In the end it is a bug in the human brain firmware.

rambossa 9y ago

My major questions have always been: where is the business value in blockchain applications? what can a blockchain app do that can't be done by non-blockchain (beyond decentralization - bc I don't think this produces much business value)?

onion-soup 9y ago
Sending money without fees and delay? Have you ever tried a normal bank transfer? How long did it take? Have you ever tried, say, nano? It literally takes seconds and 0 fees. Here is some value.
- boffinism 9y ago
  In the UK we can do that without the blockchain, in many situations, thanks to the real-time payment system [0]. So for me, a normal bank transfer is free and easy, whereas every time I've tried to do something involving blockchain it's meant delays, fees, and messing around on shady-looking websites. I take the point that in other places the norm is a lot worse and blockchain systems are producing better results, but it won't be long before banks get their act together and improve their services to match modern expectations (for fear of becoming obsolete), and then the blockchain competitive advantage is gone. [0] http://www.fasterpayments.org.uk/ http://www.fasterpayments.org.uk/
- pxmpxm 9y ago
  The delay and cost is a function of mandatory compliance and recourse, rather than anything to do with technology.
  - SlowRobotAhead 9y ago
    I’m glad some people get it. Banks do zero delay and zero cost transactions between themselves already. The idea that “if only we coukd figure out where to use blockchain, everything would be FREE” is really naive. You take away a banks ability to charge for X, don’t be surprised when Y gets a new fee. As to decentralized, there seems to be a wonderful libritarian ideal around cryptocommodities but I’m reality they are much more centralized than anyone wants to admit. There are probably 10 people that if they wanted to could absolutely demolish bitcoin. Too much hype around all of this. Not even getting into the massive waste of power and potential.

scrooched_moose 9y ago

> what was all that effort being spent on Not being left behind if you're wrong. I'm in a tech-adjacent industry and see it all the time. Competitor A comes out with "shiny new technology" and markets the hell out of it. My company panics because we're suddenly lagging behind and rushes a competing project into development. Competitor B sees all of this and hops in too. All of a sudden it's the new direction of the industry and dominating trade shows, despite the origin being a mediocre product with some clever marketing. 5 years later it's never spoken of again. I'm not familiar enough to say for sure this is what happened with "blockchain", but from a distance it has a lot of familiar markers.

johnchristopher 9y ago
An example from the top of your head ?
- scrooched_moose 9y ago
  GPU acceleration in scientific computing. My god in 2011 it was the only thing anyone talked about. Every COTS solver package cobbled together support in less than a year and were promising order of magnitude speedups. In 2018 it's still hanging around but realizing a 20% speedup on certain classes of problems. Maybe.
  - bushin 9y ago
    Amdahl's law strikes again.
  - saganus 9y ago
    Didn't that tech shifted to AI/ML? Isn't that considered scientific computing by some measure? I'm definitely not an expert so I'm maybe missing something here.
    - scrooched_moose 9y ago
      "Scientific Computing" was probably too general of a term to use. I focus more on FEA/CFD type problems where it's effectively been a bust. Most of our benchmarks show 8 cpu cores + 1 GPU is roughly equivalent to 10 cpu cores, and a second GPU has little additional benefit. I'm sure there are other disciplines that have seen a larger benefit.

amygdyl 9y ago

I flippantly thought, from the first time about when I was reading about dark pools in the financial times newspaper, the delay in reporting less interesting than I hadn't expected the reporting, I have felt as if the bankers were unravelling their own life support and ecosystem, without realising what they are doing. Dark pools existed for advancing business in a grey area of regulatory distinction. This is the habituated purpose of the modern banker. The most important exposition of the expansion of banks into grey area meaning uncertain legal ground in which crucially the advantage of any interpretation and codification by case law, is strongly to the advantage of who can deploy the greater resources, must be "Wriston" the biography of Walter Wriston, who created the modern Citibank from the National City Bank of New York. Precisely by expansion in grey areas of business. But the ad absurdam finality of creating ever more custom trading venues, is that you inevitably end up only being able to game yourself. The professional advantage of executing in a public market is replaced by the mind rotting process of writing your own rules and looking for where you can faithfully attest you weren't developing a rule for suitability for your trading desk abilities, you either accept you know that your own rules are already beaten by your own operations and become at best a pragmatist, of you devolve into second guessing the nature of your own company to be able to claim your rules are unbiased neutral and blind to be fair to all comers. This has turned banks into navel gazers not Watchmen over economic instability and guards of our capacity of production in daily life and ready in case of war. The regulation was wanted by banks to assure the public. This move to reliance on in house mechanisms for all of your flow, eliminate the advantage of regulation. This erodes the raisin detre of regulatory government but it far worse dissolves the conveyance of trust from government institution that the regulated bank enjoys. I am saying that one day I realised that the behaviour of banks had become self destructive and it wasn't a flu or affliction but a inherent character trait come out of much poorly understood history I think is too important to never let the public see. We need the institutions to function, too.