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> We believe that the next wave of computing innovation will be driven by crypto. We are radically optimistic about crypto’s potential to restore trust and enab

> We believe that the next wave of computing innovation will be driven by crypto. We are radically optimistic about crypto’s potential to restore trust and enable new kinds of governance where communities collectively make important decisions about how networks evolve, what behaviors are permitted, and how economic benefits are distributed. That’s why today we’re pleased to announce a new $2.2 billion fund to continue investing in crypto networks and the founders and teams building in this space. This represents the beginning of an exciting new chapter for the a16z crypto team. Can somehow explain to me exactly how crypto will do this without intermediaries? If there must be intermediaries then why do you need crypto? - How can crypto "restore trust"? - How can it enable "new kinds of governance" - unless "new" means Plutocracy? - How can any economic benefits be distributed when by definition cryptocurrency holders are accountable to no one (something like a redistribution of funds would eventually require either an intermediary in which all holders are beholden to, or voting, however in either case that's the exact scenario you're in if you hold fiat in a democratic country so I'm not really getting it).

epistasis 5y ago
> How can crypto "restore trust"? For people with very poor understandings of economics, and have drunk deep from the sacred texts of Zerohedge, that have been standing on a wooden box on the street corner for the past decade preaching about the evils of the coming wave of inflation, as the Fed struggles mightily to be able to even get inflation up to the 2% target, much less above it for any period of time, crypto is the savior to get us away from fiat money.
- JohnJamesRambo 5y ago
  Maybe I just shouldn’t read Hacker News anymore.
  - 71a54xd 5y ago
    We should all ask ourself this question more often ;)
  - epistasis 5y ago
    At a minimum, it's good to skip comments with a header that starts with "epistasis X minutes ago..." I would instead recommend something like this masterpiece from Yakov Feygin, The Delationary Bloc: https://phenomenalworld.org/analysis/deflation-inflation https://phenomenalworld.org/analysis/deflation-inflation
- testific8 5y ago
  Yes but so is any asset. Gold, property, etc.
- allyourhorses 5y ago
  ZH is largely critical of crypto
- beervirus 5y ago
  > the Fed struggles mightily to be able to even get inflation up to the 2% target, much less above it for any period of time Congress solved their problem I guess.
- dang 5y ago
  Please don't post in the bombastic flamewar style to HN. It just leads to predictable, shitty threads. https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html
  - epistasis 5y ago
    Thanks for the check, dang, it's part of what keeps this site on track.
ojr 5y ago
you need crypto because crypto even with intermediaries is different than traditional fiat with intermediaries
- endisneigh 5y ago
  how so?
  - ojr 5y ago
    crypto provides more privacy even though as you can see with some of the latest ransomware attacks where they retrieve the ransom back not completely private, pseudo-anonymous. The wallet privacy is why FinCEN is trying to introduce new rules around unhosted wallets. https://www.coindesk.com/fincens-wallet-rule-aimed-to-close-crypto-cash-reporting-gap-official-says https://www.coindesk.com/fincens-wallet-rule-aimed-to-close-...
leifg 5y ago
Whenever this question comes up in crypto/blockchain enthusiast circles there are usually two answers. - read this $blockchain_book - just wait, these things take time I have never once heard specifics that are even close to convincing
TimJRobinson 5y ago
> How can crypto "restore trust"? Finance is incredibly opaque with a lot of rent-seekers taking a cut of transactions, and firms doing semi-illegal things but realizing that the chance of them getting caught is slim and the fine is generally less than the profits they'll make. Decentralized Finance (DeFi) is almost completely transparent - all major smart contracts are open source and all transactions are made in public. Which gives people a lot more trust in the system as they can see what is going on. > How can it enable "new kinds of governance" - unless "new" means Plutocracy? Have a look at Decentralized Autonomous Organizations (DAO's). People hold tokens in the protocol, and then anyone can suggest changes as a Git Diff. The token holders vote on the change and if it's approved it gets merged into the protocol. Pretty cool democratic way to make changes to decentralized software without anyone getting special privileges. > How can any economic benefits be distributed when by definition cryptocurrency holders are accountable to no one? I assume they're talking about DeFi not caring about your nationality / sex / skin color / power. Everyone is on an equal participation playing field, and nobody is locked out from participating.
- endisneigh 5y ago
  > Finance is incredibly opaque with a lot of rent-seekers taking a cut of transactions, and firms doing semi-illegal things but realizing that the chance of them getting caught is slim and the fine is generally less than the profits they'll make. > Decentralized Finance (DeFi) is almost completely transparent - all major smart contracts are open source and all transactions are made in public. Which gives people a lot more trust in the system as they can see what is going on. You have yet to explain how crypto will prevent these semi-illegal things from occurring. Like you said "the fine is generally less than the profits they'll make." Also, cryptocurrencies are not inherently transparent, and said transparency can also be used for oppression. In any case, code is not perfect and smart contracts cannot override reality. I see little to be gained. Ultimately you either need existing government to uphold the true intent of a smart contract or subject laypeople to understand highly complicated smart contract code to know whether what they're getting into is legit. > Have a look at Decentralized Autonomous Organizations (DAO's). People hold tokens in the protocol, and then anyone can suggest changes as a Git Diff. The token holders vote on the change and if it's approved it gets merged into the protocol. Pretty cool democratic way to make changes to decentralized software without anyone getting special privileges. This is not democratic - you're describing a plutocracy. Is that what you want? > I assume they're talking about DeFi not caring about your nationality / sex / skin color / power. Everyone is on an equal participation playing field, and nobody is locked out from participating. This is not true, those who held crypto earlier will have more weight.
SkyMarshal 5y ago
> We believe that the next wave of computing innovation will be driven by crypto. There’s actually another less obvious interpretation of this, which is that the creation of cryptocurrencies is funding the development and deployment of new technologies, some of which may be useful beyond cryptocurrencies. There are a number of academic research labs that have been funded in part or in whole by cryptocurrencies, and which exist to pump out new cryptography, distributed systems architectures, etc. For example, zk-SNARKS got a huge boost in use by cryptocurrencies the past decade, and there’s been an explosion of derivatives and advancements funded by the cryptocurrency industry since. Beyond the hype and buzzwords, that’s at least one lasting and tangible benefit of this industry.
- 71a54xd 5y ago
  Except for the leveraged Binance futures "tokens" that basically didn't function properly and all tanked without any real legal repercussions for Binance[0]. Unfortunately all of the competent exchanges with assets similar to these (let's be honest here... only FTX) aren't available for use in the USA in their full capacity. [0] - https://www.theblockcrypto.com/post/49898/how-a-misleading-tweet-drove-binance-listed-matic-token-tank-by-70 https://www.theblockcrypto.com/post/49898/how-a-misleading-t...
  - SkyMarshal 5y ago
    Did you respond to the right post? I don't see how anything you wrote is relevant to my post. You're talking about trading, I was talking about R&D.
testific8 5y ago
Because (at least originially) the goal of cryptocurrencies were to combat the double spending problem, providing an alternative to fractional-reserve banking.
adventured 5y ago
They're planning to swap intermediaries, because in doing so the VCs can capture enormous value from the old guard. Meet the new boss, same as the old boss. Instead of Jamie Dimon, it'll just be the next Zuckerberg (and when you propose a contentious theory about an emergent pandemic, they'll merely censor your ability to pay your bills, buy things and feed your family). It's worth noting though, that just because there are intermediaries, that obviously doesn't mean they're all the same. It doesn't mean their attributes are the same. One intermediary can be superior (or worse) than another. All successful, large scale approaches to crypto will always require intermediaries. DeFi is a fantasy, identical to the fantasy of decentralized Internet services in general from the past 10-20 years (real DeFi will languish for exactly the same reasons; the reasons for which the evangelists never seem to understand, because their emotional buy-in clouds their judgment). Part of that script by A16Z is entirely fake of course. They're inserting rather comical wokeness into it (communities, collectively, economic redistribution, har har), because you have to do that with all corporate PR now. Their goal is merely to establish the next banking & finance kingpins and to mint as many billions of dollars as they can in the process.
- jl2718 5y ago
  Seriously, nobody would invest if that wasn’t 100% true.
71a54xd 5y ago
They're likely making vague references to "CBDC's" or Central Bank Digital Currencies[0]. Networks like Chia that focus on less power consumption will likely be used to facilitate these networks, there's already been significant ESG movement since any new developments will be mandated to have a limited environmental impact. [0] - https://www.investopedia.com/terms/c/central-bank-digital-currency-cbdc.asp https://www.investopedia.com/terms/c/central-bank-digital-cu...
dangerface 5y ago
> How can crypto "restore trust"? Crypto can be held and transacted in a secure and trust less way. I can store my $ in the bank which is secure but requires trust, or I can store my $ under my bed which I trust but isn't secure. > How can it enable "new kinds of governance" New crypto has introduced the idea of a governance token, if you hold one of these governance tokens it gives you a vote on the policies of the token. This is similar to how you have a vote in the building society if you hold funds at that building society, much more democratic than more traditional banks. > How can any economic benefits be distributed when by definition cryptocurrency holders are accountable to no one Holders are accountable to the economics of the token in the same way that the government is accountable to the economics of the country. If token holders do dumb stuff that devalues their token no one will buy it and their token will be worthless in the same was as a government just printing money makes the money worth less.

epistasis 5y ago

> How can crypto "restore trust"? For people with very poor understandings of economics, and have drunk deep from the sacred texts of Zerohedge, that have been standing on a wooden box on the street corner for the past decade preaching about the evils of the coming wave of inflation, as the Fed struggles mightily to be able to even get inflation up to the 2% target, much less above it for any period of time, crypto is the savior to get us away from fiat money.

JohnJamesRambo 5y ago
Maybe I just shouldn’t read Hacker News anymore.
- 71a54xd 5y ago
  We should all ask ourself this question more often ;)
- epistasis 5y ago
  At a minimum, it's good to skip comments with a header that starts with "epistasis X minutes ago..." I would instead recommend something like this masterpiece from Yakov Feygin, The Delationary Bloc: https://phenomenalworld.org/analysis/deflation-inflation https://phenomenalworld.org/analysis/deflation-inflation
testific8 5y ago
Yes but so is any asset. Gold, property, etc.
allyourhorses 5y ago
ZH is largely critical of crypto
beervirus 5y ago
> the Fed struggles mightily to be able to even get inflation up to the 2% target, much less above it for any period of time Congress solved their problem I guess.
dang 5y ago
Please don't post in the bombastic flamewar style to HN. It just leads to predictable, shitty threads. https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html
- epistasis 5y ago
  Thanks for the check, dang, it's part of what keeps this site on track.

ojr 5y ago

you need crypto because crypto even with intermediaries is different than traditional fiat with intermediaries

endisneigh 5y ago
how so?
- ojr 5y ago
  crypto provides more privacy even though as you can see with some of the latest ransomware attacks where they retrieve the ransom back not completely private, pseudo-anonymous. The wallet privacy is why FinCEN is trying to introduce new rules around unhosted wallets. https://www.coindesk.com/fincens-wallet-rule-aimed-to-close-crypto-cash-reporting-gap-official-says https://www.coindesk.com/fincens-wallet-rule-aimed-to-close-...

leifg 5y ago

Whenever this question comes up in crypto/blockchain enthusiast circles there are usually two answers. - read this $blockchain_book - just wait, these things take time I have never once heard specifics that are even close to convincing

TimJRobinson 5y ago

> How can crypto "restore trust"? Finance is incredibly opaque with a lot of rent-seekers taking a cut of transactions, and firms doing semi-illegal things but realizing that the chance of them getting caught is slim and the fine is generally less than the profits they'll make. Decentralized Finance (DeFi) is almost completely transparent - all major smart contracts are open source and all transactions are made in public. Which gives people a lot more trust in the system as they can see what is going on. > How can it enable "new kinds of governance" - unless "new" means Plutocracy? Have a look at Decentralized Autonomous Organizations (DAO's). People hold tokens in the protocol, and then anyone can suggest changes as a Git Diff. The token holders vote on the change and if it's approved it gets merged into the protocol. Pretty cool democratic way to make changes to decentralized software without anyone getting special privileges. > How can any economic benefits be distributed when by definition cryptocurrency holders are accountable to no one? I assume they're talking about DeFi not caring about your nationality / sex / skin color / power. Everyone is on an equal participation playing field, and nobody is locked out from participating.

endisneigh 5y ago
> Finance is incredibly opaque with a lot of rent-seekers taking a cut of transactions, and firms doing semi-illegal things but realizing that the chance of them getting caught is slim and the fine is generally less than the profits they'll make. > Decentralized Finance (DeFi) is almost completely transparent - all major smart contracts are open source and all transactions are made in public. Which gives people a lot more trust in the system as they can see what is going on. You have yet to explain how crypto will prevent these semi-illegal things from occurring. Like you said "the fine is generally less than the profits they'll make." Also, cryptocurrencies are not inherently transparent, and said transparency can also be used for oppression. In any case, code is not perfect and smart contracts cannot override reality. I see little to be gained. Ultimately you either need existing government to uphold the true intent of a smart contract or subject laypeople to understand highly complicated smart contract code to know whether what they're getting into is legit. > Have a look at Decentralized Autonomous Organizations (DAO's). People hold tokens in the protocol, and then anyone can suggest changes as a Git Diff. The token holders vote on the change and if it's approved it gets merged into the protocol. Pretty cool democratic way to make changes to decentralized software without anyone getting special privileges. This is not democratic - you're describing a plutocracy. Is that what you want? > I assume they're talking about DeFi not caring about your nationality / sex / skin color / power. Everyone is on an equal participation playing field, and nobody is locked out from participating. This is not true, those who held crypto earlier will have more weight.

SkyMarshal 5y ago

> We believe that the next wave of computing innovation will be driven by crypto. There’s actually another less obvious interpretation of this, which is that the creation of cryptocurrencies is funding the development and deployment of new technologies, some of which may be useful beyond cryptocurrencies. There are a number of academic research labs that have been funded in part or in whole by cryptocurrencies, and which exist to pump out new cryptography, distributed systems architectures, etc. For example, zk-SNARKS got a huge boost in use by cryptocurrencies the past decade, and there’s been an explosion of derivatives and advancements funded by the cryptocurrency industry since. Beyond the hype and buzzwords, that’s at least one lasting and tangible benefit of this industry.

71a54xd 5y ago
Except for the leveraged Binance futures "tokens" that basically didn't function properly and all tanked without any real legal repercussions for Binance[0]. Unfortunately all of the competent exchanges with assets similar to these (let's be honest here... only FTX) aren't available for use in the USA in their full capacity. [0] - https://www.theblockcrypto.com/post/49898/how-a-misleading-tweet-drove-binance-listed-matic-token-tank-by-70 https://www.theblockcrypto.com/post/49898/how-a-misleading-t...
- SkyMarshal 5y ago
  Did you respond to the right post? I don't see how anything you wrote is relevant to my post. You're talking about trading, I was talking about R&D.

testific8 5y ago

Because (at least originially) the goal of cryptocurrencies were to combat the double spending problem, providing an alternative to fractional-reserve banking.

adventured 5y ago

They're planning to swap intermediaries, because in doing so the VCs can capture enormous value from the old guard. Meet the new boss, same as the old boss. Instead of Jamie Dimon, it'll just be the next Zuckerberg (and when you propose a contentious theory about an emergent pandemic, they'll merely censor your ability to pay your bills, buy things and feed your family). It's worth noting though, that just because there are intermediaries, that obviously doesn't mean they're all the same. It doesn't mean their attributes are the same. One intermediary can be superior (or worse) than another. All successful, large scale approaches to crypto will always require intermediaries. DeFi is a fantasy, identical to the fantasy of decentralized Internet services in general from the past 10-20 years (real DeFi will languish for exactly the same reasons; the reasons for which the evangelists never seem to understand, because their emotional buy-in clouds their judgment). Part of that script by A16Z is entirely fake of course. They're inserting rather comical wokeness into it (communities, collectively, economic redistribution, har har), because you have to do that with all corporate PR now. Their goal is merely to establish the next banking & finance kingpins and to mint as many billions of dollars as they can in the process.

jl2718 5y ago
Seriously, nobody would invest if that wasn’t 100% true.

71a54xd 5y ago

They're likely making vague references to "CBDC's" or Central Bank Digital Currencies[0]. Networks like Chia that focus on less power consumption will likely be used to facilitate these networks, there's already been significant ESG movement since any new developments will be mandated to have a limited environmental impact. [0] - https://www.investopedia.com/terms/c/central-bank-digital-currency-cbdc.asp https://www.investopedia.com/terms/c/central-bank-digital-cu...

dangerface 5y ago

> How can crypto "restore trust"? Crypto can be held and transacted in a secure and trust less way. I can store my $ in the bank which is secure but requires trust, or I can store my $ under my bed which I trust but isn't secure. > How can it enable "new kinds of governance" New crypto has introduced the idea of a governance token, if you hold one of these governance tokens it gives you a vote on the policies of the token. This is similar to how you have a vote in the building society if you hold funds at that building society, much more democratic than more traditional banks. > How can any economic benefits be distributed when by definition cryptocurrency holders are accountable to no one Holders are accountable to the economics of the token in the same way that the government is accountable to the economics of the country. If token holders do dumb stuff that devalues their token no one will buy it and their token will be worthless in the same was as a government just printing money makes the money worth less.