At some point value and utility always converge.
A good heuristic to predict the value of something: would you get them if they were free of charge?
The only difficult thing is to predict when the convergence occurs.
The asymptotic value of Bitcoin is $0.
Yes. FOR NOW. But public decentralised blockchains have interesting properties (enabling ownership , Liquidity , composability) and lots of smart people are trying to use those properties to build interesting apps.
These apps are not there yet. I am optimistic that some good apps will be launched in next few years that make use of those unique properties enabled by decentralised public blockchains.
Your "ownership data" does not have any intrinsic value. It only has value because an external authority (your Government's justice institutions) is able to enforce it.
Writing something on a blockchain has no magical effect. You cannot remove necessary third-parties like that.
> Most corporations which currently store my data proved that they cannot be trusted and they only look after their shareholders. Not users.
True, but unrelated.
Example :- My education degree is something that I own. It can be very useful if I can quickly prove to the world that I indeed really have that degree. (like Twitter allows to prove you own an avatar NFT) . It would be super helpful if this was on a blockchain instead of some university database with a cumbersome process to avail transcripts.
I don't think you understood what I meant. I said it has no intrinsic value, meaning that it has no value in itself.
> My education degree is something that I own. It can be very useful if I can quickly prove to the world that I indeed really have that degree.
The fact that it is written in a blockchain that you have a degree has no value in itself, it only works if a necessary trusted third-party, the university where you got that degree, approves it. You are not in a decentralized and fully adversarial setting. You do not need (nor want, for efficiency purpose mainly) a blockchain to solve this problem.
What you want is a cryptographic certificate (just like an X.509 SSL/TLS certificate) of your diploma signed by your university, which would play the role of a Certificate Authority, and which you can trust because the government that accredited your university to deliver actual diplomas has a root certificate (it acts as a Trusted Certificate Authority) and has signed the one of your university with it.
> like Twitter allows to prove you own an avatar NFT
Twitter is a central authority and could very well associate any "NFT avatar" with any of its users without relying on any blockchain.
People will trust the institution – if a reporter calls them and they say “yes, they earned it” most people will not question it. If they say “never heard of them”, a record on a blockchain won’t help much because it disagrees with the canonical source and then you’ll be hearing about how that degree record was published in error or fraudulently, or that school is a diploma mill, etc.
Electronic records are nice but a 1970s public key signature works just as well at a fraction of the cost because ultimately it comes down to whether or not the reader trusts the issuer.
So as not to bury the lede, certificates of authority as to any legitimacy are a lot like Certificate Authorities; it's the Conway principle. They always want "revocation authority" and it's never "proved" unless they check it again this time... just for you!
I happen to still interact with people who are affiliated with the institution where I "stole" an education. I legitimately obtained certification for completing a course of study in numerical analysis; no cheating. A few years ago I don't know what they did but I strongly suspect a butt sniffing tool for alumni was introduced, because people started being like that.
Cutting to the end, a couple of years ago I ordered a transcript for $11, by regular post, paid with a check. I strongly suspect that now buttsniff shows something like "transcript available".
Why is it so difficult to find utility with this "tech"?
As long are you are not a criminal, ownership and liquidity are not huge pain, what is the real, tangible benefit of decentralized banking?
I am not convinced that monetary transactions should be above the Law, and for them to be lawful they have to be centrally regulated in some ways.
Capital formation for any common purpose without trusting 3rd parties. As an example -> there are some NFT vault DAOs where strangers pool together to purchase NFTs that are too costly. People Vote on proposals regarding which NFT to acquire and when.
The cryptocurrency is the only application that works because transactions are performative writings on the blockchain: they define truth. Once it is written on a blockchain that Alice has transferred X tokens to Bob, it instantly becomes a fact by definition, so you can trust what is written on the blockchain.
In any other application, what's written on the blockchain concerns stuff that are external to it. And what's written can thus only be valid if an external (and necessarily trusted, whether you want it or not) third-party can enforce or make what's written on the blockchain to be true. This means that any other application cannot actually exists in the decentralized and fully adversarial setting that would require the use of a blockchain: there is always another, more simple, more elegant, more efficient solution that can be built on top of the trust that must exists somewhere to make things work.
Also, a blockchain needs its cryptocurrency to actually work because there has to be an incentive to participate in the consensus mechanism whether it is PoW ou PoS or other variants, and the incentive cannot be external to the blockchain otherwise you need to trust the third-party which controls it.
Blockchains and cryptocurrencies are basically the solution to their own problem, and to nothing else.
There are bound to be other possible applications. Writing off an entire new tech because you can't think of them is just narrow minded and silly.
Escrow needs a third party. It destroys all your Blockchain advantage.
https://academy.particl.io/en/latest/in-depth/indepth_escrow...
Who proofs that the smart contract is fulfilled?
Or let's asked different: how does a smart contract solves the trust issue from items not on the Blockchain?
So in your example you can sell an ice cream for £10. When I buy it for that I pay £20 and you pay £10 and send the item. I eat it and we're both £20 down. So I want my £10 back and click a button. It then releases £20 back to you - the item price and your collateral, and my £10 collateral back to me.
I always thought that this part of a smart contract is ridiculous as it binds the same amount of capital as the transaction is worth on both sides.
It also doesn't fix the issue if someone with much more money than you wants to f** you over.
It also does assume you would find a good solution together just because of the capital invested but you know there are plenty of people who are not able to negotiate proper.
It just doesn't solve the issue and it doesn't solve issues like if the shipment is lost on sea. Or it's getting stolen.
A independent 3th party actually helps solving those issues.
The amount of collateral is configurable by sellers, and since buyers will soon be able to message sellers that means it's negotiable.
Normal companies with plenty of transactions per day don't have the motivation or money to put that much additional capital into the system.
Of course for a few transactions per month no one cares but I assume the goal is bigger than just a few transactions.
Sure, plenty of the mentioned items can run more efficiently on a centralized database but the question then becomes, “whose centralized database?” Blockchain is the only solution that provides credibly neutral and publicly interoperable accounting of digital assets, which could one day be 50% of the world economy.
> First, the entire financial system can and will be made digital
It already is.
> making every dollar you deal with every day a digital asset that can falls under blockchain
That is a very bold statement.
> Then, you have all online goods: (…)
Those all suffer from the exact same problem than physical assets, they exist and have a purpose outside the blockchain. You already have the oracle problem.
> credibly neutral and publicly interoperable accounting
This is again a very bold statement and facts disagree with you. Blockchains are not interoperable with one another and cannot be, for starters.
> which could one day be 50% of the world economy
This is pure wishful speculation on your part and is based on absolutely nothing.
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EDIT: I found "TAM"'s expansion: total addressable market.
Likewise, in-game items and other digital assets can exist in or outside of a blockchain. They can serve their original purpose when on-chain as well. I can expand on my point about interoperability:
Blockchains are not typically natively interoperable between them (exception might be rollups), but all assets on a blockchain are. If I create a video game and tokenize my items + currency, I suddenly open up a world of possibilities for users and developers to expand on whatever in-game functionality I can make with my limited team, like:
- Making items tradable on DEXs - Borrowing and lending services - New UIs and tracking tools - Clubs and clans that verify ownership - Derivatives and staking
In a world with tokenized assets, I could easily make a deal with a guy on the internet to let him stay in my decentraland property for 3 weeks in exchange for a ticket to a digital Marshmello concert - completely trustlessly and transactionally.