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I find crypto super interesting and have dipped my toes in with some small real money just to force myself to try out different products. That said, so far, al

I find crypto super interesting and have dipped my toes in with some small real money just to force myself to try out different products. That said, so far, almost 10 years in, there really are not a lot of real world use cases. Sure there are glorified POCs of things that could potentially lead in the direction of real world use cases. But most of these products/tokens are just extremely meta. Tokens you get paid/pay for when you trade/borrow/lend/invest/stake your other tokens. Derivative tokens which allow you to get exposure to underlying tokenX on chainY. The transactions are slow, or fast.. cheap or expensive, good luck understanding which in advance. It doesn't feel like we are any closer to normal people using it for normal real world transactions/finance. Right now it just feels like pump&dump/frontrunning/private placement games on each new token before it hits mainstream, completely nothing to do with what the alleged business behind that token is supposed to be doing or its prospects of success. It's just a game of getting hold of difficult to acquire tokens before they hit the more normie venues like Binance, Coinbase, etc.

borrowcheckfml 5y ago
I think of it like this. Various tokens give you certain types of exposures with different risk profiles. Yields are so high because of the risk. This really isn't so different from the centralized financial system where we have built complex structures (exotic derivatives, structured products, etc) to give you certain types of exposures. The difference is that DeFi is globally accessible and permissionless. Even if DeFi never moves beyond these "financial speculation" use cases, if it replaces what's currently centralized in government-regulated financial markets, that's a multi-trillion dollar opportunity. I'm doubtful we'll see any retail use cases or mass option beyond speculation soon, just like your average retail user does not buy exotic derivatives. That doesn't mean it's not useful.
- slg 5y ago
  Except those "exotic derivatives, structured products, etc" do have real investments at the heart of them. What is at the heart of those "DeFi" investments? It seems to mostly be criminal and criminal-like behavior (this includes transferring money in ways the local government doesn't approve of which can admittedly be great if the local government is oppressive).
  - borrowcheckfml 5y ago
    I think it's arguable what real investments are. How "real" is the stock price of Gamestop? Aren't most prices just driven by imaginary narratives? Investors rarely care about dividends. There are also DeFi projects that are based what you call "real investments" such as stablecoins, synthetic assets for stocks and commodities, etc. When the backing/staking mechanism for these works as intended, they are just as real as any derivatives on these assets in the traditional financial markets.
    - bob33212 5y ago
      True, a good chunk of trading and wall street in general is not doing anything real. But just like the dotcom bubble, the music stops eventually, and you don't want to be stuck holding worthless stocks or coins when that happens.
    - slg 5y ago
      Let's say Gamestop is shutdown tomorrow. There is real estate, there is IP, and there are physical products that could all be sold to recoup losses. There is intrinsic value there regardless of whether the current stock price has greatly exceeded those values. The overwhelming majority of cryptocurrency investments have no intrinsic value.
      - borrowcheckfml 5y ago
        And crypto projects that are derivatives on real world assets, like fiat currencies (stablecoins) or stocks (synthetic tokens), have equivalent backing. If the project were to dissolve, there would be assets backing that. Not suggesting this is the case here, but I keep seeing this worrisome trend where people are stuck in the Bitcoin and ICO world from 5 years ago and think nothing has changed and they don't really understand the technical details of how DeFi protocols work today. In the case where tokens are not backed by anything they are often governance tokens, which are kind of like startup equity. Startups without much IP or real estate are commonly valued at millions of dollars. This is no different in that anyone is a VC investing in e.g. future governance rights.
- dd36 5y ago
  But governments regulate because before regulation, it was a scammers paradise.
- lottin 5y ago
  DeFi can't do much financing at all since smart contracts can only replicate a small subset of financial products which aren't very useful to begin with. Even calling it "finance" is a bit of a stretch.
  - sanderjd 5y ago
    > smart contracts can only replicate a small subset of financial products Why?
    - lottin 5y ago
      One of the reasons is that many financial contracts have provisions to seize assets under certain circumstances. This is not possible with DeFi because DeFi is built around "unconfiscatable" digital assets.
      - sanderjd 5y ago
        I believe it is possible to write in provisions for some actor or set of actors to seize assets in a smart contract. This doesn't seem common either because of immaturity or just culture, but I don't think it is impossible.
        lottin 5y ago
        No, that's not it. An actor must be able to seize assets from another actor, under certain circumstances. That can't be done with smart contracts because of the security model of blockchains.
        sanderjd 5y ago
        It can if it is written into the contract. I suspect pretty much all contracts will have provisions for this in the future.
        5y ago
- ineedasername 5y ago
  I don't think you're wrong conceptually. But in practical terms: 1) the traditional options with varying risk profiles are mostly legitimate. The ratio of scam to authentic project is much higher in crypto. Or if not "scam", products where the creators (as pointed out in this article) might be perfectly happy if the product turned out to be successful, but mostly don't care because they make their money up front: reward with very little risk. Retail customers take all the risk. Traditional financial products align incentives better because if no one want is, no one is making transaction or management fees either. They're (mostly) only successful if customers are successful 2) Financial products based on crypto have no real-world assets backing them, making their prices much more volatile. If you're investing in traditional high risk product that ultimately relies on a real-world commodity like oil, you can make reasoned predictions on where oil demand might be headed. Your might make a high risk bet that oil prices are going to bottom out from their current peak due to decreased demand after the Summer and a minor resurgence in COVID as more and more people go back to work and then kids stop distance learning and mostly go back to school in the fall, etc. You might be wrong, but you can see an actual underlying asset with real-world utility to make better reasoned decisions. It is much harder to do that with crypto when a tweet by some high profile billionaire (Elon comes to mind) or rumors of regulatory scrutiny could send prices soaring or plummeting. This is very rare in traditional financial products. I also don't think crypto will ever ever ever replace government regulated markets. It may become part of them, but not replace. The government (at least in the US) is already regulating crypto. CTR's are already required, the SEC has stepped in pretty heavily to classify most crypto as securities, complete with the requirements that comes with that, etc. It can be decentralized but still regulated, and governments are simply not going to allow crypto to take away their ability to control their own monetary policy. Plenty of governments may wish to move on from the USD being the default world reserve currency, but that's because they want it to be something they have more control over. Crypto doesn't fill that role. All the US would have to do is regulate how every US bank works with crypto, and require that US banks only work with foreign banks that follow similar requirements. Any foreign bank wanting to do business even remotely related to the US-- which is nearly all of them, would have no choice but to follow. Or the US could regulate how businesses are able to accept crypto as a currency. Businesses don't operate in a decentralized abstraction layer: They operate in physical locations. It might be difficult to seize their crypto assets if they violate the law (though not impossible) but still very easy to seize & shutdown their physical assets, throw people in jail, etc. Sure, if crypto could somehow avoid all of that until it became the de facto medium of exchange, governments would have a much harder time doing this. But it's not like governments aren't aware of what's going on, and as I said the regulation has already begun.
wyck 5y ago
This opinion is really common, I used to have it but what changed my mind was realizing there are not really any "real world" use cases. I look at crypto as actual money, with the same definition: "money is a verifiable record that is generally accepted". Money in of itself does not have any "real world" use cases, money is money. Money facilitates economic velocity and growth in the same way crypto does, except crypto has the potential to be more efficient and secure. One of the key reasons money exists is "currency velocity", crypto improves upon this a lot. Banks make money with money, they don't make money with real use cases. Good crypto projects act like decentralized banks, nothing more. In other words ignore all the bullshit projects and look at the ones who are structured like banks, financial instruments, or risk management. Then the use cases of cypto become very clear.
- deleted 5y ago
  [deleted]
- akkartik 5y ago
  Examples?
- klodolph 5y ago
  > Banks make money with money, they don't make money with real use cases. Banks make money with money + effort. They provide loans and vet the recipients of those loans, because the banks are exposed to the risk of default (at least, ideally, obviously this failed in 2008). If you want a small business loan, then you typically have to have not only a good credit rating, but a business plan. Sounds like a real use case to me.
  - steveBK123 5y ago
    Exactly - banks make money with money, but it's the money that real people use in the real world for real goods & services!! Want to buy a house? (Mortgage) Want to spread out the cost of a large purchase (car/boat/appliance)? (Credit card, consumer loan) Want to borrow money to pay contractors for home improvements? (HELOC) Want to pay for a coffee with a payment that is accepted in seconds? (Credit/Debit card or you know.. paper money) Want to save excess income in an interest-bearing account? (Savings, Money markets, etc) Want to invest excess income in partial ownership of income producing businesses? (IPOs, stock market) If banks don't make money with real use cases, please close all your accounts and attempt to live a week or a month without any interaction with the banking system. The banking system matches borrowers and savers of different risk profiles & durations so that people can go about their lives in a more convenient fashion. Right now DeFi is replicating some aspects of this in a fraud-laced decentralized manner except with an alphabet soup of crypto "money" which you can't do anything with other than trade it for more/other crypto "money" or the dirty-word "fiat".
treis 5y ago
> there really are not a lot of real world use cases. It's effectively just one. To make illegal transactions. That's a long list of things: drugs, hiding wealth, evading currency controls, extortion, and so on. Otherwise, existing currency and transfer mechanisms are more or less available and convenient.
- danuker 5y ago
  > It's effectively just one. To make illegal transactions. Your perspective is limited. Check out my general intro [1] and other articles [2]. TL;DR: at least one legitimate use case is to keep up with inflation. [1] - https://danuker.go.ro/intro-to-cryptocurrencies.html https://danuker.go.ro/intro-to-cryptocurrencies.html [2] - https://danuker.go.ro/tag/cryptocurrencies.html https://danuker.go.ro/tag/cryptocurrencies.html
  - valuearb 5y ago
    Yet BTC is trailing inflation by over 30% the last month alone?
    - danuker 5y ago
      Admittedly, there is high volatility due to demand. But as more get-rich-quick people get bored of it, that should stabilize.
      - aww_dang 5y ago
        Speculative mania is also driven by cheap credit, low interest rates and easy money in the form of direct stimulus.
      - crispyambulance 5y ago
        > But as more get-rich-quick people get bored of it, that should stabilize. Why do you think that will happen? The "get-rich-quick, evade-taxes, and evade-scrutiny" thing is front and center of the whole intent of cryptocurrency. How long has it been going now, 10 years? How much longer? It would be nice to have a crypto-currency where real people can use it like real currency. However, to be able to do that would mean eliminating the danger that a mere typo or some unintended consequence of "code-as-law" would wipe someone out and give another an insane windfall-- all in a millisecond. I think the cryptocurrency can work, but it has to have sane and civilized features. These have to be designed-in from the beginning. Otherwise, it's just an endless libertarian circle jerk.
applepple 5y ago
The vast majority of top projects are essentially scams and the real projects are not in the rankings. Even promising projects seem to turn into scams once they get into the top 200 or so. It's as if some wealthy investors buy up a lot tokens from top projects and then threaten the founders to crash the price unless they stop development and start wasting time. I've worked in the blockchain industry for several years and I've seen founders who used to constantly make great decisions start making one terrible decisions after another - It feels like they switched from being productive to being counter-productive from one day to the next. It's as if they're getting paid to NOT innovate. I'm 100% sure that there is some manipulation going on but I can't figure out why (though I have some wild theories).
- cinntaile 5y ago
  Don't go and claim the vast majority of top projects are essentially scams, that's just spreading false information.
  - smt88 5y ago
    "Ponzi scheme" is a better way to put it.
  - applepple 5y ago
    Name any major project and I can tell you why it's a scam. Bitcoin: Uses the electricity of a country to process 2 transactions per second. Layer 2 solutions such as Lightning Network have some significant drawbacks which make them unpractical and vulnerable to multiple attacks. They've been trying and talking it up for years - No results. Ethereum: Doesn't scale. The entire ecosystem (including all ERC20 tokens) together cannot process more than 30 transactions per second. New ERC20 tokens have to pay the same HUGE (e.g. $20 per transaction) fees as the mainchain; all tokens slow each other down (compete for resources from each other and drive up each other's transaction fees). They said that sharding was essentially ready years ago but now they've basically canceled it (or 'put it on the backburner' as they like to call it) in favor of extremely complex and vulnerable layer-2 ZK-Rollups solutions which are completely unproven (we don't know what will happen when many projects start adopting rollups; expensive on-chain interactions still need to happen). Polkadot: They claim everywhere to have 'Parachains'. The reality is that this feature doesn't exist yet. The way it's designed is extremely complex and the scalability benefits are limited because there can only be a limited number of parachains. Also, one thing which almost all the projects have in common is that they're mostly targeted at developers... Yet as a developer, there is almost always a MASSIVE amount of friction involved in setting up and integrating the blockchains with other systems. For example, Ethereum requires minimum 300GB of disk space to run a node (you need to run a node to do any serious integration testing). Also, the Ethereum node doesn't even provide a basic search feature; you need to use CENTRALIZED third-party services in order to search the blockchain data (that's because the node writes to a file instead of a proper database)... OMG. I could go on and on and on. There is just so much money behind these projects that the entire community will constantly twist the facts and present a severely distorted view of reality. There is no limit to the amount of deception and self-deception when there is money involved.
asdev 5y ago
this was also the case with the internet. the world wide web was just an experiment for a long time. applications and their base layers take time to develop. can't rule it out yet. tokens and shitcoins as get rich quick schemes are detracting from the true innovation imo
- quickthrowman 5y ago
  > tokens and shitcoins as get rich quick schemes are detracting from the true innovation imo What are the true innovations in blockchain technology?
- notahacker 5y ago
  The World Wide Web was not "just an experiment for a long time". It was released outside CERN in 1991. By the mid 1990s we had a graphic version ordinary people used to browse content which (other than screen resolution) would be familiar today and mainstream corporate participation. After a decade we were past the first bubble and had Amazon and Google.
- mmcnl 5y ago
  Not true at all. It almost immediately took off and transformed economies within a decade. The same can't be said for crypto. Crypto is older than the internet was _after_ the dotcom bubble.
woah 5y ago
Unfortunately this comment, which has nothing to do with the article linked, has been voted to the top. HN seems to take every article having anything to do crypto as an opportunity to share their unrelated and repetitive opinions about how crypto is bad. Why not just flag the article instead to get it off the front page? That would at least be less boring.
- enraged_camel 5y ago
  I agree, but this doesn't happen with just crypto. Some people post meta commentary about a submission's topic — often without reading the article itself. Then, others who also don't want to read the article read that meta commentary instead, and upvote it. I don't know the root cause exactly, but it is a pretty annoying trend.
spoonjim 5y ago
One real world use case I’ve seen is in sending money to basketcase countries. For example I pay a woman in Venezuela with Bitcoin and Amazon gift cards for digital content because her government would get their hands on the money otherwise.
valec 5y ago
monero is the only one that's actually worth a damn as a...y'know, currency, except because it's inflationary nobody talks about it because it's harder to make a profit. it's actually private, has fast and cheap transactions and is pretty stable. only problem imo is that it's POW (and mined on the cpu which means it makes crypto mining malware more common)
otabdeveloper4 5y ago
> It doesn't feel like we are any closer to normal people using it for normal real world transactions/finance. Crypto was always just a way for nerds to legally get rich quick. (When before that opportunity was limited to various finance types.) Whether that's good or bad is up to you. (It's not like the various non-digital "financial instruments" we've had for a long time before crypto were doing much good for normal real world transactions.)

borrowcheckfml 5y ago

I think of it like this. Various tokens give you certain types of exposures with different risk profiles. Yields are so high because of the risk. This really isn't so different from the centralized financial system where we have built complex structures (exotic derivatives, structured products, etc) to give you certain types of exposures. The difference is that DeFi is globally accessible and permissionless. Even if DeFi never moves beyond these "financial speculation" use cases, if it replaces what's currently centralized in government-regulated financial markets, that's a multi-trillion dollar opportunity. I'm doubtful we'll see any retail use cases or mass option beyond speculation soon, just like your average retail user does not buy exotic derivatives. That doesn't mean it's not useful.

slg 5y ago
Except those "exotic derivatives, structured products, etc" do have real investments at the heart of them. What is at the heart of those "DeFi" investments? It seems to mostly be criminal and criminal-like behavior (this includes transferring money in ways the local government doesn't approve of which can admittedly be great if the local government is oppressive).
- borrowcheckfml 5y ago
  I think it's arguable what real investments are. How "real" is the stock price of Gamestop? Aren't most prices just driven by imaginary narratives? Investors rarely care about dividends. There are also DeFi projects that are based what you call "real investments" such as stablecoins, synthetic assets for stocks and commodities, etc. When the backing/staking mechanism for these works as intended, they are just as real as any derivatives on these assets in the traditional financial markets.
  - bob33212 5y ago
    True, a good chunk of trading and wall street in general is not doing anything real. But just like the dotcom bubble, the music stops eventually, and you don't want to be stuck holding worthless stocks or coins when that happens.
  - slg 5y ago
    Let's say Gamestop is shutdown tomorrow. There is real estate, there is IP, and there are physical products that could all be sold to recoup losses. There is intrinsic value there regardless of whether the current stock price has greatly exceeded those values. The overwhelming majority of cryptocurrency investments have no intrinsic value.
    - borrowcheckfml 5y ago
      And crypto projects that are derivatives on real world assets, like fiat currencies (stablecoins) or stocks (synthetic tokens), have equivalent backing. If the project were to dissolve, there would be assets backing that. Not suggesting this is the case here, but I keep seeing this worrisome trend where people are stuck in the Bitcoin and ICO world from 5 years ago and think nothing has changed and they don't really understand the technical details of how DeFi protocols work today. In the case where tokens are not backed by anything they are often governance tokens, which are kind of like startup equity. Startups without much IP or real estate are commonly valued at millions of dollars. This is no different in that anyone is a VC investing in e.g. future governance rights.
dd36 5y ago
But governments regulate because before regulation, it was a scammers paradise.
lottin 5y ago
DeFi can't do much financing at all since smart contracts can only replicate a small subset of financial products which aren't very useful to begin with. Even calling it "finance" is a bit of a stretch.
- sanderjd 5y ago
  > smart contracts can only replicate a small subset of financial products Why?
  - lottin 5y ago
    One of the reasons is that many financial contracts have provisions to seize assets under certain circumstances. This is not possible with DeFi because DeFi is built around "unconfiscatable" digital assets.
    - sanderjd 5y ago
      I believe it is possible to write in provisions for some actor or set of actors to seize assets in a smart contract. This doesn't seem common either because of immaturity or just culture, but I don't think it is impossible.
      - lottin 5y ago
        No, that's not it. An actor must be able to seize assets from another actor, under certain circumstances. That can't be done with smart contracts because of the security model of blockchains.
        sanderjd 5y ago
        It can if it is written into the contract. I suspect pretty much all contracts will have provisions for this in the future.
        5y ago
ineedasername 5y ago
I don't think you're wrong conceptually. But in practical terms: 1) the traditional options with varying risk profiles are mostly legitimate. The ratio of scam to authentic project is much higher in crypto. Or if not "scam", products where the creators (as pointed out in this article) might be perfectly happy if the product turned out to be successful, but mostly don't care because they make their money up front: reward with very little risk. Retail customers take all the risk. Traditional financial products align incentives better because if no one want is, no one is making transaction or management fees either. They're (mostly) only successful if customers are successful 2) Financial products based on crypto have no real-world assets backing them, making their prices much more volatile. If you're investing in traditional high risk product that ultimately relies on a real-world commodity like oil, you can make reasoned predictions on where oil demand might be headed. Your might make a high risk bet that oil prices are going to bottom out from their current peak due to decreased demand after the Summer and a minor resurgence in COVID as more and more people go back to work and then kids stop distance learning and mostly go back to school in the fall, etc. You might be wrong, but you can see an actual underlying asset with real-world utility to make better reasoned decisions. It is much harder to do that with crypto when a tweet by some high profile billionaire (Elon comes to mind) or rumors of regulatory scrutiny could send prices soaring or plummeting. This is very rare in traditional financial products. I also don't think crypto will ever ever ever replace government regulated markets. It may become part of them, but not replace. The government (at least in the US) is already regulating crypto. CTR's are already required, the SEC has stepped in pretty heavily to classify most crypto as securities, complete with the requirements that comes with that, etc. It can be decentralized but still regulated, and governments are simply not going to allow crypto to take away their ability to control their own monetary policy. Plenty of governments may wish to move on from the USD being the default world reserve currency, but that's because they want it to be something they have more control over. Crypto doesn't fill that role. All the US would have to do is regulate how every US bank works with crypto, and require that US banks only work with foreign banks that follow similar requirements. Any foreign bank wanting to do business even remotely related to the US-- which is nearly all of them, would have no choice but to follow. Or the US could regulate how businesses are able to accept crypto as a currency. Businesses don't operate in a decentralized abstraction layer: They operate in physical locations. It might be difficult to seize their crypto assets if they violate the law (though not impossible) but still very easy to seize & shutdown their physical assets, throw people in jail, etc. Sure, if crypto could somehow avoid all of that until it became the de facto medium of exchange, governments would have a much harder time doing this. But it's not like governments aren't aware of what's going on, and as I said the regulation has already begun.

wyck 5y ago

This opinion is really common, I used to have it but what changed my mind was realizing there are not really any "real world" use cases. I look at crypto as actual money, with the same definition: "money is a verifiable record that is generally accepted". Money in of itself does not have any "real world" use cases, money is money. Money facilitates economic velocity and growth in the same way crypto does, except crypto has the potential to be more efficient and secure. One of the key reasons money exists is "currency velocity", crypto improves upon this a lot. Banks make money with money, they don't make money with real use cases. Good crypto projects act like decentralized banks, nothing more. In other words ignore all the bullshit projects and look at the ones who are structured like banks, financial instruments, or risk management. Then the use cases of cypto become very clear.

deleted 5y ago
[deleted]
akkartik 5y ago
Examples?
klodolph 5y ago
> Banks make money with money, they don't make money with real use cases. Banks make money with money + effort. They provide loans and vet the recipients of those loans, because the banks are exposed to the risk of default (at least, ideally, obviously this failed in 2008). If you want a small business loan, then you typically have to have not only a good credit rating, but a business plan. Sounds like a real use case to me.
- steveBK123 5y ago
  Exactly - banks make money with money, but it's the money that real people use in the real world for real goods & services!! Want to buy a house? (Mortgage) Want to spread out the cost of a large purchase (car/boat/appliance)? (Credit card, consumer loan) Want to borrow money to pay contractors for home improvements? (HELOC) Want to pay for a coffee with a payment that is accepted in seconds? (Credit/Debit card or you know.. paper money) Want to save excess income in an interest-bearing account? (Savings, Money markets, etc) Want to invest excess income in partial ownership of income producing businesses? (IPOs, stock market) If banks don't make money with real use cases, please close all your accounts and attempt to live a week or a month without any interaction with the banking system. The banking system matches borrowers and savers of different risk profiles & durations so that people can go about their lives in a more convenient fashion. Right now DeFi is replicating some aspects of this in a fraud-laced decentralized manner except with an alphabet soup of crypto "money" which you can't do anything with other than trade it for more/other crypto "money" or the dirty-word "fiat".

treis 5y ago

> there really are not a lot of real world use cases. It's effectively just one. To make illegal transactions. That's a long list of things: drugs, hiding wealth, evading currency controls, extortion, and so on. Otherwise, existing currency and transfer mechanisms are more or less available and convenient.

danuker 5y ago
> It's effectively just one. To make illegal transactions. Your perspective is limited. Check out my general intro [1] and other articles [2]. TL;DR: at least one legitimate use case is to keep up with inflation. [1] - https://danuker.go.ro/intro-to-cryptocurrencies.html https://danuker.go.ro/intro-to-cryptocurrencies.html [2] - https://danuker.go.ro/tag/cryptocurrencies.html https://danuker.go.ro/tag/cryptocurrencies.html
- valuearb 5y ago
  Yet BTC is trailing inflation by over 30% the last month alone?
  - danuker 5y ago
    Admittedly, there is high volatility due to demand. But as more get-rich-quick people get bored of it, that should stabilize.
    - aww_dang 5y ago
      Speculative mania is also driven by cheap credit, low interest rates and easy money in the form of direct stimulus.
    - crispyambulance 5y ago
      > But as more get-rich-quick people get bored of it, that should stabilize. Why do you think that will happen? The "get-rich-quick, evade-taxes, and evade-scrutiny" thing is front and center of the whole intent of cryptocurrency. How long has it been going now, 10 years? How much longer? It would be nice to have a crypto-currency where real people can use it like real currency. However, to be able to do that would mean eliminating the danger that a mere typo or some unintended consequence of "code-as-law" would wipe someone out and give another an insane windfall-- all in a millisecond. I think the cryptocurrency can work, but it has to have sane and civilized features. These have to be designed-in from the beginning. Otherwise, it's just an endless libertarian circle jerk.

applepple 5y ago

The vast majority of top projects are essentially scams and the real projects are not in the rankings. Even promising projects seem to turn into scams once they get into the top 200 or so. It's as if some wealthy investors buy up a lot tokens from top projects and then threaten the founders to crash the price unless they stop development and start wasting time. I've worked in the blockchain industry for several years and I've seen founders who used to constantly make great decisions start making one terrible decisions after another - It feels like they switched from being productive to being counter-productive from one day to the next. It's as if they're getting paid to NOT innovate. I'm 100% sure that there is some manipulation going on but I can't figure out why (though I have some wild theories).

cinntaile 5y ago
Don't go and claim the vast majority of top projects are essentially scams, that's just spreading false information.
- smt88 5y ago
  "Ponzi scheme" is a better way to put it.
- applepple 5y ago
  Name any major project and I can tell you why it's a scam. Bitcoin: Uses the electricity of a country to process 2 transactions per second. Layer 2 solutions such as Lightning Network have some significant drawbacks which make them unpractical and vulnerable to multiple attacks. They've been trying and talking it up for years - No results. Ethereum: Doesn't scale. The entire ecosystem (including all ERC20 tokens) together cannot process more than 30 transactions per second. New ERC20 tokens have to pay the same HUGE (e.g. $20 per transaction) fees as the mainchain; all tokens slow each other down (compete for resources from each other and drive up each other's transaction fees). They said that sharding was essentially ready years ago but now they've basically canceled it (or 'put it on the backburner' as they like to call it) in favor of extremely complex and vulnerable layer-2 ZK-Rollups solutions which are completely unproven (we don't know what will happen when many projects start adopting rollups; expensive on-chain interactions still need to happen). Polkadot: They claim everywhere to have 'Parachains'. The reality is that this feature doesn't exist yet. The way it's designed is extremely complex and the scalability benefits are limited because there can only be a limited number of parachains. Also, one thing which almost all the projects have in common is that they're mostly targeted at developers... Yet as a developer, there is almost always a MASSIVE amount of friction involved in setting up and integrating the blockchains with other systems. For example, Ethereum requires minimum 300GB of disk space to run a node (you need to run a node to do any serious integration testing). Also, the Ethereum node doesn't even provide a basic search feature; you need to use CENTRALIZED third-party services in order to search the blockchain data (that's because the node writes to a file instead of a proper database)... OMG. I could go on and on and on. There is just so much money behind these projects that the entire community will constantly twist the facts and present a severely distorted view of reality. There is no limit to the amount of deception and self-deception when there is money involved.

asdev 5y ago

this was also the case with the internet. the world wide web was just an experiment for a long time. applications and their base layers take time to develop. can't rule it out yet. tokens and shitcoins as get rich quick schemes are detracting from the true innovation imo

quickthrowman 5y ago
> tokens and shitcoins as get rich quick schemes are detracting from the true innovation imo What are the true innovations in blockchain technology?
notahacker 5y ago
The World Wide Web was not "just an experiment for a long time". It was released outside CERN in 1991. By the mid 1990s we had a graphic version ordinary people used to browse content which (other than screen resolution) would be familiar today and mainstream corporate participation. After a decade we were past the first bubble and had Amazon and Google.
mmcnl 5y ago
Not true at all. It almost immediately took off and transformed economies within a decade. The same can't be said for crypto. Crypto is older than the internet was _after_ the dotcom bubble.

woah 5y ago

Unfortunately this comment, which has nothing to do with the article linked, has been voted to the top. HN seems to take every article having anything to do crypto as an opportunity to share their unrelated and repetitive opinions about how crypto is bad. Why not just flag the article instead to get it off the front page? That would at least be less boring.

enraged_camel 5y ago
I agree, but this doesn't happen with just crypto. Some people post meta commentary about a submission's topic — often without reading the article itself. Then, others who also don't want to read the article read that meta commentary instead, and upvote it. I don't know the root cause exactly, but it is a pretty annoying trend.

spoonjim 5y ago

One real world use case I’ve seen is in sending money to basketcase countries. For example I pay a woman in Venezuela with Bitcoin and Amazon gift cards for digital content because her government would get their hands on the money otherwise.

valec 5y ago

monero is the only one that's actually worth a damn as a...y'know, currency, except because it's inflationary nobody talks about it because it's harder to make a profit. it's actually private, has fast and cheap transactions and is pretty stable. only problem imo is that it's POW (and mined on the cpu which means it makes crypto mining malware more common)

otabdeveloper4 5y ago

> It doesn't feel like we are any closer to normal people using it for normal real world transactions/finance. Crypto was always just a way for nerds to legally get rich quick. (When before that opportunity was limited to various finance types.) Whether that's good or bad is up to you. (It's not like the various non-digital "financial instruments" we've had for a long time before crypto were doing much good for normal real world transactions.)