For a marketing app like this, really the people paying should be the restaurants. They pay a bit of money, they appear a bit more often, and a bit more at the beginning of the list of dishes displayed. Cool idea and makes a lot of sense!
Also should consider what was selected last time - a bit of a predictive algorithm would be useful to start providing towards my likes a bit quicker.
(Disclaimer - I work in this space, but these words are my own).
My understanding is DIDs are a unique identifier. There's a few methods that can be used regarding the construction of the identifier. It could be a unique key (did:key- https://w3c-ccg.github.io/did-method-key/). It could be using web infrastructure (did:web - https://w3c-ccg.github.io/did-method-web/). It could be using blockchain infrastructure (did:ion).
Whatever it is, it becomes an identifier used to receive credentials and send messages to. For example, your digital wallet can have a DID which can be used to store credentials. Your digital wallet can have many DIDs which can be useful to avoid correlation of identities.
The credentials (and the identities they represent) themselves are normally bundled into things like Verifiable Credentials (https://www.w3.org/TR/vc-data-model/) which have to be issued to something - like a DID.
On second reading with that background knowledge, the crypto pedigree reveals itself: "decentralized", "distributed", "independently of any centralized registry", "distributed ledger", "non-registry based", etc...
It all makes sense now! It's yet another attempt at making Web 3.0 happen.
I'd argue that of those, "distributed ledger" is the only real red-flaggy one -- and even then, only because of its association with blockchain. I think when engineering web technologies, we should hope to find a lot of talk about decentralized, distributed stuff independent of central registries.
No, this is what identity politics is, reducing technical matters to which camp you're in ("your post gives me crypto vibes, scam!!"). Correct me if I'm wrong but I believe this doesn't belong on HN.
No. Broad technical camps are not identity politics, and they're a necessary simplification for making judgements about the massive amount of technical novelty being produced today. I am not going to investigate each crypto scam presented to me for all of its technical details; there are too many of them. It's enough to know it's cryptocurrency-adjacent, and therefore, probably a scam.
Why are Bitcoin maxis and HN Web 2.0 people so intent on keeping everyone from advancing to the next phases of the Web?
Do you like centralized VC-funded “cloud”-hosted startups incubated in Silicon Valley that get gobbled up by big tech or dumped on the public? You like the extreme power inequality between those who run these systems and the public? You think the best our systems can do is extract rents at the behest of Wall Street? People who bought the shares at $100 dont want them to drop to $50 so Uber will take 50% of all drivers’ paychecks, while a decentralized autonomous network wouldn’t. Selling tokens is a one-time deal that makes the founders rich and then the network belongs to the participants.
What happened to the open source, hacker ethos? You know, counterculture, hacking on something, or at the very least not buying into the corporate morass? What happened to cypherpunks and people who wrote M$ and worked on Free Software alternatives to Big Tech?
Once upon a time America Online, Compuserve and Prodigy were today’s Google, Facebook etc. People left for the open, decentralized protocols like HTTP, as soon as good enough clients (browsers) appeared. Web 2.0 companies like FB or Google could have never even gotten started if they needed permission of AOL or MSN … the permissionless nature Web 1.0 made it possible.
Once upon a time, long distance calls cost $3 a minute. Then the decentralized file sharing network Kazaa guys made Skype, and it became so widespread that VOIP dropped the cost to zero. We can all videoconference now and the telcos are reduced to providing dumb pipes.
So why if Web 1.0 broke barriers and allowed anyone to write some HTML and serve via HTTP a website to the whole world … why is it sooooo terrible that in Web 3.0 people can write a smart contract and deploy it on some EVM compatible blockchain making the rules or payments instantly accessible to people around the world who control their own keys? Do you really think this won’t have any real applications?
Because if you actually look at what cryptocurrency is being used for, it’s overwhelmingly:
- Scams
- Risky financial structures that we regulated out of existence because they were risky and unregulated
- Money laundering
If there are real applications of the technology, they would’ve popped up by now.
Just look at the whole space of cryptocurrency lending. Regulations exist for good reason, we have stress tests https://www.federalreserve.gov/publications/large-bank-capit..., consumer protections, all kinds of safeguard so when you put money in a bank account you don’t have to worry that somebody’s gonna run with it.
Web 3.0 is a buzzword-filled collective hallucination. People keep shouting the buzzwords, but still nobody knows what it’s supposed to mean in any concrete way. NFTs are scams and still haven’t found a real use case that’s not a ponzi, crypto lending is 2008 capital structures but turned up to 11, DAOs are useless because courts and corporate governance are things that exists, I can go on and on.
If you have a concrete proposal of how this magical Web 3.0 future is supposed to be better I’m all ears, but where I’m standing it’s all ponzi, scams, shaky capital structuring, and criminal enterprises.
You have no idea how serious the problems Bitcoin is trying to solve are.
One day you will be forced to understand it though. Hopefully it doesn't result in you losing all your savings, like it has happened to billions of people through history....
> "Do you really think this won’t have any real applications?"
So where are they? The consensus is denying it on principle but rather wondering what it's actually useful for. It's strange to see all the claims of opportunities and problems to solve, yet nothing seems to be produced.
Many of them are here, fully documented and explained to laypeople, with links to GitHub, feel free to take the open source software and use them: https://intercoin.org/applications
Is that not good enough for now? What more would you like?
I am philosophically opposed to "Web 3.0" because I am philosophically opposed to cryptocurrency and do not believe it decentralizes anything.
Regardless of the follies of Wall Street, blockchains and smart contracts do not fix them. There is no particular reason why a DAO would not also cut worker wages to benefit the tokenholder class - it's the exact same structure as a corporation, just without the pesky regulation getting in the way. There is nothing about decentralized finance that guarantees that the employees are also tokenholders anymore than regular ol' brick-and-mortar capitalism guarantees that employees are also shareholders. If you want a worker's cooperative, you can start one right now without needing to buy Ethereum and develop a fragile smart contract.
DeFi isn't destroying power structures, nor is it making them less rigid. It's just a changing of the guard, from corporations and investors to anonymous "whales" and DAOs. This isn't actually decentralizing anything, it's just obfuscating how much the system has been corrupted.
As for open source and Free Software, well... their political opinions outside of hacker ethos are all over the map. The space is vaguely libertarian and vaguely leftist, which means there's plenty of people in the space who don't want more unregulated capitalism.
Your example about long distance calls is also wrong. Or, at least, missing some context. Skype was actually kind of late to the "cheap long-distance" party; the government had already done the hard work of breaking up the phone monopoly and ensuring that companies could place and terminate calls on other people's networks. This is because "permissionless" is not a capability, it is a policy. Even ostensibly permissionless blockchains could effectively become permissioned if miners and exchanges colluded in a way that made economic sense. I know this can happen because it's exactly the same thing that happened in Web 2.0.
It might have something to do with all the cryptobro’s pushing get-rich-quick-schemes. Crypto-enthusiasts ignore how regulations existed for good reasons before regulatory capture made a mess of things. Not everyone likes the idea of an anarchocapitalist future.
And I’m not even talking about the outright scamming and the fact that most crypto’s primary use case is criminal. Or the environmental issues of spending energy we can’t spare on something we could solve so many other ways.
I personally take a hesitant approach to crypto/blockchain technology. I'm open to using it where it's legitimately better than other approaches, but for the vast, vast majority of applications traditional methods are always going to be better than shoe-horned decentralization.
It's very unfortunate that the grifters have given the technology such a bad name when, like any technology, it has applications it excels in and others it doesn't. We're still definitely in the phase of working out what, if anything, blockchain is better (than centralised implementations) for. And it sucks that that search is being negatively impacted by all the grifters.
In the future I wouldn't be surprised if we saw 99.99% of blockchain stuff dead, but the small percentage that survive could disrupt some industries (I'm not convinced finance is one of those industries though lol).
1. Except cryptocurrencies aren't any good for that, because the transaction costs are too high, and the value of cryptocurrencies too volatile. Cryptocurrencies are not a medium of exchange.
2. Now, what's a valid use-case for a smart contract, and please explain how it functions if there's a bug in the contract?
3. Maybe. You'll need to provide a more concrete use-case. Also, you have the outside-world problem (you know the data hasn't been altered, but you don't necessarily know where it comes from).
4. All you need for decentralized identities is a public key. (Though if you want your identity to be long-lived, you'll have to also have a system of secure key rotation, and the most straightforward system is blockchain-ish in that it involves a signed append-only log. But it doesn't need a global trustless ledger.
5. See 1, except worse, because the transaction cost dwarf the actual payment.
1. If you're sending a portion of your monthly wages as a remittance to your family, spending a dollar[1] isn't too much.
2. A smart contract allows decentralised organisations to function, with democratic voting and transparency. (That's not appropriate or necessary for every organisation, but it can be an improvement on one person hosting a server and saying "Trust me"). If there's a bug in the contract, you have to vote to change the contract. Traditional contracts, businesses, and even countries fail all the time, but we haven't give up on them as concepts.
3. For a concrete use-case, I offer the example of blockchain technology being used to make the fishing industry supply chain more transparent.[3] It's true that someone could enter fake information onto the blockchain, but they could also fake signatures on paperwork, so a system can still be useful even if it doesn't prevent all possible attacks.
4. If the ledger isn't trustless, then someone is controlling it, so your identities aren't really decentralised.
5. There are better currencies than BTC if transaction costs are the main concern. The equivalent number for BCH is half a cent.[5]
> A smart contract allows decentralised organisations to function, with democratic voting and transparency.
A smart contract is neither smart, nor a contract. It's a program, written in an esoteric language, and running in the world's most inefficient VM.
It's so bad and overcomplicated that "smart contract" authors themselves routinely make mistakes in code equivalent to the most basic of actual contracts. And since there's no avenue of recourse, these mistakes are irreversible.
"Smart contracts" also require the user to pay for any meaningful action.
As for "transparency", there's no transparency when something is enforced by code very few can read and understand (compared to actual contracts that can be read by humans).
As for "democracy", there's nothing democratic about "who has the most money has the most votes".
> Traditional contracts, businesses, and even countries fail all the time, but we haven't give up on them as concepts
Because we have thousands of years of history teaching us how to deal with those, and guess what, we've come up with multiple things like:
- regulations
- contract clauses dealing with failure
- avenues of recourse
- various methods of enforcement
Crypto bros pretend that these things are unnecessary, but then immediately turn to courts to sue scammers, or cry in cryptoforums when a "smart contract" bug wipes their wallets out.
Sorry, but you sound like tech skeptics in every generation ever, saying “the Dewey Decimal system works perfectly well, why do we need computers just to find a book”? (Yes, I have heard this exact objection raised by radio hosts to early computer pioneers who tried to explain why computers will become useful for regular people.)
Email became useful and replaced the post office
Web 1.0 became useful and replaced TV, radio, magazines
Web 2.0 became useful and allowed people to communicate but still hasn’t been truly decentralized
What makes you think that Web3 replacing trusted gatekeepers is not useful? You think “just trust me” is the best system we can possibly have for writing code that does some business logic?
For me it’s simple: if there is something that’s very valuable (some NFT, some role, some election, some large balance of USDT) then I prefer that my customers custody their own keys and deal with that themselves. Less liability for me. Rather than having a guy with keys to the database log in and potentially change the result of an election, and having to track down logs and deal with lawsuits etc. I just want smart contracts to deal with it, and each participant can only take the actions they are allowed to take - no exceptions. No central point of failure for security. No need for audits OF TRANSACTIONSby auditors who can also be corrupted.
How do we make sure that smart contracts are correct? Audits, battle testing and with Cardano we even have provable correctness. UniSwap likely has no exploitable bugs, for instance, or they would have been found. Every instance of UniSwap AMMs comes out of the same factory. THE END RESULT is far more reliable than any code that runs on only one machine by a “trust me” corp.
Sorry buddy, you can shill your centralized “trust me” all you want but you sound like Peter Schiff and his gold. You just don’t get it.
1. No liability for transactions, only for code
2. Open source infrastructure
3. No central entities who can corrupt the system in unlimited ways
4. People can only do what is allowed, no matter what
5. Code operates regardless of whether the central entity is around in 20-30 years
6. Different incentives (selling tokens is far more user-friendly than selling shares to a parasitic investor class that will cause you to extract rents forever and introduce dark patterns and lockin at the expense of the public).
7. Interoperability — on-chain data can be used for other smart contracts and any websites can read the data.
8. Global interoperability, no need to rely on a patchwork of currencies and money transmission legs and banks that Stripe takes care of for you. USDC is an ERC20 token and you write code, not connecting to a billion little APIs. Similarly to HTTP letting you go worldwide vs what Twilio had to do for you, or negotiating syndication by radio stations.
Of course I think blockchain is a first-gen technology but it enables this and a lot more !
Here's the problem: people don't care about even one of the eight things you listed there. None of these things matter to the common person, and they certainly don't matter to the preeminent payment infrastructure.
Nobody here is shilling for centralized services, most of us are veterans of decentralized tech giving you warnings. Many projects have encountered these same issues, and have died because they have no purpose. Blockchains are little more than nerd porn, the average banker isn't going to look a trustless infrastructure and all of the sudden "get it". That's one of many insurmountable problems that cryptocurrency faces, and it has been successfully blocking adoption of it in the real world for more than 10 years. You can't simply shrug off decades of decentralized failure without applying the lessons you learned from watching them fall. Unfortunately, every cryptocurrency I've found is tone-deaf to these concerns, and prefers to replace genuine conversation with marketing crap.
The only concrete use case you've offered “is unlikely to deliver substantial gains to the industry when compared to alternatives” such as shared databases, which don't require any costly consensus algorithm.
They are (at least) two separate use cases, even though they are both examples of sending money. (You could equally say that they are all examples of sending data).
1. Some people want to be able to send large amounts of money internationally to their family in a country which has currency controls and "official" exchange rates. Others want to be able to send funds to organisations that have been banned by traditional money transmitters, such as Wikileaks, or protest groups, or adult content, or cannabis.
5. Separate groups of people don't have a problem with their government's fiscal or censorship policies, but simply want to be able to buy an emote or a skin in an online game, or to listen to a piece of music or read an article without being tracked around the web or needing to wire 50 cents from their bank in Mongolia to the service provider's bank in Cyprus.
1. The problem there is exactly why the space is going to remain a reserve for fundamentally illegal activity.
Arguably it shouldn't be. I get that. That still doesn't get me any closer to me suggesting anyone's grandma hop into Web3.
5. So you're still being tracked, because there isn't a company around that isn't monetizing viewership data. Also, if you're fine with fiscal policies, why are you hesitant to wire? Sounds to me like you're dissatisfied with your host country's fiscal controls, or service provider's offerings.
Look, control over financial networks is one of the most powerful soft control mechanisms on the planet. You will not work around that. Government is slow to catch up, but I assure you, these folks aren't stupid anywhere close to 100% of the time. The fact regulation is crystalizing around crypto as fast as it is without taking the multi-century learning experience trad-fi did is evidence enough of that.
If it comes down to "a bunch of nerds created an unregulable financial system" I can pretty much guarantee it'll get gobbled by trad-fi snd re-centralized.
In fact, anyone could roll their own financial networks without using banks/Visa/you name it. No one has because we've made laws that specifically increase the barrier to entry because finance is the spine that provides support for all manner of economic activity, which includes the illegal stuff, and Government is putatively in the business of making sure that the illegal stuff doesn't see the light of day.
I just do not see the compelling argument that'll carry weight to switch someone from "financial system that makes crime hard" to "financial system that makes crime easy" and feel alright about it. You have to already accept that crime is just an endemic human phenomena, and this is just a rebalancing of the spectrum.
Given you've got much more efficient implementations of your other use cases available, this is the sticking point for me. No people I've spoken to and laid out what Web3 really is, even with the most charitable framing gets passed that.
If I can't convince people it's a good idea with full disclosure in effect, I'm not sure it's something worth pushing forward.
I don't really think there are five applications it excels in, but there might be in the future..?
Like I said, we're still working out what it's good for. I've seen promising applications but nothing I'd say is obviously better than traditional technology. To dismiss the entire technology because of (admittedly a lot of) grifters is premature in my opinion.
So Web2 has gotten such a bad name due to centralized bullshit that entire democracies are up in arms. And the Zucks of the world just say “Calm down. Breathe. We hear you” and proceed to continue to do the very thing people have been mad about (Libra? Beacon?)
Zuck correctly described the situation early on: “I don’t know. They ‘trust me’. Dumb f#%ks”. And it’s still true today and you want to bury any alternative to that system.
Transparency laws, stricter regulation on moving between regulatory agencies and regulated industries, in general, better democratic accountability. All of these are imperfect, but it's also the case that cryptocurrency doesn't make any of it better.
>stricter regulation on moving between regulatory agencies and regulated industries
You seem to assume the existence of a competent and non-corrupt metaregulator (some form of supervisory body that would "regulate the regulators" and somehow prevent "revolving door" scenarios).
- If it exists, why was long-term regulatory capture possible in the first place?
- If it doesn't, how would we go about instituting one?
We're on Hacker News. Exit wishful thinking, enter systems thinking.
- Feedback between regulatory agency and regulated industry: continuous.
- Feedback between regulatory agency and supervisory body: continuous.
- Feedback between supervisory body and sovereign (=the general public getting shafted by the regulatory capture): discrete, and of appalingly low resolution.
I'm told that in the world's dominant democracy, where most of the ideas that we're discussing originate, the sovereign is throttled to expressing its interest in the form of a binary decision once every ~35000 hours.
So, the boffins at the revolving door email each other and call each other on the phone all the time, but the public can only talk to the legislature at the grand rate of 1 bit per 4 years? In that case, I'm prone to applying the concept of "regulatory capture" to any and all regulation that nominally serve the public interest. They simply don't have the bandwidth to establish what the public interest is.
Even at Bitcoin's "low" speed of 7 transactions per second, on-chain voting would still support a much faster democratic process. That's why people are opposed to it. For now, people use cryptos to vote mostly on inconsequential things. That's while the quirks are being ironed out. Some crypto bros who got in for teh gainz got shafted. So what. Maybe in a fairer economic system a fool and his money would be parted even more easily.
Currently, crypto does not work... except as a public "exit"/"no confidence" vote towards the methods through which industry is organized and regulation is instituted. For one to devote time and effort to this emergent form of economic organization, no matter how uncertain its realities might be, is simply to refuse to take part in maintaining a status quo that one has had no part in establishing - and to look for alternatives, no matter how tenuous.
I think a tender is really a blind bid. A bunch of offers from different people (the tenders) are received before a deadline, and then the vendor views them all and chooses whatever one they like (which is probably the highest offer).
I've just bought a house, and it's been interesting to see the selling method change as the market goes from hot to cold - Auction, Tender, Deadline, Buyer Enquires Over, Asking price.
As someone who lived in Canada, lives next to Australia, and lives in New Zealand, I wouldn't suggest any of these places are 'devolving into police states'.
Having people do stuff to protect the safety of themselves and others is part of the social contract of these countries. We wear seatbelts. We wear helmets on Motorbikes. All things that restrict our freedom to damage ourselves.
Because who incurs the cost of when you hurt yourself or others? The government! Like a lot of advanced countries we have a single payer government operated healthcare system that needs to ration care since nothing in life is infinite. So governments are motivated to protect systems that protect everyone like healthcare.
Yes, I'm ecstatic we pay a ton of taxes to have one of the worst healthcare systems in the developed world. Well behind the EU and OECD averages. We've got 1/3 the doctors per capita of France FFS...
Now we get to continue to pay a ton of taxes to have a shitty healthcare system AND have business and travel restrictions. Good deal.
Know what else was part of the social contract? Things like freedom of travel, the ability to run a business without government interference... Now Canada's whole economy is a housing ponzi scheme and everyone I know is selling their businesses and/or leaving the country.
What bugs me about the "we can't overwhelm the health care system" argument is that when/if this is all over, NOTHING will be done to improve the health care system to help prevent that from happening in the future. We'll all just continue to be told to be mad at each other, and no one in charge will be held accountable.
AFAICT, Quebec was probably the only province to do the most effective thing to improve the health care system: increasing the wages of nurses. Only half-heartedly because it was a bonus not a raise, but it's a lot better than Ontario which is effectively reducing the wages of their nurses after inflation by legislatively capping raises to 1%.
Here's hoping it's a major election issue in Ontario this summer.
I hope it is, but sadly people have short memories. I worry Ford will announce an end to all restrictions come election time so people focus on that instead of all the cuts.
"There is not a single example of a country with less than 40% of the population overweight that has high death rates (over 10 per 100 000). Similarly, no country with a death rate over 100 per 100 000 had less than 50% of their population overweight.
When are we going to start banning overweight from consuming alcohol and eating fast food? They're putting tremendous pressure on our universal healthcare system!
Yes we have a social contract. Yes people take measures such as seatbelts and helmets. No, neither of those are the same as mandating individuals to take a vaccine that has limited benefit for the majority of people. Following a year long media campaign of fear, after accepting lockdowns, the only supposed solution is taking a vaccine that has been sped through clinical trials and at best serves to reduce the severity for those most at risk from Covid.
I see pure coercion. How long before access to the majority of vital services will be dependant on 'up to date' vaccination status, checked and logged in via your app whenever you travel, shop, work. How long before this turns into a social credit system?
As an Australian who was concerned enough to emigrate, i'd suggest learning about the security laws passed over the last 10 years and considering how it matches the opportunistic actions taken during the pandemic. Maybe you like the police state and it is somewhat democratic so far but that doesnt mean isn't quite literally a police state.
Less drastically, a lot of places are putting heavy restrictions on smoking, and there are heavy taxes on tobacco and alcohol (arguably those taxes contribute to paying for tobacco and alcohol related health problems.)
Seat belts and helmets do not require chemicals to be injected into your bloodstream in order to freely associate with other humans. These measures change free association by making it illegal to exist naturally around others. There is a huge difference.
Well, no, which is why we don't mandate vaccines against viruses which don't cause once-in-a-century pandemics. But that's separate from what I wanted to respond to, which was the false equivalence between seatbelts/helmets and vaccines.
The new authoritarian infrastructure that we put in place in order to "combat the pandemic" will live long after the pandemic, and negatively affect the lives of everyone going forward. Governments do not have a track record of giving up power.
Telling people to stay indoors if they're scared is much more preferable to injecting government into every aspect of our lives.
Also I'm not sure why you're mentioning false equivalence to me, since I am also highlighting the false equivalence between vaccines and seat belts.
Sorry, you're right, and in that sense we're on the same side: I shouldn't have written "false equivalence." I meant to point out that your objection of "well, seatbelts don't require you to inject chemicals into your body, so there's a huge difference" is irrelevant precisely because there is a huge difference between the bad outcome that seatbelts prevent the bad outcome that vaccines prevent.
Australia is not a police state. Its a state with a complex federal structure which has concerns about broad-brush legislative change, but thats about boil-the-frog-slowly changes, which are being resisted in the senate.
We are not under martial law, or required to register with the police, or subject to wide-ranging arbitrary constraints.
We have temporary, government moderated, revokable restrictions under public health orders which have existed for decades. It is true that some lazy states sought to increase minister-directed powers but this didn't just slip through parliament.
Have you payed for building the roads you drive or walk on to work? The pipes that deliver your water? The fire services? Do you imagine you pay the full cost of the food you are eating? Of the irrigation systems? Garbage pick up and disposal? Management of your local community, including things like accounting for its money etc?
All those things existed before confiscatory taxes were imposed on basically all forms of economic activity. None have improved while the government has stolen 50%+ of my income. In fact they have universally gotten worse, and still more expensive.
This is just "basic infrastructure as a service", except the only service you're actually getting for your payment is not going to jail. That's called extortion.
> All those things existed before confiscatory taxes were imposed on basically all forms of economic activity.
When exactly in history do you imagine these services existed, but there were no taxes? Do you somehow imagine Kings weren't collecting taxes (the original reason for the American Revolution)?
Like the tide slowly lapping away at your feet, the symptoms of burnout aren’t noticeable until you’re already waist deep, and then you can keep swimming, until suddenly your brain says, no thanks.
I think that’s the worst part, the fact that this burnout process is happening to you, and regardless of your mental ability, you can’t outwork it, or outwill it, or outwish it.
But personally I see it as your brain providing you a health and safety moment - there is danger in your current approach, and the circuit breaker has been tripped.
I've seen a lot of news reports talking about people receiving $16,000 bills. Yes, that's because they're with a power company that charges the market rate for electricity. When there's a scarcity of electricity, the market rate goes way up. In fact, during those events that price increase is what encourages generators to bring on more supply to capture that revenue.
All of that in itself isn't evil. But the retailer could have been more proactive to say "During terrible winter storms, paying the market rate is a bad idea. Switch companies now." Or a better idea would have been to charge $X a day as insurance, that would cap the price per kWh to $X. That way people have certainty as to what their maximum charge is. Imagine if the power company said "Pay $10 extra a month, and we'll make sure that in an adverse event, your bill for your normally consumed 1000 kWh would be $1000".
The New Zealand electricity market is similarly deregulated like Texas and has some of the same benefits and problems. The great thing is you can choose your power retailer, that all have different types of plans that work for different people. Some only buy from 'green generators'. Some allow you to buy 'packs of electricity' in advance, a bit like buying a hedge. Imagine having 1000 kWh in your bank to spend during this peak event. Some don't charge daily rates for your holiday home. I like the innovation in the retail market.
But that doesn't prohibit transmission companies, and generators from investing in their assets. Transmission companies are a natural monopoly so should be constrained from the free market. In NZ most of those have a maximum rate of return they're allowed to extract from their assets, so their profit is restricted. In turn they lobby to invest more into their assets which in turn increases their allowed profit. This leads to an outcome of overinvestments in assets, which in Texas's case might not be such a bad thing.
Generators make their typical profit based on stable generation. They make their windfall based on adverse weather events, different hydrology, competing generator capacity going offline etc. The NZ market would have automated 5 minute auctions where the Grid Operator would purchase the cheapest bid from generators to meet the grid demand in that 5 minute block. There would also be diesel generators that would be guaranteed to provide the most expensive supply if things went wrong, so that would be the upper limit on the market.
> One power supplier, Griddy, told all 29,000 of its customers that they should switch to another provider as spot electricity prices soared to as high as $9,000 a megawatt-hour. Griddy’s customers are fully exposed to the real-time swings in wholesale power markets, so those who don’t leave soon will face extraordinarily high electricity bills.
> “We made the unprecedented decision to tell our customers -- whom we worked really hard to get -- that they are better off in the near term with another provider,” said Michael Fallquist, chief executive officer of Griddy. “We want what’s right by our consumers, so we are encouraging them to leave. We believe that transparency and that honesty will bring them back” once prices return to normal.
One problem is when an event like this happened in New Zealand, other retailers didn't accept new customers at this time. I mean, would you accept new customers paying 20 cents a kWh when the market rate is 500 cents a kWh?
And that is the age old problem. People sign into a "deal" contract to save $5 now, but with a 1/1000 chance of someday losing $1000. And then they hit the spike and what happens?
a) Extra charge is forgiven?
b) Someone else picks up the tab?
c) They are stuck paying it?
And how do you deal with this big picture?
a) Require better legal language in the contracts to sign up for this
b) Ban these kind of contracts, because the user isn't "smart" enough to know how they work
Similar things happen in a floodplain where no one will issue flood insurance. It's mostly fine, until it isn't.
That's where I think things like Tesla's Powerwall becomes so handy. Imagine 95 kWh just sitting there on your wall. Or in your Model-S. When there's an adverse power event, use your battery. Or, sell it back to the grid if there's money to be made.
What sucks is powerwall cost $7.5k for 6.5 kWh of storage. A decent sized house is going to need 2-4 to handle a reasonable outage, and if you want to be able to power an AC.
My Model Y has a 75 kWh of battery just sitting in my garage, and S/X owners have 100 kWh (maybe 90 after refresh?). Really wish Teslas could use a vehicle to grid to somehow tie into a homebase powerwall for this kind of situation. My understanding is there is no inbuilt way to get more than what is needed to charge the 12V out of a Tesla...
>> during those events that price increase is what encourages generators to bring on more supply to capture that revenue.
True, in a perfect theoretical world where infinite capacities can be achieved through price increases. In the real world, there are only so many operational power producers. Raising the prices does literally nothing for powerplants physically incapable of coming online soon enough to enjoy those prices. And as this was such a short-term boom, there is no incentive to weatherize in anticipation of the next boom as the potential yields still outweigh immediate costs. Despite the bluster, Texas's power grid is not a free market utopia where supply and demand solves all problems. Texas simply isn't big enough for such principals to act before running up against hard practical realities.
OR, you could collude and not bring power online to reap massive amounts of money in short term predatory bursts, since people can't switch providers quickly when there's no power, internet, etc.
Basically that is some of what caused the California blackouts back in the Enron days. The elasticity of the market with respect to consumers choosing a different provider is pretty inelastic, in the best case it's one month. Meanwhile, Enron was doing hourly manipulations of power plant shutdowns.
What you're posting here, even though it's a garden variety laissez faire microeconomic argument, actually advocates for the opposite: regulation to eliminate spike pricing.
In this case, regulation would have made a more robust system, with better ability to pull from surrounding grids, and avoided the shock pricing.
Can you imagine you show up at a hospital during, say, a large scale pandemic that has reduced the capacity of the hospital, and told that your necessary emergency surgery was going to cost 100x more than normal in order to "incent" more surgeons to work?
And do you think people should be actively switching power providers on a daily basis? Should everyone have a TV "dashboard" indicating energy market conditions? And should they quit their day jobs to do that?
Pure market microeconomics is a fantasy, human computation for market prices is far too limited, information is far too limited. When its pushed to the extremes, chances are what is happening is the Enron-type market manipulators are creating opportunities for them to extract money from created chaos.
> Imagine if the power company said "Pay $10 extra a month, and we'll make sure that in an adverse event, your bill for your normally consumed 1000 kWh would be $1000".
Alternatively, imagine if critical services like this were managed directly by the state, so that the cost of these adverse things was absorbed into the tax base rather than privatized by insurance companies (which eventually go bust and end up bailed out by the state anyway).
I live in Ontario at the moment, which is a very regulated power market. I can only buy from one retailer. They in turn get charged a singular price from the generator. The government can mandate what that price is, which is lower at the moment because of Covid.
That stuff is great for me as a consumer. But selling power below the cost of production seems like a weird economic model. And you still pay for these reductions somehow. In Ontario, the government mandates a rebate (https://www.torontohydro.com/for-home/ontario-electricity-re...). But who pays for that rebate? The taxpayers! So you get a discount on your power, paid for from your income!
I'm not an 'all-in free market' guy. I do think regulation is required to constrain the free market to operate within certain parameters. But I also don't agree that all 'critical services' should be managed directly by the state. I remember that the state used to run the Telephone network in NZ, and it would take 6 weeks to get a new phone line. Why? Because there's a process, there's a queue, and there's no competition, so what else will you do? Stuff like that is a crappy experience.
Yup, I'm in Ontario too. Fundamentally the issue is that electricity is an essential service, much of the demand is inelastic, and most of the costs are fixed. This is why you have embarrassing situations like having to raise rates to cover those fixed costs because everyone did too good a job of conserving [1].
But it's also why this kind of service is a good fit for a government monopoly. And if that means that some of the mostly-fixed-costs end up covered by the general tax base, that's fine with me: the general tax base is taken on a progressive model where the wealthy pay more into it, and there isn't really a good way to make the wealthy pay a different rate for power (yes, I'm on the upper end of middle class, and I absolutely deserve to pay more for these things than someone else who is just scraping by— not just more because I use more, but also more on a per-kWh basis).
Well if we talk about the phone market. There's lots of stories about people trying to cancel their phone contract in the German deregulated market and the companies just continuing to charge or not freeing up the line for the customer to change to a competitor. There is a famous case where a debt collector went into the the central office of Telekom (parent of t-mobile) and took a printer, because they were not paying back overcharged money.
Just to say that things aren't all rosy in deregulated phone land either.
Retailers charging wholesale rates did say "please switch now", as early as the weekend before the cold snap hit on Sunday evening. The issue was that few retailers were willing to take on those customers, because most didn't have the spare pre-purchased electricity supply to supply these new customers without buying more electricity futures - and futures were already spiking by this point.
> Or a better idea would have been to charge $X a day as insurance, that would cap the price per kWh to $X.
What mechanism incentivizes customers to pay for the insurance, though? It seems to me that people are going to buy the cheapest possible electric plan available during normal times, and just forget about black swan events altogether -- unless you find some useful way to force them to.
> Transmission companies are a natural monopoly so should be constrained from the free market.
They’re only a “natural monopoly” in so far as the government has disallowed competition by preventing development of new competing lines and limiting access to local poles. Doesn’t seem very natural.
Yeah... companies are just lining up to spend billions to build out redundant electric lines, only to be thwarted by the heavy hand of Texas energy regulators. </s>
You are deliberately ignoring the reality of it. It’s not “good” to do something when the opportunity cost you passed up is that X-hundred thousand preventable malaria deaths or waterborne parasite deaths occur.
It’s a luxury to blow $1 billion in donations to Cornell. That’s not humanitarian anything. That’s not charity. At best that’s gross negligence, at worst narcissistically relegating hundreds of thousands of people to preventable deaths.
We’re not talking about wasting a few thousand dollars on selfish consumption. This is egregiously wasting the better part of $8 billion. It’s gobsmacking, the scale of it.
One man's trash is another man's treasure. Otherwise we'd all be reading a website called Hacker Facts, not Hacker News.
These anecdotes provide societal context to the story. Why would Microsoft get the public to harden their product? Surely they have enough resources to do it themselves right?
Because many eyes make light work. Some people would obsess over trying to hack this OS, putting in far more effort than someone paid 9-5 to do it.
What is insurance for? To cover risk of something bad happening. The bigger the pool paying for it, the less impact to any one person to cover all the risk.
Now imagine that was scaled up to a whole country. That's New Zealand. Check out the Accident Compensation Corporation. All medical costs related to accidents are automatically covered!
But who pays the costs! Everyone, via levies. How much? $2000 on a $150K IT income.
But how do you control costs? Who is entitled? Who is at fault? Surprise! It's a no-fault accident insurance system that covers all accidents.
In exchange for that, we gave up our right to sue in accidents for medical damages. Why pay a lawyer when they're not required?
I guarantee the average US worker that makes 150k (not an avg salary) pays more then 2k in SSI taxes that cover Medicaid. They pay all over again for private healthcare, probably in the 6k range if they don't have kids.
Cardboard looks really well polished, well done!
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