4 ms·

> Likelihood: essentially nil, for many, many reasons, such as: The overwhelming majority of people don’t want to maintain their own private keys, and if you do

by avmich 9y ago

> Likelihood: essentially nil, for many, many reasons, such as: The overwhelming majority of people don’t want to maintain their own private keys, and if you don’t maintain your own private keys, cryptocurrencies are essentially no different from fiat money held in banks, except for the many ways (such as the irrevocability of transactions) in which they are wildly inferior. Looks like an complete failure of imagination. Is it really that hard to assume there could be solutions to problems like that?

blattimwind 9y ago
I'd say the onus is on the cryptocurrency people to show that "the many ways [...] in which they are wildly inferior" are fixable.
- sgeisler 9y ago
  For example "irrevocability of transactions" is fixable by introducing arbitrators. This has the huge benefit of making the trade off explicit and still allowing for irrevocable transactions. With 2-of-3 multi-sig escrow services can be implemented in a decentralized and trust less way (if both parties agree no escrow agent has to be involved). Handling private keys has also become much simpler in the past years due to hardware wallets and hierarchical deterministic keys. But I can see why someone could not want to be responsible for the safekeeping of their savings.
  - root_axis 9y ago
    "Arbiter" aka a centralized authority. At that point you're better off with a bank.
  - psychedelic 9y ago
    I think we still have a long way to come in regards to handling private keys. In my efforts to get my family/friends informed on cryptocurrency it amazes me how difficult these things are. I think that is why Coinbase has been so successful. If my mom wants to hold some bitcoin, I'm sending her to coinbase. She can't be trusted with her own private keys. I'm interested to read more on the multi-sig escrow services you mentioned though. Do you have any recommended reading material on the matter? Thanks.
    - tim333 9y ago
      Here's some more on multi-sig & escrow https://coincenter.org/entry/what-is-multi-sig-and-what-can-it-do https://coincenter.org/entry/what-is-multi-sig-and-what-can-...
    - _nalply 9y ago
      Perhaps we should go physical. After all we seem to cope rather well with physical keys. Perhaps we should set up an infrastructure with 3D-printing keys and backup keys. Key scanners are able to read the key if (and only if) you insert the key. The keys are designed such that it is not possible to copy them from a picture of them. The idea is, if the majority of people understands private keys like they understand door keys, then perhaps managing cryptocurrency private keys will be possible for everybody? Perhaps with some prevention measures against physical loss or theft like Dapp-based insurance or arbitrage?
- chrisco255 9y ago
  The option to control your private keys is nice, but not necessary for crypto to thrive. Crypto key management services exist, and the average user will use these services just as they do their current banks. The difference is, key management services are much cheaper to provide than full-on banking solutions. As for the irrevocable nature of crypto transactions...this can be alleviated with smart contracts on ETH network, or likely some 3rd party will develop some kind of purchasing/account insurance that provides this service for those willing to pay for it. The nice thing is, you will have the choice as a user. That is wildly superior to the current system.
  - yorwba 9y ago
    I'm pretty sure that most of the cost of normal banking does not stem from storing the currency amounts in customer's accounts (which is analogous to storing their private keys for them), but rather from providing customer service, securing the data and compliance with regulations. A crypto-currency equivalent of a bank that could replace traditional banking for the majority of users would have all those costs as well.
  - vkou 9y ago
    The reason that full-on banking solutions are more expensive to provide is because storing money is a tiny part of what banks actually do. The primary business of a bank is extending credit. Of course it's easier to build a wallet app then run a bank - the former's scope is orders of magnitude smaller. It (and also the role they play in wealth management and fraud prevention) is why banking devours such a large percentage of our gdp. It's not going to be replaced by another Bitcoin fork.
rjkennedy98 9y ago
That line caught my attention also. Right now most people don't maintain their own private keys, most have online wallets such as Coinbase do that for them.
- screaminghawk 9y ago
  That was already addressed, in the parent comment's quote > and if you don’t maintain your own private keys, cryptocurrencies are essentially no different from fiat money held in banks
root_axis 9y ago
Why should I have to comb through my imagination looking for a problem that fits this solution? No other technology community has to use so much exposition to convince others why their technology is useful.
- chrisco255 9y ago
  There are a lot of problems blockchain technology solves. And I would disagree. Personal computers were thought of as mostly useless hobbyist technology until years later when spreadsheets were introduced. Even then, home computers didn't exactly go mainstream until the 90s, when the internet began to take off and OS technology matured (Win 95). Cell phones suffered a similar skepticism up until the networks and pricing models matured in the late 90s. And no one needed text messaging when that first came out. You also couldn't convince most people that a data plan was worth it on the mostly useless browsers of the time.
  - nickpsecurity 9y ago
    " Personal computers were thought of as mostly useless hobbyist technology until years later when spreadsheets were introduced." "Cell phones suffered a similar skepticism" The people that invented them could tell you what you might be able to do with them and you'd find that way better than your current situation. Whereas, the design of these cryptocurrencies are worse than our current situation in a lot of ways. The problems they allegedly solve appear to be fixable with better forms of existing technology, law, etc that's used in centralized systems. The people pushing cryptocurrencies never even try to do that. They're ideologically against it rather than looking for whatever solutions are most practical. So, the potential usefulness of the desktop vs the terminals connecting to shared mainframes/minicomputers or mobile phones vs fixed-location phones is nothing like banks, cards, Venmo, and contracts vs Bitcoin or Ethereum. Actually, the current system works so well at what it does that most people are happy with it. The gripes they have are usually on policies, fees, etc that a non-profit, centralized, customer-focused organization can solve. A series of them cooperating via a standard protocol (i.e. better SWIFT) across jurisdictions and currencies can reduce those risks, too. There's nothing about the problems of current system that makes most people think: let's ditch existing currencies, databases, and accounting practices for decentralized, blockchain-based, crypto algorithms. A solution in search of a problem is an apt phrase.
canoebuilder 9y ago
>Is it really that hard to assume there could be solutions to problems like that? That's kind of venturing into a recursive loop of pointlessness. The "problems like that" you mention, are actually the ostensible "solutions" that cryptocurrency was designed to provide. So the solution to those "problem solutions," is to acknowledge that 10 years of cryptocurrencies with little more to show than Willybots and hot potato hype-machines, says something about their essential value to most of society.
paulsutter 9y ago
Or even better, just describe each shortcoming as an opportunity.
marknadal 9y ago
There are already solutions for that! We've had one out for a year: https://hackernoon.com/so-you-want-to-build-a-p2p-twitter-with-e2e-encryption-f90505b2ff8 https://hackernoon.com/so-you-want-to-build-a-p2p-twitter-wi...

by avmich 9y ago

blattimwind 9y ago

I'd say the onus is on the cryptocurrency people to show that "the many ways [...] in which they are wildly inferior" are fixable.

sgeisler 9y ago
For example "irrevocability of transactions" is fixable by introducing arbitrators. This has the huge benefit of making the trade off explicit and still allowing for irrevocable transactions. With 2-of-3 multi-sig escrow services can be implemented in a decentralized and trust less way (if both parties agree no escrow agent has to be involved). Handling private keys has also become much simpler in the past years due to hardware wallets and hierarchical deterministic keys. But I can see why someone could not want to be responsible for the safekeeping of their savings.
- root_axis 9y ago
  "Arbiter" aka a centralized authority. At that point you're better off with a bank.
- psychedelic 9y ago
  I think we still have a long way to come in regards to handling private keys. In my efforts to get my family/friends informed on cryptocurrency it amazes me how difficult these things are. I think that is why Coinbase has been so successful. If my mom wants to hold some bitcoin, I'm sending her to coinbase. She can't be trusted with her own private keys. I'm interested to read more on the multi-sig escrow services you mentioned though. Do you have any recommended reading material on the matter? Thanks.
  - tim333 9y ago
    Here's some more on multi-sig & escrow https://coincenter.org/entry/what-is-multi-sig-and-what-can-it-do https://coincenter.org/entry/what-is-multi-sig-and-what-can-...
  - _nalply 9y ago
    Perhaps we should go physical. After all we seem to cope rather well with physical keys. Perhaps we should set up an infrastructure with 3D-printing keys and backup keys. Key scanners are able to read the key if (and only if) you insert the key. The keys are designed such that it is not possible to copy them from a picture of them. The idea is, if the majority of people understands private keys like they understand door keys, then perhaps managing cryptocurrency private keys will be possible for everybody? Perhaps with some prevention measures against physical loss or theft like Dapp-based insurance or arbitrage?
chrisco255 9y ago
The option to control your private keys is nice, but not necessary for crypto to thrive. Crypto key management services exist, and the average user will use these services just as they do their current banks. The difference is, key management services are much cheaper to provide than full-on banking solutions. As for the irrevocable nature of crypto transactions...this can be alleviated with smart contracts on ETH network, or likely some 3rd party will develop some kind of purchasing/account insurance that provides this service for those willing to pay for it. The nice thing is, you will have the choice as a user. That is wildly superior to the current system.
- yorwba 9y ago
  I'm pretty sure that most of the cost of normal banking does not stem from storing the currency amounts in customer's accounts (which is analogous to storing their private keys for them), but rather from providing customer service, securing the data and compliance with regulations. A crypto-currency equivalent of a bank that could replace traditional banking for the majority of users would have all those costs as well.
- vkou 9y ago
  The reason that full-on banking solutions are more expensive to provide is because storing money is a tiny part of what banks actually do. The primary business of a bank is extending credit. Of course it's easier to build a wallet app then run a bank - the former's scope is orders of magnitude smaller. It (and also the role they play in wealth management and fraud prevention) is why banking devours such a large percentage of our gdp. It's not going to be replaced by another Bitcoin fork.

rjkennedy98 9y ago

That line caught my attention also. Right now most people don't maintain their own private keys, most have online wallets such as Coinbase do that for them.

screaminghawk 9y ago
That was already addressed, in the parent comment's quote > and if you don’t maintain your own private keys, cryptocurrencies are essentially no different from fiat money held in banks

root_axis 9y ago

Why should I have to comb through my imagination looking for a problem that fits this solution? No other technology community has to use so much exposition to convince others why their technology is useful.

chrisco255 9y ago
There are a lot of problems blockchain technology solves. And I would disagree. Personal computers were thought of as mostly useless hobbyist technology until years later when spreadsheets were introduced. Even then, home computers didn't exactly go mainstream until the 90s, when the internet began to take off and OS technology matured (Win 95). Cell phones suffered a similar skepticism up until the networks and pricing models matured in the late 90s. And no one needed text messaging when that first came out. You also couldn't convince most people that a data plan was worth it on the mostly useless browsers of the time.
- nickpsecurity 9y ago
  " Personal computers were thought of as mostly useless hobbyist technology until years later when spreadsheets were introduced." "Cell phones suffered a similar skepticism" The people that invented them could tell you what you might be able to do with them and you'd find that way better than your current situation. Whereas, the design of these cryptocurrencies are worse than our current situation in a lot of ways. The problems they allegedly solve appear to be fixable with better forms of existing technology, law, etc that's used in centralized systems. The people pushing cryptocurrencies never even try to do that. They're ideologically against it rather than looking for whatever solutions are most practical. So, the potential usefulness of the desktop vs the terminals connecting to shared mainframes/minicomputers or mobile phones vs fixed-location phones is nothing like banks, cards, Venmo, and contracts vs Bitcoin or Ethereum. Actually, the current system works so well at what it does that most people are happy with it. The gripes they have are usually on policies, fees, etc that a non-profit, centralized, customer-focused organization can solve. A series of them cooperating via a standard protocol (i.e. better SWIFT) across jurisdictions and currencies can reduce those risks, too. There's nothing about the problems of current system that makes most people think: let's ditch existing currencies, databases, and accounting practices for decentralized, blockchain-based, crypto algorithms. A solution in search of a problem is an apt phrase.

canoebuilder 9y ago

>Is it really that hard to assume there could be solutions to problems like that? That's kind of venturing into a recursive loop of pointlessness. The "problems like that" you mention, are actually the ostensible "solutions" that cryptocurrency was designed to provide. So the solution to those "problem solutions," is to acknowledge that 10 years of cryptocurrencies with little more to show than Willybots and hot potato hype-machines, says something about their essential value to most of society.

paulsutter 9y ago

Or even better, just describe each shortcoming as an opportunity.

marknadal 9y ago

There are already solutions for that! We've had one out for a year: https://hackernoon.com/so-you-want-to-build-a-p2p-twitter-with-e2e-encryption-f90505b2ff8 https://hackernoon.com/so-you-want-to-build-a-p2p-twitter-wi...