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Cryptocurrency uses the blockchain as a fundamental building block. For good faith proponents of cryptocurrencies, the appeal is that they provide the potential

Cryptocurrency uses the blockchain as a fundamental building block. For good faith proponents of cryptocurrencies, the appeal is that they provide the potential to do low friction digital payments (e.g. "micropayments"), reduce the barrier to entry to participate in financial transactions and allow for a single, global unifying currency. You may disagree that Bitcoin, or any other cryptocurrency, has the potential to do this or whether it can actually do this, but that's the appeal. Proof of Work (PoW) is probably necessary for a decentralized currency [0]. Proof of Stake (PoS) can be a valid cryptocurrency but fails in it's centralization criteria [1]. The Lightning network provides a layer-2 solution to payments, increasing transaction throughput and, thus, reducing PoW energy usage [2]. This might get into centralization territory but maybe this is a happy compromise between energy usage, throughput and centralization. In some sense, we have many "layer-2" like structures on the internet, with DNS caching, replication and load balancing etc. > Most importantly, non regulation doesn't always mean good. Otherwise why we need law and government? Why not live in the wild west and let strong people kill weak people? Why not let big company play the monopoly? As a counterpoint, regulation isn't always a good thing when it's been captured by hedge funds, oil companies, pharmaceutical companies or other special interests. I'm having a hard time understanding if the line "Why not let big company play the monopoly?" was meant to be rhetorical in the affirmative or the negative. Are you suggesting that company monopolies are a good thing? Or are you suggesting that a decentralized currency unseating what is essentially the current banking monopoly is a bad thing? [0] https://www.youtube.com/watch?v=ZDGliHwstM8&t=490s https://www.youtube.com/watch?v=ZDGliHwstM8&t=490s [1] https://github.com/libbitcoin/libbitcoin-system/wiki/Proof-of-Stake-Fallacy https://github.com/libbitcoin/libbitcoin-system/wiki/Proof-o... [2] https://en.wikipedia.org/wiki/Lightning_Network https://en.wikipedia.org/wiki/Lightning_Network

wb14123 5y ago
Yes, the intention of Bitcoin is good, and as a research paper, the idea of Blockchain is very genius and interesting. But back to the use case, it must has the basic function first then add more features to it. With low throughput and high fee, it can barely be used widely in normal life, especially for "micropayments". Then what's the point to make it decentralized? I had some experience with L2 solution, Polygon specifically. As you mentioned, it compromises security or/and decentralization. And I don't think it's a "happy" compromise, since the weak point of a system depends on it's weakest point. If L2 chain has a security or centralization problem, then it can be exploited so that the whole system has such problem. Even if the blockchain technology can replace current banking system, it's not the solution for problems like monopoly. It just replaced the companies/organizations that are in the monopoly position. Look at the crypto concurrency exchange market and mining farms, you can get a sense. To make it clear, by "Why not let big company play the monopoly?", I mean monopoly is a bad thing, which would happen if there is no regulation. So in the system of Blockchains, we still need the regulations we need in the current system. I know there are some problems in our political and economical system, but I don't believe Blockchain is the answer.

wb14123 5y ago

Yes, the intention of Bitcoin is good, and as a research paper, the idea of Blockchain is very genius and interesting. But back to the use case, it must has the basic function first then add more features to it. With low throughput and high fee, it can barely be used widely in normal life, especially for "micropayments". Then what's the point to make it decentralized? I had some experience with L2 solution, Polygon specifically. As you mentioned, it compromises security or/and decentralization. And I don't think it's a "happy" compromise, since the weak point of a system depends on it's weakest point. If L2 chain has a security or centralization problem, then it can be exploited so that the whole system has such problem. Even if the blockchain technology can replace current banking system, it's not the solution for problems like monopoly. It just replaced the companies/organizations that are in the monopoly position. Look at the crypto concurrency exchange market and mining farms, you can get a sense. To make it clear, by "Why not let big company play the monopoly?", I mean monopoly is a bad thing, which would happen if there is no regulation. So in the system of Blockchains, we still need the regulations we need in the current system. I know there are some problems in our political and economical system, but I don't believe Blockchain is the answer.