Why All Cryptocurrency Should Die in a Fire

https://www.currentaffairs.org/2022/05/why-this-computer-scientist-says-all-cryptocurrency-should-die-in-a-fire/

by oalessandr • 4 years ago

225 323 4 years ago

__B_B__2• 4 years ago

Whining about proof of work. Check. Whining about ransomware. Check. Ponzi scheme. Check. What an organic article and opinion.

oriolid• 4 years ago

So, so you have definite proof that nobody could figure out these problems on their own?

Comevius2• 4 years ago

I found it informative, Nicholas Weaver knows what he is talking about. He calls these criminal enterprises for what they are.

criddell• 4 years ago

Low effort comments ripping on other people’s work contributes nothing to the discussion. You clearly have a different point of view so why not rebut the article or post your own laying out a counter opinion?

__B_B__2• 4 years ago

Well let me put it to you this way. He whines about proof of work, as is popular to do. Proof of work means to expend resources to produce a true statement such that the cost of lying is prohibitive, because producing an accurate record is better than producing nothing, given the same expenditure.

Cost of refutation is a related rhetorical concept. If this worthless article is going to can a few common critical tropes, all previously addressed, even by other technologies in the same space it aimed at, why should I do anything other than respond with equivalently low effort?

Because you want me to expend the resources? I thought wasted resources were bad? That's the premise of the whining after all, isn't it? Disingenuous, worthless article, preying upon stupidity, fear and moral outrage, which just happened to be filed within days of most cryptos dropping 25% in price, roughly, in the middle of a bear market.

ogogmad3• 4 years ago

This might be a purely stylistic criticism, but it's hard to take articles seriously when they lack professionalism: "Why all cryptocurrencies should die in a fire". I can see the editor smiling and rolling his eyes when making that title. It was cute at some point, but now it's painful, and it's unprofessional.

Comevius2• 4 years ago

It's a casual interview, not a dissertation. Beside the tone is the right one, crypto does a lot of damage to the planet and society for the benefit of a few already wealthy people, while pretending to be doing the opposite.

bshepard• 4 years ago

Surely, yes, but the whole social metasystem does a lot of damage to the planet for the benefit of the few, so why scapegoat one part of the system?

jamesredd• 4 years ago

This guy calls Elon Musk a "walking talking Dunning-Kruger syndrome". That's the level of discourse you can expect from him.

alkonaut• 4 years ago

I have never read a more apt description of a person. Sure, it’s childish, edgy and inflammatory. See now I accidentally wrote another Musk characterization.

HL33tibCe7• 4 years ago

True though

fastball4• 4 years ago

Elon Musk mostly speaks about things he actually is an expert on though?

whiteboardr• 4 years ago

And unfortunately is “inspiring” a whole generation with his behaviour. Very sad actually.

corobo• 4 years ago

Writing someone’s entire being off because they have a one liner you don’t agree with is kinda small minded, isn’t it?

In my experience it feels like people have more hits than misses given enough chance, even those you disagree with /shrug

lordofgibbons2• 4 years ago

I will gladly stop using Monero if someone can tell me how to privately transact over the internet without CC companies (and others) spying on me and selling my data. Until there is a better solution, I'll keep using it.

jimbob45• 4 years ago

Prepaid debit cards?

yowmamasita• 4 years ago

How do you buy these without giving any personal information?

willnonya• 4 years ago

Where I live in the US we're not permitted to buy these with cash. We don't have to provide any identifying information to activate but we cannot legally purchase them without that link to the original card purchase.

VortexLain• 4 years ago

Unavailable in lots of countries.

pontus3• 4 years ago

Well, if you want true privacy you should try Zcash.

lrvick6• 4 years ago

Zcash is well designed but in practice I have yet to see any services accept it but many that accept monero.

lawn• 4 years ago

Opt-in privacy has some serious flaws, not to mention the trusted setup that IMO makes it untrustworthy as a currency.

lordofgibbons2• 4 years ago

While zk-SNARKs is a cool piece of technology, their source of funding[1] doesn't inspire confidence.

In addition to that, even the few people people who do use Zcash, don't use it's privacy features. 99% of their transactions aren't private and are fully traceable [2]. Why would you want your transactions to stand out?

[1] http://zerocash-project.org/about_us [2] https://news.bitcoin.com/not-so-private-99-of-zcash-and-dash...

fastball4• 4 years ago

Although ZCash is arguably built on better fundamentals (zk-SNARKs vs RingCT), ZCash's history is slightly more fraught than Monero's and that's enough to keep many people in the XMR camp.

edent• 4 years ago

I understand this privacy argument - but I'm wondering what the practical downside is of this "spying"?

I've been using credit cards online for decades and I am yet to encounter anything negative from doing so. I get that my credit card provider knows that I'm buying £X of goods from merchant Y. But unless that merchant is very specific, the card company doesn't know what I've bought.

And, if it did... so what? Perhaps I'm naive, but even if I was hiding (for example) my sexuality - what's the CC company going to do? Try to upsell me a rainbow themed card?

I try to take my privacy seriously, and I don't particularly want my interactions monitored and mined. But what are the actual, non-theoretical problems that this causes?

nanidin• 4 years ago

Have you ever needed to buy something illegal?

Gigachad• 4 years ago

The main real world problem is when your business isn’t able to use the credit card system. Adult/nsfw services and weed stores are the obvious examples. But I can imagine many more coming up over time.

drcode• 4 years ago

It's hard for you to know what purchases you MIGHT have done if you weren't constrained a priori to only making purchases from sellers that were big enough & sold products innocuous enough to get approval from one of the big 3 CC companies, or what products might have been available without this limitation.

lrvick6• 4 years ago

Metadata on credit card transactions you make at a pharmacy, smoke shop, adult toy store, or abortion clinic is sold to a range of entities including government agencies, adtech firms, insurance companies. Your travel habits and times you are often not at home also can be very revealing.

When this data inevitable leaks via hacks, or is used to target you when political tides change, suddenly you will be wishing we had all been normalizing alternatives.

I recommend everyone use tumbled bitcoin, monero, cash, or visa gift cards whenever possible. The less data we all give in aggregate to those seeking to sell changes in our behavior the better.

Your data pollution empowers entities that harm us all.

McDyver• 4 years ago

It's good you live somewhere where hiding your sexuality is not an issue.

But, for argument's sake let's say you can be put in jail or killed for your sexuality. You want to buy something from a specific store that caters exclusively to your sexual preferences. The CC company sells that to your government (or another entity wanting to enforce that), then you are arrested or killed, or you family harassed.

_Algernon_4• 4 years ago

A future government that is analogous to Nazi Germany wants to put certain groups into a concentration camp ("sexual deviants", religious minorities, you take your pick). Better hope there isn't a CC history that shows you buying sex toys or religious items in the last 30 years.

Sure, in the western part of the world, you could think that this is paranoid, but depending on where you are in the world, and what minorities you belong to the risk is real.

Heck, even in the US with the way the SCOTUS is going, this may become relevant sooner than you'd expect.

xalava• 4 years ago

The importance of privacy is not theoretical.

First, the data is accessible by credit card provider, but also by several financial and technical intermediaries. Second, there is no way for any of those companies to guarantee that the data will never be leaked.

Then, in terms of consequences, it includes reputional risks, security risks people know your behavior patterns, and to be arrested for being at the wrong place and wrong time. Then is all the track record of governmental overreach that used this type of data, from arresting environmental activists to killings based on sexuality (for example). It happened in everywhere, and it still happens today.

roenxi2• 4 years ago

I started in Monero after the Canadian trucker thing. The government response was scary. In no particular order, threats that got me interested in privacy coins:

1) Able to donate money without it being blocked (examples: Wikileaks, eight-wing political activism).

2) No trace of activity that can be used against me (examples: WWII, looks like it might happen again in the near future, situation is tense post-COVID).

3) When the next recession hits, want to have protections against government haircuts (a la Cyprus or the bail in mechanisms that were prepared after 2008).

Cryptos fit quite neatly into a threat model where my government going rogue seems to be possible but unlikely. It makes a lot of sense to me to have $1-10k in Monero as a weird emergency fund/political tool. Dunno how it will work out, this isn't really territory that has been open before. If cryptos weather the next recession and hold >50% of their value then I'd start looking to put more serious money in.

vasco• 4 years ago

They might not do anything nefarious and simply get hacked and now the whole world knows all your purchases, would that also be fine? I'm not saying this as if crypto solves it, because it doesn't, but that's one possible risk of someone having access to all your purchase history in one place.

ricochet11• 4 years ago

not long ago here where i live today it was illegal to be gay, i would have been locked up/ chemically "treated"/ killed. It took people doing illegal things and being able to organise and communicate to build their defence and solidarity so they could stand together and push back against the violence and injustice of the state.

its not that the credit card company might sell you a rainbow card, its that you might not even get to exist.

Many things are illegal, but not immoral. You have probably broken the law in your life, most people have. ultimate surveillance is damaging to society as it strips away our ability to change "how things are done around here". I know a few sex workers whove had their bank accounts frozen and forced into cash/crypto, is that fair? are they really causing damage to society? theres many examples of sexism/racism from bank managers giving mortgages/loans with different rates depending on who they are talking to, could we use zkproofs to prove income/assets/liabilities without revealing personal information? amongst all the hype and speculation (caused by desperation in our current systems) crypto is about these issues and is doing real work to address them.

and thats before we even get into how things might change in the future. maybe its fine for a credit card company to know if you are gay today, what about in ten years? what if it becomes a crime again?

ur-whale5• 4 years ago

I understand this privacy argument - but I'm wondering what the practical downside is of this "spying"?

Other than the fact that "why do I need privacy, I'm not a criminal" (the battle cry of people who are lucky enough to have been raised in the 5 places on earth ruled by non-abusive governments) has been debunked a million times, you need to consider the fact that - just like the oodles of information gather on you by big tech - this gathering transforms you into a product, not a citizen.

Now, if you don't mind being treated like a shearable beast of burden, then, you're correct, that's not a problem.

jjav3• 4 years ago

But unless that merchant is very specific, the card company doesn't know what I've bought.

But the merchant knows and (unless it's a very old mom & pop shop), they didn't do it manually, the itemized receipt is in their computer system. Which the government can easily obtain and correlate with the credit card transaction so now they have both.

As the downstream comments say, if you're any kind of persecuted minority, this is a big problem.

riedel2• 4 years ago

Most scammers targeting your retired parents know how: play store or other vouchers you can buy in the super market. In Europe a standard free IBAN money transfer probably does not lead to much spying either. The biggest use case for this kind of privacy crypto privides is the 'freedom' to do things not legal in your country. I am actually happy to live in a world with limited freedom at times although there is certainly room for improvement ( I do not consider crypto currency as one )

uberswe• 4 years ago

I disagree with your statement about cryptos biggest use case. However I also want to point out that legal can vary a lot between countries. There is at least one third world country where a woman can't even get an abortion without risking life in prison. If cryptocurrencies can help people who don't have equal rights with more privacy in such situations then I am all for it.

ur-whale5• 4 years ago

In Europe a standard free IBAN money transfer probably does not lead to much spying either.

Sorry to be the bearer of bad news, but this is just flat out wrong.

Also sorry I'm not able to provide tangible proof other than I have personally witnessed and been affected by the exact opposite of what you claim.

IBAN transactions big and small are extensively monitored and not on a one-by-one basis but rather used to paint a clear picture of economic actors and their interactions.

yashg2• 4 years ago

Exactly where do you use Monero?

samatman3• 4 years ago

Pretty cool that you can ask that question but no one else can answer it without his private key, which you don't have.

Not even vaguely true of "exactly how does yashg use their credit cards", which many people can answer in as much detail as they care to purchase.

binarymax• 4 years ago

The privacy is a myth, if you want to actually use the cryptocurrency to pay for things in the real world. If you pay fiat to get monero, the exchange has your info. If you cash out monero for fiat to buy something, the exchange has your info. The wallet and transaction in chain are permanent in the ledger. So where is the privacy?

shiftingleft• 4 years ago

Monero has some limited form of privacy that's fairly good in practice: you can't determine which of N accounts is the origin of a transaction, where N is some fixed small number (6 in Monero I believe).

habosa• 4 years ago

Unlike with BTC with Monero you can’t tell what I did with the coins in between the two fiat transactions. For most people that’s a very meaningful level of privacy, even if it’s not perfect.

MerelyMortal5• 4 years ago

I don't mind the company I'm buying an item from to know my name and where I live to send it to me. I do mind if they have the ability to look up my address balance or past transactions to other entities.

(Why I support Monero over Bitcoin.)

mattwilsonn8882• 4 years ago

Atomic swap from Bitcoin is the easiest and most effective choice. If not that or a local, in person swap, the worst they know about you is that you owned Monero at some point. This is assuming you take the required Op-sec for your level or paranoia.

Gordonjcp4• 4 years ago

Your "data" is not worth anything. No-one is spying on you. You are not interesting.

jjav3• 4 years ago

Your "data" is not worth anything. No-one is spying on you. You are not interesting.

The billions (trillions these days?) online advertising market clearly disagrees with you.

loughnane• 4 years ago

I came here to make this exact point. There’s scarce another crypto project I’m bought into but I _really_ want a way to make a private transaction online so I’ll support any project that furthers that end.

ogogmad3• 4 years ago

Blockchain cryptocurrencies rely on the economic incentives of PoW (or something similar) in order to function correctly. Has anybody modelled how the miners might behave under varied circumstances? So far, the incentives seem to be working correctly, with no double-spend attacks happening.

Retric• 4 years ago

Double spend attacks have happened, but having lots of hazing power doesn’t prevent them. A software vulnerability for example can render unlimited hashing power pointless.

ogogmad3• 4 years ago

My comment was asking about purely the economic side of things... That's the part of crypto that's hardest to judge.

latchkey• 4 years ago

Yes, there are a ton of papers up on arxiv on all sorts of topics around mining and PoW [1].

There have been plenty of double-spend attacks that have happened. For example, ETC has a 6.5 day deposit time on Kraken.

[1] https://www.google.com/search?q=arxiv+mining+pow

[2] https://support.kraken.com/hc/en-us/articles/203325283-Crypt...

samatman3• 4 years ago

Double-spend attacks on ETC serve to demonstrate the effectiveness of proof of work.

Forked minority chains aren't expected to be safe, and this is for sure reflected in the market value of the coin. Any time ETH miners want to gang up on ETC, they can.

Gibbon1• 4 years ago

Just remembered a couple of years ago I mentioned to a couple of friends that once the Feds zero interest rate policy ends cyrpto will collapse.

eimrine5• 4 years ago

What is your definition of collapse? Is losing few tens percent of value enough for you to consider your prediction as worked?

dharma1• 4 years ago

I think that’s true for all speculative assets that have risen in value during a period of loose monetary policy

unixhero2• 4 years ago

Please expand. This may be important.

ephbit4• 4 years ago

Let's see for how long the FED will be able to keep interest raised before having to lower it again.

I say they'll lower it again by 2024.

nemo44x• 4 years ago

Half the Nasdaq is down a whole lot more than BTC. I don’t think BTC is the most sensitive asset w/r/t interest rates and the market is proving that.

throwaway4good• 4 years ago

I think the best criticism against crypto currency is that it is essentially “regulatory arbitrage”.

Things are allowed inside crypto that is not allowed in the normal world of finance.

Ie stable coins: promising people 20% on their savings account by running an obscured ponzi.

Ie pump and dump.

Ie insider information. Insiders on exchanges buying up coins they know are going to be listed.

Etc etc.

(And proof of work of course is the key enabler as it allows those who are running things to hide their identity.)

gengiskush2• 4 years ago

"regulatory arbitrage" It is fancy way to call freedom. Yes it has been reduced to pump and dump scams but how is that different than the stock market?

eimrine5• 4 years ago

stable coins

Are not a real cryptocurrency.

pump and dump

Is absolutely a regular circumstance. Last what I remember is sawn wood situation on the very early 2022, afaik it is worldwide. I do not recommend you to buy right now a sawn wood from big stores before researching a market in your location, because some of big stores have been dumped after buying some big amounts of sawn wood on huge prices, and their warehouses are still full of this trade offer.

insider information. Insiders on exchanges buying up coins they know are going to be listed.

All of that coins usually does something opposite to skyrocketing very soon after early birds have received a way to short their tokens (I do not have any counter-example).

proof of work of course is the key enabler as it allows those who are running things to hide their identity

Some entities just don't have an identity, like an artificial intelligence. What if I want my pet AI to buy or change hosting without absolutely any of my participation or even knowing? (it is not my funds, the pet has earned it without my participation as well).

quickthrower22• 4 years ago

what makes stablecoins not a real cryptocurrency? They are a currency stored on the blockchain

MildlySerious2• 4 years ago

The only thing crypto does is to make these things available to regular people who aren't rich already. They're happening either way.

cuteboy193• 4 years ago

You think poor people don't already have a buffet of scams, MLMs and ponzis to chose from?

gengiskush2• 4 years ago

If it wasn't for the "potty police" banning drugs what use would people have for cryptocurrency? But the point is people have a use for it... When the author says "should die in a fire" he really means poor people drug users. The problem in his eyes is the drug users are now rich from cryptocurrency.

Havoc2• 4 years ago

help me make it die in a fire

I'm rather mistrustful of people that are this forthy about being against a new technology. If it really is that devoid of merit it'll die on its own.

I also think it is a rather fundamental failure to see the big picture.

Not efficient? Well neither was the Ford model T. Newer generations are getting better.

Similarly somehow existing systems seem to get a free pass for things that are consider fatal flaws for crypto. Criminal enterprise? What do you think all the drug trade and sundry criminals use? Seashells? No USD. Systemic risk? Fed is printing trillions and history is littered with financial crises. Humans have managed to make everything from CDOs to tulips crash. Its not unique to crypto.

Personally I think crypto is a 50/50 chance of working long term. The people certain it'll be a disaster seem just as silly as those certain it'll take over the world.

eimrine5• 4 years ago

Personally I think crypto is a 50/50 chance of working long term.

Exactly as a chance of meeting a dinosaur on your street today? What a coincidence.

sunwukung• 4 years ago

I think you missed the primer on statistics

chicob• 4 years ago

Well, dinosaurs, being a clade, are pretty common if you think of birds.

olalonde3• 4 years ago

I'm rather mistrustful of people that are this forthy about being against a new technology.

I believe this top comment reveals the real reason why many technologists actually hate cryptocurrency: https://news.ycombinator.com/item?id=31356579#31356857

wlll15• 4 years ago

I'm rather mistrustful of people that are this forthy about being against a new technology.

I don't really give a crap about what people do or don't do with new technology, ultimately what people want to spend their time and money on is up to them.

However, "Crypto" is different. If all it was was just the unbelievably irritating crypto bros rug pulling, ponzi scheming, wash trading, ugly NFT shilling and hacking all the while claiming to be at the spearhead of a solution to pretty much every human problem in existence then so be it. I would be capable of ignoring it. I would read a different article, do some work or go for a walk, ignored, done.

But "Crypto" (specifically the energy intensive kind) has a different problem, and that's that it has /massive/ externalities that it simply ignores, forcing us, the people who want nothing to do with it, to now deal with it, and with the people in the ecosystem that we find so objectionable. We are dealing with the significant fallout from their hobbies. We are in the middle of 1) a very serious climate crisis 2) a cost of living crisis where people can't afford energy to cook and heat (in the UK at least) and 3) a war that would likely be brought to a stop sooner if we could phase out Russian gas sooner.

All things that could be alleviated if "Crypto" and it's so-far intangible benefits were to dissapear.

That is why I hate "Crypto", that's why I call people out about it, why I'm "frothy".

Not efficient? Well neither was the Ford model T. Newer generations are getting better.

The Model T allowed people to do something that previously hadn't been done before. So far no-one has been able to point me at a single thing that public public blockchains do that either is worth doing and is only possible using blockchain tech, or is better (more power efficient, faster) than using pre-existing technology.

If people can point me at some of these things then we can at least start having a discussion about wether it's worth spending an entire country's worth of electricity on it.

bambax3• 4 years ago

This. A 100% this.

basisword3• 4 years ago

> 1) a very serious climate crisis 2) a cost of living crisis where people can't afford energy to cook and heat (in the UK at least) and 3) a war that would likely be brought to a stop sooner if we could phase out Russian gas sooner.

All of these things are the result of bad governing, not crypto. Maybe banning crypto would help them (I don’t believe that) but banning lots of other things would also help. What we really need is better energy policy, better foreign policy, and better regulation of companies destroying the environment and contributing unnecessarily to climate change.

Edit: The vitriol in some of the replies to this is fascinating. Did you all just lose a fortune in the crypto crash or something?

PaulHoule4• 4 years ago

It is like a viral infection.

Once somebody spends $400,000 on an ugly ape and then found they spent their money for nothing, they will become a permanent enemy of crypto. It’s just a matter of time before you join us (crypto haters) the difference is that some of us knew it was a scam right away and others will have to learn it the hard way.

peyton• 4 years ago

So far no-one has been able to point me at a single thing that public public blockchains do that either is worth doing and is only possible using blockchain tech, or is better (more power efficient, faster) than using pre-existing technology.

Using privacy coins I can donate money to causes I believe in (eg WikiLeaks) without fear of reprisal and with the knowledge that the funds will reach their recipient. If you have a better way, please let me know.

chalst4• 4 years ago

I don't see any cryptocoins that I regard as a success, but I am watching three that might be a success:

1. Filecoin: It was well-motivated from the start, to provide a cheap way to get counterparties (by default, a multiple of six) to pin content in IPFS. I don't regard it as a proven technology yet, but it's usable as it stands;

2. Brave's BATs: Brave annoys me with its cryptocoin boosterism, but in principle this provides an way for content providers to profit from gaining a readership that doesn't involve nasty ad-tech. I don't think the system provides good enough incentives for users to mint BATS as it stands, but I think that in principle the Brave team have a viable solution to this problem.

3. The Stellar payments infrastructure has a cryptocoin used to grease its wheels. I don't see Stellar's choice to mint their own cryptocoin as principled here (they could have allowed nodes to choose), but using some cryptocoin here is driven by use.

None of these coins use Bitcoin / present-day Ethereum style proof of work, so they do not appear to have the negative externalities you deplore.

NikolaNovak• 4 years ago

Speaking of externalities - climate change is a very real consequence many people choose to go Lalala about. Ridiculously pricey GPU? Now we have something people might notice :D

fartcannon9• 4 years ago

Where are all these crypto bros that everyone seems so upset about?

G3rn0ti3• 4 years ago

We are dealing with the significant fallout from their hobbies. We are in the middle of 1) a very serious climate crisis 2) a cost of living crisis where people can't afford energy to cook and heat (in the UK at least) and 3) a war that would likely be brought to a stop sooner if we could phase out Russian gas sooner.

Are you honestly blaming cryptocurrencies for climate change, inflation and Russia‘s war against Ukraine? That’s crazy.

Climate change is a long running issue that started waaay before Bitcoin even was invented. Still projects other than Bitcoin are working hard to implement staking to use much less energy.

Inflation is an issue brought on us by Western governments drowning in debt for decades: For wars in Afghanistan and the middle east, unsustainable social security systems, stimulus packages.

And Russia … Putin and his supporters have finally come to terms with the fact it lost its super power Status and in a peaceful manner make the most of their vast and empty territory.

fsociety999• 4 years ago

All things that could be alleviated if "Crypto" and it's so-far intangible benefits were to dissapear.

This is pretty shallow thinking. I’m sure the traditional banking system uses orders of magnitude more energy than crypto, but you don’t hear about that cause the “studies” about crypto energy use are funded by people who benefit from maintaining the status quo. In fact, you will notice most of the studies critical of Bitcoin focus on how much ENERGY it uses as opposed to its fossil fuel usage and greenhouse gas emissions. This is likely intentional.

Big tech companies like Facebook and Twitter probably use more energy than Bitcoin too, and it is debatable how much of what they do actually creates value in the world.

The U.S. military is one of the largest polluters in the world, and Congress nearly unanimously gives them hundreds of billions of dollars every year with very little debate or scrutiny or oversight.

The waste of natural resources and energy will not disappear just because crypto goes away. If anything, crypto will actually help SOLVE the problem sooner by creating real economic incentives to use cheaper and cleaner energy. Some estimates say that over 60% of Bitcoin mining now uses renewable energy, and it is trending in the right direction [1].

So far no-one has been able to point me at a single thing that public public blockchains do that either is worth doing and is only possible using blockchain tech

“Worth doing” is subjective so that’s a non sequitur, but I will give you something blockchains do that is only possible using blockchain tech: they allow control over the supply of money without a central authority. Separation of money and state, if you will. Some may scoff at this idea, but currency debasement has contributed to the collapse of many empires and governments in history [2] so the importance of this invention should not be understated.

[1] https://bitcoinminingcouncil.com/wp-content/uploads/2022/04/... I’m aware this study may also be biased in a similar way as the ones mentioned earlier, but it at least includes the methodology and sources.

[2] https://www.visualcapitalist.com/currency-and-the-collapse-o...

pibechorro• 4 years ago

Crypto proof of work mining is actually one of the most renewable friendly sectors. Its mostly waste hydro, waste gas, etc being sought after. Its not perfect, but that is the trend.

You also have to compare it against what its competing against, all those fancy bank buildings with 24.7 lights and ac, the staff to mantain the paper trail (their commutes, etc), the vast security forces and militaries there to secure it (military being the largest polluter), etc.

From what I understand, the growth of the network, especially when it piggy backs on layer two networks like the lightning network for btc means 99% of the transactions can operate in a non proof of work method costing little more than the servers used to run a popular website.

Its still sooooo early. The tech will evolve and competition is fierce for the best solutions. So long we dont try to regulate it to death and protect the status quo, its going to evolve in ways we are yet to imagine.

Schroedingersat2• 4 years ago

The model T is also a bizarre example because the negative externalities of the private automobile are so extreme that you are materially worse off now owning a car in a city designed around cars than not owning one in a city designed to minimize their use.

tejohnso• 4 years ago

But "Crypto" (specifically the energy intensive kind) has a different problem, and that's that it has /massive/ externalities that it simply ignores, forcing us, the people who want nothing to do with it, to now deal with it

Grossly inefficient personal transportation and industrial farming have massive externalities forcing people who want nothing to do with it to deal with it. That doesn't seem to be a concern that matters to most people. And they're exacerbating the same climate and energy issues.

Public blockchain can be powered by renewable energy, using its own value to pay for it, and can harness power in areas where it is not feasible to harness that power for other purposes.

Here's a podcast[1] episode with Saifedean Ammous, if you're interested in the value proposition. He claims Bitcoin actually saved his life, so obviously incredibly valuable to him. Lex does a pretty good job at pushing back on his evangelism.

[1] https://www.youtube.com/watch?v=gp4U5aH_T6A

yufeng66• 4 years ago

Model T is not efficient by modern standard. But it was the much more efficient compared to horse carriage at the time. Bitcoin is much less efficient than USD now. Very difficult to see why bitcoin would replace USD.

pwpw• 4 years ago

For what it's worth, you've essentially just described the argument for veganism.

alecst• 4 years ago

I mean, the Silk Road, like it or not, was a pretty wild innovation enabled by crypto.

bitxbitxbitcoin• 4 years ago

So far no-one has been able to point me at a single thing that public public blockchains do that either is worth doing and is only possible using blockchain tech, or is better (more power efficient, faster) than using pre-existing technology.

Facilitating certain types of illegal transactions. Ex, Sanctions evasions for the average Moe, online illicit substance transactions between complete strangers. So I would guess the crux of your statement is actually the “worth doing” part.

I respect your position but I respectfully disagree.

bambax3• 4 years ago

If it really is that devoid of merit it'll die on its own.

Many bad things don't die on their own; we have to fight them to the end.

(We're slowly coming out of a global pandemic which was quite "devoid of merit", for instance, but it didn't recede on its own.)

bambax3• 4 years ago

The people certain it'll be a disaster seem just as silly...

I'm not certain, unfortunately. But I'm hoping.

prepend3• 4 years ago

Based on its fundamentals it should be a disaster. But it should have been a disaster for 10 years and hasn’t crashed yet.

I’m not certain it’s a disaster and I don’t hope for its failure. But I’m against it like I’m against best buy warranties or whole life insurance.

They are bad things that shouldn’t exist and no one should buy them.

li2uR3ce• 4 years ago

If it really is that devoid of merit it'll die on its own.

Bring on the homeopathy! It hasn't died yet so it must have merit.

thawaya31133• 4 years ago

Lol at complaining about being frothy against crypto when crypto is nothing other than HODL Diamond hands cultists (I say cultists to be nice and not call them grifters and scam artists).

rscho• 4 years ago

Personally I think crypto is a 50/50 chance of working long term.

The chance is actually 100%, because future national currencies will be "cryptographic" tokens. Think of it for 2 sec: is there a government on earth that would say no to a financial system where you can track (poor) citizens' money down to the last penny, always and forever? There's your answer...

loup-vaillant3• 4 years ago

Wait, that’s the antithesis of what we currently call "cryptocurrencies", right? All centralised, all government controlled…

TimPC• 4 years ago

I personally think it’s a bit disingenuous to call people out for legitimate anger. The appropriate reaction to endless Ponzi schemes is anger. The appropriate reaction to pointless environmental destruction is anger.

So “be calm bro, why so angry?” no longer seems like a legitimate criticism. If you want people to not be angry don’t build technologies that are highly destructive and cause immense harm.

Other arguments seem to be of the form “sure the last 35 cryptocurrencies didn’t do anything meaningful but number 36 and 37 are different I swear”. At some point even radical skepticism is a reasoned reaction.

Bitcoin is literally destroying the world and it’s main proven applications are facilitating illegal transactions. I wouldn’t be opposed to governments banning the thing on account of the fact it intentionally makes it impossible to adequately regulate digital transactions for fraud. This seems like it would be a reasonable response to the excessive firestorm of ransom ware that seems to be the only transaction that can reasonably pay the Bitcoin fees.

Havoc2• 4 years ago

I personally think it’s a bit disingenuous to call people out for legitimate anger.

You misunderstand me. They can be angry all day long. My point isn't that they shouldn't be angry, but rather that it makes me doubt that their rationale is balanced.

Bitcoin is literally destroying the world

That's true for damn near everything we do. Everything from cars, to space travel to computing to doing laundry.

firestorm of ransom ware

And the internet brings an endless stream of viruses, spam, malware, hacking etc yet somehow people can accept that tradeoff just fine.

Few new technologies are pure positive only, or risk free, or awesome straight from the start.

Hnrobert42• 4 years ago

As the author notes, crypto is inefficient by design. Crypto systems rely on inefficiency to make scamming the system not worth the cost.

The author doesn’t want to wait it out because the cost to society in terms of wasted energy and support of bad actors is too high. He notes that he evolved into this position. At first he th out it was just silly. Then silly and annoying. Now just bad.

cypress664• 4 years ago

PoW is inefficient by design, which SOME cryptocurrencies use. But cryptocurrencies don't need to use PoW. Many already use non PoW systems, and others are going to switch away from PoW (such as ethereum).

rvz• 4 years ago

The people certain it'll be a disaster seem just as silly as those certain it'll take over the world.

There you go. Some cryptocurrencies will survive once the regulatory framework is more clearer and settles in which will result in most the useless ones and non-compliant ones withering away.

That is the most likely outcome rather than the maximalists believing all of them succeeding or the skeptics like the one in this article believing all of them being destroyed. We've have examples like introducing KYC/AML checks for the exchanges, then unregistered ICOs were made illegal in the US (other countries to follow). It still did not put an end to crypto.

Next will be the exchanges delisting privacy coins and the likely regulation of stable-coins.

throw0101a• 4 years ago

I'm rather mistrustful of people that are this forthy about being against a new technology. If it really is that devoid of merit it'll die on its own.

And in the mean time it's chewing through energy and uselessly adding carbon to the atmosphere. Blockchain's use case is generally the conditions of needing both (a) an append-only log and (b) being distributed/decentralized. I don't think there are that many places where it'd be of use.

I try to raise awareness of NIST's Blockchain Technology Overview, which is a good explainer:

* https://csrc.nist.gov/publications/detail/nistir/8202/final

See especially Figure 6 ("p. 42", 53 of the PDF), which is a flow chart to help you decide on whether blockchain may match one's use case. Extracted:

* https://imgur.com/a/RlUj9Ed

But we unfortunately now also have blockchain tied together with the notion of "money", and so folks are going bonkers over it (à la tulips and Beanie Babies).

An idea can take a long time before people stop practicing it, during which does a lot of damage: it's been 70 years and we're still stuck with car-centric/dependent suburbs.

loup-vaillant3• 4 years ago

I'm rather mistrustful of people that are this forthy about being against a new technology.

If cryptocurrencies can even be called "technology".

I have enough skills to implement a crypto currency from scratch. Some building blocks there are impressive and very useful: public key signatures, hashes. _Maybe_ ciphers and polynomial hashes as well. Those things I cannot design though I did implemented from specs (it was a ton of work). But as we all know, those blocks existed long before cryptocurrencies, and have lots of other uses.

Then you have the chained hash, which is basically a degenerated form of Merkle trees (patented in 1979) that look like a Git commit history. Git was first published in 2005, Bitcoin first appeared in 2008. Then you have proof of work (some computation that is hard to do, but easy to verify), which was an established technique before Y2K.

In the end, the one idea Bitcoin introduced that may not be obvious is this idea of a "longest chain", based on proof of work. We have proof of stake as well, but for now I’m waiting for Ethereum to implement it at scale to believe in it (right now most transactions happen in proof of work).

It’s a stretch to call that "technology".

dandanua• 4 years ago

"There is only one thing cryptocurrency is good for" https://youtu.be/J9nv0Ol-R5Q?t=1986

It's from author's lecture.

unixhero2• 4 years ago

It is just a CS guy, my PhD level CS friends are equally bombastic and not necessarily always correct.

JonathanBeuys3• 4 years ago

The article starts out with:

"The crypto world went into a full meltdown this week"

I don't know. Look at a chart of Bitcoins price on a log scale:

https://twitter.com/JonathanBeuys/status/1524810429884661761

To me, it does not look any different then it has looked for the last 10 years. Its a slowing exponential growth with a certain volatility. Nothing seems to have changed in the last week.

rco8786• 4 years ago

This is correct but the comment was about “the crypto world” which is no longer limited to BTC

JonathanBeuys3• 4 years ago

Bitcoin makes about half of cryptos market cap.

Ethereum makes another quarter and looks similar.

Tether makes another 10% or so and is at $0.998.

I find it hard to imagine that whatever happens lower down on the list of crypto projects can move the needle enough so we can come to the conclusion that "the crypto world" as a whole is in a meltdown.

cypress664• 4 years ago

People decide on a narrative ("crypto is bad and a scam" in this case) and they will see the world in a distorted fashion in order to fullfil their narrative.

So they see a significant drop in price, but completely within the bounds of previous drops, and they see it as full meltdown and the ponzi scheme popping, because that fits their narrative.

polygamous_bat16• 4 years ago

Ah yes, break out the log scale and the historical price. This is my favorite maneuver, break out the log scale and historical price chart to forget that a 20% dump over a week is just regular volatility for crypto.

JonathanBeuys3• 4 years ago

Not to forget that but to show that.

On a linear scale it is hard to see.

ddjsn1115• 4 years ago

The world needs decentralised assets. It’s the internet of money.

Some are shitty, some are not.

Monero and Algorand are two good examples. The latter carbon negative.

aww_dang5• 4 years ago

The core premise of these cryptocurrency haters is that they feel that their subjective value preferences are more valid than those of the market. This is a core tenet of central planning. It is plainly paternalistic.

Ironically, it is the central planning of interest rates which created an environment ripe for speculative bubbles. It is the heavy regulation of all things financial which has burdened online transactions. If not for onerous regulatory requirements perhaps cryptocurrencies would not have been popularized.

Then there are the obvious falsehoods and sloppy generalizations used to advance their argument. Not all cryptocurrencies are the same. Even if we accept their characterization of BTC as "wasteful" there are other options which are more efficient.

Their solution, predictably enough is to create more regulations and prohibitions. It is a tone deaf lack of self awareness. All the worse when they celebrate themselves as authorities on the topic.

Perhaps the interviewee is an expert on CS, but does that qualify him to centrally plan financial transactions? This is technocracy at its worst. A self appointed expert steps outside of his bounds to make wide sweeping proclamations.

Then there are the obvious cultural factors. An institutional academic favors institutional and bureaucratic control over markets, disregards the value of market consensus and individual preferences? Cultural bias and group-think or not?

ddjsn1115• 4 years ago

I completely agree.

shkkmo6• 4 years ago

The core premise of these cryptocurrency haters is that they feel that their subjective value preferences are more valid than those of the market.

That is simply not true.

As an early bitcoin supporter, my sentiment shifted against cryptocurrency as I worked with more and more companies that have been targeted by ransomware. I kept waiting to be able to pay for real things and instead I saw wave after wave of fraud, grift and extortion but no progress on being a usable currency.

It is the heavy regulation of all things financial which has burdened online transactions.

Really? Online "non-cryptocurrency" transactions have outpaced cryptocurrency transactions by a massive amount.

Cryptocurrency was a neat idea that failed to realize it's potential due to the complexity of operations in the real world. Instead it has become a cesspit of fraud, theft and self-deluding grifters that lie repeatedly to try to bring in more and more greater fools. There are still se cryptocurrency idealists out there, but it gets harder and harder to tell them from the grifters.

polygamous_bat16• 4 years ago

Perhaps the interviewee is an expert on CS, but does that qualify him to centrally plan financial transactions?

Reminds me of the old adage, "crypto is the thing where those who know tech are in it for the economics, and those who know economics are in it for the tech"

asdadsdad• 4 years ago

The Internet is by no means decentralized, and the most compelling argument for the inefficiencies of crypto, in my opinion, is that everything we've built on the Internet tends to centralization. "No one wants to run their own mail server". So eventually, we'll have spent all this energy and time in designing convoluted protocols that solve the exact same problem we had already solved, only less efficiently and with more hoops.

(edit: fix typo)

ddjsn1115• 4 years ago

Yes but people CAN run their own mail server and some do. That’s the point.

PretzelPirate• 4 years ago

Monero and Algorand are two good examples

I have to disagree with you here. Algorand requires relay nodes for consensus (and high throughput), and those relay nodes are permissioned and largely centralized.

It’s not accurate to call Algorand a “decentralized blockchain” or assets on it “decentralized assets”.

This is a big issue in the blockchain world - the details of the implementation matter so little to the participants trying to profit, that we have multiple chains in existence with centralized controls and people still think those are better than using an obviously-centralized platform. These platforms tend to have the disadvantages of centralized platforms without the protections they provide, it just isn’t obvious until that centralized control is eventually exercised.

ddjsn1115• 4 years ago

Anyone can run a relay. Though most are currently with the foundation. The architecture isn’t flawed.

mypastself3• 4 years ago

Somewhat relatedly, I’ve been wondering for a while now why so many people here are so intensely, emotionally against this tech (and consequently why so many mediocre articles on the topic with emotionally charged titles are upvoted to the front page).

Plenty of different arguments are offered by the commentariat, some of which have merit. But whether the stated reasons are environmental issues, political implications, scams, ransomware, or illicit trade, the one commonality seems anger and desire to ban and destroy all crypto.

A commenter recently stated candidly that they simply feel envy. They’re bitter about their bro-type friends and acquaintances getting rich overnight and flaunting their wealth. It clicked for me that HN commenters are more likely to personally know such people and feel resentful towards them.

That may sound like ad hominem, but I’m not addressing the arguments (many of which I agree with). I’m speculating about the reasons for the disproportionate level of ire directed against crypto on this forum, and personal resentment feels like a good candidate.

The reason I even care is that I’m hoping to read (even if not always necessarily participate in) higher quality discussions on this topic. The tech is here whether we like it or not. It might fail horribly (as many here seem to be hoping), but what definitely won’t help are the “I hope this Ponzi scam dies soon” one-liners on almost every article on the topic.

aww_dang5• 4 years ago

The quality of these discussions could improve dramatically. At this point almost all of the possible arguments have been made. We are at the dead horse flogging point.

kamranjon• 4 years ago

I think, and this article is definitely an example, that people realize it is largely illegal under current law, but is simply not being enforced by regulatory agencies. So when people get upset, I don’t think it’s just old man nagging about the new generation, it is more them trying to warn people about traps they have seen time and time again but have been reigned in by regulation but for some reason are allowed to be setup in this new crypto space without oversight.

yashg2• 4 years ago

>getting rich overnight and flaunting their wealth Only a small fraction of early adopters became rich. Most of the suckers who joined the ponzi reading about these overnight riches have lost money. Like a typical ponzi.

mypastself3• 4 years ago

That is roughly how the commenter described these people, and I have no doubt HN is far more likely than the average forum to be frequented by tech types who personally know successful early adopters.

Jach• 4 years ago

I've been partial to this sentiment for a while but I like a simpler expression: it's just the virgin no-coiner vs. the chad bitcoiner. Dismissive? Absolutely. But these posts and comment threads deserve to be dismissed. If I felt like being slightly more constructive perhaps it'd be worth noting that it's an over-explanation because humans just don't need much reason to become this polarized and frothy about things, see e.g. Sports or the Robbers Cave Experiment (despite the latter having issues).

maxerickson• 4 years ago

Some of it is because so much of the space is just naked scams.

And then the stuff that isn't overtly a scam tends not to make a lot of sense. Bitcoin is a wasteful way to do what it does, and things like that.

gnomewascool• 4 years ago

I’m speculating about the reasons for the disproportionate level of ire directed against crypto on this forum

I don't personally know any people who became rich on cryptocurrencies and also don't feel any particular envy towards the people who I know of, via the internet, but am pretty vehemently against cryptocurrencies, so I'm a sample-size one counter-example to your thesis.

I obviously don't think that my ire against cryptocurrencies is disproportionate, since if I did, I'd scale it down until I thought it was proportionate, so I think that it's justified by the object-level issues.

If I were to speculate on why classes of people like me are more strongly opposed to cryptocurrencies than other people:

1. We are (or feel we are) more qualified to see many of its technical deficiencies, some of which have been patched over the years, others of which seem fundamental.

2. We agree with the "crypto people" on many topics, such as decentralisation or privacy, but think that their solutions are broken, and worse we feel that their philosophy and approach is a bit of a dark mirror universe of ours (to exaggerate _immensely_ imagine that both groups were religious people who agreed completely on matters of scripture, but they inexplicably decided to worship Ahriman instead of Ahura Mazda). See also "I Can Tolerate Anything Except The Outgroup"[0].

[0] https://slatestarcodex.com/2014/09/30/i-can-tolerate-anythin...

mypastself3• 4 years ago

That’s fair, but your comment on the topic is significantly more measured than is customary for this forum. (If your usual comments are more along the lines of “God I hope this MLM cult crashes and burns soon”, than you fit my idea of angry anti-crypto HN commenter more closely.)

Thanks for reminding me to reread the Scott Alexander outgroup article.

UncleMeat• 4 years ago

I certainly think that "man I wish I randomly was a megamillionaire" motivates some people. I definitely wish I bought and held a bunch of BTC back in like 2012 or whatever.

But for me this is comparable to other forms of economic criticism. I believe that the path that cryptocurrency and related systems is walking leads to an extreme hypercapitalism where everything on the planet becomes an item for speculation and no behavior is possible without access to some capitalized token. A lot of people will get rich off that process but the reason why I think that this is bad is not because other people get rich off of it. I think it is a harmful system whether or not I get to buy a yacht.

coldcode• 4 years ago

You can say the same thing about stocks, gold, bonds, commodities depending on what year you are in. Everything goes up and eventually down again. Oil futures even went below zero not that long ago, now the cash price is over $100 a barrel. I saw the crash in 1987 and yet here we are, at all time highs recently. Crypto of course has less economic meaning as it's just bits, but anything that is traded goes up and down in value, even pointless things like baseball cards. Value is whatever people will pay today for something hoping it either goes up in value or provides them with some benefit (like a house).

Complaining that crypto is stupid is fine, but lots of things in history were stupidly valued (tulips, beanie babies, bored apes) and eventually the market did or will change. Crypto is worth whatever people will pay for it. It's not inherently evil.

Gordonjcp4• 4 years ago

but lots of things in history were stupidly valued (tulips, beanie babies, bored apes) and eventually the market did or will change

Only one of those things requires enough energy input to drive a massive V8 Landrover for a week every single time you try to exchange it, and it's not tulips or beanie babies.

bombcar• 4 years ago

At least with commodities someone somewhere eventually is actually consuming them - this acts as a stabilizing force eventually even if bubbles and crashes can occur.

danans• 4 years ago

down in value, even pointless things like baseball cards

Baseball cards that have any value aren't pointless. They are kind of historical artifact, and are traded like artifacts or antiques. They have value as long as enough people place value on baseball history.

Newly created baseball cards are effectively worthless, and a vanishingly small percentage will ever have any value.

Crypto has no cultural value like that. There is no sentimental value attached to it.

Eventually in the future when nobody cares about it remembers what baseball is, the cards will have no value, but the fact is that value today comes from both their scarcity and the ownership of a piece of history.

sudden_dystopia• 4 years ago

Yea, sorry but not going to trust proponents of MMT on economic issues. Yes crypto is mostly a scam. I do think that btc is different though.

block_dagger• 4 years ago

Most of crypto is trash. However, Bitcoin will live for a very long time and take on appropriately high value. I don’t understand the folks who don’t see its incredible worth as a store of value. It doesn’t need to produce anything tangible to be valuable. Indeed it’s more valuable as a pure medium it seems. That’s the point.

ephbit4• 4 years ago

WEAVER: Yes. So let’s take the cost of a transaction. The cost of a transaction in cryptocurrency systemically is the amount being used to protect it. I could build a system that would have the same throughput as Bitcoin, three to seven transactions per second, but with a centralized trusted entity. In fact, not even a centralized trusted entity. Ten trusted entities, only six of which need to be honest, because I use a majority vote system. I could do it on ten computers that look like this, that would burn as much power as a light bulb.

Okay, so Mr Weaver can conjure some "ten trusted entities" by simply wishing them into existence.

Either he doesn't understand why one cannot simply create a "trusted entity" out of thin air .. which would mean, he's not actually an expert who anyone should listen to .. or he consciously makes a lazy attempt at formulating an argument that superficially sounds reasonable, while not having any substance.

civil_engineer• 4 years ago

You could substitute “trusted entities” for “banks”. Get ten banks on board, buy them each a raspberry pi, and you are up and running.

seanhunter• 4 years ago

How do get the banks on board? Remember you only have the energy of a lightbulb between all of them and no way to pay them without incurring structural transaction fees of the sort the FA is claiming are solvable by this solution. Also remember the banks actively distrust each other and spend literally all day every day in every one of their businesses trying to beat each other in every possible legal/ethical way (and also sometimes some illegal/unethical ones). It seems somewhat implausible that out of the goodness of their collective hearts they will all decide to run your raspberry pi, play nice with one another and do the right thing.

Some problems are super easy to handwave away in theory but actually pretty difficult to solve in practise.

ephbit4• 4 years ago

Yea .. no.

I have a hard time believing that you're actually trying to understand, which kind of trust the people who created Bitcoin meant and why they thought it's important.

Just claiming banks are in that sense trustworthy either neglects that banks exist in states and can be influenced or is plain naive.

We live in a world where states and central banks are constantly trying to achieve goals by changing money creation.

No matter if you see that as problematic or not, you'll hardly deny that currencies are subject to extreme pressures from economic actors (governments, banks, societies, businesses, ..). Therefore claiming that banks can simply be "trusted" to withstand these pressures (by strictly enacting some agreed upon policy) is a bit like closing your eyes on the real world situation of currencies.

bitL• 4 years ago

Maybe he's a genius and solved distributed Byzantine generals with a single light bulb and majority voting?

mattwilsonn8882• 4 years ago

Holy cow you're right he should start a crypto currency based off this model.

stefano• 4 years ago

three to seven transactions per second, but with a centralized trusted entity

The byzantine generals problem doesn't apply when you have trusted entities.

dathinab2• 4 years ago

The point he is making is that you do not have to solve it, federated systems might not fully solve the "Byzantine generals" problem but they are "good enough" for most use cases in practice.

Let me make a different point:

I mean think about it for "legal" (legal unrelated to ethical) use-cases a federated systems of banks and maybe some external non-bank validators is good enough, by far.

Not "legal" use-cases are not legal and as such them not being supported is in the interest of the state you use them in.

Many of ethical good use-cases of crypto currency are not "legal", ethical yes but not legal anyway.

Like circumventing suppression in totalitarian states.

The problem is for each state by themself a "Byzantine considering" crypto currency is not in their interest. It can be use-full to help people in totalitarian states, but then this states can also use it to help extremist groups in your state while forbidding crypto currencies internally. So... not necessary the best choice.

Now federated not fully "Byzantine considering" crypto currencies are a different thing altogether. Like use bitcoing but replace PoW with PoS except the validators are predetermined banks with most in your country (or union like the EU, they might still stack money as collateral) and from a state view the problems are mostly gone/manageable (from a legal/state POV) and you get most of the technical innovation you want (I mean it is 99% the same tech minus "Byzantine considering" and maybe minus some privacy protections).

Now I'm not saying it's ethical good (or bad) for states to ban crypto.

But I am saying that from a purely objective non-ethic-considering view for most states it's best to just ban fully "Byzantine considering" privacy protecting crypto.

grogers• 4 years ago

It's byzantine consensus. It's slightly wrong since you need 3f+1 for byzantine consensus (so 7/10 not 6/10) but the basic point is valid. There are some crypocurrencies based on a similar model, but they aren't as popular.

CPLX• 4 years ago

The reason you need to avoid trusted entities is when you want to operate outside the legal system. Which is why the use case for crypto is, and always will be, contraband and gambling.

Which is a fine use case. Those are very large and enduring sectors of the economy. But let’s not get confused about why things are as they are.

mistrial9• 4 years ago

I have a detailed book on my shelf, published recently, where sworn US officials, took money and forged documents, then lied in court, multiple times, and it took years, many years, to get the evidence. Some attorneys involved were so mad about being lied to, with an unsupportive Federal Judge doing nothing, that parts of the case went to the US Supreme Court to challenge the authority itself. Read that book and get back to me.. 2010s era

edit the point here is - getting a "trusted party" is in fact, not easy, and certainly not "a bank" as a universal answer.. find your own copy of this book, it is repeated a hundred times, every decade.

ipv4dhcp• 4 years ago

the problem is that those "trusted entities", ie: banks have a high cost in terms of infrastructure, opportunity cost of all employees doing something else other than signing transactions, and the environmental costs associated with each bank employee's entire life. so while crypto energy costs are high, they arent as high as having humans existing somewhere hitting buttons for so called 'trust' and dealing with regulatory cruft.

johnwheeler• 4 years ago

It’s always “what they don’t understand”.

Here’s the facts: there are two types of people in this world, and which you are has nothing to do with intelligence.

You either participate in these types of activities, and you always have and always will, or you don’t, never have, and never will. It’s like it’s some weird quirk in human nature where God said, 50% of the people have to be this way and 50% have to be that way in order for this to play out.

The participants have an extra hurdle to cross though. They have to watch the zero sum gambling game play out where some people win and others lose and the winners paint themselves as financial geniuses. It’s hard to be around that type of company and not feel bad.

Again, I’m not saying anyone _is_ dumb. The crypto community have many fine people who add all sorts of value to society. But if you’re participating in this game, there’s nothing anyone can do to change your mind because you’ll always have counter examples to point to, and no one likes to admit when they’re wrong, especially to themselves.

FabHK4• 4 years ago

You could map those two kinds of people maybe by how they would act in a prisoners' dilemma. Cooperate, so that everyone is better off long term, or just think of themselves shortsightedly, no matter the externalities.

uwuemu• 4 years ago

I'll do you one better

Why All Of Silicon Valley Should Die in a Fire

Just an extension of the original... and just as dumb.

Also, I get the general sentiment on this site is CRYPTO BAD, mut can we please not jam the front page with links like this? What will be the next "why all x should die in a fire"?

notacoward2• 4 years ago

Why All Of Silicon Valley Should Die in a Fire

If they provide arguments, even (especially?) if those arguments are refutable, it might be worth reading. There's a lot to criticize about ad-supported Silicon Valley, and even VC-supported Silicon Valley. What's not worth reading is blithe dismissals - like yours - that don't make any argument at all but consist purely of tone-policing.

ur-whale5• 4 years ago

Obligatory:

https://99bitcoins.com/bitcoin-obituaries/

projektfu• 4 years ago

The disaster has already occurred, it just hasn't been felt yet. The disaster of 2000 was not the crash of the tech stocks, it was the previous year of pouring people's savings into a fire pit. What would it have meant for the economy to keep all those companies inflated? Surely only a bigger disaster.

jrm42• 4 years ago

While the vast majority of today's anti-crypto articles are generally accurate, always bet against articles like this, in favor of first principles.

"Anonymous-ish cash, but on the internet" is a very attractive proposition. I'd also add to that "Locking up your money to get more money later" is as well. So much so that I'd strongly bet in favor of "people figure out how to make it more efficient, safer, and less destructive" against "It's just going to fail and go away."

polygamous_bat16• 4 years ago

Locking up your money to get more money later

Yes, there is a very simple way of offering that. Unfortunately it's currently illegal to do so in most places outside of crypto, where all of a sudden it becomes kosher as long as you can keep it wrapped in enough technobabble.

jrm42• 4 years ago

I mean, yes, this describes "ponzi," but also nearly literally all "investment." One may not like "Capitalism," I suppose, but yeah.

Patrol8394• 4 years ago

I can move $ in less then a day and for free just using my bank. Now, try to do the same with a stable coin running on ETH … and check the fees . To me it does not feel innovation, but rather going backwards.

charcircuit• 4 years ago

you cannot store cryptocurrency on an internet-connected computer. Because what will happen is, if your computer ever gets compromised, all your money gets stolen and there’s nothing you can do about it.

This is the point of having a hardware wallet. Someone has to push a physical button in the real world to sign a transaction.

And [ransomware] only exists because people can pay in Bitcoin.

The concept of ransoms predates cryptocurrency and would still exist without it.

And my gain is not just the difference between what I bought it for and what somebody else bought it for, but that plus the benefit of all the dividends and interest.

Stocks aren't guaranteed to just go up. If your stocks even pay dividends that might not even cover your losses.

So the stock market and the bond market are a positive-sum game.

The stock market isn't positive sum. Someone is going to be holding the bag when a company goes out of business.

but [Tether] does have the potential for bank runs causing collapse, because it’s unbacked.

This is false. See https://tether.to/en/transparency/

Tether tokens, loans them to their big colleagues in the cryptocurrency space

See the above link. Their reserves aren't made up those kinds of loans.

The cost of a transaction in cryptocurrency systemically is the amount being used to protect it.

This isn't true. If I charge $100 per transaction that doesn't mean that $100 of that goes towards protecting it.

So let’s do programs that cannot be updated that handle mone

This isn't true. Smart contacts get updated all of the time.

There’s no mechanism to fix problems if they occur. There’s no undo button. In fact, there’s often no way to upgrade at all.

This is just plain wrong. You can even make upgrades which are delayed that you can potentially cancel to prevent from being applied.

kkfx• 4 years ago

My own personal opinion on cryptos is that they are a tentative by some GAFAM to overtake banks at their own game, considering that as actual "fiat" money cryptos are "virtual values, substrate of anything" witch appear to be free but due to their mechanics are bound to network and computing power witch means to some IT-enabled subjects, so in practice as free as fiat currencies these days for their "end users", and "a bit more free" for "real owners".

However as any "money" concept rooted on "money is the value" instead of "money is just an unit of measure of some substrate" are no more scam than actual currencies, should face the same fate anyway.

notacoward2• 4 years ago

So far I've seen three variants of the "he just doesn't understand" argument in comments, including the currently top rated comment, and the day is still young. I bet there will be more, because it has become crypto advocates' favorite tactic to negate real argument. Unfortunately, it's an appeal to (false) authority. Why should anyone believe that the crypto advocate - even without considering the taint of self interest - knows more about the subject than someone like Nick Weaver or David Rosenthal who has a decades long record of actually solving closely related problems? At best, with only a few exceptions, the advocate is a relatively new programmer in a completely different specialty. Often they're not even technical at all. Where's this authority that's supposed to override rational arguments (even if those could be countered)? At least people like those I've named don't rely on authority and take the time to provide real discussion-worthy points as well.

This is supposed to be a rational reality-based community. There should be zero tolerance for the "just doesn't understand" trope, especially when someone doesn't even identify (let alone explain) what it is that their target doesn't understand. It's blithe dismissal, not curious conversation, and at least nominally (according to the guidelines) not what the site is supposed to be about.

beej71• 4 years ago

I get the environmental argument about proof of work, but aren't other consensus mechanisms addressing this?

DennisP• 4 years ago

Most of this is old hat but there's one claim I thought was interesting and decided to check, and it's laughably wrong:

We’re talking [a measurable percentage] of the world’s electricity consumption, most of that has not been paid for. So the mining companies for the most part have been taking the cryptocurrency and borrowing against the cryptocurrency that they create, rather than sell it, because the market’s actually very thin.

So supposedly, the markets are too thin to support the miners actually selling their earnings to pay their power bills. Let's check the top two against 24-hour volume on coinmarketcap:

BTC volume: 1M BTC

BTC issuance: 6.25 BTC every 10 minutes, or 900 BTC in 24 hours, or 0.09% of the trading volume.

ETH volume: 8.5M ETH

ETH issuance: 2 ETH every 15 seconds, or 11,520 ETH in 24 hours, or 0.14% of the trading volume.

I don't think the miners have any trouble selling their earnings for fiat.

Why All Cryptocurrency Should Die in a Fire

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