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I still don't get cryptocurrencies. Yes, a blockchain works when zero trust is needed/desired for transactions, but that's still an implementation-level concern

• duado 8y ago
  It’s great for people who are sheltered enough to think that their governments are the least trustworthy organizations in existence, or who live in countries where they are.
  • treis 8y ago
    When you're buying drugs or transferring money for other illegal purposes the government is definitely the organization you have the least trust in.
    • curiousgal 8y ago
      I always find such opinions quite pigeonholed. Many third world countries do not have access to online banking or credit cards. Cryptocurencies were the only way I could pay for goods and services online and the only thing that made me feel like an actual citizen of the world and not just some content pirate.
      • treis 8y ago
        Those barriers are likely due to money laundering laws and whoever is accepting the bitcoin is (probably) breaking the law when they convert to USD or other currencies. So you're right that it's not necessarily illegal purchases so much as illegal transactions. You can break the cryptocurrency usage into 4 main groups: Speculators, Lawbreakers, Libertarian types, and Techies. Otherwise, the financial system provides cheaper or more convenient options for payment.
        • curiousgal 8y ago
          > Those barriers are likely due to money laundering laws Again, the world is much bigger and more nuanced than you think, non-covertible currencies are a thing and they are due to a country's central bank policy not money laundering laws. > the financial system provides cheaper or more convenient options for payment. No it does not, if I had had ways to pay for a server using my country's currency, I would have used it.
          • treis 8y ago
            >Again, the world is much bigger and more nuanced than you think, non-covertible currencies are a thing and they are due to a country's central bank policy not money laundering laws. What difference does it make which law or "policy" the users are circumventing? >No it does not, if I had had ways to pay for a server using my country's currency, I would have used it. And if it were legal to do so there would be a way.
        • Erlich_Bachman 8y ago
          You do realize the world is bigger than US and EU, right? That there are many other countries in the world where the situation is not the same as in the first world?
          • treis 8y ago
            No, this is the first I'm hearing of it. Please go on about these "other countries".
            • duado 8y ago
              Venezuela is a place where the government is the equivalent of a guy bursting into a shopping mall and shooting it up. In their case Bitcoin does have a genuine purpose.
              • treis 8y ago
                And that purpose is breaking Venezuelan law. If the Venezuela government weren't a bunch of gangsters and made hard currency transactions legal then they wouldn't use Bitcoin.
• coliveira 8y ago
  The worst problem in my opinion is not even this. With crypto currencies you can NEVER be sure that you are the owner of what you think you own. The only thing that guarantees your property of crypto currency is the EXCLUSIVE ownership of a private key. But what guarantees that other people don't already have access to the key you think is private, through any of the millions of forms of hacking that are available? Even if you have your private key secured nowadays, there is always the possibility that someone else in the past hacked and had access to that same private key and can use it at any time. So, even the notion private property cannot be guaranteed with crypto currencies.
  • hanniabu 8y ago
    This will all be abstracted in time. One way I can think of is to have the funds periodically moved to different addresses, and obviously don't keep all your funds in a single address. This can all be automated and abstracted.
  • sametmax 8y ago
    That's why we have the ledger.
    • deleted 8y ago
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    • mrguyorama 8y ago
      How does that stop others from gaining access to your private keys?
      • sametmax 8y ago
        It's a hardware wallet, pretty hard to hack: https://www.ledger.com/ https://www.ledger.com/
  • theli0nheart 8y ago
    The same could be said for any number of things we consider to be private property. Unless you physically can see with your own eyes everything that you "own", how do you know some bad actor hasn't run off with it? Well, our society gives us a whole bunch of protections in place which give us some peace of mind (security systems, laws, etc.), but you can't know for sure without some verification. So if you have the private key in your hand, and the address with your Bitcoin still has Bitcoin, while someone else could have your private key, why wouldn't they just transfer the money out?
• duxup 8y ago
  The number of legitimate uses seems to drop pretty dramatically when you talk about a system that is used in a zero trust situation and irreversible. I think the block chain philosophy as far as crypto currency and use for legitimate business just doesn't go hand in hand like some folks thought it might. People really don't want to do business if there is zero trust, and centralized databases, and strong courts, are fine. Even when there aren't strong courts blockchain doesn't so much fill the gap as provide a risky solution... that involves a lot of illegal and undesirable behavior.
• reidjs 8y ago
  You're right that crypto is pretty useless for people like you and I who have access to high quality bank services. But to people who don't really have access to legitimate bank services they're a godsend.
  • swarnie_ 8y ago
    Because i really don't know.... How common is it to have access to electricity, an internet capable device, internet connection and a knowledge of cryptocurrencies but not a bank?
    • knorker 8y ago
      It's not. It's the same logic where cryptocurrency advocates say that if a country's currency goes down the crapper then the people can use bitcoin, and the country can't break that! But why can't they just use dollars, or euros, instead? Because the local government would make that illegal! Why wouldn't they make bitcoin use illegal? Because... because... shut up!
    • deleted 8y ago
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    • DanBC 8y ago
      In the UK a "fraud marker" will make it very difficult for a person to open a bank account.
      • knorker 8y ago
        "I only accept bitcoin" is the biggest fraud marker there is, though. :-P What I mean is that this is a non-solution to that problem.
    • golergka 8y ago
      How many banks allow you to buy drugs with your account?
      • 8y ago
• manigandham 8y ago
  A blockchain is just an immutable database that can be appended to or overwritten by majority. It doesn't have anything to do with trust and definitely doesn't provide any form of it, but trust is at the core of several human concerns like currency. Thus, blockchains are fundamentally unable to serve those uses regardless of how much hype is thrown at it.
  • basch 8y ago
    part of trust is eliminating double spend. you can "trust" that when you received ownership of the digital asset, that somebody else didnt also get a copy or equal ownership. the decentralized trust replaces an authority saying "so and so owns this" or "you already spent that dollar." this happens in an environment where participants DONT trust each other to not cheat.
    • dmitriid 8y ago
      when participants don’t trust each other, they delegate to a third party they both trust: a bank, a notary, an external accountant, etc. Blockchain provides nothing, and people end up building replicas if real-world trust systems around it (even silk road had a reputation system not built on blockchains)
    • manigandham 8y ago
      None of that has to do with blockchain. You as a human have the same trust in something. In this case, instead of a verified, regulated, audited central bank, you've decided to instead trust anonymous, unaudited, unregulated actors who vote in majority.
      • AgentME 8y ago
        There's a difference between trusting a human with your money, and trusting that you correctly understand an open system which fully incentivizes everyone to operate predictably. It's the difference between trusting Facebook to keep your messages private and trusting PGP to keep your messages private.
• syn0byte 8y ago
  What redress do you think you have even if you "trust" someone? That 100 dollar widget you bought in cash didn't work? Well fuck you, see you in court. Now what? Are you going to take the store to court over 100 bucks? Pay with a card and your card company doesn't want to reverse charges? Same problem... I'd bet that per 5000 transactions, debit and credit cards have more fraud that the 'end user' has no remediation for than bitcoin does. Sometimes, reinventing the wheel is exactly the point when the wheel has been engineered to favor the engineers.
  • deleted 8y ago
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  • jayd16 8y ago
    A block chain doesn't solve this in any way. By the time you determine your widget doesn't work, the transaction is complete.
  • yingw787 8y ago
    Of course you can stiff the legal system. But you can only stiff it so far. I Googled "Ethereum steal" and the top three results have figures in the millions, through something as straightforward as a 51% attack. No court system can simultaneously claim to be fair and just and legitimate, and let slide a $1.1M USD theft. And in such situations, other people usually have a bone to pick with said thief too, bolstering resources on your side. If a cryptocurrency scales and somebody pulls off a Madoff-level theft (>$64B USD), could you guarantee some amount of clawbacks by technology alone? I wouldn't bet on it.
    • AgentME 8y ago
      >through something as straightforward as a 51% attack ... which has never been done before on Ethereum (or Bitcoin). Are you talking about Ethereum Classic? It's something entirely different and amateur. Using it as a criticism of Ethereum is like complaining banks are untrustworthy because a kid at school called himself a bank and didn't give the money back you lent him.
  • knorker 8y ago
• andrewla 8y ago
  Why would you say that there's no legal means of redress? If someone steals my cryptocurrency, then I can still have law enforcement track them down and attempt to recover the funds. This is not dissimilar to how cash works -- if someone takes my cash, by fraud, by theft, or in legitimate exchange for goods or services, that's it. They can now spend it however they want. Cash itself is a trustless system in the same sense. Where there is trust it's largely a matter of preventing forgery; which is not dissimilar to the idea of preventing double-spends. But until Bitcoin there was no real way to do cash-like transactions electronically. In other words, the utility of Bitcoin is well-established; humans have been using cash for a very long time. The implementation is novel. I don't speak here to the general "blockchain" concept, which has become so nebulous that I don't feel it's worth making general statements about.
  • jayd16 8y ago
    If you have to rely on and/or beholden to legal action, then BTC doesn't really provide trust at all. >But until Bitcoin there was no real way to do cash-like transactions electronically. There was Venmo and all the other small cash transfer apps. BTC is decentralized but that's of questionable worth to an end user.
    • bilbo0s 8y ago
      >If you have to rely on and/or beholden to legal action, then BTC doesn't really provide trust at all... Yep. Gotta agree with Jayd16 here, if you still need law enforcement, (ie - government), then bitcoin is not useful for operating without trust. The breathless hype about bitcoin was not just the technology level "distributed ledger" thing, but also the idea that you could do things independent of the system. If you still need the system to make it all work, then it definitely fails on the latter hype point.
      • shawnz 8y ago
        > the idea that you could do things independent of the system. If you still need the system to make it all work, then it definitely fails on the latter hype point. Bitcoin is independent of the "system" but that doesn't mean you don't still need some system. You're just not locked in to any particular system. Using bitcoin doesn't automatically make you an anarchist.
• panarky 8y ago
  Your comment is irrelevant to this article. This article is about an unproven accusation that Coinomi wallets can be exploited because the seed phrase is spell-checked over a TLS connection.
  • dylkil 8y ago
    buttcoiners..."i dont get it, so it wont work"
• repomies68 8y ago
  What's wrong with reinventing the wheel? I think having alternatives for financial transactions is just a good thing in itself. Of course you don't have to use them if you don't like.
• kryogen1c 8y ago
  > Yes, a blockchain works when zero trust is needed/desired for transactions, but that's still an implementation-level concern This premise is not true and is one of the (many) reasons why blockchain is just a buzzword. Maintaining the ledger still requires trust, even if that trust is less centralized than a single company (and thats often not the case either)
• awrence 8y ago
  True cryptocurrencies, read properly decentralized (which currently means through an expensive and well distributed PoW process) allow the creation of digital assets whose issuance and transfer mechanisms can't be tempered with by a central agent. This is a true pretty massive innovation. This is not reinventing the wheel, that wheel did not exist until bitcoin showed up. It comes with unique upsides, eg: a central bank can’t inflate them, which for monetary assets, is a massive part of the valuation equation, eg: I can transact in them in a collapsed economy with no functioning money (ie venezuela). It comes with downsides, eg: if i get my bitcoin stolen I have less governmental power to find redress. But there’s a bit of a fallacy in the thinking that fiats are better from that perspective. I would argue fiats are generally the same but the government has an additional option in that they can print more money to make specific people whole. Example a bank goes under because there was fraud, someone managed to pull out fiat through some means (pulling out cash for example). Because the government owns the press they can print more fiat to make depositors whole. This isn’t a magic bullet though, because you’re in effect imposing a monetary tax on the rest of the fiat saving community by doing so. Outside of that solution, which isn’t a 0 cost one, the situation is identical to cryptos, you have to go through the courts to get your stolen holdings back. And if you lost them, it's no different than if your bundle of cash had gone up in flames or your stash of gold had gone down with a ship, you'd be out of luck. The massive thing cryptos provide is a digital savings mechanism that can’t be inflated by a central agent. If you’re a digital monetary saver, that’s a hugely compelling alternative which has a massive potential market base.
  • nradov 8y ago
    When a bank fails the US government doesn't print more currency. The depositors are made whole from an existing insurance fund, which the failed bank had been paying into the whole time (along with all other banks). It's risk pooling, not inflation.
• thefounder 8y ago
  Some people want just virtual cash. No banks, chargebacks, 3rd parties(visa, paypal etc) additional "verification" etc. Just old good "hard" cash for the XXI century.
  • mikeash 8y ago
    I’m not entirely convinced that they do. Many say that they do, but then don’t treat it the way they would treat a similar quantity of cash, lose it, and are befuddled as to how it happened.
    • thefounder 8y ago
      That's because the technology is new and people seem to trust wallets and exchangers usually developed unknown amateurs. This leads us to issue number two: Many holding crypto currencies are using the funds as investment so I assume they were aware of the high risk to loose all the funds for various reasons. Once the crypto investments/ponzi scheme is gone we can work on crypto payments.
• tim333 8y ago
  >just goes around the legal system; by doing so, you're just re-inventing the wheel. Going around the legal system is actually a big deal both for straight criminal stuff like extortion and also things that morally not too bad but where the law is a pain like raising money for ventures with less paperwork and fees or sending funds to Venezuela without the approval of its present government.