7 ms·

Author here. I broadly sympathise with what you're saying. But I think I disagree with: > In other words, you can build centralization on top of decentralizati

by edent 5y ago

Author here. I broadly sympathise with what you're saying. But I think I disagree with: > In other words, you can build centralization on top of decentralization, but the opposite is not true. In the UK, we now have "Open Banking". Which means my bank offers an API which I can plug into. It also means that loads of 3rd parties can now offer banking services on top of the "centralised" core. So, in a way, a decentralised system is being built on top of a centralised system. I'll also note that - in my opinion - Blockchains aren't really decentralised. There's no way you can do an "Off-Chain" transaction. Everything has to be recorded on a single ledger.

lrvick 5y ago
I would advise you to look at the Lightning protocol which allows you to do transactions off chain via credit lines for as long as you like. You only pay a fee to record to the blockchain ledger for eventual settlement.
- qayxc 5y ago
  Lightning is only safe if you constantly monitor the blockchain, otherwise your transactions aren't safe (as in double spending is still possible). Opening and closing Lightning channels is an operation that requires a transaction on the blockchain - no real win there. Due to the restriction just mentioned, most L2 transactions will take place via intermediaries who you need to trust and who can take arbitrary fees for their service as well (the whole routing business). Lightning might be ok for regular payments (subscriptions, etc.), but at the same time it offers not a single advantage over traditional banking and credit cards other than explicitly not being either. It might alleviate the transaction time and energy problems of the blockchain, but it does nothing to tackle any of the other problems mentioned by the author.
  - gruez 5y ago
    >Lightning is only safe if you constantly monitor the blockchain "constantly" in this case means "once every 2 weeks". You can also have a third party do it for you without having to hand over your keys.
    - qayxc 5y ago
      > "constantly" in this case means "once every 2 weeks" No. Constantly means exactly that - revoked transactions for either party cannot be checked otherwise. I didn't even include the need to be online all the time, since otherwise payments don't work either as multiple interactions are required for each payment. > You can also have a third party do it for you without having to hand over your keys. And of course that 3rd party is totally trustworthy for some reason and offers their service for free? The 3rd parties still need to run scripts that have to work correctly. We all see how well that one works on a regular basis, what with the multi-million dollar thefts that happened recently due to flawed contracts and scripts.
      - gruez 5y ago
        >No. Constantly means exactly that - revoked transactions for either party cannot be checked otherwise. Source? My understanding is unless the channel is cooperatively closed, there's a waiting period (ie. the two weeks) before the transaction is finalized to the blockchain. During that time that transaction can be challenged/overridden. https://wiki.ion.radar.tech/tech/channels/channel-closing https://wiki.ion.radar.tech/tech/channels/channel-closing >I didn't even include the need to be online all the time, since otherwise payments don't work either as multiple interactions are required for each payment. That seems to be a completely separate issue. Short of receiving random donations, I can't think of any situation where you want to make a payment, but somehow aren't online. >And of course that 3rd party is totally trustworthy for some reason and offers their service for free? You're making it sound like it's an issue, but I'm not seeing it. Thousands of hobbyists run bitcoin nodes for free, which costs storage and bandwidth. >The 3rd parties still need to run scripts that have to work correctly. We all see how well that one works on a regular basis, what with the multi-million dollar thefts that happened recently due to flawed contracts and scripts. ETH =/= BTC It's far easier for the community to scrutinize one set of code than for everyone to scrutinize the implementation they rolled themselves.
        qayxc 5y ago
        > Source? https://lightning.network/lightning-network-paper.pdf https://lightning.network/lightning-network-paper.pdf Chapter 3.1.4 Commitment Transactions: Ascribing Blame Penalties for contract violations can only be enforced "if one is able to ascribe blame for broadcasting an old transaction." Broadcasting transactions takes place on the BC, so identifying an old transaction is only possible by finding it on the BC. The same is true for revocable commitment transactions. Both parties must observe the BC at all times in order to know whether the other party did indeed violate the contract by broadcasting a transaction. Contract violations cannot be detected otherwise. > I can't think of any situation where you want to make a payment, but somehow aren't online. Out here in The Real World(tm) I find the opposite to be the case. I cannot think of a situation in which I want to make a payment that requires me to be online. Neither my debit card, nor my credit card, and especially not cash has such requirement. I can buy petrol, groceries, clothes, pay the barber, eat at a restaurant, have a drink at a bar, pay admission for a ball game, etc. etc. all without being online. Go ahead and call me a Boomer, but we seem to exist in very different realities. > Thousands of hobbyists run bitcoin nodes for free, which costs storage and bandwidth. That's orthogonal to the problem of Lightning network routing fees. It doesn't matter who operates a node and how. What matters is that unless you open a bi-directional payment channel, you'll route transactions through intermediaries that will take fees. > It's far easier for the community to scrutinize one set of code than for everyone to scrutinize the implementation they rolled themselves. I think you missed something here. Lightning isn't a single centralised implementation. Just look at chapter 8.4 - once routing tables are in place, there's a wide open door for routing payment channels through profitable routes and tracking, for example. Routing also requires keys to held online for intermediary nodes for latency reasons, which is another considerable risk since unlike with banking, there's neither oversight nor security regulations in place. If you actually read the whole story, you'll quickly notice that a lot of Lightning's mechanisms are built on trust in scripts, incentives, and edge software that "does the right thing" (e.g. periodically make backups and checking the other party's state for honesty).
  - lrvick 5y ago
    I know people that use Lightning frequently at a local coffee shop via long term tabs there is no rush to close. Saves them a ton in Visa transaction fees long term even after they eventually pay a Bitcoin transaction fee to close the tab.
    - lbotos 5y ago
      So you are saying that the business doesn't convert BTC to USD near immediately? Seems like a lot of currency risk here.
      - lrvick 5y ago
        I am only a home owner because the value of my deflationary BTC savings dramatically outpaced inflationary USD savings account interest. If bitcoin is coming in constantly you get it at the average price via dollar cost averaging and the average value of Bitcoin has trended sharply up for a decade. Selling BTC for USD is most likely a loss to inflation if you intend on holding for a year or more.
        ryan_lane 5y ago
        You gambled your money against other people. You won, and they lost. Their losses paid for your house. 12m y/y bitcoin is up 8% and the S&P is up 18%, so if you gambled your money into bitcoin a year ago, you made a bad choice. Note that last week bitcoin was down 5% y/y. Bitcoin, y/y is hardly beating USD inflation, right now, after a major increase in the price today. Also, stop comparing a speculative asset to a currency. USD isn't meant to be held as an investment. It's meant to be spent, or invested in an asset that appreciates more than inflation.
      - mikegreenberg 5y ago
        Lightning is worse than that. When you do try to convert from BTC to USD, you pay a transaction fee twice. Once to close the channel, and another to transfer to the party where you want to exchange your BTC. And further, you can't predict the fee you'll pay. And I hope you aren't in a hurry to settle in those cases.
- mikegreenberg 5y ago
  I'm sorry, but Lightning is a mess and it would be irresponsible to suggest that it's safe. 1. Unpredictable fees make usage for small amounts almost require a long-lived channel to be worthwhile. 2. UX around Lightning channels are painful. You can't receive BTC in a channel unless you put BTC in as collateral. You can't spend more than the channel allows. Routing is unpredictable and fickle causing transactions to fail just as often (if not worse) as complete successfully. (Perfect for one-off transactions /s) All Lightning wallets (with the exception of one or two) are custodial and if they aren't, they cost a lot of energy to run on your phone because they're constantly chatting with the network. 3. The whole point of cryptocurrency is diversify the control across the network. The design of Lightning motivates large hub and spoke connections between users which consolidate control to a few individuals. 4. The complexity for any business to integration Lightning into their purchase flow is expensive due to the many states your channel can exist in and need to considered as part of your integration. Not to mention the added costs of monitoring the BTC network to protect your channels. Or you find a merchant provider you have to trust with your processing...at which point, you're just using credit cards by another name. 5. And due to the complexity of Lightning's design, there are systemic bugs which expose users to more risk than if they just used a gift card or credit card in the first place. (One case in particular, a channel which is mostly settled on side B (versus side A) such that A's value on their side of the channel is less than the dust limit of the BTC network (which is often given the highly fluctuating fees) will allow B to force the close of the channel causing A to lose their value in the channel (because A will need to spend more than their side of the channel is worth and will be a worse outcome than if channel A just ate the loss from the channel being maliciously closed)).
g4zj 5y ago
> So, in a way, a decentralised system is being built on top of a centralised system. Is this not still fundamentally a centralized system?
- edent 5y ago
  Yes. But cryptocurrencies are decentralised, and have coalesced around a few centralised entities. I imagine it won't be long before Coinbase, for example, will warn you against transferring to wallets which aren't held by one of the big providers.
  - magicjosh 5y ago
    What do you think about Uniswap and other automated decentralized exchanges? These automated exchanges seem to be growing rapidly. At one point last year Uniswap had 77% of Coinbase's trading volume: https://tokenist.com/with-33x-fewer-employees-uniswap-has-77-of-coinbases-trading-volume/ https://tokenist.com/with-33x-fewer-employees-uniswap-has-77...
  - g4zj 5y ago
    > I imagine it won't be long before Coinbase, for example, will warn you against transferring to wallets which aren't held by one of the big providers. Perhaps, but I'm not sure if that answers my question. Cryptocurrency networks are decentralized on their own, but I'd say the way we generally interact with them is not. It sounds like we agree on this point. However, whether a decentralized system is accessed through a centralized layer or vice verse, the result is a service that is not fully decentralized. If any entity, such as a bank, third-party banking service provider, cryptocurrency exchange, etc., is involved at any point, that entity effectively has some control over what happens on the associated decentralized system. This results in an at least _partially_ centralized system.
  - emteycz 5y ago
    My computer warns me before executing an unsigned program but that doesn't mean I can't do it or that it's not useful.
- 5y ago
f38zf5vdt 5y ago
Standardizing an API by a central authority means more centralization, not less. It is not difficult to sympathize with people who do not fully trust banks, especially if you grew up in a third world country with corrupt institutions. There have been times in history where you could trust banks and times in history when you could not. I'm not sure the past 70 years of grand prosperity for the west is a good way to gauge the trustworthiness of institutions owned and operated by others, since in the full scope of history the outcomes have been mixed. That doesn't mean decentralized web3 cryptocurrency stuff is the one-size-fits-all answer, but I am sure to some people it is. And people should be free to choose the way to protect their assets and hedge bets against different local and global outcomes as they choose. Governments are the same way, with their large stockpiles of real physical goods like weapons and gold.
- the_other 5y ago
  > Standardizing an API by a central authority means more centralization, not less. No. Standards and protocols are the essence of decentralisation and collaboration.
  - f38zf5vdt 5y ago
    If they are generated ad-hoc by members of the public and agreed to not by coercion. In the case of the UK open banking initiative, it was largely a collaboration between large banks and some fintech providers after being mandated by parliament. Hardly the Linux mailing list or a Python enhancement proposal. edit: Not sure why I'm being down-voted. If you believe that government created and mandated "open protocols" are really the same as decentralized protocols, imagine what it would be like if the US government forced every major institution to use the backdoored Dual_EC_DRBG they created instead of a sane cryptography protocol. A government enforced "open protocol" is not open at all if you're forced to use it.
kevinak 5y ago
> In the UK, we now have "Open Banking". Which means my bank offers an API which I can plug into. It also means that loads of 3rd parties can now offer banking services on top of the "centralised" core. > So, in a way, a decentralised system is being built on top of a centralised system. Why would offering an API mean that the service is decentralised? It doesn't - it just lets you get some data in or out. You are still beholden to a single party that can cut you off at a moments notice. > I'll also note that - in my opinion - Blockchains aren't really decentralised. There's no way you can do an "Off-Chain" transaction. Everything has to be recorded on a single ledger. Not true at all. Bitcoin has a Layer 2 solution where transactions are done off-chain in a non-custodial manner. Those don't need to be recorded on the ledger, only the settlement is (if you decide you do not wish to participate any longer).
- tremon 5y ago
  You are still beholden to a single party that can cut you off at a moments notice. Not in the UK, nor in Europe. Don't project your (presumably US) failed institutions onto the rest of us.
  - hungryforcodes 5y ago
    Please explain.
  - dns_snek 5y ago
    This is definitely true in EU (and presumably in UK as well). If your bank doesn't like the businesses you're interacting with, e.g. gambling sites or cryptocurrency exchanges, they can close your account without notice or recourse. And even if your account doesn't get closed immediately you are still subjected to invasive KYC procedures, even if you haven't done anything wrong. Failure to comply of course leads to your account being closed.
    - f38zf5vdt 5y ago
      Completely true. See "World-Check". [1] There are a number of these products and all the major banks use them to vet customers. [1] https://www.vice.com/en/article/pak7wb/exclusive-secret-blacklist-marking-innocents-as-terrorists-continues-to-grow https://www.vice.com/en/article/pak7wb/exclusive-secret-blac...
miracle2k 5y ago
> In the UK, we now have "Open Banking". Which means my bank offers an API which I can plug into. It also means that loads of 3rd parties can now offer banking services on top of the "centralised" core. I don't think you can though, not without passing an expensive certification process, right? I mention this because as a German, the EU Open Banking initiative made my life worse. Banks are phasing out actually open FinTS standard, for which their are a pletora of Open Source libraries, and many apps by independent developers that were able to connect to any bank. /I/ was actually able to start up a shell and pull data from my bank accounts. This does not seem to be the case with Open Banking, where I have to pay a service provider that has passed certification to allow me to access my bank data. This is an important aspect of crypto currencies - the goal is to be permissionless. The decentralization is merely a requirement to achieve this.
bombcar 5y ago
You can "kind" of do off-chain with blockchain, simply trade the private keys in a back alley somewhere.
- edent 5y ago
  No you can't. Because you need to check those keys on the blockchain. And you have no idea if those keys are being traded in a hundred other back alleys simultaneously.
ilaksh 5y ago
Some good points, but missing the most important understanding of what cryptocurrency actually is at it's core. Once you understand this, you will see that although humans are treating the technology idiotically as they do everything, fundamentally it's a basic and critical advance. And arguing against it is holding back society. Cryptocurrency is just the best contemporary approach we have for applying computer science to money. That involves cryptography and blockchains because they are the most relevant technologies for accounting. The typical alternative is a database from the 1970s or 80s running on something like a private mainframe, that can be modified at whim by those who control it. The biggest problem with this is that when so many have a chance to cheat, some will. But the core failing of the concept is that it's a private database with no mechanism for external (or even necessarily internal) verification. The core thing that people such as yourself will eventually learn about is that cryptography and blockchains are the best approach we have for solving these problems. It's just the basic application of computer science to accounting. Many of these systems were built before cryptography was well known, and some run on hardware that may not even be capable of current cryptographic standards. Fundamentally, arguing against cryptocurrency is like arguing against calculus in the 17th century.

by edent 5y ago

lrvick 5y ago

I would advise you to look at the Lightning protocol which allows you to do transactions off chain via credit lines for as long as you like. You only pay a fee to record to the blockchain ledger for eventual settlement.

qayxc 5y ago
Lightning is only safe if you constantly monitor the blockchain, otherwise your transactions aren't safe (as in double spending is still possible). Opening and closing Lightning channels is an operation that requires a transaction on the blockchain - no real win there. Due to the restriction just mentioned, most L2 transactions will take place via intermediaries who you need to trust and who can take arbitrary fees for their service as well (the whole routing business). Lightning might be ok for regular payments (subscriptions, etc.), but at the same time it offers not a single advantage over traditional banking and credit cards other than explicitly not being either. It might alleviate the transaction time and energy problems of the blockchain, but it does nothing to tackle any of the other problems mentioned by the author.
- gruez 5y ago
  >Lightning is only safe if you constantly monitor the blockchain "constantly" in this case means "once every 2 weeks". You can also have a third party do it for you without having to hand over your keys.
  - qayxc 5y ago
    > "constantly" in this case means "once every 2 weeks" No. Constantly means exactly that - revoked transactions for either party cannot be checked otherwise. I didn't even include the need to be online all the time, since otherwise payments don't work either as multiple interactions are required for each payment. > You can also have a third party do it for you without having to hand over your keys. And of course that 3rd party is totally trustworthy for some reason and offers their service for free? The 3rd parties still need to run scripts that have to work correctly. We all see how well that one works on a regular basis, what with the multi-million dollar thefts that happened recently due to flawed contracts and scripts.
    - gruez 5y ago
      >No. Constantly means exactly that - revoked transactions for either party cannot be checked otherwise. Source? My understanding is unless the channel is cooperatively closed, there's a waiting period (ie. the two weeks) before the transaction is finalized to the blockchain. During that time that transaction can be challenged/overridden. https://wiki.ion.radar.tech/tech/channels/channel-closing https://wiki.ion.radar.tech/tech/channels/channel-closing >I didn't even include the need to be online all the time, since otherwise payments don't work either as multiple interactions are required for each payment. That seems to be a completely separate issue. Short of receiving random donations, I can't think of any situation where you want to make a payment, but somehow aren't online. >And of course that 3rd party is totally trustworthy for some reason and offers their service for free? You're making it sound like it's an issue, but I'm not seeing it. Thousands of hobbyists run bitcoin nodes for free, which costs storage and bandwidth. >The 3rd parties still need to run scripts that have to work correctly. We all see how well that one works on a regular basis, what with the multi-million dollar thefts that happened recently due to flawed contracts and scripts. ETH =/= BTC It's far easier for the community to scrutinize one set of code than for everyone to scrutinize the implementation they rolled themselves.
      - qayxc 5y ago
        > Source? https://lightning.network/lightning-network-paper.pdf https://lightning.network/lightning-network-paper.pdf Chapter 3.1.4 Commitment Transactions: Ascribing Blame Penalties for contract violations can only be enforced "if one is able to ascribe blame for broadcasting an old transaction." Broadcasting transactions takes place on the BC, so identifying an old transaction is only possible by finding it on the BC. The same is true for revocable commitment transactions. Both parties must observe the BC at all times in order to know whether the other party did indeed violate the contract by broadcasting a transaction. Contract violations cannot be detected otherwise. > I can't think of any situation where you want to make a payment, but somehow aren't online. Out here in The Real World(tm) I find the opposite to be the case. I cannot think of a situation in which I want to make a payment that requires me to be online. Neither my debit card, nor my credit card, and especially not cash has such requirement. I can buy petrol, groceries, clothes, pay the barber, eat at a restaurant, have a drink at a bar, pay admission for a ball game, etc. etc. all without being online. Go ahead and call me a Boomer, but we seem to exist in very different realities. > Thousands of hobbyists run bitcoin nodes for free, which costs storage and bandwidth. That's orthogonal to the problem of Lightning network routing fees. It doesn't matter who operates a node and how. What matters is that unless you open a bi-directional payment channel, you'll route transactions through intermediaries that will take fees. > It's far easier for the community to scrutinize one set of code than for everyone to scrutinize the implementation they rolled themselves. I think you missed something here. Lightning isn't a single centralised implementation. Just look at chapter 8.4 - once routing tables are in place, there's a wide open door for routing payment channels through profitable routes and tracking, for example. Routing also requires keys to held online for intermediary nodes for latency reasons, which is another considerable risk since unlike with banking, there's neither oversight nor security regulations in place. If you actually read the whole story, you'll quickly notice that a lot of Lightning's mechanisms are built on trust in scripts, incentives, and edge software that "does the right thing" (e.g. periodically make backups and checking the other party's state for honesty).
- lrvick 5y ago
  I know people that use Lightning frequently at a local coffee shop via long term tabs there is no rush to close. Saves them a ton in Visa transaction fees long term even after they eventually pay a Bitcoin transaction fee to close the tab.
  - lbotos 5y ago
    So you are saying that the business doesn't convert BTC to USD near immediately? Seems like a lot of currency risk here.
    - lrvick 5y ago
      I am only a home owner because the value of my deflationary BTC savings dramatically outpaced inflationary USD savings account interest. If bitcoin is coming in constantly you get it at the average price via dollar cost averaging and the average value of Bitcoin has trended sharply up for a decade. Selling BTC for USD is most likely a loss to inflation if you intend on holding for a year or more.
      - ryan_lane 5y ago
        You gambled your money against other people. You won, and they lost. Their losses paid for your house. 12m y/y bitcoin is up 8% and the S&P is up 18%, so if you gambled your money into bitcoin a year ago, you made a bad choice. Note that last week bitcoin was down 5% y/y. Bitcoin, y/y is hardly beating USD inflation, right now, after a major increase in the price today. Also, stop comparing a speculative asset to a currency. USD isn't meant to be held as an investment. It's meant to be spent, or invested in an asset that appreciates more than inflation.
    - mikegreenberg 5y ago
      Lightning is worse than that. When you do try to convert from BTC to USD, you pay a transaction fee twice. Once to close the channel, and another to transfer to the party where you want to exchange your BTC. And further, you can't predict the fee you'll pay. And I hope you aren't in a hurry to settle in those cases.
mikegreenberg 5y ago
I'm sorry, but Lightning is a mess and it would be irresponsible to suggest that it's safe. 1. Unpredictable fees make usage for small amounts almost require a long-lived channel to be worthwhile. 2. UX around Lightning channels are painful. You can't receive BTC in a channel unless you put BTC in as collateral. You can't spend more than the channel allows. Routing is unpredictable and fickle causing transactions to fail just as often (if not worse) as complete successfully. (Perfect for one-off transactions /s) All Lightning wallets (with the exception of one or two) are custodial and if they aren't, they cost a lot of energy to run on your phone because they're constantly chatting with the network. 3. The whole point of cryptocurrency is diversify the control across the network. The design of Lightning motivates large hub and spoke connections between users which consolidate control to a few individuals. 4. The complexity for any business to integration Lightning into their purchase flow is expensive due to the many states your channel can exist in and need to considered as part of your integration. Not to mention the added costs of monitoring the BTC network to protect your channels. Or you find a merchant provider you have to trust with your processing...at which point, you're just using credit cards by another name. 5. And due to the complexity of Lightning's design, there are systemic bugs which expose users to more risk than if they just used a gift card or credit card in the first place. (One case in particular, a channel which is mostly settled on side B (versus side A) such that A's value on their side of the channel is less than the dust limit of the BTC network (which is often given the highly fluctuating fees) will allow B to force the close of the channel causing A to lose their value in the channel (because A will need to spend more than their side of the channel is worth and will be a worse outcome than if channel A just ate the loss from the channel being maliciously closed)).

g4zj 5y ago

> So, in a way, a decentralised system is being built on top of a centralised system. Is this not still fundamentally a centralized system?

edent 5y ago
Yes. But cryptocurrencies are decentralised, and have coalesced around a few centralised entities. I imagine it won't be long before Coinbase, for example, will warn you against transferring to wallets which aren't held by one of the big providers.
- magicjosh 5y ago
  What do you think about Uniswap and other automated decentralized exchanges? These automated exchanges seem to be growing rapidly. At one point last year Uniswap had 77% of Coinbase's trading volume: https://tokenist.com/with-33x-fewer-employees-uniswap-has-77-of-coinbases-trading-volume/ https://tokenist.com/with-33x-fewer-employees-uniswap-has-77...
- g4zj 5y ago
  > I imagine it won't be long before Coinbase, for example, will warn you against transferring to wallets which aren't held by one of the big providers. Perhaps, but I'm not sure if that answers my question. Cryptocurrency networks are decentralized on their own, but I'd say the way we generally interact with them is not. It sounds like we agree on this point. However, whether a decentralized system is accessed through a centralized layer or vice verse, the result is a service that is not fully decentralized. If any entity, such as a bank, third-party banking service provider, cryptocurrency exchange, etc., is involved at any point, that entity effectively has some control over what happens on the associated decentralized system. This results in an at least _partially_ centralized system.
- emteycz 5y ago
  My computer warns me before executing an unsigned program but that doesn't mean I can't do it or that it's not useful.
5y ago

f38zf5vdt 5y ago

Standardizing an API by a central authority means more centralization, not less. It is not difficult to sympathize with people who do not fully trust banks, especially if you grew up in a third world country with corrupt institutions. There have been times in history where you could trust banks and times in history when you could not. I'm not sure the past 70 years of grand prosperity for the west is a good way to gauge the trustworthiness of institutions owned and operated by others, since in the full scope of history the outcomes have been mixed. That doesn't mean decentralized web3 cryptocurrency stuff is the one-size-fits-all answer, but I am sure to some people it is. And people should be free to choose the way to protect their assets and hedge bets against different local and global outcomes as they choose. Governments are the same way, with their large stockpiles of real physical goods like weapons and gold.

the_other 5y ago
> Standardizing an API by a central authority means more centralization, not less. No. Standards and protocols are the essence of decentralisation and collaboration.
- f38zf5vdt 5y ago
  If they are generated ad-hoc by members of the public and agreed to not by coercion. In the case of the UK open banking initiative, it was largely a collaboration between large banks and some fintech providers after being mandated by parliament. Hardly the Linux mailing list or a Python enhancement proposal. edit: Not sure why I'm being down-voted. If you believe that government created and mandated "open protocols" are really the same as decentralized protocols, imagine what it would be like if the US government forced every major institution to use the backdoored Dual_EC_DRBG they created instead of a sane cryptography protocol. A government enforced "open protocol" is not open at all if you're forced to use it.

kevinak 5y ago

> In the UK, we now have "Open Banking". Which means my bank offers an API which I can plug into. It also means that loads of 3rd parties can now offer banking services on top of the "centralised" core. > So, in a way, a decentralised system is being built on top of a centralised system. Why would offering an API mean that the service is decentralised? It doesn't - it just lets you get some data in or out. You are still beholden to a single party that can cut you off at a moments notice. > I'll also note that - in my opinion - Blockchains aren't really decentralised. There's no way you can do an "Off-Chain" transaction. Everything has to be recorded on a single ledger. Not true at all. Bitcoin has a Layer 2 solution where transactions are done off-chain in a non-custodial manner. Those don't need to be recorded on the ledger, only the settlement is (if you decide you do not wish to participate any longer).

tremon 5y ago
You are still beholden to a single party that can cut you off at a moments notice. Not in the UK, nor in Europe. Don't project your (presumably US) failed institutions onto the rest of us.
- hungryforcodes 5y ago
  Please explain.
- dns_snek 5y ago
  This is definitely true in EU (and presumably in UK as well). If your bank doesn't like the businesses you're interacting with, e.g. gambling sites or cryptocurrency exchanges, they can close your account without notice or recourse. And even if your account doesn't get closed immediately you are still subjected to invasive KYC procedures, even if you haven't done anything wrong. Failure to comply of course leads to your account being closed.
  - f38zf5vdt 5y ago
    Completely true. See "World-Check". [1] There are a number of these products and all the major banks use them to vet customers. [1] https://www.vice.com/en/article/pak7wb/exclusive-secret-blacklist-marking-innocents-as-terrorists-continues-to-grow https://www.vice.com/en/article/pak7wb/exclusive-secret-blac...

miracle2k 5y ago

> In the UK, we now have "Open Banking". Which means my bank offers an API which I can plug into. It also means that loads of 3rd parties can now offer banking services on top of the "centralised" core. I don't think you can though, not without passing an expensive certification process, right? I mention this because as a German, the EU Open Banking initiative made my life worse. Banks are phasing out actually open FinTS standard, for which their are a pletora of Open Source libraries, and many apps by independent developers that were able to connect to any bank. /I/ was actually able to start up a shell and pull data from my bank accounts. This does not seem to be the case with Open Banking, where I have to pay a service provider that has passed certification to allow me to access my bank data. This is an important aspect of crypto currencies - the goal is to be permissionless. The decentralization is merely a requirement to achieve this.

bombcar 5y ago

You can "kind" of do off-chain with blockchain, simply trade the private keys in a back alley somewhere.

edent 5y ago
No you can't. Because you need to check those keys on the blockchain. And you have no idea if those keys are being traded in a hundred other back alleys simultaneously.

ilaksh 5y ago

Some good points, but missing the most important understanding of what cryptocurrency actually is at it's core. Once you understand this, you will see that although humans are treating the technology idiotically as they do everything, fundamentally it's a basic and critical advance. And arguing against it is holding back society. Cryptocurrency is just the best contemporary approach we have for applying computer science to money. That involves cryptography and blockchains because they are the most relevant technologies for accounting. The typical alternative is a database from the 1970s or 80s running on something like a private mainframe, that can be modified at whim by those who control it. The biggest problem with this is that when so many have a chance to cheat, some will. But the core failing of the concept is that it's a private database with no mechanism for external (or even necessarily internal) verification. The core thing that people such as yourself will eventually learn about is that cryptography and blockchains are the best approach we have for solving these problems. It's just the basic application of computer science to accounting. Many of these systems were built before cryptography was well known, and some run on hardware that may not even be capable of current cryptographic standards. Fundamentally, arguing against cryptocurrency is like arguing against calculus in the 17th century.