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The beauty of crypto is that those tools are exposed and not required, and that the underlying rules are universal. Banks and custodial services built off of sh

The beauty of crypto is that those tools are exposed and not required, and that the underlying rules are universal. Banks and custodial services built off of shared liability, insurance, reversions, any useful thing a bank does are still possible with crypto - in fact they aren't even that complicated. The difference is that while allowing a (properly set up) crypto bank to transfer funds you may also at any point and for any reason take full custody over your coins. The private key which enables that should not be used for anything other than emergency (minimize attack surface) and keeping such a key secure is not all that difficult. With this combination you get all the benefits of a normal bank yet they are powerless without express authorization to do anything with your funds. You can withdraw at any point for any reason. Services and practices securing your private key will need to be widespread before adoption seriously takes off. Storing a seed phrase in your sock drawer is not acceptable: Vitalik Buterin secured his billions via two physical pieces of paper which summed to his private key; surely a step in the right direction. An n of m scheme with each n being held by parties unlikely to collaborate is another solution. This is all not even mentioning massive private banking and its relationship to the economy and bias towards the wealthy. Crypto is FOSS finance, it works for the people as stated and expected. As I said, you are correct - using your layer 1 sovereign access for everyday use is a security blunder - you now know where progress points.

Tijdreiziger 5y ago
> Crypto is FOSS finance, it works for the people as stated and expected. A laughable statement in the face of crypto’s negative externalities. We’ll wreck the planet we all share, but at least we’ll have FOSS finance!
- mattwilsonn888 5y ago
  If you're going to indiscriminately start beheading technology which uses energy why not start with vehicles, video games, machine learning, or anything at all? Its because in order to ask whether something should use energy you must first ask whether its worth it, and your sophistication when it comes to crypto-currencies, finance, and economics is too weak to have that conversation: ergo, you resort to zero value, which is hilariously inept.
  - FridgeSeal 5y ago
    Because vehicles bring value (transport people, food, resources, etc) and have energy optimisations (mass transit, electric, etc) because the energy use as a gatekeeper is not an inherent part of its functionality. I’d be shocked if video games as an industry outranked crypto for energy use. Even if we assume all gamers run their GPU’s at 100% the entire time they play games, miners will quickly dwarf the energy usage because games don’t play 24/7. Machine Learning is computationally expensive, but unlike crypto, is basically constantly trying to make their systems faster and more efficient all the time. Again-computation isn’t used as a gatekeeper here. There’s no “hash this pointlessly until enough work as been done so you can do x”, it’s just “do this work as quickly and efficiently as possible”. Things like TPU’s in ML aren’t a threat or arms race, they’re a net improvement. Crypto gets targeted for its energy use because it uses an insane amount of energy for even the most rudimentary functions. Even if current payment processors use the same amount of energy right now as crypto does, you have to consider the relative scales: those payment processors handle the vast, vast majority of payments with that energy; scaling current crypto up to that levels would bring its energy use to astronomical levels.
    - benoketamad 5y ago
      Well, fiat money has no backing whatsoever. A while ago the USD was backed by gold, nowadays it is backed by faith, just like any other fiat currency. Let this sink in: crypto is money that is backed by energy. Finally a money that is backed by some tangible thing. The systems providing it might be suboptimal, but the basic premise, that this is finally backed by a universally accepted thing, energy, is absolutely perfect. Just like coal is concentrated sunlight, crypto money is concentrated energy. Thassal.
      - FridgeSeal 5y ago
        Unfortunately I think I'd still prefer to have the energy, rather than the imaginary internet tokens, because once again, at least the energy is...useful.
        5y ago
- dropnerd 5y ago
  i suspect that proof of stake cryptotokens at scale will consume less energy than video games and machine learning.
  - Tijdreiziger 5y ago
    Ethereum has been ‘close’ to going PoS for years now, but I will certainly celebrate the day it happens. Bitcoin… do they even have any plans to move to PoS? In short, I’ll believe it when I see it. I certainly hope you’re right, though.
    - dropnerd 5y ago
      bitcoin is not going to pos. it'll either become too big to fail via lobbying or it will run into significant headwinds. maybe it will require pow regulation to change the risk-reward calculation for eth to finalize its transition to pos.
blacksheep720 5y ago
This is one of the clearest framings I’ve seen on this concept. Exactly right: blockchains and crypto tokens are simply primitive tools that institutions and organizations can be built on top of. Most crypto critics either don’t understand this, or are willfully ignorant when constructing their critiques.
dropnerd 5y ago
> An n of m scheme with each n being held by parties unlikely to collaborate is another solution. there are two way to do this currently- multisig wallets and shamir's secret sharing algorithm. multisig wallet is more widely supported. Gnosis Safe is a popular implementation, but requires multiple transactions per final action. shamir's secret sharing allows splitting the secret off-chain, which means you only pay gas once. it's hard to find a safe implementation and be confident that it works correctly.

Tijdreiziger 5y ago

> Crypto is FOSS finance, it works for the people as stated and expected. A laughable statement in the face of crypto’s negative externalities. We’ll wreck the planet we all share, but at least we’ll have FOSS finance!

mattwilsonn888 5y ago
If you're going to indiscriminately start beheading technology which uses energy why not start with vehicles, video games, machine learning, or anything at all? Its because in order to ask whether something should use energy you must first ask whether its worth it, and your sophistication when it comes to crypto-currencies, finance, and economics is too weak to have that conversation: ergo, you resort to zero value, which is hilariously inept.
- FridgeSeal 5y ago
  Because vehicles bring value (transport people, food, resources, etc) and have energy optimisations (mass transit, electric, etc) because the energy use as a gatekeeper is not an inherent part of its functionality. I’d be shocked if video games as an industry outranked crypto for energy use. Even if we assume all gamers run their GPU’s at 100% the entire time they play games, miners will quickly dwarf the energy usage because games don’t play 24/7. Machine Learning is computationally expensive, but unlike crypto, is basically constantly trying to make their systems faster and more efficient all the time. Again-computation isn’t used as a gatekeeper here. There’s no “hash this pointlessly until enough work as been done so you can do x”, it’s just “do this work as quickly and efficiently as possible”. Things like TPU’s in ML aren’t a threat or arms race, they’re a net improvement. Crypto gets targeted for its energy use because it uses an insane amount of energy for even the most rudimentary functions. Even if current payment processors use the same amount of energy right now as crypto does, you have to consider the relative scales: those payment processors handle the vast, vast majority of payments with that energy; scaling current crypto up to that levels would bring its energy use to astronomical levels.
  - benoketamad 5y ago
    Well, fiat money has no backing whatsoever. A while ago the USD was backed by gold, nowadays it is backed by faith, just like any other fiat currency. Let this sink in: crypto is money that is backed by energy. Finally a money that is backed by some tangible thing. The systems providing it might be suboptimal, but the basic premise, that this is finally backed by a universally accepted thing, energy, is absolutely perfect. Just like coal is concentrated sunlight, crypto money is concentrated energy. Thassal.
    - FridgeSeal 5y ago
      Unfortunately I think I'd still prefer to have the energy, rather than the imaginary internet tokens, because once again, at least the energy is...useful.
      - 5y ago
dropnerd 5y ago
i suspect that proof of stake cryptotokens at scale will consume less energy than video games and machine learning.
- Tijdreiziger 5y ago
  Ethereum has been ‘close’ to going PoS for years now, but I will certainly celebrate the day it happens. Bitcoin… do they even have any plans to move to PoS? In short, I’ll believe it when I see it. I certainly hope you’re right, though.
  - dropnerd 5y ago
    bitcoin is not going to pos. it'll either become too big to fail via lobbying or it will run into significant headwinds. maybe it will require pow regulation to change the risk-reward calculation for eth to finalize its transition to pos.

blacksheep720 5y ago

This is one of the clearest framings I’ve seen on this concept. Exactly right: blockchains and crypto tokens are simply primitive tools that institutions and organizations can be built on top of. Most crypto critics either don’t understand this, or are willfully ignorant when constructing their critiques.

dropnerd 5y ago

> An n of m scheme with each n being held by parties unlikely to collaborate is another solution. there are two way to do this currently- multisig wallets and shamir's secret sharing algorithm. multisig wallet is more widely supported. Gnosis Safe is a popular implementation, but requires multiple transactions per final action. shamir's secret sharing allows splitting the secret off-chain, which means you only pay gas once. it's hard to find a safe implementation and be confident that it works correctly.