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> 1. It's not a currency. It's an asset; It's an asset that can easily be used as a currency using technology like payment channels or rollups. > 2. Reversibl

> 1. It's not a currency. It's an asset; It's an asset that can easily be used as a currency using technology like payment channels or rollups. > 2. Reversible transactions for fiat currencies is a feature not a bug; I can make my blockchain transactions reversible if that's a shared priority between all parties taking part in the transaction. I can even assign some quorum of others who can facilitate the reversibility process if we want. Blockchain is about freedom to choose what is important to you and not be forced to give control to some anointed third-party. > 3. People who can't manage passwords won't be able to manage a wallet so mass appeal is always going to be limited; Managing private keys can be difficult. Social recovery wallets make this much easier - you can choose to be the sole individual who can generate your private key, you can trust a group of friends/family members, or you can trust a combination of friends, family members, and private/public institutions. People who don't value decentralization or autonomy can let a third party manage their keys, and people who don't trust third parties can manage their own keys with a fallback plan if they lose it. > 4. Crypto has its own vulnerabilities (eg 51% attack); I don't think any informed member of the crypto/blockchain community pretends that crypto doesn't have its own vulnerabilities. What they talk about is the existence of vulnerabilities and the trade-off you take by using a blockchain. 51% attacks are very difficult to pull off in a meaningful way (rewriting history or stealing funds), but by using a blockchain you can own assets, do p2p transactions, and have a record of digital asset ownership on top of many other uses. For many of us, the benefits outweigh the risks of a 51% attack or potential contract bugs, though many people who are now "investing" in this space don't understand anything about blockchains and treat them as money-printing machines, often using highly centralized chains that would be better run as centralized gambling services. > 5. This whole system is hugely energy wasteful; and (here's the big one) You are talking about a specific implementation detail of proof-of-work blockchains. Proof-of-Stake (PoS) chains exist, and even the second largest chain by market cap has been running its PoS chain for over a year and will fully migrate over to it within months (cue jokes about dev delays). Blockchains can and do exist in a form that doesn't waste huge amounts of energy. > 6. Government action could shut down crypto tomorrow so how robust is it really? I see people have already replied about this point. Certainly there are ways that governments could hamper blockchain development and adoption, though they could also embrace the technology. Blockchains were created to give power to people over the governments and large financial institutions that control them - sadly, most people in the space have lost sight of this and are focused on getting rich. In a world where all assets (including currency) will soon be digital, having government control over these assets is a huge risk to individuals whose governments may someday freeze their assets or fall to an authoritative regime that creates an economic prison where fleeing oppression means losing what you've spent your life working to earn. People should have power over their governments, not the other way around, and giving people a way of holding assets that are beyond government control is a great start.

cletus 5y ago
> It's an asset that can easily be used as a currency using technology like payment channels or rollups. That's true of any asset. You miss the main point about what makes a currency a currency. Bitcoin, for example, is massively deflationary to the point of someone having spent $800 million on a pizza [1]. People are also hoarding (hodling) crypto... like an asset. > Social recovery wallets make this much easier You can recover a wallet but what does it matter if someone has drained it? I guess it matters if the wallet is tied to certain smart contracts. This also matters for so-called Web3 identities. Any such recovery mechanisms are also an attack vector. > Proof-of-Stake (PoS) chains exist I'm well aware of PoS (vs PoW). For years there's been a lot of hand-waving how PoS will fix everything. PoS just seems to trade one set of problems for another. Whereas PoW has an economic incentive (ie mining new coins) to maintain the blockchain, PoS doesn't. I've heard the analogy that PoS is like a presidential election where only the richest can vote. > sadly, most people in the space have lost sight of this and are focused on getting rich This is the only force behind crypto. Many are obsessed at jumping on the next Bitcoin so you see people jumping on NFTs, having wallets with 300+ different coins in them, etc. If the belief that crypto will only go up in value is the only thing propping up the network what happens when that belief goes away/ Every bubble can burst. [1]: https://www.complex.com/life/2019/05/man-who-spent-800-million-in-bitcoin-on-pizza-gives-first-televised-interview https://www.complex.com/life/2019/05/man-who-spent-800-milli...
- PretzelPirate 5y ago
  > Bitcoin, for example, is massively deflationary to the point of someone having spent $800 million on a pizza Cryptocurrencies are not Bitcoin, Bitcoin is a cryptocurrency. I can use an algorithmic stable coin that matches any asset. A currency also doesn’t require stability. I spend cryptocurrency all the time even though the price fluctuates. The point is that it can be used as a currency, though you may not see most people doing that in practice. > Any such recovery mechanisms are also an attack vector. Sure they’re attack vectors, but they can be mitigated quite easily if you’re afraid that someone might kidnap your friends to recover your private key. I can timelock my funds or have alternative keys that can challenge any attempt to move my funds. These aren’t hard problems to solve, but building the right UX is hard and often times traditional financial institutions still do a bad job at implementing those. > I've heard the analogy that PoS is like a presidential election where only the richest can vote. Most solutions in life are trading one set of problems for another, you just choose the solution with the fewest issues. People often criticize PoS by saying it reinforces the wealth of the already wealthy. The same can be said of PoW (mining at scale to be competitive is capital intensive), banking, or any industry. There’s a reason that poor people have a harder time starting businesses. PoS makes it easier for small players to pool funds and have shared validators that can earn them all money without needing the time and expertise to run mining hardware. PoS also comes with some nicer solution than PoS, including the ability to punish dishonest network participants. In PoW, you can’t actually kick a single dishonest miner off the chain. If you switch to a new PoW algorithm, all miners need to buy new ASICs and there’s no guarantee that the attacker won’t buy up the majority of the hash rate. Because of that you might choose to use an ASIC-resistant algorithm and rely on GPUs, but if your attacker buys sufficient GPU hashing power, they are now in control for as long as they can afford to run. In PoS, you burn the attacker’s capital and they have to rebuy the stakes token to resume the attack. This will cause a massive increase in asset price, followed by the attacker losing all of their funds again as they are burned. The only downside to PoS is that you have weaker properties for knowing what the “true chain” is when you initially sync a node (there’s no concept of ‘work’). You can mitigate that via trusting a third party, or buy getting the network state in aggregate from a large number of unique nodes. > This is the only force behind crypto. Many are obsessed at jumping on the next Bitcoin so you see people jumping on NFTs, having wallets with 300+ different coins in them, etc. If the belief that crypto will only go up in value is the only thing propping up the network what happens when that belief goes away/ Every bubble can burst. Perhaps from your limited engagement with the community, you think this is true. To be fair, it is the most vocal part of the community and I certainly wish there were fewer speculators and people hoping to become overnight millionaires. Perhaps when you say “the only force behind crypto”, you mean behind the price of crypto, but that’s not a very interesting topic if you ask me. I don’t care about the bubble or the price of crypto, so arguing from that perspective is arguing against points I haven’t made. There are plenty of people who focus on the technology and the advantages that decentralization brings. You can find a great community of these people in the Eth R&D discord or ethresear.ch.

cletus 5y ago

> It's an asset that can easily be used as a currency using technology like payment channels or rollups. That's true of any asset. You miss the main point about what makes a currency a currency. Bitcoin, for example, is massively deflationary to the point of someone having spent $800 million on a pizza [1]. People are also hoarding (hodling) crypto... like an asset. > Social recovery wallets make this much easier You can recover a wallet but what does it matter if someone has drained it? I guess it matters if the wallet is tied to certain smart contracts. This also matters for so-called Web3 identities. Any such recovery mechanisms are also an attack vector. > Proof-of-Stake (PoS) chains exist I'm well aware of PoS (vs PoW). For years there's been a lot of hand-waving how PoS will fix everything. PoS just seems to trade one set of problems for another. Whereas PoW has an economic incentive (ie mining new coins) to maintain the blockchain, PoS doesn't. I've heard the analogy that PoS is like a presidential election where only the richest can vote. > sadly, most people in the space have lost sight of this and are focused on getting rich This is the only force behind crypto. Many are obsessed at jumping on the next Bitcoin so you see people jumping on NFTs, having wallets with 300+ different coins in them, etc. If the belief that crypto will only go up in value is the only thing propping up the network what happens when that belief goes away/ Every bubble can burst. [1]: https://www.complex.com/life/2019/05/man-who-spent-800-million-in-bitcoin-on-pizza-gives-first-televised-interview https://www.complex.com/life/2019/05/man-who-spent-800-milli...

PretzelPirate 5y ago
> Bitcoin, for example, is massively deflationary to the point of someone having spent $800 million on a pizza Cryptocurrencies are not Bitcoin, Bitcoin is a cryptocurrency. I can use an algorithmic stable coin that matches any asset. A currency also doesn’t require stability. I spend cryptocurrency all the time even though the price fluctuates. The point is that it can be used as a currency, though you may not see most people doing that in practice. > Any such recovery mechanisms are also an attack vector. Sure they’re attack vectors, but they can be mitigated quite easily if you’re afraid that someone might kidnap your friends to recover your private key. I can timelock my funds or have alternative keys that can challenge any attempt to move my funds. These aren’t hard problems to solve, but building the right UX is hard and often times traditional financial institutions still do a bad job at implementing those. > I've heard the analogy that PoS is like a presidential election where only the richest can vote. Most solutions in life are trading one set of problems for another, you just choose the solution with the fewest issues. People often criticize PoS by saying it reinforces the wealth of the already wealthy. The same can be said of PoW (mining at scale to be competitive is capital intensive), banking, or any industry. There’s a reason that poor people have a harder time starting businesses. PoS makes it easier for small players to pool funds and have shared validators that can earn them all money without needing the time and expertise to run mining hardware. PoS also comes with some nicer solution than PoS, including the ability to punish dishonest network participants. In PoW, you can’t actually kick a single dishonest miner off the chain. If you switch to a new PoW algorithm, all miners need to buy new ASICs and there’s no guarantee that the attacker won’t buy up the majority of the hash rate. Because of that you might choose to use an ASIC-resistant algorithm and rely on GPUs, but if your attacker buys sufficient GPU hashing power, they are now in control for as long as they can afford to run. In PoS, you burn the attacker’s capital and they have to rebuy the stakes token to resume the attack. This will cause a massive increase in asset price, followed by the attacker losing all of their funds again as they are burned. The only downside to PoS is that you have weaker properties for knowing what the “true chain” is when you initially sync a node (there’s no concept of ‘work’). You can mitigate that via trusting a third party, or buy getting the network state in aggregate from a large number of unique nodes. > This is the only force behind crypto. Many are obsessed at jumping on the next Bitcoin so you see people jumping on NFTs, having wallets with 300+ different coins in them, etc. If the belief that crypto will only go up in value is the only thing propping up the network what happens when that belief goes away/ Every bubble can burst. Perhaps from your limited engagement with the community, you think this is true. To be fair, it is the most vocal part of the community and I certainly wish there were fewer speculators and people hoping to become overnight millionaires. Perhaps when you say “the only force behind crypto”, you mean behind the price of crypto, but that’s not a very interesting topic if you ask me. I don’t care about the bubble or the price of crypto, so arguing from that perspective is arguing against points I haven’t made. There are plenty of people who focus on the technology and the advantages that decentralization brings. You can find a great community of these people in the Eth R&D discord or ethresear.ch.