4 ms·

It also seems like those "layers on top of BTC" erode one of the only aspects of blockchain that has appeal for me -- the full transparency of the system, such

It also seems like those "layers on top of BTC" erode one of the only aspects of blockchain that has appeal for me -- the full transparency of the system, such that you can see every exchange of BTC on the network. The minute you offload any of that to other systems, you're essentially creating dark pools and money laundering opportunities because of differential oversight.

babypuncher 4y ago
And you're trusting some central authority to manage your money along with that of countless others. You're right back in the same situation you presumably wanted to avoid with fiat and banks, only with exponentially greater environmental impact and no regulations in place to protect your money when things go FUBAR.
- adastra22 4y ago
  The L2 systems built on bitcoin have faults, but centralization is not one of them. You don’t go custodial when you put bitcoin into a lightning channel.
  - aaaaaaaaata 4y ago
    and the L2 systems on ETH have even fewer faults.
smoldesu 4y ago
If there's one thing that people should correctly point out as scams in the world of crypto, it should be L2 chains. Every single one of them is a ploy to enrich their creator, full-stop. I don't even know what kind of pipe dream they sell to their investors to get capital. It's particularly funny, because I remember Justin Sun trying to scam people like this years before cryptocurrency had really taken off. Back then, though, everyone who had skin in the game actually cared about the health of the community, and the guy lost millions of dollars trying some really insane hostile takeover tactics. Nowadays though, nobody cares. The hucksters of this world make their money hand over fist now.
- stingraycharles 4y ago
  I’m a relative crypto noob, but I did see certain “lightspeed” transactions which would allow for high-volume and “instant” transactions. Is this also considered an L2 chain, or not? If not, how does it circumvent the limitations of the bitcoin blockchain without sacrificing transparency?
  - smoldesu 4y ago
    > Is this also considered an L2 chain, or not? I can't say for sure without actually seeing the tech, but if a company promises to scale cryptocurrency transactions then they're probably doing it on an L2 chain. The problems with this are obvious: trusting a single party to handle all of your transactions and not abuse that insider info is crazy. These people are going to use their power over the chain to eke out every cent they can, otherwise it doesn't make financial sense to operate in the first place. It looks attractive from a VC standpoint, but that's because it's a deliberate honeypot.
    - aaaaaaaaata 4y ago
      What about a decentralized L2 with zk-proofs?
      - smoldesu 4y ago
        I don't know, and I don't really care. Any sufficiently complicated technology is indistinguishably from magic, and I don't trust magic to manage my finances. L1 chains are simple and their trust models are transparent, I don't think any L2 chain is going to see widespread adoption when decidedly better alternatives exist.
- engmgrmgr 4y ago
  That’s a rather myopic view. You could look at L2s as a sort of credit card system, and from a systems and technology POV there’s nothing inherently “scammy” about it. For web3 applications of any meaningful large scale, L2 solutions are necessary. For better or worse, the L2 developer platforms that I assume you’re referring to are essentially low-code solutions to abstract away the actual systems software engineering aspect of web3 development. Are the low-code SaaS companies overvalued or “scammy”? I’m not suggesting they are or are not. Well-staffed tech companies building web3 applications often build their own implicit L2 solutions because it’s just how you connect things in a distributed system with modern L1 blockchain constraints.
jrumbut 4y ago
> one of the only aspects of blockchain that has appeal for me -- the full transparency of the system, such that you can see every exchange of BTC on the network. Which is interesting for many applications but kind of kills BTC as something that could be an everyday currency. I'm already uncomfortable with the amount of data my bank has about me. No matter what scheme has been used to obfuscate it, I'm not comfortable with that data being held by anyone with a hard drive and internet connection.
germandiago 4y ago
Money not stolen by who do not earn it. I love the idea.

babypuncher 4y ago

And you're trusting some central authority to manage your money along with that of countless others. You're right back in the same situation you presumably wanted to avoid with fiat and banks, only with exponentially greater environmental impact and no regulations in place to protect your money when things go FUBAR.

adastra22 4y ago
The L2 systems built on bitcoin have faults, but centralization is not one of them. You don’t go custodial when you put bitcoin into a lightning channel.
- aaaaaaaaata 4y ago
  and the L2 systems on ETH have even fewer faults.

smoldesu 4y ago

If there's one thing that people should correctly point out as scams in the world of crypto, it should be L2 chains. Every single one of them is a ploy to enrich their creator, full-stop. I don't even know what kind of pipe dream they sell to their investors to get capital. It's particularly funny, because I remember Justin Sun trying to scam people like this years before cryptocurrency had really taken off. Back then, though, everyone who had skin in the game actually cared about the health of the community, and the guy lost millions of dollars trying some really insane hostile takeover tactics. Nowadays though, nobody cares. The hucksters of this world make their money hand over fist now.

stingraycharles 4y ago
I’m a relative crypto noob, but I did see certain “lightspeed” transactions which would allow for high-volume and “instant” transactions. Is this also considered an L2 chain, or not? If not, how does it circumvent the limitations of the bitcoin blockchain without sacrificing transparency?
- smoldesu 4y ago
  > Is this also considered an L2 chain, or not? I can't say for sure without actually seeing the tech, but if a company promises to scale cryptocurrency transactions then they're probably doing it on an L2 chain. The problems with this are obvious: trusting a single party to handle all of your transactions and not abuse that insider info is crazy. These people are going to use their power over the chain to eke out every cent they can, otherwise it doesn't make financial sense to operate in the first place. It looks attractive from a VC standpoint, but that's because it's a deliberate honeypot.
  - aaaaaaaaata 4y ago
    What about a decentralized L2 with zk-proofs?
    - smoldesu 4y ago
      I don't know, and I don't really care. Any sufficiently complicated technology is indistinguishably from magic, and I don't trust magic to manage my finances. L1 chains are simple and their trust models are transparent, I don't think any L2 chain is going to see widespread adoption when decidedly better alternatives exist.
engmgrmgr 4y ago
That’s a rather myopic view. You could look at L2s as a sort of credit card system, and from a systems and technology POV there’s nothing inherently “scammy” about it. For web3 applications of any meaningful large scale, L2 solutions are necessary. For better or worse, the L2 developer platforms that I assume you’re referring to are essentially low-code solutions to abstract away the actual systems software engineering aspect of web3 development. Are the low-code SaaS companies overvalued or “scammy”? I’m not suggesting they are or are not. Well-staffed tech companies building web3 applications often build their own implicit L2 solutions because it’s just how you connect things in a distributed system with modern L1 blockchain constraints.

jrumbut 4y ago

> one of the only aspects of blockchain that has appeal for me -- the full transparency of the system, such that you can see every exchange of BTC on the network. Which is interesting for many applications but kind of kills BTC as something that could be an everyday currency. I'm already uncomfortable with the amount of data my bank has about me. No matter what scheme has been used to obfuscate it, I'm not comfortable with that data being held by anyone with a hard drive and internet connection.

germandiago 4y ago

Money not stolen by who do not earn it. I love the idea.