11 ms·
Bitcoin befuddles experts who analyze it from a narrow perspective, because it is not just a new medium of exchange or a new store of value: it is also a new k
by cs702 13y ago
Bitcoin befuddles experts who analyze it from a narrow perspective, because it is not just a new medium of exchange or a new store of value: it is also a new kind of point-of-sale payment system (one that doesn't require payment processors), a new kind of global financial transfer system (one that doesn't require financial institutions), a new kind of time-stamping certification system (one that doesn't require notaries or county clerks), a new kind of contract-enforcing mechanism (one that doesn't require lawyers), etc.
With rising global adoption, many new kinds of applications are likely to be created to take advantage of the Bitcoin network, the design of which even specifies a built-in script for defining and executing new types of transactions involving any arbitrary number of parties.[1]
In short, Bitcoin is a technology platform -- one that is benefiting from network effects.
It may fail as "money" (in a narrow sense) and still succeed as a global platform.
In fact, Bitcoin is already a success.
--
[1] https://en.bitcoin.it/wiki/Script https://en.bitcoin.it/wiki/Script
- silverlake 13y ago> Bitcoin befuddles experts Why is this guy an expert? He was an equity analyst for a long-time, but obviously not good enough to get rich. And there are thousands of Wall St. analysts walking around in NYC. I wouldn't even trust their opinion on equities, much less something new. Never read opinion pieces written by journalists.
- mercurialshark 13y agoWell said. You should paste this comment into the NYTimes comment section, it clearly articulates the issues (even for the technologically inept), of which none were discussed in the article.
- andrewla 13y agoI'll jump on this and say that the script issue is irrelevant to Bitcoin's success. In fact, I would argue that the script functionality is a huge flaw in bitcoin, probably the largest flaw. The existence of a scripting language within the transaction log makes it much more difficult to analyze whether I hold bitcoins or not -- my ability to spend bitcoins "held" in my address is contingent on my having additional information at the time that I post the transaction. Having a generic proof-of-work-chain-based cumulative notary service might be valuable in and of itself. But bitcoin's value as "money" is independent of that functionality, and in the long run, the complexity of that scripting language and the difficulty of answering the question "have I been paid" will become problematic.
- dwaltrip 13y agoCan't one just simply check the nature of the transaction to see if it has any conditionals? It isn't hard to imagine those features being added to blockchain related web services, such as blockchain.info.
- andrewla 13y agoSure - so what do you do if there are conditionals? In the full generality of the language, it will be hard to offer an experience to the "recipient" of the transaction that is not confusing.
- tlrobinson 13y ago"my ability to spend bitcoins "held" in my address is contingent on my having additional information at the time that I post the transaction." Fortunately software excels at automating tasks like this. You already need software to scan the entire blockchain to determine address balances, is it really that hard for it to keep track of non-trivial unspent transactions separately?
- andrewla 13y agoYes, software can automate the task of redemption for specific types of transactions. But not being able to answer the question "how many bitcoins are at this address" seems to be very problematic. Instead, you'll have a ton of publisher clearing house style "you just received a million bitcoins" notifications, once they enable more of the language in the client. It just seems confusing and unnecessary.
- hacknat 13y agoOr a failure, depending on one's perspective. Edit rationale:https://news.ycombinator.com/item?id=6810806 https://news.ycombinator.com/item?id=6810806
- altoz 13y agoI can't help but think a lot of these "experts" can ONLY see from their narrow perspective. Bitcoin the protocol is just scratching the surface.
- reflectiv 13y agoExactly... Even if you take the assumption that bitcoin will fail, the problems/issues the protocol or something similar solves are far too beneficial to ignore. So basically if bitcoin fails, some other similar form of digital currency will rise up in its place. I feel as though its a 'cat is out of the bag' scenario.
- waps 13y agoYes it does seem like bitcoin is lacking in a few places. You could (try to) add things like * disconnected operation (solve the double spend problem in a disconnected setting) (this would really make something gold-equivalent) * a provably correct, but cryptographically secure ledger (meaning real anonymity) * proof of work based on a single crypto standard seems risky. Use 5 of them. * provably no way to compromise the network even with overwhelming computational power
- genofon 13y ago"Experts are clueless" -Steve Jobs
- willis77 13y agoAlso, don't forget that people like to come out on record for/against hot ideas/topics/predictions. In the event they are right, they ride the success all the way to the fame and monetary bank. If they're wrong, such an article is usually forgotten and lost in the sea of bitcoin press.
- chriswilmer 13y agoBefuddles eh? I'll just leave this here... http://www.befuddled.org/ http://www.befuddled.org/
- aaronem 13y agoAmazingly useless!
- fleitz 13y agoPlease explain how bitcoin can discern vicarious liability. You're still going to need lawyers. Please explain how a bitcoin blockchain record can testify in court that a copy of a document is authentic. Hint, you're infront of a jury, you have a blockchain hash, and opposing council has a notary public with 40 years of experience, both copies of the document differ, the original cannot be found. Hers has an official looking seal, you have some random numbers. Please explain how I can buy a pack of cigarettes at 11 pm in under 5 minutes with bitcoin. In short most of your claims are highly exaggerated and don't work beyond the most trivial scenarios.
- stormbrew 13y agoActually, you have an expert (or more than one expert) who can testify to the nature of the block chain and the difficulty and expense involved in altering its history.
- elwin 13y ago> Please explain how a bitcoin blockchain record can testify in court that a copy of a document is authentic. Hint, you're infront of a jury, you have a blockchain hash, and opposing council has a notary public with 40 years of experience, both copies of the document differ, the original cannot be found. Hers has an official looking seal, you have some random numbers. Here's an imaginary possibility. A hundred and fifty years from now, courtrooms come with computer systems built from scratch and operated by court clerks. Their sole purpose is verifying blockchain records. The jury knows to trust the machine. In fact, the jury instructions tell them to. None of the jury members have ever seen official documents on physical paper. They only know about paper documents from watching historical fiction movies. In such movies, the possibility that the documents are forged is always a major plot factor.
- shubb 13y agoI think in practice, the first time someone needed to do this, a bunch of high grade academic cryptographers would acts as expert witnesses pro-bono. From there, it would be like a hacking case - an expert explains the issue to the jury, who take a decision. Assuming it is technically sound, bitchain certification would win. Subsequent cases would be able to use the precedent, and win with less interesting experts.
- Aqueous 13y agoThey are applying old-world money ideas to something that is so new that we don't have useful models yet for deciding how it will behave, thinking that they do apply without loss of content. The rules of supply and demand apply, sure, but none of the other common-sense intuitions about how money works. BitCoins don't have any resistance to movement, or very little. Physical money does. This means the difference between BitCoins and physical money is perhaps comparable to the difference between massive particles like atoms and massless particles like photons, or to the difference between a classical conductor and a superconductor. Which is only to say that the same rules don't apply - new behaviors are observed. We are in a new world and the study of economics is about to take a huge left-turn.
- brador 13y agoThat's because Bitcoins are relatively easy to buy and very difficult to cash out into real currency. Once enough people see how hard it is to liquidate their Bitcoins back to USD the realization will follow.
- kdeforche 13y agoSounds like nonsense to me: if you buy 1 BTC from me, then at the same time I've sold 1 BTC? That makes it by definition as equally hard (or easy) to buy as to sell?
- conanbatt 13y agoDepends on who is in the middle of that transaction and how long that one takes to fullfill that operation, in this case, exchanges.
- dinkumthinkum 13y agoAre you all really having trouble understanding how instability in currency makes it difficult to trade in a currency? Also there is some basic lapse in logic here. Just because a WoW nerd can trace the currency on a technical level, does not mean it is "easy."
- 13y ago
- smrtinsert 13y agoI think most people only care about its failure in the 'money' sense.
- stevewilhelm 13y ago> It may fail as "money" (in a narrow sense) and still succeed as a global platform. I think that was the author's point. For example, Paypal, Amazon or the IRS could announce tomorrow they will accept payment in Bitcoins but peg their BTC/USD exchange rate to one. Speculation would all but stop and Bitcoins would become a transaction platform.
- indrax 13y agoCan I get my tax return in BTC at 1:1 please? please?
- mtkd 13y agoBut we're seeing a layer appear with companies like Bitpay that solves the volatile exchange rate issue.
- mindstab 13y agoNo, because no one would give them bitcoins at 1:1 and they can't magic up their own, they 'd have to buy them at market price and then sell them at a hilarious loss.
- stevewilhelm 13y agoeBay, Amazon, and IRS don't need Bitcoins, they can set any exchange rate they want. If enough goods and service providers followed suit, current speculators would have to take a hilarious loss to buy anything.
- mindstab 13y agothey can sure set them, and then no one would use them. do you not understand money? what are you, the owner of 100btc going to do: a) buy $100usd worth of goods at ebay directly b) cash out at a proper exchange for $100,000usd, then buy $100usb worth of goods on ebay and have $99,900usd left over? or cash out ONE btc for $1000usd, buy $100usd of goods and have $900 usd left over AND 99btc? How do you expect any even remotely rational players do participate in this farce?
- jljljl 13y agoIS this all really that big of a deal? Everything you've described above shouldn't really shatter any sort of economic models, it just increases the velocity at which money is exchanged, and reduces any frictions that might occur during transactions. Nothing that can't be accounted for in existing models.
- andrewljohnson 13y agoYou could have said the same for PayPal.
- jljljl 13y agoAre you saying PayPal has upended monetary economics?
- bitcoin-truth 13y agoHas bitcoin?
- foobarqux 13y agoIt doesn't seem to do any of these things very well. And in any case none of the uses suggest that the value of a bitcoin should increase substantially.