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Comment by moxious | Hacker News Reader

Blockchain seems like a brilliant solution when multiple anonymous untrustworthy parties need to get together and agree.

But to the point of this article, most situations aren't like that. You have identities, contracts, and trust at least as much as can be enforced with the legal system.

I have also seen a lot of over-application of blockchain to "standard" banking problems. I guess it's real value will depend on whether or not it's successful in "decentralizing all of the things". If that doesn't happen, then it may just be a very cumbersome way of doing something we already knew how to do.

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Blockchain is a terrible solution.

Firstly Proof of Work is incredibly energy inefficient, to extent that electricity consumed to append to public blockchains is comparable to electricity used by nation states.

Secondly POW by its inherent design recentralises trust. When mining evolves to deploying on ASIC and deploying it where electricity is cheap you are recentralising trust to a tiny few who are willing and able to fulfil the ever higher and steadily increasing bar that POW, by design, demands. The trust model at this point has evolved from technical difficulty of fabricating & maintaining long duration forked chains to one where key block creators are too financially invested in success of the chain overall to allow fraud to happen. At this point, when your trust model is essentially too much to loose to cheat, there are scant distinguishing features between a blockchain ledger and a traditional centralised clearing house.

To steal a line from a good book I read recently about blockchains: "The good bits of blockchain are not original, and the original bits of blockchain turn out to be much good."

[Edit: grammar / readability]

While your criticisms are valid, you're criticizing just one implementation of "a blockchain", namely chains secured by CPU-bound PoW. There's plenty of other implementations with different trade offs. You could design your PoW algorithm to be more ASIC-resistent, eg https://crypto.stackexchange.com/questions/29890/memory-hard.... You could switch to proof of stake. You could use whatever algorithm XRP is using.

Also, by saying "blockchain is a terrible solution", I assume you mean "there are other better solutions [to the problem of creating a decentralized ledger, or whatever]". What are those better solutions?

"blockchain is a terrible solution" doesn't imply "there exist better solutions". It can mean that it's terrible in absolute terms, not relative -- i.e., that the value of being able to create a decentralized ledger is much less than the cost of blockchain(s).

I agree that bitcoin's use of sha256 nonce seeking is a very easy target for critique. My broader assertion though is that proof of work, by design, will always centralise into a few, one way or another. Other theoretical schemes may be more resistant to centralisation though my instinct is that unless you find some sort of PoW mechanism that strongly anchors to some universal and impossible to simultae physical constraint of the universe we inhabit, POW mechanisms of any economic value will all race towards centralisation shrinking number of signing peers.

Proof of stake at this time is purely theoretical. It lacks strong proof that it solves the problem it sets out to solve. I personally doubt it is a viable solution and my belief it is a dead end avenue of research. Notable there are no large scale implementations yet, even eth rolled back the clock on POS.

Never heard of XRP before. Very briefly scanning, looks like a distributed consensus type protocol, which isn't anything new doesn't attempt to solve the core concern about decentralised trust. Realise am being a bit flippant here, I need to study more which I will, but this is my initial impression.

>> I assume you mean "there are other better solutions [to the problem of creating a decentralized ledger, or whatever]". What are those better solutions?

No I am not saying this at all. Why is it incumbent on me to solve this problem merely because I advance a critique of the current solution? Does my failure to bring an alternative to the table make my critique invalid? I don't think so. I have been puzzling over this problem space and exploring some ideas for alternatives. The problem is hard and honestly I am probably not smart enough to solve it. But the problems are interesting so I'll keep turning it over.

In terms of my thinking right now, I am not even confident that problems solved blockchains are even problems worth solving, that blockchains provide us, as a society, anything of value at all. Too much is given up: notably for example dispute resolution. Look at all the long parade of thefts and errors that have happened on Eth, the legacy to date of the idea of "the code is law" is problematic at best. To date I can only think of one real use case that has made me think blockchain/bitcoin is actually even useful : when US DoJ leaning on Visa/Mastercard to cutoff funding to Wikileaks, bitcoin provided good stopgap technical solution to this grotesque legal excess.

> Never heard of XRP before. Very briefly scanning, looks like a distributed consensus type protocol, which isn't anything new doesn't attempt to solve the core concern about decentralised trust.

To save you some googling, it _does_ try to solve decentralized trust. It goes for a more traditional scheme, a variant of Byzantine agreement.

However, there was a dispute wherein David Mazières (of Kademlia fame) claims that Ripple's design has a flaw, that he fixed in SCP (Stellar Consensus Protocol), by designing FBA (Federated Byzantine Agreement) as described in his paper: https://www.stellar.org/papers/stellar-consensus-protocol.pd... (which features a comparative description with Ripple and Bitcoin).

That's why all the "enterprise blockchain" stuff doesn't use POW. (These are technically "ledgers" not "blockchains" but people don't understand the difference anyway.)

But then you have nothing new. Hash chains are at least as old as a 1981 Lamport paper, and merkle trees (the data structure inside a blockchain block) were patented in 1979.

I'm not talking about hash chains. I'm talking about systems like Corda, Quorum, or Hyperledger that use BFT to provide mostly-trustless consensus without POW.

Blockchains and POW are mostly orthogonal concerns. They've become associated because one implementation chose to use it, and is very well known. Also because POW is an effective way to grow network-effects by distributing profits to those that participate in 'mining'.

That depends on how you define "Blockchain".

My definition of "blockchain" is a distributed ledger in a entirely trustless p2p network. To which PoW is the most widely deployed mechanism in use to secure against the double spend problem. Pow being a mechanism that remains un-superseded inspite of significant efforts to do so. All this making PoW hardly orthogonal.

Of course this definition of a "blockchain" can be loosened. One of two tweaks and suddenly we need to label prosaic everyday items such as a git repos as "blockchains".

At which point it becomes difficult to even have conversation about "blockchains" since our industry has yet to bring to bear a sufficient amount of focus to even define the term with any sort of useful precision.

"That depends on how you define "Blockchain"."

https://en.wikipedia.org/wiki/Blockchain

> electricity consumed to append to public blockchains is comparable to electricity used by nation states.

That's not even vaguely close to true. Are you basing that on blockchain.info's retracted estimate?

A few different sources compute similar results.

All of them acknowledge difficulty in computation. It's like trying to solve the drake equation. Unless you know all the terms in the equation accurately the number at the end isn't terribly useful.

Many different computations seem to be in same order of magnitude.

The result of high energy consumption is unsurprising and intuitive, given the design principal of PoW. It's all about who is prepared to do the most work, up until economic limits set by current BTC rate.

Let's do an upper bound, assuming miners are making enough to pay for their electricity (at an extremely low price), but not to pay any of their other costs (cooling, hardware, server operation, profit, etc):

(12.5 * 6) BTC/h * 2000 USD/BTC * (1/0.02) kWh/USD = 7.5 GW

Ok, that is a lot. Energy usage is on the order of a few million Americans. Sorry, I based my first reply on a debunk that doesn't sound accurate!

> Firstly Proof of Work is incredibly energy inefficient, to extent that electricity consumed to append to public blockchains is comparable to electricity used by nation states.

Proof-of-work is designed to be inefficient -- to consume exactly as much power as the bitcoins produced from it are worth. The more efficient PoW is, the less energy it requires to rewrite history, which is exactly what we're trying to avoid.

> it may just be a very cumbersome way of doing something we already knew how to do.

This is a very accurate description of many modern developments, most of which tend to attract projects that want to overuse them.

You just described 50+ years of software development in one paragraph.

I might just print and frame this short thread.

> Blockchain seems like a brilliant solution when multiple anonymous untrustworthy parties need to get together and agree.

No. What you described is the problem of Byzantine generals, for which efficient solutions are known since '80s. Think again what blockchain is, because it's not agreement protocol.

The Byzantine generals problem doesn't address malicious nodes, just failure prone ones. That's a pretty big difference

Well, Lamport didn't know that the generals are only allowed not to vote when he was writing the original paper. I read the original publication. Have you?

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