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The sole purpose of blockchain is to prevent double spending without a trusted party Other proposed applications are mostly dumb / misguided, like immutable st

The sole purpose of blockchain is to prevent double spending without a trusted party Other proposed applications are mostly dumb / misguided, like immutable storage, social network posts, etc, these can be done with hashing or digital signatures alone If you have a better way to avoid double spending than blockchain folks woukd get very excited. Traditional database can’t do that (requires a trusted party)

ASalazarMX 5y ago
The current Mexican government is trying to take control of elections, banana republic style, from the INE, the independent institution in charge of those. Our president is suggesting blockchain tech to make votes electronic, and defunding the INE since physical votes won't be needed anymore. A blockchain would not guarantee fair elections, is just a buzzword.
TimJRobinson 4y ago
How do you build Alchemix with a hashing / digital signature algorithm? How about Uniswap? Balancer? Curve? Aave? Don't know these names? Together they hold over $100B in assets. It's crazy how out of touch with what's going on in DeFi HN is. That you can say there is nothing useful meanwhile there are tens of thousands of people using billions of dollars with these apps all of which depend on a Blockchain to function.
goldenbikeshed 4y ago
See that's the point. Having a trusted party is a better solution.
Fnoord 4y ago
I have a better way: with a trusted party. Seriously. And if these suck, then perhaps there's not enough competition between them. I mean, Mastercard and Visa is practically a duopoly, and while a duopoly is better than a monopoly, it still sucks. I also know a good use case for blockchain: scamming. Practically all the current use cases revolve around that. The trusted party wasn't so bad after all, eh? But to be honest, I feel like there's one good use case for cryptocurrencies which isn't a use case for me, but is for people who live in oppressed regimes: the ability to not use the currency of the autocratic government. This would be true for some South American countries, but also nowadays for a country like Russia. Other than that, I see no use case.
Niksko 5y ago
Without a single trusted party. You're trading trust for one entity for trust for many entities.
- Aeolun 5y ago
  I dunno, the good thing about single entities is that it’s fairly easy to determine if you should trust them. A web of entities of varying integrity, not so much.
- throwawayh878 5y ago
  I don't think I have to trust anyone when I run my own Bitcoin node and sign transactions. What entities do you mean?
  - mikepurvis 5y ago
    Your hardware and software vendors, and the people who secured your OS and your physical premises.
  - hypertele-Xii 5y ago
    You have to trust the people who figured out the math, when they say "this math is secure". Then you have to trust the people who programmed that math, when they say "this code implements this math correctly". And then you have to trust the binary, unless you compiled it yourself, when it says "this binary compiles this code correctly", and finally you have to trust the machines when they say "this computer executes this binary correctly", all the while trusting youself not to have made any mistakes at any step which will quickly cost you everything you put into the system. If you are an expert mathematician, programmer, electrical engineer, and white hat you might not have to trust anyone else. How many people are all of these though?
    - ahtihn 5y ago
      > You have to trust the people who figured out the math, when they say "this math is secure". Not really. I'm convinced the math is secure given the current knowledge, because there's a massive financial incentive to break it. I don't have to trust anyone.
xupybd 5y ago
Hard to tamper with data loggers also benefit from the Blockchain. There are lots of industries where tamper proof records are valuable and record keeping is distributed.
- elsjaako 5y ago
  I get the value of having a chain of "blocks" of data, but that could also describe git. I don't see the added value of proof of work or proof of stake here. Why isn't putting that data (or a hash of it) in a publicly available git repository just as good? You can even publish the newest branch hash in the newspaper everyday if you want.
  - xupybd 5y ago
    Oh in this instance it's not about having a public record. It's about every transaction having a hash of the previous. Then it gets hard to forge old data without altering all records after the forgery. It's still possible but takes more work and can make the tampering easier to discover. And for data loggers not connected to the internet this helps. It would be just as good to put it in a central repo if there was an internet connection available. But if you're logging a refrigerator temp on a container traveling between countries there isn't going to be a cheap option for internet.
    - FabHK 5y ago
      > It's about every transaction having a hash of the previous. We understand that... GP even said: >> I get the value of having a chain of "blocks" of data
    - gravitycorn 5y ago
      Wait, you never did a git rebase? How does a consensus algorithm help when the nodes are not connected to the p2p network?
      - blablabla123 5y ago
FabHK 5y ago
> The sole purpose of blockchain is to prevent double spending without a trusted party. Yes, and avoiding the trusted party makes it more inefficient by a factor of around 100,000,000 (-ish), if you consider that BTC uses around 23 GW and can do no more (5 transactions a second) than a single trusted PC could do. What are use cases were you actually need this and the high cost is worth it?
- paulsutter 5y ago
  The power is used to secure the system, not to perform transactions. The transaction rate has always been the same, the power use has gone up with the value of the contents (to resist a 51% attack) Some people feel strongly this security is worth it. Some feel strongly that it isn’t (but one suspects their objection is really to the lack of central control)
  - 2muchcoffeeman 5y ago
    Climate change may be the problem that defines our generation. In that light, and given the ludicrous power estimates that blockchains use, are we not morally obligated to kill all the blockchain projects if these estimates are in the right ballpark?
    - lostmsu 5y ago
      Only if you believe climate change defines this generation.
    - Tenoke 5y ago
      At most we might be obliged to kill the worst (and a lot of other non-crypto things) but killing all makes no sense when there's many with fairly neglible impact.
      - woodruffw 5y ago
        Nature abhors a vacuum: if you kill the most popular PoW scheme, the little ones will dutifully step up and use just as much power. I don’t think there’s any world we can live in where PoW schemes will have “negligible impact,” which only heartens the justification for banning all of them, now.
YetAnotherNick 5y ago
Preventing double spending is possible even without trust. A centralised authority could publish the transactions in a signed append only log. Independent verifiers could pull the log with some frequency and verify that no one spent twice.
- paulsutter 5y ago
  Good point - blockchain also prevents transaction censorship (your proposal prevents double spend but allows the central authority to block transactions) Central authorities might do wild stuff like block Folks They Don’t Like (certain truck drivers, etc). Some people think that’s really good, others feel the opposite (edited for clarity)
  - mytherin 5y ago
    If the miners don’t like you what stops them from not including your transactions in the chain? It is my understanding that if a large enough pool of miners decides they don’t like you (>50%) they can completely prevent your ability to spend money.
    - tromp 5y ago
      > what stops them from not including your transactions in the chain The only thing that could stop them is being unable to identify what outputs belong to you. Which generally requires a more privacy focussed design than what Bitcoin offers.
  - csydas 5y ago
    Can you expand on this a bit? Which element regarding censorship does Blockchain help prevent? I ask earnestly as it feels like a forgone conclusion but depending on what you refer to I'm not sure it is. My initial thought is about freedom of spending and transactions as a concept of the chain but I guess it's not exactly censorship in the most common sense.
    - tgsovlerkhgsel 5y ago
yashg 5y ago
>The sole purpose of blockchain is to prevent double spending without a trusted party That is most accurate description of blockchain I have read. Unfortunately, the mechanism for that (Proof-of-work) is slow, expensive and planet destroying at scale. And while we may remove a trust provider third party, we aren't getting rid of centralization with blockchain anyway.
- noxer 5y ago
  PoW is not needed at all its just a puzzle do "randomizes" who can write the next block. Its comically inefficient and p much the worst known working solution. Some BTC devs realized this and created Federated Byzantine Agreement (FBA) which used Byzantine Agreement rather than a puzzle to created the consensus and then federated the whole system to prevent 51%-like attacks. Obviously if the peers work together with the goal to reach consensus based on fix rules it becames way more efficient. Only a few year after bitcoin this was already invented theoretically and shortly after build an went online 2012/13. It essentially depreciated PoW (and Bitcoin) long before all the BTC clones existed and even before ETH. People just tend to stick to "the first of something" and fight whatever comes after. tl;dr The secret sauce of blockchain is not PoW, its a public state of a ledger that can be verified to be correct by anyone without trusting anyone simply by applying the rules of the system yourself.
  - MacsHeadroom 5y ago
    PoW is needed for the "trustless" qualifier. Other schemes like PoS can be very low trust but not fully trustless. They also tend towards ever increasing centralization.
    - noxer 4y ago
      No, its really not. It is literally just a puzzle which solves the "problem" as to who gets to write the next block. Instead if you define the rules for the next block as strict as possible so it essentially eliminates a huge variety of possible blocks, participants can instead easily agree on one (the best) block (one that follows all rules and is objectionably better than all other possible blocks). There is no need to "fight" over who can add that block, agreeing is way more efficient. And Consequentially the puzzle is no longer needed. PoS is not what I'm talking about at all. PoS just replaces the PoW puzzle with a "virtual puzzle" that acts as if higher stakes are higher hash power thus more chance to win the puzzle. Other than that its still the same "fight" over who gets to write the next block. PoW and PoS at scale leads to more centralization over time because of the economy of scale principle. While FBA (Federated Byzantine Agreement) leads to more decentralization because its in everyones interest to increase the number of participants, they are helping the system not competing.
mypastself 5y ago
I’ve read several technical, non-fluff books on the topic, and I’ve developed smart contracts on Ethereum for decent hourly wage (paid out in fiat). And I’ve still come to roughly the same conclusion as you. Either my reading comprehension is poor, or there is little actual value in the vast majority of blockchain applications. Digital cash, as defined in the Bitcoin whitepaper, still seems like the only real use case. Other uses are fun for a developer to read and learn about, but that’s just about the only real value you can extract from them. Well, and making quick developer buck, which is the equivalent of selling shovels to prospectors in a gold rush. The main difference being that it’s merely a jpeg of a shovel.
- pcthrowaway 5y ago
  If you've developed smart contracts, I'm surprised you don't consider the capability of trustless financial instruments (peer-to-peer lending and pooled lending, for example) to be pretty useful as well
  - lmohseni 5y ago
    If you’ve ever written code, and if you’ve ever written a bug, then you will understand that code as law is terrible idea, especially when it comes to finance.
    - kingkool68 5y ago
      Exhibit A https://twitter.com/0xfoobar/status/1517680400142716929?s=21&t=TNcpruuS6Q2DXoftSnkb6w https://twitter.com/0xfoobar/status/1517680400142716929?s=21...
      - cableshaft 5y ago
        Yikes. Wasn't aware of that one. Thanks for sharing it. I like smart contracts but you really have to be super careful with them, and ideally they should all be audited by a third party before launch, to help catch stuff like this. But even that's not a guarantee crap like this won't happen sometimes.
FabHK 5y ago
(where blockchain here is used in the sense of a public blockchain plus a consensus mechanism such as PoW)
ak_111 5y ago
This is sensible take, and arguably backed by the fact that apart from bitcoin there are no other examples of practical blockchain tech.
jl6 5y ago
> The sole purpose of blockchain is to prevent double spending without a trusted party I would add that in nearly all cases it is totally reasonable to have a trusted party, and therefore that the value of the blockchain collapses down to a very, very small number of use cases (the ones that we all know about - fraud, extortion, money laundering, tax avoidance).
- pirate787 5y ago
  To be fair, also asset transfer out of authoritarian monetary regimes.
  - deebosong 5y ago
    If I may inquire... could there be a better way to do this that's not blockchain tech? It's a noble cause, for sure. Like, viscerally most people will automatically agree with this cause. But to prop up the entirety of cryptocurrency's shortcomings for this one thing... seems like.. it would make more sense... to just make a product/ technology that simply addresses this one use case that everyone by and large agrees is a good thing... nah?
ninkendo 5y ago
It tracks double spends of cryptocurrency on the blockchain, which is only as useful as the currency itself is. Since BTC/ETH/etc is only “valuable” because of wild speculation and greater fools, the “value” part kind of collapses, leaving the “currency” aspect moot. Which brings us back to “no value”.
- baby 5y ago
  Stablecoins
stkdump 5y ago
A database does this. The trusted party isn't eliminated by blockchain, because someone has to code the implementation of the software. Unless you checked the software for bugs or backdoors camouflaged as bugs and compile it yourself, you trust someone else. The trust 'problem' is overrated, because nothing in this world works without trust.
- baby 5y ago
  You’re wrong because you’re talking about database when we’re talking about distributed databases.
  - hurflmurfl 5y ago
    > You're wrong Can I just say, on a rather unrelated note, that this just sounds very toxic and will trigger most people into "defense mode". I understand that "wrong" thoughts and opinions don't come out of nowhere, someone must have produced them, but it just reads so much nicer when the attack is explicitly targeting the opinion, and not the author. In your other comments in this very thread you're using "Your comment goes in all directions...", "Your example is implemented in...". This is so much nicer! Thanks for going the extra mile! Let's keep the discussion going and reduce the chances of someone getting triggered and starting a flame war.
    - baby 5y ago
      Reading all the comments here is infuriating
- petesergeant 5y ago
  I'm blockchain skeptical, but I think you're slightly throwing out the baby with the bathwater here. > the trusted party isn't eliminated by blockchain, because someone has to code the implementation of the software I don't think is relevant in practice, and I think the blockchain does solve this problem regarding double-spending. Yes, there's a centralized set of developers, but that does not seem to be a problem in practice, 13 years in > The trust 'problem' is overrated, because nothing in this world works without trust. Bingo, this is the real problem. The world has very few problems where a trusted authority / arbitrator isn't a massive benefit.
andreskytt 5y ago
To be more precise, the nature of trust shifts. In case of a central database, one must trust the organization running the database. In case of blockchain you need to trust the math behind it, its implementation _and_ that the network structure preserves the assumptions the math makes. This might be preferable for some but not for others.
- baby 5y ago
  The trust shift to a lower layer, which is always what you want to unless this adds a huge amount of overhead or complexity that leads to security issues. In our case it looks like blockchains are solving real world problems.
  - angryasian 5y ago
    you keep repeating this mantra, but this is exactly what Op is asking... what problem is it really solving. Its not solving a tech problem, because the tech exists.
    - baby 5y ago
      It is solving a tech problem because the tech exist you mean
giantg2 5y ago
"The sole purpose of blockchain is to prevent double spending without a trusted party" I agree with this. I would add that by removing the need for a trusted party, it can increase speed. For example, stock trades are currently T+2 to handle settlement through the various institutions. There is a push to start using blockchain to speed it up to T+1 or faster.
dropnerd 5y ago
immutable storage must come with an incentive layer or no one would serve the files. for piracy, it was private tracker seed ratio. for web3, it's either on a blockchain or ipfs/arweave. it's not a good fit for most applications, but when you want a file to probabilistically last forever, now there are options.
throw0101a 5y ago
> The sole purpose of blockchain is to prevent double spending without a trusted party NIST's Blockchain Technology Overview is really good explainer: * https://csrc.nist.gov/publications/detail/nistir/8202/final https://csrc.nist.gov/publications/detail/nistir/8202/final See especially Figure 6 ("p. 42", 53 of the PDF), which is a flow chart to help you decide on whether blockchain matches one's use case. Extracted: * https://imgur.com/a/RlUj9Ed https://imgur.com/a/RlUj9Ed
- geoduck14 5y ago
  I love it: Do you need <something you almost certainly don't need>? No -> consider DATABASE
  - nsotelo 5y ago
    Future historians will laugh and cry knowing we invested trillions and boiled the oceans for the sake of a useless append-only log.
    - smitty1e 5y ago
      It was shiny.
phkahler 5y ago
>> Other proposed applications are mostly dumb / misguided, That is the key. Crypto currency is a thing. I don't think that has a future either but whatever. All other uses are just hype and those applications make no sense except to fool investors.
smitty1e 5y ago
I thought that the blockchain (itself) afforded some anonymity, while still preserving trust, through cryptographic signing. Which sounded beautiful, until I realized that there must needs still be some other market around the blockchain, in order to interface with reality and older currency systems. There, all privacy bets are off. Thus, even if one wanted to conduct and election, and put all votes on a block chain, maintaining a secret ballot seems impossible, as far as I can tell. Sometimes, a primitive solution like a paper ballot has crucial superior aspects.
nivertech 5y ago
Blockchain (or more correctly "hashchain"[1] data structure) doesn't solve the double spend problem, because anyone can create a new entry with a hashpointer pointing to the last entry (aka "block") with transactions. This problem is inherent in all Nakamoto Consensus style implementations (basically Leader Election algorithms), not just Bitcoin's PoW. Simpler: anyone can fork the blockchain and over-write the ledger with the new transactions. So in reality the double spend solved by the social consensus on the right fork, not by technological solutions. EDIT: Leaving aside the question of transaction finality and probabilistic nature of the Nakamoto Consensus, which making it even worse. -- [1] https://en.wikipedia.org/wiki/Hash_chain https://en.wikipedia.org/wiki/Hash_chain
unbalancedparen 5y ago
That is the main purpose. But check SNARKs and STARKs, they have a great future outside of blockchain too.

ASalazarMX 5y ago

The current Mexican government is trying to take control of elections, banana republic style, from the INE, the independent institution in charge of those. Our president is suggesting blockchain tech to make votes electronic, and defunding the INE since physical votes won't be needed anymore. A blockchain would not guarantee fair elections, is just a buzzword.

TimJRobinson 4y ago

How do you build Alchemix with a hashing / digital signature algorithm? How about Uniswap? Balancer? Curve? Aave? Don't know these names? Together they hold over $100B in assets. It's crazy how out of touch with what's going on in DeFi HN is. That you can say there is nothing useful meanwhile there are tens of thousands of people using billions of dollars with these apps all of which depend on a Blockchain to function.

goldenbikeshed 4y ago

See that's the point. Having a trusted party is a better solution.

Fnoord 4y ago

I have a better way: with a trusted party. Seriously. And if these suck, then perhaps there's not enough competition between them. I mean, Mastercard and Visa is practically a duopoly, and while a duopoly is better than a monopoly, it still sucks. I also know a good use case for blockchain: scamming. Practically all the current use cases revolve around that. The trusted party wasn't so bad after all, eh? But to be honest, I feel like there's one good use case for cryptocurrencies which isn't a use case for me, but is for people who live in oppressed regimes: the ability to not use the currency of the autocratic government. This would be true for some South American countries, but also nowadays for a country like Russia. Other than that, I see no use case.

Niksko 5y ago

Without a single trusted party. You're trading trust for one entity for trust for many entities.

Aeolun 5y ago
I dunno, the good thing about single entities is that it’s fairly easy to determine if you should trust them. A web of entities of varying integrity, not so much.
throwawayh878 5y ago
I don't think I have to trust anyone when I run my own Bitcoin node and sign transactions. What entities do you mean?
- mikepurvis 5y ago
  Your hardware and software vendors, and the people who secured your OS and your physical premises.
- hypertele-Xii 5y ago
  You have to trust the people who figured out the math, when they say "this math is secure". Then you have to trust the people who programmed that math, when they say "this code implements this math correctly". And then you have to trust the binary, unless you compiled it yourself, when it says "this binary compiles this code correctly", and finally you have to trust the machines when they say "this computer executes this binary correctly", all the while trusting youself not to have made any mistakes at any step which will quickly cost you everything you put into the system. If you are an expert mathematician, programmer, electrical engineer, and white hat you might not have to trust anyone else. How many people are all of these though?
  - ahtihn 5y ago
    > You have to trust the people who figured out the math, when they say "this math is secure". Not really. I'm convinced the math is secure given the current knowledge, because there's a massive financial incentive to break it. I don't have to trust anyone.

xupybd 5y ago

Hard to tamper with data loggers also benefit from the Blockchain. There are lots of industries where tamper proof records are valuable and record keeping is distributed.

elsjaako 5y ago
I get the value of having a chain of "blocks" of data, but that could also describe git. I don't see the added value of proof of work or proof of stake here. Why isn't putting that data (or a hash of it) in a publicly available git repository just as good? You can even publish the newest branch hash in the newspaper everyday if you want.
- xupybd 5y ago
  Oh in this instance it's not about having a public record. It's about every transaction having a hash of the previous. Then it gets hard to forge old data without altering all records after the forgery. It's still possible but takes more work and can make the tampering easier to discover. And for data loggers not connected to the internet this helps. It would be just as good to put it in a central repo if there was an internet connection available. But if you're logging a refrigerator temp on a container traveling between countries there isn't going to be a cheap option for internet.
  - FabHK 5y ago
    > It's about every transaction having a hash of the previous. We understand that... GP even said: >> I get the value of having a chain of "blocks" of data
  - gravitycorn 5y ago
    Wait, you never did a git rebase? How does a consensus algorithm help when the nodes are not connected to the p2p network?
    - blablabla123 5y ago

FabHK 5y ago

> The sole purpose of blockchain is to prevent double spending without a trusted party. Yes, and avoiding the trusted party makes it more inefficient by a factor of around 100,000,000 (-ish), if you consider that BTC uses around 23 GW and can do no more (5 transactions a second) than a single trusted PC could do. What are use cases were you actually need this and the high cost is worth it?

paulsutter 5y ago
The power is used to secure the system, not to perform transactions. The transaction rate has always been the same, the power use has gone up with the value of the contents (to resist a 51% attack) Some people feel strongly this security is worth it. Some feel strongly that it isn’t (but one suspects their objection is really to the lack of central control)
- 2muchcoffeeman 5y ago
  Climate change may be the problem that defines our generation. In that light, and given the ludicrous power estimates that blockchains use, are we not morally obligated to kill all the blockchain projects if these estimates are in the right ballpark?
  - lostmsu 5y ago
    Only if you believe climate change defines this generation.
  - Tenoke 5y ago
    At most we might be obliged to kill the worst (and a lot of other non-crypto things) but killing all makes no sense when there's many with fairly neglible impact.
    - woodruffw 5y ago
      Nature abhors a vacuum: if you kill the most popular PoW scheme, the little ones will dutifully step up and use just as much power. I don’t think there’s any world we can live in where PoW schemes will have “negligible impact,” which only heartens the justification for banning all of them, now.

YetAnotherNick 5y ago

Preventing double spending is possible even without trust. A centralised authority could publish the transactions in a signed append only log. Independent verifiers could pull the log with some frequency and verify that no one spent twice.

paulsutter 5y ago
Good point - blockchain also prevents transaction censorship (your proposal prevents double spend but allows the central authority to block transactions) Central authorities might do wild stuff like block Folks They Don’t Like (certain truck drivers, etc). Some people think that’s really good, others feel the opposite (edited for clarity)
- mytherin 5y ago
  If the miners don’t like you what stops them from not including your transactions in the chain? It is my understanding that if a large enough pool of miners decides they don’t like you (>50%) they can completely prevent your ability to spend money.
  - tromp 5y ago
    > what stops them from not including your transactions in the chain The only thing that could stop them is being unable to identify what outputs belong to you. Which generally requires a more privacy focussed design than what Bitcoin offers.
- csydas 5y ago
  Can you expand on this a bit? Which element regarding censorship does Blockchain help prevent? I ask earnestly as it feels like a forgone conclusion but depending on what you refer to I'm not sure it is. My initial thought is about freedom of spending and transactions as a concept of the chain but I guess it's not exactly censorship in the most common sense.
  - tgsovlerkhgsel 5y ago

yashg 5y ago

>The sole purpose of blockchain is to prevent double spending without a trusted party That is most accurate description of blockchain I have read. Unfortunately, the mechanism for that (Proof-of-work) is slow, expensive and planet destroying at scale. And while we may remove a trust provider third party, we aren't getting rid of centralization with blockchain anyway.

noxer 5y ago
PoW is not needed at all its just a puzzle do "randomizes" who can write the next block. Its comically inefficient and p much the worst known working solution. Some BTC devs realized this and created Federated Byzantine Agreement (FBA) which used Byzantine Agreement rather than a puzzle to created the consensus and then federated the whole system to prevent 51%-like attacks. Obviously if the peers work together with the goal to reach consensus based on fix rules it becames way more efficient. Only a few year after bitcoin this was already invented theoretically and shortly after build an went online 2012/13. It essentially depreciated PoW (and Bitcoin) long before all the BTC clones existed and even before ETH. People just tend to stick to "the first of something" and fight whatever comes after. tl;dr The secret sauce of blockchain is not PoW, its a public state of a ledger that can be verified to be correct by anyone without trusting anyone simply by applying the rules of the system yourself.
- MacsHeadroom 5y ago
  PoW is needed for the "trustless" qualifier. Other schemes like PoS can be very low trust but not fully trustless. They also tend towards ever increasing centralization.
  - noxer 4y ago
    No, its really not. It is literally just a puzzle which solves the "problem" as to who gets to write the next block. Instead if you define the rules for the next block as strict as possible so it essentially eliminates a huge variety of possible blocks, participants can instead easily agree on one (the best) block (one that follows all rules and is objectionably better than all other possible blocks). There is no need to "fight" over who can add that block, agreeing is way more efficient. And Consequentially the puzzle is no longer needed. PoS is not what I'm talking about at all. PoS just replaces the PoW puzzle with a "virtual puzzle" that acts as if higher stakes are higher hash power thus more chance to win the puzzle. Other than that its still the same "fight" over who gets to write the next block. PoW and PoS at scale leads to more centralization over time because of the economy of scale principle. While FBA (Federated Byzantine Agreement) leads to more decentralization because its in everyones interest to increase the number of participants, they are helping the system not competing.

mypastself 5y ago

I’ve read several technical, non-fluff books on the topic, and I’ve developed smart contracts on Ethereum for decent hourly wage (paid out in fiat). And I’ve still come to roughly the same conclusion as you. Either my reading comprehension is poor, or there is little actual value in the vast majority of blockchain applications. Digital cash, as defined in the Bitcoin whitepaper, still seems like the only real use case. Other uses are fun for a developer to read and learn about, but that’s just about the only real value you can extract from them. Well, and making quick developer buck, which is the equivalent of selling shovels to prospectors in a gold rush. The main difference being that it’s merely a jpeg of a shovel.

pcthrowaway 5y ago
If you've developed smart contracts, I'm surprised you don't consider the capability of trustless financial instruments (peer-to-peer lending and pooled lending, for example) to be pretty useful as well
- lmohseni 5y ago
  If you’ve ever written code, and if you’ve ever written a bug, then you will understand that code as law is terrible idea, especially when it comes to finance.
  - kingkool68 5y ago
    Exhibit A https://twitter.com/0xfoobar/status/1517680400142716929?s=21&t=TNcpruuS6Q2DXoftSnkb6w https://twitter.com/0xfoobar/status/1517680400142716929?s=21...
    - cableshaft 5y ago
      Yikes. Wasn't aware of that one. Thanks for sharing it. I like smart contracts but you really have to be super careful with them, and ideally they should all be audited by a third party before launch, to help catch stuff like this. But even that's not a guarantee crap like this won't happen sometimes.

FabHK 5y ago

(where blockchain here is used in the sense of a public blockchain plus a consensus mechanism such as PoW)

ak_111 5y ago

This is sensible take, and arguably backed by the fact that apart from bitcoin there are no other examples of practical blockchain tech.

jl6 5y ago

> The sole purpose of blockchain is to prevent double spending without a trusted party I would add that in nearly all cases it is totally reasonable to have a trusted party, and therefore that the value of the blockchain collapses down to a very, very small number of use cases (the ones that we all know about - fraud, extortion, money laundering, tax avoidance).

pirate787 5y ago
To be fair, also asset transfer out of authoritarian monetary regimes.
- deebosong 5y ago
  If I may inquire... could there be a better way to do this that's not blockchain tech? It's a noble cause, for sure. Like, viscerally most people will automatically agree with this cause. But to prop up the entirety of cryptocurrency's shortcomings for this one thing... seems like.. it would make more sense... to just make a product/ technology that simply addresses this one use case that everyone by and large agrees is a good thing... nah?

ninkendo 5y ago

It tracks double spends of cryptocurrency on the blockchain, which is only as useful as the currency itself is. Since BTC/ETH/etc is only “valuable” because of wild speculation and greater fools, the “value” part kind of collapses, leaving the “currency” aspect moot. Which brings us back to “no value”.

baby 5y ago
Stablecoins

stkdump 5y ago

A database does this. The trusted party isn't eliminated by blockchain, because someone has to code the implementation of the software. Unless you checked the software for bugs or backdoors camouflaged as bugs and compile it yourself, you trust someone else. The trust 'problem' is overrated, because nothing in this world works without trust.

baby 5y ago
You’re wrong because you’re talking about database when we’re talking about distributed databases.
- hurflmurfl 5y ago
  > You're wrong Can I just say, on a rather unrelated note, that this just sounds very toxic and will trigger most people into "defense mode". I understand that "wrong" thoughts and opinions don't come out of nowhere, someone must have produced them, but it just reads so much nicer when the attack is explicitly targeting the opinion, and not the author. In your other comments in this very thread you're using "Your comment goes in all directions...", "Your example is implemented in...". This is so much nicer! Thanks for going the extra mile! Let's keep the discussion going and reduce the chances of someone getting triggered and starting a flame war.
  - baby 5y ago
    Reading all the comments here is infuriating
petesergeant 5y ago
I'm blockchain skeptical, but I think you're slightly throwing out the baby with the bathwater here. > the trusted party isn't eliminated by blockchain, because someone has to code the implementation of the software I don't think is relevant in practice, and I think the blockchain does solve this problem regarding double-spending. Yes, there's a centralized set of developers, but that does not seem to be a problem in practice, 13 years in > The trust 'problem' is overrated, because nothing in this world works without trust. Bingo, this is the real problem. The world has very few problems where a trusted authority / arbitrator isn't a massive benefit.

andreskytt 5y ago

To be more precise, the nature of trust shifts. In case of a central database, one must trust the organization running the database. In case of blockchain you need to trust the math behind it, its implementation _and_ that the network structure preserves the assumptions the math makes. This might be preferable for some but not for others.

baby 5y ago
The trust shift to a lower layer, which is always what you want to unless this adds a huge amount of overhead or complexity that leads to security issues. In our case it looks like blockchains are solving real world problems.
- angryasian 5y ago
  you keep repeating this mantra, but this is exactly what Op is asking... what problem is it really solving. Its not solving a tech problem, because the tech exists.
  - baby 5y ago
    It is solving a tech problem because the tech exist you mean

giantg2 5y ago

"The sole purpose of blockchain is to prevent double spending without a trusted party" I agree with this. I would add that by removing the need for a trusted party, it can increase speed. For example, stock trades are currently T+2 to handle settlement through the various institutions. There is a push to start using blockchain to speed it up to T+1 or faster.

dropnerd 5y ago

immutable storage must come with an incentive layer or no one would serve the files. for piracy, it was private tracker seed ratio. for web3, it's either on a blockchain or ipfs/arweave. it's not a good fit for most applications, but when you want a file to probabilistically last forever, now there are options.

throw0101a 5y ago

> The sole purpose of blockchain is to prevent double spending without a trusted party NIST's Blockchain Technology Overview is really good explainer: * https://csrc.nist.gov/publications/detail/nistir/8202/final https://csrc.nist.gov/publications/detail/nistir/8202/final See especially Figure 6 ("p. 42", 53 of the PDF), which is a flow chart to help you decide on whether blockchain matches one's use case. Extracted: * https://imgur.com/a/RlUj9Ed https://imgur.com/a/RlUj9Ed

geoduck14 5y ago
I love it: Do you need <something you almost certainly don't need>? No -> consider DATABASE
- nsotelo 5y ago
  Future historians will laugh and cry knowing we invested trillions and boiled the oceans for the sake of a useless append-only log.
  - smitty1e 5y ago
    It was shiny.

phkahler 5y ago

>> Other proposed applications are mostly dumb / misguided, That is the key. Crypto currency is a thing. I don't think that has a future either but whatever. All other uses are just hype and those applications make no sense except to fool investors.

smitty1e 5y ago

I thought that the blockchain (itself) afforded some anonymity, while still preserving trust, through cryptographic signing. Which sounded beautiful, until I realized that there must needs still be some other market around the blockchain, in order to interface with reality and older currency systems. There, all privacy bets are off. Thus, even if one wanted to conduct and election, and put all votes on a block chain, maintaining a secret ballot seems impossible, as far as I can tell. Sometimes, a primitive solution like a paper ballot has crucial superior aspects.

nivertech 5y ago

Blockchain (or more correctly "hashchain"[1] data structure) doesn't solve the double spend problem, because anyone can create a new entry with a hashpointer pointing to the last entry (aka "block") with transactions. This problem is inherent in all Nakamoto Consensus style implementations (basically Leader Election algorithms), not just Bitcoin's PoW. Simpler: anyone can fork the blockchain and over-write the ledger with the new transactions. So in reality the double spend solved by the social consensus on the right fork, not by technological solutions. EDIT: Leaving aside the question of transaction finality and probabilistic nature of the Nakamoto Consensus, which making it even worse. -- [1] https://en.wikipedia.org/wiki/Hash_chain https://en.wikipedia.org/wiki/Hash_chain

unbalancedparen 5y ago

That is the main purpose. But check SNARKs and STARKs, they have a great future outside of blockchain too.