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Blockchains. Distributed consensus is incredibly powerful. It will allow us to rebuild our society around individuals instead of corporations and governments th

by natrius 11y ago

Blockchains. Distributed consensus is incredibly powerful. It will allow us to rebuild our society around individuals instead of corporations and governments that formed because economic transaction costs were so high that economies of scale (and sometimes the use of force) were required to coordinate our society. All economic activity will be blockchain-mediated. It will make us wealthier and freer.

ForHackernews 11y ago
The "low costs" of bitcoin are a myth. Bitcoin transactions are extremely expensive, both financially and ecologically, it's just that those costs are currently subsidized by block rewards to miners instead of paid by consumers/end-users. If bitcoin were ever to be widely adopted, the high fees would have to be passed on to users: http://www.coindesk.com/new-study-low-bitcoin-transaction-fees-unsustainable/ http://www.coindesk.com/new-study-low-bitcoin-transaction-fe... At some level, this basic fact should be incredibly obvious to anyone with any technical background: It's much cheaper and easier to operate a centralized, eventually-consistent database (today's banking system) than a distributed ledger that requires constantly burning electricity and computing resources on useless math puzzles. Nevertheless, I still see bitcoin advocates claiming bitcoin will be cheaper than the legacy transaction system.
- fizx 11y ago
  https://en.wikipedia.org/wiki/Proof-of-stake https://en.wikipedia.org/wiki/Proof-of-stake
- natrius 11y ago
  I am not talking about Bitcoin in particular, nor am I talking about transaction fees. I am talking about transaction costs and blockchains in general. https://en.wikipedia.org/wiki/Transaction_cost https://en.wikipedia.org/wiki/Transaction_cost
  - nostrademons 11y ago
    Of the categories of transaction cost listed in that article, the only one blockchains address is the policing & enforcement cost. Even then, it only addresses one side of the policing cost: it ensures that the seller receives payment without need for a trusted intermediary, but it does nothing to ensure that the buyer receives a good that is of acceptable quality and performs the function agreed upon.
    - natrius 11y ago
      All of those transaction costs can be handled by decentralized communication backed by reputation systems. Blockchains are great platforms for reputation systems. We will soon see that while it's hard to get systems off the ground that require network effects, making them entirely open and run by no one makes them a great choice for developers and consumers. I expect that decentralization yields its own sort of network effects.
  - deleted 11y ago
    [deleted]
- popinman322 11y ago
  Just curious, what do you think of Stellar's consensus system? https://medium.com/a-stellar-journey/on-worldwide-consensus-359e9eb3e949 https://medium.com/a-stellar-journey/on-worldwide-consensus-...
  - grubles 11y ago
    Here is some reading material from gmaxwell: https://bitcointalk.org/index.php?topic=144471.msg9764161#msg9764161 https://bitcointalk.org/index.php?topic=144471.msg9764161#ms...
lamby 11y ago
> Blockchains Just out of curiosity and not to diminish their current practical implications, are blockchains really a new invention?

by natrius 11y ago

ForHackernews 11y ago

The "low costs" of bitcoin are a myth. Bitcoin transactions are extremely expensive, both financially and ecologically, it's just that those costs are currently subsidized by block rewards to miners instead of paid by consumers/end-users. If bitcoin were ever to be widely adopted, the high fees would have to be passed on to users: http://www.coindesk.com/new-study-low-bitcoin-transaction-fees-unsustainable/ http://www.coindesk.com/new-study-low-bitcoin-transaction-fe... At some level, this basic fact should be incredibly obvious to anyone with any technical background: It's much cheaper and easier to operate a centralized, eventually-consistent database (today's banking system) than a distributed ledger that requires constantly burning electricity and computing resources on useless math puzzles. Nevertheless, I still see bitcoin advocates claiming bitcoin will be cheaper than the legacy transaction system.

fizx 11y ago
https://en.wikipedia.org/wiki/Proof-of-stake https://en.wikipedia.org/wiki/Proof-of-stake
natrius 11y ago
I am not talking about Bitcoin in particular, nor am I talking about transaction fees. I am talking about transaction costs and blockchains in general. https://en.wikipedia.org/wiki/Transaction_cost https://en.wikipedia.org/wiki/Transaction_cost
- nostrademons 11y ago
  Of the categories of transaction cost listed in that article, the only one blockchains address is the policing & enforcement cost. Even then, it only addresses one side of the policing cost: it ensures that the seller receives payment without need for a trusted intermediary, but it does nothing to ensure that the buyer receives a good that is of acceptable quality and performs the function agreed upon.
  - natrius 11y ago
    All of those transaction costs can be handled by decentralized communication backed by reputation systems. Blockchains are great platforms for reputation systems. We will soon see that while it's hard to get systems off the ground that require network effects, making them entirely open and run by no one makes them a great choice for developers and consumers. I expect that decentralization yields its own sort of network effects.
- deleted 11y ago
  [deleted]
popinman322 11y ago
Just curious, what do you think of Stellar's consensus system? https://medium.com/a-stellar-journey/on-worldwide-consensus-359e9eb3e949 https://medium.com/a-stellar-journey/on-worldwide-consensus-...
- grubles 11y ago
  Here is some reading material from gmaxwell: https://bitcointalk.org/index.php?topic=144471.msg9764161#msg9764161 https://bitcointalk.org/index.php?topic=144471.msg9764161#ms...

lamby 11y ago

> Blockchains Just out of curiosity and not to diminish their current practical implications, are blockchains really a new invention?