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There are many flaws in this perspective, but I'll pick one: the argument that there is no problem being solved with blockchain. This is trivially falsifiable:

• randomsearch 4y ago
  > This is trivially falsifiable: blockchains are being used to facilitate illegal transactions. He literally makes this point in the article.
  • gfodor 4y ago
    I read the article and do not see this point being made. Can you point it out?
    • lolinder 4y ago
      > Someone, please show me an application where blockchain is essential. That is, a problem that could not have been solved without blockchain that can now be solved with it. (And “ransomware couldn’t exist because criminals are blocked from using the conventional financial networks, and cash payments aren’t feasible” does not count.) He's specifically calling out ransomware criminals as not counting, but I think he'd extend the logic to crime in general.
      • gfodor 4y ago
        That's not refuting my argument. My argument is that the general problem of being able to transact freely across the globe with radically reduced risk of government interception is a legitimate problem for many individuals now and in the past, who live under governments with unjust laws. Plucking one very obvious form of immoral criminality out of that gigantic pool of use cases is misleading at best. I think many people in the West forget how lucky they are that, on average, the correlation between the morality and legality of economic transactions is fairly decent.
        • n4r9 4y ago
          > the general problem of being able to transact freely across the globe with radically reduced risk of government interception is a legitimate problem for many individuals now and in the past, who live under governments with unjust laws I'm far from convinced that blockchain solves this. For a transaction system to be used in a serious and widespread manner, there must be recourse in case money is lost to fraud, hacking etc... . Currently this is typically provided by some goverment/state body regulating the system and prosecuting criminal abuse of it. I haven't seen any good arguments that cryptocurrencies can provide this kind of security without government involvement. Blockchain might provide a provisional workaround for people under unjust governments, but the long-term robust solution to me seems to be political and cultural progress, not technology.
          • gfodor 4y ago
            Technology leads norms, not the other way around. Technology doesn't dictate norms, but forces materialization of norms that otherwise wouldn't be necessary.
            • n4r9 4y ago
              There are some situations where technology forces a reassessment of norms, yes. But this is beside the point, which is that blockchain does not properly solve the problem of secure global payments. It's a stopgap, and incentivises people to design a better solution.
        • lottin 4y ago
          Someone who lives under an oppressive government is not going to be less oppressed just because they gain the ability to send digital tokens around without government interference.
          • mypastself 4y ago
            If the person purchases goods or services with, or holds said token during a period in which a government devalues or confiscates their other stores of value to a greater degree, then I think it’s fair to say they are less oppressed.
      • wuliwong 4y ago
        I think that is an unreasonable bar to set for a technology. It doesn't have to be the only way to do something to be viable. It might be the best solution for a problem but there still could exist other solutions.
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  • mypastself 4y ago
    The article merely dismisses it out of hand, though, and the comment you’re responding to offers an alternative viewpoint.
    • deleted 4y ago
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• NhanH 4y ago
  Uncensorable digital currencies are being used to facilitate illegal transactions, and amongs all the blockchains, only ONE of them started with the intention of being a currency of some sort. Yes, there is a distinction between "blockchain" and "blockchain-based currency". Most of the other bullshit blockchain could not be used for that purpose. I'm pretty sure a lot of people dismissive of blockchain, even on HN, would agree that the world is probably a whole lot better if Bitcoin is the only blockchain exist. It is a bit unfortunate that technical issue might prevent bitcoin of ever be a functional currency, but that is a different topic.
  • pclmulqdq 4y ago
    If you meant your argument about monero, it might make sense. As it stands, Bitcoin is total shit at facilitating illegal transactions.
    • rvz 4y ago
      Not sure why you are downvoted but you are totally correct on that. If Bitcoin was being used for facilitating illegal transactions, why haven't many exchanges delisted it already, or banned Bitcoin entirely? Is that why $3.6B in Bitcoin was traced up and seized by the authorities and not Monero? [0] That explains why the scammers, criminals, etc are moving to use Monero instead of Bitcoin. Once that Bitcoin gets sent to an exchange, it is game over. [0] https://arstechnica.com/information-technology/2022/02/3-6-billion-bitcoin-seizure-shows-how-hard-it-is-to-launder-cryptocurrency https://arstechnica.com/information-technology/2022/02/3-6-b...
      • pclmulqdq 4y ago
        As far as I can tell, Bitcoin maximalists don't like hearing that they are betting the farm on an obsolete prototype.
  • Nursie 4y ago
    Bitcoin maximalism like this is so ... pathetic. Other cryptocurrencies are either functionally identical or improve on bitcoin in some way. There is no difference. Just give up.
• sorokod 4y ago
  Mentioned explicitly by Schneier in his post: "And “ransomware couldn’t exist because criminals are blocked from using the conventional financial networks, and cash payments aren’t feasible” does not count." I assume you picked your strongest objection, you need to say something about why blockchain is better than alternatives to make illegal transactions.
  • gfodor 4y ago
    I'm not making a claim on why it is superior, I'm commenting on the fact that its use for this purpose is evidence enough that some people feel it is the best choice for this problem.
• ch4s3 4y ago
  I don't really have any interest in crypto currencies, but they seem to have fond some use in remittances to countries with dysfunctional governments and hyper-inflation that don't allow conversion to USD. It is in some of those circumstances illegal to move in and out of the local currency, but is that a just or reasonable law? If ETH or BTC allow Venezuelans(as one example) in the US to help their relatives buy food, is that not a good thing? There are numerous accounts of people fleeing war and persecution using crypto currencies to escape with their life savings. That seems like a good use case. Not everyone gets to live in a place with strong rule of law, and bad governments love to seize people's bank accounts and hard currency.
  • D13Fd 4y ago
    Other than the speed, though, is it better than mailing USD?
    • ch4s3 4y ago
      Well, mail has to go through customs and cash is very easy to size. You can memorize the key to a crypto wallet and no one will know that you have it. If you try to mail USD as remittances to a lot of countries, it simply will not arrive. It's also not always possible to convert between currencies legally. A number of authoritarian governments prevent their citizens from doing so.
• throwaway0x7E6 4y ago
  >This is trivially falsifiable: blockchains are being used to facilitate illegal transactions. yes, and so does the other crypto - cryptography. facilitating illegal transactions, illegal speech, illegal opinions, illegal thoughts. list of users includes terrorists, drug dealers, pedophiles, Russians, antivaxers and so on. it boggles me how do people fail still fail to understand, after watching our collective liberty being eroded for the past 20 years in the name of combating terrorists and protecting children, that the slippery slope is not a fallacy but a law of nature. the people and entities who want cryptocurrency gone don't give a flying fuck about things they feed the useful idiots as the rationale to do it.
  • hnthrow1010 4y ago
    But that isn't answering the question. You're just saying blockchains are good "because slippery slope" without mentioning what they actually do.
    • jazzyjackson 4y ago
      I thought their answer was very clear: facilitates illegal transactions this is a good thing because tyrannical governments make all kinds of things illegal, and blockchain removes some of this absolute power to prevent various transactions
      • hnthrow1010 4y ago
        Speaking as someone who has been harmed by ransomware, no, it is very much not a good thing. But presuming it was a good thing that I get my data held for ransom, there's no explanation as to why blockchains are uniquely suited to remove some of that absolute power. They appear to be no different from any other illegal digital banking scheme, such as Liberty Reserve: https://en.wikipedia.org/wiki/Liberty_Reserve https://en.wikipedia.org/wiki/Liberty_Reserve Specifically, the "product" is they've assembled a criminal conspiracy to launder money and hide fraud, and they're offering it as a service. When you have sophisticated scammers running them it always takes time for regulators to unravel these schemes; blockchains certainly did not invent this.
• tgv 4y ago
  > This is trivially falsifiable: blockchains are being used to facilitate illegal transactions. There are other mechanisms for facilitating illegal transactions, e.g. the Hawala network. So the blockchain is at least not the single mechanism for this. And if we're really precise, the blockchain itself doesn't solve this particular problem. It solves the trust problem, just like Hawala.
• lisper 4y ago
  > This is trivially falsifiable Only if you consider making it easier to break the law to be solving a problem rather than creating one. Personally, I hew towards the latter point of view. And if you think about it, the continuation of civilization literally depends on having a significant majority of people do the same. > a transaction is morally just if and only if it is legal But that is not the same thing at all. What you originally said was that (legal) crypto transactions solve a problem by making it easier to do other illegal things. The legality of the crypto transaction itself is a red herring. The point is that you are advancing the view that crypto's ability to facilitate breaking the law in general is a feature, not a bug, notwithstanding the legality of crypto per se. Civilization cannot survive that attitude spreading too widely. A system can only sustain so many parasites before it dies.
  • gfodor 4y ago
    > Only if you consider making it easier to break the law to be solving a problem rather than creating one. The question at hand, raised by Schneier, is if the technology has the capability to solve any problems. This seems objectively true: that it has the capacity to help solve the very specific problem of transacting in spite of unjust laws and tyrannical governments. This is a problem we aren't used to having in the West as of late, but certainly it's a common problem for many in history. What you're asking here is if, on net, we ought to consider it a harmful or beneficial technology, to the point where we ought to promote its development or stifle it. That is a separate, more complex question than the one raised of if the technology can solve any real problems.
• einpoklum 4y ago
  Blockchain is a relatively poor facilitator of illegal transactions, in that the chain of past transactions needs to be kept and known to many parties in the distributed algorithm. That makes it not-difficult to track down who it was that made a transaction.
• cortesoft 4y ago
  > But that wincing comes from an assumption: that a transaction is morally just if and only if it is legal. I don't think this is true. The wincing comes from a different assumption; that the state has the right to restrict some transactions. I think almost everyone agrees that there are laws that are either unfair or should be repealed; however, most people don't think that means that the state should be blocked from enforcing laws. While I agree that there needs to be some ability to act outside of the law to allow public opinions on unjust or inappropriate laws to shift, but I don't think being concerned that laws are easy to bypass means that we believe all the laws are just.
  • bombcar 4y ago
    It's not even the state - if Visa and banks, et al decide they will not work with you, then you're severely restricted in the ways you can receive payments: cash and crypto are really the main options at that point.
    • cortesoft 4y ago
      That is a different argument. The comment I replied to was about illegal transactions, not transactions that are blocked by private entitites.
    • pornel 4y ago
      There's no reason to believe that analogous companies won't emerge in cryptocurrencies (in fact it's already happening). VCs are betting there is a market to capture in reinventing payment gateways for merchants, easy-to-use wallets, privacy protections, insurance, escrow, loans, fraud detection, and so on top of cryptocurrencies. These corporations will stand between you and the merchants, and will be able to refuse doing business with you. Don't expect you will be able to use "bare" decentralized blockchain protocols to bypass the new overlords any more than you can currently by sending cash in an envelope to bypass Visa.
    • mmarq 4y ago
      If the state decides to take all your money, it can deploy such force that you will surrender it, regardless of where and how you decide to hide it.
• dasil003 4y ago
  Isn't Bitcoin worse than cash for facilitating illegal transactions? Sure, it works over distances without physical contact, which is a huge logistical advantage. But on the other hand, the blockchain is literally a public ledger, so anonymity is tricky. I know there are solutions, but they require significant savvy. Overall I'm not sure that Bitcoin really solves this very well because your average criminal will probably have better intuition about how to hide and cover up cash transactions than Bitcoin, especially as volumes increase and law enforcement develops their expertise, it will only increase the risk for unsophisticated individuals.