* Distributed consensus schemes are not useful only for monetary applications. When they are used as such, there exist mechanisms to commit to a certain fiat price and minimize market exposure to the point where transactions are almost free, in fiat terms.
* The disbursement of tokens and the distributed consensus rewards do not need to be tied together like in Bitcoin. A premined token like Stellar can offer very strong security guarantees without needing mining pools (but of course, any kind of imaginable database is vulnerable to majority attacks, so that means nothing by itself)
* The limited block capacity is a Bitcoin-specific problem that incidentally motivated interesting results in off-chain transactions (Lightning).
* The sorry state of the distributed financial markets says nothing about the technology and more about human greed and the slow capacity of regulators to adapt; critically, smart contracts and distributed algorithms enable control mechanism and hard guarantees that have no old world equivalent, they can eliminate counterparty risks, guarantee solvency and fair arbitration etc.
That being said, 95% of the times the word "blockcahin" is uttered these days, what follows is most likely bullshit.
The required nexus between the blockchain and the tangible and legal worlds means every limitation that exists today will exist for a "smart contract". It's the same plumbing with a paint job.
Right now, we have the government operating as both the "miners" and the auditors.
A middle-ground, then, might be one in which there is a general-purpose public blockchain where the government takes the role of the trusted third-party on-chain, thereby lowering the overall societal costs of things like unfulfilled contracts while still ensuring that my oil-reserves are what I say they are.
From the government's perspective I see this as desirable but falling prey to the principal-agent problem. We'd need virtually no civil-court judges or attorneys to prosecute white-collar crime anymore. It'd lower costs, but in doing so unemploy many of the people in the system.
But the rest of your post is pretty silly. How does a secure digital exchange protect against fraud? It doesn't.
It's that plus a whole new crop of perverse incentives which arise with any "smart contract". Especially, no smart control can reach out to the "real world" and get data, more less facts. A smart control would essentially be limited to some data-stream in on Internet. And anything like that can be subverted seven ways from Sunday. Do you really want billions riding on THAT?
(and, yes, give us some Rube Goldberg scheme of averaging six different weather stations for your result. I'm sure nothing can go wrong with any of those ideas. Yeah, World finance then gets to be hoisted on the lpad petard).
When the great recession started, it was not caused by an external shock, rather by the viral mistrust that the underwriters of the bad loans were solvent. A financial fragility problem that the blockchain can work to address.
I also don't think this is a false dichotomy. Most likely we'll end up at a place with some improvement over what we have today (I'd actually argue we're currently at this point now) but not without all of the limitations.
This is true -- it's also true the 5% is pretty damn interesting.
There are plenty of interesting tokens out there. Some of them are tackling real problems. That's pretty exciting. I don't begrudge someone who's trying to solve something.
The historical analogs are lazy in my view. The financial and political system we operate in today has done plenty of damage. Indeed, some of the key examples listed on the slide.
The last global financial crisis wasn't that long ago (and wasn't that "reversible", certain people may recall). You could spin every one of those dot-points as commentary on our existing financial systems.
Doesn't mean blockchain is going to fix it. In fact, I have many doubts and concerns. There is so much to do. However, I really like that people are trying.
Even with that remark -- I wasn't thinking particularly politically. There are plenty of markets I think blockchain has a decent swing at.
Blockchain does not appear to be the best way to build a decentralized system for user controlled data (such as a decentralized social network).
We already figured that system out: local software, local storage, open source, local permissions & controls. Billions of people have personal computing devices now. No blockchain is needed at all, that just adds entirely unnecessary bloat.
You shift the point of control back to the local device and away from the network. It is that simple, and it's how we largely used to control user data.
I agree. Blockchain only makes sense for things that require immutability which many applications do not. OpenBazaar is a good example of one of the applications I was thinking of.
* Website gives person a unique code to broadcast on the blockchain to prove they have control over that identity
* 'Approved' services claim things publically about identities (eg age, allowed to drive) which others can use to verify claims
What I don't get is:
* how you know which 'approved' services to trust in the first place
* why you'd want all of that information public
* how it'd fix the original issue
The other issue is that none of this is necessary. If I want to prove to Person X that Gov Y says that I have property Z, why can't I just present a cryptographically signed certificate saying I have property X. You could even have a similar revocation list as CA.
You don't think if the problem were that easy to solve, it would be solved already? Throwing blockchain in the mix gets Facebook nothing that it couldn't get today by just partnering with organizations can verify identities.
Not to mention, the "fake news" issue isn't largely an identity issue — there are plenty of people and organizations willing to lie on their real accounts to further their sociopolitical agenda, and plenty more people who don't care if something's true so long as it confirms their existing viewpoints.
All this money is invested in "get-rich-quick" hopes. Few would care, or invest anything, if it was just for the decentralization aspect (case in point, all the failed aspects of decentralized social networks and other such efforts).
I agree that human greed and corruption is a big problem. It is a problem for any system out there.
But, blockchain was supposed to solve this by introducing trustless and decentralized applications. If there is now a need for regulators, how is blockchain supposed to solve other problems? The world is already complex, we don't need another layer.
People that use the word "fiat" are also entirely ignorable.
OK, but blockchain is not a distributed consensus protocol. It's a document
I'm also super curious why you think blockchain systems don't have actors that work independently of each other? I was always under the impression that was the entire point.
Sort of. However, a Perforce server with local replicas is not the same thing as a fully offline git transaction, for example.
>I'm also super curious why you think blockchain systems don't have actors that work independently of each other?
They work as part of the network but two users can't make a transaction without having to involve the network.
Except for private blockchains, which are totally brain-dead.
And mining is actually less akin to solving math problems and more akin to, well, actually mining. That is, digging around enough until you find some gold.
The primary difference is that banks are encouraged to cooperate to recover these. In the blockchain world, it's incredibly difficult to recover losses and people suggest "no-takesies-backsies" is an ethical method of doing business while wracked by fraud.
The main difference is that it is infeasible to hold large amounts of cash, and so we usually allow a third party to hold on to our money. That third party will usually hand over your money if requested by the government (some overseas banks are notable exceptions!!). With bitcoin I can hold on to it myself and not have to worry about the actions of a third party. Secondly, even if you horde cash, it's hard to secure it. It's basically impossible to make it so that only you can access it. With Bitcoin, it is easy to secure a large amount of value and ensure that only you can access it. Bizarrely, a large number of people totally ignore this advantage...
This is the entire point of bitcoin. With the hype, fraud and what not, people often assume that bitcoin must have been developed as a scam. But I really do believe that the purpose was to allow people to have access to money and not have to rely on a third party who probably doesn't have your best interests at heart. It's not really surprising that criminals will be interested in this kind of system. They are the ones with the highest need. The government can't freeze your account.
The interesting question is: do we need that kind of security? Do we trust the banks and government to act appropriately with our money?
A bit harder to do that when someone deprives me of bitcoin by theft or fraud.
I am familiar with compensating transactions. Ledgers are a necessary mechanism, but they are not a sufficient mechanism to safeguard against theft, fraud and error. These systems work because of multiple overlapping defences and they still fail.
I find that I tense up at the strong strain of technoutopianism that runs through bitcoin and cryptocurrency circles.
You're asking the rest of us to bet everything on block. I don't trust anyone to not make a mistake and I don't believe in single lines of defence, no matter how computationally intractable they are on paper.
This is one of those cases where the theory and practice don't match. The are two cases: the destination account exists or doesn't. If it doesn't, your bank returns your money minus some handling fees. Your Bitcoin in the same situation is gone to an unused wallet which nobody can access.
If the account is valid: With Bitcoin it's on you to track down who owns your funds now and figure out how to recover it. In case of a bank though you raise an issue with them and start the process - either internal or across banks. It allows the person receiving the money to approve a quick reveal, or allows you to start legal action to recover your funds.
At some high, abstract level, these are similar. But in practice, banks make it pretty easy to recover your funds in case of simple mistakes.
We had examples of a number of entities, which tried to apply the best practices and were aware of the risks, completely failing at the task. Multiple exchanges, smart contract operators, and other companies failed to protect their coins. The real world shows us that this is not that easy given clever adversaries.
Mind you, Ethereum apparently was too. :P
There is also the matter of verifying the platform itself.
The Ethereum virtual machine has been formally verified.
"These properties make KEVM an ideal formal reference implementation against which other implementations can be evaluated. We proceed to argue for a semantics-first formal verification approach for EVM contracts, and demonstrate its practicality by using KEVM to verify practically important properties over the arithmetic operation of an example smart contract and the correct operation of a token transfer function in a second contract."
From the paper, it seems that the latter example could have found a bug that caused problems in a deployed Ethereum contract.
In that case there is no redress as the platform is for all intents and purposes immutable when it's working correctly.
In other words, errors that occur due to malfunctions in the platform are reversible. Errors in applications built on top of it are not.
I think the bottom line is that contract law is an AI-hard problem-- meaning it takes a "real intelligence" to negotiate and enforce contracts. Simple logical rule sets implemented in code are too dumb.
Is it easy to exploit smart contracts? Is it fundamentally impossible to make them secure? Maybe we lack the proper tools, maybe current architectures need to be improved.
When we come to blockchain world, we run into a dilemma:
1. Hard-forking means it's no longer truly "immutable"
2. Not Hard-forking means we're fucked.
The first point is important even if you're not an immutability nerd, and most people don't realize the significance of a truly ownerless ledger because most people haven't thought really deep into how the society and economy works.
In my opinion the difference between a truly ownerless ledger and another one that has made 0.1% tradeoff is as different as the difference between selling something for 1 cent and giving it away for free.
I think blockchains like Ethereum that want to become general purpose will have tendency to move towards being more centralized. Not saying that's bad, it's a tradeoff, but nobody knows what the end result would be. It could end up becoming like the Web, where the protocol itself is supposed to be decentralized but every user facing stuff is completely centralized.
Specifically, on governance of blockchains (as in: trustless distributed consensus systems, and not as in: merkle chains), I do tend to agree with the tweets that devs have a huge amount of pull, and that this is both grossly under-estimated and under-discussed.
Correct me if I'm wrong - I'm not an expert in blockchain by any means.
If you want to talk about something useful you were probably calling it something like a signed/verifiable log.
And I didn't realise the secrets I gave to my notary were out in the open. Hint: they're not, and that's legally enforceable. The blockchain is nothing because data is [legally]  nothing. You might as well just use public key cryptography and release your data over BitTorrent, like Wikileaks did. It'll get distributed based on supply & demand, and using BitTorrent is still cheaper & efficient than blockchain.
 At least, in the EU.
Turing completeness was sort of assumed with "Global computer". Neither myself nor the poster mentioned Ethereum at all. He just mentioned "global computer" as one application of blockchain that isn't a cryptocurrency. I could have just as easily been talking about NEO, which uses a number of languages, including C# and Java. Further, while Ethereum does frequently use a new language (Solidity), it doesn't rely on it. Ethereum is a virtual machine, and the first implementation of the virtual machine was Solidity. Others have been made as well, its turing complete after all.
Well, yes, but most of them (my pet peeve being voting) are as bullshit as
cryptocurrency. Do you have an example that is not a bullshit?
> What is a good spec for blockchain?
Finally people are seeing that a blockchain without POW or censorship resistance is bullshit.
This is why bitcoin (cash) is more important than ever.
I couldn't pay someone in South Africa rural area for something worth $2 without bitcoin.
Many other people are censored.
Billions more have their wealth devalued via inflation.
Bitcoin is a way for people to be free without any state taking their money (see Greece)
Call me a skeptic.
Neither of those statements has ever been true and in recent years they've been ludicrously untrue — affluent people in developed countries were complaining about the transaction costs and they're supposed to be transformative for people in a developing country?
There will likely be a trade-off or balance of trust against transaction speed and cost. We're still working out how to build it and so we're not there yet, but my belief holds; the banana governments are not going to disappear anytime soon.
Those existing systems are also useful for evaluating the claims that this avoids bad governments, which is to say that it’s limited to bypassing antiquated banks. A networked system can’t avoid a sovereign state unless that state is completely inept, at which point everyone will be using a neighboring currency or USD anyway.
You can buy a cheap refurbished Android phone for $5.
And you have SMS cointext.io to transact for instance.
You do not need a hardware wallet, only to memorize the 12 word seed phrase.
Just look at the set of users who have phones without adequate banking. You will see this is measured in the billions of people.
The best hope to lift people out of poverty is for us to transact and deal with these people.
Maybe that's great for your pocketbook. To me it seems pointless and worthy of scorn.
Yeah wow, we're all impressed.
If you end up scaling off-chain, then one asks why you have the PoW chain and it's phenomenal cost at all.
Different people answer differently, but many would give censorship-resistant currency as a use case. My personal answer is more complicated.
> If you end up scaling off-chain, then one asks why you have the PoW chain
Let me generalise slightly to include PoS, which I greatly prefer but which is also pretty expensive, and suffers from the same fundamental inefficiency problems. Obviously, you need on chain consensus and guarantees so that the payoff matrix for the offchain game is setup correctly so that honest behaviour in the offchain game is a Nash equilibrium. So that when I "pay" you some money in a payment channel you really have received it in a certain sense, and offchain payments are basically as secure as on chain ones.
Nothing about blockchains prevents censorship.
> Let me generalise slightly to include PoS, which I greatly prefer but which is also pretty expensive, and suffers from the same fundamental inefficiency problems.
Most literature I've read suggests potentially a hundredfold increase in throughput with Proof of Stake when executed correctly.
The only fundamental inefficiency problem PoS shares, by my reading, is the broadcast mode limitation where every node needs the full chain to be broadcast before it can move forward. However, PoW systems are nowhere near that rate limit.
I'm certainly happy to be shown this is wrong. Got resources?
> Obviously, you need on chain consensus and guarantees so that the payoff matrix for the offchain game is setup correctly so that honest behaviour in the offchain game is a Nash equilibrium.
You're right, the offchain game needs to be set up so that honest behavior is the optimal behavior. But this is where the cart is firmly planted in front of the horse. What you need is not a blockchain, what you need is trust that controls are in place to resolve a dispute equitably. The blockchain is a methodology not for eschewing trust, but contracting it out in a novel way. A blockchain, folks with guns, an escrow service with a good API, international banking: they all serve the same purpose here.
We should use these tools when they serve us. But what I've seen is that for an actual daily-use currency all that's going to happen is a million little token vendors which can negotiate lightning channels to one another will show up and we'll just have new banks that are like the old banks, but with the threat of a chain resolution which may or may not occur. The practical outcome will be indistinguishable from a healthy banking system, won't actually stop fraud, will be subject to the exact same controls that other physically rooted banks are subject to, and also be a lot more confusing.
I think lightning is solid; in that it will work. I also think it reduces a play at fundamentally restructuring commerce into a flashy buzzword pitch to reshuffle the existing players on the board somewhat.
Having been deeply in the (somewhat broken) American banking system, I can tell you that the system desperately needs to be reworked from the ground up and that can only happen with a truly distributed, truly transparent (an often undersold or ignored aspect of Bitcoin but a truly phenomenal property), truly and fundamentally new way of performing commerce.
We don't have that.
The decentralization of block producers helps. For instance we saw a few years ago that a few payment processors could decide to not support wikileaks donations, meaning that the only non-cryptocurrency way to donate to them was to mail them cash in an envelope. A government seeking to do the analogous thing would need to effectively make the network soft-fork a rule in disallowing payments to wikileaks addresses, something much harder to do.
> I'm certainly happy to be shown this is wrong. Got resources?
I have never seen any legitimate public blockchain claim 100x improvement from PoS over PoW. I'd be surprised if it were more than 3x for ethereum.
One very powerful upper bound in any non-sharded blockchain without validator delegation is that every full validator must process all transactions, and we want validators to be able to do so with relatively weak hardware (e.g. a Macbook Pro). Certainly, a 100x increase in ethereum TPS would violate this upper bound; for instance, the current state size (2GB) is not designed to fit into RAM, and hence every transaction must do a random disk read and write onto a hard disk. The actual computation can be pretty expensive too, e.g. I've seen a benchmark that ECDSA verification takes 500ms on an i5 processor.
The "broadcast mode limitation" you mention imposes another upper bound, but I do not think it is sharper than then validation upper bound.
> The practical outcome will be indistinguishable from a healthy banking system, won't actually stop fraud, will be subject to the exact same controls that other physically rooted banks are subject to
So this is more subjective but I have to disagree here, depending on what you mean by "healthy banking system". We've learned from history that to have banks run on fractional reserve yet not be subject to frequent bank runs, we have to make them hold reserves in some central bank. And even if you just set up an "anti-escrow service" you have anti-fraud and AML laws to comply with. The end result is that there are huge capital requirements to create new banks most places in the world and fraud still occurs; the capital requirements lead to an oligopolistic industry that doesn't actually provide the consumer services it exists to provide very well. This seems pretty backwards to me. I think in the near-term, payment channel hubs will be much cheaper to stand up than banks and the trust model will be the same as on-chain payments: if you accidentally pay someone off-chain you have no recourse. It seems that building fraud protections on top of this base is more sensible.
But there was some music I paid for online because I liked the sound.
It's awesome that I'm able to support artists and creators across the globe and make a difference in someone's life (as they made a difference in mine).
Transaction cost? 1 cent with Bitcoin Cash. They kept $1.99
The only difference between it and a git history is that git histories are dags instead of trees — The hash-of-parent-node structure is the exact same, except commits can have multiple parents. The tamper resistance of the data structure itself comes from the hashes: it serves as both a pointer and a checksum for the previous nodes.
A) This isn't true. They also have predictable monetary policy and anonymity (or pseudonymity, in the case of Bitcoin). These can be useful properties, whether or not you agree with their uses.
B) Even if it were true, so what? Censorship-resistant money seems like a pretty cool technology to me.
> Any volatile cryptocurrency transaction requires two currency conversion steps.
Sure, in the absence of merchants accepting the currency that is true. But that's sort of like decrying the internet as useless when it came out because nothing was on it. And listen, if you want to go ahead and make a case that cryptocurrencies are structurally incapable of becoming commonly accepted - by all means, go for it. That is how you attack the concept. You don't attack a new technology by saying it isn't adopted yet:
"Cars can never work because there are no paved roads"
"Credit cards are stupid because nobody accepts them"
If you want to try to make some intrinsic, fundamental case that there is some structural barrier preventing the adoption of cryptocurrencies, that's a perfectly reasonable line of argument to make. Simply stating the obvious, that they are not yet widely accepted, is not.
> Any lottery-based reward creates mining pools, which means a few entities can and do control things.
While true in a certain sense, an analogy here might be useful: Capitalism is centralized, because people organize into corporations, which end up aggregating capital. This is an accurate description of capitalism. However, capitalism is still distinct from what's commonly known as 'top-down economic planning', e.g. communism. The fundamental difference is that the process is organic, and for the most part, empirically, the organic version of this process leads to better outcomes.
Again, perfectly fine to argue that this particular one doesn't lead to good outcomes for such and such reasons. However, to argue that it is centralized, is kind of missing the point. Yes, powerful entities do form, but their power is not guaranteed. Their power is highly contingent upon their continued performance of their duties, and the collective desire to let them keep their place. This powerfully aligns their incentives with the well-being of the ecosystem.
Now, does this mean that that alignment is perfect? Definitely not. Just like in a capitalist economy, those incentives can and do deviate from each other. However, these things do not exist in a vacuum. All tradeoffs must be considered as alternatives to competing mechanisms. And I think the tradeoff made here by crypto-currencies is a good one, relative to alternative options.
> Limit capacity fee death spirals
This whole slide just ignores the existence of payment channels. The author is sufficiently educated to know he's being disingenuous here, so there's no need to respond to it beyond that.
In summary, and I want to be totally clear on this: There are great reasons to be skeptical of crypto-currencies. There are lots of things they don't do well, and there are lots of very serious tradeoffs that they make that are different than the ones we make with government-backed fiat currencies. They pose real risks to certain pillars of civilization and it's not clear that they are on balance good things. But our criticisms of them should be couched in an understanding of those risks and tradeoffs. They offer real benefits in some dimensions, and they have real costs in others.
If someone is telling you that a politically neutral, censorship-resistant world currency is, a priori, useless, you may want to re-evaluate the source. We may or may not like what something like Bitcoin will do to the world - but the idea that it doesn't have the potential to do anything is really quite silly.
Like ensuring Bitcoin can't scale beyond the Great Firewall's limits?
To me, this is a pretty awesome way of discovering the best way to do things. If two parties can't come to agreement, they simply go their separate ways, and organically the system comes to decide which chain is more valuable. I find this to be one of the most beautiful, elegant parts of the crypto ecosystem.
Consider the contrast to a government currency. If you disagree with how the Chinese Communist Party manages the Renminbi, or how the Federal Reserve manages the US dollar, you don't meaningfully have the option to create your own alternative, and let it be judged by the world. This is the truest sense in which crypto is decentralized.
Now, this model is not without its flaws. National currencies have done very well for a long time being managed in this way. The ability to homogenize everyone on a single national currency has real benefits. It's easy to build up lots of infrastructure around it because it's dependable, for instance. Thinking through issues like this are really what's at the root of a well thought out criticism of crypto-currencies, though, IMO.
But I did think the same thing about Twitter, especially early on when it was constantly broken. And yet, while it was broken people were still talking about it and it was gaining mommentum.
That's the parallel I see here. Enough of the right people are talking about it that it's going to be a thing for at least the near-term future. The whole eco-system can be flawed, but it has momentum.
And even among those that have been scammed, it's in their best interest to keep pushing the virtues of cryptocurrency as long as they have any left to sell.
I don’t see a parallel there for cryotocurencies. It’s just a bubble and I don’t see any Arab Spring type of event to legitimize it.
Would be nice to have a fifth slide explaining friction cost and why it might be a very bad idea to embed ever increasing friction as your formal verification method.
Signal is great but iMessage?
Nicholas Weaver covered iMessage's strengths and weaknesses before:
(20150804) iPhones, the FBI, and Going Dark 
(20150806) Nicholas Weaver on iPhone Security 
(20150908) Apple's iMessage defense against spying has one flaw 
(20171211) Is Apple Fully Complying With iMessage and FaceTime-Related Court Orders? 
I also remember a technical analysis on iMessage by either Matthew Green or Nicholas Weaver.
Also, this guy didn't even discuss blockchain tech. Just cryptocurrency.
Say what you will about their ethics, their structure, their politics, that company did this thing and they're now more important to the world of software products than any prior company in that role ever has been.
The good news is the statement you quoted was not made.
> I'd expect more depth and logical statements for a presentation at a university.
The slides contain logic statements, depth, and e.g. historical comparisons.
Since there's some character assassination in this thread (how sad): Nicholas Weaver's credentials can be found here .
They claim digital collectibles is a viable business.
> The (original) internet brought us a world where any site could link to any other site, and they could all be accessed from anywhere in the world. This was the first interoperability revolution. The next one will be with data and digital assets. For a long time, data has been the property of platforms — with cryptonetworks and cryptoassets, data can live outside of anyone platform, under the control of users. This has the potential to open up a lot of innovation. 
Matt Levine as usual had a bit of fun with this:
> Look: They are right, and I was wrong, and I am sorry. I thought that CryptoKitties was just a game that allows you to buy cartoon cats on the blockchain, and I thought it was silly. But I completely missed the point. CryptoKitties is actually a game that allows you to buy cartoon cats on the blockchain, and put little hats on them. 
Let me tell you a little story you might want to remember, so you can tell your grandchildren. This is how you might tell them:
"You think algorithms are hard, little children? You don't want to stay up to date? Well gather round, gather round, let gramps give you a sense of human folly and just how far we have come. Maybe that will let you appreciate how lucky you have it.
"Way back before all these modern doodads, gizmos, and doohickeys, back in aught 9, or "two thousand and nine" as we called it, mathematicians were so clueless about algorithms that they made distributed databases resistant to sybil attacks through proof of work doing random-ass hashes. What that meant is instead of figuring out how to prove nodes weren't colluding, we made them prove they were burning oil - or gas - or coal - or sunlight, or whatever they wanted. But they had to throw their hands up and come up with a random hash, to prove that they were really all working on the problem.
"By 2018, the resulting worldwide bitcoin database used 30.1 terrawatt-hours of power per year to perform the work that a $20 dedicated chip could do in the size of a container of tic-tacs. And that $20 includes 100 gb, a dedicated microcontroller, and 5 years worth of alkeline batteries. The database size borders on nil.
"All because we didn't know any better. That is something like $3,848,100,000 in 2018 money - three billion dollars spent on doing $20 worth of work.
"To put this into perspective, imagine that in 1802, Merriam Webster had purchased fifty thousand tumblers, into which it put printed plates, and then hired fifty thousand workers to open each one every few minutes, and count to see if it had managed to assemble the plates into alphabetical order. (This is called bogosort.)
"Well, if you don't know that there is such a thing as a sorting algorithm, if it's unknown to science, then perhaps bogosort is the best you can do. Such was the state of distributed blockchains in 2018.
"So you need to be thankful for what you have. Oh but it's tough! You have to think it through! Well in my day nobody thought it through. We just shoveled thirty terawatts of coal into furnaces and made little kids cry when they couldn't afford gaming equipment anymore, since all of it was being used to get around the fact that nobody sat down and did the math for a $20 distributed database.
"you kids have it printed in black and white. sit down and learn. we had to take electricity from schools and hospitals, to raise the sealevel to where parts of Hawaii had to be evacuated. This stuff has consequences. Learn your algorithms. Trillions of watts died for them."
This was my only issue with bitcoin when I evaluated it several years ago.
There is also a debate to use delegated PoS or a hybrid of PoS and PoW to get both of their upsides with none of tbeir downsides.
Read: PoS has downsides.
They receive a lot of press attention because people like me, who don't own any cryptocurrencies and never plan to, find them fascinating. When I'm in San Francisco or certain bars in my Manhattan neighborhood, people talk about owning them. When I'm at a restaurant in Phoenix or Salt Lake City or Raleigh, it's people observing the phenomenon just like I am.
> there's no proof that being burned by cryptocurrency shenanigans leads to greater wariness
Fair enough. My basis is the general wariness that followed the Great Depression. (Counterfactual: no such enduring effect followed the dot-com bust nor the financial crisis.)
This stuff could be the makings of /etc/passwd for the internet.
Somebody hasn't been keeping up with proof-of-stake research.
> spammers who want to occupy space forever!!!
Or Ethereum's storage rent proposals.
Wealthy people in these countries use offshore locations to secure their money from their own corrupt governments. With blockchain everybody can have such option and thus motivate governments to create better environments for ordinary people. And it is not surprising to see that democratic countries embrace cryptocurrencies and try to regulate them but more authoritarian regimes just ban cryptos.
1) Two conversion steps - since Intercoin is designed to be used as actual currency and not just a store of value, people can pay each other anytime with zero fees. Given enough adoption, people stop cashing out (think PayPal, Venmo etc.) and just pay each other in that economy. They do this to save fees and time.
2) Entity to convert currency: Actually this entity can be a simple market maker on an exchange. Within its economy, Intercoin has sidechains for each community and deterministic pricing, with no market makers. And you don’t have to worry about eg PayPal or Cyprus banks freezing your money.
3) A “private blockchain” requires far more than that if it is to be used for crypto-currency. The main guarantee is that there are no forks of the log, aka double-spends. Intercoin lets every community run their own distributed ledger, so you don’t need to search the whole world for double-spends. That makes it so efficient you can even do micropayments (Netflix, Basic Attention Token etc.)
4) Proof of Work/Stake/blah. Intercoin letting communities run their own ledger the way Wordpress lets them run a blog, it comes with its own set of challenges as small communities can have very few computers. It has to be secure like your end-to-end encrypted email when you get on someone’s wifi. So we can’t use the traditional stuff. https://intercoin.org/technology.pdf
5) Lottery-based systems create mining pools: yep and in fact any kind of proof of stake creates centralization, while any kind of proof of work creates an arms race that leads to centalization. Intercoin takes inspiration more from XRP consensus protocol and SAFE network design.
6) “Code developers can and do act like central authorities.” If this refers to issuing the Unique Node List like Ripple, or reverting transactions like ETH etc. then that’s not good. If this means putting out a new client of server software and having decentralized adoption then that’s inevitable. Otherwise you get fragmentation like Linux. And even then, there are only a few major Linux distributions. I happen to prefer collaboration on a centralized codebase in this case, but decentralization in everything else. (eg I would be totally OK with WebKit being overseen by the W3C consortium and have new ideas begin as extensions that are finally adopted into the main codebase - think of all the wasted web developer man hours since multiple browsers launched).
7) Protection limited to money wasted - not sure what that means. A person knows their money can’t be stolen. In Intercoin our priorities are A) the overall network must never be corrupted, B) no one can steal your money C) no one can freeze your money permanently, in that order.
8) Transactions vs Capacity. VERY good points here, and all global networks are susceptible to this, as are public facing websites (DDOS etc.) This is why Intercoin is designed to be like the original Internet, with each community able to run its own network and set its own policies. That allows a theoretically UNLIMITED number of transactions per second, not 7 or 1000. Usually each validator includes a free tier for the first X transactions per day, to known members of the network. Networks run their own computers and the consensus algorithm is much cheaper and doesn’t waste half the world’s electricity to work. The validators - being off the shelf computers run by random people — fund themselves through the currency. But they earn money for actually processing transactions, not a lottery.
9) Bad economics - yes this is rampant in cryptocurrency circles (eg people including Satoshi thought Bitcoin being deflationary “sound money” will make people want to spend it, when the opposite is true). Intercoin has among its advisors world-famous economists from diff schools like MMT (Walter Mosler) and Austrian School, Chicago school, precisely for this reason. We want to let communities issue their own currencies and implement UBI on a community level through entirely voluntary means. It brings together people on the left and right.
10) “All ICOs are securities being sold fraudulently” - Intercoin Inc. has raised money through exemptions with the SEC (Regulations D and S) and is now working on registering Intercoin tokens with the SEC as securities ahead of a public offering. Not everyone shirks the law. In fact, we consider tech to be only one of the services we provide for communities. The others are turnkey solutions for regulations (securities, money transmission) and taxes (501c3 for UBI donations, capital losses etc.) so communities can install their currencies as easily as Stripe Atlas lets you open a company.
I hope this addresses it point by point.
If nothing then disregard you.
Doesn't prevent them from their multi-billion worth.
Markets can stay irrational indefinitely.
People creating a deck intended to be READ, not SPOKEN.
I disagree with this claim. It depends on whether the token constitutes an investment contract. If the token has utility, was sold as a utility bearing token (rather than an investment opportunity), and if the project possesses an open codebase which token holders can theoretically modify, then I don't believe said token is an unregulated security.
Yet, the vast majority of tokens do in fact function as unregulated securities, which is why these waters are muddled.
No, you ICO a utility token because you hope it'll go superluminal by interacting with an ecosystem full of unregulated securities.
You are approaching the ICO as though there were some Boolean value as to whether they are "good" or "bad," and have returned "bad" for you. In reality, to throw them all in the "bad" bin is lazy and the opposite of due diligence.
Let me give you some examples of other motivations beyond fast cash that might power an ICO:
2. Community spirit
I will not attempt to encapsulate what these motivations mean to various actors, but I can tell you that it's not "just about money" for everyone.
However, I will fully concede that most ICOs are scams. Advertising networks are not being overly cautious by restricting adbuys on ICOs. And most people are not equipped to tell the difference between a scam project and a real one.
I'd love to learn more about your position. I seek the truth.
Slide 2 & 3: Yes, 1st generation blockchains are slow and have high fees. That's why Bitcoin has just implemented the Lightning Network and there are 3rd generation blockchains like Nano and IOTA that have zero fees and instant transactions. Duh.
Slide 4: False dichotomy. Yes, there are a couple of scams in the crypto sphere, even 5% of the top 100 are scams, e.g. Eos, Verge, Veritaseum. Is 5% 100%? No. Duh + Facepalm.
He says something about distributed trust and then puts 'THIS IS A LIE'. That's not evidence and it isn't an argument.
He states that developers act as a central authority, which as it relates to the rules of creating new units and where they go to, is not true, since those rules are already established for the given chain.
He says there is a fee auction death spiral, which also is demonstrably false. Even bitcoin, with it's ludicrous restriction of throughput by political means, hasn't actually gone through a death spiral from fees which rationally should have made anyone think very hard about its future.
He says almost every exchange is full of fraud. This is debatable, but does not actually have anything to do with crypto-currencies (which is what he is actually talking about instead of "blockchain").
The last slide is basically just venting about stupid things people have done and bought in to, but also has nothing to do with crypto-currencies not working.
It's amazing to me that people seem so certain of themselves while having such hollow arguments.
Pretty sure its demonstrably true seeing as BT has gotten so bad the marketing changed from currency to store of value.
Bitcoin's nonsense propaganda has nothing to do these assertions of inherent flaws with crypto-currencies.
I don't see how you have enough information to make that determination. It's a presentation deck. Those are just bullet points, not the arguments you would (presumably) hear in the full presentation.
Could you give one example of an argument made in the deck which has been "thoroughly debunked"?
Most of the things he says are actually false arguments that no one is trying to make or just completely irrelevant.