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You haven't rebutted his central argument, which is that for all the smart people working on it and all the important supposed political ramifications of the idea, no blockchain of any sort has been scaled to any mainstream consumer financial task.

He's not disputing that smart people work on it, or that there aren't variations on Bitcoin, and so pointing those things out doesn't respond to his article.

You can disagree with him as you can disagree with anything, but if you want to support the argument that it's "awful", you'll need to do better.

Billions of dollars are moved around in cryptocurrency every day, this article just misses all that apparently. It's not a good article, don't recommend for any smart people it's a waste of time.

Yes, but what impact has blockchain had on the world outside of blockchain?

Id suggest going to Venezuela and looking for yourself.

Literally all coverage of Venezuela and bitcoin has come from bitcoin promoters, interesting-sounding claims being reprinted without verification. None of it I've seen traces back to anywhere else.

What we actually see: 370 BTC a week on LocalBitcoins, which is negligible in the context of the country.

The closest to a verifiable claim: that miners who were stealing electricity were arrested. Of course, stealing the electricity has long been a favoured Bitcoin mining strategy.

@discodave Billions of dollars moved around is actual wealth that has impact on the "world outside the blockchain". A lot of cryptocurrency is being exchanged for goods and services outside of the blockchain. Considering the amount of wealth being exchanged with cryptocurrency it has more impact on the real world than 99% of businesses or startups have or will ever have.

"no blockchain of any sort has been scaled to any mainstream consumer financial task."

Maybe the OP could have written a post in 1990, 17 years after the first handheld mobile phone prototype, about the tech "still having not reached mainstream consumers, therefore being a failure."

The OP seems unaware how fast Bitcoin is growing. Not mainstream yet, but it's growing. https://en.m.wikipedia.org/wiki/History_of_bitcoin#Growth

Extinction, and failure, is the law. Survival, and success, is the exception. Just because dropout $billionaire is in charge of $unicorn, does not mean that all dropouts will be billionaires.

Bitcoin is no exception. It may survive, but the story about mobile phones (and any tech that succeeded) is irrelevant here. We can have this discussion when and if it is a consumer success.

The first mobile phones had clear value, many initial customers, and a bunch of people who were obviously interested if the price came down. Where is the equivalent waiting market here?

Similarly, where is that short-term growth coming from and how would you distinguish it from a speculative bubble? Lots of companies reported amazing growth from 1995-2000, too, but anyone who looked at their fundamentals couldn't justify it.

The "waiting market" with Bitcoin is effectively caused by network effects. If your financial transactions don't involve peers accepting Bitcoin, then you have little incentive to use it. The more people use it, the more incentives you have to do so.

It has given the general public very convenient access to a "gold-like" asset.

Immutability causes bitcoin to have no counter party risk, just like gold. It has limited supply, similar to gold. Along with all the other money-like properties of gold.

Yet it is far more portable and accessible.

> Banks dragged down by capital obligations from Dodd-Frank regulation are looking everywhere for cost savings.

Name a single bank who is using blockchain in an essential component of their operations (not just a proof of concept). Go on, I'll wait.

Sure, blockchain is "interesting" and the people involved are "brilliant" but where is it delivering a 10x improvement over the status quo?

Blockchain is a classic example of a solution looking for a problem.

> Name a single bank who is using blockchain in an essential component of their operations (not just a proof of concept). Go on, I'll wait.

What a ridiculous argument. With blockchain really just becoming interesting over the last 2 years, you think banks, many of which use systems 20-30 years old (bonds are still primarily traded over phone) are going to switch over to it immediately. Give me a break.

> Sure, blockchain is "interesting" and the people involved are "brilliant" but where is it delivering a 10x improvement over the status quo?

International bank transfers can take days, have large transaction fees, and have a non-trivial amount of book keeping error. Whenever those same transactions could take 30 minutes with no human oversight I'd say the speedup is much higher than 10x. With that, it seems like you're more interested in making claims without being properly educated on what you're talking about.

This is what the supporters of limping technologies always say: "it's only been seriously considered for the last year or two, so it's too early to consider the results". And yet clearly, it has not been just 2 years over which we've considered blockchains. Why are blockchains more credible than all the other failed technologies for which these kinds of arguments are made?

Whatever problems you may have with international bank transfers, they work: every business in the world relies on them. For all the supposed benefits of blockchains, no blockchain solution can make that claim, or any claim close to it.

The slowness and cost of international bank transfers has nothing to do with technology used.

We could make a million of such transactions per minute using $1000/month hosted server. We have the technology.

The problem is legacy infrastructure and the fact that banks benefit from high fees on international transfers.

There is at least one successful business (transferwise) that makes international transfers much cheaper and faster using terribly inefficient work-arounds.

If banks were at all motivated to fix the issue, they would, using Java and a database. They don't need blockchain (which, btw, is slower to settle a transaction than updating a record in a database).

International money transfer is indeed a big problem, and TransferWise has built a billion-dollar company over the past 6 years solving it, just not with blockchain.

Heck, even Paypal is a smaller scale solution to this problem. Not to mention much more broken Western Union transfers.

It is not like the problem hasn't been attacked many times from different angles.

Are you trying to present blockchain as a technical solution to a legacy software issue? Clearly, there are other, far simpler solutions, and clearly this is not the real motivation behind blockchain. I think Bray's main argument is that the motivation behind blockchain -- decentralized trust -- is something we don't really need. Rather than just state this as an opinion, he points out that even blockchain's supporters haven't been able to demonstrate a need.

Maybe the confusion comes from how people are using the term "Blockchain", which actually is technically a term tied to Bitcoin but hijacked by VCs to create hype around it.

But I agree with you that "Blockchain is a classic example of a solution looking for a problem" assuming you're talking about the hijacked usage of "blockchain".

> Name a single bank who is using blockchain in an essential component of their operations (not just a proof of concept). Go on, I'll wait.

I think this is exactly the point. Banks trying to employ their own blockchain is the same as companies trying to employ "Intranet" when the Internet first came out. It won't work.

I don't know of any in active production, but I know of many banks and multiple banking consortiums that are investing lots of IT dollars on near-term blockchain deployments, and potentially at massive scale.

For bitcoin to succeed it doesn't have to be used by banks. Banks already have a system set up that relies on trust and enforcement of contracts.

I'd say that bitcoin has already succeeded, just not for the use cases that the author cares about.

> I'd say that bitcoin has already succeeded, just not for the use cases that the author cares about.

It's not a matter of caring. He points out that whatever uses blockchain has (or hasn't) proven successful for, don't amount to a significant economic (or social) contribution. He's talking about objective quantity, not subjective quality.

Where does all the hate come from?

S/he never said all implementations are slow, just that most are (which is true if you count all those toy implementations done by hackers who did it just for the learning experience; I alone contributed two).

Your "obvious use case" is not obvious to me. Nor are the foundations of your argument, that oversight and regulation drags viable banks down so much they need blockchain support to "save money". As you pointed out later in this thread, they are decades behind anyway.

OP's point is that s/he does not see the same traction other (failed) technologies had. I agree. You disagree. So we agree to disagree. But that does make the OP's opinion or your arguments any more/less valid.

To be honest the banks do not know what to do with blockchains.

Their best properties and the banks' needs are not aligned. When you add in stuff the banks need like forcible retraction of transactions, and transaction fees, you have essentially destroyed blockchains. The moment a major bank releases production ready blockchain of their own it will be such that most will not get any real value out of it.

What they are doing (not what they are saying) is that they are trying to figure out how to hug the blockchain technology to death.

> What they are doing (not what they are saying) is that they are trying to figure out how to hug the blockchain technology to death.

That's probably giving them too much credit for awareness of what they're trying to do. What I suspect they're doing is trying to get a handle on the hype about the glories of immutable, cryptographically secure storage technologies promised by blockchain, having conversations with blockchain startups consisting mostly of mutual misunderstanding and then hiring IBM or Accenture because they say "blockchain" a couple of times at the beginning of their presentation and then spend the rest of their time talking the bank's language and proposing to solve problems they already know banks actually have (not using a blockchain) in ways which don't create bigger theoretical problems.

[yeah, the people who definitely are doing the hugging to death are the mainstream IT consultancies that know that "blockchain" is the new "cloud" for sales hype to get people to rebuild a system that was only put in a couple of years ago. But I bet some of their middle management believes they're actually embracing the technology too]

I dont understand much of the "hate" that goes on with bitcoin/blockchain in tech circles. I get that people may not like the ideology/uses of some of the people involved but that to me has nothing to do with the tech. I downloaded a wallet and by using twitter I was able to have people send me coin within minutes and never had to identify etc. I know of no other medium that could do that.