16 ms·

There's No Good Reason to Trust Blockchain Technology

143 points by belltaco 8y ago

whttheuuu 8y ago
That's kind of the whole point of it - is that you don't need to trust it.
- amelius 8y ago
  Correction: you need to trust the technology, just not the actors.
- close04 8y ago
  No reason to trust blockchain technology. Just like anything else in life, you have to trust the foundation and the construction material to have a good product.
- ohiovr 8y ago
  Trust or not, you have to be insanely vigilant not to lose it to bad exchanges, extortionists, theft, automatic software like malware, losing a password, or media that destroys itself. Those are widespread problems I even had bitcoin destroyed on a failed thumb drive. Decentralization is a solution without a legally acceptable problem.
  - Stubb 8y ago
    > Decentralization is a solution without a legally acceptable problem. Therein lies the problem—asset forfeiture, genocide, and numerous other horrors have all been legal.
- verdverm 8y ago
  The point the author is making is that the "you don't need to trust it" is fundamentally misplaced. You do need to trust the institutions, and builders of, much in the same way you need to trust any business you choose to interact with them. The issue of public blockchain is that I now need to trust code and technology in a system where the events are no longer reversible. We know that code and technology is not perfect. This shifting where the trust is placed, without the recourse of law by peers, is why public blockchain may not make it beyond the great experiment. Now add the incentives and protections for malice... what's a reasonable person to trust in public blockchain
  - EthanHeilman 8y ago
    Lots of technological systems have non-reversible consequences. For instance hard drives and airplanes for example. Schneier is essentially identifying an inherent trade-off between trusting the correctness of a technological device vs trusting in an institution. This is a trade-off happens all over the place: 1. Many people don't encrypt their email (trust technology) and instead trust gmail and associated intelligence agencies to act in their best interest. 2. Many people encrypt their HTTP connections rather than trusting ISPs and internet providers. An important difference between encrypting HTTP connections and encrypting email is that one is far more convenient than the other. However encrypting your email does make sense in certain situations and so does Bitcoin.
    - verdverm 8y ago
      Why public Bitcoin over a bank's own blockchain solution?
      - EthanHeilman 8y ago
        Does a bank's own blockchain require trusting that bank? If so then you probably don't need a blockchain since you already have assumed a trusted third party. If you are aiming to reduce your institutional trust assumptions to me the question is why not use Bitcoin?
        verdverm 8y ago
        That's sort of my point. I actually don't care about the technology underneath. I care about the monetary system and its adherence (and recourse) to the rules of law that humans have generally agreed upon. Like, if you steal, the societal system will correct the wrong as much as they can. It's an open question as to whether public blockchains can provide for this trust and requirement.
        dkonofalski 8y ago
        I think that blockchains can provide more trust than the current system because the ledger is publicly visible. The societal system still kicks in to remediate the effects of a mistake but the blockchain is an additional tool used to provide the evidence and support for such a reversal. For me, personally, I think the best solution is a form of blockchain run by a state/federal agency. You're putting trust in an institution, yes, but the underlying technology helps support that trust.
baby 8y ago
1. yes there is a trust flow when you join a network: * you need to trust the paper behind the consensus mechanism * you need to trust the people who have implemented the client, and trust them to maintain it * you need to trust the TLS connection you use when you download the client. Meaning the whole CA system * you need to trust your own machine, when running the client * you need to trust the first peers you connect to when you join the network * after you're connected to enough peers, you can usually feel safer. But you'll still have some out-of-band comparison to do between your chain and other people's chains. 2. supply-chain with blockchain = scam to me. I'd be interested in hearing about a real use-case, but when you're trying to bridge the gap between reality and the blockchain, then it usually doesn't work well. 3. Here is my mental model of consensus and why it can be useful: we have protocols that work well when everyone is honest. They mostly break when malicious peers start appearing. Consensus is the cryptography field of study that attempts to solve this issue. You need a good chunk of people to be honest when you run such a protocol in a "public" setting. We recently discovered, with bitcoin, that financial incentives work well. So now we have: * financial incentives can help us make public consensus protocols work * research brought us good consensus mechanisms that we can use in more private settings The technology works well when you think of banking. Many banks want to cooperate in the way they exchange money between them, but they don't necessarily trust each other, or their security. So they form a protocol using a consensus mechanism. Now, a cryptocurrency is exactly the same thing, but in a way where anyone can connect directly to the backbone of these banks' infrastructure. You will necessarily have plenty of issues stemming from that: what if you lose your money, get it stolen, what if the exchange you use get hacked, etc. But the benefits are still pretty awesome: you are not going through a bank, you are directly connected to the system. Just my 2 cents.
- taylorswift_ 8y ago
  I completely agree with this. Why would the average Joe trust the chain you describe more than a Corporation with a physical address and humans to interact with? What are your thoughts on stuff like the many blockchain real estate related projects? e.g. "tokenized real estate" "100% liquidity" etc etc.
  - 8y ago
baxtr 8y ago
I hate blockchain so much and I can’t even exactly say why. Not because of the technology itself. I care about it as much as any other technology. I think it’s because of the sleazy non-tech people that suddenly turned into “experts” raising money for their BC startup, people organizing meetups, becoming “consultants” and of course the whole crypto craze... I really wish it will die soon.
- vbo 8y ago
  Try focusing on the technology, its merits and its potential (or lack thereof, depending which side you lean). I find that works for me, although sifting through the rancor and the mindless shilling all so prevalent in the crypto communities is rather saddening.
  - jvagner 8y ago
    it's happened before that the people / community / culture of a thing had more to do with its success / failure than the technology itself. VHS/betamax, for instance. imo, blockchain as we know it today can't survive the wilding of these platforms, the stories around the cretins and thieves involved. it'll have to evolve to something that doesn't resemble "blockchain" as we talk about it today (cloud versus devops versus sysadmins, etc). a new keystone of this technology will have to carry it far away and make it kind of different for this to be the thing we're still talking about 10 years from now.
- yodsanklai 8y ago
  No need to be so passionate about it. It may not change the world but it's a very cool technology.
- DyslexicAtheist 8y ago
  I like the tech but can't stand the hype. It's become impossible to follow or engage in any discussions around the topic since the shills have taken over this space. I also like quicksort and fibonacci numbers but would I try to start a business based on this? Probably not. I want to see legit tech being built that uses blockchains but as soon as it ends up being on a business plan or mentioned in marketing material my gagging reflex sets in.
bli940505 8y ago
"Private blockchains are completely uninteresting. (By this, I mean systems that use the blockchain data structure but don’t have the above three elements.) ... Consensus protocols have been studied in distributed systems for more than 60 years. Append-only data structures have been similarly well covered." I don't entire agree with this. Yes, distributed systems and various consensus protocols have been studied for many years, but the cryptocurrency boom boosted public interest and applicational development in a way that would not have happened without it. Private blockchain can have many benefits compared to centralized models. It's not necessarily better and it's more of a trade-off, but it does present solutions that's not otherwise possible. For example, in a distributed system, we can use IoT devices as lightweight nodes for quick validations. This can give security to off-site locations with limited computation power and/or connectivity. In addition, there's now many consensus protocols that tries to solve or amend the three elements the author mentioned. For example, Stellar-Lumen's implementation of Federated Byzantine Agreement creates the concept of reputation on top of trust. The ledger network is public, and is essentially a directed graph of trusts. Anyone can join but other nodes pre-existing on the network may not necessarily trust your validations, so this at least amends the first element the author mentioned. In conclusion, blockchain technologies are over quoted for their finance applications. To quote a YouTube video I watched, look at blockchain technologies as the operating system, and cryptocurrency as one particular app on the operating system, like your browser. It surely is over hyped but shouldn't be hated upon solely due to the public's mistaking interest.
- verdverm 8y ago
  Private blockchains are interesting because it causes separate business to share code and data formats. There is a better interface for integrating. Plus you still get the rule of law.
  - baby 8y ago
    Good point. It also forces them to be accountable, and facilitates regulation from third parties. Something that should be welcomed when you look at how opaque banks are trying to be sometimes.
avivo 8y ago
Another classic in this genre, though more focused on world impact, is Charlie Stross's "Why I want Bitcoin to die in a fire" (2013) http://www.antipope.org/charlie/blog-static/2013/12/why-i-want-bitcoin-to-die-in-a.html http://www.antipope.org/charlie/blog-static/2013/12/why-i-wa... I may not be quite as strident as either of these takes, but I agree that the proponents are significantly overselling on a variety of axes... (while also believing that distributed append-only systems with consensus mechanisms can sometimes have value)
- splintercell 8y ago
  I don't see why you think this article is a case against Bitcoin. The article is saying "I don't want Bitcoin to exist", but nearly everything else is listing you reasons to invest in it (even if you dislike the reasons, it's like buying stocks in a company who will be bailed out, even though you don't agree with the bailout).
neals 8y ago
I've stopped loving, hating, trusting or distrusting it: My client wants to auction thousands of cars with 7 competitors. He wants parts of it on blockchain. If that's the way he can create trust within this group of competitors, so be it. Is it marketing? Maybe. But we've built it and it actually works.
- AlexCoventry 8y ago
  Got a link? Sounds interesting.
lmpostor 8y ago
>What blockchain does is shift some of the trust in people and institutions to trust in technology. You need to trust the cryptography, the protocols, the software, the computers and the network. And you need to trust them absolutely, because they’re often single points of failure. So it is still people and institutions except abstracted into pieces that are more transparent than pre-existing options. Also it is always hilarious to see the rehashed arguments over and over. First being that necessity of a blockchain is a requirement for successful implementation, and second the complete negation of systems where it actually is a necessity.
jondubois 8y ago
If you're a technical person, you don't need to trust Blockchain technology; you can verify that it works on your own. If you're not a technical person, you can find independent technical experts to verify it for you. Much of the value of a cryptocurrency can be attributed to the fact that it's difficult to coordinate a large number of people to agree on changes. Also, because most blockchains are public ledgers; it's impossible to manipulate them behind the scenes without raising alarms. On the other hand, fiat money is constantly being secretly manipulated. There is very little transparency and much of the new fiat money which flows into the system has to pass through big financial firms/gatekeepers who get their cut of the new money supply. Big finance firms have had many decades to figure out how to game the fiat system and there is no doubt that they've been successful at it. Cryptocurrencies have the potential to greatly improve the financial system by making it simpler, fairer and more transparent. When anyone will be able to launch their own cryptocurrency, we will have a chance to free ourselves from the coercive influences of debt, venture capital and corporations.
- cphoover 8y ago
  "If you're a technical person, you don't need to trust Blockchain technology; you can verify that it works on your own. If you're not a technical person, you can find independent technical experts to verify it for you." That holds for Proof-of-work based currencies... It seems like it's trickier than that for proof-of-stake, as these have to be trustful systems.
  - baby 8y ago
    Indeed, the proof-of-work of bitcoin is way easier to understand than the byzantine agreements used by other cryptocurrencies.
  - jameslevy 8y ago
    Because exit scams are a thing, it may be difficult to prove that a proof of stake blockchain will always be trustworthy, but it should be possible to verify that historic proof of stake records are accurate. I'd expect we will see some independent auditing tools of this type for monitoring PoS blockchains.
scottlocklin 8y ago
1) Schneier evidently doesn't understand alternative consensus algos to mining. That's OK; they're hard to understand. Even permissioned chains apparently hard to understand. 2) Schneier doesn't understand that some people choose to trust the cryptocurrency community more than the banking/government community. If he looked at the first block of bitcoin aka "The Times 03/Jan/2009 Chancellor on brink of second bailout for banks" he'd understand why this seems reasonable to many.
- VikingCoder 8y ago
  I think it's folly to assert that the only reason someone disagrees with you is that they "don't understand". I hope you get a chance to see Schneier directly challenged on those topics.
  - scottlocklin 8y ago
    Well, he seems to think consensus = mining; I got news for you -that's not even remotely true! He also seems to think permissioned chains are worthless; hyperledger fabric seems to have a whole lot of investment for a worthless thing. And things like EOS which blend voting/stake with permissioning seem to work reasonably well, even if an EC2 crash would probably take them down. I'm no blockchain maximalist, and I understand the disgust at the hype around it, but it is an important tech, and Schneier obviously has done no real thinking on the subject. He doesn't even make a distinction between "coins" and ... blockchains. They're not the same! This is only his misunderstanding of the technical aspects. As I said above, he also misunderstands the social aspects. Some people really trust the crypto community more than they trust banks/governments. It's at least a reasonable hedge, particularly in light of the events described in the bitcoin genesis block.
deleted 8y ago
[deleted]
devy 8y ago
I chuckled when I saw the embedded tweet from Vint Cerf: https://twitter.com/vgcerf/status/1019987651301081089 https://twitter.com/vgcerf/status/1019987651301081089
fdggdfsvscvsd 8y ago
Maybe with Bitcoin I have to trust the software a little bit, but at least if it turns out to be faulty, I can switch to another app. That's much harder to do with governments controlling fiat money. Or with banks. What is a person supposed to do, who is denied financial transactions by the established financial service providers (paypal, credit cards,...)? There have now been several cases where paypal and others have tried to silence people by cancelling their accounts. What can you do, in the traditional banking world? And many complaints are not about things Bitcoin actually promises to do. It doesn't promise to make exchanges safe. The environmental impact is a concern. Miner power perhaps not so much. For example mining hardware coming from one company doesn't seem that bad - you can simply verify the transactions the miners find before sending them out to the network.
- nixpulvis 8y ago
  Am I missing something, "switch to another app" in this context also means finding buyers for all your bitcoin and exchanging them for whatever your new coin-de-jour is.
  - fdggdfsvscvsd 8y ago
    No another app is just another implementation for a wallet. That is what I meant by apps - in response to Schneier's argument that you have to trust the software anyway.
- stcredzero 8y ago
  That's much harder to do with governments controlling fiat money. What about government supported fiat money implemented with blockchain? The best way to implement that would be to preserve as many of the attributes of blockchain as possible. So the government could take coins in their possession out of circulation, or change mining parameters to print more money. Perhaps they could even print money just by signing it. However, they would not be able to make money disappear out of other party's accounts. And many complaints are not about things Bitcoin actually promises to do. It doesn't promise to make exchanges safe. Is it really viable not to have safe exchanges?
tcrow 8y ago
The author has demonstrated a very amateurish understanding and greatly conflated Bitcoin technology with blockchain technology in general, drawing the reader to make the same poor conclusions as the author. Just a quick example > "The second element is the consensus algorithm, which is a way to ensure all the copies of the ledger are the same. This is generally called mining;" - except that is only applicable for (proof of work POW) consensus and does not apply to proof of stake (POS) and delegated proof of stack (DPOS) which several of the top blockchain projects are currently using (even Ethereum is moving to POS). Both of which are far more environmentally friendly and use asset ownership (stake) as the mechanism for consensus, which is much more reliable (in a trust sense). Gosh there is so much that is conflated here. The article can be completely deconstructed but I just don't have the time. It's unfortunate this is coming from Wired. Tsk. Tsk.
- drugme 8y ago
  I read the Bitcoin mentions as examples, but not conflations of the overall issues with blockchains. Except that is only applicable for (proof of work POW) consensus and does not apply to proof of stake (POS) and delegated proof of stack (DPOS) which several of the top blockchain projects are currently using (even Ethereum is moving to POS) The fact that while what you just said, in attempting to "clarify" the issue, might make sense to a technical practitioner -- but is sheer gobbledygook to a lay person -- lies at the heart of the disconnect between the Cult of the Blockchain, and the real human beings (and their needs) it purports to serve. It's unfortunate this is coming from Wired. It's written by one of the most respected analysts in the industry.
  - tcrow 8y ago
    Except for that fact that he proceeds to use Bitcoin as the sole example of all the inherent problems of "Blockchain Technology" while providing absolutely no information about all the ways that Blockchain Technology has improved beyond what Bitcoin is doing. Bitcoin != Blockchain (in totality) He may be a respected analyst, but he is providing a completely biased and uninformed view of Blockchain technology as it currently exists. That is a bad analyst in my opinion.
darawk 8y ago
> What blockchain does is shift some of the trust in people and institutions to trust in technology. You need to trust the cryptography, the protocols, the software, the computers and the network. And you need to trust them absolutely, because they’re often single points of failure. This is wrong. You do not need to trust them, because you can verify their correctness yourself. You cannot similarly inspect the rectitude of your local bank manager's moral compass. I find it very odd that someone like Schneier wouldn't recognize this obvious truth. Is there "no reason to trust AES" because you have to trust the implementation? What kind of silly argument is that?
- afgkonionio 8y ago
  >You do not need to trust them, because you can verify their correctness yourself. I certainly cannot verify their correctness myself, and I'm a professional programmer! I don't touch cryptography with a thirteen-and-a-half foot pole. Most people wouldn't even know where to start. Only a tiny minority has the skills to singlehandedly verify the economic theory, cryptography, and implementation of a cryptocurrency. Pretty much all the time, you're trusting other people to have caught bugs and malicious code for you. Many independent reviewers are far more trustworthy than a normal company (which is why I avoid proprietary software), but that doesn't mean you aren't taking someone else's word that the software works as advertised.
  - darawk 8y ago
    Sure, but nobody uses that argument to say that you can't trust AES, RSA or SSL, despite the fact that it applies equally well to them.
  - amanaplanacanal 8y ago
    Piling on to your comment: even the experts get it wrong. Even if you are the most knowledgeable person in the world, you are going to miss things. Nobody can "verify the correctness", it's not technically possible.
    - darawk 8y ago
blocker 8y ago
As of today, blockchain doesn't deserve much trust. Agreed. But it's the early days of blockchain and the experimenting, particularly with certain applications such as crypto currencies, will continue for a few years or even decades. However, if Blockchain projects try hard not to make the same mistakes as today’s broken digital platforms, we might be able to trust in a trustless world... here is my post from yesterday on the topic: https://www.ankerventures.com/blog/trustless-new-world https://www.ankerventures.com/blog/trustless-new-world
arisAlexis 8y ago
Author fails to mention that people for sure not only don't trust banks but also governments. the whole argument that trust is not needed because institutions fails in all failed states that author happens not to live in. I remind you the "chancellor on bring of second bailout". that's the value proposition. Lastly, author can't spell Ethereum
arisAlexis 8y ago
YC is very Blockchain friendly, Wozniak likes it,Larry Page is mining Ethereum, Jack will bring Bitcoin micropayments to Twitter, inventor of javascript runs a crypto browser now and Reddit CEO loves it too. I wonder why the top comment here is someone that hates bitcoin with all his power. A psychology study will surely be interesting about why some techies hate it so much really.
as300 8y ago
> These four elements work together to enable trust. Take banking, for example. Financial institutions, merchants, and individuals are all concerned with their reputations, which prevents theft and fraud. The laws and regulations surrounding every aspect of banking keep everyone in line, including backstops that limit risks in the case of fraud. And there are lots of security systems in place, from anti-counterfeiting technologies to internet-security technologies. The problem isn't that banks and the government don't trust each other, it's that the people don't trust the banks and governments (see: crisis with the Bank of Cyprus). If there's one thing I trust, it's that a bitcoin that I 'own' will stay mine (barring oversight on my own part). I have less trust that money in the bank will stay my own.
trumped 8y ago
This extends to: There's no good reason to trust computers... (including Apple)... there are exploits, negligence and malice left and right

143 points by belltaco 8y ago

whttheuuu 8y ago

That's kind of the whole point of it - is that you don't need to trust it.

amelius 8y ago
Correction: you need to trust the technology, just not the actors.
close04 8y ago
No reason to trust blockchain technology. Just like anything else in life, you have to trust the foundation and the construction material to have a good product.
ohiovr 8y ago
Trust or not, you have to be insanely vigilant not to lose it to bad exchanges, extortionists, theft, automatic software like malware, losing a password, or media that destroys itself. Those are widespread problems I even had bitcoin destroyed on a failed thumb drive. Decentralization is a solution without a legally acceptable problem.
- Stubb 8y ago
  > Decentralization is a solution without a legally acceptable problem. Therein lies the problem—asset forfeiture, genocide, and numerous other horrors have all been legal.
verdverm 8y ago
The point the author is making is that the "you don't need to trust it" is fundamentally misplaced. You do need to trust the institutions, and builders of, much in the same way you need to trust any business you choose to interact with them. The issue of public blockchain is that I now need to trust code and technology in a system where the events are no longer reversible. We know that code and technology is not perfect. This shifting where the trust is placed, without the recourse of law by peers, is why public blockchain may not make it beyond the great experiment. Now add the incentives and protections for malice... what's a reasonable person to trust in public blockchain
- EthanHeilman 8y ago
  Lots of technological systems have non-reversible consequences. For instance hard drives and airplanes for example. Schneier is essentially identifying an inherent trade-off between trusting the correctness of a technological device vs trusting in an institution. This is a trade-off happens all over the place: 1. Many people don't encrypt their email (trust technology) and instead trust gmail and associated intelligence agencies to act in their best interest. 2. Many people encrypt their HTTP connections rather than trusting ISPs and internet providers. An important difference between encrypting HTTP connections and encrypting email is that one is far more convenient than the other. However encrypting your email does make sense in certain situations and so does Bitcoin.
  - verdverm 8y ago
    Why public Bitcoin over a bank's own blockchain solution?
    - EthanHeilman 8y ago
      Does a bank's own blockchain require trusting that bank? If so then you probably don't need a blockchain since you already have assumed a trusted third party. If you are aiming to reduce your institutional trust assumptions to me the question is why not use Bitcoin?
      - verdverm 8y ago
        That's sort of my point. I actually don't care about the technology underneath. I care about the monetary system and its adherence (and recourse) to the rules of law that humans have generally agreed upon. Like, if you steal, the societal system will correct the wrong as much as they can. It's an open question as to whether public blockchains can provide for this trust and requirement.
        dkonofalski 8y ago
        I think that blockchains can provide more trust than the current system because the ledger is publicly visible. The societal system still kicks in to remediate the effects of a mistake but the blockchain is an additional tool used to provide the evidence and support for such a reversal. For me, personally, I think the best solution is a form of blockchain run by a state/federal agency. You're putting trust in an institution, yes, but the underlying technology helps support that trust.

baby 8y ago

1. yes there is a trust flow when you join a network: * you need to trust the paper behind the consensus mechanism * you need to trust the people who have implemented the client, and trust them to maintain it * you need to trust the TLS connection you use when you download the client. Meaning the whole CA system * you need to trust your own machine, when running the client * you need to trust the first peers you connect to when you join the network * after you're connected to enough peers, you can usually feel safer. But you'll still have some out-of-band comparison to do between your chain and other people's chains. 2. supply-chain with blockchain = scam to me. I'd be interested in hearing about a real use-case, but when you're trying to bridge the gap between reality and the blockchain, then it usually doesn't work well. 3. Here is my mental model of consensus and why it can be useful: we have protocols that work well when everyone is honest. They mostly break when malicious peers start appearing. Consensus is the cryptography field of study that attempts to solve this issue. You need a good chunk of people to be honest when you run such a protocol in a "public" setting. We recently discovered, with bitcoin, that financial incentives work well. So now we have: * financial incentives can help us make public consensus protocols work * research brought us good consensus mechanisms that we can use in more private settings The technology works well when you think of banking. Many banks want to cooperate in the way they exchange money between them, but they don't necessarily trust each other, or their security. So they form a protocol using a consensus mechanism. Now, a cryptocurrency is exactly the same thing, but in a way where anyone can connect directly to the backbone of these banks' infrastructure. You will necessarily have plenty of issues stemming from that: what if you lose your money, get it stolen, what if the exchange you use get hacked, etc. But the benefits are still pretty awesome: you are not going through a bank, you are directly connected to the system. Just my 2 cents.

taylorswift_ 8y ago
I completely agree with this. Why would the average Joe trust the chain you describe more than a Corporation with a physical address and humans to interact with? What are your thoughts on stuff like the many blockchain real estate related projects? e.g. "tokenized real estate" "100% liquidity" etc etc.
- 8y ago

baxtr 8y ago

I hate blockchain so much and I can’t even exactly say why. Not because of the technology itself. I care about it as much as any other technology. I think it’s because of the sleazy non-tech people that suddenly turned into “experts” raising money for their BC startup, people organizing meetups, becoming “consultants” and of course the whole crypto craze... I really wish it will die soon.

vbo 8y ago
Try focusing on the technology, its merits and its potential (or lack thereof, depending which side you lean). I find that works for me, although sifting through the rancor and the mindless shilling all so prevalent in the crypto communities is rather saddening.
- jvagner 8y ago
  it's happened before that the people / community / culture of a thing had more to do with its success / failure than the technology itself. VHS/betamax, for instance. imo, blockchain as we know it today can't survive the wilding of these platforms, the stories around the cretins and thieves involved. it'll have to evolve to something that doesn't resemble "blockchain" as we talk about it today (cloud versus devops versus sysadmins, etc). a new keystone of this technology will have to carry it far away and make it kind of different for this to be the thing we're still talking about 10 years from now.
yodsanklai 8y ago
No need to be so passionate about it. It may not change the world but it's a very cool technology.
DyslexicAtheist 8y ago
I like the tech but can't stand the hype. It's become impossible to follow or engage in any discussions around the topic since the shills have taken over this space. I also like quicksort and fibonacci numbers but would I try to start a business based on this? Probably not. I want to see legit tech being built that uses blockchains but as soon as it ends up being on a business plan or mentioned in marketing material my gagging reflex sets in.

bli940505 8y ago

"Private blockchains are completely uninteresting. (By this, I mean systems that use the blockchain data structure but don’t have the above three elements.) ... Consensus protocols have been studied in distributed systems for more than 60 years. Append-only data structures have been similarly well covered." I don't entire agree with this. Yes, distributed systems and various consensus protocols have been studied for many years, but the cryptocurrency boom boosted public interest and applicational development in a way that would not have happened without it. Private blockchain can have many benefits compared to centralized models. It's not necessarily better and it's more of a trade-off, but it does present solutions that's not otherwise possible. For example, in a distributed system, we can use IoT devices as lightweight nodes for quick validations. This can give security to off-site locations with limited computation power and/or connectivity. In addition, there's now many consensus protocols that tries to solve or amend the three elements the author mentioned. For example, Stellar-Lumen's implementation of Federated Byzantine Agreement creates the concept of reputation on top of trust. The ledger network is public, and is essentially a directed graph of trusts. Anyone can join but other nodes pre-existing on the network may not necessarily trust your validations, so this at least amends the first element the author mentioned. In conclusion, blockchain technologies are over quoted for their finance applications. To quote a YouTube video I watched, look at blockchain technologies as the operating system, and cryptocurrency as one particular app on the operating system, like your browser. It surely is over hyped but shouldn't be hated upon solely due to the public's mistaking interest.

verdverm 8y ago
Private blockchains are interesting because it causes separate business to share code and data formats. There is a better interface for integrating. Plus you still get the rule of law.
- baby 8y ago
  Good point. It also forces them to be accountable, and facilitates regulation from third parties. Something that should be welcomed when you look at how opaque banks are trying to be sometimes.

avivo 8y ago

Another classic in this genre, though more focused on world impact, is Charlie Stross's "Why I want Bitcoin to die in a fire" (2013) http://www.antipope.org/charlie/blog-static/2013/12/why-i-want-bitcoin-to-die-in-a.html http://www.antipope.org/charlie/blog-static/2013/12/why-i-wa... I may not be quite as strident as either of these takes, but I agree that the proponents are significantly overselling on a variety of axes... (while also believing that distributed append-only systems with consensus mechanisms can sometimes have value)

splintercell 8y ago
I don't see why you think this article is a case against Bitcoin. The article is saying "I don't want Bitcoin to exist", but nearly everything else is listing you reasons to invest in it (even if you dislike the reasons, it's like buying stocks in a company who will be bailed out, even though you don't agree with the bailout).

neals 8y ago

I've stopped loving, hating, trusting or distrusting it: My client wants to auction thousands of cars with 7 competitors. He wants parts of it on blockchain. If that's the way he can create trust within this group of competitors, so be it. Is it marketing? Maybe. But we've built it and it actually works.

AlexCoventry 8y ago
Got a link? Sounds interesting.

lmpostor 8y ago

>What blockchain does is shift some of the trust in people and institutions to trust in technology. You need to trust the cryptography, the protocols, the software, the computers and the network. And you need to trust them absolutely, because they’re often single points of failure. So it is still people and institutions except abstracted into pieces that are more transparent than pre-existing options. Also it is always hilarious to see the rehashed arguments over and over. First being that necessity of a blockchain is a requirement for successful implementation, and second the complete negation of systems where it actually is a necessity.

jondubois 8y ago

If you're a technical person, you don't need to trust Blockchain technology; you can verify that it works on your own. If you're not a technical person, you can find independent technical experts to verify it for you. Much of the value of a cryptocurrency can be attributed to the fact that it's difficult to coordinate a large number of people to agree on changes. Also, because most blockchains are public ledgers; it's impossible to manipulate them behind the scenes without raising alarms. On the other hand, fiat money is constantly being secretly manipulated. There is very little transparency and much of the new fiat money which flows into the system has to pass through big financial firms/gatekeepers who get their cut of the new money supply. Big finance firms have had many decades to figure out how to game the fiat system and there is no doubt that they've been successful at it. Cryptocurrencies have the potential to greatly improve the financial system by making it simpler, fairer and more transparent. When anyone will be able to launch their own cryptocurrency, we will have a chance to free ourselves from the coercive influences of debt, venture capital and corporations.

cphoover 8y ago
"If you're a technical person, you don't need to trust Blockchain technology; you can verify that it works on your own. If you're not a technical person, you can find independent technical experts to verify it for you." That holds for Proof-of-work based currencies... It seems like it's trickier than that for proof-of-stake, as these have to be trustful systems.
- baby 8y ago
  Indeed, the proof-of-work of bitcoin is way easier to understand than the byzantine agreements used by other cryptocurrencies.
- jameslevy 8y ago
  Because exit scams are a thing, it may be difficult to prove that a proof of stake blockchain will always be trustworthy, but it should be possible to verify that historic proof of stake records are accurate. I'd expect we will see some independent auditing tools of this type for monitoring PoS blockchains.

scottlocklin 8y ago

1) Schneier evidently doesn't understand alternative consensus algos to mining. That's OK; they're hard to understand. Even permissioned chains apparently hard to understand. 2) Schneier doesn't understand that some people choose to trust the cryptocurrency community more than the banking/government community. If he looked at the first block of bitcoin aka "The Times 03/Jan/2009 Chancellor on brink of second bailout for banks" he'd understand why this seems reasonable to many.

VikingCoder 8y ago
I think it's folly to assert that the only reason someone disagrees with you is that they "don't understand". I hope you get a chance to see Schneier directly challenged on those topics.
- scottlocklin 8y ago
  Well, he seems to think consensus = mining; I got news for you -that's not even remotely true! He also seems to think permissioned chains are worthless; hyperledger fabric seems to have a whole lot of investment for a worthless thing. And things like EOS which blend voting/stake with permissioning seem to work reasonably well, even if an EC2 crash would probably take them down. I'm no blockchain maximalist, and I understand the disgust at the hype around it, but it is an important tech, and Schneier obviously has done no real thinking on the subject. He doesn't even make a distinction between "coins" and ... blockchains. They're not the same! This is only his misunderstanding of the technical aspects. As I said above, he also misunderstands the social aspects. Some people really trust the crypto community more than they trust banks/governments. It's at least a reasonable hedge, particularly in light of the events described in the bitcoin genesis block.

deleted 8y ago

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devy 8y ago

I chuckled when I saw the embedded tweet from Vint Cerf: https://twitter.com/vgcerf/status/1019987651301081089 https://twitter.com/vgcerf/status/1019987651301081089

fdggdfsvscvsd 8y ago

Maybe with Bitcoin I have to trust the software a little bit, but at least if it turns out to be faulty, I can switch to another app. That's much harder to do with governments controlling fiat money. Or with banks. What is a person supposed to do, who is denied financial transactions by the established financial service providers (paypal, credit cards,...)? There have now been several cases where paypal and others have tried to silence people by cancelling their accounts. What can you do, in the traditional banking world? And many complaints are not about things Bitcoin actually promises to do. It doesn't promise to make exchanges safe. The environmental impact is a concern. Miner power perhaps not so much. For example mining hardware coming from one company doesn't seem that bad - you can simply verify the transactions the miners find before sending them out to the network.

nixpulvis 8y ago
Am I missing something, "switch to another app" in this context also means finding buyers for all your bitcoin and exchanging them for whatever your new coin-de-jour is.
- fdggdfsvscvsd 8y ago
  No another app is just another implementation for a wallet. That is what I meant by apps - in response to Schneier's argument that you have to trust the software anyway.
stcredzero 8y ago
That's much harder to do with governments controlling fiat money. What about government supported fiat money implemented with blockchain? The best way to implement that would be to preserve as many of the attributes of blockchain as possible. So the government could take coins in their possession out of circulation, or change mining parameters to print more money. Perhaps they could even print money just by signing it. However, they would not be able to make money disappear out of other party's accounts. And many complaints are not about things Bitcoin actually promises to do. It doesn't promise to make exchanges safe. Is it really viable not to have safe exchanges?

tcrow 8y ago

The author has demonstrated a very amateurish understanding and greatly conflated Bitcoin technology with blockchain technology in general, drawing the reader to make the same poor conclusions as the author. Just a quick example > "The second element is the consensus algorithm, which is a way to ensure all the copies of the ledger are the same. This is generally called mining;" - except that is only applicable for (proof of work POW) consensus and does not apply to proof of stake (POS) and delegated proof of stack (DPOS) which several of the top blockchain projects are currently using (even Ethereum is moving to POS). Both of which are far more environmentally friendly and use asset ownership (stake) as the mechanism for consensus, which is much more reliable (in a trust sense). Gosh there is so much that is conflated here. The article can be completely deconstructed but I just don't have the time. It's unfortunate this is coming from Wired. Tsk. Tsk.

drugme 8y ago
I read the Bitcoin mentions as examples, but not conflations of the overall issues with blockchains. Except that is only applicable for (proof of work POW) consensus and does not apply to proof of stake (POS) and delegated proof of stack (DPOS) which several of the top blockchain projects are currently using (even Ethereum is moving to POS) The fact that while what you just said, in attempting to "clarify" the issue, might make sense to a technical practitioner -- but is sheer gobbledygook to a lay person -- lies at the heart of the disconnect between the Cult of the Blockchain, and the real human beings (and their needs) it purports to serve. It's unfortunate this is coming from Wired. It's written by one of the most respected analysts in the industry.
- tcrow 8y ago
  Except for that fact that he proceeds to use Bitcoin as the sole example of all the inherent problems of "Blockchain Technology" while providing absolutely no information about all the ways that Blockchain Technology has improved beyond what Bitcoin is doing. Bitcoin != Blockchain (in totality) He may be a respected analyst, but he is providing a completely biased and uninformed view of Blockchain technology as it currently exists. That is a bad analyst in my opinion.

darawk 8y ago

> What blockchain does is shift some of the trust in people and institutions to trust in technology. You need to trust the cryptography, the protocols, the software, the computers and the network. And you need to trust them absolutely, because they’re often single points of failure. This is wrong. You do not need to trust them, because you can verify their correctness yourself. You cannot similarly inspect the rectitude of your local bank manager's moral compass. I find it very odd that someone like Schneier wouldn't recognize this obvious truth. Is there "no reason to trust AES" because you have to trust the implementation? What kind of silly argument is that?

afgkonionio 8y ago
>You do not need to trust them, because you can verify their correctness yourself. I certainly cannot verify their correctness myself, and I'm a professional programmer! I don't touch cryptography with a thirteen-and-a-half foot pole. Most people wouldn't even know where to start. Only a tiny minority has the skills to singlehandedly verify the economic theory, cryptography, and implementation of a cryptocurrency. Pretty much all the time, you're trusting other people to have caught bugs and malicious code for you. Many independent reviewers are far more trustworthy than a normal company (which is why I avoid proprietary software), but that doesn't mean you aren't taking someone else's word that the software works as advertised.
- darawk 8y ago
  Sure, but nobody uses that argument to say that you can't trust AES, RSA or SSL, despite the fact that it applies equally well to them.
- amanaplanacanal 8y ago
  Piling on to your comment: even the experts get it wrong. Even if you are the most knowledgeable person in the world, you are going to miss things. Nobody can "verify the correctness", it's not technically possible.
  - darawk 8y ago

blocker 8y ago

As of today, blockchain doesn't deserve much trust. Agreed. But it's the early days of blockchain and the experimenting, particularly with certain applications such as crypto currencies, will continue for a few years or even decades. However, if Blockchain projects try hard not to make the same mistakes as today’s broken digital platforms, we might be able to trust in a trustless world... here is my post from yesterday on the topic: https://www.ankerventures.com/blog/trustless-new-world https://www.ankerventures.com/blog/trustless-new-world

arisAlexis 8y ago

Author fails to mention that people for sure not only don't trust banks but also governments. the whole argument that trust is not needed because institutions fails in all failed states that author happens not to live in. I remind you the "chancellor on bring of second bailout". that's the value proposition. Lastly, author can't spell Ethereum

arisAlexis 8y ago

YC is very Blockchain friendly, Wozniak likes it,Larry Page is mining Ethereum, Jack will bring Bitcoin micropayments to Twitter, inventor of javascript runs a crypto browser now and Reddit CEO loves it too. I wonder why the top comment here is someone that hates bitcoin with all his power. A psychology study will surely be interesting about why some techies hate it so much really.

as300 8y ago

> These four elements work together to enable trust. Take banking, for example. Financial institutions, merchants, and individuals are all concerned with their reputations, which prevents theft and fraud. The laws and regulations surrounding every aspect of banking keep everyone in line, including backstops that limit risks in the case of fraud. And there are lots of security systems in place, from anti-counterfeiting technologies to internet-security technologies. The problem isn't that banks and the government don't trust each other, it's that the people don't trust the banks and governments (see: crisis with the Bank of Cyprus). If there's one thing I trust, it's that a bitcoin that I 'own' will stay mine (barring oversight on my own part). I have less trust that money in the bank will stay my own.

trumped 8y ago

This extends to: There's no good reason to trust computers... (including Apple)... there are exploits, negligence and malice left and right