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I'm surprised the author makes no mention of centralized chains over testnets, since the importance of "skin in the game" as a learning strategy is emphasized.

by leppr 5y ago

I'm surprised the author makes no mention of centralized chains over testnets, since the importance of "skin in the game" as a learning strategy is emphasized. To learn Ethereum, getting around the Binance Smart Chain or Polygon ecosystems can be done for very little cost, all the while involving tokens with actual market value (BNB and custodied ETH respectively), and mostly up to date EVM implementations. Importantly, this will also confront users with a multitude of scams. I don't expect the amount and ingenuity of scams to die down, so learning to operate in an adversarial environment should be an integral part of any crypto education[1]. It would be dangerous to land into the real world of crypto with a false sense of security conferred by an otherwise realistic experience in value-less testnets. Technical expertise might deflect some scams, but a lot of them play more into social engineering (sometimes to an extreme degree[2]), which you will only encounter in live environments. [1]: This applies to cryptography as well. [2]: https://twitter.com/thomasg_eth/status/1492663192404779013 https://twitter.com/thomasg_eth/status/1492663192404779013

magicjosh 5y ago
User error is an order of magnitude more dangerous than scams. Estimates suggest 4 million bitcoin are lost due to user error [1]. Estimates also suggest $14B per year of cryptocurrency is lost to scams. [2] At $40k per bitcoin this suggests 350,000 bitcoin are lost each year to scams and theft, ignoring all other cryptocurrencies. This would take 11 years to add up to 4 million lost to user error. Testnets are good for overcoming user error. Please learn on testnets to your heart's content. 1 https://fortune.com/2017/11/25/lost-bitcoins/ https://fortune.com/2017/11/25/lost-bitcoins/ 2 https://www.cnbc.com/2022/01/06/crypto-scammers-took-a-record-14-billion-in-2021-chainalysis.html https://www.cnbc.com/2022/01/06/crypto-scammers-took-a-recor...
- leppr 5y ago
  The "lost bitcoins" figure is misleading, since most of these happened during the early days of Bitcoin when their value was low and mining outputs high. Little care was taken about backing up wallets, many have simply been abandoned. The new users of 2021 did not handle thousands of Bitcoins. A relevant comparison should rely on surveys realized in recent years, where crypto holdings represent significant monetary value for most participants and where tooling has improved to be slightly safer. As such, I'm not convinced that your conclusion is right. And if we add "lost gambling on cashgrab investments" to the scam category, I'm fairly sure it is wrong. From experience prowling many crypto developer communities, everyone in the field discusses investments at some point, so as a user you cannot avoid building an understanding of those mechanics as well.
  - magicjosh 5y ago
    Good point let's factor that in. Let's say 4% per hear or 1,500 Bitcoins are lost per day as of 2020 (crappy sources but let's use them as an example) (1)(2). That puts us at 547,000 Bitcoin lost per year compared to 350,000 from scams across all cryptocurrencies. (1) https://coinquora.com/bitcoin-supply-loses-1500-coins-per-day-says-crypto-analyst/ https://coinquora.com/bitcoin-supply-loses-1500-coins-per-da... (2) https://static1.squarespace.com/static/5d580747908cdc0001e6792d/t/5e98dde5558a587a09fac0cc/1587076583519/research+note+4.17.pdf https://static1.squarespace.com/static/5d580747908cdc0001e67...
    - leppr 5y ago
      This piece cites the exact same article you linked in your previous reply as the source used to come up with their number. Same issue.
      - magicjosh 5y ago
        To be clear the paper claims they developed their own methodology. And that this methodology lines up with the previous source: "This figure is consistent with research conducted by Ratliff in 2014 (n. 5) and Chainalysis in 2017.6" Whether you want to believe them is another issue, may simply be that they took the source and built a curve around it. Happy for any other sources or surveys you care to share. It sounds like you think scams and user error are not equivalent. Let's say user error losses are 150 bitcoin per day instead. That would suggest scams are 10X losses from user error.
Animats 5y ago
Learning to operate in an adversarial environment should be an integral part of any crypto education. So you need a testnet to debug your attacks?
- leppr 5y ago
  If you're trying to craft attacks you should execute them on a private network and not the public testnets, as people monitor the testnets and will copy your attacks if they see you exploiting the corresponding testnet contract of a mainnet dApp. I suppose that means the testnets are already a kind of adversarial environment.

by leppr 5y ago

magicjosh 5y ago

User error is an order of magnitude more dangerous than scams. Estimates suggest 4 million bitcoin are lost due to user error [1]. Estimates also suggest $14B per year of cryptocurrency is lost to scams. [2] At $40k per bitcoin this suggests 350,000 bitcoin are lost each year to scams and theft, ignoring all other cryptocurrencies. This would take 11 years to add up to 4 million lost to user error. Testnets are good for overcoming user error. Please learn on testnets to your heart's content. 1 https://fortune.com/2017/11/25/lost-bitcoins/ https://fortune.com/2017/11/25/lost-bitcoins/ 2 https://www.cnbc.com/2022/01/06/crypto-scammers-took-a-record-14-billion-in-2021-chainalysis.html https://www.cnbc.com/2022/01/06/crypto-scammers-took-a-recor...

leppr 5y ago
The "lost bitcoins" figure is misleading, since most of these happened during the early days of Bitcoin when their value was low and mining outputs high. Little care was taken about backing up wallets, many have simply been abandoned. The new users of 2021 did not handle thousands of Bitcoins. A relevant comparison should rely on surveys realized in recent years, where crypto holdings represent significant monetary value for most participants and where tooling has improved to be slightly safer. As such, I'm not convinced that your conclusion is right. And if we add "lost gambling on cashgrab investments" to the scam category, I'm fairly sure it is wrong. From experience prowling many crypto developer communities, everyone in the field discusses investments at some point, so as a user you cannot avoid building an understanding of those mechanics as well.
- magicjosh 5y ago
  Good point let's factor that in. Let's say 4% per hear or 1,500 Bitcoins are lost per day as of 2020 (crappy sources but let's use them as an example) (1)(2). That puts us at 547,000 Bitcoin lost per year compared to 350,000 from scams across all cryptocurrencies. (1) https://coinquora.com/bitcoin-supply-loses-1500-coins-per-day-says-crypto-analyst/ https://coinquora.com/bitcoin-supply-loses-1500-coins-per-da... (2) https://static1.squarespace.com/static/5d580747908cdc0001e6792d/t/5e98dde5558a587a09fac0cc/1587076583519/research+note+4.17.pdf https://static1.squarespace.com/static/5d580747908cdc0001e67...
  - leppr 5y ago
    This piece cites the exact same article you linked in your previous reply as the source used to come up with their number. Same issue.
    - magicjosh 5y ago
      To be clear the paper claims they developed their own methodology. And that this methodology lines up with the previous source: "This figure is consistent with research conducted by Ratliff in 2014 (n. 5) and Chainalysis in 2017.6" Whether you want to believe them is another issue, may simply be that they took the source and built a curve around it. Happy for any other sources or surveys you care to share. It sounds like you think scams and user error are not equivalent. Let's say user error losses are 150 bitcoin per day instead. That would suggest scams are 10X losses from user error.

Animats 5y ago

Learning to operate in an adversarial environment should be an integral part of any crypto education. So you need a testnet to debug your attacks?

leppr 5y ago
If you're trying to craft attacks you should execute them on a private network and not the public testnets, as people monitor the testnets and will copy your attacks if they see you exploiting the corresponding testnet contract of a mainnet dApp. I suppose that means the testnets are already a kind of adversarial environment.