52 ms·

Coordination, Good and Bad

126 points by dayve 6y ago

sova 6y ago
I never thought of "unstable games" before and that is quite revelatory when thinking about money, but I do wonder about cooperation because maybe not in Ethereum-land is there much joint minting of money, but there are subtle systems forces in place in the physical world that do mint money cooperatively and that might skew some of these perfect mathematical results, for example.
seibelj 6y ago
Vitalik is the creator of Ethereum. Ethereum is a platform for permission-less, programmable money and code that moves money and digital assets. Over $100 billion in assets are now operating on Ethereum. Here is a link to an explorer for USDC, a digital asset that is backed by dollars that has about $2 billion custodied by Coinbase and Circle https://etherscan.io/token/0xa0b86991c6218b36c1d19d4a2e9eb0ce3606eb48 https://etherscan.io/token/0xa0b86991c6218b36c1d19d4a2e9eb0c... I guarantee you that nearly every digital asset breaks numerous laws in every developed country. Bitcoin and Ethereum help violate money laundering laws every hour as many $10k+ transactions execute without proper forms filed with government agencies. Whereas it takes a shitload of money to obtain money transmitter licenses in the USA to operate in every state, it’s trivial to accept huge amounts of money across state and international borders once you create a cryptocurrency wallet. I’m saying this because the technology has surpassed the laws. As Uber and Airbnb became so successful that governments bent, so too is cryptocurrency powered by blockchain technology forcing the government’s hands. A paradigm shift is occurring under everyone’s noses! If you choose to ignore blockchain, don’t be surprised when it becomes a very crucial technology. It is upending centuries of financial customs, rules, laws, and institutions.
- kovek 6y ago
  I wonder if/when the government will make it cryptocurrencies more accessible and easier to use alongside “real” currencies.
  - seibelj 6y ago
    China has been testing a central bank digital currency (CBDC, google the term!) which has spooked many central banks in western countries. I work in this space and the attitude from government has been a 180 since China’s announcements. It’s hilarious to me that a year ago the SEC was obsessed with cracking down and now they are playing footsie with a three-year safe harbor! https://cointelegraph.com/news/sec-commissioner-cryptomom-explains-planned-safe-harbor-to-cointelegraph https://cointelegraph.com/news/sec-commissioner-cryptomom-ex...
  - grey-area 6y ago
    When they do, it will be government controlled and come with those pesky things like taxes, inflation, tracking etc that people celebrate cryptocurrencies for avoiding.
- XMPPwocky 6y ago
  "A very crucial technology" to whom? For what purpose?
  - seibelj 6y ago
    To build a financial system completely separate from the state. To avoid fiat currency, if you desire. To conduct commerce without government interference whatsoever. This is not a pipe dream. This happens every day in increasing numbers. I’m sorry if you don’t like this.
    - CharlesW 6y ago
      > This happens every day in increasing numbers. Nope. Bitcoin trading volume (for example) has plummeted to a miniscule fraction of its late-2016 hype height.
      - seibelj 6y ago
        It doesn’t seem you are familiar with this space, given that Ethereum transaction gas fees have hit sustained all time highs. Bitcoin and Monero transaction counts are extremely high despite the price of the assets being well beneath their height, signaling organic adoption and utility beyond speculation. It’s difficult for people outside of this space to see, as you only notice when news hits the front page. I work at a major crypto exchange (Poloniex) and all of our metrics are very bullish. I don’t think your 2017 opinion is relevant anymore.
        roland-s 6y ago
        Does high tx count and low price really mean utility? Seems it could also mean market is unsure of the asset's intrinsic worth and speculations are constantly in flux. Or could mean lots of speculative alts being built on top of main chain, things like Omni?
      - jonnydubowsky 6y ago
        Bitcoin sees highest trading volume in 118 days’ Yesterday’s volume of $54,406,443,211 was the highest in one hundred and eighteen days, 138 percent above last year’s average, and 26 percent below last year’s high. That means that yesterday, the Bitcoin network shifted the equivalent of 871 tons of gold. https://thenextweb.com/hardfork/2020/09/11/satoshi-nakaboto-bitcoin-sees-highest-trading-volume-in-118-days/ https://thenextweb.com/hardfork/2020/09/11/satoshi-nakaboto-...
- cblconfederate 6y ago
  Crypto directly undermines the concept of national currencies (the real US product is the dollar, right?). Crypto would enable people to literally 'vote with their wallet' by exiting from a currency they don't like into another. National currencies are defended with weapons, so until someone uses crypto to buy nuclear weapons, governments will forever undermine and neutralize crypto.
  - seibelj 6y ago
    You are immediately going from 0 to 100. A new currency begins with marginal uses and then expands. Give it some time before bitcoin buys nuclear weapons!
    - freddie_mercury 6y ago
      That's actually the opposite of how real world currencies work. They do not start with marginal cases and expand. In almost all cases they start with the most important cases -- the government says "you must pay taxes in currency X or suffer consequences". This is pretty well established in the history of currencies.
      - seibelj 6y ago
        Crypto is an emergent currency voluntarily used by a global group of people. It is nothing like government-backed fiat currency.
- grey-area 6y ago
  it’s trivial to accept huge amounts of money across state and international borders once you create a cryptocurrency wallet. Still illegal in all jurisdictions though, and at any point in the future people with guns may come to seize your assets based on the very complete and pseudo-anonymous list of transactions, because creating money and taxing transactions is a right that governments jealously guard and will not easily give up. I find currencies-as-code fascinating partly because of this strange mix of utopian thought and sincere attempts to overthrow global systems of governance (many of which are corrupt and self-serving) with code. People have been proclaiming they would upend the financial system and governments since 2008, but overthrowing systems of government requires physical acts of defiance and real loss, not just switching currency. I disagree that cryptocurrencies are currently disrupting centuries of customs, simply because most transactions on them are fake and volume/value is far lower than claimed[0], but also because if they do become popular enough to matter for real transactions (not speculation on price), states can easily impose regulation, audits and taxes on them by taking them over and changing the rules. Developers or exchanges would easily be suborned for example, since the code makes the rules and the majority wins, the rules can be changed. There are also good reasons that state currencies require auditing, rollback, identity verification and trusted third parties overseeing transactions - because without those you end up with a wild-west where bad actors can steal your money with impunity. For these reasons cryptocurrencies in their current form will never be very attractive to most people or corporations. 0: https://www.forbes.com/sites/jeffkauflin/2019/07/02/the-anatomy-of-a-fake-cryptocurrency-trade-how-exchanges-create-phony-transactions/#31cabac63132 https://www.forbes.com/sites/jeffkauflin/2019/07/02/the-anat...
  - sillysaurusx 6y ago
    Monero is anonymous, though, and any real transaction would probably be done in such an anonymous currency. Obviously, ospec can still blow your cover. But Monero and other assets are certainly a game changer in this space. The recent $4.5M ransom was evidence that this isn't really theoretical: https://www.reuters.com/article/idUSKCN24W25W https://www.reuters.com/article/idUSKCN24W25W (Bitcoin can be converted to Monero, and the bitcoin can be mixed, so it's still quite hard to do what you're suggesting: to track down the perpetrators of large-scale crimes such as this. The flipside is that criminals' opsec tends to be very poor; good police work is usually enough to capture them.)
- didibus 6y ago
  > I guarantee you that nearly every digital asset breaks numerous laws in every developed country Do you mean that Ethereum in fact has allowed collusion to happen within the greater context of the world more easily and at larger scales ? Such as by enabling groups of criminals around the world to collude together against the rest of us? Not sure if that's what you were saying, but in any case, I find this an interesting thought when contrasted with the message of the article.
  - seibelj 6y ago
    If you transfer over $10k USD from one bank to another, or in any financial transaction, you are obligated to trigger an array of forms and the institutions must take actions to tell the government of your activity. In crypto, not taking similar actions won’t cause any issue because the government can’t revoke your “crypto license” that doesn’t exist. Good luck!
    - didibus 6y ago
      Hum, I guess you make me realize a lot of gaps in my understanding of existing financial markets. For example, what prevents a bank from transferring money to each other without declaring it? Or for accepting a deposit that they don't report on? And similar withdrawals? Similarly, why isn't a crypto exchange obligated to do the same?
      - seibelj 6y ago
        The government will revoke their license and file charges against the executives / fiduciaries for violating their laws. Exchanges operate under the laws of the countries they are based in, many of which are offshore (Cayman, Seychelles, etc.) which have less strict rules than US / EU / UK exchanges. Of course you lose legal protections as a customer, but the free market has not been valuing those protections as much as statists would want you to believe their value is.
        didibus 6y ago
- friendlybus 6y ago
  An MIT lecture on Blockchain describes some government and financial institutions teating out blockchain for themselves. It's not clear if private coins will be left to operate after the institutions have their own.
- wslh 6y ago
  > If you choose to ignore blockchain, don’t be surprised when it becomes a very crucial technology. It is upending centuries of financial customs, rules, laws, and institutions. I think you are forgetting to talk about the other part of the glass where there is a ton of illegal money flowing in the financial system by people with enough power and/or financial complexity and current rules apply mainly to average Joe, and terrorists. Don't forget that the compliance system changed dramatically since 9/11 and not in the last centuries.
- mindslight 6y ago
  > It is upending centuries of financial customs, rules, laws, and institutions. More like decades. On a historical timeline, electronic bank accounts and the ensuing financial surveillance and financial censorship laws are themselves recent developments.
  - seibelj 6y ago
    Fair point, but the peer to peer nature of crypto and the complexity that can be developed without any institutional support is brand new. The power given to the individual is immense.
- anyonecancode 6y ago
  > Whereas it takes a shitload of money to obtain money transmitter licenses in the USA to operate in every state, it’s trivial to accept huge amounts of money across state and international borders once you create a cryptocurrency wallet. There's an implication here I think gets missed when discussing the political implications of cryptocurrency (as opposed to just the technology part). People spend a lot of time arguing over whether cryptocurrencies can truly keep free of states, but that has the implicit argument that this would make for more a more just or free system, and I don't think this is a well-grounded assumption. Who benefits from crypto? To the portion I quoted, people who want to move large amounts of money. But if you already have large amounts of money, you're already in a position of a fair amount of privilege and power. If you're someone who does NOT have a large amount of money, crypto isn't going to usher in a world where wealth is more evenly distributed. It's just as likely to do the opposite. Now those who already have a lot can save on the hassle and expense of having to actually lobby and corrupt state institutions, keeping more of their wealth with no gain for the rest of us. There's plenty of legitimate criticism to be made of the failures of the state to truly defend and advocat for the interests of all its citizens, but I'm very skeptical that a a technology that empowers people with lots of wealth to move it around with less friction is really a net gain for humanity.
singron 6y ago
> there are mathematical proofs that at least one stable Nash equilibrium must exist in any game That's actually not true. E.g. the game "you get the amount of money you ask for" has no equilibrium because you can always ask for a larger number. The proof on wikipedia doesn't apply to this game because the strategy space isn't compact. In real life, this doesn't come up much because usually your strategy is bounded somehow (e.g. you are limited by available cash+credit). I'm not as familiar with the other conditions listed and how they might relate to game strategies, but it would be interesting to hear an example game for each.
- tomrod 6y ago
  Does your example classify as a game? Who are you playing against? Usually nature isn't consider a "player" per say, but rather just defines an environment. Otherwise, a game consists of three structures[0]: • a collection of participants, or players. • Each player has a set of choices, or strategies, for how to play/behave. • Combined behavior results in payoffs (satisfaction level) for each player Macroeconomic theory handwaves and says assets are generally bounded above by some non-binding constraint to rule out this behavior you've pointed out, for the record. [0] Lazy google search result scribbed liberally from https://www.cs.cmu.edu/~avrim/598/lect0504GameTheory.pdf https://www.cs.cmu.edu/~avrim/598/lect0504GameTheory.pdf
lima-delta 6y ago
I am a bit tired of his V’s news getting posted on reddit. His thoughts on economic related stuff are almost naive footnotes of more general theorems.
- lftherios 6y ago
  It seems that many established economists disagree with you. One example: https://marginalrevolution.com/marginalrevolution/2018/07/conversation-vitalik-buterin.html https://marginalrevolution.com/marginalrevolution/2018/07/co...
  - lima-delta 6y ago
    Re Malaka, ti les. If u call this nut bloghead well established economist, tells me the rest of who u r.
    - tasuki 6y ago
      Are you saying Tyler Cowen isn't an established economist?
      - lima-delta 6y ago
        Lol. Ask urself while farming sushi on sushiswap
    - fsewe20 6y ago
      How about his work with Glen Weyl? (teaches economics at Princeton, they wrote a paper together on quadratic funding)
      - lima-delta 6y ago
        Another hypocrite almost like Robert reich, if u care to investigate his arguments.
webmaven 6y ago
Hmm. In the context of cryptocurrencies, I wonder what incentivizing defection would look like? eg. if several entities are colluding on a 51% attack, what mechanism would benefit a defector controlling 20% while screwing over the other colluding 31%, thus warning the non-colluding 49% of the collusion?
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mudlus 6y ago
Still tons of misunderstanding in this space. The financial system is supposed to have regulations that protect everyone in an economy. But, what they've ended up doing over the years is only applying to small players and retail (everyday) investors. Trump and his friends front ran the market crash. Then, after a records stimulus was passed, profited as over 200k US citizens died. That's just America (though America is the defacto reserve currency since WW2). They don't get punished, and they are just the _obvious_ cheaters in the game of international finance and crony capitalism. The USD is also the de-facto currency for: child pornographers, international hits and murder contracts, paying for military grade weapons, enforcing sanctions on entire economies, drugs, money laundering, literally everything--because it is _the_ reserve currency. Enforcement is for the people at the bottom, not the top. Ethereum can't change that, it's just offering the same financial services that crony capitalism offered but with a MORE oligarchical rules set. That's why it's funny his "ideal" and "realistic" pictures for success in cooperation both have pictures of castles. Bitcoin is anarchist money (for now) because it uses entropy to secure instead of force/violence (all fiat currency requires a military to secure). It questions the some of the base authorial structure of all human society/nation-state economics. It is built with disorder in mind. It has built in distrust of authority. Authority is(or requires) force (to enforce). It's important to question authority--that's the only way to progress, no power/responsibility/trust should be given indefinitely. With that in mind. Ethereum is a new form of authority, just like Bitcoin. But, it does some different stuff with the responsibility that is bestowed upon it. Ethereum owners (people who design, say, "smart contracts," or whatever), have already abused their power, this makes it more dangerous than Bitcoin. Recent SushiSwap stuff. Eth classic is constantly getting 51% attacked. There has been rollbacks. The devs change the inflation rate at will. They are constantly trying to move at a breakneck speed, so it's scary for people who want to hold money long term because you never know what you're gonna have to adapt to, or whatever. It is designed to play with new trust models, it's totally different than Bitcoin. Could be fun, but is designed to be more of a wild west than Bitcoin. If anything it's really better to see it as another layer to Bitcoin. If it surpasses Bitcoin in value, something will surpass it. If Bitcoin fails, it will likely fail since it is tied to the Bitcoin economy (wrapped Bitcoin, code similarities and cryptography standards used). If you're interested in Ethereum, there's already a better Ethereum, it's called TRON. And what about Polkadot. etc etc. If you're interested in going down this rabbit hole. Start with tech deflation. IMO, On a macro level we're seeing the same thing that happened after the industrial revolution, leading up to WW1 (though historians still argue about the cause of WW1--I think it's clear they'd have a lot to argue about if we had a WW3 soon, as well). It's called tech deflation. Of course, I'm not a historian or an economist. SO TAKE THIS ENTIRE DIATRIBE WITH A GRAIN OF SALT. Deflation is political suicide because business money goes where there is promise of a strong consumer base and labor force. But inflation is also effectively gaslighting citizens of the inflating nation-state. That's why we see such disparity through asset bubbles and pops every decade. The problem isn't inflation, though, it's that there isn't another legal option for all people. Money is a good that is consumed like anything else. You can keep fiat AND your Amazon gift card AND have some Bitcoin. Accept deflation into your life. Bitcoin is an anti-inflationary anti-censorship (Ethereum is not) choice, it is the best option for an equally distributed access to deflation that humans have right now (better than gold, or whatever, anyway). Honestly, believe it's the best first step to preventing a third world war. Ignore Vitalik's grains of salt, ignore my grains of salt Buy Bitcoin
koonsolo 6y ago
> price for some product between $5 and $10; the differences within the range reflect difficult-to-see factors such as the seller's internal costs, their own willingness to work at different wages, supply-chain issues and the like. No! Why is it so difficult for people to understand that price is set by supply and demand? Cost has absolutely no influence on how much the customer is willing to pay.
- tuesdayrain 6y ago
  >Cost has absolutely no influence on how much the customer is willing to pay. Giffen goods are an example of where that isn't true. I have personally experienced it myself when I became more tempted to buy BTC as the price started rising.
  - koonsolo 6y ago
    It still has nothing to do with cost though. The only things influencing price is always the product and the consumer. How much it cost to make the product has nothing to do with that price, even for giffen goods.
    - tuesdayrain 6y ago
      You're right, I had an incorrect definition of "cost".
trevelyan 6y ago
Vitalik is spinning a false dichotomy. Saito (http://saito.io/arcade http://saito.io/arcade) has already solved the 51 percent attack. The mechanism used (using fee collection as work) eliminates the profitability of collusion while still rewarding cooperation.
zuhayeer 6y ago
Interestingly, in a somewhat related notion, I’ve been noticing that there’s been a recent push in society towards individuality (over collectivism). In the way people view right or wrong, many have started to believe in their own preferences as ideals. While it’s good to have differences, it’s interesting to see the downstream effects of an overcorrection for the self. For example, doctors are now being accused of immorally attacking someone for being obese (seen as a personality trait), when in reality they’re just trying to help patients be aware of their unhealthy habits so they can improve their condition. Because we tie how we view the world to our individuality, we also adopt our own flaws as part of our objective compass. And things get interesting when people with that same frame of mind run into each other.
cryptica 6y ago
I've always felt that 'moral barriers' were the main forces which have allowed capitalism to operate relatively smoothly in the past (at least in some countries). That's why I've always been against Milton Friedman's philosophy that each person should only be motivated by-self interest. In many ways, this philosophy is the reason why we ended up where we are today; with a deep and growing class divide fueled by colluding self-interests, moral depravity and hypocrisy. This is because self-interest and cooperation are not mutually exclusive; it's the opposite; they are mutually reliant. But cooperation born out of self-interest does not yield the same results as cooperation born out of altruism and a sense of moral justice or collective pride.
deleted 6y ago
[deleted]

126 points by dayve 6y ago

sova 6y ago

I never thought of "unstable games" before and that is quite revelatory when thinking about money, but I do wonder about cooperation because maybe not in Ethereum-land is there much joint minting of money, but there are subtle systems forces in place in the physical world that do mint money cooperatively and that might skew some of these perfect mathematical results, for example.

seibelj 6y ago

Vitalik is the creator of Ethereum. Ethereum is a platform for permission-less, programmable money and code that moves money and digital assets. Over $100 billion in assets are now operating on Ethereum. Here is a link to an explorer for USDC, a digital asset that is backed by dollars that has about $2 billion custodied by Coinbase and Circle https://etherscan.io/token/0xa0b86991c6218b36c1d19d4a2e9eb0ce3606eb48 https://etherscan.io/token/0xa0b86991c6218b36c1d19d4a2e9eb0c... I guarantee you that nearly every digital asset breaks numerous laws in every developed country. Bitcoin and Ethereum help violate money laundering laws every hour as many $10k+ transactions execute without proper forms filed with government agencies. Whereas it takes a shitload of money to obtain money transmitter licenses in the USA to operate in every state, it’s trivial to accept huge amounts of money across state and international borders once you create a cryptocurrency wallet. I’m saying this because the technology has surpassed the laws. As Uber and Airbnb became so successful that governments bent, so too is cryptocurrency powered by blockchain technology forcing the government’s hands. A paradigm shift is occurring under everyone’s noses! If you choose to ignore blockchain, don’t be surprised when it becomes a very crucial technology. It is upending centuries of financial customs, rules, laws, and institutions.

kovek 6y ago
I wonder if/when the government will make it cryptocurrencies more accessible and easier to use alongside “real” currencies.
- seibelj 6y ago
  China has been testing a central bank digital currency (CBDC, google the term!) which has spooked many central banks in western countries. I work in this space and the attitude from government has been a 180 since China’s announcements. It’s hilarious to me that a year ago the SEC was obsessed with cracking down and now they are playing footsie with a three-year safe harbor! https://cointelegraph.com/news/sec-commissioner-cryptomom-explains-planned-safe-harbor-to-cointelegraph https://cointelegraph.com/news/sec-commissioner-cryptomom-ex...
- grey-area 6y ago
  When they do, it will be government controlled and come with those pesky things like taxes, inflation, tracking etc that people celebrate cryptocurrencies for avoiding.
XMPPwocky 6y ago
"A very crucial technology" to whom? For what purpose?
- seibelj 6y ago
  To build a financial system completely separate from the state. To avoid fiat currency, if you desire. To conduct commerce without government interference whatsoever. This is not a pipe dream. This happens every day in increasing numbers. I’m sorry if you don’t like this.
  - CharlesW 6y ago
    > This happens every day in increasing numbers. Nope. Bitcoin trading volume (for example) has plummeted to a miniscule fraction of its late-2016 hype height.
    - seibelj 6y ago
      It doesn’t seem you are familiar with this space, given that Ethereum transaction gas fees have hit sustained all time highs. Bitcoin and Monero transaction counts are extremely high despite the price of the assets being well beneath their height, signaling organic adoption and utility beyond speculation. It’s difficult for people outside of this space to see, as you only notice when news hits the front page. I work at a major crypto exchange (Poloniex) and all of our metrics are very bullish. I don’t think your 2017 opinion is relevant anymore.
      - roland-s 6y ago
        Does high tx count and low price really mean utility? Seems it could also mean market is unsure of the asset's intrinsic worth and speculations are constantly in flux. Or could mean lots of speculative alts being built on top of main chain, things like Omni?
    - jonnydubowsky 6y ago
      Bitcoin sees highest trading volume in 118 days’ Yesterday’s volume of $54,406,443,211 was the highest in one hundred and eighteen days, 138 percent above last year’s average, and 26 percent below last year’s high. That means that yesterday, the Bitcoin network shifted the equivalent of 871 tons of gold. https://thenextweb.com/hardfork/2020/09/11/satoshi-nakaboto-bitcoin-sees-highest-trading-volume-in-118-days/ https://thenextweb.com/hardfork/2020/09/11/satoshi-nakaboto-...
cblconfederate 6y ago
Crypto directly undermines the concept of national currencies (the real US product is the dollar, right?). Crypto would enable people to literally 'vote with their wallet' by exiting from a currency they don't like into another. National currencies are defended with weapons, so until someone uses crypto to buy nuclear weapons, governments will forever undermine and neutralize crypto.
- seibelj 6y ago
  You are immediately going from 0 to 100. A new currency begins with marginal uses and then expands. Give it some time before bitcoin buys nuclear weapons!
  - freddie_mercury 6y ago
    That's actually the opposite of how real world currencies work. They do not start with marginal cases and expand. In almost all cases they start with the most important cases -- the government says "you must pay taxes in currency X or suffer consequences". This is pretty well established in the history of currencies.
    - seibelj 6y ago
      Crypto is an emergent currency voluntarily used by a global group of people. It is nothing like government-backed fiat currency.
grey-area 6y ago
it’s trivial to accept huge amounts of money across state and international borders once you create a cryptocurrency wallet. Still illegal in all jurisdictions though, and at any point in the future people with guns may come to seize your assets based on the very complete and pseudo-anonymous list of transactions, because creating money and taxing transactions is a right that governments jealously guard and will not easily give up. I find currencies-as-code fascinating partly because of this strange mix of utopian thought and sincere attempts to overthrow global systems of governance (many of which are corrupt and self-serving) with code. People have been proclaiming they would upend the financial system and governments since 2008, but overthrowing systems of government requires physical acts of defiance and real loss, not just switching currency. I disagree that cryptocurrencies are currently disrupting centuries of customs, simply because most transactions on them are fake and volume/value is far lower than claimed[0], but also because if they do become popular enough to matter for real transactions (not speculation on price), states can easily impose regulation, audits and taxes on them by taking them over and changing the rules. Developers or exchanges would easily be suborned for example, since the code makes the rules and the majority wins, the rules can be changed. There are also good reasons that state currencies require auditing, rollback, identity verification and trusted third parties overseeing transactions - because without those you end up with a wild-west where bad actors can steal your money with impunity. For these reasons cryptocurrencies in their current form will never be very attractive to most people or corporations. 0: https://www.forbes.com/sites/jeffkauflin/2019/07/02/the-anatomy-of-a-fake-cryptocurrency-trade-how-exchanges-create-phony-transactions/#31cabac63132 https://www.forbes.com/sites/jeffkauflin/2019/07/02/the-anat...
- sillysaurusx 6y ago
  Monero is anonymous, though, and any real transaction would probably be done in such an anonymous currency. Obviously, ospec can still blow your cover. But Monero and other assets are certainly a game changer in this space. The recent $4.5M ransom was evidence that this isn't really theoretical: https://www.reuters.com/article/idUSKCN24W25W https://www.reuters.com/article/idUSKCN24W25W (Bitcoin can be converted to Monero, and the bitcoin can be mixed, so it's still quite hard to do what you're suggesting: to track down the perpetrators of large-scale crimes such as this. The flipside is that criminals' opsec tends to be very poor; good police work is usually enough to capture them.)
didibus 6y ago
> I guarantee you that nearly every digital asset breaks numerous laws in every developed country Do you mean that Ethereum in fact has allowed collusion to happen within the greater context of the world more easily and at larger scales ? Such as by enabling groups of criminals around the world to collude together against the rest of us? Not sure if that's what you were saying, but in any case, I find this an interesting thought when contrasted with the message of the article.
- seibelj 6y ago
  If you transfer over $10k USD from one bank to another, or in any financial transaction, you are obligated to trigger an array of forms and the institutions must take actions to tell the government of your activity. In crypto, not taking similar actions won’t cause any issue because the government can’t revoke your “crypto license” that doesn’t exist. Good luck!
  - didibus 6y ago
    Hum, I guess you make me realize a lot of gaps in my understanding of existing financial markets. For example, what prevents a bank from transferring money to each other without declaring it? Or for accepting a deposit that they don't report on? And similar withdrawals? Similarly, why isn't a crypto exchange obligated to do the same?
    - seibelj 6y ago
      The government will revoke their license and file charges against the executives / fiduciaries for violating their laws. Exchanges operate under the laws of the countries they are based in, many of which are offshore (Cayman, Seychelles, etc.) which have less strict rules than US / EU / UK exchanges. Of course you lose legal protections as a customer, but the free market has not been valuing those protections as much as statists would want you to believe their value is.
      - didibus 6y ago
friendlybus 6y ago
An MIT lecture on Blockchain describes some government and financial institutions teating out blockchain for themselves. It's not clear if private coins will be left to operate after the institutions have their own.
wslh 6y ago
> If you choose to ignore blockchain, don’t be surprised when it becomes a very crucial technology. It is upending centuries of financial customs, rules, laws, and institutions. I think you are forgetting to talk about the other part of the glass where there is a ton of illegal money flowing in the financial system by people with enough power and/or financial complexity and current rules apply mainly to average Joe, and terrorists. Don't forget that the compliance system changed dramatically since 9/11 and not in the last centuries.
mindslight 6y ago
> It is upending centuries of financial customs, rules, laws, and institutions. More like decades. On a historical timeline, electronic bank accounts and the ensuing financial surveillance and financial censorship laws are themselves recent developments.
- seibelj 6y ago
  Fair point, but the peer to peer nature of crypto and the complexity that can be developed without any institutional support is brand new. The power given to the individual is immense.
anyonecancode 6y ago
> Whereas it takes a shitload of money to obtain money transmitter licenses in the USA to operate in every state, it’s trivial to accept huge amounts of money across state and international borders once you create a cryptocurrency wallet. There's an implication here I think gets missed when discussing the political implications of cryptocurrency (as opposed to just the technology part). People spend a lot of time arguing over whether cryptocurrencies can truly keep free of states, but that has the implicit argument that this would make for more a more just or free system, and I don't think this is a well-grounded assumption. Who benefits from crypto? To the portion I quoted, people who want to move large amounts of money. But if you already have large amounts of money, you're already in a position of a fair amount of privilege and power. If you're someone who does NOT have a large amount of money, crypto isn't going to usher in a world where wealth is more evenly distributed. It's just as likely to do the opposite. Now those who already have a lot can save on the hassle and expense of having to actually lobby and corrupt state institutions, keeping more of their wealth with no gain for the rest of us. There's plenty of legitimate criticism to be made of the failures of the state to truly defend and advocat for the interests of all its citizens, but I'm very skeptical that a a technology that empowers people with lots of wealth to move it around with less friction is really a net gain for humanity.

singron 6y ago

> there are mathematical proofs that at least one stable Nash equilibrium must exist in any game That's actually not true. E.g. the game "you get the amount of money you ask for" has no equilibrium because you can always ask for a larger number. The proof on wikipedia doesn't apply to this game because the strategy space isn't compact. In real life, this doesn't come up much because usually your strategy is bounded somehow (e.g. you are limited by available cash+credit). I'm not as familiar with the other conditions listed and how they might relate to game strategies, but it would be interesting to hear an example game for each.

tomrod 6y ago
Does your example classify as a game? Who are you playing against? Usually nature isn't consider a "player" per say, but rather just defines an environment. Otherwise, a game consists of three structures[0]: • a collection of participants, or players. • Each player has a set of choices, or strategies, for how to play/behave. • Combined behavior results in payoffs (satisfaction level) for each player Macroeconomic theory handwaves and says assets are generally bounded above by some non-binding constraint to rule out this behavior you've pointed out, for the record. [0] Lazy google search result scribbed liberally from https://www.cs.cmu.edu/~avrim/598/lect0504GameTheory.pdf https://www.cs.cmu.edu/~avrim/598/lect0504GameTheory.pdf

lima-delta 6y ago

I am a bit tired of his V’s news getting posted on reddit. His thoughts on economic related stuff are almost naive footnotes of more general theorems.

lftherios 6y ago
It seems that many established economists disagree with you. One example: https://marginalrevolution.com/marginalrevolution/2018/07/conversation-vitalik-buterin.html https://marginalrevolution.com/marginalrevolution/2018/07/co...
- lima-delta 6y ago
  Re Malaka, ti les. If u call this nut bloghead well established economist, tells me the rest of who u r.
  - tasuki 6y ago
    Are you saying Tyler Cowen isn't an established economist?
    - lima-delta 6y ago
      Lol. Ask urself while farming sushi on sushiswap
  - fsewe20 6y ago
    How about his work with Glen Weyl? (teaches economics at Princeton, they wrote a paper together on quadratic funding)
    - lima-delta 6y ago
      Another hypocrite almost like Robert reich, if u care to investigate his arguments.

webmaven 6y ago

Hmm. In the context of cryptocurrencies, I wonder what incentivizing defection would look like? eg. if several entities are colluding on a 51% attack, what mechanism would benefit a defector controlling 20% while screwing over the other colluding 31%, thus warning the non-colluding 49% of the collusion?

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hidihi8790 6y ago

mudlus 6y ago

Still tons of misunderstanding in this space. The financial system is supposed to have regulations that protect everyone in an economy. But, what they've ended up doing over the years is only applying to small players and retail (everyday) investors. Trump and his friends front ran the market crash. Then, after a records stimulus was passed, profited as over 200k US citizens died. That's just America (though America is the defacto reserve currency since WW2). They don't get punished, and they are just the _obvious_ cheaters in the game of international finance and crony capitalism. The USD is also the de-facto currency for: child pornographers, international hits and murder contracts, paying for military grade weapons, enforcing sanctions on entire economies, drugs, money laundering, literally everything--because it is _the_ reserve currency. Enforcement is for the people at the bottom, not the top. Ethereum can't change that, it's just offering the same financial services that crony capitalism offered but with a MORE oligarchical rules set. That's why it's funny his "ideal" and "realistic" pictures for success in cooperation both have pictures of castles. Bitcoin is anarchist money (for now) because it uses entropy to secure instead of force/violence (all fiat currency requires a military to secure). It questions the some of the base authorial structure of all human society/nation-state economics. It is built with disorder in mind. It has built in distrust of authority. Authority is(or requires) force (to enforce). It's important to question authority--that's the only way to progress, no power/responsibility/trust should be given indefinitely. With that in mind. Ethereum is a new form of authority, just like Bitcoin. But, it does some different stuff with the responsibility that is bestowed upon it. Ethereum owners (people who design, say, "smart contracts," or whatever), have already abused their power, this makes it more dangerous than Bitcoin. Recent SushiSwap stuff. Eth classic is constantly getting 51% attacked. There has been rollbacks. The devs change the inflation rate at will. They are constantly trying to move at a breakneck speed, so it's scary for people who want to hold money long term because you never know what you're gonna have to adapt to, or whatever. It is designed to play with new trust models, it's totally different than Bitcoin. Could be fun, but is designed to be more of a wild west than Bitcoin. If anything it's really better to see it as another layer to Bitcoin. If it surpasses Bitcoin in value, something will surpass it. If Bitcoin fails, it will likely fail since it is tied to the Bitcoin economy (wrapped Bitcoin, code similarities and cryptography standards used). If you're interested in Ethereum, there's already a better Ethereum, it's called TRON. And what about Polkadot. etc etc. If you're interested in going down this rabbit hole. Start with tech deflation. IMO, On a macro level we're seeing the same thing that happened after the industrial revolution, leading up to WW1 (though historians still argue about the cause of WW1--I think it's clear they'd have a lot to argue about if we had a WW3 soon, as well). It's called tech deflation. Of course, I'm not a historian or an economist. SO TAKE THIS ENTIRE DIATRIBE WITH A GRAIN OF SALT. Deflation is political suicide because business money goes where there is promise of a strong consumer base and labor force. But inflation is also effectively gaslighting citizens of the inflating nation-state. That's why we see such disparity through asset bubbles and pops every decade. The problem isn't inflation, though, it's that there isn't another legal option for all people. Money is a good that is consumed like anything else. You can keep fiat AND your Amazon gift card AND have some Bitcoin. Accept deflation into your life. Bitcoin is an anti-inflationary anti-censorship (Ethereum is not) choice, it is the best option for an equally distributed access to deflation that humans have right now (better than gold, or whatever, anyway). Honestly, believe it's the best first step to preventing a third world war. Ignore Vitalik's grains of salt, ignore my grains of salt Buy Bitcoin

koonsolo 6y ago

> price for some product between $5 and $10; the differences within the range reflect difficult-to-see factors such as the seller's internal costs, their own willingness to work at different wages, supply-chain issues and the like. No! Why is it so difficult for people to understand that price is set by supply and demand? Cost has absolutely no influence on how much the customer is willing to pay.

tuesdayrain 6y ago
>Cost has absolutely no influence on how much the customer is willing to pay. Giffen goods are an example of where that isn't true. I have personally experienced it myself when I became more tempted to buy BTC as the price started rising.
- koonsolo 6y ago
  It still has nothing to do with cost though. The only things influencing price is always the product and the consumer. How much it cost to make the product has nothing to do with that price, even for giffen goods.
  - tuesdayrain 6y ago
    You're right, I had an incorrect definition of "cost".

trevelyan 6y ago

Vitalik is spinning a false dichotomy. Saito (http://saito.io/arcade http://saito.io/arcade) has already solved the 51 percent attack. The mechanism used (using fee collection as work) eliminates the profitability of collusion while still rewarding cooperation.

zuhayeer 6y ago

Interestingly, in a somewhat related notion, I’ve been noticing that there’s been a recent push in society towards individuality (over collectivism). In the way people view right or wrong, many have started to believe in their own preferences as ideals. While it’s good to have differences, it’s interesting to see the downstream effects of an overcorrection for the self. For example, doctors are now being accused of immorally attacking someone for being obese (seen as a personality trait), when in reality they’re just trying to help patients be aware of their unhealthy habits so they can improve their condition. Because we tie how we view the world to our individuality, we also adopt our own flaws as part of our objective compass. And things get interesting when people with that same frame of mind run into each other.

cryptica 6y ago

I've always felt that 'moral barriers' were the main forces which have allowed capitalism to operate relatively smoothly in the past (at least in some countries). That's why I've always been against Milton Friedman's philosophy that each person should only be motivated by-self interest. In many ways, this philosophy is the reason why we ended up where we are today; with a deep and growing class divide fueled by colluding self-interests, moral depravity and hypocrisy. This is because self-interest and cooperation are not mutually exclusive; it's the opposite; they are mutually reliant. But cooperation born out of self-interest does not yield the same results as cooperation born out of altruism and a sense of moral justice or collective pride.

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