12 ms·

Right, so it turns out that there are a fair amount of operations you can perform on financial objects to change their properties. You can buy, sell, combine, o

Right, so it turns out that there are a fair amount of operations you can perform on financial objects to change their properties. You can buy, sell, combine, or split their risk profiles in different manners to get properties that are useful in different scenarios. Mortgage tranches played a big role in 2008, Black-Scholes helps us describe the behavior of options contracts, and maybe the most accessible for someone not familiar w/ finance is the Ray Dalio McNugget story - https://www.cnbc.com/2018/05/03/how-ray-dalio-helped-launch-mcdonalds-chicken-mcnugget.html https://www.cnbc.com/2018/05/03/how-ray-dalio-helped-launch-... The EVM specifically gives you a Turing complete financial system and, hence, probably a complete expression of operations on financial structures.

this_user 4y ago
> The EVM specifically gives you a Turing complete financial system and, hence, probably a complete expression of operations on financial structures. Which is nice, but doesn't solve any problems that actually exist. That is the running theme with all of these crypto/blockchain/"defi" projects, because they are created by tech people who don't understand the domain. They just start building all of these things that seem useful to tech people, but completely miss what is actually important.
- hailwren 4y ago
  > because they are created by tech people who don't understand the domain. They just start building all of these things that seem useful to tech people, but completely miss what is actually important. This is just false. idk what to tell you, but there are plenty of major builders in the crypto space who are highly regarded in tradfi. See ie jump Even if it were true (it’s not), it’s also a thing that could be said about any product built by tech people and hasn’t really seemed to play out that way in most other places.
- splix 4y ago
  Can you clarify what is "solving a problem that actually exist" means? I just looked around and I'm not sure I have anything that solves an actual problem. Like the HN right now, it doesn't solve anything, right. In the morning I bought stuff on Amazon, but it also doesn't solve any real problem. Not sure AWS is solving anything since we can rent servers directly. I used Zoom for a call, but it solves nothing, I guess. Also used Github, but it's just a useless service because we can use plain Git. I can't really find a tech product I use that clearly "solves a problem". The only problem solver I can recall is my coffee maker, but it's an analog device. So I'm wondering, what it's the criteria to decided if something solves an actual problem or not?
  - notamy 4y ago
    Not the original commenter, but here's my stab at it: > In the morning I bought stuff on Amazon, but it also doesn't solve any real problem. Sure it does. It solves the problem of "I need something, I have money, and I don't have the time/ability/car/... to go to a physical location to buy it." > Not sure AWS is solving anything since we can rent servers directly. AWS gives you you - The ability to spin up MANY classes of servers instantly, whereas traditional server renting is more limited ime. - A host of extra services on top of it that all integrate fairly well with each other - Paid support if you want/need - ... > I used Zoom for a call, but it solves nothing, I guess. People like to see each other, phone calls can have quality issues and dead zones, ... --- Now, when I read the parent comments, I see: > The EVM specifically gives you a Turing complete financial system and, hence, probably a complete expression of operations on financial structures. And while that *sounds* interesting, I have absolutely no IDEA what the utility of this is. With AWS, Zoom, Amazon, ... I can point to things that very very directly benefit both technical and non-technical users day-to-day. That's not to say that there ISN'T use to the EVM -- I'm sure there probably is! -- just that imo it's less-obvious.
    - splix 4y ago
      I would disagree with all the reasons. I understand that it's some real problems the mentioned services solve for you, but I can easily point to a person who has none of those problems. Like my grandma. She doesn't see any point in any of the mentioned products. Even the coffee maker. So we must agree that it depends on the person and is not an objective criterion. Same for blockchan/defi/evm/etc. Some people argue that it solves some of their problems, and you may disagree with them, but it doesn't make their point invalid. I can go with refusing the points you said about the mentioned products. Not because I want to argue, but because it's really not the reason and problems it solved for _me_. I just question myself why I use them and have no answer. 1) Rel. Amazon. I can go to the seller's website directly. I guess I used Amazon because they are so good at marketing, so they are the first to go. But I kind of agree that it solves the problem of simplicity/easier access because a seller's website may have a clumsy website. Some people say that something similar is solved for them by Defi. 2) For AWS, I don't use anything you mentioned. It sounds interesting, like spinning many instances, but I never witnessed it being used like that. Except for instances where someone was playing with the tech (and you can apply it the exact same way to EMV). Also, recently I played with Kubespray, a tool to easily roll out a Kubernetes cluster on a bare metal, and now I don't see a reason to use AWS or another cloud provider. Bare servers + Kubernetes is a way to go imho. Maybe the real reason people use AWS is b/c they simply don't know alternatives? 3) For Zoom, I disagree because I am not even sure we always needed to call, honestly. I mean, we have an email and slack, so what's the point of wasting everyone's time on a call. It's just a routine now. Again, not arguing. Just trying to say that there could be multiple points of view. And if something works one way for someone, it may be completely useless and even stupid for others.
dvt 4y ago
> You can buy, sell, combine, or split their risk profiles in different manners to get properties that are useful in different scenarios. I would contend that the only reason things like options, futures, etc. are actually useful in markets like, e.g., the stock market, is, in no small part, due to the highly liquid nature of the underlying. Since the underlying is highly liquid, these derivatives are highly liquid, and therefore we can actually use them for things like de-risking. Of course, people on WSB still gamble using options, but basically they're meant as a hedging mechanism. Even though these "financial primitives" on the blockchain are neat from a technical standpoint, they tend to blow up precisely because the markets are not liquid enough (so second-order effects are amplified).
- hailwren 4y ago
  > Even though these "financial primitives" on the blockchain are neat from a technical standpoint, they tend to blow up precisely because the markets are not liquid enough (so second-order effects are amplified). I would rephrase this to say that the less liquid state of blockchain markets limits the available set of financial primitives which are resistant to manipulation. It’s true, but if liquidity is the only hurdle — I think you’ve more or less ceded that blockchain provides value. It just needs wider adoption. (Probably a stronger support of blockchain than I would personally offer.)
  - dvt 4y ago
    > I think you’ve more or less ceded that blockchain provides value. It just needs wider adoption This is a vacuous non-sequitur. It's like saying "my new social network provides value, it just needs wider adoption"—uh, yeah, that's how social networks (or markets) work. If no one is using it, by definition, it has no value. Markets are social games (not merely "financial" ones). And exceedingly few people are using crypto in general, but even fewer are using it as a store of value, or as a way to transfer money, or as any kind of hedge. And even if we look at the people using it, most use it merely as a casino. I mean think about it: not even 100 million people have a BTC wallet. It took Snapchat 4 years to reach 100 million daily active users. We're now in year 14 of Bitcoin.

this_user 4y ago

> The EVM specifically gives you a Turing complete financial system and, hence, probably a complete expression of operations on financial structures. Which is nice, but doesn't solve any problems that actually exist. That is the running theme with all of these crypto/blockchain/"defi" projects, because they are created by tech people who don't understand the domain. They just start building all of these things that seem useful to tech people, but completely miss what is actually important.

hailwren 4y ago
> because they are created by tech people who don't understand the domain. They just start building all of these things that seem useful to tech people, but completely miss what is actually important. This is just false. idk what to tell you, but there are plenty of major builders in the crypto space who are highly regarded in tradfi. See ie jump Even if it were true (it’s not), it’s also a thing that could be said about any product built by tech people and hasn’t really seemed to play out that way in most other places.
splix 4y ago
Can you clarify what is "solving a problem that actually exist" means? I just looked around and I'm not sure I have anything that solves an actual problem. Like the HN right now, it doesn't solve anything, right. In the morning I bought stuff on Amazon, but it also doesn't solve any real problem. Not sure AWS is solving anything since we can rent servers directly. I used Zoom for a call, but it solves nothing, I guess. Also used Github, but it's just a useless service because we can use plain Git. I can't really find a tech product I use that clearly "solves a problem". The only problem solver I can recall is my coffee maker, but it's an analog device. So I'm wondering, what it's the criteria to decided if something solves an actual problem or not?
- notamy 4y ago
  Not the original commenter, but here's my stab at it: > In the morning I bought stuff on Amazon, but it also doesn't solve any real problem. Sure it does. It solves the problem of "I need something, I have money, and I don't have the time/ability/car/... to go to a physical location to buy it." > Not sure AWS is solving anything since we can rent servers directly. AWS gives you you - The ability to spin up MANY classes of servers instantly, whereas traditional server renting is more limited ime. - A host of extra services on top of it that all integrate fairly well with each other - Paid support if you want/need - ... > I used Zoom for a call, but it solves nothing, I guess. People like to see each other, phone calls can have quality issues and dead zones, ... --- Now, when I read the parent comments, I see: > The EVM specifically gives you a Turing complete financial system and, hence, probably a complete expression of operations on financial structures. And while that *sounds* interesting, I have absolutely no IDEA what the utility of this is. With AWS, Zoom, Amazon, ... I can point to things that very very directly benefit both technical and non-technical users day-to-day. That's not to say that there ISN'T use to the EVM -- I'm sure there probably is! -- just that imo it's less-obvious.
  - splix 4y ago
    I would disagree with all the reasons. I understand that it's some real problems the mentioned services solve for you, but I can easily point to a person who has none of those problems. Like my grandma. She doesn't see any point in any of the mentioned products. Even the coffee maker. So we must agree that it depends on the person and is not an objective criterion. Same for blockchan/defi/evm/etc. Some people argue that it solves some of their problems, and you may disagree with them, but it doesn't make their point invalid. I can go with refusing the points you said about the mentioned products. Not because I want to argue, but because it's really not the reason and problems it solved for _me_. I just question myself why I use them and have no answer. 1) Rel. Amazon. I can go to the seller's website directly. I guess I used Amazon because they are so good at marketing, so they are the first to go. But I kind of agree that it solves the problem of simplicity/easier access because a seller's website may have a clumsy website. Some people say that something similar is solved for them by Defi. 2) For AWS, I don't use anything you mentioned. It sounds interesting, like spinning many instances, but I never witnessed it being used like that. Except for instances where someone was playing with the tech (and you can apply it the exact same way to EMV). Also, recently I played with Kubespray, a tool to easily roll out a Kubernetes cluster on a bare metal, and now I don't see a reason to use AWS or another cloud provider. Bare servers + Kubernetes is a way to go imho. Maybe the real reason people use AWS is b/c they simply don't know alternatives? 3) For Zoom, I disagree because I am not even sure we always needed to call, honestly. I mean, we have an email and slack, so what's the point of wasting everyone's time on a call. It's just a routine now. Again, not arguing. Just trying to say that there could be multiple points of view. And if something works one way for someone, it may be completely useless and even stupid for others.

dvt 4y ago

> You can buy, sell, combine, or split their risk profiles in different manners to get properties that are useful in different scenarios. I would contend that the only reason things like options, futures, etc. are actually useful in markets like, e.g., the stock market, is, in no small part, due to the highly liquid nature of the underlying. Since the underlying is highly liquid, these derivatives are highly liquid, and therefore we can actually use them for things like de-risking. Of course, people on WSB still gamble using options, but basically they're meant as a hedging mechanism. Even though these "financial primitives" on the blockchain are neat from a technical standpoint, they tend to blow up precisely because the markets are not liquid enough (so second-order effects are amplified).

hailwren 4y ago
> Even though these "financial primitives" on the blockchain are neat from a technical standpoint, they tend to blow up precisely because the markets are not liquid enough (so second-order effects are amplified). I would rephrase this to say that the less liquid state of blockchain markets limits the available set of financial primitives which are resistant to manipulation. It’s true, but if liquidity is the only hurdle — I think you’ve more or less ceded that blockchain provides value. It just needs wider adoption. (Probably a stronger support of blockchain than I would personally offer.)
- dvt 4y ago
  > I think you’ve more or less ceded that blockchain provides value. It just needs wider adoption This is a vacuous non-sequitur. It's like saying "my new social network provides value, it just needs wider adoption"—uh, yeah, that's how social networks (or markets) work. If no one is using it, by definition, it has no value. Markets are social games (not merely "financial" ones). And exceedingly few people are using crypto in general, but even fewer are using it as a store of value, or as a way to transfer money, or as any kind of hedge. And even if we look at the people using it, most use it merely as a casino. I mean think about it: not even 100 million people have a BTC wallet. It took Snapchat 4 years to reach 100 million daily active users. We're now in year 14 of Bitcoin.