4 ms·

> it requires no trusted 3rd party Or, at least not the same 3rd parties. Instead, it requires trusting a much larger host of other 3rd parties, many of which

by 1e-9 5y ago

> it requires no trusted 3rd party Or, at least not the same 3rd parties. Instead, it requires trusting a much larger host of other 3rd parties, many of which are anonymous, and likely none of which will provide recourse if you lose your bitcoin due to their failure or malicious intent.[1] Bitcoin represents a shifting of trust; not an elimination of trust. That's not to say there is no value. It's just that there are significant risks involving trust that are overlooked by most holders. [1] https://www.schneier.com/blog/archives/2019/02/blockchain_and_.html https://www.schneier.com/blog/archives/2019/02/blockchain_an...

shawnz 5y ago
I wouldn't say those risks are overlooked by most holders, rather that risk profile is exactly the reason why anyone would want to use cryptocurrency to begin with. Perhaps some hype artists would claim otherwise, but they shouldn't be defining how you view the technology itself.
- ineedasername 5y ago
  Yes, I think it's important to distinguish between the technology & its current use case. The technology is promising (though in bitcoin, stagnant). The primary use case right now seems to be financial speculation. That would have to change in order for any crypto currency to really gain any sort of mainstream traction as an alternative to traditional cash or credit (banks).
rogueSkib 5y ago
I don't believe this is accurate. As trust is spread across the network to an increasing number of people running nodes, the trust assigned to any individual participant approaches zero. This can be observed in the resilience of the network, as it self-heals against any attacker or alternative fork from the consensus. Bitcoin has democratically ossified into a store-of-value with absolute scarcity, deterministic monetary policy, and a priority on decentralization. It's extremely unlikely that those attributes will be compromised.
- 1e-9 5y ago
  > As trust is spread across the network to an increasing number of people running nodes, the trust assigned to any individual participant approaches zero. If only we knew this was true. An increase in the number of people running nodes does not guarantee that the maximum trust assigned to any individual participant approaches zero. What is the size of the largest Bitcoin whale? What is the size of the largest Bitcoin cartel? How do you know that the share of the largest Bitcoin whale or cartel isn’t increasing? What prevents China from deciding to eliminate the Bitcoin threat to its control by taking over the Chinese miners and launching a 51% attack? Even if you are willing to believe that trust is well distributed across many independent entities, you still need to have greater trust in your own security and IT skills. When your wallet is hacked or you lose your credentials, there’s no number to call to recover your Bitcoin. Bitcoin still requires significant trust, which is often overlooked.
  - wyager 5y ago
    > What prevents China from deciding to eliminate the Bitcoin threat to its control by taking over the Chinese miners and launching a 51% attack? China isn’t stupid. If they 51% attacked Bitcoin (completely contrary to their self interest), everyone would switch to a different hash algorithm and now China has burned tens of billions of capital, hurt their reputation, and achieved nothing.
    - 1e-9 5y ago
      You trust China to not attack Bitcoin because you consider it against their self interest. China just launched its own digital currency.[1] “In order to protect our currency sovereignty and legal currency status, we have to plan ahead,” said Mu Changchun, who is shepherding the project at the People’s Bank of China. China isn’t the only major power that needs to monitor transactions and maintain control of its money supply. There are plenty of capable parties that could launch a 51% attack and they’re unlikely to take responsibility for it afterwards, so reputation is hardly a factor. The fact that another hash algorithm could be used later doesn’t matter. A government doesn’t stop defending its interests just because threats change. Certainly, there may never be a 51% attack, but it will not be surprising if it happens. [1] https://www.wsj.com/articles/china-creates-its-own-digital-currency-a-first-for-major-economy-11617634118 https://www.wsj.com/articles/china-creates-its-own-digital-c...
wyager 5y ago
You don’t have to trust a “host of third parties” - you merely have to predict that a majority of third parties will not economically sabotage themselves.

by 1e-9 5y ago

shawnz 5y ago

I wouldn't say those risks are overlooked by most holders, rather that risk profile is exactly the reason why anyone would want to use cryptocurrency to begin with. Perhaps some hype artists would claim otherwise, but they shouldn't be defining how you view the technology itself.

ineedasername 5y ago
Yes, I think it's important to distinguish between the technology & its current use case. The technology is promising (though in bitcoin, stagnant). The primary use case right now seems to be financial speculation. That would have to change in order for any crypto currency to really gain any sort of mainstream traction as an alternative to traditional cash or credit (banks).

rogueSkib 5y ago

I don't believe this is accurate. As trust is spread across the network to an increasing number of people running nodes, the trust assigned to any individual participant approaches zero. This can be observed in the resilience of the network, as it self-heals against any attacker or alternative fork from the consensus. Bitcoin has democratically ossified into a store-of-value with absolute scarcity, deterministic monetary policy, and a priority on decentralization. It's extremely unlikely that those attributes will be compromised.

1e-9 5y ago
> As trust is spread across the network to an increasing number of people running nodes, the trust assigned to any individual participant approaches zero. If only we knew this was true. An increase in the number of people running nodes does not guarantee that the maximum trust assigned to any individual participant approaches zero. What is the size of the largest Bitcoin whale? What is the size of the largest Bitcoin cartel? How do you know that the share of the largest Bitcoin whale or cartel isn’t increasing? What prevents China from deciding to eliminate the Bitcoin threat to its control by taking over the Chinese miners and launching a 51% attack? Even if you are willing to believe that trust is well distributed across many independent entities, you still need to have greater trust in your own security and IT skills. When your wallet is hacked or you lose your credentials, there’s no number to call to recover your Bitcoin. Bitcoin still requires significant trust, which is often overlooked.
- wyager 5y ago
  > What prevents China from deciding to eliminate the Bitcoin threat to its control by taking over the Chinese miners and launching a 51% attack? China isn’t stupid. If they 51% attacked Bitcoin (completely contrary to their self interest), everyone would switch to a different hash algorithm and now China has burned tens of billions of capital, hurt their reputation, and achieved nothing.
  - 1e-9 5y ago
    You trust China to not attack Bitcoin because you consider it against their self interest. China just launched its own digital currency.[1] “In order to protect our currency sovereignty and legal currency status, we have to plan ahead,” said Mu Changchun, who is shepherding the project at the People’s Bank of China. China isn’t the only major power that needs to monitor transactions and maintain control of its money supply. There are plenty of capable parties that could launch a 51% attack and they’re unlikely to take responsibility for it afterwards, so reputation is hardly a factor. The fact that another hash algorithm could be used later doesn’t matter. A government doesn’t stop defending its interests just because threats change. Certainly, there may never be a 51% attack, but it will not be surprising if it happens. [1] https://www.wsj.com/articles/china-creates-its-own-digital-currency-a-first-for-major-economy-11617634118 https://www.wsj.com/articles/china-creates-its-own-digital-c...

wyager 5y ago

You don’t have to trust a “host of third parties” - you merely have to predict that a majority of third parties will not economically sabotage themselves.