In 2022, Web3 went just great
newsletter.mollywhite.net
newsletter.mollywhite.net
It feels like telling someone about to jump into the shallow end of a swimming pool from a balcony that they are going to really hurt themselves and that the 2 feet of shallow water is not deep enough to buffer the fall, and them telling me I just don't understand and they use a new measuring system and the pool depth is in feet which is a made up measurement too so their measurement is just as valid and they can make it any depth they want to because they believe it and everyone else around does too.
Then they jump feet first and break their legs. A friend behind them says it is their own fault for going in feet first and dives head first and breaks his neck. Another friend says 'bad luck, but you know how many people break their neck walking to swimming pools measured in feet?' and jumps sideways and breaks his collarbone.
At that point 'welp, I tried'.
I spent two weeks digging through boxes and imaging hard drives before miraculously finding my wallet.dat from 2011 that I luckily hadn’t encrypted or even passworded lol.
Had 3.25btc in it (I remembered the .25. The extra 3 were a shock.). I ended up paying for my home down payment with it.
You shoulda seen my broker’s face when I showed up with almost entirely crypto to fund the mortgage. It took them several weeks to find a company who would be OK with crypto being fronted. I ended up having to come up with a way to prove it was mine which was fun. Had to back track through the blockchain tracking the history of the transactions, wallet address creation. Show I had the private keys etc. they finally accepted it as after a month of back and forth.
Then I didn’t cash out entirely when it spiked to $60k and now I am regretting that lol.
That rigamarole could have been easily avoid by converting the crypto to cash, which is trivial to prove is yours.
Did they end up accepting the crypto directly, or as cash?
Edit: thanks for the clarification, I didn't realize the issue wasn't with possession so much as provenance.
I guess I should have clarified: I didn’t directly give them crypto. I was using it to cash out and pay cash with. But I had to prove ownership.
Also I didn’t have the luxury of waiting.
In US law this is a taxable event.
In the world of stock, we don't like multiple expansion as it's a sign that prices go up on grounds that are hard to reason about. Things going up without reason tend to come down for the same reasons.
Crypto has _zero_ growth. Crypto companies, however, that's a different story.
But sure, I'm sure you'll be right about what you perceive to be growth. There are still millions of gullible and half smart people waiting to get on board.
Are you familiar with the term Deflationary Asset?
Because buyers are valuing them more and more and not just in words but by actually with their money?
> Are you familiar with the term Deflationary Asset?
Yes. I also believe BTC will outperform gold over the next 10 years (both of those are deflationary assets).
Where is the growth?
Or, you get more USD for your BTC.
> Where is the growth?
In the amount of USD one can purchase with their bitcoins? Literally, that's what this whole subthread is about where someone used their long held bitcoin to do a downpayment. The growth in USD price of a bitcoin is what helped them do that.
I think people perceive that the opportunity to have a comfortable life doing a “regular job” is slipping away in favor of an upper middle class of professionals who enjoy stability, and an enlarged sub-middle class who are finding the traditional trappings of middle class stability hard to come by.
This widening class gap leaves many realizing that lifestyle improvements will require a significant step change, not just a bit more effort. So we see people gambling. Someone might be working hard and saving all they can and still only have $5k in savings. They look at the price of houses doubling and realize they’d need to save for another 50 years at this rate just for a down payment, so they say fuck it and buy some call options and NFTs instead.
The crypto schemes are very often rehashing of old scams and mistakes, they are not qualitatively different from penny stocks pump and dumps, pyramids and MLM schemes, ponzi schemes, tulip/cabbage patch/whatever mania, etc.
GP post is suggesting that demand for this kind of speculation was up, and if that's the case, many of these people in the "market" for scams and gambling might have been more attracted to crypto because it still had some veneer of safety/legitimacy about it.
Nobody could plausibly claim that now that the failures are finally coming to light, of course.
Edit: I would suggest this is largely a failure of the media, which had long treated crypto as legitimate by default despite having the resources to pay real experts to actually cover it critically. Of course, even had traditional media outlets been sounding the alarm, who knows if it would have mattered much - faith in media is very low right now (exactly because they so often get this sort of thing wrong).
This time, as the FTX mess shows, the blame is on """regulators""" and """sophisticated""" investors completely failing to do their job.
I cannot remember where I read it but the gist essentially was that you are either mastering the software or the software is mastering you. It jives with what you are saying.
The best non-regulatory fix I can think of would be socially enforcing that people stop profitting from convincing others into doing bad decision making.
It's not very easy though, since fraudsters only need to convince people once to make off with their profits, unlike a tradesman or manufacturer who needs to stay in business long-term.
It's not obvious to me that the currently popular web3/crypto approach of widely promoting these risky gambles gets us there.
This is, to some degree, true - Quant traders in finance work with data that is literally unavailable to regular traders or amateurs but when it comes to crypto sophisticated quants and Joe Bogsly are operating on a level playing field when it comes to access.
Additionally, countries that are not the United States have chronic bank instability problems that make the current crypto collapse look like a joke. Large percentages of bitcoin transactions are conducted in Vietnam.
When a new cool thing is happening, the next step to maturity and adoption is gift.
How many rent a bike startups have you seen in your city?
Same deal, not a terrible idea, pretty cool, people flock in but there will very likely only be one to three of those companies left standing.
Pretty sure Tether isn’t operating on a level field with Joe Schmoe.
Every time Tether has disclosed anything, it’s been caught lying [1]. That anyone thinks Tether has anything close to standard financial disclosure, or is anything but a fraud, is a testament to the ongoing problem of mainstream American financial illiteracy.
[1] https://ag.ny.gov/press-release/2021/attorney-general-james-...
I did not say that these are "standard financial disclosures". I said that they were forced by the courts to reveal all this documentation and that so far, Tether has for the most part maintained its peg.
This should indicate to you that everyone from Wall St to Main St thinks that Tether is doing things "well enough".
Tether has issued multiple audit reports by independent accountants, and sure- they may be suspect but the way in which they are suspect is the same way every other company's financial are suspect - which, last I checked, didn't stop Lehman Bros.
I don't think we're living in a particularly unique time this way. The book Extraordinary Popular Delusions and the Madness of Crowds was written in 1841 and was already then packed full of stories not dissimilar to the current crypto bubble.
I don't mean to sound defeatist, though. We could do more to financially educate people in general, which would provide a better defense against such manias.
It feels worth noting that this book, as well as the wider idea of an abstract idea of crowd-induced mania in general it reinforces, is pseudoscientific with little credible evidence to support it.
It's origins lie much more in the political motivations and historical context of the authors: It is no coincidence that this book was written by a wealthy scotsman against the backdrop of the idea was first floated by an aristocrat during the upheavals and riots surrounding the introduction of capitalism, and that the idea was initially proposed by an aristocrat during the french revolution. They were both times where it was extraordinarily convenient to be able to dismiss engaging with the things the crowd was being driven by.
I'd urge against making the same mistake today. To me, it is impossible to separate the web3 mania from the historical context it happened in: Like 2008, it is a time of job insecurity, financial anxiety and distrust in systems with governments doing little to help. They are prime times for wishful thinking and people who want to take advantage of it.
Doesn't take much to spot the bullshit in: "Risk-free 7% APY in a time when every single noteworthy financial institution is offering less than 0.5%!"
Unsurprisingly, most of those schemes have since collapsed.
I’m still sort of sad the focus hasn’t been on decent remittance systems, the true useful tool of crypto IMO.
One notable example of such a scheme was OneCoin (https://en.wikipedia.org/wiki/OneCoin), which wasn't even based on a blockchain.
New clothes on an age old story.
Day trading and crypto and freemium games fleece people digitally. It's all ephemeral. What holds people back?
It pains me to buy a lottery ticket, so I've never been tempted by these scams. But I imagine having everything online hacks player's inhibitors. eg I've read rants about how Robinhood and the like weaponize "dark patterns" to loot their players.
I must say though that I don't and didn't own any crypto assets, and am not really well-versed in the web3.0 world, which might be why I am confused by your comment.
Even a dollar would have lost use ~20% loss over the past few years just sitting in a bank. The best place to store wealth is in assets not currency. People who stored their wealth in crypto are as silly as people who put savings in a bank except with more volatility like this. Crypto isn't a fad that has gone away, there is still demand for it except now all the exchange crashes will introduce regulation that will make it a safer bet than before. Trial by fire and all I guess.
You shouldn't bet or risk money either in stocks or crypto that you aren't prepared to lose. That's like the first-ish rule of investment isn't it?
There are also people who fly airplanes and cliff dive, but if my acquaintance Joe the whitecollar sales associate who lives two houses down from me starts telling me he is going to go solo flying or cliff diving for the first time with no experience, I will warn him off it in no uncertain terms.
As well, if he is talking about how much he is making on the side doing options trading, do you think I wouldn't tell him that it is a bad idea and he is going to end up most likely losing a great deal of money?
People who make these comparisons like you have are acting as if crypto is being marketed to wall street and not people like Joe.
You seem to have overlooked my statement about rule #1 it has to be money you can afford to lose and of course people will tell you the risk is tol high, you have to learn the hard way if you think you know better.
Did I know people who made out well playing the crypto market? One. Did I tell him to not do it? Nope, because he knows what he is doing.
The flipside of this is the 5 or so people in my direct personal sphere and hundreds if not thousands (if you count the lurkers who followed conversations I was having with individuals) online who have advocated for or expressed direct involvement or interesting in playing in crypto markets that I have advised against doing so, with a rare few heeding my warning but the overwhelming majority using circular logic, fallacies, personal attacks, and 'not-even-wrong' economic theories to justify putting a large portion of their income (sometimes even taking out loans) on it.
Please understand that the perspective I am trying to show the readers of my comments is my own.
Not everyone that lost money did this to you though, seems unfair to judge most people who are just trying to get by because of a few assholes on the internet
With every crypto hype cycle, I actually go through the motions and create a smart contract project and become completely disillusioned with the hype. I thought ERC20 tokens were bullshit when I realized it's just updating keys in a hashtable.
I worked in Solana and was surprised to find out that a developer can update a program at will. No one is really talking about this and this seems like a disastrously shaky foundation to put your money in, along with programs being difficult to audit.
There are some NFTs by amazing artists which no one cares about. The ones with the most popularity are modern-day clip art pieces, with copy-paste scripts and marketing strategies.
I think web3/crypto will have mass adoption, but when it does, it will be much more boring and seamless with what we have today, with large companies managing blockchains and governments issuing their own coins.
But, that's no different from a really power-inefficient database. Whatever could be done with centralized crypto can equally be done with a Postgres server for 1/100,000 the cost. Why do you think this will have mass adoption?
What point is there in the blockchain here? Why would a company or government need or want the indirection and overhead of blockchain/cryptocurrency instead of a normal database and traditional currency?
You can have a central authority operate on a ledger as they please, but provide verifiable proof that they are not rigging the books behind your back and rewriting history
... in which case they could just create a standard centralised system and avoid all the overhead of blockchain - or am I missing something here?
I don't see the point in mining coins when you could simply run a for loop generating uuids followed by perhaps signing transactions with public key cryptography.
I feel like we'll look back at "web3" as a wild west of cryptomania.
Perhaps we all need to start thinking along the lines of "Generation GPT" - this seems to be the next evolution of the Web if you ask me.
Art doesn't need blockchain to be sold, and an NFT adds zero value to it.
I've only witnessed almost every amazing digital artist on my twitter feed quickly devolve into an obnoxious NFT shill and drastically reduce the quality of their practice to maximize their output.
I'm glad they are finding ways to some meager financial gains but the ideological mystique around their practice was shattered in the process
Because it's not a real blockchain. Most chains are centralized. You should really focus your time on Ethereum. It's the only chain researching and innovating and is focused on longevity.
So much of the cryptocurrency world is based on terribly inflated prices and it has always been unclear to me how much money was actually put in by real people who aren't just self-dealing and wash trading.
I am sure the answer is in the billions but I'll bet that it is much lower than some people would have you believe. Luckily crypto is still fairly well firewalled from the economy at large.
Unfortunately I suspect much of the real money came from uninformed non-rich people who believed the hype - and not just the ‘massive gainz!’ hype (maybe they even saw that for what it was), but the general excitement in that media over crypto in general.
He didn't pay for the first tweet, he paid for someone to create a hash of the URL of the first tweet. The distinction matters: the NFT scam works by tricking people into thinking they own the thing, instead of just a copy of a pointer someone made to the thing, which is what they actually "own."
99.9% of people don't care about the technicalities of how NFT's work, they buy them because they are valuable to them and everyone else believes they are valuable.
Every single digital item anyone has ever bought, from Ebooks, to in-game items, to movies, is just a pointer to some bytes on a disk.
When you buy an e-book you don't pay for "proof of ownership" like with an NFT. When you buy an e-book you get an actual file containing the data of the book. With this file you can read the book. With "proof of ownership" you can do exactly nothing.
"Web3 represents a fundamental evolution of the internet built upon blockchain architectures. Moving from centralized control and capitalization to a decentralized network where the capital is distributed between the operators and consumers."
I feel like the definition of Web3 is hijacked by pundits. Probably because it has become yet another buzzword and being so tightly associated with Crypto maybe has it tainted forever?
The difference between the two isn't necessarily technical; rather it's the requirement that you "join the crypto economy" and start buying up whatever shitcoin -- or CDS-style derivative of multiple coins -- is being used for that one website...and somehow that means "SSO is easy now!" and "anyone can make micropayments anywhere!" etc., etc.
The latter only makes sense in a world of free money from VCs that lets people spend tens of millions of dollars building a *login form* that they charge other websites to use. Their business model seemingly ignores the fact that no serious enterprise[^1] is going to run their internal authN/Z and IdM on a global blockchain.
[^1]: actually, I'm sure several companies have/will tried this, and equally certain the net result was a flaky service that was effectively just querying a Postgres table that cached the on-chain identity for a user and checking their presented token against that. I.e., yet another Postgres instance masquerading as "web3 infrastructure".
The truth is: you don't need crypto stuff to have a decentralized internet, as ActivityPub is handsomely showing and, let's be real here, the web itself is showing for the last decades.
I'm still to see a Web3 business that doesn't smell, looks, and behaves like it's a grift.
Blockstacks was initially release with "decentralized" storage that allows me to interact with dapps that would use that storage to hold my data. To me that was and still is the pattern of what I consider "web3".
It's extremely useful to have a term like "Web3" to use as a unifying force within such an effort, as well as a way to describe it to people outside, and I don't see a better one for such a decentralization right now.
Hahaha, wow. You couldn't even take a 2.899 million dollar write off loss on your taxes too! Just straight vaporizing nearly 3 million bucks.
So if you lose $3M in one year and happen to have $3M in other capital gains then hooray - they offset and you pay no taxes on them. But if you lose $3M in one year and made $300k in income, you are still paying income tax on everything minus $3,000.
You get to keep carrying it over so you can apply $3,000 every year - but if you've got losses in the millions they'll never be exhausted in this manner.
If it was a movie, I'd think the plot is just too stupid: a dictatorship funded their nuclear missile program by hacking an angry-birds-styled JRPG game.
An yet here were are. This demonstrates that playing with cryptocurrencies is dangerous, even seemingly benign or useless applications.
Seems mostly plausible to me, though of course a bit simplistic, and occasionally wrong, when more traditional institutions and funds pile in and their losses create more systemic issues. Thankfully, they seem to be mostly over crypto for a while now--at least, that's my read?
Once the larger crypto assets lose value, the liquid (crypto) the stable coins hold in cold wallets will of course devalue. The only liquid they hold of value will be traditional hard to liquidate assets, which will simple be used to pay off the big players in the bankruptcy.
Expect this entire thing to collapse pretty quickly when it gets going. We are yet to see real contagion in this space. A lot of people will be left holding worthless coins like every crypto coin bankruptcy so far.
That said, traditional money is no good to you either. Thanks to fractional reserve banking [1] no currency actually has any value any more. It's difficult to suggest where to suggest to invest, but I don't want to get caught holding monopoly money once the game ends [2].
[1] https://en.wikipedia.org//wiki/Fractional-reserve_banking
From the article:
""" $4.27 billion was stolen in various hacks and scams this year alone, although that is a very conservative estimate ... """
One source claims $5 trillion lost during the dot-com crash as of 2002 [1].
I believe being critical of new technology and holding scammers accountable is great but I want more critical analysis of what's going on, not just a snarky middle finger against cryptocurrency and it's surrounding technology.
[0] https://en.wikipedia.org/wiki/Fucked_Company
[1] https://corporatefinanceinstitute.com/resources/equities/dot...
There has been no real value, product, or worth created here. With the rise of public internet spaces in the 1990s, online shopping, web search, and more - the value was immediate and apparent. Of course there were bad ideas, scams, etc, but the major difference between that and crypto is that Web3 crypto is 100% bull. There is no value here. I have yet to see a single worthwhile crypto product out there, anywhere.
Do you know why? Because the decentralization it offers is a mix of a myth and meaningless - in cases where you can get it, you don't need it. Everywhere else, its actually just a different centralization.
Oh and the protocol is just giant inefficient linked list, poorly distributed.
Startups were laughed at when they said you would buy pet food online [3] or pay your parking tickets online [4]. Both are so commonplace now as to barely be worth mentioning.
You absolutely could be right. Maybe cryptocurrency and the surrounding technology is a fad or hype without any substance but you're making an assumption that the rollout of cryptocurrency adoption should follow the same schedule as dot.com startups. For a point of reference, Linux was created circa 1991 [5] with the GNU project started in 1983, giving about a decade or two, depending on where you start, from "widespread" Linux/FOSS adoption.
You're stating that "there has been no real value, produce, or worth created here" bluntly without really backing it up. There are plenty of products and use cases, just none that you would consider valid. People use cryptocurrency to purchase goods and services, just not the ones you might find valid. People use cryptocurrency to support organizations they favor, just not organizations you might favor. People are using cryptocurrency to explore different social media models, just not models you would find valid.
My plea is in line with the HN terms of service. Please have curious conversation. Molly White has valid things to say and, as far as I can tell, does research the claims she makes. I don't like the tenor so I feel like I need to push back here and elsewhere to put things in context.
Your casual, snarky, dismissiveness doesn't add a lot to the conversation. Would it add anything to the conversation if I said "XML is a poorly designed LaTeX, improperly implemented"? Or "Javascript is a poor attempt at a Lisp implementation"? "Twitter is public text messaging, just done poorly"? The reductions gloss over the complexities of the ecosystem and utility. It should be a red flag that there may be something you don't understand if you're so quick to cite idiocy.
To your points:
Decentralization means different things to different people. In the context of Bitcoin, or many other cryptocurrencies, it means that anyone can participate given the resources, without the need to apply for credentials. Miners can join and participate in the network by standing up hardware. Contrast this with starting a business, pushing an app on the apple store, publishing a game on steam, etc. Note that this is how the internet was also designed. Anyone wanting to participate in the network ostensibly could.
I think to dismiss Bitcoin as an "inefficient linked list, poorly distributed" is to dismiss a lot of good ideas and research ideas. Bitcoin may have some flaws, maybe critically so, but it sits at the middle of theoretical computer science, economics and finance in a novel way that responds to a lot of shortcomings of attempts before it.
[0] https://en.wikipedia.org/wiki/Trojan_Room_coffee_pot
[1] https://en.wikipedia.org/wiki/Jennifer_Ringley
[2] https://www.youtube.com/watch?v=95-yZ-31j9A
[3] https://en.wikipedia.org/wiki/Pets.com#Legacy
https://i.redd.it/tcwp3xnsewo21.jpg
Back then, it was stuff like AOL that was considered the established and proper networking service, and the web was just a circus of trolls and buffoons.
Also didn't Twitch start off as a site to view a webcam attached to some guy's head 24/7. I also remember a website where you could buy a pixel for a dollar, and the entire website consisted of 1 million pixels.
I'm not saying that cryptocurrency will amount to anything, I'm mostly saying that no one here knows. HN has a kind of reputation for being incredibly dismissive of technology and missing the boat on a lot of things, failing to recognize the big picture, and to be fair it's not even an HN thing; most people fail to see the big picture.
Afterall, who the heck needs Dropbox? Just trivially setup an FTP server mounting it locally with curlftpfs and then use SVN on the mounted file system. Right guys?
The problem here is that the creator of Bitcoin was following a philosophical motivation, not a scientific one. The 'economics' behind it are completely misguided and appear to be based on the notion that taking power away from powerful entities and distributing amongst individuals will remove the problems associated with capitalist systems. It does not consider that people created these entities and removing power from systems that rely on it creates power vacuums which society abhors. Things just end up getting to the same place a different way, but redoing all of the bad outcomes that had to be painfully learned and many times almost led to humanity scrapping capitalism and free markets altogether because of the damage done.
When you approach problems thinking you have the answer before you start looking for the solution, then you get things like Soviet Russia and you get things like eugenics and you get things like Bitcoin.
I am sorry but by saying 'it has critical flaws' and then also claiming that it it is some work of science and can be used for progress in economics and technology and finance, you neglect totally that it's first and most critical flaw is that it is the product of a dogma which is completely removed from reality in two of those areas.
This sentence is also weird:
> The 'economics' behind it are completely misguided and appear to be based on the notion that taking power away from powerful entities and distributing amongst individuals will remove the problems associated with capitalist systems.
So you're arguing that consolidating power by removing it from the masses is a better alternative? It's not that distributing power solves problems, it's that distributing power is a necessary precursor to solving problems. You apparently disagree with that premise?
I said that it may have critical flaws not that it does. I'm trying to communicate uncertainty. I believe Bitcoin has a solid foundation but I could be wrong so I'm trying to leave room open for debate and to be open to new information that could prove me wrong. Bitcoin is also an evolving story, with usability issues and scaling issues that complicate discussions.
The fact that dogma is associated with it is kind of irrelevant. I guess you focus on it so much because it's dogma you disagree with? GNU is steeped in dogma. The US constitution is steeped in dogma. The mere fact that dogma is present is not the sole indicator of validity of an idea.
Bitcoin was a specific and evolutionary response to what was perceived as a failing system. Your statements get pretty hyperbolic. I'm not sure it's relevant, helpful or valid to compare Bitcoin to eugenics or atrocities committed by Russia on it's citizenship.
You misunderstand. If I develop a technology because I want society to be able survive a nuclear attack by making a robust network that has extra effects like enabling instant communication between disparate entities, that is a benefit. If I develop a technology that replaces in-place infrastructure like school buildings with nuclear-proof bomb shelters at great cost and by removing the schools and making children homeschool because I think that any ill-effects caused by disrupting society are worth it in order to safeguard humanity from a nuclear attack that I believe is coming -- well that all depends on whether I am right about my founding belief, isn't it? If there is no nuclear attack and we lose critical infrastructure because I had a political, unprovable belief, then we seriously messed up.
I think you know that what the difference is between ancillary benefits because of planning and destructive effects because 'the ends justify the means' especially when the 'ends' ever happening are highly disputed and the 'means' haven't even been proven to work in any sense at all to produce them.
> So you're arguing that consolidating power by removing it from the masses is a better alternative? It's not that distributing power solves problems, it's that distributing power is a necessary precursor to solving problems. You apparently disagree with that premise?
You are better than this. Please don't disrespect your position by relying on loaded questions and strawmen.
What I am arguing for is not disrupting existing power structures that society relies on because you think it would be better off without them and that they are unfair. Especially when your replacement is unproven and it seems reasonable and sounds good on paper until you play it through logically and see that it ignores basic tenets of established processes of modern societies -- like we need to be able for a world-wide payment system to be able to scale and not destroy the planet and eat up a large portion of our energy resources if and when it is trying to do so.
> I said that it may have critical flaws not that it does.
I misread you then, but that is probably because I contend that it does.
> I believe Bitcoin has a solid foundation
You have every right to believe that, and I have every right to tell you that you are wrong and that the debate is only between people who want Bitcoin to be a solution to something it cannot do (fix inequality or really anything that it is advocated for), people who want to use Bitcoin to redistribute wealth to themselves and their friends, and people who want the former group to snap out of it and use their effort to work on productive solutions and for the latter group to be investigated for crimes and if found guilty sent to prison.
> The fact that dogma is associated with it is kind of irrelevant.
Not when you come to terms with the fact that looking for evidence for something you already believe and discarding that which does not fit is something that is extremely harmful to society and prevented and reverted progress for unknown generations of people as evidenced by the dark ages in Europe and the regression of the middle East from world leaders in sciences and technology to war-torn wastelands.
> Bitcoin was a specific and evolutionary response
Evolution does not mean better -- it means more effective. Capitalism is about distributing resources from the ground to production to consumption and conversion into capital. Moving capital from people with little power to people with more power is actually more efficient when you remove regulations and societal prohibitions on deception, fraud, and usury. Bitcoin is great at that.
> You misunderstand.
No, I didn't. I understood and got at the core of the argument. You've responded to it with the argument you actually wanted to make, not the one you did make in the parent response.
So your argument now is not that it's dogmatic but that the implementation and rollout is/would be too disruptive.
I disagree. I think we're seeing people have mixed fiat currency and cryptocurrency and it seems clear that cryptocurrency can further integrate itself into everyday operations without causing the disruption you're thinking of.
> ... like we need to be able for a world-wide payment system to be able to scale and not destroy the planet and eat up a large portion of our energy resources if and when it is trying to do so.
These are all things that Bitcoin possibly can mitigate and work around. I'm willing to admit that this might not be possible. You refuse to engage in the idea.
> ... looking for evidence for something you already believe and discarding that which does not fit is something that is extremely harmful to society ...
Again, my argument is to have a reasoned critique, not a shouting match. Critique is important. Bullying doesn't help.
I am aware of the shortcomings. I don't want to ignore the problems but I also don't want to let let them overshadow the benefits, especially if the benefits outweigh the problems. I urge you to do the same.
> Evolution does not mean better ...
This was a response to your earlier point that Bitcoin was created from dogma. There might be bias in terms of which economic or political model is best (by Satoshi Nakamoto and other proponents) but my point was that Bitcoin was a logical progression of ideas to fix critical flaws in earlier attempts.
The commonly held political definition of Capitalism is "A socio-economic system based on private ownership of resources or capital." You're describing what you believe to be the effects of capitalism. Maybe that implies what you're talking about but that's not obvious to me and I suspect it's far from the truth. Shooting from the hip, I can already tell you that things like solar energy exist which are in the other direction of where you're pointing to for resources.
Moving capital from people with little power to people continuing to consolidate power is progressing just fine without cryptocurrency [1]. Though I'm not sure if the sources can be trusted or that the interpretation is correct, there's at least some evidence that cryptocurrency is being used for one of its intended, altruistic, use cases [2] [3] [4].
[0] https://en.wiktionary.org/wiki/capitalism
[1] https://www.pewresearch.org/social-trends/2020/01/09/trends-...
[2] https://ripple.com/insights/broadening-financial-inclusion-i...
[3] https://cointelegraph.com/news/africa-s-crypto-market-has-gr...
[4] https://blog.chainalysis.com/reports/africas-grassroots-cryp...
Let's get this out of the way right now:
I did not accuse you of anything -- I pointed out that you were using a loaded question and strawman and that you shouldn't do that. You are now suggesting, with no evidence, that I am acting deceptively. I have done nothing but share my opinion based on my own knowledge and experiences and have done so in direct response to you, quoting when appropriate, without pivoting, without moving goalposts, without using logical fallacies, and without accusations. I ask that you do the same going forward. If you dislike or disagree with something I write or I have made an error in rhetoric please point it out, but if not I would appreciate civility. Thank you.
Moving on...
> I understood and got at the core of the argument. You've responded to it with the argument you actually wanted to make, not the one you did make in the parent response.
I'd rather not that I rehash the same things but respond to you specifically. By bringing counterpoints you force me to revisit my thinking and clarify and expand -- this is a good thing and this is what discussions are good for. I hope you aren't suggesting that we sit here and yell the same unchanging talking points at each other ad-nauseum. I am honestly confused by your response here -- if you got my point the first time I said it then you wouldn't have responded to a misunderstanding of it. If you think you understand that what I meant by a philosophically motivated product was anything like a solution oriented product then I have not explained it properly and I would ask that you try and parse it so that we can be on common ground and not talk past each other.
A philosophically motived product such as Communism has as its goal a politically driven end-point. It seeks to get there by whatever means are available and sees the end-point as the mark of success and treats things like human suffering on the way there as irrelevant or collateral damage or justice. Another example would be 'apocalypse fetishism' (with or without a religious basis)
A solution motivated product like medicine or the writing of the constitution seeks to to solve problems by working through them, proceeding in a fashion that seems reasonable, and moving forward or in other directions based on the results as the happen. Sometimes these products are ineffective, or they were the result of external forces, but the people at the heart of them were working towards progress and a goal (freedom, health) and would change their methods when news ones proved better, or they realized it was not productive or what have you.
I contend that Bitcoin is essentially a philosophically motivated product and has as its end-point a 'libertarian' society based on economics averse to central banking.
The fact that you can point out faults in some of these things does not change the fact that they are fundamentally different ways of approaching things. That is what I was trying to convey. If you still think there is no difference then I will either have to think of a better way to explain it or I will have to concede to the fact that I am either terrible at communicating something that seems basic to me, or that you are unable to understand it for some reason, but I neither of those things is true.
> I disagree. I think we're seeing people have mixed fiat currency and cryptocurrency and it seems clear that cryptocurrency can further integrate itself into everyday operations without causing the disruption you're thinking of.
I don't see any of the use cases for it happening at all. It may be that I live in the USA and am privileged, but no one I know who interacts with crypto sees any problems which can be solved better by it, except for novelty or speculation. The only cryptocurrency which is good at legitimately solving a problem well is Monero, because it is good at being a means of transaction for illicit goods online for which there is a good privacy wall in place.
> These are all things that Bitcoin possibly can mitigate and work around. I'm willing to admit that this might not be possible. You refuse to engage in the idea.
There is a difference between refusing to engage in an idea and having already spent time engaged in that idea and realizing that the idea is a bad one. I have done the latter.
> Again, my argument is to have a reasoned critique, not a shouting match. Critique is important. Bullying doesn't help.
There is no way to illustrate what can only be described as a technology which has as its stated goal the changing of society but to mention times in the past when this has happened to ill effect. I do not see it as hyperbolic at all. If you wanted to talk about a political philosophy advocating the training of dogs or something, then I wouldn't bring up Soviet Russia as a response. But since Bitcoin wants to break down central banking, for which our world economies are reliant, then Soviet Russia seems apt.
> Capitalism
I don't want to get into a 'the definition of...is' type debate, can we accept I was being a bit reductive but that you understood my general point, and skip the back-and-forth about it that we both know is pointless?
A huge part of the FTX/Alameda fraud involved minting their own utility token (FTT), artificially inflating the price, and then using it as collateral for further loans.
How is that not a crypto failure? Unless you only define "crypto failure" as "smart contract got hacked", in which case we'll have to agree to disagree.
Frankly, I think folks in the crypto community trying to spin FTX as "not crypto" are simply engaged in goalpost shifting.
The fact that it's not related should tell you something. Cryptocurrency is designed to solve exactly the problems FTX had. It is designed to enable trustless finance. Why didn't cryptocurrency prevent that problem?
Because FTX wasn't using cryptocurrency, because cryptocurrency is unworkable.
But also we should remember that pretty much every bank in the US would have FTXed it's customers money in 2008 if the government hadn't bailed them out.
This is something that keeps coming up: the regulations and institutions in traditional finance exist largely because it already went through the same pain that crypto finance ia going through now.
The government forced the banks to take money so people couldn’t tell which ones were in real trouble and which ones were fine.
Blind faith in an economic theory against all empirical evidence is a dead end.
There absolutely are decentralised exchanges, working extremely well and safe ways to keep your cryptocurrency. I use them. It's very odd to come on here and find people claiming that my experience of cryptocurrency is impossible.
But they didn't. Instead, FTX used crypto as a means to transfer funds into their own, centralized custody. Not much different from a bank wire.
This isn't a "communism would work perfectly" style argument at all. I'm really not sure of what you're getting at, or if you understand how crypto works beyond surface level articles.
Second, if these defi systems exist, why are so many still keeping their money on exchanges like FTX/Binance/Coinbase/etc without such protections? I suspect it has to do with convenience or maybe cost - smart contracts require "gas" to run, no?
But even if exchanges were the only way, that trust time is quite minimized, compared to the status quo.
To your second point, I agree it has to do with convenience. IMO the main reason is crypto UX is still very bad. The space is going to need some major new hardware and software solutions before going anywhere near mainstream.
These defi systems do indeed exist and are used by quite a few people (including occasionally me). 'Why are so many still keeping their money on [centralised] exchanges', is a question that a lot of people in the cryptocurrency ecosystem ask themselves despairingly. While UX could be better, it's really not that bad - the real answer is that the vast majority of people investing are 'number go up' investors, used to the stockmarket and regulated brokers, rather than people who actually care about the core ideas of decentralisation, programmable money, etc.
It's actually pretty easy, and a fair few people do. Uniswap v3 currently has a 24h trading volume of $317,196,156, and the app is trivial to use. Curve's app is ugly but not hard to use, and has a 24h trading volume of $199,693,574. Maybe you think those numbers aren't all that impressive, and sure, I'd like the decentralised trading venues to be doing more, but it's a far cry from 'nobody'.
There's only the relatively small (!) $370M hack
> I've erred on the side of not including in the grift counter/leaderboard $ amounts for collapses where the actual loss is still pretty unknown (ex. Terra collapse, FTX)
> This is confusing, so I'm deciding whether to start including them or just add an explanatory note. Thoughts?
The same money can even be stolen multiple times in the same hack, if it is deposited with some exchange, who then loans it out to someone who desposists it with the exchange again. If the exchange is hacked, it's the same original dollar being double-stolen.
There are rumours that some money on exchanges might be being counted hundreds or thousands of times...
Very very very few people have the ability and wherewithal to hack a smart contract or bridge, they are extremely convoluted, ugly and difficult to understand.
It's directly attached to money; it's technically convoluted, ugly, and difficult to understand also for the people programming them; once you steal it, it's yours; the source code is right there; the people who wrote the code are usually available to talk to/inspect their other code; it's not even exactly clear that this is theft per se and there's no jurisdiction that's really going to chase you down for it; so on and so on and so on.
I'm not sure you could create a more compelling target if you tried.
That being said, I uncovered once a security hole (in reality it should be called an open door) in the admin password of the now disappeared bbox2, the official router for the belgian company called Proximus.
How did I discovered it ? I wanted to watch ip addresses going through the router because I knew the owner of the box was up to something about me... But almost immediatelly I discovered the admin password field was like an 'universal lock', meaning any key could open it... in other word word, any string entered in the password field allowed to access admin pages of the box. After a few google searches, I discovered the software (the OS) was the last version, dating a few years back, and the box producer didn't pushed anymore update, not even security update. (Look at synology NAS scandal where Synology dropped software update for one of its older hardware to have an idea of the kind of thing it means for hardware facing internet access).
I immediatly reported the security hole to the federal cybersecurity unit, and after that, kept my mouth shut because there wasn't any way to fix this security issue except replacing the hardware itself. At that time, between 1/6 to 1/4 of routers in belgium were bbox2. I never heard anything from the federal cybersecurity unit (except a mere thank you by mail) or Proximus, but 1 year and a half later, bbox2 where nowhere to be found anymore in belgium. The only thing I have left from that is the mail I sent to the cybersecurity unit with screenshots of the bbox2 admin pages.
Why did I report it and shut my mouth without taking credentials for it (that's the kind of things which can launch a career in security field) ?
Because it's one thing to try to snoop on an accointance browsing activity, it's another to let a security hole of this magnitude in the open, and a far worse thing to disclose it to the public while there is no fix for it. And that's another level to sell it on dark market or to the chinese or russian ambassy (I'm not in the hacking business but I'm pretty sure they would have dropped a big pile of cash for that).
Just to say, Bruxelles is also home of numerous european institutions...
Maybe that's why the european parlement voted for mandotary code review for everything facing the internet in EU ?
Crypto, NFTs, Blockchain and the rest of this nonsense should never have existed in the first place.
And yet we enter another year where there is still no legitimate usecase for all of this whatsoever.
But most of what is in there is about things like stealing Bored Apes, which is basically just phishing, or NFT value collapse, which is just a speculative bubble popping. In the first case, I don't see any way that regulators are going to be able to stop phishing. And in the second, that's just a standard bubble. No fraud involved. Not much different that the Beanie Baby speculative bubble. I don't really think there's a government role in preventing speculative nonsense like that. Fuck around and find out.
> And in the second, that's just a standard bubble. No fraud involved.
I disagree. There are plenty of shitty coin/NFT projects marketed using celebrities/influencers where the project founders have no intention of delivering on their promises. They're just there to pump and dump, which is a type[1] of fraud.
The "good use cases" effectively don't exist. Every crypto solution falls into one or more of these buckets...
- Has substantial centralized elements, could be done vastly more efficiently with a DB
- "Decentralized" but still requires some central authority to provide critical features (particularly any form of conflict resolution)
- Depends on one or more smart contracts to effectively be perfect code with no bugs or unintended behaviors
- Primarily used for illicit goods and services
I'd prefer my tax dollars to not be spend advertising negligible positives. Now an ad campaign focused on crypto's problems? That I could get behind, would have far less peripheral damage potential.
This line of debate is quite tiredsome. You don't see the advantages of crypto because you live a privlidged life with good banking, and thus don't see the use cases personally. But they do in fact exist.
"Has substantial centralized elements, could be done vastly more efficiently with a DB"
Second, this idea that anything you can do in crypto you can do "more effeciently" in a typical db is just plain discouting the benefits of decentralization. For example, when we centralized our supply chain in China, it was more efficient, but boy did it hurt when the pandemic hit. Now i'm never going to argue about putting everything in the blockchain, but there are substantial benefits to putting the important stuff in it.
"Depends on one or more smart contracts to effectively be perfect code with no bugs or unintended behaviors"
The Airplane you fly in needs to be engineered near perfect, or people die. Crypto development can't be "move fast and break things", it means slow and methodical development.
"Primarily used for illicit goods and services"
Because the regulatory framework is undefined, legitimate people don't want to risk going to jail because they accidently created a security. It's not because the technology is ONLY good for lillicit things.
This is the only actual use case. And it’s not a great look.
It's hardly usable in countries with stable economies, but in countries like Turkey and Argentina I can see crypto being a better alternative than the official currency. It just comes with the caveat that the unregulated nature of the money means it can stop existing or become worthless without warning and that a power or internet cutoff will make your funds useless.
Smuggling foreign currency can be illegal or even dangerous but crypto can often be bought from the comfort of one's own home.
Balancing that risk against the terrible mismanagement of one's nation's official currency can be a worthwhile effort for a very select group of people.
In a country with strict currency controls crypto is little better than foreign currency. They need to pay their bills in local currency. Their corner grocer wants local currency. Their taxes will be in local currency. Crypto users are in a worse situation than people using foreign currencies since they have to deal with not just black market exchange rates but wildly variable crypto exchange rates. They don't get to just HODL because they need to pay bills. They have to accept whatever that day's wild value swing of their crypto holdings.
The places with broken currencies don't have strong rule of law. The authorities will shake people down for their wallet passwords as effectively as they do anything else.
The masses in broken economies turning to crypto is a fantasy.
Other comment has addressed the rest, I just want to point out that Bitcoin (and most other cryptocurrencies) are not _inflating_, they're _deflating_.
If the buying power of a currency goes up over time then it is deflating.
While this makes it (arguably) good for speculation, it actively punishes using it as a currency since what you buy today will be cheaper tomorrow. This - in turn - punishes the poor that would have to use crypto for necessities (food, shelter, water, etc.) since they will always have to buy necessities when they are expensive (today) rather than when they are cheap (tomorrow).
Just felt compelled to add this since a lot of crypto discourse talks about how the traditional market is seeing record inflation or whatever, and crypto doesn't suffer from as much inflation. While this is _technically_ true, the reality is that a deflationary currency is significantly worse for the people using it than an inflationary one. Especially when it comes to things like concentration of wealth in the hands of a few rich people.
This is wild to me. It’s like an entire industry driven by sunk cost fallacy.
Nothing but a microscopic amount, when compared to the tens of trillions of illicit funds being processed by banks in dollars and left unchecked. [1] [2]
Looks like this newsletter is another plain old side grift by Molly with the rest of the high profile extreme skeptics who are just as bad as the maximalists selling 'quality' rushed books riddled with typos and spelling errors pointed out by readers and crypto bros on Twitter [3] [4] [5].
Oh dear.
[0] https://blog.chainalysis.com/reports/2022-crypto-crime-repor...
[1] https://www.buzzfeednews.com/article/jasonleopold/fincen-fil...
[2] https://www.nytimes.com/2020/09/20/business/fincen-banks-sus...
[3] https://twitter.com/AlgoArcade/status/1554662257790943232
[4] https://twitter.com/NeddyPott/status/1547413083034947585
Wow. This is the first I've heard of that, but I've heard of crypto shenanigans endlessly. It's a distraction in comparison.
But also yeah, the crypto stuff is a distraction. Think of how much media, regulatory, financial, and technical mindshare has been consumed by this (as of now) hobbyist technology. It's pretty obscene.
[1]: https://www.helpnetsecurity.com/2022/05/30/spam-phone-scams-...
Thankfully (for us all), it seems that this story is not over! Our ancestors will look back on this absurd period of soft money and wonder what we were thinking entrusting something as critical as money, the lifeblood of civilization, to politicians. May it be brief!
Also, bold of you to bring up NoSQL seeing as how the sun has kind of set on that whole era. The new databases I'm seeing these days are all relational. Turns out Postgres was all we really needed.
AFAICT the limiting factors for something like libgen are harddisk space and the speed of one's internet connection. If those aren't a factor then one could go grab the entire thing with no friction whatsoever.
Blockchain does not help the user with either of those limiting factors.
Further-- while I don't understand the economics/incentives of private trackers like what.cd or redacted, it appears that they've addressed the availability problem wrt rare files. I.e., bittorrent does a great job replicating the most popular files, and a poor job replicating the least popular ones. But on these trackers the user can select any file from the index and essentially be guaranteed fastest possible download time from any nodes that have the file. AFAICT blockchain is not used in any way, shape, or form in this scheme.
Blockchain is indirectly used by sci-hub for receiving Bitcoin donations. That's not nothing, but it's also not new.
Finally-- in the entire time that sci-hub has existed, has any innovation in blockchain made a significant, positive difference in sci-hub's ability to do their work? If so, I'd love to read about it. If not, it appears they only use it because literally every other donation method is unavailable to them.
From reading pro-blockchain comments on HN for awhile, it appears that blockchain is a technology that slurps up attention and refocuses it on how to make blockchain a better blockchain, so that more blockchain devs can get involved in blockchain.
It would be like if 99% of emacs developers hacked on emacs to the exclusion of literally any other project, forever. But the improvements they were making to emacs somehow only ever increased productivity for other emacs developers who work only on emacs, and no one else.
That emacs in reality is less insular than blockchain should really snap you back into reality on web3.
these same posters, however, don't have an inch of skepticism that there could be equally bad people sitting in powerful western financial institutions.
If anything, crypto news over the past year has proven one thing: that the crypto space is just as corrupt as “traditional finance,” but with none of the guardrails that make it harder to commit blatant scams.
Society developed immune responses to financial fraud in the form of regulations. They are insufficient and evil people still take advantage of loopholes in the system. However, crypto right now is a living example of how much worse it could be.
In addition, being able to state that X worth of cryptocurrency disappeared into a tumbler or mixer isn't particularly transparent, either.
If society deems that level of transparency beneficial, it can be implemented on centralized databases much more cheaply.
On the other hand, if there are people using DeFi's ability to take out very short term overcollateralised loans at above tradfi rates to finance anything other than speculation on crypto, they're being very quiet about it...
"don't have an inch of skepticism" seems to better describe the collective from whom more than $4 billion was stolen this year without recourse than those who did or didn't fall prey to traditional banking fraud with consumer protections in place.
2% inflation is not a natural state of affairs, it’s a target that’s considered the “appropriate” amount of inflation.