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Is it really a cryptocurrency when it's completely centralized? No. This is just Facebook-bucks. Store dollars. It's has absolutely none of the benefits of a re

Is it really a cryptocurrency when it's completely centralized? No. This is just Facebook-bucks. Store dollars. It's has absolutely none of the benefits of a real cryptocurrency.

AlexCoventry 7y ago
Is the ledger public and irrepudiable, at least? That'd be something,I guess.
- deleted 7y ago
  [deleted]
root_axis 7y ago
It's as good as any ICO; exercising control isn't good for businesses, but Buterin has shown he can make it happen if the stakes are big enough, just like Zuck will also be able to do.
- RexetBlell 7y ago
  The fact that Ethereum Classic exists proves that Buterin has no control.
  - root_axis 7y ago
    No it doesn't. ETC is worth something like 2% of the value of ETH, it's a joke in comparison. Besides, the existence of "Ethereum Classic" is not something special, it's the inevitable side effect of suddenly having the balance of your ETH wallet "cloned" in a fork, you only have to lose if you don't treat both wallets like they're real.
    - celticninja 7y ago
      The existence of ETC says to me that ETH has the same problem, that is a bunch of power users can change the rules if they want to (if it is financially beneficial for them to do so). No different to a fiat currency controlled by the government.
      - magnamerc 7y ago
        Yeah that's just wrong. If you want to change the rules, you need to update the client software which means forking. Are you saying that a group of core devs can fork the chain and not have it be contentious?
        celticninja 7y ago
        That's what happened with Ethereum.
    - xtracto 7y ago
      But if the market did not like the new direction, it was super easy to move to ETC. Just like with the OpenOffice, LibreOffice fork. Everyone was free to use one or the other. The community chose.
      - root_axis 7y ago
        > The community chose The "community" chose to roll back a $40 million transaction that was very inconvenient for Vitalik. If he had instead said "code is law, and we stand by it" then ETC would never have existed in the first place. My point is, it was Vitalik's prerogative to reverse a million dollar transaction that he didn't like, a privilege reserved for the elite. Beyond that, the community didn't really have a choice either way. By definition of owning ETH you are incentivized to (primarily) support whichever chain the creator says he will continue to support. What kind of choice is that? There is no "market" in the sense you speak of, ETH users are a captive audience.
        xorcist 7y ago
        It's important to keep in mind that the creators of ETH gave themselves an order of magnitude more coins to start with than will ever be mined. While it is true that some of it has been sold many times over by now, it still creates a power dynamic within the community which can hardly be ignored. It's especially problematic for a project that was supposed to be PoS, where the coin holders are also the miners, with the privileges that brings.
  - deleted 7y ago
    [deleted]
ChainOfFools 7y ago
there seems to be a desire, arising from confusion and encouraged by opportunism, to conflate the term cryptocurrency with conventional notions of electronic cash. I've listened to people from the world bank, the IDB and at least one representative of a central bank explain to me with enthusiasm how their pet crypto and blockchain projects were creating new opportunities for their organizations. There's always some crypto consultant lurking in the background of these conversations.
- askmike 7y ago
  Having done different projects both in the public and private blockchain space, I believe the majority of the confusion comes from almost no one actually understanding the point of something like Bitcoin. While it's clear for IT people to look at a Paypal like system and point to the obvious central point of failure (the company behind it, the website "paypal.com', etc), almost no one outside of IT understands decentralization and why someone would want it. Especially after learning all the downsides you get with these kind of distributed systems (slow finality, low throughput, limited in capabilities, inefficient, open to new attack vectors).
  - max76 7y ago
    > almost no one outside of IT understands decentralization and why someone would want it I've talked to economist and political scientist that understood the implications of trading without central banks very well.
    - askmike 7y ago
      Good point. I was wrong in generalizing it into "IT people". Nevertheless the amount of people who get the pros of decentralization is too small.
- colechristensen 7y ago
  At that point and in so many circumstances the crypto part is ultimately just a different kind of database. Databases and protocols are just boring... At least from the perspective of the person using the currency. In general, who cares how Chase keeps track of my checking account? It might have this feature or that feature but when it is being used as it is there isn't much to be excited about. If you're Chase it might make life a little easier to choose one thing or the other but the rest of the world probably doesn't care.
c0wb0yc0d3r 7y ago
I can't read the article in it's entirety but decentralisation is not what makes a crypto currency a crypto currency. Visa, Master card, Joe shmoe, anyone can start a centralized ledger that uses crypto.
- colordrops 7y ago
  What sort of crypto? Just hiding the ledger behind SSL or encrypting the data is not what makes the "crypto" in cryptocurrency.
  - glitchc 7y ago
    Neither does calling it crypto, which stands for cryptography. Call it distributed ledger technology or blockchain for specific popular variations.
    - colordrops 7y ago
      Unlike a centralized ledger, a distributed ledger could not exist without cryptography.
- deleted 7y ago
  [deleted]
- SI_Rob 7y ago
  I would strongly disagree here. Decentralization, though a term fraught with poorly acknowledged and contradictory premises, is essentially the defining value proposition of cryptocurrency. Take away decentralization (which I would be more comfortable calling "aspirational decentralization" to reflect actual practice) and cryptocurrency is indistinguishable from conventional electronic currency.
- magnamerc 7y ago
  Well, Nakamoto consensus or practical byzantine fault tolerance is decentralization. It's literally how groups of nodes come to consensus.
pjc50 7y ago
> Facebook-bucks Missed opportunity to call them "Marks", although maybe only German speakers will get the joke.
- max76 7y ago
  Is this a joke about fiat currencies and their tendency to suddenly become valueless and cryptocurrencies tendency to suddenly become valueless by making a cross language pun connecting the owner of a new cryptocurrency and the name of a currency most famously known for a hyperinflation.
  - mtmail 7y ago
    Papiermark (https://en.m.wikipedia.org/wiki/German_Papiermark https://en.m.wikipedia.org/wiki/German_Papiermark) pre 1924 was the hyperinflated currency, then followed the stable Reichsmark and after World War II Deutsch Mark and East Deutsch Mark. Deutsch Mark remained until 2002 when the Euro got introduced. For Germans Mark is just a name for currency like Kronas (Sweden), Francs (France), Lira (Italy). Hyperinflation is too long ago to remember.
    - tin7in 7y ago
      > Hyperinflation is too long ago to remember. Germans use cash much more than the average Western European. The memory of hyperinflation and bank system collapse is one of the explanations why people prefer to store value in currency (often foreign currency) and not trust so much a bank or card issuer.
      - majewsky 7y ago
        Also, in West Germany, the Deutsche Mark (1948-2002) is strongly associated with the post-war economic boom. It's still a common rhetoric among conservative populists to argue for a return to the good old times ^W Mark.
        new2628 7y ago
divbyzer0 7y ago
This smells of identity verification. They offer a payment mechanism which needs to be legally compliant. Bingo! Social credit system with verified ID. The crypto part is just to make sound hip.
- pjc50 7y ago
  WeChat payment for westerners.
- narrator 7y ago
  When you get banned from Facebook for talking about whatever you can't buy or sell on the Internet anymore because you don't carry "the Mark". They are a private company so they can deal with whomever they want. You can still use cash. These tech companies want it so that if they ban you they can really screw up your life. Just look at people who have their whole Google existence wiped out because of some random policy violation.
  - netsharc 7y ago
    It's called "cloud feudalism". Amazing how accurate that term is, during feudal times, the king was free to change their terms, and if you disagreed you could shut up or get out of the kingdom, which was a difficult process and meant cutting off ties with people and business partners (or letting them know about your change of address). And if the king said "You, you did something I disliked, out!", you could protest all you want but that would fall mostly on deaf ears. Of course "deaf ears" is nowadays support emails being handled by copy-pasting bots.
yesforwhat 7y ago
> Is it really a cryptocurrency when it's completely centralized? No. What is decentralized about a handful of Chinese miners controlling all supply?
- extropy 7y ago
  That there is a well established (if expensive) method to re-take the decentralized control should things go south. Same for open source software, the best pieces are generally run by a no-nonsense autocrats.
  - emiliobumachar 7y ago
    Could you please expand? If the big Chinese miners go rogue (actually go rogue, take over a currency and actively tries to stop the larger public from taking it back), what recourse does the larger public have? Wouldn't they need more mining power, or an impractical fenced-off network that's still decentralized in some manner?
    - deleted 7y ago
      [deleted]
tuesdayrain 7y ago
If it's a currency and is implemented using cryptographic concepts, I feel comfortable calling it a cryptocurrency. "Decentralization" is a spectrum and a highly subjective one, so I don't think it should be a requirement.
- xtracto 7y ago
  Indeed nowadays a lot of people relate the word 'crypto' with Blockchain related concepts, but being crypto only entails using some cryptographic concepts. Cryptocommunication might be nothing but HTTPS/TLS. Cryptocurrency could very well be something similar, without involving Blockchain technology.
  - rakoo 7y ago
    In that case I can say that I'm doing my groceries with a cryptocurrency, because the transaction is encrypted between the terminal and the bank. That doesn't make any sense.
buboard 7y ago
Can it be exchanged in binance for bitcoin? If yes, and this gets a lot of users, then it s a huge deal, centralized or not. (And yeah it is cryptocurrency as long as it is based in Cryptography )
- magnamerc 7y ago
  It'll likely be an ERC20 token. So maybe people should be exchanging them for ETH.
magnamerc 7y ago
The only benefit I see is that it'll likely be an ERC20 token which means more gas payed to Ethereum (which is great). Also, it'll essentially be a fiat on-ramp for billions of people looking to get into real cryptocurrencies. Assuming they allow the token to be traded on crypto exchanges anyway.
- coolspot 7y ago
  I don’t think FB will use Ethereum or any other existing cryptocurrency. They would want full control and there is no reason not to run own blockchain. Also environmental impact of Ethereum mining is bad PR for Facebook.

Is it really a cryptocurrency when it's completely centralized? No. This is just Facebook-bucks. Store dollars. It's has absolutely none of the benefits of a real cryptocurrency.

AlexCoventry 7y ago

Is the ledger public and irrepudiable, at least? That'd be something,I guess.

deleted 7y ago
[deleted]

root_axis 7y ago

It's as good as any ICO; exercising control isn't good for businesses, but Buterin has shown he can make it happen if the stakes are big enough, just like Zuck will also be able to do.

RexetBlell 7y ago
The fact that Ethereum Classic exists proves that Buterin has no control.
- root_axis 7y ago
  No it doesn't. ETC is worth something like 2% of the value of ETH, it's a joke in comparison. Besides, the existence of "Ethereum Classic" is not something special, it's the inevitable side effect of suddenly having the balance of your ETH wallet "cloned" in a fork, you only have to lose if you don't treat both wallets like they're real.
  - celticninja 7y ago
    The existence of ETC says to me that ETH has the same problem, that is a bunch of power users can change the rules if they want to (if it is financially beneficial for them to do so). No different to a fiat currency controlled by the government.
    - magnamerc 7y ago
      Yeah that's just wrong. If you want to change the rules, you need to update the client software which means forking. Are you saying that a group of core devs can fork the chain and not have it be contentious?
      - celticninja 7y ago
        That's what happened with Ethereum.
  - xtracto 7y ago
    But if the market did not like the new direction, it was super easy to move to ETC. Just like with the OpenOffice, LibreOffice fork. Everyone was free to use one or the other. The community chose.
    - root_axis 7y ago
      > The community chose The "community" chose to roll back a $40 million transaction that was very inconvenient for Vitalik. If he had instead said "code is law, and we stand by it" then ETC would never have existed in the first place. My point is, it was Vitalik's prerogative to reverse a million dollar transaction that he didn't like, a privilege reserved for the elite. Beyond that, the community didn't really have a choice either way. By definition of owning ETH you are incentivized to (primarily) support whichever chain the creator says he will continue to support. What kind of choice is that? There is no "market" in the sense you speak of, ETH users are a captive audience.
      - xorcist 7y ago
        It's important to keep in mind that the creators of ETH gave themselves an order of magnitude more coins to start with than will ever be mined. While it is true that some of it has been sold many times over by now, it still creates a power dynamic within the community which can hardly be ignored. It's especially problematic for a project that was supposed to be PoS, where the coin holders are also the miners, with the privileges that brings.
- deleted 7y ago
  [deleted]

ChainOfFools 7y ago

there seems to be a desire, arising from confusion and encouraged by opportunism, to conflate the term cryptocurrency with conventional notions of electronic cash. I've listened to people from the world bank, the IDB and at least one representative of a central bank explain to me with enthusiasm how their pet crypto and blockchain projects were creating new opportunities for their organizations. There's always some crypto consultant lurking in the background of these conversations.

askmike 7y ago
Having done different projects both in the public and private blockchain space, I believe the majority of the confusion comes from almost no one actually understanding the point of something like Bitcoin. While it's clear for IT people to look at a Paypal like system and point to the obvious central point of failure (the company behind it, the website "paypal.com', etc), almost no one outside of IT understands decentralization and why someone would want it. Especially after learning all the downsides you get with these kind of distributed systems (slow finality, low throughput, limited in capabilities, inefficient, open to new attack vectors).
- max76 7y ago
  > almost no one outside of IT understands decentralization and why someone would want it I've talked to economist and political scientist that understood the implications of trading without central banks very well.
  - askmike 7y ago
    Good point. I was wrong in generalizing it into "IT people". Nevertheless the amount of people who get the pros of decentralization is too small.
colechristensen 7y ago
At that point and in so many circumstances the crypto part is ultimately just a different kind of database. Databases and protocols are just boring... At least from the perspective of the person using the currency. In general, who cares how Chase keeps track of my checking account? It might have this feature or that feature but when it is being used as it is there isn't much to be excited about. If you're Chase it might make life a little easier to choose one thing or the other but the rest of the world probably doesn't care.

c0wb0yc0d3r 7y ago

I can't read the article in it's entirety but decentralisation is not what makes a crypto currency a crypto currency. Visa, Master card, Joe shmoe, anyone can start a centralized ledger that uses crypto.

colordrops 7y ago
What sort of crypto? Just hiding the ledger behind SSL or encrypting the data is not what makes the "crypto" in cryptocurrency.
- glitchc 7y ago
  Neither does calling it crypto, which stands for cryptography. Call it distributed ledger technology or blockchain for specific popular variations.
  - colordrops 7y ago
    Unlike a centralized ledger, a distributed ledger could not exist without cryptography.
deleted 7y ago
[deleted]
SI_Rob 7y ago
I would strongly disagree here. Decentralization, though a term fraught with poorly acknowledged and contradictory premises, is essentially the defining value proposition of cryptocurrency. Take away decentralization (which I would be more comfortable calling "aspirational decentralization" to reflect actual practice) and cryptocurrency is indistinguishable from conventional electronic currency.
magnamerc 7y ago
Well, Nakamoto consensus or practical byzantine fault tolerance is decentralization. It's literally how groups of nodes come to consensus.

pjc50 7y ago

> Facebook-bucks Missed opportunity to call them "Marks", although maybe only German speakers will get the joke.

max76 7y ago
Is this a joke about fiat currencies and their tendency to suddenly become valueless and cryptocurrencies tendency to suddenly become valueless by making a cross language pun connecting the owner of a new cryptocurrency and the name of a currency most famously known for a hyperinflation.
- mtmail 7y ago
  Papiermark (https://en.m.wikipedia.org/wiki/German_Papiermark https://en.m.wikipedia.org/wiki/German_Papiermark) pre 1924 was the hyperinflated currency, then followed the stable Reichsmark and after World War II Deutsch Mark and East Deutsch Mark. Deutsch Mark remained until 2002 when the Euro got introduced. For Germans Mark is just a name for currency like Kronas (Sweden), Francs (France), Lira (Italy). Hyperinflation is too long ago to remember.
  - tin7in 7y ago
    > Hyperinflation is too long ago to remember. Germans use cash much more than the average Western European. The memory of hyperinflation and bank system collapse is one of the explanations why people prefer to store value in currency (often foreign currency) and not trust so much a bank or card issuer.
    - majewsky 7y ago
      Also, in West Germany, the Deutsche Mark (1948-2002) is strongly associated with the post-war economic boom. It's still a common rhetoric among conservative populists to argue for a return to the good old times ^W Mark.
      - new2628 7y ago

divbyzer0 7y ago

This smells of identity verification. They offer a payment mechanism which needs to be legally compliant. Bingo! Social credit system with verified ID. The crypto part is just to make sound hip.

pjc50 7y ago
WeChat payment for westerners.
narrator 7y ago
When you get banned from Facebook for talking about whatever you can't buy or sell on the Internet anymore because you don't carry "the Mark". They are a private company so they can deal with whomever they want. You can still use cash. These tech companies want it so that if they ban you they can really screw up your life. Just look at people who have their whole Google existence wiped out because of some random policy violation.
- netsharc 7y ago
  It's called "cloud feudalism". Amazing how accurate that term is, during feudal times, the king was free to change their terms, and if you disagreed you could shut up or get out of the kingdom, which was a difficult process and meant cutting off ties with people and business partners (or letting them know about your change of address). And if the king said "You, you did something I disliked, out!", you could protest all you want but that would fall mostly on deaf ears. Of course "deaf ears" is nowadays support emails being handled by copy-pasting bots.

yesforwhat 7y ago

> Is it really a cryptocurrency when it's completely centralized? No. What is decentralized about a handful of Chinese miners controlling all supply?

extropy 7y ago
That there is a well established (if expensive) method to re-take the decentralized control should things go south. Same for open source software, the best pieces are generally run by a no-nonsense autocrats.
- emiliobumachar 7y ago
  Could you please expand? If the big Chinese miners go rogue (actually go rogue, take over a currency and actively tries to stop the larger public from taking it back), what recourse does the larger public have? Wouldn't they need more mining power, or an impractical fenced-off network that's still decentralized in some manner?
  - deleted 7y ago
    [deleted]

tuesdayrain 7y ago

If it's a currency and is implemented using cryptographic concepts, I feel comfortable calling it a cryptocurrency. "Decentralization" is a spectrum and a highly subjective one, so I don't think it should be a requirement.

xtracto 7y ago
Indeed nowadays a lot of people relate the word 'crypto' with Blockchain related concepts, but being crypto only entails using some cryptographic concepts. Cryptocommunication might be nothing but HTTPS/TLS. Cryptocurrency could very well be something similar, without involving Blockchain technology.
- rakoo 7y ago
  In that case I can say that I'm doing my groceries with a cryptocurrency, because the transaction is encrypted between the terminal and the bank. That doesn't make any sense.

buboard 7y ago

Can it be exchanged in binance for bitcoin? If yes, and this gets a lot of users, then it s a huge deal, centralized or not. (And yeah it is cryptocurrency as long as it is based in Cryptography )

magnamerc 7y ago
It'll likely be an ERC20 token. So maybe people should be exchanging them for ETH.

magnamerc 7y ago

The only benefit I see is that it'll likely be an ERC20 token which means more gas payed to Ethereum (which is great). Also, it'll essentially be a fiat on-ramp for billions of people looking to get into real cryptocurrencies. Assuming they allow the token to be traded on crypto exchanges anyway.

coolspot 7y ago
I don’t think FB will use Ethereum or any other existing cryptocurrency. They would want full control and there is no reason not to run own blockchain. Also environmental impact of Ethereum mining is bad PR for Facebook.