8 ms·
This essay is too simplistic about the motivations of some crypto holders. For many people, the more complete sentiment is this: People don't want to run thei
by jasode 5y ago
This essay is too simplistic about the motivations of some crypto holders. For many people, the more complete sentiment is this: People don't want to run their own bank but they'd rather deal with that extra hassle instead of letting the government erode their purchasing power or confiscate their savings.
How much of a reality that is to particular person depends their economic environment. A Venezuelan living with hyperinflation thinks about the fragility of their savings differently than an American.
Likewise, many don't really want to run their own electric generator because it's noisy and keeping diesel fuel on hand is extra work. However, they'd rather deal with that than have no electricity when the power company issues rolling blackouts.
So, an option can be framed as a "bad choice" but it must also be compared to other bad choices that may be worse. Which bad choice do people prefer? A noisy diesel power generator they have to babysit or a no power at all?
Writing a hypothetical essay titled "People Don't Want to Run Their Own Diesel Generators" -- will not actually educate readers on what's happening.
Yes, crypto POW uses too much energy. But how do you get people to prioritize the environmental impact over their fears of government manipulation?
- edent 5y agoAuthor here. I broadly agree with you. I run my own power generation. They're solar panels on my roof and require zero maintenance. People don't want to run generators. They want stable electricity. There are a variety of ways we can give it to them. Similarly, people in a hyper-inflation environment don't want crypto - they want stability. But there's nothing inherent in crypto which prevents hyperinflation. Yes, I've read the original bitcoin paper. That talks about monetary supply - it doesn't do anything if a cartel decides to raise prices.
- magicjosh 5y agoThis article seems like it could have been written in 2009 at the launch of Bitcoin. It has no real world examples or data. There are so many disaster stories. Is there a reason you chose to write such a high level article now? One of the things that made Moxie's piece a hit was it had real examples of his experiences trying to do things. But this article has none of these examples or experience. For example, your article misses people who are indeed using cryotocurrencies as banks [1]. It misses the current conversation around social management of keys. The rise of automated exchanges like Uniswap. Lots of room for critiques on these items. That the only examples of people using crypto for real banking are in collapsing currencies. That if there's such a problem managing keys that social management will still fail. But you seem to have missed all of them which really undercuts your article to me. Again, this seems like it could have been written in 2010 based on the concept of crypto rather than real world experience. Just curious about your motivations for such a piece. It certainly has attracted commenting here. Disclosure: I own crypto [1] Reporting of LocalBitcoin use in Venezuela. Certainly room to use these examples of why cryptocurrencies will never scale, but not mentioned in the article: https://www.reddit.com/r/Bitcoin/comments/s5i64l/24_btc_were_traded_in_venezuela_last_week_only/ https://www.reddit.com/r/Bitcoin/comments/s5i64l/24_btc_were...
- edent 5y agoI am currently studying for an MSc which has a semester on Blockchain. You can see my current thoughts at https://shkspr.mobi/blog/tag/certified-blockchain-professional/ https://shkspr.mobi/blog/tag/certified-blockchain-profession...
- magicjosh 5y agoNice! Sounds like the course and book aren't delivering what you want. Agree with your points about the summaries and mining doge. Bizarre. I found your reflections in these posts much more engaging than the main post for this thread. Highly recommend the MIT video course on blockchains: https://youtube.com/playlist?list=PLUl4u3cNGP63UUkfL0onkxF6MYgVa04Fn https://youtube.com/playlist?list=PLUl4u3cNGP63UUkfL0onkxF6M... And for a deep dive into any specific project, it there's an episode of the Zero Knowledge podcast about a project it's worth listening to.
- edent 5y agoThanks, I'll check it out. Have a lovely weekend.
- hyper_reality 5y agoAbsolutely right, the essay writes from a comfortable UK perspective and ignores large amounts of the world where well-regulated, trustworthy financial institutions aren't available. And even UK banks aren't immune from failure or just mistakes which can freeze people's savings and put them in terrible situations that take months to resolve. To add to your counterpoint, the OP's praise of going cashless as opposed to the problems of cash is another fine example. It's certainly more convenient to use your card everywhere, but if everyone did it then just a handful of payment processors would gain immense power, with the ability to track, monitor, and censor all transactions. Plenty of dystopian fiction like The Handmaid's Tale covers what can happen when this infrastructure is abused. Cash may have problems but it plays an important role in an open society, and redundancy when a major payment network goes down (as Visa did across Europe on 1st June 2018, causing retail chaos). But many vendors no longer accept cash and this will only accelerate as more people never use it. In praising going cashless as protecting ourselves from being our own banks, the OP misses the forest for the trees.
- Trasmatta 5y ago> but they'd rather deal with that extra hassle instead of letting the government erode their purchasing power or confiscate their savings. Crypto doesn't protect you from either of those things
- lowkey 5y agoBitcoin does. The math is simple. No government in the world can debase the value of Bitcoin whose total supply is < 21 million and no central bank can print more.
- mtoner23 5y agoSure they can, they could ban its use, if the US banned using bitcoin im confident its value would drop
- lowkey 5y agoAgree if the US banned Bitcoin the USD price would drop - in the short-term. However, it is impossible for any government to kill Bitcoin by outlawing it. The best they could hope for is to prevent their citizens from participating in the global Bitcoin network. When you consider it’s scarcity, security and censorship-resistance properties, it is clear why game theory suggests that so long as some governments have not banned Bitcoin - the value will migrate away from those countries towards countries that allow it. Similarly, when the US gov banned alcohol in prohibition, it did not eliminate demand for booze. It just moved the market underground.
- mtoner23 5y agocertainly it wouldn't actually be banned. but price would drop for sure. governments still have power even over "decentralized" stuff
- root_axis 5y ago> No government in the world can debase the value of Bitcoin A government can't, but a cartel of miners can and they do every time they mint bitcoins via mining rewards and they won't stop at 21 million.