
Building for the Blockchain - vincentschen
http://blog.ycombinator.com/building-for-the-blockchain/
======
davesque
A blockchain ensures that some sequence of agreements was made in a way that
everyone can trust. If everyone keeps their secret keys secure and solely in
their possession, then no activity can be forged on the network by any
significant likelihood.

Anywhere this concept has value, a blockchain has value. That's all there is
to it. The rest is fairy dust and noise.

I don't really follow a lot of the discussion in this article. As I see it,
most of the buzz around blockchains is just wild speculation and fantasy. For
example, why would be want a "fat" protocol? In any other context in
technology, "fat" _anything_ is considered bad. Technologies are supposed to
be "thin", simple, efficient, and composable. So why would the opposite be
praised in this case? Furthermore, the characterization of existing
foundational internet protocols as "thin" and blockchain protocols as "fat"
seems like an inversion of truths. By my understanding, it would take as long
or much longer to become well versed in all the nitty-gritty details of
TCP/IP, DNS, etc. than it would to gain a solid understanding of Ethereum.
Also, where is the need for software ecosystem micro-economies?

None of this makes any logical sense to me. It seems people have gotten it in
their heads that the simple technological innovations of hash trees and
distributed consensus protocols are going to somehow make them rich. And
they're finding weird ways of justifying this.

~~~
fragsworth
It seems like in most cases, the tokens are being used as a way for the
developers to get funding to implement their project without the bureaucracy
and costs of doing a real IPO.

That would be fine on its own, but they're almost all pretending this is not
the reason for it, and that the token is necessary. This is an obvious lie in
nearly every case when you dig into the details. Nearly every dapp that has
its own token can be cloned to use Ether without any detriment to the product.

~~~
sova
Absolutely right, the tokens are just a stepping stone to getting the
[distributed] app off the ground. It's a great model! If you believe in the
utility of something you can fund it very early on and reap great rewards, or
at least root great endeavors on.

~~~
Karrot_Kream
How so? Can't you just do the same thing staking Ether instead of yet another
ERC20 token?

~~~
colecut
Yes agreed, in several cases this summer I thought I was doing well with ICOs
until I did the math and realized I would have done at least as well by just
holding the ETH.

~~~
kukabynd
And this here is why we’re in a bubble.

~~~
colecut
I don't really follow your logic, considering I was referring to over 6 months
ago.

But I do agree we're in a bubble.

------
rsp1984
_Monegro believes that this paradigm shift affects the way that developers
should think about their applications: “The combination of shared open data
with an incentive system that prevents “winner-take-all” markets changes the
game at the application layer and creates an entire new category of companies
with fundamentally different business models at the protocol layer.”_

Ok, thin protocols + fat apps --> fat protocols + thin apps. Neat theory. But
this is putting the cart before the horse. Please can someone ELI5 to me:

* What problem does the fat-protocol, thin-app paradigm solve?

* Why would anyone be interested in developing a thin app for my fat protocol any more than anyone is interested today in developing a thin protocol that I can put my fat app on top of?

* Why is thin-protocol, fat-app considered to be in need of fixing in the first place? I consider the fact that apps capture more value than protocols to be a direct consequence of the free market. Apps capture business value because they solve actual user problems. Protocols define ways to build apps. But frankly I don't see a great demand for new protocols, and I consider that reason enough for the fact that protocols can't capture much value. To say that that would change with the blockchain is IMO equivalent to saying the market has it all wrong. What am I not seeing?

~~~
keithwhor
You’re seeing everything just fine.

Imagine you’ve spent your whole life investing millions of dollars in
entrepreneurs. Building models and testing hypotheses with no real agency: you
can’t control what the CEO does or the product the engineering team builds or
the way they market the product. Your job is to provide returns for your LPs.
That’s it.

Now imagine, instead of spending thousands of hours interacting with and
managing people, their problems, watching painfully as they try to figure out
the market they specialize in, I tell you that you can invest in something
else. That thing, we’ll call it a token. This token does work. It can be used
to compute something. Or helps make something easier. I’m not clear on the
specifics, but I can tell you one thing: if you buy it, and if you tell other
people about it, merely the act of owning it increases its value.

I have just given you something you don’t get a lot of in your career, true,
direct self agency. You are unequivocally sure that you are creating value
because it’s you who is selling the value! You bought, the price rose, you
know if other people get excited the price will rise again. It’s exciting, you
don’t have to deal with people mucking about directly, and you’re doing your
job: generating returns.

The house of cards here is the assumption that these tokens can be used for
something, _anything_ beyond a store of value. Because if that’s true, it’s
not really speculation. You’re an early adopter of a paradigm-changing
protocol.

The default assumption here is that engineers are like ants: we build for the
sake of building. Give us a canvas and we will build dApps (or what-have-you)
just for the sake of building them.

The truth is, engineers are not ants. We build things to make our lives easier
or more fulfilling. I started programming, for example, to build video games.
Many people build things to automate their homes. When you build for an
employer, the end goal is always to do something for the customer.

The draw of Ethereum, seems to me, to be that _eventually_ somebody will have
to build something insanely valuable, _right_? Statistically, it’s gotta
happen. I think that’s a ridiculous premise: if centralized tools are always
faster with more mature ecosystems, engineers will always go there to solve
their daily problems. The question to me really seems to be, “do we need truly
immutable ledgers and transaction histories? Do we need 100.0% reliability in
transaction history at the cost of orders of magnitude more energy
expenditure, or is 99.9999999% okay?” As a cute anecdote, Life has been
remarkably successful with a 10^-7 error rate in DNA polymerase. I have a
feeling most industries will be fine without, and it’s actually probably
cheaper to have a reasonable facsimile (or statistically insignificant
approximation) of immutability (human intervention and accountants included)
than a guarantee. Especially if, in order to be guaranteed, it needs to be
public.

So, what you’re seeing is speculation that engineers could build something one
day using an application development paradigm that’s not actually clearly or
obviously more powerful. It’s worse speculation than betting on startups with
teams of people who reliably execute, masked by the illusion of self agency as
an owner and promoter of a token.

tl;dr: Somebody remind me of this post in a decade and we’ll see where it all
ends up. The technology will grow and evolve. I’m not sold on any of this, and
investors who aren’t building anything but themselves are holding tokens
telling people to go experiment and build things isn’t an attractive signal.
(It seems like VC flipped on its head and the incentives are poor for
engineers - so, for now, let these investors play hot potato with each other
for a while. I’ve seen a few of Vitalik’s tweets and it seems even he’s
concerned about these incentives.)

~~~
eximius
I don't disagree with anything you said.

But, separately, if you asked me if I wanted to use something to
store/transmit value that was only reliable 99.9999999% of the time, I would
immediately say no. At Visa scale, that means 15 transactions a day are
incorrect - not delayed, just straight up incorrect. Maybe that already
happens and we just don't hear about it because they can fix it without any
one noticing or it's just small enough to not be noticed. But it is still
unnerving.

~~~
vvanders
15 transactions a day? I'm guessing that number is in the thousands, easily.

Manual input at restaurants alone should hit that threshold. As you correctly
pointed out, reversing the transaction is very low friction, which is
something I've not yet seen presented in any blockchain based solution.

~~~
tyrust
Visa claims to handle 150 million transactions a day [0].

(150 * 10^6) * (1 - .999999999) =~ 0.15

[0] - [https://usa.visa.com/run-your-business/small-business-
tools/...](https://usa.visa.com/run-your-business/small-business-
tools/retail.html)

------
goodroot
> For one, Ethereum is unable to access real time data from outside the
> blockchain. Developers need to rely on trusted third party data providers,
> called oracles, to provide smart contracts with outside information like
> weather, random numbers, or currency values.

I feel like this is more of a feature than a bug. If you're weaving
applications into the blockchain, would it really be wise to have that chain
communicate with abstract data off of the chain itself? Seems an unnecessary
burden for the chain to bare!

Great article. I've recently gotten into Ethereum Dev and Solidity. It's
really fun, fun stuff. This isn't directly addressed in the Ethereum portion
of the article, but it's good to keep in mind that these things are all works
in progress. Limitations today are non-such tomorrow; we don't quite know
where the train is headed.

You, Developer, can help it get to wherever you feel it needs to go. Remember
that before deciding not to contribute. :)

~~~
Jasper_
What I don't understand is how Ethereum can describe their dapps as
"trustless" when all the trust is still centralized in an oracle. This can
even happen accidentally, such as with the Mayweather/McGregor smart contract
breakage. [0]

But now imagine if BoxRec had intentionally reported false results from their
website in order to make a lot of money on the bet. People would lose their
money, and there would be no recourse.

[0]
[https://www.reddit.com/r/ethtrader/comments/6w5wcn/important...](https://www.reddit.com/r/ethtrader/comments/6w5wcn/important_update_mayweathermcgregor_smart_contract/)

~~~
albertgoeswoof
You can solve this by using multiple oracles and a stake-based consensus
algorithm to de-incentivize malicious reporting.

~~~
Jasper_
I am unable to find anything about using multiple oracles in Ethereum. Do you
have any information about this?

~~~
cslarson
Chainlink is a project to enable a network of decentralised oracles.

~~~
manderson2080
Here's some good background on ChainLink:

[https://medium.com/@signal_capital/https-medium-com-
signal-c...](https://medium.com/@signal_capital/https-medium-com-signal-
capital-our-investment-in-chainlink-15ab90ee9c02)

~~~
Jasper_
Reading up on ChainLink:

> Several data providers respond to this service agreement with a bid in the
> form of a data reply — when enough data providers have responded, the
> majority response is taken (or average depending on the request), outliers
> are removed, and data is fed into the contract.

What's to stop me from setting up 10,000 different data providers that
initially provide good data to get a good reputation score, but then slowly
corrupt them over time? It doesn't matter how many data providers you average
if I can set up millions of them in seconds. I don't see any way to solve
Sybil attacks here.

~~~
manderson2080
There's a penalty payment that each node puts up into escrow for each
assignment of data, and if the data is not accurate in relation to all the
other providers of that same data, the node will lose the payment.

There will also likely be a small amount fo LINK required to start a node with
enough reputation to gain assignments which would also increase the cost of a
Sybil attack.

~~~
traverseda
Mmm, what would stop me from just grabbing the data the other oracles made
available, and pretending I did the actual calculation/check/api-
call/whatever?

~~~
Heraclite
Check the paragraph about Freeloading in their whitepaper

------
snitko
It's all the same thing every year on HN. People trying to find all sorts of
excuses for Bitcoin existence - blockchains, smart contracts, ICOs - as long
as they don't have to accept that Bitcoin's main purpose is and always was to
have an alternative to the financial system, crippling regulations, government
control and taxes. In other words, everything people hate about libertarians,
they try to ignore in Bitcoin. Because they can't just ignore Bitcoin - it's
not going away for some reason.

And it's not going away because there's a demand for Bitcoin. Why? Not because
blockchain is some sort of an innovation. It's because people want a currency
not controlled by any state institution. It's because people want freedom.
Deny that all you want, it's not going away.

~~~
tstactplsignore
>Bitcoin's main purpose is and always was to have an alternative to the
financial system, crippling regulations, government control and taxes.

Does bitcoin really do any of those things? Right now, btc core is not an
alternative to cash- a problem that maybe will be fixed in time, but currently
only seems to be getting worse. If bitcoin really did take off as a global
currency, the IRS would audit unreported bitcoin transactions- and it'd have
your financial records because the corporations and individuals you interact
act with would cooperate, and it'd only need a few to start to deanonymize
you. It seems like the blockchain would almost make the tax job easier,
because all transactions are public unless people move from bitcoin to a
zerocoin model. Even then, the IRS would pursue those who didn't report and
have transaction information from vendors to work to identify fraud.

So, bitcoin doesn't seem like an alternative to taxes. Also have no idea what
it has to do with most government regulation. And, is it really an alternative
to the financial system? Yes, people can use bitcoin instead of a checkings or
savings account- but still need to use traditional services to invest in the
market, and the financial system will continue humming along making more money
from money and making gobs of money profiting off everyone else's market
inefficiency whether it's working in usd or btc.

So, what are we left with? It seems like core btc is only an alternative to a
speculative investment in something that the federal reserve cannot print. And
believe it or not, the vast majority of this country either doesn't care about
quantitative easing, or believes in basic macroeconomics. Core right now seems
to just be a LARP fantasy for libertarians convinced that "this time we can
finally get rid of the evil Fed and their evil money printing". It'll never
happen, and if it does offfer any kind of freedom, it's the freedom to go back
to pre-fiat boom and bust cycles of economic hell detached from modern
macroeconomic theory.

~~~
CryptoPunk
>>It'll never happen, and if it does offfer any kind of freedom, it's the
freedom to go back to pre-fiat boom and bust cycles of economic hell detached
from modern macroeconomic theory.

Before the central banking era, the US banking system was made more fragile
than it would have been under a free market by 1. Civil War era banking
regulations that required banks to hold US bonds as reserves and 2. laws
against interstate branching.

The former resulted in an unstable centralized money supply that fluctuated
with the volume of outstanding US bonds and the latter prevented more
diversified banks from emerging that could better weather localised shocks.
Canada had neither of these mandates and consequently had a far more stable
banking system.

There were proposals before the Fed was created to make the US financial
sector more like Canada's, but the banking cartelists won the argument, and
the Federal Reserve mandates were passed to cartelize the banking sector under
a centralized hierarchy.

Also keep in mind that macroeconomic theory is just theory. It cannot be
scientifically proven correct due to the complexity of the factors involved.
Also keep in mind that there is an enormous financial incentive to popularize
the idea that centralized control over the money supply is economically
beneficial, and Economics is not immune to undue influence. Consider that the
Fed alone employs thousands of economists, and consider the institutional
biases the Fed and its shareholders likely have.

Even with all these forces at play, there's no macroeconomic consensus around
your belief that free market banking is less effective than central banking.

A couple of good talks by George Selgin on pre-Fed era and the 100 year
performance record of the Fed:

[https://youtu.be/Z0J_Ai2sSmY](https://youtu.be/Z0J_Ai2sSmY)

[https://youtu.be/P0E7I4URW5o](https://youtu.be/P0E7I4URW5o)

------
api
Yet so far I still see almost _nothing_ on the block chain (beyond its core
currency use case) that is useful outside the domain of block chain stuff.

The only exception is things like Sia, and that's not cost or convenience
competitive with Amazon S3 or Backblaze.

 _Where is the value here?_ When I visited this I was expecting to see at
least something about building something useful for... something... Building
_what_ for the blockchain?

Oh kitties. Yeah.

I am absolutely aware of the fact that early stage tech often looks like a
toy, but here's the thing. PCs were a toy but it didn't take long at all
(VisiCalc, etc.) before they had actual uses. BBSes were a toy but they were
immediately useful to their users for trading data and messaging.

We are now about eight years into block chain and beyond its one core use
cases there is almost nothing. Whatever value has been delivered seems
extremely minor compared to the vast sums of money being spent, making this
perhaps the worst ROI I've ever seen.

Can someone provide a counter example? What are people doing in the real world
with this stuff?

~~~
TeMPOraL
> _Whatever value has been delivered seems extremely minor compared to the
> vast sums of money being spent, making this perhaps the worst ROI I 've ever
> seen._

What's even worse, from my POV, is the _humongous_ amount of electricity that
is used to support the blockchain. And to what end?

Personally, I won't start believing in the blockchain until a non-wasteful
alternative to the present PoW scheme gets developed _and actually deployed_.
Right now, this looks to me like the most direct way of turning human vices
into cooking us live on this planet that humanity has ever invented.

~~~
tikwidd
The 'end' is the security of the bitcoin blockchain. Defence forces consume a
massive amount of energy and human resources. They are still funded because
countries don't all trust each other and they want security. An alternative to
Proof of Work such as Proof of Stake would be like a country having a nuclear
arsenal, allowing it to cut back on military spending. The problem seems to be
that the incentives are on the miners to switch to another proof system, and
the existing miners wouldn't want to do that because it's their edge in the
market (low electricity costs).

~~~
TeMPOraL
You're talking about the means of blockchain to self-preservation; I'm saying
that we don't need blockchain, that it eats _way_ too much for the fun it
provides, so we should just kill it off and call it a day.

> _The 'end' is the security of the bitcoin blockchain. Defence forces consume
> a massive amount of energy and human resources. They are still funded
> because countries don't all trust each other and they want security._

Yes. Wasteful as evil as the concept of a military is, countries need military
forces to maintain peace, by keeping each other in check. It's an unfortunate
direct consequence of the way humans organize themselves into societies.

But blockchain is _not_ a direct consequence of a fundamental issue in human
organization process (if anything, it's just a direct consequence of human
greed meeting 2010s tech). It's the least efficient way of doing anything,
because it completely eschews the need to _trust_ other actors. Yes, I believe
trustless systems are mostly a _bad_ thing, because trust is literally _the_
efficiency hack that allows us to coordinate at scale.

There are probably some theoretical problems where a trustless solution is
perfect. But as it is today, the blockchain is trying to turn everything in
the society into a Cold War-like military spending problem to avoid having to
trust one another, even though trust-based systems _work just fine_.

------
CiPHPerCoder
People are trying to solve a lot of interesting problems with blockchain, but
I fear it's become the ultimate shoehorn solution for the modern era. See
also: [https://tonyarcieri.com/on-the-dangers-of-a-blockchain-
monoc...](https://tonyarcieri.com/on-the-dangers-of-a-blockchain-monoculture)

I've had meetings with prospective clients that opened with, "We have
$problem, can we use blockchain to solve it?" where anything that doesn't
qualify as a blockchain is cast to the wayside because it doesn't scratch that
buzzword itch.

(Amusingly, I've witnessed one pitch where the person called it "bitchain" and
it sounded like "ba-ching!" and I was waiting for the follow-up to what I
thought was onomatopoeia for a cash register sound. I've since learned to not
abbreviate cryptography as "crypto" lest I attract sketchy prospects.)

A lot of the problems that you might want to solve with a blockchain probably
doesn't need a blockchain. A distributed, append-only cryptographic ledger
will suffice. To wit: [https://paragonie.com/blog/2017/07/chronicle-will-make-
you-q...](https://paragonie.com/blog/2017/07/chronicle-will-make-you-question-
need-for-blockchain-technology)

~~~
arkona
> A distributed, append-only cryptographic ledger

Pardon my ignorance, but isn’t that what a blockchain is?

~~~
woah
I agree that blockchain is overhyped right now, but I don't understand the
common sentiment on HN that "you don't need a blockchain, just an append-only
decentralized database with Merkel root logs", as if that's something easy to
build. What is this hypothetical non-blockchain, where are you going to get
it, and why not just use a blockchain if that's what you need?

~~~
TheDong
Let's look at another project that needed a such a ledger: the certificate
transparency project.

One implementation of it, google's, uses leveldb:

[https://github.com/google/certificate-
transparency](https://github.com/google/certificate-transparency)

Another one out there uses postgres. It turns out that you can use traditional
databases in many cases where you think you need a blockchain, and you'll be
able to waste vastly less energy on proof-of-work and vastly less time dealing
with the terrible mess that is "blockchain".

The reason not to use "blockchain" is that it has 200 definitions, all of them
full of people trying to get rich, not getting things done.

Databases have long-since solved the problem of storing and distributing data.

Distributed stores like etcd, zookeeper, and so on have long since solved the
problem of duplicating data.

Very few people need byzentine fault tolerance (due to having a large number
of untrusted actors with write access), which is the only time the additional
complexity blockchain includes is actually useful

~~~
the_stc
This. At my company, we want a way to show investors our actual revenue
numbers in an auditable manner, trustless. This is because we are
extrajurisdictional and have high opsec concerns and cannot simply hire an
accounting firm to give us an OK.

Hence we shall issue signed receipts to all clients and providers then setup a
system to pay out a large bounty if someone can produce a signed receipt not
in our weekly-published-log. We'll automate the bounty, but perhaps a third
party will also offer a validator. We will not even need Postgres for it, just
nginx and a filesystem.

But that is not interesting enough by itself, and mentioning digital
signatures just confuses people more. So we call it a Single-Issuer-
Blockchain: Now people instantly get the idea.

------
jhwang5
In general, it's a red flag to see people promoting some technology or idea
without concrete, end to end examples, and circular logic. It's okay for the
authors to make speculations, but I am disappointed at their excessive
handwaiving in answering just two simple questions.

a) Do "dapps" really to use their own tokens instead of USD or even ETH to
function? b) How are closed ecosystems that utilize "utility tokens"
benefitting customers? How are closed ecosystems better than open systems,
open protocols?

~~~
felipeccastro
a) they could use ETH, but if you launch your own token you get two
advantages:

\- funding (ICO) \- an economic incentive for attracting early users (give
tokens for using your app in the promise that they will be worth more in the
future)

b) if a user earns tokens that value over time, that's a huge win: imagine if
all the time you spend on apps today, generating valuable data to a few
companies, would generate in turn some of these tokens back to you?

Besides, what do you mean by "closed" exactly? The data being on the public
blockchain should actually encourage integration by default. For example,
several new dapps are being built on top of IPFS for data, using uPort for
identity, Aragon for governance, etc.

~~~
jhwang5
a) Or... wait for it... they could ask for payment in crypto, fiat, whatever,
rather than printing their own chuck-e-cheese tokens. Yes, we get it, ICO
allows the DAPP to fund itself, and it's a great value prop for the founders,
because they can raise capital on the strength of a 15 page paper, as opposed
to having real users.

b) "closed" means literally useless outside. Can you use your Cobinhood tokens
at any other exchange? No, it's because Cobinhood tokens are only good for
consuming the features of Cobinhood.

~~~
felipeccastro
a) what about the economic incentives for early users? That is a pretty huge
deal too, even if ICO funding wasn't possible.

b) it's not literally useless outside, you just have to exchange it for other
coins to use it outside. Isn't that how cash in most countries work too?
Besides, remember there's far less friction in exchanging app-specific tokens
by another coin than there is in exchanging cash today.

Even if app-specific tokens do not become standard in the future, it's an
interesting idea worth exploring. But the whole point is how different kinds
of business models can be created due to the decentralized nature of
blockchain, this is just one of them.

~~~
jhwang5
Regarding your b):

Yeah, you can trade your Cobinhood tokens for Binance coins, but this is an
artifact of the fact that each built a closed ecosystem. If both platforms
used the same currency (ETH, USD, whatever), then there'd be no need or the
inconvenience to trade tokens around.

Also, note, not all dapp tokens have liquid secondary markets, so I'd argue
that it's almost an exception that your dapp tokens can be monetized
externally

------
kang
Naval does a much better job of explaining what the tech is about :
[https://startupboy.com/2014/04/01/the-fifth-
protocol/](https://startupboy.com/2014/04/01/the-fifth-protocol/)

However, OP nor Naval, really understand the protocol, or wouldn't be
supporting non-blockchain things like ethereum (there is nothing that you can
do with ethereum but not with git).

>One of these developers, Vitalik Buterin, was frustrated by Bitcoin’s
immobilism

I am amazed at how HN is selling a promo story invented for media by ethereum
as a company. Digging IRC logs would reveal how Vitalik convoluted each aspect
of the tech(and was often wrong)to the point that the devs stopped caring and
let him be. Even technically, I have answered this on HN and other places
numerous times - tell me one thing you can build with ethereum but not with
bitcoin? (On the opposite, ethereum can't do money - mutable chain).

~~~
xorcist
Reading old logs may also reveal something about the project Vitalik had
before getting involved with Ethereum: Selling access to his quantum computer
... for mining Bitcoins.

Strange how the PR puff pieces around Ethereum never seem to mention this
project. Amazing also how the quantum computer seems to disappear as the pre-
mined coins were sold off.

~~~
krrrh
It was even weirder than that. He believed he could gain an edge on bitcoin
mining by simulating a quantum computer with a conventional computer.

[https://davidgerard.co.uk/blockchain/buterins-quantum-
quest/](https://davidgerard.co.uk/blockchain/buterins-quantum-quest/)

~~~
xorcist
That is a charitable interpretation. Had he truly believed in the concept
himself, why did he feel the need to hunt down millions of old dollars from
"investors"?

------
evanvanness
Lots of smart people in this space disagree with "fat protocols."

I'll immodestly list my own first:
[https://www.evanvanness.com/post/166666272011/theres-no-
such...](https://www.evanvanness.com/post/166666272011/theres-no-such-thing-
as-fat-protocols)

See also CoinFund's Jake Brukhman: [https://blog.coinfund.io/fat-protocols-
are-not-an-investment...](https://blog.coinfund.io/fat-protocols-are-not-an-
investment-thesis-17c8837c2734)

And Zeppelin's Teemu Paivinen: [https://blog.zeppelin.solutions/thin-
protocols-cc872258379f](https://blog.zeppelin.solutions/thin-protocols-
cc872258379f)

I hear that even Joel doesn't agree with how his piece has been interpreted.

------
45h34jh53k4j
Ethereum isn't useful for smart contracts; they are too expensive to call
methods on chain and EVM is too inflexible and bug prone.

The only use for ethereum is shittokens, and you could practically coingen
these for free, and trade forever. No load on the shared commons, isolate
activity to the specific coin. The only advantage is the ECR20 standard that
aids exchange integration.

SV is all a blaze about Ethereum, but I tell you, this too shall pass.

Long on other smart contract platforms, but not ETH.

~~~
taternuts
What other smart contract platforms are worth following?

~~~
Geee
Cardano.

------
geraldbauer
FYI: To learn about blockchains - why not build your own blockchains from
scratch (zero)? At the Awesome Blockchains [1] page I collect starter
blockchains (in JavaScript, Python, Ruby, etc.) and articles plus fun
blockchains (such as CryptoKitties and CryptoCopycats) [2]. [1]:
[https://github.com/openblockchains/awesome-
blockchains](https://github.com/openblockchains/awesome-blockchains) [2]:
[https://github.com/openblockchains/awesome-
cryptokitties](https://github.com/openblockchains/awesome-cryptokitties)

------
natural219
> Alternatively, the distribution of value in the blockchain paradigm can be
> described with fat protocols and a thin application layer. This paradigm
> shift is possible due to the innovation of cryptographic tokens.

As a long-time decentralization activist, this sentiment makes me want to tear
my eyeballs out. Why are cryptographic tokens necessary to implement fat
protocols? Why does "standardizing communication across applications" now
_also_ have to mean "implementing a global, secure financial market" in the
process?!? This is maddening to me and nobody has explained to me why
blockchains are a requirement to do this.

~~~
CryptoPunk
It explains in the two subsequent paragraphs:

>>“Historically the only way to make money from a protocol was to create
software that implemented it and then try to sell this software (or more
recently to host it)… With [cryptographic] tokens, however, the creators of a
protocol can ‘monetize’ it directly and will in fact benefit more as others
build businesses on top of that protocol.”

>>Previously, the creators of open communication protocols for the Internet,
largely DARPA researchers and non-profit contributors, could not align
financial incentives with protocol development. In contrast, protocol creators
today can issue “tokens”, like Bitcoin and Ethereum, that represent the value
of their decentralized protocols.

The key is that it can "align financial incentives with protocol development".

------
ThomPete
The negativity in this thread reminds me of the internet in the early
nineties.

If someone had said that one day there will be a company that does billions by
allowing people to fundamentally share their cat pictures and send each other
happy birthday messages people would have laughed their asses off.

The blockchain can be seen as a giant immutable feed. Make of that what you
will.

~~~
brandonmenc
It reminds me more of the P2P mania of the early 2000s - P2P was going to
decentralize and revolutionize absolutely everything, and well, it didn't. It
stayed in its narrow lane, providing benefits where it made sense.

~~~
ThomPete
Narrow lane? I think that's a matter of definition.

------
decentralised
Every time I see a Ycombinator article on Blockchain, I can't stop but feel a
bitterness from the years of nasty comments I got here when advocating for
Bitcoin, Ethereum and Blockchain technology here.

------
makomk
Anyone thinking of building anything on Ethereum should probably read and
comprehend this recent blog post from the folks at BitGo:
[https://medium.com/@lopp/the-challenges-of-building-
ethereum...](https://medium.com/@lopp/the-challenges-of-building-ethereum-
infrastructure-87e443e47a4b) There are many nasty subtleties and hidden traps
they learned the hard way that aren't obvious.

------
noellar
Hey,I would probably say the white paper for BitCoin is a good place to
understand what a blockchain does, I find the yellow paper for Ethereum more
useful for development. You probably want to run a private nodes for ethereum,
& a dev node for bitcoin, cheaper & no issues of space to experiment on both.
Genesis file for bitcoin is quite interesting for a soft fork. I've tried to
used both React & Meteor as webframeworks for a possible dapp..had more luck
with Meteor-:) Tried to connect heroku to a private chain as well..Got
distracted but it seemed feasible -:) Lots & lots of solidity code on github
by Ethereum developers & & even an open source framework to do static code
analysis for security -:) Lots of stuff on developers on bitcoin.org. Ethereum
has diff versions, so you want to look at the documentation for the latest
version byzatine, i think & it was also quite interesting thar they have
multiple clients in diff langs, i just started with one & got used to that -;)
Information from previous versions is also useful. Lots of altcoins are also
opensource so Good Luck building -:)

------
cturner
It is misleading to describe etheteum as Turing-complete. If it were, an
infinite while loop would soon crash the network. (As mentioned in the
article, the processing of Ethereum contracts is powered/funded by a finite
valuable currency called gas)

A novelty of the unfolding blockchain revolution is the realisation that there
is a world of interesting non-turing-complete things to be built. We all
assumed that anything non-turing-complete a waste of time. Surprise!

What you want to say here is that ethereum takes a large step towards creating
a flexible development platform.

EVM function like an instruction-set for this distributed computer. This may
be close to the way forward. But solidity is not. A quick port of JavaScript,
it is still in the old software mindset.

Ethereum has problems ahead of it. Just as C has an endless capacity to create
memory leak bugs, Solidity offers opportunity for contracts that will drain
people's accounts. Each time it happens, it will be reputational damage for
the community.

If you wanted to learn Ethereum, it might make more sense to start with raw
EVM than Solidity. Play at writing a macro assembler. Once you were tooled up,
you might try your hand at becoming the Brendan Eich of the blockchain. Until
you do, we are stuck with Brendan Eich.

If we do not find such an expression, general-purpose, public-access
blockchain will gain permanent mistrust, and fail.

Message-driven concurrency is here to stay though. I am building a concurrency
language centred around message-driven consensus-engines. (github.com/solent-
eng/solent) It is designed to be host-distributed, but operated by a single
party and not multi-party.

------
polkapolka
Articles like these should come with a disclosure: "the authors own bitcoin
and augur" or something to that effect.

------
krisives
You can write Solidity in the browser now using their Remix IDE:

[https://remix.ethereum.org/#optimize=false&version=soljson-v...](https://remix.ethereum.org/#optimize=false&version=soljson-v0.4.19+commit.c4cbbb05.js)

------
Crye
Here's my two cents. Is it a fad and a bubble? Most likely.

But do not discount value that the token creates as a network effect. Think of
the currency as an investment vehicle to reward people who jump on to the
network first. Consider Facebook, the first hundred customers are billions of
times more valuable then the last hundred.

Once this fad dies, people should start joining the networks they plan to use,
and early adopters will be rewarded for helping creating the network.

On top of that, it decentralizes the control of the network but temporarily
provides capital for it's creators. It does not ensure that their system will
belong to them in purpituity. Which is a good thing!

------
EricDeb
So far the main benefit is democratizing investment, as has been stated here
before. I love that I can get in on early stage projects without being a well-
connected angel investor. Coins are like new, sexier penny stocks.

~~~
m1sta_
The only reason this wasn’t possible in the past was because too many people
got ripped off.

~~~
EricDeb
Undoubtedly that will happen again, but maybe this time third party validation
systems will improve?

------
epberry
So this is exactly how I got started on a silly Ethereum side project over the
holiday. Truffle, solidity docs, and reading the crypto kiddies code is all
you need. I'm mostly interested in how Ethereum and other blockchain
technologies work - there's no denying that building a dapp is just a
fundamentally different experience from building a web app today and that in
itself is exciting.

I'm mostly _not_ interested in anything financial. Decentralization,
immutability, and a built-in way to pay for usage are the main features of
Ethereum (possibly combined with IPFS) that get me going.

------
ThomPete
ICO's are the equivalent of getting funding.

I think that the first successful blockchain based company won't be doing an
ICO but just launch it's token/coin because it has utility in itself.

------
siavosh
Blockchains, in part, provide the following value proposition:

Provable [X] without a central authority.

[X] can be the following:

Ex.

Currency - Bitcoin

Computation - Ethereum

Anonymous currency - ZCash

Storage - Filecoin

etc.

Most of us would agree that central authority is too strong in many aspects of
the economy and technology. The key question is for what values of [X] does
the value proposition make sense? The core technology is less than 10 years
old, anyone being too confidant in where this road goes should put it in a
larger timeline. Besides not losing your money, as hackers we can only explore
what may be possible.

~~~
Goladus
_Provable [X] without a central authority._

Under a limited set of conditions, with some cost [Y] to keep the system
running. The bitcoin network is extremely expensive, for example.

 _The key question is for what values of [X] does the value proposition make
sense?_

The key question is for what values of [X] - [Y] does the value proposition
make sense. And, what contextual conditions must be maintained to preserve the
decentralization advantages of [X]? In other words, the transactions could be
decentralized and anonymous but if you have to sign up for a centralized
exchange to participate, those benefits might be moot for you.

------
tramGG
If you're interested in the intersection of blockchain and AI/ML check out the
decentralized AI summit coming up on Feb 1st. [https://decentralized-
ai.com/](https://decentralized-ai.com/) there are going to be a ton of good
speakers and people into crypto/blockchain + IoT, Robotics, Autonomous
Vehicles, etc -- it's like the world's faire of the future.

------
tobiaslins
Lisk is a JavaScript based platform that allows developers to deploy and
develop their own custom blockchain, and decentralized applications.

It uses sidechains in the near future to fix the problems ethereum has at the
moment

[https://github.com/LiskHQ/lisk](https://github.com/LiskHQ/lisk)

------
vasilipupkin
I've wondered about the fat protocol concept. At the root of it, the token
that allows the developers to monetize their fat protocol has to make sense as
an investment. In other words, what are the investors getting when they buy
this token? why should they expect a return? this, I don't understand very
well.

------
mbrock
People are so upset about blockchain being useless.

Meanwhile I use it regularly to do business transactions from the command line
and shell scripts, which appeals to me greatly as a hacker who does business.

Open source finance! It's the future, guys.

Sorry about the speculative bubble. It's not really my fault though. Traders
and investors are a bit crazy.

~~~
banachtarski
You don't need a blockchain to "do business transactions from the command line
and shell scripts" so I don't find your personal counterexample particularly
compelling

~~~
mbrock
Which alternative are you referring to?

~~~
banachtarski
Any of the available stock, forex, merchant, payment APIs anywhere. You have
zillions of options (stripe, etrade, paypal, a bunch of banks have APIs, soon
you'll have a Venmo API, other payment applications are coming up). The notion
of a scriptable transaction has literally nothing to do with a blockchain.

~~~
mbrock
Those aren't as convenient for me as blockchain, and of course they all
involve centralized counterparties with proprietary APIs. As far as I know
there is no bank in my country with a usable API. Blockchain is just a nice
and easy open source solution that works great worldwide.

------
Toine
Contrarian approach to this article : is there a way to short Bitcoin, and
other "cryptocurrencies" ?

~~~
elmar
yes, just borrow Bitcoin and sell it for fiat and when the repayment is due
just buy Bitcoin again, you are basically "short selling" it.

------
jaequery
Where I can see blockchain being more 'actually' useful is in simple things,
like verifying the integrity of the app (or anything really), ala checksum
hashes.

It makes a lot of sense for us to store them on the blockchain rather than
hosting it on a webpage.

~~~
nileshtrivedi
You need blockchain only when you want to prevent double spending of
_something_. A linked list where only one node can have a valid pointer to the
previous node.

For checksum hashes, unless double spending is a problem, IPFS will suffoce.

~~~
patrickaljord
You don't need a blockchain to prevent double spending. You only need a
blockchain if you want the double spending prevention to happen between
trustless distributed peers.

~~~
jhwang5
You are right, and I think this aptly captures just how misunderstood
Blockchain is even on this forum.

~~~
nileshtrivedi
I used "only when". It's a necessary, but not sufficient, condition.

[https://en.wikipedia.org/wiki/Principle_of_charity](https://en.wikipedia.org/wiki/Principle_of_charity)

------
m3kw9
Inevitably because of the ICO component, there will be a lot of applications
that tries to use block chain to search for a problem to solve more
inefficiently than not using block chain. With the main idea so they can get
the ICO to work for them.

------
thisisit
I stopped after reading this:

> “Historically the only way to make money from a protocol was to create
> software that implemented it and then try to sell this software (or more
> recently to host it)… With [cryptographic] tokens, however, the creators of
> a protocol can ‘monetize’ it directly and will in fact benefit more as
> others build businesses on top of that protocol.”

And what was wrong with developers finding a market, developing a software and
then monetizing it? I have tons of ideas each day, some of them blockchain
related too but it seems unethical to use other people's money to test my
hypothesis.

~~~
rrecuero
We were talking specifically about protocols like TCP, IP, DNS or even P2P. It
was nearly impossible to monetize protocol level work before cryptocurrencies

------
ersiees
What about the problem of competitors copying your contract? Since all
blockchain code is open. Isn't that a real problem developing Dapps?

------
alexpetralia
'Albert Wagner' should be 'Albert Wenger'

------
nickporter
Bitcoin whitepaper url is broken.

------
blockgeeks
Thanks for the article and the shoutout to blockgeeks!!

~~~
vincentschen
thanks for the resource!

------
decorator
Ethereum isn't decentralised to a large degree (see the DOA). Given such a
thing, one may as well use a standard web stack.

Also, that makes any guides written for devs on the subject of negative
utility. It wastes their time; since the premise, that the new paradigm
derives its value from censorship resistance, is breached.

It takes some serious non-thinking to support Ethereum. The price is high, the
value is low.

