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Comment by beaner | Hacker News Reader

One of the author's points seems to be decentralized technologies tend to have large points of centralization, so why does it matter that they're decentralized?

For me, the answer is the ability to opt out. When it comes to crypto currency specifically, it doesn't matter to me if 99% of users store their money on coinbase, as long as I individually have the ability to remove myself from the system.

The point isn't to force decentralization on everyone, it's to provide an opt-out ability to those who want it.

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This isn't really about Coinbase as an exchange. It has a bit more to do with 51% attacks by miners. They are either possible or they aren't, and either way is bad because you're screwed if your money gets stolen.

Might it be better to accept the risk of centralization and be able to dispute transactions? Preferably without the drama that happened with Etherium when they did that.

Another possibility is the Linux/DNS model where you have a central authorities who commit public transactions that are closely watched. Though this is only possible for things done in public.

> This isn't really about Coinbase as an exchange

It is though. The author's examples are about end-user consolidation on platforms that are built on the decentralized network, not the consolidation of the network itself.

You can opt out of baking with cash far easier than away from exchanges with crypto.

I don't know what you mean. Baking?

I think it was a typo for banking.

It's not possible to opt out of banking with cash and still be able to transfer cash over the Internet.

Getting out of exchanges is trivial. You transfer your money to an address you control. That's it, it isn't tough. Then you can use your money electronically, which is why it has different use cases than cash.

Yes, but cash has different properties than crypto. Some of those properties are better, some are worse. Depending on what you want to do, crypto may be more useful than cash.

There's no ability to opt out if Coinbase (for example) dominates all the other exchanges into nonexistence.

What if you create your own exchange? Eureka!

That's not how it works. They could be the only exchange anywhere, but they'd still only be one node in the network.

Exchanges greatly help the transition to crypto but they are not necessary for it's existence

What is value? Without an exchange, how do you secure it?

Exchanges facilitate liquidity between crypto and other common currencies. This has obvious value. But just like any currency, the value of a crypto is what you can get for it. So in the hypothetical where there are no exchanges, there would still be value in terms of the things you can buy with crypto directly.

I mean if I give you X BTC for Y products or services, no exchange need be involved.

This is the theory that has been expressed for years, but it is in practice still a fantasy. Somebody tried earlier this year to live on it for 36 hours; even in a major city it's not practical: https://www.nytimes.com/2018/04/16/nyregion/new-york-today-l...

Actually dark net markets work this way.

We need more developments and time to move away from the hodl mindset to where crypto can be seen as currency not an asset. How much time this will take? I'm not sure, after all we are talking about some very powerful and ingrained institutions involved.

USD has a 225 year head start...not surprised BTC hasn't hit that level of adoption yet. Credit cards took a few decades to hit mainstream too to the point where you could literally use them everywhere.

The point is not that you can't use Bitcoin everywhere dollars (or even credit cards) are accepted. The point is that it's useless as a day-to-day currency. As far as I can tell, the number of places that accept it is declining, so it will never catch up with anything.

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