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How is this a single point of failure? The issue was limited to a subset of users keeping funds in a Crypto.com wallet. Unless by "it" you mean crypto.com and

How is this a single point of failure? The issue was limited to a subset of users keeping funds in a Crypto.com wallet. Unless by "it" you mean crypto.com and not Ethereum. Crypto.com is not decentralized.

smokey_circles 5y ago
It is the implementation. I believe in bitcoin, works well and I don't blame the consumer for the producer's problems when it comes to power. But exchanges have become a key part of the implementation. That's not the real issue though. The issue is the _need_ for exchanges. They provide a host of services, mostly all of which are antithetical to the loftier ideals espoused by bitcoin. Too many crypto fans waltz passed this glaringly obvious issue and these kinds of stories will never go away as a result. If banks get hacked, nobody blames the internet. "a small sub section of the system" applies as aptly to the blockchain as it does the global financial system, and I'm pretty confident being a locally popular trading commodity amongst edge communities is not the central goal for bitcoin
- danuker 5y ago
  > and I'm pretty confident being a locally popular trading commodity amongst edge communities is not the central goal for bitcoin Given the transaction fees needed for a distributed-enough network, and the bureaucracy needed when trading, it is not very useful as a currency, at least not for small payments, excluding Lightning. So it's a commodity.
  - thebean11 5y ago
    Excluding lightning and layer 2 solutions like rollups. Why would you make those exclusions though?
    - danuker 5y ago
      The reason is they are not yet accepted in many places, though in fairness, they seem to grow a lot.
wpietri 5y ago
And I think that's exactly the point. Cryptocurrency promoters endlessly talk up how it's part of a decentralized wave of the future. But in practice it's quite centralized, and the incentives point in that direction for the future. That's one of the points made very well recently by Moxie Marlinspike: https://moxie.org/2022/01/07/web3-first-impressions.html https://moxie.org/2022/01/07/web3-first-impressions.html
- thebean11 5y ago
  It’s not centralized though, crypto.com is one of many exchanges. Anybody can create an exchange, and a failure in one exchange doesn’t propagate to the rest of the network. Do you consider a website breaking a single point of failure for the internet?
  - wpietri 5y ago
    The original vision of Bitcoin was "a peer-to-peer electronic cash system" "allowing any two willing parties to transact directly with each other without the need for a trusted third party". So yes, something like crypto.com represents significant centralization.
    - thebean11 5y ago
      Crypto.com and its customers are willing parties who can transact with each other using this system, I'm not sure what your point is. The problem here is that one party trusted another party to hold on to their funds, and the holding party lost the funds. How is that an indictment of the protocol itself? Or put another way, how does Crypto.com and other centralized systems prevent me from using Bitcoin the "right" way?
      - thehappypm 5y ago
        It’s not an indictment of the protocol, so much as it is saying that the protocol is too low-level for average users and therefore centralized players (like Coinbase) tend to step in and provide the desired service.

smokey_circles 5y ago

It is the implementation. I believe in bitcoin, works well and I don't blame the consumer for the producer's problems when it comes to power. But exchanges have become a key part of the implementation. That's not the real issue though. The issue is the _need_ for exchanges. They provide a host of services, mostly all of which are antithetical to the loftier ideals espoused by bitcoin. Too many crypto fans waltz passed this glaringly obvious issue and these kinds of stories will never go away as a result. If banks get hacked, nobody blames the internet. "a small sub section of the system" applies as aptly to the blockchain as it does the global financial system, and I'm pretty confident being a locally popular trading commodity amongst edge communities is not the central goal for bitcoin

danuker 5y ago
> and I'm pretty confident being a locally popular trading commodity amongst edge communities is not the central goal for bitcoin Given the transaction fees needed for a distributed-enough network, and the bureaucracy needed when trading, it is not very useful as a currency, at least not for small payments, excluding Lightning. So it's a commodity.
- thebean11 5y ago
  Excluding lightning and layer 2 solutions like rollups. Why would you make those exclusions though?
  - danuker 5y ago
    The reason is they are not yet accepted in many places, though in fairness, they seem to grow a lot.

wpietri 5y ago

And I think that's exactly the point. Cryptocurrency promoters endlessly talk up how it's part of a decentralized wave of the future. But in practice it's quite centralized, and the incentives point in that direction for the future. That's one of the points made very well recently by Moxie Marlinspike: https://moxie.org/2022/01/07/web3-first-impressions.html https://moxie.org/2022/01/07/web3-first-impressions.html

thebean11 5y ago
It’s not centralized though, crypto.com is one of many exchanges. Anybody can create an exchange, and a failure in one exchange doesn’t propagate to the rest of the network. Do you consider a website breaking a single point of failure for the internet?
- wpietri 5y ago
  The original vision of Bitcoin was "a peer-to-peer electronic cash system" "allowing any two willing parties to transact directly with each other without the need for a trusted third party". So yes, something like crypto.com represents significant centralization.
  - thebean11 5y ago
    Crypto.com and its customers are willing parties who can transact with each other using this system, I'm not sure what your point is. The problem here is that one party trusted another party to hold on to their funds, and the holding party lost the funds. How is that an indictment of the protocol itself? Or put another way, how does Crypto.com and other centralized systems prevent me from using Bitcoin the "right" way?
    - thehappypm 5y ago
      It’s not an indictment of the protocol, so much as it is saying that the protocol is too low-level for average users and therefore centralized players (like Coinbase) tend to step in and provide the desired service.