A few self-serving white men (there are hardly any women or minorities in the blockchain universe) pretending to be messiahs for the world’s impoverished, marginalised and unbanked masses claim to have created billions of dollars of wealth out of nothing.
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I do not agree with the entire statement, but the amount of "self-congratulatory" shit that goes in Blockchain conferences is mind boggling. I went Ethereum Devcon 3, and its not hyperbole when I say ONE entire day of 4 days of conference was about patting on the back.
At risk of tangenting the conversation, comments like that from the guardian continue to drive me nuts. I understand that an identity-driven narrative suits their politics. But to say the crypto community is started by "white men" really rolls up a ton of geographical and cultural diversity between even the founders of the top few coins: Bitcoin (unknown), Ethereum (Russian), Litecoin (Asian-American).
The comment in the article is itself tangential. It's just a pointless bit of racist vitriol against the dreaded White Man, and has nothing to do with any of the substantive criticism
While "The Guardian" published this, it did so as a signed commentary piece, by Nouriel Roubini (which further appears to have come via a syndication service, 'Project Syndicate').
Such pieces are not the publication's opinion any more than a "letter to the editor", and papers will publish many contradicting opinions this way.
So it's not really accurate to attribute quotes from this article to "The Guardian". Only a very few, typically unsigned (or signed 'the editors') commentaries in a publication are officially the outlet's house opinion – and these often contradict or reference-but-highly-qualify any differing signed opinions (like this Roubini piece) they've separately published.
Maybe they're hoping online readers will eventually become as smart as paper readers, for whom this distinction between "signed guest commentary" and "house opinion" was clear for hundreds of years?
Still doesn't make it accurate to attribute it to 'The Guardian'.
And still, even a publication with a strong "house perspective", like The Guardian, doesn't limit itself to publishing only commentaries it fully endorses. I know this is confusing to online readers, and in some cases poor design by the outlets feeds it further, but outlets like this have long tradition of publishing things they don't fully, or even partially, agree with.
Roubini's in the news – just testified for the US Congress – so his perspective is worth understanding, separate from any publications' own beliefs. (And The Guardian is likely to have some sympathy for his opinion, but even there – wrong to attribute Roubini's signed words to the publication.)
No one is saying women and non-white men[0] don't exist in the founding sets and senior engineering sets. They do (and in proportions that to my eye look balanced with the rest of tech, which is damning with faint praise I guess). Many of them are talented, interesting, and perhaps even moral people.
But it's definitely the case that outside of the narrow founding set, there's a very specific population bias in the rank and file of the blockchain community on reddit or steemit or whatever silly "libertarian" competitive echo chamber people are retreating to these days.
It just can't be terribly controversial to say that that there are tons of white men in the community of people around are and never will contribute to blockchain with anything but pennies and zeal, which arguably hurts a growing industry really badly.
[0]: "Russian" is definitely a "white" ethnicity these days. It's pretty wild you're trying to suggest that such a historically rich, anglo-centric and christian nation is somehow an outlier there.
My honest view is that this is the new form of "acceptable" racism. It's not "reverse racism", it's just racism.
The idea that someone's ideas are more or less valid based on the colour of their skin is completely antithetical to the original aims of the civil rights movement.
I agree with you, but it's important to realize that this new form of racism (and by extension, racism in general) doesn't focus on skin colour alone. The focus is on the cultural traits that tend to correlate with skin colour and their implications given the context.
If you group people by skin tone, sex, height, country of residence, or pretty much any other trait, you'll find that average lived experience differs in some way across groups. As a result, if you draw people mostly from one of these groups, say, white men, then this group's ideas, experiences, opinions, etc. are likely (of course, not guaranteed) to differ from the population average. As long as different people are different, this will remain true. In some contexts, some people decide that this non-representation is serious enough to warrant correction. This leads to what you call the new form of acceptable racism.
This thinking is discriminatory by definition, since it assumes things about people based on their skin colour. And it becomes much less palatable if you replace "white men" with pretty much any other demographic. (It's interesting to consider why that is!) But if you know nothing else about the group, knowing their skin colour and, by extension, cultural backgrounds, can inform you about their likely biases. For example, a bunch of old white men probably won't understand the motivations, challenges, and needs in a population of young women of colour.
Replace race with socioeconomic status and you'll get a more complete picture that doesn't rely on traits someone has no control over. "Old white men" is no more an acceptable pejorative than any other in my view.
You are free to hold that view, but nowhere did I see that anyone says their ideas are not valid because they're white.
What I did see was that the claim that cryptocurrency is unlocking power and wealth to impoverished people doesn't hold up to the reality that it's just perpetuating the same financial and power structures that have come before.
And to people who argue against that, well, I'd love to see who, for example, in Africa, is getting rich or at least better-off from the existence of any of various cryptocurrencies. Or where are the people of color in Chicago or Baltimore, spinning up their own coins or empowering their communities, or any of that?
For all the supposed world-changing potential these things supposedly offer, why do the outcomes they're producing so closely resemble the way things already are?
I, for one, would turn my opinion on cryptocurrencies 180 degrees if I saw them being used to give any of the war-torn or impoverished African nations (both of which are a consequence of European colonialism being exploitative and drawing borders to maximize regional conflict) a real leg up on the world stage; and one for all the people, not just the ruling elites there.
Think of it something like a sovereign wealth fund derived from crypto, giving every citizen a monthly draw -- why don't we see anything like that?
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And the explanation, by the way, for why you often see people making the claim that reverse racism isn't a thing is because, in these discussions, racism isn't just hating someone or assuming something about a person based on their skin color, but about the economic and political power structures that get wielded against certain groups based on skin color.
In the US, there's never been a white chattel slavery system (though white supremacists have spun a false narrative about the Irish to try and muddy even this discussion), there's never been policies that exclude whites from living in certain neighborhoods like redlining did for decades, etc. The machinery of the state has never been applied to white people the way it has been applied to people of color time and time again.
Black people can hate white people all they want, but you never see wholesale systematic destruction of white communities like, for example, the Tulsa race riots in the 20s.
So you can say this is all acceptable racism, but I for one can't imagine how anyone can look at any facets of the history of this country and come up with that same constellation of ideas that there's now anti-white acceptable racism.
There's a single counter-example that I think demolishes this entire line of thinking, and it is the rise of "Asian privilege". If Western power structures are inherently racist, they sure dropped the ball on immigrants from the Asian continent (who, by the way, were in recent history pressed into indentured servitude to build railways).
There are no longer any laws on the books that discriminate against people based on their race, gender, or sexual orientation. So certainly there are no legal barriers.
So if your narrative is that there is still systematic racism it's really incumbent on you to provide a factual basis for that claim - and, quite frankly, the evidence is sorely lacking. If you were to remove race from the equation and simply group people by socioeconomic factors like wealth, family composition and attitudes about education, you're likely to find that a middle-class white, black, or Hispanic child has similar chances of success at birth (assuming they belong to a complete family unit with positive views on the value of education). Remove a father from the equation and, regardless of race, their prospects dim considerably.
Race is highly visible, but for the same reason that academic research on the link between IQ and race is shunned I think it's a terrible proxy for comparison of groups.
> There's a single counter-example that I think demolishes this entire line of thinking, and it is the rise of "Asian privilege".
No, it doesn't.
> If Western power structures are inherently racist
They are.
> they sure dropped the ball on immigrants from the Asian continent
They didn't.
> who, by the way, were in recent history pressed into indentured servitude to build railways.
Recent Asian immigrants were not; Asians several generations ago were (many of whom were later expelled.)
Yes, recent Asian immigrants are above average in many respects.
So are recent sub-Saharan African immigrants. Of course, current immigrants and those whose family immigrated in the last couple generations are a lot more of the Asian population in the US than of the population of sub-Saharan African descent.
> There are no longer any laws on the books that discriminate against people based on their race, gender, or sexual orientation.
Yes, there are, and moreover sexual orientation and gender identity are not included in many laws against private discrimination in public accommodations.)
And on top of that, there are many laws which discriminate in ways (particularly geographic) that are tightly associated with race.)
>> There's a single counter-example that I think demolishes this entire line of thinking, and it is the rise of "Asian privilege".
> No, it doesn't.
>> If Western power structures are inherently racist
> They are.
I'm sorry, but the null hypothesis is more likely unless you can provide compelling evidence to the contrary. Repeating the same thing over and over again doesn't make it true.
And the standard is this: show how specific "power structures" discriminate against people based on race in ways that are not attributable to other factors. For example, if the effect is largely explainable by poverty, then your hypothesis has not been proven (even though it may point to another issue).
> And the explanation, by the way, for why you often see people making the claim that reverse racism isn't a thing is because
During the civil rights movement, black supremacists advanced, and others in the movement did not expend sufficient effort counteracting because of (understandable, perhaps) higher priorities, a redefinition of racism designed specifically to exclude (and thereby license) black-against-white racism.
While the intersection of power and prejudice is important for determining the impact of racism, and consequently properly plays a role in prioritizing responses to racism, excluding prejudice without dominant social power as “not racism” and therefore not problematic simply encourages that prejudice to deepen and spread, which is especially problematic when you are trying to deal with the problem that those holding it lack power, because by dealing with that problem without addressing (and, indeed, while licensing) the prejudice, you are helping to create a confluence of power and prejudice.
“Injustice anywhere is a threat to justice everywhere. We are caught in an inescapable network of mutuality, tied in a single garment of destiny. Whatever affects one directly, affects all indirectly.” - MLK jr
> A few self-serving white men (there are hardly any women or minorities in the blockchain universe) pretending to be messiahs for the world’s impoverished, marginalised and unbanked masses claim to have created billions of dollars of wealth out of nothing.
To be fair this spiel is almost the same message you hear out of the startup/VC industry. There is always a hustle when there is fast and easy money around and people wanting to get rich quick. That said there is also real opportunity there if you can see through the cruft, just like in the startup world.
Start-ups can at least deliver some tangible value at the end of the day. I'm still not sure what various cryptocoins deliver other than a get-rich-scheme.
Crypto systems are platforms for fraud and censorship resistant applications. There is value in that, the markets are just having a tough time figuring out how much.
Devcon 3 was in Nov 17 when Ethereum had run up from approx $9 to $300 over the past year and launched a wave of 10x ing ICOs so you can understand them being a bit puffed up.
Now that Ethereum is down from $1300 to $200 and most of the ICOs have crashed or run off with the money I think you will have less of that problem.
I have been explaining to newcomers that there is a difference between Bitcoin and everything else.
Bitcoin has become a man-made institution, similar to fiat, marriage, courts, religion, etc... There are people around the world that believe in the 21,000,000 Bitcoin to store value. The leading idea is that local governments print money and Bitcoin cannot be changed.
Alt coins are trying their best to promote themselves so people early to the market can make money. These are the people attending those conferences. They speak of using blockchain to store data, but this seems inappropriate given that blockchain cannot handle a large volume of transactions. I would guess many are failed/wannabe programmers jumping on a bandwagon.
All you need to do is spend 10 minutes on CryptoTwitter to figure this out. It's immediately apparent that it's a relatively unregulated stock market on steroids. Glorified gambling.
For every 1 part honest decentralization, it's 9 parts greed.
"Using the same standards that categorize 90% of science fiction as trash, crud, or crap, it can be argued that 90% of film, literature, consumer goods, etc. is crap. In other words, the claim (or fact) that 90% of science fiction is crap is ultimately uninformative, because science fiction conforms to the same trends of quality as all other artforms"
That's not really the same thing, the parent says that all cryptocurrencies are 90% greed, not that 90% of cryptocurrencies are only about greed. If it turns out that even 10% of cryptocurrencies are actually not crap it will be huge news. I'm not holding my breath.
Yes... in sci-fi (and other arts and media and consumer goods) you can mostly recognize the crap when you see it and avoid it without doing a lot more than ignoring it. That's why the 90% crap doesn't matter.
With bitcoin though -- and other crytocurrencies and blockchain products generally -- you can't ignore that almost everyone around you is trying their best to get your money.
With sci-fi you can separate the good from the bad without too much trouble. Not so with blockchains.
Normal stock markets facilitate investment in real ventures that provide goods and services to customers with some gambling as a side effect. It remains to be seen if crypto provides much beyond the gambling.
That's how they should be, or how they used to be. It seems that has has reversed (in the 80's?) where stock markets now facilitate gambling with investment in real ventures that provide goods and services to customers as the side effect.
Bitcoin needs to disconnect from the 'cryptocurrency' and 'blockchain' buzzwords.
Like it or not, Bitcoin is already used worldwide and is relatively stable if not positive. (No need to tell me of bandwagoners who bought at All Time Highs)
IMO Bitcoin needs to store value to be useful, not necessarily increase in value.
Look at any forum discussing any cryptocurrency (including bitcoin). Everything is discussed through the filter of "will it pump the value and make us rich?" and there's hardly any in-depth technical discussion because most participants are here to become rich, not to learn about technology or economy.
It also means that any criticism of the technology will be immediately attacked as being "paid shills" with an ulterior motive. It's hard enough to have constructive discussions online, it's almost impossible when people have a financial incentive to defend their position to the bitter end.
Just FYI: The full version of that phrase is the exception that proves the rule false. The idea that the existence of exceptions prove a rule true is, of course, utter nonsense. A rule which is true in some cases but not others is no rule at all.
It's not really true for any forum. It's true that most people are interested in the getting rich part, and I wouldn't expect anything much more different, considering how many(not too many) people incline toward libertarianism and/or are technically competent enough to understand cryptocurrencies and various nuances.
There's probably good discussion on bitcoin mailing lists, and I know there is good discussion on bitcoincore IRC/Slack. Probably some other places I'm missing seeing how I'm not all that involved besides reading some stuff here and there.
Blockchain reminds me a little of the history of the internet but worse . The internet started with good intentions but then in the late 1990s it was all about greed and it took much longer for the value to really show. The main problem with blockchain is that they jumped straight to greed and get-rich-quick schemes before it showed any real world use.
One thing though, the internet was/is solid technology. Underneath the internet bubble was something that worked. Blockchain is promising technology but without solving the scaling issue it will always be just that.
The scaling issue is close to solved - there are a number of rival solutions, time will tell what wins out. There are other issues though such as money laundering regulations.
I expect that the problem won't be solved, and instead we'll get a formal proof that you can't build a fully decentralized, trustless system without Proof of Work, at which point I hope Bitcoin & others will get labeled for what they are: crimes against climate and sustainable energy economy.
Blockchain was once about using technology to solve a problem in a new and exciting way. Then people started to make money off of it. Lots of money. Then it became greed, and the technological progress halted.
Hopefully, enough people lose money so that the technical aspects can return to focus.
Gobs of money transformed the Internet from an engine of open communication and information sharing to an engine of privacy invasion, mass manipulation, and disinformation.
The web was created at CERN and TCP/IP was created by DARPA long before the dot.com bubble and for significantly less money. The people who got rich during and after the dot.com bubble did so not by greatly improving on these technologies but by using them to commoditize human beings and monetize peoples' data. The biggest growth industry on the Internet today is the leveraging of that data toward active deception and con artistry.
I'm speaking of the Internet as most people experience it. You can still of course use the pipes for productive things, but the bulk of the user-facing Internet is now a giant surveillance and manipulation machine targeted at the average user.
The fallacy with your argument, imo, is that cryptocurrencies are only marginally about technology. They aren't a new battery chemistry or transistor fab tech.
They are a pretty simple alternative solution to a longstanding societal need. But one that needs critical mass and low volatility to succeed (arguably).
The problem is that it's not money thrown at it directly.
When you pay a company, they can use that money directly.
When you buy some coins, the developers/the company generally do not benefit directly. Some developers don't even have stake in the coins they create to avoid conflict of interest.
Who profit then? People who already have some of those coins, because you drive up the valuation, and they can resell their coin for higher. Those people can be scammers (pump & dump scheme), cryptocurrencies, your average joe, or the devs, if they got some. You could say, apart from the last category, that they add nothing of value.
Some cryptocurrencies try to have a part of the generated currency pay toward development effort, but that's not the standard.
How much technological progress can we really squeeze out of blockchain, though?
It’s my understanding that it is essential for cryptocurrencies, useful for certain niche applications, but otherwise just one tool among many suitable solutions for problems at hand.
Honestly, what is something blockchain could unequivocally do better than anything else for a large scale application that isn’t cryptocurrencies?
I think there's a lot of potential in "smart contracts", even though that phrase is kind of meaningless now a days.
A simple example of what can happen in the cryptocurrency world: a simple combination of Shamir's Secret Sharing [1] and the public/private key model leads to very easy to use escrow services.
For example, you can create a new wallet with 3-keys, and require 2-of-3 keys to transfer money out. Alice, Bob, and Escrow get the three keys. Anyone can transfer money INTO the wallet and check its value through the public key.
Under normal circumstances, Alice transfers money into the new wallet. Bob then gives Alice a real physical good. Finally, Alice and Bob provide two keys to allow the wallet to transfer money to Bob.
Escrow comes in if any disputes come up. Escrow provides a 2nd key to break any disputes. If Escrow sides with Alice, Escrow + Alice can together use the two keys to transfer the money back to Alice.
While if Escrow sides with Bob, they together can provide two keys to transfer the money to Bob.
True, escrow services do exist in the real world. And arguably, a "real" enforcement mechanism backed up by courts, police, and the government... are far more important than a silly crypto-game.
But the silly-crypto game is automatic, and way cheaper to invoke compared to a full court case. It should be seen as a way to provide escrow services at a cost far cheaper than one backed by courts and lawyers.
For example, "Escrow" can be an automatic email system that gives the 2nd key to Alice after 30 days (encrypted with Alice's public key, of course). Perhaps that's not sufficient for buying a car... but it'd be sufficient Escrow for your typical $20 video game purchase from Steam. As you can see, Bitcoin / Blockchain CAN automate things that used to take courts to invoke. Yes, its of lower quality, but almost any transaction can benefit from an Escrow service (even an Escrow service with default terms)
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The main problem with this scheme (and probably why it isn't popular, even if its technologically possible...) is that BTC or Ethereum's price could change dramatically, even in just 30 days. Cryptocoins simply aren't stable enough for this kind of mechanism to be useful.
In this case, if both dispute, then Alice gets the money back after 30 days.
As I said earlier: this is insufficient for a serious car purchase. But it IS a sufficient mechanism for Steam Games (if "Bob" is Valve/Steam, then Bob can simply revoke access to that game).
Amazon and Ebay also work on this mechanism. Not on Blockchain... but these companies overwhelmingly side with the paying customer (in this case: Alice)... leaving the business owners / service providers at a disadvantage. But Ebay also has a customer-review system attached, so people can tattletale on each other if a particular customer becomes abusive.
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So in effect, you have a "cheap" default policy (in this case: Alice always gets the money back in 30 days by default) for the Escrow, but then you still have to create a review mechanism to handle the various cases of abuse.
If 30-days is insufficient, then 60-day or 180-day return policies exist as well. The point is, anything you can imagine can be the default escrow policy. You can even lock the money away forever by default (IE: FORCE Alice and Bob to work together)... if you really want to go there. Alternatively, the Escrow can have the policy of "We'll only email you the key once you win a court case", if they really want to integrate into the system of law / courts we already have.
That wouldn't be fully automated, but it'd be relatively effort from the perspective of the Escrow business.
Well, for one, Bob can see the BTC or Ethereum in the wallet due to the public blockchain. Bob can be assured that Alice has indeed sent the funds.
Furthermore, the Escrow service isn't actually holding any money. If you were to implement Escrow using today's banking technology, you have to give Escrow the money, and then Escrow gives the money to Bob (or Alice) pending the results of the automated service.
Ex: You can't implement an escrow service using ACH... not at least... without actually taking the money. But with Bitcoin or Ethereum, you can implement an escrow WITHOUT taking any money at all. Escrow can only give the money to Bob (or give it to Alice), provable through encryption.
In effect: Blockchain provides a way to divide the responsibility and prove it through cryptography. The Blockchain Escrow NEVER has access to the funds, throughout the entire transaction. And therefore, it is easier to bootstrap Escrow's reputation.
True, we can use well-trusted banks and courts to handle these transactions. Trusted Escrow services do exist. But my point is that Blockchain could make it cheaper and easier to do.
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I mean, provided that Bitcoin actually can stabilize, among other things. There are a lot of reasons to not do this with BTC or Ethereum, primarily because of the gross variance in price. But still, its a nifty concept.
Its not "change the world" level, but it is certainly a technological advancement in my eyes. Something that could allow new businesses (with lower-trust models) to accomplish things that previously took a lot of trust, and a lot of effort. (IE: Escrow services).
Also non blockchain Escrow can be quite cheap, for example transpact.com:
>Our flat charge means that your costs are normally limited to £2.99 per party for (GB) Pound transactions or €3.49 per party for Euro transactions – that really is it for transactions up to £10,000 / €15,000 !
That tends to be a problem with arguments about crypto/blockchain in general saving money - the alternatives can be cheap and buying/selling crypto costs a bit. It only really seems to come into it's own as a way to skirt the law when fiat transactions are banned by securities laws and similar.
It costs $25 to $35 to file a claim in small-claims court... and more if you go to the greater court system (with lawyers and such).
If you're worried about getting your $20 back, then its counter-productive to use the courts. As such, a cheaper automatic mechanism is just simply going to be more useful to any micro-transaction.
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Non-court mechanisms are the typical: A call to customer service for Amazon almost-always results in the money being returned. Same with Ebay. These are the mechanisms that can be automated.
Courts are needed to settle serious disputes. But the $5 battery pack that doesn't work right... or some other item that was damaged during shipping... that's something you might want to use the automatic escrow over.
The same incentive as selling on Amazon or Ebay, which overwhelmingly caters to the customer.
To attract more customers.
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Lets put it this way: its an automated, strongly provably, money-back guarantee. If you want your money back within 30 days, you can have it through this escrow service.
And I think a lot of companies would be willing to offer money-back guarantees on their services.
It's great how much the potential of cryptocurrency depends on the market cap.
The scariest part to me about cryptocurrency is not the greed, lies and manipulation. It's a centralized cryptocurrency by a major government. Imagine if instead of cash, you had to pay for everything with a digital currency controlled by the US Govt. It'd be all the immutability of cryptocurrency with the monetary policy of the Fed Reserve. I'd bet the IRS and NSA would love the additional data.
>
Gini coefficient of 1.0 means that a single person controls 100% of a country’s income/wealth, North Korea scores 0.86, the rather unequal United States scores 0.41 and bitcoin scores an astonishing 0.88.
This was a bizarre section, and I wanted to make some points about it:
1) The distribution of bitcoins among individuals is not known, any claim to the contrary is false. If you want to make estimates, include the massive uncertainties.
2) Assets do not have Gini coefficients, groups of people do. The distributions of helicopters or Google stock are also very unequal. If you care about wealth inequality among crypto hodlers you should measure that. Conflating the distribution of an asset with the distribution of wealth seems meant to confuse.
3) When bitcoins had 0 value they were much more unequally distributed than now. People starting to value them is the mechanism by which they get distributed. The process is gradual. The more people value them, the more value they accrue.
> 1) The distribution of bitcoins among individuals is not known, any claim to the contrary is false.
How can this be true? Bitcoin is a public ledger and you see every accounts balance. If anything the publicly available account balances seem like a lower bound for the Gini coefficient as it is very likely people have multiple wallets (especially with large balances) where it's unlikely any group of people shares the same wallet (creating and distributing funds among multiple wallets is more secure and trivial).
Lots of people (millions) share the same wallets (technically addresses), as they hold coins on exchanges. The richest bitcoin addresses are the cold storage for the exchanges.
It's strange how much vitriol the author spends against "Blockchain" while being dismissive of its technical merits. In short, I agree -- Blockchain is not the end-all and be-all. It's a natural evolution of the idea of git (and its predecessors) of using a one-sided Merkle tree to compactly store an unforgeable chain of information.
But let's take the word "blockchain" out of this. Is the claim really, "Cryptocurrencies aren't about democracy and decentralisation -- they're about greed."? I mean, the set of cryptocurrencies isn't a short story, they're not "about" anything. So let's assume that we're talking about cryptocurrency supporters.
"All cryptocurrency supporters are not interested in democracy and decentralisation -- they're just greedy". Okay, better, but let's get rid of absolutes.
"Many cryptocurrency supporters are not interested in democracy and decentralisation -- they're just greedy". Okay, now I think we have a statement that is likely true, but is so bland as to be meaningless.
His testimony to the Senate [1] makes a lot of similar points, but the one that I find most annoying because I don't know how an economist can say it, is the line about bitcoin being deflationary:
> That means if a steady- state supply of Bitcoin really did gradually replace a fiat currency, the price index of all goods and services would continuously fall.
This statement, along with so many others talking about Bitcoin is exactly equivalent to saying that "Bitcoin will always increase in value". I'm as big a fan of the potential of Bitcoin as the next person, but even I find this to be ridiculous.
I stopped reading when I saw Nouriel Roubini. He's a smart economist and while I think he has good points on certain things that are wrong with crypto, the way he fundamentally delivers his views in this matter are ridiculous and bitter.
He's been overly passionate (and aggressive?) on trying to make sure he's right. He's shouting it from the rooftops. He keeps repeating it's all a bubble. All good and well, and it very well might be, BUT that in itself doesn't give him credibility. You can say the same thing about the stock market, and once every economic cycle when we see a major correction, you'll be right. A broken clock is also right twice a day.
At the same time, economists usually aren't very wealthy people.. maybe they are overly sceptical of new developments.
> At the same time, economists usually aren't very wealthy people.. maybe they are overly sceptical of new developments.
That's a risible critique of expertise with little applicability to Nouriel Roubini in particular. Last time I checked, Nouriel was living in a $5.5 million penthouse in the East Village, and before that he was in Tribeca.
When bitcoin came out I was excited at the prospect of s free, egalitarian money. While it is free there’s not really anything egalitarian about it unfortunately, and I don’t see it solving huge problems like poverty.
Maybe a coin which is evenly distributed among the population to start would be better.
I spent a while trying to figure how you could issue some token to everyone on the planet. It's hard to get the database and contact them all to give them private keys, as it were.
I technology is not about anything. There are people who try to use it for good of humanity and there are people who try to use it for their personal gains on the cost of others. It's always like this. And if we wouldn't develop technology, they would still use the old ones (e.g. horse riding).
Technology by definition makes some tasks easier at the expense of making some other tasks more difficult. A spoon will help you eat, but it won't help you play football. A gun will help you project power and kill, but you won't eat soup with it.
Similarly, the blockchain is a technology that makes it easier to a) burn through shit ton of electricity, b) propagate scams and get-rich-quick schemes. It doesn't seem to make easier any task that's worth doing and already not better done with another technology.
The goal of a spoon is to make soup eatable. The goal of a blockchain is not to burn through a shit ton of electricity. Therefore I'd argue that your points a and b are mostly side effects, and not even side effects of blockchains. If you run high quality computer games on your system you will also burn through a shit ton of electricity. If you go to another unregulated market you also get a lot of scams and get-rich-quick schemes. Blockchains not even necessitate crypto coins, they can live without it. If you for instance like Kafka but don't like that it's centralized, you could run it on a blockchain as well.
PS: I'd argue that, depending on the type of gun you use, eating soup with a gun is still easier than eating completely without any tools. And does having a spoon really makes you worse at soccer? I'm not sure the intial thesis holds. A tool can make X easier and not make Y harder.
> A few self-serving white men (there are hardly any women or minorities in the blockchain universe) pretending to be messiahs
When I intended to read the article, I was fairly certain identity politics wasn't an axe the author wanted to grind, but he went straight for the jugular!!!
China - which is neither white, and comprises a racial minority in the west, has seen the largest wealth creation in this space. So - the author's statement is technically wrong.
Unlike the Guardian - where an opinion piece isn't approved unless 'White Men' are blamed, the blockchain holds no opinions - you're free to start a feminist-coin without the editor of the Guardian thought policing your piffle into narratives palatable to the Guardian's target audience
I like Roubini despite his arrogance but surely everything to do with currency speculation is about greed? That's essentially what bitcoin is, it has little practical utility in day to day life.
The blockchain world - which as others have pointed out isn't short of cliques and boasters - is more like the early days of the internet IMO. Lots of interesting ideas and ways to leverage new technologies and ideas. Lots of terrible ideas, incompetence, corruption and greed, just like the internet circa 2000...and a few ideas that changed the world
Serious question, what exactly is stopping women and non-whites from creating a blockchain currency and having their own crypto conventions if that's what they wanted? One can do this immediately by sitting at home in one's underwear and forking an existing coin on GitHub.
I don't view those statements as racist or sexist, but I do think that calling a technology racist and sexist by citing a few white male benefactors is incredibly lazy and ultimately damaging to the goal of bringing equality to all.
I find it annoying how people equate blockchain with cryptocurrencies. GIT repos are basically blockchains, yet they have nothing to do with greed nor cryptocurrencies.
> But it has also become the byword for a libertarian ideology that treats all governments, central banks, traditional financial institutions, and real-world currencies as evil concentrations of power that must be destroyed
Would you blame them for wanting that though? Admittedly most people who moved to cryptocurrencies only care about greed, but is this not simply the side effect of the whole scheme becoming popular?
> there are hardly any women or minorities in the blockchain universe
I don't know how true or false this is (especially when considering that there are many cryptocoin farms in china and Russia, as well as the likely Japanese ethnicity of the creator of bitcoin), but I fail to see how this is the fault of cryptocurrencies themselves (with the exception that one already needed money in order to invest in the GPUs).
Any one talking Crypto and Anti-fragile in same sentence seems to have read the book, "The Bitcoin Standard".
To be honest, it is one of the best books that makes case for Crypto specifically Bitcoin or its ilk from historic currency stand point. Let us not forget the President of United States has the right to mint a Trillion Dollar Coin, and some very intelligent people asked him to do that no too long ago (4 years ago?), when there was debt crisis looming in Washington.
Again, all this sounds super complicated economics. There are a ton of facts I can cook up that are legitimate but are meaningless.
The president of the USA can also legally fart in an elevator with CNN and MSNBC reporters in that elevator... But I would guess the president probably won't do that even if they are entitled to.
Well to be honest all human history can be described down to greed - all wars, conquests, colonisation, banking, investing, stocks and more. It's all about making profit.
Whatever bad you can say about blockchain and coins, one is undisputed - it's the first time in hundreds of years when an individual can print money and not be called a criminal. And that's a big shift of power.
To elaborate: thanks to blockchain there's nothing stopping you to create a coin for your group, your neighbourhood or your town - or the internet - that if adopted, will be accepted. And thanks to blockchain that coin actually works, is hard to forge, crack or counterfeit.
And the mainstream electricity argument is short-sighted. Humans need energy to evolve (fyi Kardashev scale). Bitcoin et al is the best incentive to actually create innovative, powerful and cheap energy sources.
it's the first time in hundreds of years when an individual can print money and not be called a criminal...thanks to blockchain there's nothing stopping you to create a coin for your group, your neighbourhood or your town
Local currencies have been created and used in many places all over the world for a long time, without needing anything like crypto. Nobody is being called a criminal over this, it's quite common.
Trick question: all of them are regulated, because they're operating within the legal environment of some country, plus the US tends to claim global jurisdiction on anyone selling things to Americans.
Technically everyone running a bitcoin miner is violating securities law. It's just that SEC enforcement of this is going after the most fraudulent crypto enterprises first.
Nope, printed money is fine too. I used to live in Ithaca, NY, which had a fairly successful printed currency called the "Ithaca Hour": https://en.wikipedia.org/wiki/Ithaca_Hours
> Well to be honest all human history can be described down to greed - all wars, conquests, colonisation, banking, investing, stocks and more. It's all about making profit.
Blockchain's early history was basically crypto-nerds trying to find a new application of cryptography. Back then, people would give away Bitcoins for free in "Bitcoin fountains", and discussion focused on protocol issues and other aspects of building the technology.
Well this scenario applies to so many fields. Social media was a fun way to interact with friends. Then people started to show off professionally and endorse products for cash. Greed. "Greed is good" ;)
I think "Greed can be good" is really what people should realize. Greed is bad in many situations. But if you design your system SUCH THAT Greed is good, then the system will survive.
Bitcoin has a bit of "greed is good" built in: the bitcoin miners are the mechanism that provide timestamps to the whole system. But higher-levels of greed were not accounted for (ex: ASICs farms using up so much electricity that the carbon footprint of BTC is HUGE now).
Have you ever heard of the term "commercial paper"? Look it up: it is any corporation with sound financials being able to "print money" - just using debt and financial instrument terms. But it's the same thing, and is available to any corporation with good credit.
Hmm, is it me or does the word "individual" mean something different than I think it means. Several commenters point me to various currencies that are operated by registered companies or government bodies. How is that related to what I am saying?
Any individual can be a corporation with a little paperwork and incorporation fees. Your statement "it's the first time in hundreds of years when an individual can print money and not be called a criminal" is not correct due the previous sentence being true.
> an individual can print money and not be called a criminal.
> there's nothing stopping you to create a coin for your group
I am not sure this is still true, due to the recent actions by the SEC. Now that ICO's are considered securities, and they are governed by those laws, many people who ran successful ICOs are worried about jail, and many who thought of doing so are no longer.
It is still true as long as you stay small enough to fly under government radar, but that is true if you printed your own local physical money as well, as many fairs and schools do.
You can create a coin with very little effort and technical knowledge. An interview with one of the Turtlecoin developers was done where they created a new fork in a live 2 hour stream. https://www.youtube.com/watch?v=U7oqPL_4uXM
Indeed it's sad, but at least "for a time, it was good". Still, that only applies to some parts of the world at the moment. And I hope the next generation of coins will mitigate these laws.
It was a pretty bold claim lacking evidence but your analogy is way off base. His claim has one missing step, while yours is a journey of a thousand miles.
It's hard to understand your point when you don't lay out a readable argument, but I assume your biggest grief is with the word "best" – ok, "good" also fits. Still can't see why it's so unbelievable to you. Maybe you have to think it through?
From a socialist lense, this article reads like a neoliberal greatest hits piece:
* Conflating anarchism and libertarianism
* Calling a technology racist and sexist
* Russiophobia
* A full-throated support of big banks and the privacy rights of the enterprise.
Furthermore, there are some outright flaws in the piece itself:
* Conflating usage of cryptocurrency in vivo with blockchain as a technology
* Claiming that decentralization of the ledger is a lie because big crypto traders control most of the economy
* Claiming that you can "just fork" the blockchain to fix programming errors, when in reality (at least with Bitcoin) you need a majority to do that (there are initiatives to chang Bitcoin that have failed, afterall).
* Calling an electronic ledger an Excel spreadsheet without any mention of the data integrity benefits.
Really at the end of the day, the author claimed to be attacking blockchain but really just ended up attacking cryptocurrencies.
From a libertarian lens, I find blockchain technically interesting, and see some promise in it's usefulness, but I own zero bitcoins (etc) because the whole cryptocurrency landscape looks immature, treacherous and fraught with peril. Each of your points seems absolutely spot-on. I think readers of any political point of view should be able to spot this as a notably poor article.
Exactly, you only need to look as far as Dash's effort in Venezuela to realize how crypto can benefit society, and if you trust governments not to turn the global stock markets into a glorified casino then look up the terms CDOs, HFT, "Dark pools", ZIRP, bail-ins, etc...
I suppose the stock market would be more like a "rigged casino" since the government's central banks can print money and confiscate funds (see Cyprus), but with pretty much all market leading crypto such things are impossible if you dont store you money on exchanges.
Keeping your cryptocurrency in your own wallet guarantees nothing about its exchange value, though; the "price level" of cryptocurrency absolutely is set by the fraudulent practices of the exchanges even if you don't go near them yourself.
There are "fraudulent practices" in the real world exchanges - look at how LIBOR was/is rigged (https://en.wikipedia.org/wiki/Libor_scandal). And I certainly hope its "exchange value" isn't exactly the same as a government currency as that would defeat the purpose of having something different in the first place...
I don't really get it. Are the people commenting about how useless and stupid Bitcoin and Ethereum are, really putting themselves above Marc Andreessen, Ben Horowitz and Peter Thiel's predictions? I mean. At most, you could be skeptical.
Thinking that it's a joke when even those kinda guys (First successful browser, first cloud computing, first online payment service) are all-in it's mind blowing.
I remember reading the same comments on HF when I was a kid. And even before, about LR.
Guess who found (and will find) himself on the wrong side of history?
It doesn't require comparing one's own intelligence to those guys. One can pick any number of Warren Buffetts who think cryptocurrencies are not good investments. Even though I think Buffett's at least partially wrong on this subject, in a vacuum I'd trust him over all the guys you named combined. But that's just personal preference.
Buffett has always preferred businesses that he can understand, so on that one alone I can see why he doesn't like crypto.
Secondly, I don't think crypto is good as an investment (as opposed to a vehicle for speculation) but I see all sort of opportunities in killing the middle men of banks. No more boom and bust because the fed won't read Hayek; No more having to beg and scrape to be allowed to send a transaction through the archaic inter-bank transfer system; No more inflation forcing people to put savings in riskier and riskier businesses to keep up with the printing; No more dirt poor refugees who have to leave every thing behind; No more hyperinflation because dictators needs to be the sole source of food.
It's HF and LR, not HR and LF, that alone, shows your efforts. LR stands for Liberty Reserve, HF for HackerForum.
Buffet didn't create or invest successfully in anything software-related. If you put the opinion of a guy who made his fortune with Coca Cola and Insurance above the ones who made it with tech -when evaluating the future- that's fine. To each their own I guess?
You found yourself on the wrong side of history, and sounds like it'll happen again.
So that's basically an appeal to authority. If 90% of all startups fail, that means VCs like those you listed are only right 10% of the time.
There are many objective reasons to take the other side of the bet:
Bitcoin will not succeed as a mainstream payment processing system because:
* The fees are unpredictable and average tx fees have been as high as $55 in the past, during it's most popular time.
* Apropos to the above, Bitcoin doesn't scale and it is clear there is no effective governance method in order to mitigate the problem. Cf. block size wars.
* The risk to the consumer is higher as there is no included fraud protection or chargebacks allowed.
* The difficulty of use is higher for the consumer, who now has to deal with purchasing fees and speculative volatility.
* It is accepted at an extremely low amount of vendors and even that is falling.
* Loss of private key, or password, or security exploit can lead to total loss of funds.
Blockchains will not succeed as a mainstream technological solution because:
* The use cases where you actually need a public, proof of work mined chain are actually very niche outside of cryptocurrencies themselves.
* Even if you have a use case that fits, you must reach a critical mass of mining hash rate or you open yourself to trivially exploitable 51% attacks.
* Corporations will still want to have permission based access, but if you have trusted users then you don't need a blockchain.
* Even if you go with a private blockchain anyway, the scalability isn't there, it is harder to use, the tooling is worse, the technology is less mature, and the upside for the increased difficulty and cost is marginal.
No. No. No. You didn't do your homework. Both A16Z and Peter Thiel see Bitcoin as a store of value and Ethereum as a computing platform. Ethereum is a new paradigm only useful in applications where trust is paramount and/or there's generally lack of it between parties.
Mobile brought Instagram and Uber - simply because phones have a GPS and they're always with you. Not because they're a more powerful computing platform or smth.
TUSD and GUSD might be used for payments infra (they're stable).
I realize that many people still think of Bitcoin as a payment method and Ethereum as a place where it makes sense to build anything on (e.g social networks). But we're talking about A16Z's and PT's views (Which imo, are correct)
A few self-serving white men (there are hardly any women or minorities in the blockchain universe) pretending to be messiahs for the world’s impoverished, marginalised and unbanked masses claim to have created billions of dollars of wealth out of nothing.
>>>
I do not agree with the entire statement, but the amount of "self-congratulatory" shit that goes in Blockchain conferences is mind boggling. I went Ethereum Devcon 3, and its not hyperbole when I say ONE entire day of 4 days of conference was about patting on the back.