
Rhetoric around the blockchain hints at problems with techno-utopian ideologies - walterbell
https://longreads.com/2018/02/15/blockchain-just-isnt-as-radical-as-you-want-it-to-be/
======
mi100hael
The biggest issue I see right now is with organizations trying to jump on the
blockchain bandwagon but controlling all nodes. If control of your blockchain
is centralized, it's no better than an ordinary database. The benefits come
when control is decentralized because you can still trust the data hasn't been
tampered with.

~~~
wpietri
I keep talking to people who don't seem to understand this, and I am having a
hard time giving polite responses. It's not only no better than an ordinary
database, it's worse in a number of ways, including not being boring enough.
[1]

Even if one needs trust that there's lack of tampering, publishing a real-time
transaction log is in many cases sufficient, just as long as you're willing to
trust that the central point is ordering transactions fairly. Which is fine in
the case where there's a legal relationship between the entities involved.

[1] [http://mcfunley.com/choose-boring-technology](http://mcfunley.com/choose-
boring-technology)

~~~
im3w1l
Your proposed system would not be censorship resistant: The central control
point could decide (or be forced to) to block MrControversialGuy's from
sending and receiving money. This point is not just theorethical, e.g.
wikileaks got booted of the normal bank system when they dropped their big
leaks, but they could still take bitcoin.

~~~
mseebach
The same is true for a blockchain where the same organisation controls all the
nodes, which is the scenario at hand.

~~~
polyomino
If they know which addresses belong to Wikileaks

~~~
mseebach
That's a feature of anonymity, not the blockchain.

------
thisisit
One of the bigger problems with blockchain is that there aren't many field
experts working in the space. For example if you look at a voting blockchain
you will be hard pressed to find an experienced psephologist working with the
team.

Without experience most of the team is made of people who might have read up
on the topic and thought - "Well! This can be changed via blockchain". What
they don't realize is academic exhortations are vastly different from
practical implementations.

For example, if everyone could implement that amazing trading system from that
trading book, everyone would be millionaire. But that is never true. Another
good example of this is the mistaken understanding of banking and especially
Visa:

[https://www.forbes.com/sites/francescoppola/2018/04/21/bitco...](https://www.forbes.com/sites/francescoppola/2018/04/21/bitcoin-
banks-and-a-whole-lot-of-fud/#2b2335bd21f1)

What this means blockchain solutions either run into issues during build or
work in a very specific circumstances.

For example, the building block of most cryptocurrency is game theory - if
someone takes over 51% then rational economical thing to do is continue the
chain. But what if we have an irrational actor who doesn't care? Or what if
people can manipulate the change even below 51%. A good example is the
F2Pool's manipulation of Status ICO with 25% hash rate:

[https://themerkle.com/f2pool-allegedly-prevented-users-
from-...](https://themerkle.com/f2pool-allegedly-prevented-users-from-
investing-in-status-ico/)

~~~
asasidh
\- getting to 51% is no easy task. \- if an irrational actor can get to 51%
and decide to wreck havoc, the current transactions are impacted. The
community will come together to hardfork away. The last transactions preserved
in the blockchain are not. \- if the above happens, then the particular
blockchain does not deserve the position it holds and deserves to go down. It
is no longer censorship resistant.

------
apo
_Bitcoin caused excitement when it proposed a technical solution to a problem
that previously required a trusted intermediary—money, or, more specifically,
the problem of guaranteeing and controlling money supply and monitoring the
repartition of funds on a global scale. It did this by developing a
distributed database that is cryptographically verified by an entire network
of peers and by linking the production of new money with the individual
incentive to maintain this public repository._

The problem was much more narrow than this: double spending prevention by an
incentivized network of peers.

The basics of cryptographically secure electronic cash had been worked out
long before Bitcoin came along in 2008.

What was new was the idea of replacing the mint (a trusted entity through
which all transactions must flow) with an open P2P network secured by monetary
incentives and probabilistic settlement.

With no controlling entity at the center of the system, no valid transaction
can be censored. This is the new force that Bitcoin unleashed on the world:
censorship-resistant electronic commerce.

The fact that Bitcoin's main value proposition is censorship resistance leads
many in the affluent minority to miss the point of Bitcoin entirely. They
don't have a money censorship problem (at least none they care to face), and
they view everyone who does as morally inferior.

~~~
facetube
A "money censorship problem" is the funniest unintentional euphemism for money
laundering I've seen in a while, congrats.

~~~
EGreg
Tell that to the people of Cyprus

~~~
pjc50
The reason why Cyprus got a "bailin" rather than a bailout (liquidity
extension from central bank) is precisely because the place has a reputation
for money laundering, e.g.
[https://euobserver.com/justice/139688](https://euobserver.com/justice/139688)

~~~
EGreg
So when banks freeze funds eg in Argetina or Venezuela this is because of
money laundering prevention, never any other factors like um I dunno, money
supply issues? :)

~~~
pjc50
Cyprus, like all the Eurozone countries, traded away the currency right of
issuance to the ECB in return for the stability of the Euro, in much the same
way as some countries "dollarised" to get away from exchange rate
fluctuations.

The Argentine and Venezuelan situations had a different cause: the economies
had tried to peg to the dollar, but that requires capital controls in crisis
situations to avoid capital flight.

In each case the fundamental problem is that a country can't print other
countries' money; either they have to accept (a) the possibility of a bank run
or (b) the possibility of a floating currency dramatically changing in
purchasing power.

Bitcoin solves (a), IF AND ONLY IF people hold their own bitcoins rather than
using exchanges. Bitcoin and gold advocates tend to avoid talking about
problem (b) or pretend a rapid shift in purchasing power can't happen in the
presence of a fixed money supply, which is contradicted by history.

------
badestrand
Well, the blockchain hype is easy to criticize. Tech people refer to its
inefficiencies and how it is just a decentralized database. Political people
point out that the real world is much more complex than what a blockchain can
represent.

I would argue that its strength lies in another area: It gets people excited.
It makes people start thousands of new projects and companies, millions read
all the news articles and a huge crowd invests a lot of money into the space.

And, of course, it gets people excited because it hits a nerve. It promises a
change of power structure in the world. Away from monolithic, opaque,
political structures to democratic, transparent, border-less systems. Changing
the role of _everyone_ from a helpless observer to an actice participant.

Obviously the build-up is messy and over-promising but it may very well change
the core infrastructures of how the whole world currently operates -
economically, politically and socially.

~~~
IkmoIkmo
The ratio of people who's nerves are hit because crypto can change the power
structure, to those who're interested in it because it has the potential to
turn a young person's $10k creditcard borrowings into $1m, is probably pretty
close to 1:100.

I mean, name the 10 biggest use cases. Bitcoin is 10 years old, it is a
household name, it's been in every newspaper, every developer in the world has
heard of it, it captured orders of magnitude more angel and venture investment
than say a google or facebook did. It should have some genuine users who are
using it not because it's a volatile asset class with an average annual return
of >10x.

It's virtually impossible to find any usergroup of significance anymore.
Outside of course the asset class, which so far hasn't changed the power
structure so much as it has made a few techies and rich people (paper) rich.

------
amorphid
> Instead, local publicans stepped in and extended credit to their customers;
> the debtors were well-known to the publicans, who were in a good position to
> make an assessment on their credit worthiness.

I didn't know what a publican was, so I googled it...

 _pub·li·can

noun.

1\. (British) a person who owns or manages a pub.

2.(in ancient Roman and biblical times) a collector of taxes._

I assume the author is referring the first definition.

~~~
robk
Still widely used today (the former definition)

------
arisAlexis
I have a problem with biased titles such as "X isn't as you want it to be" or
"No, X is not Y". This makes the whole article biased and me more biased about
reading it. Any valid points inside are clearly from the perspective of the
writer having formed a very concrete opinion over the subject and trying to
convince you. The title is like "either you are with us or against us" and
trying to either make me relate to the people that are disillusioned (so
offending me) or unite me against "them".

------
finebalance
Never understood how as a customer I can 'trust' a niche blockchain deployment
considering that a majority of the computing power in that network would
likely lie within the organization deploying the niche blockchain in the first
place.

------
zerostar07
> Fostering and scaling cooperation is really difficult.

It all depends on incentive. BitTorrent was so popular that it had to be
outlawed and heavily persecuted

> It doesn’t stand in for all the slow and messy bureaucracy and debate and
> human processes that go into building cooperation, and it never will.

Blockchains didn't want to go there anyway. But they replace the implied trust
in statespersons that lies behind any bureaucracy with machines. thats quite
radical, even if you layer a huge trust-based bureaucracy on top of that.

> there is no linear-causal relationship between decentralization in technical
> systems and egalitarian or equitable practices socially

There is a causal relationship between centralization of the internet and
monopolies/inequality and everything that people hate

------
thedancollins
Great article derailed by the final paragraph. So, the author is disappointed
that we want to ignore differences rather than focus on them. Inefficient and
unnecessary. I find the author's point about blockchain trying to replace
politics with economics to be something worthy of more study and thought.

------
aidaman
Crypto will end up being used as a tool for governments to control monetary
flow. Congratulations.

~~~
sidko
Can you explain how you see that happening?

~~~
miscreanity
Each consensus method (Proof-of-Work, Proof-of-Stake, Directed-Acyclic-Graph,
etc) has weaknesses that can be exploited by a large or influential enough
entity - there are _no exceptions_. All it takes is time.

By the time the system has reached mass adoption, we will probably come to
find that there is a central entity with majority influence over it but the
utility and infrastructure integration will have such momentum that changing
will be effectively impossible. Fringe communities may be able to operate
relatively independently, but the core will be subject to the most dystopian
control and tracking system ever devised - Huxley and Orwell could not have
imagined worse.

That isn't to say that life won't be improved in general - there will be major
positives. However, an undercurrent of entrapment will pervade even if it
isn't at the forefront of attention.

~~~
AlexCoventry
It seems likely that Proof-of-Stake can require an economic commitment which
will be extremely hard to expropriate, and can at least start out with a
fairly diverse group of validators. If the chain is valuable enough, it's
going to be expensive to buy up enough to pervert its consensus, and doing so
will result in the stake being slashed.

On the other hand, a currency which people are forced to use by law (legal
tender for tax payments) will always have a huge advantage. So if governments
decide to move to most transactions in the national currency taking place via
cryptographically signed attestations involving government-provided keys, that
will be a major move towards the kind of dystopia you're imagining.

~~~
miscreanity
Proof-of-Stake units don't have to be acquired via public exchange, so
ownership can concentrate without visibility; same as any other crypto system.
It would likely work well enough for a period of time but as the system starts
to show it's age, lots of unpleasantness follows.

I fully expect governments will embrace and utilize crypto to terrifying
effect. Maybe it's time for Mars colonization?

------
EGreg
_“There’s zero evidence that features such as decentralization or
structurelessness pose any kind of threat to capitalism.”_

Disagree.

Desktop publishing disrupted the idea of Copyright as Intellectual Property.
The Internet obliterated it.

Open Source is a superior alternative to Capitalism. People cooperate on a
project instead of capitalist organizations competing and trying to extract
rents. In both cases, quality goes up but in the open source case, costs stay
near zero the whole time. Once again this became possible because of
information dissemination.

When Newton said he stood on the shoulders of giants, those giants didn’t
charge rent!

Next will be open source drugs.

I would like to see a new system emerge. One where people GIVE AWAY their
inventions because if they don’t, someone else will beat them to it, and
control for a time the direction.

In this world, people are more free and Basic Income lets them choose what to
do with their lives. Robots do more and more work while people contribute here
and there to a growing snowball.

It is the world of OpenAI, Wikipedia, WikiNews and citizens uploading videos
etc. and not this lamenting about how the newspaper industry will make money.

The alternatives to Capitalism aren’t “socialism” only. They are
Collaboration. Science! Open source!

A society may be “free” by anarcho capitalist standards but each individual
person may fear losing their paycheck. This is not sustainable in the face of
technological unemployment.

What kind of freedom is it that you are coerced by the system into committing
to working on things you don’t like in a constant state of food insecurity and
pne month away from homelessness? This is the situation for millions of
people.

It doesn’t have to be like that. We have enough resources to feed and house
everyone ten times over.

~~~
rimliu

      > Desktop publishing disrupted the idea of Copyright as
      > Intellectual Property. The Internet obliterated it.
    

Must be some parallel universe. Or I totally misunderstood you. Are you
talking about torrents? The bad news is: basic income will not cover costs of
producing GoT or Breaking Bad.

    
    
      > Open Source is a superior alternative to Capitalism.
    

What does this even mean?

    
    
      > People cooperate on a project instead of capitalist organizations competing and trying to extract
      > rents.
    

As already pointed out, in many (most?) cases these projects are sponsored by
capitalist organizations.

    
    
      > In both cases, quality goes up but in the open source case, costs stay near zero the whole time.
    

It would be nice if that were true.

~~~
saalweachter
I mean, strictly speaking the same group of people producing GoT now could
continue to do it voluntarily while living off basic income, but you have to
include the suppliers as well as the people directly working on the show in
that equation.

Once your consider the full chain, you're probably looking at something like
2000+ people working full time to make Game of Thrones. How do you organize
and incentivize them when there is no material reward for their labor? Right
now the incentive is "we'll give you money" and the system of governance is
"the person who gives you money tells you want to do". That second part is as
much the problem as the first; if you had 2000 people making GoT as a labor of
love, what happens when there is a schism over how it should be adapted?

~~~
EGreg
I see it moving more in the direction of collaboration.

For example, Britannica was done in the way you say, while Wikipedia is a
mashup of many edits by many people, and governance is done less by money and
more by expertise and consensus of people with reputation.

Who says Game of Thrones needs to be done this way? We can always have
capitalist projects. However, they have a totally different flavor. They suck
you in, make you watch more and more, just like fb so you can make them money.
Who needs these things, anyway? I for example didn’t have TV since grad
school. Sure the high budget shows are cool but they aren’t essential to life.

I would even say Copyright can stat but Patents should go. Finding a life
saving drug is way more major than producing a blockbuster movie.

Not to mention that a lot of stuff can now be automated, eg music production
doesn’t require a 100 person orchestra anymore since you have synthesizers.

In fact, as costs come down we will have a glut of movies people produce in
their bedroom. Just notice, there are no longer the “world class” mozarts and
einsteins of the world. Now everything is more democratized.

~~~
saalweachter
> In fact, as costs come down we will have a glut of movies people produce in
> their bedroom.

Phrasing?

------
zitterbewegung
Also, this article's title isn't as radical as they want it to be because they
are conflating distributed ledger technologies with blockchain.

~~~
alexkavon
What is the difference? Isn't a blockchain a specifically branded crypto-
currency flavor of distributed ledger?

~~~
lovemenot
Not every crypto-currency flavor of distributed ledger is a blockchain. See
Distributed Acyclic Graph as used by iota, for instance.

------
tomglynch
A lot has happened in the space since August 2017 when this article was
written. Having said that, it's still quite relevant.

------
grosjona
The markets that cryptocurrencies are potentially going to replace include
NASDAQ, NYSE, LSE, TSE and all the other national centralized stock exchanges.

Cryptocurrencies are a superior way to represent stocks, especially software
company stocks where the service can be tightly coupled to the currency
itself.

There are multiple reasons why cryptocurrencies are better at representing
company ownership shares:

\- There is no need to trust a middleman or government to maintain your
holdings. There is no room for bad actors.

\- Transparency regarding who owns what (assuming that the ledger is public).

\- It can never go bankrupt unless all users of the network abandon it - But
they all have a strong financial incentive to keep it running.

\- It doesn't need government regulation to function properly; in fact, it
transcends government boundaries. Loose government regulation makes it
extremely liquid. Imagine if you could buy your lunch using company stocks
directly instead of cash.

~~~
pjc50
I find it hard to see why people would go for a system where the transaction
times are comparatively huge - you can't HFT on the blockchain, for example.
And it's revealing that the cryptocurrency infrastructure has basically
replicated the exchange system, complete with central counterparties and
broker-dealers.

> Imagine if you could buy your lunch using company stocks directly instead of
> cash.

This sounds like an excellent way to complicate your tax return.

