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Even if most exchanges are shut down and the price crashes, the network can't be undone, in that, if there's demand, it's sufficiently resilient to continue to

by dmos62 7y ago

Even if most exchanges are shut down and the price crashes, the network can't be undone, in that, if there's demand, it's sufficiently resilient to continue to exist. For crypto to function as currency we need it to be at least somewhat stable. We currently have that. We also need to be able to exchange it, which we also have. Remember that decentralized, anonymous and trustless crypto<->fiat exchanges are possible, like Bisq https://bisq.network/ https://bisq.network/

Nursie 7y ago
> if there's demand And if there isn't? One of the failure states for cryptocurrencies at present seems to be a period of falling demand accompanied with a falling hashrate, at which point the blockchain can be manipulated relatviely cheaply by bad actors and all hell breaks loose. Bisq appears to rely on bank transfer services, which are usually traceable, reversible etc, so I'm not sure it's quite the panacea one would hope.
- dmos62 7y ago
  > > if there's demand > And if there isn't? I feel like this question is meant for speculators and investors. > Bisq appears to rely on bank transfer services, which are usually traceable, reversible Bank trasnfers are of course not anonymous, but there's nothing linking them to crypto trading, because those are direct transfers from buyer to seller. The platform, Bisq, doesn't ever touch the money. Bank transfers are sometimes reversible (called chargeback), but for example for SEPA that's only in the case of theft and you're not actually obligated to return the money, but you would have to explain why you received it. The worst that I've heard happen is a bank account being frozen, because of suspect activity (unexplained transfers from many different private individuals). Bisq has effective mechanisms for dealing with the chargeback risk. If anyone reading this is at all interested in trustless system, I highly recommend taking a closer look at Bisq.
  - Nursie 7y ago
    Doesn't sound massively trustless to me, and it does sound like passing the risk of frozen accounts etc onto the user.
    - dmos62 7y ago
      It's trustless in that you don't need to trust the system. It's not risk free; however, in practice the risk has proven to be negligible. The platform is matching buyers and sellers. There isn't a middleman in the transactions, so there isn't any passing of risk. The risk of freezing your account is only a problem if trading crypto is not permited by your bank, otherwise you can just explain/prove what you're doing. Even if it's not permited, you can be smart about how you trade to minimize risk exposure. Again, it's not risk-free, but you're aware of the risks and the platform doesn't require trust (definition of trustless).
      - Nursie 7y ago
        The risk is that you start getting looked at for regular large transactions. The platform does require trust, it requires trust in the banking system and in the person you're transacting with. Not sure really what it achieves apart from delegating trust from a central authority to a disparate set of individuals. I'm not convinced that's a good thing.
        dmos62 7y ago
        Generating bizzare banking activity is one of the risks, but, again, only where what you're doing is illegal. Also, you don't have to trade in attention attracting sums. You don't have to trust the person you're trading with, because the platform uses an escrow system (multi-signature BTC addresses), account age signing (an old account is unlikely to have been stolen) and has mediation. That leaves negligible risk, of which you're aware. > delegating trust from a central authority to a disparate set of individuals. I'm not convinced that's a good thing Bisq provides very similar decentralization and privacy guarantees as Bitcoin (which is the point, because a system is as decentralized/private as its weakest link), so I'll delegate answering this to the myriad of articles about Bitcoin's trustworthiness.

by dmos62 7y ago

Nursie 7y ago

> if there's demand And if there isn't? One of the failure states for cryptocurrencies at present seems to be a period of falling demand accompanied with a falling hashrate, at which point the blockchain can be manipulated relatviely cheaply by bad actors and all hell breaks loose. Bisq appears to rely on bank transfer services, which are usually traceable, reversible etc, so I'm not sure it's quite the panacea one would hope.

dmos62 7y ago
> > if there's demand > And if there isn't? I feel like this question is meant for speculators and investors. > Bisq appears to rely on bank transfer services, which are usually traceable, reversible Bank trasnfers are of course not anonymous, but there's nothing linking them to crypto trading, because those are direct transfers from buyer to seller. The platform, Bisq, doesn't ever touch the money. Bank transfers are sometimes reversible (called chargeback), but for example for SEPA that's only in the case of theft and you're not actually obligated to return the money, but you would have to explain why you received it. The worst that I've heard happen is a bank account being frozen, because of suspect activity (unexplained transfers from many different private individuals). Bisq has effective mechanisms for dealing with the chargeback risk. If anyone reading this is at all interested in trustless system, I highly recommend taking a closer look at Bisq.
- Nursie 7y ago
  Doesn't sound massively trustless to me, and it does sound like passing the risk of frozen accounts etc onto the user.
  - dmos62 7y ago
    It's trustless in that you don't need to trust the system. It's not risk free; however, in practice the risk has proven to be negligible. The platform is matching buyers and sellers. There isn't a middleman in the transactions, so there isn't any passing of risk. The risk of freezing your account is only a problem if trading crypto is not permited by your bank, otherwise you can just explain/prove what you're doing. Even if it's not permited, you can be smart about how you trade to minimize risk exposure. Again, it's not risk-free, but you're aware of the risks and the platform doesn't require trust (definition of trustless).
    - Nursie 7y ago
      The risk is that you start getting looked at for regular large transactions. The platform does require trust, it requires trust in the banking system and in the person you're transacting with. Not sure really what it achieves apart from delegating trust from a central authority to a disparate set of individuals. I'm not convinced that's a good thing.
      - dmos62 7y ago
        Generating bizzare banking activity is one of the risks, but, again, only where what you're doing is illegal. Also, you don't have to trade in attention attracting sums. You don't have to trust the person you're trading with, because the platform uses an escrow system (multi-signature BTC addresses), account age signing (an old account is unlikely to have been stolen) and has mediation. That leaves negligible risk, of which you're aware. > delegating trust from a central authority to a disparate set of individuals. I'm not convinced that's a good thing Bisq provides very similar decentralization and privacy guarantees as Bitcoin (which is the point, because a system is as decentralized/private as its weakest link), so I'll delegate answering this to the myriad of articles about Bitcoin's trustworthiness.