6 ms·

What problem did bitcoin solve?

by raziel2701 6y ago

anthropodie 6y ago
Did you read the article?
- raziel2701 6y ago
  Bitcoin solved the double-spending problem. A problem long ago solved by centralized banking at significantly lower energy costs. You speak of continuing to allow wasteful energy expenditures in analogy to going to the moon and building the LHC, but if we already know how to solve double-spending problem at lower energy costs, why should we allow bitcoin? So I ask in good faith, what problem did bitcoin solve that nothing else has?
  - georgesC 6y ago
    Bitcoin solved the double spending problem in a decentralized system. This has numerous consequences, among them the possibility of creating a currency that doesn't rely on a centralized authority, trust minimization, immutability, etc. To me this has the potential to automate many jobs.
    - hannasanarion 6y ago
      Not relying on a centralized authority, trust minimalization, and immutability are all bad things for a monetary system. The ability to dispute and undo transactions and track fraud is a crucial feature of banking systems that blockchain eliminates by design. Blockchain will not automate any jobs because it is technologically no different from a database. The fact that transactions are recorded digitally is not a new invention, banks have been doing that since the 60s.
      - georgesC 6y ago
        A blockchain is a database. But a regular database doesn't really minimize trust, that's the point of public blockchains. The need of not relying on a centralized entity or third parties in the digital space does exist.
        hannasanarion 6y ago
        Minimizing trust is not a good thing. I don't understand where this obsession with it comes from. EVERY transaction requires trust. I sell you a pair of shoes, you pay in bitcoin, oops! the box is actually full of cat poop, too bad, sucks to be you, you can't get your bitcoin back, shouldn't have trusted me. Trust in the transaction system is not a dangerous component of commerce. Sure, you can trust Paypal to do the transaction for you (and also get benefits like chargebacks, disputes, and ID verification in return, not to mention the sub-second transaction speed), and what happens if they betray that trust? Well that's what governments are for, the two-ton hammer of the law will make sure you get your money back. Not to mention, blockchain is the least trustworthy transaction system of the modern age. Over a billion dollars in crypto has been stolen out of people's accounts via exchange hacks and smart contract exploits in the last ten years. This has never happened to any US bank since the introduction of FDIC in 1933.
        georgesC 6y ago
        Trust minimization doesn't equal no trust. Also the trust that a currency works as intended and that a transaction goes through isn't the same kind of trust than trusting a vendor, which is why there will probably always be other systems in place for that particular issue. Some people are interested in that because their trust has been abused by a centralized authority. And we're not only talking about the transaction systems, but also about currency. All in all it's all about the choice and preferences of individuals.
        hannasanarion 6y ago
        When has the centralized authority, the banking system, ACH, Visa, Paypal, etc. ever "abused trust" by failing to record a transaction? And why is that very minimal trust in the ability of your money to get from one account to another worth risking all your money by putting it in an account with a single point of failure with no recourse in the event of a breach? In 88 years, no bank in the Untied States has ever lost a customer's money. To date, there are more bitcoin exchanges that have lost their users' money than there are that haven't.
  - boc 6y ago
    Bitcoin was a brilliant technical solution to a problem that was already solved centuries ago by legal institutions and contracts. The introduction of bitcoin has had basically zero real economic impact on the macro economy, which to me is the surest indicator that it's a dead end. When the internet and PCs became mainstream, the economy exploded over the next decade. When crypto was invented, the only wealth being created so far has been from people trading it back and forth with fiat, funding companies that turn that funding into crypto, etc. I'm happy to be proven wrong if someone has compelling evidence, but it's been years and I haven't been convinced.
aeternum 6y ago
It allows one to store a relatively liquid form of wealth using only one's mind
- PragmaticPulp 6y ago
  Which is not at all what the vast majority of Bitcoin users are using Bitcoin for.
  - aeternum 6y ago
    Lots of people use the internet to watch cat videos, does that diminish its utility?
openfuture 6y ago
The Byzantine generals problem.
tim333 6y ago
Distributed digital money.

What problem did bitcoin solve?

anthropodie 6y ago

Did you read the article?

raziel2701 6y ago
Bitcoin solved the double-spending problem. A problem long ago solved by centralized banking at significantly lower energy costs. You speak of continuing to allow wasteful energy expenditures in analogy to going to the moon and building the LHC, but if we already know how to solve double-spending problem at lower energy costs, why should we allow bitcoin? So I ask in good faith, what problem did bitcoin solve that nothing else has?
- georgesC 6y ago
  Bitcoin solved the double spending problem in a decentralized system. This has numerous consequences, among them the possibility of creating a currency that doesn't rely on a centralized authority, trust minimization, immutability, etc. To me this has the potential to automate many jobs.
  - hannasanarion 6y ago
    Not relying on a centralized authority, trust minimalization, and immutability are all bad things for a monetary system. The ability to dispute and undo transactions and track fraud is a crucial feature of banking systems that blockchain eliminates by design. Blockchain will not automate any jobs because it is technologically no different from a database. The fact that transactions are recorded digitally is not a new invention, banks have been doing that since the 60s.
    - georgesC 6y ago
      A blockchain is a database. But a regular database doesn't really minimize trust, that's the point of public blockchains. The need of not relying on a centralized entity or third parties in the digital space does exist.
      - hannasanarion 6y ago
        Minimizing trust is not a good thing. I don't understand where this obsession with it comes from. EVERY transaction requires trust. I sell you a pair of shoes, you pay in bitcoin, oops! the box is actually full of cat poop, too bad, sucks to be you, you can't get your bitcoin back, shouldn't have trusted me. Trust in the transaction system is not a dangerous component of commerce. Sure, you can trust Paypal to do the transaction for you (and also get benefits like chargebacks, disputes, and ID verification in return, not to mention the sub-second transaction speed), and what happens if they betray that trust? Well that's what governments are for, the two-ton hammer of the law will make sure you get your money back. Not to mention, blockchain is the least trustworthy transaction system of the modern age. Over a billion dollars in crypto has been stolen out of people's accounts via exchange hacks and smart contract exploits in the last ten years. This has never happened to any US bank since the introduction of FDIC in 1933.
        georgesC 6y ago
        Trust minimization doesn't equal no trust. Also the trust that a currency works as intended and that a transaction goes through isn't the same kind of trust than trusting a vendor, which is why there will probably always be other systems in place for that particular issue. Some people are interested in that because their trust has been abused by a centralized authority. And we're not only talking about the transaction systems, but also about currency. All in all it's all about the choice and preferences of individuals.
        hannasanarion 6y ago
        When has the centralized authority, the banking system, ACH, Visa, Paypal, etc. ever "abused trust" by failing to record a transaction? And why is that very minimal trust in the ability of your money to get from one account to another worth risking all your money by putting it in an account with a single point of failure with no recourse in the event of a breach? In 88 years, no bank in the Untied States has ever lost a customer's money. To date, there are more bitcoin exchanges that have lost their users' money than there are that haven't.
- boc 6y ago
  Bitcoin was a brilliant technical solution to a problem that was already solved centuries ago by legal institutions and contracts. The introduction of bitcoin has had basically zero real economic impact on the macro economy, which to me is the surest indicator that it's a dead end. When the internet and PCs became mainstream, the economy exploded over the next decade. When crypto was invented, the only wealth being created so far has been from people trading it back and forth with fiat, funding companies that turn that funding into crypto, etc. I'm happy to be proven wrong if someone has compelling evidence, but it's been years and I haven't been convinced.

aeternum 6y ago

It allows one to store a relatively liquid form of wealth using only one's mind

PragmaticPulp 6y ago
Which is not at all what the vast majority of Bitcoin users are using Bitcoin for.
- aeternum 6y ago
  Lots of people use the internet to watch cat videos, does that diminish its utility?

openfuture 6y ago

The Byzantine generals problem.

tim333 6y ago

Distributed digital money.