Bitcoin's challenges seem to be a matter of current implementation, while Ethereum just seems like a bad idea, implemented as well as a fundamentally bad idea could be.
We need to think of better tools & practices to secure contracts. It's still all new, there will be issues, there will be improvements. The end goal is worth it IMO. My main Interest in Ethereum (and Maidsafe) like most developers in the community is not so much money but the dream of having a truly decentralised web one day. Impossible? maybe, but I'm willing to try.
Can someone explain to me how Ethereum fulfils the "dream of having a truly decentralised web"? From my understanding, it just sounds like Bitcoin with programmable contracts tacked on.
How would I run, say, a reddit-like site using Ethereum?
It doesn't. It's hyped up bullshit.
Every Ethereum node runs the exact same code (single threaded too) with heavy computing and storage restraints. There's no sharding or load balancing. Can you run the entire reddit website on a single 90s computer? The answer is no.
Don't get me wrong, Ethereum is an interesting experiment and blockchains are useful for a number of things, but the notion of "lets put everything on the blockchain" is a shitty, terribly inefficient solution looking for a problem.
It's true of any platform, but Etherium is at a far higher risk of getting hacked because the language is Turing complete. There could conceivably be a smart contract blockchain with a simplified language that was still capable of most of Etherium's good sides with the safety net of static verification tools.
Ethereum, the VM/system is Turing complete, but Ethereum of course is not a language itself. [Correction: EVM code, that is Ethereum VM assembly, is indeed a language. Thus, Ethereum is technically both a VM and a language ("EVM assembly code") - which makes the assertion that "Ethereum is a language" correct after all.]
As far as I understand it, all current Ethereum languages (e.g. Solidity) are also Turing complete, though it should be possible to create a language for Ethereum to produce only algorithms constrained with some level of decidability. This is why Ethereum is likely not doomed yet as some have claimed recently. However, and especially due to The DAO fiasco, it's now a matter of building static verification tools as you suggest, or decidable languages for it, and new cryptosystems may show up before it can get to its first killer app.
Full disclosure: No horses in this race at the moment.
As an aside, I think that everyone posting anything about Bitcoin or Ethereum should be posting a disclosure in each discussion (even an abridged one of some sort, just a couple of characters).
I can easily imagine a system built on a non-Turing complete logical query language that defines data and rules for presentation. You could get pretty far with that. You can't create _any_ application, but calling Turing completeness “essential … for decentralized applications” is incorrect. It's essential for a _subset_ of applications that require Turing completeness.
I've been saying ETH is broken for a while. Its computational ability means contracts _cannot_ be formally verified. This is why I didn't buy into the DAO, and sure enough there's a bug in the DAO (ironically recursion related).
This is why in general software verification doesn't try to come up with languages where all programs are verifiable, but aims to verify specific programs, sometimes regardless of the computational strength. Some programs in Turing complete languages can be verified (but certainly not all), just as some programs in FSM-strength languages can be verified (but certainly not all).
While it is certainly possible that a much bigger subset of, say, FSM programs can be verified than a subset of programs in TC languages, placing the bar at "Turing complete" is somewhat of a red herring.
Indeed, the LANGSEC link in the post[1] seems to understand that, noting that even verifying PDAs is undecidable, but it fails to note that even decidable verification tasks (for FSMs) are very often intractable, which -- for all practical purposes -- is just as bad as being undecidable.
As Vitalik put it:
"An important point about this project is that we see ethereum as being a platform first. If you approach it from the perspective of ether being a coin, with all the smart contract stuff being just bells and whistles on top to make the coin more valuable, you are going to have a hard time understanding this community; it's really all about the applications first and foremost, and ether is there simply as a token to facilitate payment of transaction fees and incentivize mining."
It does goes both ways as well, if you can contact your provider to get your stolen domains back, then your local dictator can also take them away from you because of something you said.
Thankfully, I don't (yet) live in a dystopian society where I can trust machines more than my neighbor (or leader).
Translation:
Ether is there simply for our pre-mine profits :)
If there is a way to do something like Ethereum or Maidsafe WITHOUT the freaking money I would LOVE to hear about it. It would be nice if we could work on this type of technology without all the toxicity of get-rich-fast trolls and the silly tribalism.
Bitcoin started with a bunch of people running some hobbyist cryptographer's buggy cpp to generate worthless tokens. You don't need millions of dollars to build free software.
> The Internet was done so well that most people think of it as a natural resource like the Pacific Ocean, rather than something that was man-made. When was the last time a technology with a scale like that was so error-free? The Web, in comparison, is a joke. The Web was done by amateurs. -- Alan Kay.
Ethereum is of the web kind. It's amateurish.
-as an investment, bitcoin is fundamentally a ponzi scheme. someone may argue that it is a challenge only if you are too late in the game, but for me, that is a reason I am not touching it as an investment.
-as a money (store of value and measure of value), there is a fundamental issue that there exists no mechanism whatsoever that would stabilize it's value (against neither a typical consumption basket, nor USD or any other currency)
-as a currency (means to make transactions). You might argue that it is only about implementation that the network can handle a couple of transactions a second. But a widely used currency should handle _lot_ more than that. Assuming one billion transactions a day means roughly one transaction per person per ten days globally. Every single byte you need to store a transaction implies a gigabyte of data per day into the however implemented network. I would call that a challenge beyond just implementation.
I don't believe you know what a ponzi scheme is if you think this because it's not remotely true. From google:
a form of fraud in which belief in the success of a nonexistent
enterprise is fostered by the payment of quick
returns to the first investors from money invested by later
investors.
> s a money (store of value and measure of value), there is a fundamental issue that there exists no mechanism whatsoever that would stabilize it's value (against neither a typical consumption basket, nor USD or any other currency)
Absolutely true, but by design, they don't want a stable value, they want a fixed amount of currency and want value to fluctuate via supply and demand. Bitcoin is inherently anti-keynesian by design. This is why it'll never be more than a commodity.
Now, you can argue that this is true for all commodities. But all other commodities have some other utility backing the value of the commodity. Bitcoin has practically none, as discussed in my other points of the challenges of bitcoin as money.
And even that bitcoin as fixed amount of currency theory is a bit questionable. There is no reason why a fractional reserve bitcoin bank could not pop up and create bitcoin-as-payment-money out of thin air, as the current financial sector does with fiat money. (This would obviously allow a mechanism to regulate the total bitcoin money supply, but then bitcoin would lose it's whole raison d'etre. Catch-22.)
Think of bitcoins as tokens or as tulip bulbs - it can be used for something - but the prices is not the main idea. If you buy them for the price rise you are creating your own "ponzi scheme"
> bitcoin as fixed amount of currency theory is a bit questionable.
The total amount ot bitcoins is not questionable.
> There is no reason why a fractional reserve bitcoin bank could not pop up and create bitcoin-as-payment-money out of thin air
If a bank lend out x times the value of the bitcoin deposited, they will not be able to pay them out as bitcoins.
If you dont have access to your bitcoins as bitcoins, but only as a bank statement about how much they owe you, you effectivly traded your bitcoins to an IOU.
I do not see what that "something" is, which makes it a ponzi in my eyes. (An open, honest ponzi, but a ponzi nevertheless)
> If a bank lend out x times the value of the bitcoin you deposited, they will not be able to pay them out as bitcoins.
But of course, if x < 1 (as is in fractional reserve banking), the bank can pay out bitcoins.
> If you dont have access to your bitcoins as bitcoins, but only as a bank statement about how much they owe you, you effectivly traded your bitcoins to an IOU.
Exactly. And if that IOU is from a credible enough institution, there is no reason[1] why I would differentiate taking a payment in that IOU or bitcoin. In which case that IOU is bitcoin-denominated currency and the amount of bitcoin-denominated currency in circulation is no more constant.
[1]Well, actually there may be at least two reasons to differentiate. First, the IOU may pay interest unlike bitcoin. Second, the practicalities in transacting bitcoins or IOU's may differ, which in all probability dictate that I prefer the IOU...)
Note that by this standard definition, Bitcoin is not a Ponzi scheme. You may doubt whether Bitcoin is a wise investment, but calling it a Ponzi is bound to cause confusion.
"a fraudulent investment operation where the operator, an individual or organization, pays returns to its investors from new capital paid to the operators by new investors, rather than from profit earned through legitimate sources."
Now, with the obvious note that bitcoin is not fraudulent, you must agree that "bitcoin (as an investment) pays returns to its investors from new capital paid to the network by new investors, rather than from profit earned through any other source"
And any claim that bitcoin offers sustainable positive returns is precisely as mathematically unsustainable than any ponzi scheme. That holds as long as there is new money flowing in. Not longer. That is very similar to a ponzi.
(And of course, any commodity bubble has this same property.)
Overall, I think there are so many similarities between the investment logic between bitcoin and a ponzi, that the comparison is justifiable.
Which makes it not a ponzi, really that's all there is too it; fraud is a necessary pre-condition to call something a ponzi. No fraud, no ponzi.
If you remove the fraud element as you are attempting to do, then virtually every investment counts as a ponzi, all insurance counts as a ponzi, because paying investors with money from newcomers is a thing common to a lot more than just ponzi schemes. The world is Ponzi SCHEME, the scheme means fraudulent, scam, etc. If something isn't fraudulent it is not a ponzi no matter how many other traits it shares with ponzi schemes. The comparison is thus not justifiable.
That is not what makes a ponzi scheme a ponzi scheme, that is one element of a ponzi scheme but it's no different than any investment in a company that takes off. This is insufficient to call something a ponzi scheme. There MUST BE FRAUD, or it's not a ponzi scheme.
> Bitcoin has practically none, as discussed in my other points of the challenges of bitcoin as money.
Absolutely wrong, bitcoin has utility, trust-less exchanges of value, that's a valuable service to provide and the reason bitcoin maintains value.
Say what?
There are so many ponzi schemes in Bitcoin many of them actually advertise that they are ponzi schemes.
I think you misinterpreted what I'm saying. Of course people run schemes using bitcoin just as they run schemes using USD; when I said "no fraud in bitcoin", I mean in bitcoin itself, the blockchain, the protocol, the currency. Bitcoin is a currency, and like any currency, fraudsters can and will use it, that doesn't make bitcoin fraudulent.