
Systems built on trust, norms, and institutions function better than blockchain - petethomas
https://medium.com/@kaistinchcombe/decentralized-and-trustless-crypto-paradise-is-actually-a-medieval-hellhole-c1ca122efdec
======
cowpig
> Venmo is a free service to transfer dollars, and bitcoin transfers are not
> free

Venmo is not free. There's a cost, it's just hiding.

> Blockchain-based trustworthiness falls apart in practice...

The particular brand of trustworthiness the author is arguing against is
indeed a myth, but that doesn't mean blockchain is "crappy technology" or "a
bad vision for the future"

Blockchain adds a new thing to the world: digital property that cannot be
reproduced for free.

Smart contracts add another new thing to the world: the ability to build
immutable software that interacts directly with the financial system.

Both of these ideas are very powerful, and almost all of the interesting
blockchain projects are still in the R&D phase.

The hype around blockchain is ridiculous and absurd, but that doesn't mean the
technology isn't exciting or potentially transformative.

edit: I actually wrote an article about the "trustlessness" thing:
[http://cowpig.github.io/bitcoin/ethereum/poker/cryptocurrenc...](http://cowpig.github.io/bitcoin/ethereum/poker/cryptocurrency/trust/economics/game-
theory/2018/01/29/Trustless-Myth/)

~~~
spookthesunset
> digital property that cannot be reproduced for free.

Sure, all through the magic of using a medium sized country's worth of
electricity....

> Smart contracts add another new thing to the world: the ability to build
> immutable software that interacts directly with the financial system.

"Immutable" as in "immutable up until the folks at the top decide to alter
history to benefit themselves financially". See also - Ethereum & The DAO.

> and almost all of the interesting blockchain projects are still in the R&D
> phase.

Bitcoin is more than 10 years old. It is a mature tech that is still in search
of a problem.

~~~
vageli
> Bitcoin is more than 10 years old. It is a mature tech that is still in
> search of a problem.

I don't understand how this can be said with a straight face. Aeronautics,
ballistics, these are examples of mature tech. I can't think of a single
example of technology that was considered mature after a mere ten years.

~~~
spookthesunset
Bitcoin is a data structure. It isn't like the invention of flush toilets, the
standardized shipping container, or sliced bread.

It's been on the market for 10 years and so far its only use seems to be a
great way to run pump & dump penny stock scams....

~~~
dorgo
And the first plane could fly a distance of 60 meters after 10+ years of
developement..

~~~
hndamien
And we went to the moon literally 56 years after that (the years of
development).

------
tCfD
Blockchain is actually a technological shadow cast by a sociological
proposition, which is then you can trust people to voluntarily deprive
themselves of leverage for the sake of the greater good.

Blockchain is essentially a tool for measuring how much leverage different
nodes have in a network system. All of the functional premises of blockchain
depend on the assumption that the only leverage that exists in a blockchain
network is that which can be represented by the various metrics exposed by the
protocol. Obviously this is not the case, networks are often stacked with
multiple layers, not all of which are visible to instrumentation, and many are
deliberately hidden or informally created as the opportunity arises. Cliques
form, whether by design or merely as a consequence of some underlying
structure or geometric boundary domain, influence builds around them, and
sooner or later someone finds the ideal geometric position from which they can
become the center of decentralisation.

This is essentially another instance of goodhart's law, which states that the
moment any given metric becomes a useful target for optimization, it ceases to
be a useful measurement. Or another variation of this same observation, the
McNamara fallacy, which can be summed up as the belief that the only factors
in a system that count, are those that can be counted.

------
gtrubetskoy
The problem that proof-of-work blockchain solves is widely misunderstood. It
uses proof-of-work to establish consensus over points in time which are
universally unique. Prior to the publication of Satoshi's paper we did not
have a solution to this problem and for that reason it is a significant
advance in technology. I wouldn't call it crappy, it's actually quite
brilliant.

For a detailed description see this:
[https://grisha.org/blog/2018/01/23/explaining-proof-of-
work/](https://grisha.org/blog/2018/01/23/explaining-proof-of-work/)

~~~
monochromatic
It’s very interesting as a matter of pure technology. I’m just not sure it’s
that useful as a banking system.

~~~
specialist
IMHO, banking & finance are its least interesting potential use cases.

\---

Medical Records

Mid aughts, I was trying to figure out how to use tamper evident logs (rolling
hashes) for our electronic medical records infrastructure. To answer questions
like "what did you know and when did you know it?" and "where did this bad
data come from?"

Coupled with the notions for Translucent Databases (all data at rest is
encrypted) to protect privacy.

We hadn't even gotten to the consensus and trust issues.

\---

Authenticity

I'm now most interested in verification of sources.

Where did this cotton or wheat or cobalt come from? Are these pills authentic?

Is the data cited by this paper legit?

Verify copyrights, perhaps even a realization of Ted Nelson Xanadu's notions
of transcopyrights. (Disney's DragonChain and others have floated those use
cases.)

Is this news report real or agitprop? Is this quote actually legit?

Did someone(s) silently update some published information?

Etc, etc.

\---

Tursted Rules & Constraints Satisfaction

Since seeing a presentation on using ethereum style smart contracts for
medical claims processing, I've been reading up.

I can barely wrap my head around this stuff. Computability, Turing complete, N
vs NP, etc. But the domain experts I heard told a great narrative, so now I'm
interested too.

~~~
spookthesunset
All of this is hype. Blockchain is only useful when you bolt a speculative
asset on top because otherwise, who the heck will pay for the miners to make
it work? If your answer is "the people using it will", that means there is
already enough trust in the system to just use a Real Database....

And even if you manage to solve that problem, the blockchain still doesn't
help with medical records, authenticity or anything else. You still have to
trust the people entering those records. you still have to trust that the
person who said "those pills are authentic" on the blockchain.

Smart contracts are also the biggest pile of hype. You can't have "code is
law" because other wise you wind up with The DAO.... All code has bugs. All
code has corner cases where assumptions fall apart. You can't code law.

Blockchain is pure, 100% hype. Almost every single use case falls apart under
even a small amount of scrutiny. The only use the blockchain serves is as a
platform for fraud. If you are a scammer, there is no better place to be than
in crypto.

~~~
specialist
FFS.

It's turtles all the way down, right?

None of my proposed use cases rely on PoW, bitcoin.

Perhaps I should have said it more clearly: I'm not interested in currency et
al, because best as I can tell, bitcoin is just a better escrow, or worse a
collectable (like baseball cards). And those things don't interest me.

\--

Have you done accounting, bookkeeping, auditing? Another way to think about
blockchains is an interoperable ledger. If your data doesn't leave your org,
you can just using tamper evident logs (rolling hashes), no consensus stuff
required.

I worked on election integrity issues for a decade. I'm the biggest
technoskeptic. I pretty much oppose all things new until they're battle
proven.

The biggest challenge for election administration is verifying and publishing
the physical chain of custody of all the gear and materials. And no matter how
hard you try, there's always some yahoos (flat earther types) that will demand
ever greater proof.

Whaddya gonna do?

Well, based on my experience, applying some blockchain technologies to
document and publish chain of custody would simplify A LOT of the public
accountability and transparency issues.

At the end of the day, it's just double ledger accounting. Debits match
credits. The parts of blockchain that interest me make it easier to "show your
work".

~~~
nickpsecurity
What you're describing are hashchains and logs that predate Bitcoin. They're
useful. They might even be _part_ of the solution to the problems you were
talking about. Here's some old ones just to illustrate that people have been
on the topic for a while.

[https://www.cis.upenn.edu/~ahae/papers/peerreview-
tr2.pdf](https://www.cis.upenn.edu/~ahae/papers/peerreview-tr2.pdf)

[https://eprint.iacr.org/2005/002.pdf](https://eprint.iacr.org/2005/002.pdf)

[http://citeseerx.ist.psu.edu/viewdoc/download?doi=10.1.1.625...](http://citeseerx.ist.psu.edu/viewdoc/download?doi=10.1.1.625.417&rep=rep1&type=pdf)

And here's you a blockchain-based solution to medical sharing since you said
you were looking into such things.

[http://ieeexplore.ieee.org/stamp/stamp.jsp?arnumber=7990130](http://ieeexplore.ieee.org/stamp/stamp.jsp?arnumber=7990130)

~~~
specialist
Thank you.

Those papers are from about the same time frame, but I don't immediately
recognize them. I do remember the implementation I modeled mine after was
patent encumbered.

I may have adopted "tamper evident logging" because I was talking to a lot of
non-geeks at the time and they were familiar with terms like "tamper evident
seals".

That MeDShare paper is kinda weird. We were very fortunate to have domain
experts (nurses, doctors, admins) on staff. So what we ended up with (after a
few years) didn't look much like what MeDShare proposes. For example, access
control is a non-starter, because in an emergency no one cares about
permission. So the best we could do is log access. Also, demographic data at
rest is plaintext, because in the USA there's no GUID, so you need access to
all the fields to do record matching (linking) and mitigate poor data quality.

Repeating myself: my interest in tamper evident logging was for legal
liability and improving our own QA/test.

I haven't thought much about all the other areas blockchains could be used in
medicine, like prescriptions.

------
aalleavitch
In many ways, blockchain tech is the stupidest thing that has ever existed. It
is a colossal monument to the inefficiency of human behavior. You are
literally throwing energy and immensely valuable computation time out of a
window simply because people can't trust each other. It is a massive sink for
the destructively self-interested behavior of mankind. The problems that
blockchains are trying to solve are not inherent difficulties involved in the
tasks that they're being applied towards, they're problems with us. We can
design an astronomically more efficient system for accounting, but it would be
have to be one that is not being run by stupid, short-sighted apes. The entire
overhead of the blockchain is devoted to dealing with a problem that we
shouldn't even have, the whole thing is basically made of market failure. If
there's any value in it, it's that we can use it to establish objective
metrics for just how much value is destroyed by human irrationality and
information deficits. We don't need to fix centralized accounting, centralized
accounting works fine. We need to fix human beings.

Meanwhile, imagine if every GPU used for mining right now was being used for
training neural nets instead. The value in that is nearly unimaginable; we
could be making massive leaps in almost every field and industry, because the
applications of deep learning to making tasks marginally more efficient are
essentially endless.

~~~
mido22
FYI: when you talk about GPU/mining/energy, you are talking about Proof of
Work (pow) and not blockchain. You can look up about Proof of Stake among
other ways for consensus

~~~
aalleavitch
Even just the concept of the blockchain itself is based on a massively
inefficient use of resources to have a public ledger that can't be tampered
with. This wouldn't be an issue at all if people just didn't have incentives
to tamper with it!

~~~
dorgo
>This wouldn't be an issue at all if people just didn't have incentives to
tamper with it!

:O, the only possibility for that which comes to my mind is a world in which
everybody is infinetly rich?

~~~
webmaven
Even that would only address _financial_ incentives (and just the _rational_
ones, at that). There are - unfortunately - others.

------
phasnox
Gotta love how he begins saying he was bashing the tech in December(when the
market was on the rise) just so that no one can tell him "everyone bashes
bitcoin when it's going down".

Venmo is centralized. I cannot use it as I live in a third world county with
no access to it.

Paypal sucks. It takes 5% from the seller and it has power over your money,
they can(AND HAVE IN THE PAST) seize it whenever they want.

I had my salary confiscated once over a mistake in the bank. I telecomute,
working for a company overseas, and the fees are stupidly high.

I find your lack of vision disturbing.

~~~
fhood
You know, paypal may well suck. I have never used it as a developer or a
seller, but I really, really, like to have it as an option when I am
purchasing something from some rinky dink website that doesn't look like it
has been updated int 10 years.

~~~
aianus
Sucks for the buyer too. Ever tried to use PayPal (or credit cards for that
matter) to buy something from the US with a Canadian shipping address while
you're living in Vietnam with a Vietnamese IP address? I did; I got fraud
blocked.

~~~
fhood
Haha, no, I am one of those annoyingly generic users. But honestly I kind of
expect them to block that. That seems pretty suspicious at first glance.

~~~
webmaven
Why suspicious? Simply because it is out of the ordinary?

Fraud detection systems basically have most of their feedback mechanisms
geared toward reducing - even eliminating - false negatives, and very little
attention comparatively given to false positives as long as no individual
merchant notices a measurable drop in sales.

Meanwhile, a hapless individual might have _many_ of their purchase attempts
foiled as false positives, and be left with little to no recourse (well, I
suppose their complaint on Twitter may go viral, that does seem to work
occasionally with ebay).

------
localhost3000
"Instead of relying on trust or regulation, in the blockchain world,
individuals are on-purpose responsible for their own security precautions. And
if the software they use is malicious or buggy, they should have read the
software more carefully."

This is also one of the aspects of "the blockchain" that I struggle with. I
don't think normal people want this or should be expected to do this
effectively. And once you outsource the security (which most everyone will
because it's the rational choice, e.g. Coinbase is better at protecting your
crypto than you are, John Q Public.) you're no longer in a "trustless" state.
The "trustless" pipe-dream (in the consumer use case) all sort of unravels
from there for me.

~~~
zodiac
> And once you outsource the security you're no longer in a "trustless" state.
> The "trustless" pipe-dream (in the consumer use case) all sort of unravels
> from there for me.

I think the conclusion doesn't follow. An analogous solution is that
traditional public-key cryptography (e.g. as implemented in TLS) is supposed
to be trustless, but I haven't personally audited or even read any of the
relevant code (e.g. TLS), so I'm "not in a trustless state". It doesn't follow
that TLS is useless for me.

~~~
manbart
TLS relies on trusted certificate authorities though. I don't think it was
ever intended to be trustless, in fact you specifically get warnings when a
trusted certificate authority cannot be found for a given cert.

~~~
zodiac
I was actually referring to the transport encryption which is designed to be
"trustless" (but which, as you point out, is distinct from the digital
certificates part)

------
kaolti
One thing is sure, if you're hanging on to the past you'll always lose in the
end.

That's not to say blockchain is the be all and end all, but constantly hunting
for arguments why something will never work , is not only terribly boring, but
IMO the most counterproductive way to look at anything.

~~~
toomuchtodo
> That's not to say blockchain is the be all and end all, but constantly
> hunting for arguments why something will never work , is not only terribly
> boring, but IMO the most counterproductive way to look at anything.

I don't believe this is the same as discrediting solutions looking for
problems. Blockchain proponents desire a technical fix to people problems.
That is untenable, as people will always override software, whether that's
through a courtroom, a government/regulatory body, or a fork based on majority
consensus.

~~~
moccachino
Ah, but that is only temporary. The ultimate technical fix to people problems
will eventually prevail, making you all obsolete. Erm, I mean us all, us
humans, all of us human people of which I totally am one.

------
kixiQu
Wow--it's both amazing to me and yet deeply unsurprising that the comments
here so far seem to ignore the thrust of the article. Well, whatever--I like
how it makes explicit the political theses embedded in current discussion of
an "apolitical" technology.

------
api
I think the author of this article is making an either/or argument about
centralized vs. decentralized trust when this can just as easily be a both/and
proposition.

Cryptocurrencies have not yet eliminated and may never eliminate the need for
centralized reputation based systems of trust. Centralized trusted systems are
more efficient for reasons that may be fundamental and rooted in physics and
math, and they can do things that no current generation decentralized system
can do. Complex secure computations that are cheap to perform on a server are
massively expensive on a block chain or other distributed system.

Yet what cryptocurrencies _do_ offer is a system that levels the playing field
between trusted entities and allows a once-trusted but now corrupt entity to
be replaced without completely ditching the entire system. That's not true of
things like centrally banked fiat currencies. If the current US financial
system becomes irredeemably corrupt, this can't really be fixed without
risking the destruction of the dollar and all assets and contracts denominated
in dollars. A new dark age is a very high price to pay for the replacement of
a corrupt or incompetent system.

I think an argument can be made that replacement of institutions will always
be necessary at some point. As institutions become large their size insulates
them from reality, allowing something like "genetic drift" to occur that
gradually erodes their competence. Combine this with the fact that psychopaths
gravitate toward positions of power and you have a general tendency of large
powerful systems toward decay and corruption over time.

We saw a very concrete example of this in 2008 when banking institutions that
had failed badly due to a mixture of incompetence, hubris, and corruption
received a blank-check bailout on the backs of taxpayers and the rest of the
non-financial economy. It is no coincidence that cryptocurrency went
mainstream right after this, since these events demonstrated the need to start
thinking about ways to devolve power away from these systems or at least to
reduce the cost of doing so.

Side note: I think we've officially entered the cryptocurrency / block chain
trough of disillusionment. See:
[https://en.wikipedia.org/wiki/Hype_cycle](https://en.wikipedia.org/wiki/Hype_cycle)

------
stale2002
> I would assert that there is no single person in existence who had a problem
> they wanted to solve, discovered that an available blockchain solution was
> the best way to solve it

What about Wikileaks? They had all their payments shutdown and then they were
able to start accepting payments.

The "use case" for Bitcoin was stated up front. It is to allow censorship
resistant transactions. And for Wikileaks in 2010, when their financial
transactions were being censored, it worked!

~~~
cinquemb
I think skeptics of cryptocurrency get too focused on applying cases where
their traditional banking systems serve them well, rather than how such
systems do not serve marginal actors very well (or at all, for whatever
reasons).

Cryptocurrencies don't need to appeal to mass market users who are already
happy with what they have.

Appeals to legality (without stating jurisdictions or enforcibility), cries of
rampant speculation (without acknowledging how much speculation already occurs
in many kinds of markets and financial instruments), doesn't really matter to
those who are now enabled to do something in a way that they couldn't before.

People using cryptocurrencies today to engage in various forms of trade
valuable to each other, don't care what people on the sidelines think.

------
ty_a
Blockchain is perfect for its original use case, a distributed trustless
database. The tradeoffs don't make any sense for a trusted system, i.e.
replacing SWIFT or storing titles to property.

~~~
jeremyjh
All the evidence to date suggests that banks are much more capable of
providing useful financial services than blockchains. Can you give a counter
example of a real world use?

~~~
slededit
I moved from the US to Canada. Banks wanted to hold my transferred money for a
month even though they got the cash within 3 days.

with cryptocoins I wouldn't have had to move the money at all.

~~~
wsy
So why didn't you convert your USD to Bitcoins, move, then convert your
Bitcoins back to CAD as you needed CAD?

~~~
slededit
I kept the money in kind. It was merely transferred from bank to bank.

FWIW I kept my BTC in kind as well.

------
he0001
This article highlight a really interesting point here:

Trust.

And even if there are the “proof-of-work” people are going to distrust that
“it’s a mathematical proof”. Just look at Trumps alt-facts and “fake news”.
You don’t need to go even that far to find people putting money under the
mattress because they distrust authorities. And even if math is “universal”
people are going to mistrust it because they don’t understand it. I don’t
think they will ever trust bitcoin. And I think they are in a majority.

~~~
webmaven
And when the mattresses are being stuffed with fiat currency, the utter _lack_
of cognitive dissonance becomes striking. To a lesser degree, the same goes
for "keep the government out of my Medicare".

------
RIMR
>In fact, I would assert that there is no single person in existence who had a
problem they wanted to solve, discovered that an available blockchain solution
was the best way to solve it, and therefore became a blockchain enthusiast.

I would say that every person running a darkweb drug market would disagree...

~~~
jstarfish
Blockchain isn't _necessary_ for that. All you need are some shitty PHP pages
behind a Tor hidden service and an escrow agent to facilitate transactions.
The currency doesn't matter and it certainly doesn't have to be Bitcoin--
prepaid Visa cards work just as well, and are more anonymous than Bitcoin
anyway.

------
antiffan
I'm seeing more of these "anti-blockchain" criticisms circulating lately. This
one makes valid points about problems with the present state of the ecosystem,
but the author seems to ignore the fact that these problems are addressable.

His basic criticism of smart contracts is they can have bugs, and they can be
costly since they will often involve moving money. Yes, this is a fact. Many
potential solutions are out there, but how about these two ideas for starters:

\- a crypto-currency where at least accounts for certain transactions can be
de-anonymized, so a person can be identified and face consequences when they
commit a crime like hacking.

\- special transactions with settlement periods in which they can be canceled
in the event of a hack, which might be identified by voter consensus.

------
l8again
I honestly thought the author was trolling us (until I read the comments).
There are so many holes in his example of ebook transaction. Here's just the
two points he made that were the most egregious to me:

>> and that the book — rather than some other file, or nothing at all — will
actually arrive

Really? Ever heard of checksums - its used all over the place. And if we
weren't able to trust it, I guarantee you that blockchain tech is not the only
thing that will break.

>> It’s a complicated way to buy a book! It’s not trustless, you’re trusting
in the software (and your ability to defend yourself in a software-driven
world), instead of trusting other people

It's like arguing with my grandma about evolution. "But you are trusting the
scientists!!". I don't know where to begin.

~~~
eridius
How are you supposed to checksum the book before you have it? You can't do
that without trust, because you need to trust someone to give you the right
checksum.

~~~
webmaven
Not quite that dire: The checksum is typically public, where a large set of
diverse stakeholders (most of which have incentives aligned with yours) can
publically dispute it's veracity, increasing the costs of fraud. Moreover,
some of those stakeholders may already be part of your existing circle of
trust (either directly or transitively), which increases uncertainty for
fradulent sellers.

~~~
eridius
Name me a single eBook you've purchased where the checksum for the eBook was
public.

------
lev99
I read the bitcoin whitepaper about 7 years ago. I find it funny when people
talk about blockchain like it's new technology, or like it's a vision for
future. It's old tech that has been generally increasing in market value.

~~~
xtracto
Exactly, Blockchain is now 10 year old technology, with a lot of
implementations and technologies built over it.

TCP has its root in 1974 technology [1], and it was not until the early 90's
that it started showing its potential.

The key to Blockchain technolgoy is the proposal of what it can solve (trusted
transactions in a trustless environment). I like to see Blockchain as TCP/IP:
It is going to be the foundation of bigger and more "user friendly" protocols
and systems. (golem.network, storj, filecoin, eos). At some point we will get
the "HTTP" of Blockchain, and over that, we will start having the "Google"s
and "Amazon"s spawning as well. But if you think that, it took Amazon 20 years
(1994) before TCP was "invented"... then the timing for Blockchain technology
is going quite well.

[1]
[https://web.archive.org/web/20160304150203/http://ece.ut.ac....](https://web.archive.org/web/20160304150203/http://ece.ut.ac.ir/Classpages/F84/PrincipleofNetworkDesign/Papers/CK74.pdf)

------
atomical
Blockchain consensus algorithms are slow and use a lot of power. There may be
competing technologies, like Hashgraph, that solve speed and power usage
issues in the future. As of now all live implementations of blockchain are
underwhelming.

~~~
cgopalan
Not all. I think you are specifically talking about Bitcoin (Proof of Work)

~~~
atomical
What live implementations are using POS (Poof of Stake)? It's all academic and
likely to be only marginally faster without a lot of risky optimizations.

~~~
MaxKK
Lisk, Nxt, Bitshares and dozens of others.

~~~
atomical
From what I'm reading Lisk only supports 25 transactions per second.

------
laktek
As someone born and lived in a 3rd world country for a better part of my life,
I believe Blockchain solves a very real problem. That's equal participation in
internet economy irrespective of someone's geographic location. It was thanks
to the internet I realized I can also contribute to the world (by creating
something people want & writing about something others want to learn).
However, when it came to making a living out of that there weren't many
options. One of the prime motives for me to move out of Sri Lanka was it will
be way easier for me to accept payments online.

PayPal is still not available in Sri Lanka, even after repeated attempts to
convince Central Banks and governments [1]. Also, recently Stripe blocked a
payment from one of my customers due to high-risk profile. Reason? He used a
US issued debit card from Nigeria. I reached out to the person, turns out he
was a passionate young entrepreneur who was trying to build a really
interesting business. But his geographic location becomes a resistance in a
medium it shouldn't.

For me, Blockchain( and Cryptocurrencies) is a reframing of the trust model
from heuristics such as geographic location to verifiable algorithms. The
Internet protocols enabled us to exchange code, art & virtual goods without
geographic boundaries. Then why not money?

[1] [https://www.change.org/p/enable-receiving-money-to-sri-
lanka...](https://www.change.org/p/enable-receiving-money-to-sri-lanka-
through-paypal)

------
ecocentrik
Blockchains are accounting mechanisms. In their simplest form, blockchains are
just a linked list of linked lists that that fulfill the requirements of an
easily immutable, distributed and auditable system of accounts.

I'm not sure how the author is attributing so much doom and gloom to
cryptographically secured accounting systems, some of which have survived for
a decade without a major failure of their primary function (securing digital
assets with enforceable contractual conditions and private keys).

------
AlexCoventry
> I would assert that there is _no single person in existence_ who had a
> problem they wanted to solve, discovered that an available blockchain
> solution was the best way to solve it, and therefore became a blockchain
> enthusiast.

He hasn't been paying attention to the space long enough: Many traders in
contraband meet that description, and used to talk about it at length in
r/darknetmarkets, before it was banned. (BTW, does anyone know where they hang
out, now?)

~~~
floatboth
Contraband markets, ransomware authors, and scammers. The world is wasting
power on hashing to support _that_.

~~~
AlexCoventry
The consensus doesn't have to be based on PoW. Almost all interesting
cryptocurrencies (well, interesting to me) use or plan to use proof-of-share
mechanisms.

Check out Algorand, for instance: [https://www.algorand.com/how-it-
works/](https://www.algorand.com/how-it-works/)

------
yk
A few month ago I clicked through quite a few youtube [0] lectures on "system
dynamics," the 1960ies hype technology, and the people who did system dynamics
back then are entirely reasonable, well aware of its limitations and the
applications are very interesting, but their work got completely drowned in
bullshit. Very similar to "the Internet" in the late 90ies, "web 2.0" in the
early 2000nds and block chain today.

So block chain is a really cool algorithm, that under ideal conditions can
solve the Byzantine Generals problem, but there is at the moment just so
incredible much bullshit surrounding blockchains, that it is sometimes hard to
separate the wheat from the chaff.

[0]
[https://www.reddit.com/r/lectures/comments/7jtg5e/dennis_mea...](https://www.reddit.com/r/lectures/comments/7jtg5e/dennis_meadows_perspectives_on_the_limits_of/)

r/lectures thread, see the videos linked in the comments.

------
tshannon
I agree that it'll be hard, if not impossible for bitcoin to work as well as
normal systems built on normal trust. However I think we increasingly do need
some system of verifiable trust in a world where anonymity is common, since
all current forms of trust require it's participants to not be anonymous.

------
ruduhudi
I think he is absolutely right about his dystopian view on smart contracts
managing stuff but forgets about that one trusted party we're trying to avoid
the most here, that costs us the most money and that we need the least in real
life: Banks. That's what we neet the blockchain for.

~~~
Barrin92
I never understood that sentiment. What exactly is bad about banks? Banks are
a trusted middle-man that controls, insures and manages my transactions, and
in contrast to arcane technological blockchain solutions is actually a legally
liable entity.

I also don't understand how banks cost me more money than bitcoin. A bank
transaction costs me very little to no money, a crypto-currency transaction is
extremely expensive.

~~~
jstarfish
For better or worse, banks are treated like the Ticketmaster of the financial
industry.

The new-age solution to this seems to be sticking it to them by conducting all
your business with scalpers.

------
sametmax
The TL;DR is:

\- blockchain systems still need trust;

\- security is not solved;

\- blockchains are overhyped and most followers don't want it for the problems
serious actors try to use it to solve.

\- it has many issues (need for infra, require tech knowhow, etc)

I agree, but I still don't see how it's crapy tech, nor how it's a bad vision
of the future.

You have an system that make auditing easier, with one place only for the data
to be read and written and yet robust enough because of the duplication.

You have transactions logs tided to identities you can fake organised in a
timeline in an open format that is not only very well documented, but being
actively tested right now on the field.

You have hundreds of start up engage in a Darwinism race to find out which use
case we can make that's worth it on the long run.

And finally, the tech has enough impact to force state actors to create new
laws, financial actors to adapt and a huge amount of money to be invested by a
lot of people.

So on one hand one very interesting concept. On the other hand, pretty much
hate for the sake of hate.

------
abalone
If you love this you should also follow @sarahjeong. Hilariously eviscerates
cryptocurrencies for sport.[1] Smart (Cal + Harvard law), unafraid and one of
the best up-and-coming tech journalists IMHO.

[1]
[https://twitter.com/sarahjeong/status/953419544516747264](https://twitter.com/sarahjeong/status/953419544516747264)

------
lcooper
The blockchain is not currently fit for most "real world problems", because
the way it achieves consensus and performance, but there are initiatives like
the one below to change that:

[https://github.com/Azure/coco-framework](https://github.com/Azure/coco-
framework)

------
mattdemon
Relevant article. Replying to why decentralization matters

[http://muratbuffalo.blogspot.com/2018/03/change-my-mind-
abou...](http://muratbuffalo.blogspot.com/2018/03/change-my-mind-about-
why.html)

------
tim333
The feature of things like bitcoin that they operate largely outside
government control may be useful for things like raising investment in ICOs.
While many are rubbish there may be some useful stuff in there.

------
cvaidya1986
It’s going to be interesting reading these articles ten years from now.

~~~
coldtea
It's already interesting reading articles about how Bitcoin would be
dominating already by now written several years ago...

Are we going to wait much longer for the Rapture?

~~~
cvaidya1986
[https://www.bloomberg.com/news/articles/2018-04-06/george-
so...](https://www.bloomberg.com/news/articles/2018-04-06/george-soros-
prepares-to-trade-cryptocurrencies-as-prices-plunge)

~~~
coldtea
Yeah, that proves bitcoin's bright future /s

~~~
cvaidya1986
Wealthy investors trading in the market is an indicator out of several
indicators to consider.

------
jiveturkey
stopped reading after the intro. this is a guy who is a self-proclaimed
luddite and who likes to hear the sound of his own prophetic voice. i love how
he emphasized his own words in a “callout”, immediately after the inline text.
magazine style. sensible in magazine format. but in a blog? puh-leez.

his opinion is not worth debating, even if there is a kernel of truth there.

------
drb91
Shockingly, technology has multiple uses, some better fits than others.

I think you’re crazy if you buy crypto unless you’re buying drugs, but this
man’s lack of imagination wrt a no-trust public record is absolutely boring.
Sure, if you’re blind, the world is dark. But we can always close our eyes to
pretend—it’s never been difficult to be cynical about technology.

------
blueprint
Why is it that whenever this guy says something's wrong with "blockchain",
every example he gives is about something other than a blockchain? Like
exchanges and smart contracts. Those are not the same thing as Bitcoin and
Monero.

------
Kiro
HN seems to have a bipolar relationship with decentralization. It's all love
until blockchain is mentioned. Then everyone thinks centralization is
superior.

------
nautilus12
Another y-combinator contrarian post of the form "the thing everyone likes is
actually crap."

Fortunately for the author I happen to agree with this particular thesis.

~~~
taylored
"contrarian"

------
EGreg
I actually _like_ the way this author deconstructs what a blockchain
technically is and how it’s sold. And I agree on many points.

However, this is where they go awry:

 _Instead of relying on trust or regulation, in the blockchain world,
individuals are on-purpose responsible for their own security precautions._

THIS is the revolution. And the revolution will not be centralized :)

Blockchains are just one example of it. Kademlia trees and close consensus is
another, used by SAFE network. Go look it up.

The whole POINT is, it is very _hard_ not just for someone to tamper with a
file, but to cut off access to it. Crypto-currencies also have the added
requirement of preventing “double-spending”, which is very hard to do.

EXAMPLE: Why trust the landlord to have keys to open your apartment instead of
an electronic lock that lets you set permissions YOURSELF? Use your phone to
authenticate yourself instead of facebook controlling it. “Oh what if I lose
the phone?” “Then have a backup.” “What if I lose everything?” “Then have M of
N friends plus a key derived from a passphrase you know to restore it.” “Ok
what about if I get amnesia and lose my phone?” “This is 0.00001% of the
population and even Jason Bourne implanted a chip in his own ass.”

This guy doesn’t live in a country where the institutions people rely on have
routinely screwed people. The solution is usually “throw more Democracy at
it”, which is what can lead to totalitarianism.

Ever read “fuck the cloud”? It’s a good read. Why SHOULD I pay someone I don’t
know to store all my files, and delete my local copies?

[http://ascii.textfiles.com/archives/1717](http://ascii.textfiles.com/archives/1717)

Have you all seen just recently what Facebook does? Why would I entrust my
data, identity and brand to them?

Have we seen websites censored or DDOSed? Or just broken links to useful
stuff?

SAFE network and Freenet etc. are the decentralized future. I agree that
Blockchain is only a small part of the future.

Blockchains with one writer are, for example Scuttlebutt. Super resilient.

I also agree that there is no viable medium of exchange that’s fast and cheap
for everyday transactions because the way blockchains currently work, they
need a global consensus about every friggin transaction. That doesn’t scale.
That’s why we launched intercoin.org

If you want to see more about this topic, I just wrote about it:
[https://qbix.com/blog](https://qbix.com/blog)

~~~
nmeofthestate
>This guy doesn’t live in a country where the institutions people rely on have
routinely screwed people.

True, but his argument is that the actual fix (that would work) is to fix such
dysfunctional countries so they are functional, rather than downgrading
everywhere to a Somalia level of trust with blockchain as the techno solution.

~~~
EGreg
And I am saying that is NOT the optimal solution.

In the past we didn’t have many technologies, and we used centralized
providers who did things manually. Was that better? You can throw more
democracy at a problem. But technology to decentralize it is often better for
everybody.

I see technology as enabling UPGRADING, not downgrading. The proof is in the
pudding: will people choose it over the existing systems.

------
45h34jh53k4j
No coiners. Its fine, we will listen to them protest for years and years,
telling us it cant work, it isn't a real solution, etc, while we invent the
future.

This internet thing will never take off, you need a box that screeches,
connected to your phone all day long! I can't even get faxes while im
'online'. Pointless.

~~~
nathanaldensr
Your attempt to equivocate the internet (and its impact) and blockchain is
laughable.

~~~
chrisco255
I wouldn't say it's equivalent, after all, blockchain is a layer on the
internet. But it is common for people to underestimate the impact of
technology in the long term. Just as the dot com bubble left people
disillusioned with the internet as a platform for commerce, so too is the
current state of blockchain. It will continue to evolve, it will continue to
grow, and something will rise up and change commerce in a dramatic way. I'd
argue that the industry has already come a long, long way and it still has a
long, long way to go.

