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These things are true at present but are they true in the limit? Bitcoin is the first blockchain technology to see adoption and has a present market cap of over

These things are true at present but are they true in the limit? Bitcoin is the first blockchain technology to see adoption and has a present market cap of over $200B despite scaling incredibly poorly. Trusted brokers won't disappear but there's a big difference between being the only game in town and filling a niche in an ecosystem. Technology makes social solutions irrelevant all the time. How many interactions intermediated by people no longer exist because they are now intermediated by software and platforms?

arcticbull 6y ago
We've had 11 years of innovation in blockchain technology and so far, nothing has improved on the status quo. 11 years ago was right around when the first iPhone came out, for reference. In my opinion, that's because you can't solve trust with magic pixie dust. No matter what, trust represents a huge optimization. That means anything you try and do to reduce trust will introduce massive quantities of friction. Trust is good and should be embraced. If something better comes along, great, but I've seen no evidence in the last 11 years that would indicate anything's at risk of coming down the pike. I've got no interest in championing a technology that hasn't budged a single iota (heh) in 11 years. If it does, I'll eat my... well. You get the joke. [edit] note that market cap doesn't mean anything for a currency. There's no market cap of US dollars, because dollars have a fixed value relative to dollars. If I exchange my dollar for a dollar, the market cap of dollars is equal to the number of dollars in circulation. End of story. You value other things relative to currency to obtain their market cap. The market cap of BTC is 21MM BTC. Less, given the huge quantities that go missing all the time.
- cma 6y ago
  Proof of stake vs proof of work?
ChrisLomont 6y ago
> These things are true at present but are they true in the limit? In the limit no more BTC can be obtained by mining, so transactions will be more expensive, because the computational cost will have to paid for by the transactor. And the computation required will be much larger than now, requiring more energy, and, given the end of Moore’s law, will likely be vastly more expensive. It is doomed to fail.
- naveen99 6y ago
  It may be doomed to fail, but it might be useful until it’s failed by something better. And that may be a long time.
  - arcticbull 6y ago
    Right, but it isn't. We've yet to find a single use case better served by crypto than traditional means, in 11 years, that is legal.
  - ChrisLomont 6y ago
    It's useful at burning incredible amounts of energy doing essentially nothing useful. It currently uses about 0.25% of the world's electricity, which, for a market cap of ~100B, is an astounding waste. Global currency trading, at $6+T per day, at that scale, would use 15% of global world electricity usage, which is more than any country besides US and China.
    - arcticbull 6y ago
      Probably more, because it's designed to be actively anti-efficient. The more you try and use it the less efficient it gets. It might well require more than Earth's total power generation capacity to do so.
      - naveen99 6y ago
        Anti efficiency is a feature in other places as well: password complexity, safety procedures, memory safety, functional programming (immutability), checks and balances in government.
    - naveen99 6y ago
      Electricity is renewable. Waste is unused supply. there is more demand for bitcoin than supply. I usually agree with most of your analysis on economics, except on bitcoin. Hopefully you will come around on this topic as well.

arcticbull 6y ago

We've had 11 years of innovation in blockchain technology and so far, nothing has improved on the status quo. 11 years ago was right around when the first iPhone came out, for reference. In my opinion, that's because you can't solve trust with magic pixie dust. No matter what, trust represents a huge optimization. That means anything you try and do to reduce trust will introduce massive quantities of friction. Trust is good and should be embraced. If something better comes along, great, but I've seen no evidence in the last 11 years that would indicate anything's at risk of coming down the pike. I've got no interest in championing a technology that hasn't budged a single iota (heh) in 11 years. If it does, I'll eat my... well. You get the joke. [edit] note that market cap doesn't mean anything for a currency. There's no market cap of US dollars, because dollars have a fixed value relative to dollars. If I exchange my dollar for a dollar, the market cap of dollars is equal to the number of dollars in circulation. End of story. You value other things relative to currency to obtain their market cap. The market cap of BTC is 21MM BTC. Less, given the huge quantities that go missing all the time.

cma 6y ago
Proof of stake vs proof of work?

ChrisLomont 6y ago

> These things are true at present but are they true in the limit? In the limit no more BTC can be obtained by mining, so transactions will be more expensive, because the computational cost will have to paid for by the transactor. And the computation required will be much larger than now, requiring more energy, and, given the end of Moore’s law, will likely be vastly more expensive. It is doomed to fail.

naveen99 6y ago
It may be doomed to fail, but it might be useful until it’s failed by something better. And that may be a long time.
- arcticbull 6y ago
  Right, but it isn't. We've yet to find a single use case better served by crypto than traditional means, in 11 years, that is legal.
- ChrisLomont 6y ago
  It's useful at burning incredible amounts of energy doing essentially nothing useful. It currently uses about 0.25% of the world's electricity, which, for a market cap of ~100B, is an astounding waste. Global currency trading, at $6+T per day, at that scale, would use 15% of global world electricity usage, which is more than any country besides US and China.
  - arcticbull 6y ago
    Probably more, because it's designed to be actively anti-efficient. The more you try and use it the less efficient it gets. It might well require more than Earth's total power generation capacity to do so.
    - naveen99 6y ago
      Anti efficiency is a feature in other places as well: password complexity, safety procedures, memory safety, functional programming (immutability), checks and balances in government.
  - naveen99 6y ago
    Electricity is renewable. Waste is unused supply. there is more demand for bitcoin than supply. I usually agree with most of your analysis on economics, except on bitcoin. Hopefully you will come around on this topic as well.