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> does Visa offer distributed consensus and verifiable transactions with no central trusted authority? Ok, I’ll bite. No, it doesn’t, but what is that actuall

by csa 6y ago

> does Visa offer distributed consensus and verifiable transactions with no central trusted authority? Ok, I’ll bite. No, it doesn’t, but what is that actually useful for? The best answer I can come up with is illegal activities and libertarian fantasies. Even if one generously frames “illegal activities” in the context of financial freedom from a tyrannical regime, even that has limits. Any regime with a banking system can implement a KYC-type of policy that will can make interacting financially with anything related to BTC difficult or impossible. Need a modern example? Look no further than online wallets (e.g., Neteller) and online poker sites after the UIGEA. I will add that if any government views a digital coin as a threat to their fiat currency system, it will be trivially easy for them to make that currency an extremely inefficient store of value. The measures will be draconian towards coin holders, but most people (rightly or wrongly) won’t care.

PragmaticPulp 6y ago
> I will add that if any government views a digital coin as a threat to their fiat currency system This fear is greatly exaggerated by people who have bought into the false idea that Bitcoin is the only way to escape inflation. The definition of inflation is that asset prices go up. You can escape inflation by simply buying assets, or basically anything other than cash. If someone truly believed massive inflation was coming, they would want to take out USD-denominated mortgages and buy houses. Inflation would increase the value of the houses and reduce the value of your loan repayments. It's silly that so many people are afraid of the government devaluing their cash that they've decided the best way to escape it is to pile into an asset with an extremely lopsided distribution in favor of early adopters. The average person stands to gain more from recent stimulus than they stand to lose from inflation in their cash accounts. Doubly so if they invest their cash in stocks or assets, which doesn't even require Bitcoin.
- astrange 6y ago
  > The definition of inflation is that asset prices go up. The definition of inflation is typically that consumer prices go up due to there being "more money". The only kind of asset that people consume is housing, and even then they don't really - housing as an asset (purchase price) can be disconnected from its consumption price (rent). Besides that, you can't eat stocks so you don't get poorer when the price goes up. Assets can actually increase in price because of deflation. For instance, technology getting cheaper has made all the stockbrokers drop their transaction fees and add fractional shares, so now everyone can bid up the same stocks.
passwordreset 6y ago
> what is that actually useful for? Ownership. It's the difference between "I own 20 quatloos because the Bank of Endor says so" vs. "I own 20 quatloos". It supports actual ownership instead of representative or proxy ownership. In the same way that you can have $20 in the bank or $20 in your wallet. When it's in your wallet, it's actually yours and you own it. When it's in your bank account, then you don't actually own it, you must trust that your bank will do the right thing and give it back to you when you ask for it. That level of trust has been wavering for decades. Remember that Bitcoin was started as a rebellion against the "second bailout for banks".
- csa 6y ago
  I was hoping someone would give this answer. OK... so what exactly is "ownership"? A buddy of mine mined ~160 BTC (currently about USD $8.1m) back when it was fairly worthless. He left it on a hard drive on one of his many machines. BTC became worth something. He look for said machine and HD. Couldn't find it. That BTC is effectively gone forever. So... who owns it? There are a not small amount of stories like the one above for various levels of non-trivial amounts of money (tens of billions). https://www.nytimes.com/2021/01/13/business/tens-of-billions-worth-of-bitcoin-have-been-locked-by-people-who-forgot-their-key.html https://www.nytimes.com/2021/01/13/business/tens-of-billions... Situations like this point to a desire for many/most people to want some sort of custodianship so that they don't accidentally lose something that might be worth millions one day... or even hundreds or thousands one day. At that point, one is looking at banks and banking systems, so we're back at square one. If one is looking at an alternative to banks, we sometimes/often get stuff like Mt. Gox and Bitfinex -- a situation in which a group of people who want to be independent of the banking system learn the lessons of the value of the banking system the hard way. So I guess where I am at is that I appreciate a desire to rebel against banks -- they wield way too much power. That said, I don't think that it's particularly prudent (or maybe even possible) to throw the baby out with the bathwater on this matter. The banks definitely do some fairly nefarious stuff, but they also do a metric shitload of very pedestrian-but-useful stuff extremely well on a daily basis. Until a coin can replace that pedestrian-but-useful system with equal grace, I doubt that a coin will be able to replace our current system. Furthermore, somehow if it does, it will be because the current system integrates coins into the current system rather than coins usurping the current system. So again... what is distributed consensus and verifiable transactions with no central trusted authority actually useful for?

by csa 6y ago

PragmaticPulp 6y ago

> I will add that if any government views a digital coin as a threat to their fiat currency system This fear is greatly exaggerated by people who have bought into the false idea that Bitcoin is the only way to escape inflation. The definition of inflation is that asset prices go up. You can escape inflation by simply buying assets, or basically anything other than cash. If someone truly believed massive inflation was coming, they would want to take out USD-denominated mortgages and buy houses. Inflation would increase the value of the houses and reduce the value of your loan repayments. It's silly that so many people are afraid of the government devaluing their cash that they've decided the best way to escape it is to pile into an asset with an extremely lopsided distribution in favor of early adopters. The average person stands to gain more from recent stimulus than they stand to lose from inflation in their cash accounts. Doubly so if they invest their cash in stocks or assets, which doesn't even require Bitcoin.

astrange 6y ago
> The definition of inflation is that asset prices go up. The definition of inflation is typically that consumer prices go up due to there being "more money". The only kind of asset that people consume is housing, and even then they don't really - housing as an asset (purchase price) can be disconnected from its consumption price (rent). Besides that, you can't eat stocks so you don't get poorer when the price goes up. Assets can actually increase in price because of deflation. For instance, technology getting cheaper has made all the stockbrokers drop their transaction fees and add fractional shares, so now everyone can bid up the same stocks.

passwordreset 6y ago

> what is that actually useful for? Ownership. It's the difference between "I own 20 quatloos because the Bank of Endor says so" vs. "I own 20 quatloos". It supports actual ownership instead of representative or proxy ownership. In the same way that you can have $20 in the bank or $20 in your wallet. When it's in your wallet, it's actually yours and you own it. When it's in your bank account, then you don't actually own it, you must trust that your bank will do the right thing and give it back to you when you ask for it. That level of trust has been wavering for decades. Remember that Bitcoin was started as a rebellion against the "second bailout for banks".

csa 6y ago
I was hoping someone would give this answer. OK... so what exactly is "ownership"? A buddy of mine mined ~160 BTC (currently about USD $8.1m) back when it was fairly worthless. He left it on a hard drive on one of his many machines. BTC became worth something. He look for said machine and HD. Couldn't find it. That BTC is effectively gone forever. So... who owns it? There are a not small amount of stories like the one above for various levels of non-trivial amounts of money (tens of billions). https://www.nytimes.com/2021/01/13/business/tens-of-billions-worth-of-bitcoin-have-been-locked-by-people-who-forgot-their-key.html https://www.nytimes.com/2021/01/13/business/tens-of-billions... Situations like this point to a desire for many/most people to want some sort of custodianship so that they don't accidentally lose something that might be worth millions one day... or even hundreds or thousands one day. At that point, one is looking at banks and banking systems, so we're back at square one. If one is looking at an alternative to banks, we sometimes/often get stuff like Mt. Gox and Bitfinex -- a situation in which a group of people who want to be independent of the banking system learn the lessons of the value of the banking system the hard way. So I guess where I am at is that I appreciate a desire to rebel against banks -- they wield way too much power. That said, I don't think that it's particularly prudent (or maybe even possible) to throw the baby out with the bathwater on this matter. The banks definitely do some fairly nefarious stuff, but they also do a metric shitload of very pedestrian-but-useful stuff extremely well on a daily basis. Until a coin can replace that pedestrian-but-useful system with equal grace, I doubt that a coin will be able to replace our current system. Furthermore, somehow if it does, it will be because the current system integrates coins into the current system rather than coins usurping the current system. So again... what is distributed consensus and verifiable transactions with no central trusted authority actually useful for?