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Comment by wonderwonder | Hacker News Reader

A whole world currency that is potentially immune to inflation and government manipulation.

No currency conversion fees.

The ability to send funds to anyone with no middle man and no fee (besides the miners).

Also the removal of business and corporate surveillance. Right now Banks, Mastercard, stripe, venmo etc. know everything about you. They can then leverage that information in any way that they want. I don't like that. You run for office on an anti banking or big business platform and amazingly its leaked that you have an ongoing monthly subscription to X.

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> A whole world currency that is potentially immune to inflation and government manipulation.

You said potentially, so I’ll give you this one.

> No currency conversion fees.

This is a function of the market, not the underlying instruments. It’s also not true of most crypto markets, and I’m not confusing the spread with fees at exchanges.

> The ability to send funds to anyone with no middle man and no fee (besides the miners).

No fee (besides the miners) isn’t much different to no fee (except this fee). It’s still a fee, and in the case of Bitcoin, the fee has potential to be prohibitive (and already is for some use cases that it was designed for, e.g. buying a cup of coffee).

> Also the removal of business and corporate surveillance. Right now Banks, Mastercard, stripe, venmo etc. know everything about you. They can then leverage that information in any way that they want. I don't like that. You run for office on an anti banking or big business platform and amazingly its leaked that you have an ongoing monthly subscription to X.

Bitcoin is not anonymous, Monero could be unmasked[1], if you’re leaving a digital footprint, someone will eventually be able to follow it.

[1] https://arxiv.org/pdf/1704.04299.pdf

Look, if you are going to be a critic then you can't stand behind ignorance.

The "fees are just too high to buy a cup of coffee" is an old trope that is no longer relevant. One can go download LND 0.5 and use the lightning network to make instant practically free payments for a "cup of coffee" today.

The only thing I'll concede is that it is still in beta, but the question of whether it's going to exist or not is no longer a question.

The way Lightening Network is designed kills the p2p aspect of the Bitcoin protocol.. LN is predictably to benefit capital holders with enough excess capital to act as the backbone hubs. Normal users will be unable to bypass the Bitcoin banking/payment processor LN hubs and unable to reliably route though peer to peer paths on the LN.

This presumably is intended to enrich the Bitcoin oligarchs as a passive way to extract rent and wealth on the network simply for controlling existing capital.

This design choice indicates either a comic level of negligence, or intent to shift away from p2p to centralized information control.

only a 1% chance of successfully routing a $67 payment on the lightning network:

https://i.redd.it/twku0lwslz411.jpg

  Sending payments using the Lightning Network is cheaper 
  than the regular Bitcoin network, but suffers from 
  routing errors and wallet bugs that make it impractical 
  even for highly technical users. [1]

[1] https://medium.com/andreas-tries-blockchain/bitcoin-lightnin...

This is mostly nonsense.

If you don't want to use an LN hub, then create your own. If you don't have enough money, then raise some capital and start a LN hub business. Hell, create a non-profit LN hub! If you don't want to pay for the service of using other LN hubs, then send a direct payment. Of course, this will cost real money, but you always have that option. If I'm sending money to purchase a house, you can bet I'm going to send an actual transaction and not use the lightning network. For cups of coffee, I just don't need the full decentralization.

Claiming that we will not be able to solve the routing problem on the lightning network is exactly the same as claiming that we won't be able to solve the routing problem on the Internet. Routing is a solved problem, but is a difficult problem to implement, which is why the clients are in BETA.

Your link is bullshit, as I mentioned the network is in BETA. Of course people don't have a bunch of money on the lightning network and can't route large payments like $67. That's because the network is in BETA, and all of the platforms are expressly telling people not to use it for large payments.

  Claiming that we will not be able to solve the routing 
  problem on the lightning network is exactly the same as 
  claiming that we won't be able to solve the routing 
  problem on the Internet. Routing is a solved problem, 
  but is a difficult problem to implement, which is why 
  the clients are in BETA.

You clearly don't understand the architectural differences between how the internet routes packets, and what how the Lightening Network claims to be a decentralized routing protocol. Nodes in a decentralized network have no visibility to peers unless there's a map, the map needs to be updated, and in a payment network the complexity increases as nodes and activity increases. LN will not function for p2p decentralization, it is a design choice that creates Bitcoin banks and Bitcoin payment processors.

For digital payments I could skip the scam and use Venmo or cash.

I don't get why anyone would bother wasting their money on LN? You have to first buy the Bitcoins which is highly volatile so the risk of losing your money is always possible.

What's the use case? Why bother going though all the trouble and why is there a need to buy someone elses tokens which they basically made for free?

It sounds like you need to convince people to use Bitcoin because you own some and need more people to buy it so you can sell for fiat and make real money. Why else would you try to dismiss the inherent issue with race conditions in decentralized routing networks? Handwaving the flaw by saying "it'll be fixed in the future" is either your ignorance or a lie and an attempt to deceive.

You can't even claim it's the fault of beta software, because it's not even theoretically possible to solve the decentralized routing problem. LN is just another form of paypal/banking.

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

Quiet obvious how your scam works.

First of all, I know a little something about how routing works. I've written a simplified implementation of OSPF and also BGP. I've been an engineer at a backbone hardware provider before.

That said, I have never seen any convincing argument that LN routing can't work in theory... Especially because the lightning network is not completely decentralized on purpose. It works off the idea of "hubs", in which you will connect to a hub, likely one hop, and then the hub will most of the time get to your destination in one or two hops. I'd really like to see someone who claims that we don't have the ability to connect two points in a graph separated by three, or even four, hops. This is just made up nonsense.

The middle part of your comment is just "kids, get off my lawn". Why would anyone need anything besides venmo or cash? Do you mail cash to purchase things online? How many large Internet retailers accept venmo? How many people are implementing micro payments using venmo?

The rest of your comment is just an ad-hominem. And not only is it that, but it's also nonsensical because maybe I have some bitcoins because i'm putting my money where my mouth is.

Also, the travelling salesman problem is bullshit and irrelevant, because LN doesn't need to have the shortest possible route to work, it just needs a workable route.

https://study.com/academy/lesson/attacking-the-motive-fallac...

> A whole world currency that is potentially immune to inflation and government manipulation.

There are lots of ways that powerful governments can still put their thumb on the scale. US taxes still need to be paid with US dollars, and they can squeeze / regulate the exchanges, or influence, for example, the devs working on bitcoin.

Also, the design of bitcoin is inherently deflationary, which isn't inflation, but has its own set of problems. Saying that nobody is going to have the power to fix those problems isn't a huge selling point.

> No current conversion fees.

Well, I guess if everyone in the world settled on a single cryptocurrency. But that's also true of any other currency in the same situation.

> The ability to send funds to anyone with no middle man and no fee (besides the miners).

What is the importance of not having a middleman? Is it so that you can avoid regulations/fees that you'd otherwise be subject to? To me, this seems like the entire value proposition of cryptocurrency.

> Also the removal of business and corporate surveillance.

This is a good point.

What problems do you see with deflation?

It pushes currency holders to hold currency in their pockets to gain interest (sell it later for more), and not put it to economy's circulation.

That's a quite simplistic Keynesian view of economics. Economy != money changing hands. Savings are necessary for economic growth as they represent unspent resources in the economy that can be put into long-term projects and investments.

That's the thing with deflation: money holders don't have incentive to put it into "long-term projects".

Do the money holders keep their money in their house? Or do they keep it in banks? What the banks do with the money? Nothing? Or lend it to new businesses/invest it?

The biggest problem I see with deflation is that it becomes rational to avoid actually using the currency. This massively decreases demand.

Not many people are using bitcoin to buy pizza any more, because there's a hope that if they just HODL a bit longer they'll be able to buy lambos with the same amount of bitcoin.

That makes bitcoin less useful as a day-to-day currency. If the entire world economy was based on bitcoin, there would be a deflationary spiral and no clear way to fix it. This would be the mother of all depressions.

Yeah, Bitcoin's falling to Gresham's Law like gold did before it.

If you have two forms of money, one of which is inflationary and one of which is deflationary, it becomes rational to hold the deflationary one and spend the inflationary one. Eventually all transactions happen in the inflationary currency, and people forget that the deflationary one is money at all - it just becomes a collectible.

One of the intriguing possibilities of cryptocurrency to me, though, is the idea that a currency could have its inflation rate algorithmically determined so that all market participants know exactly what it'll be worth in the future, irrespective of the actions of any central bank. Extra points if any new money injected goes to people actually transacting with it rather than people holding it as a store of value.

I've long thought the problem with the Fed isn't that it exists or that it increases the money supply, it's that it injects new money at the top of the economy (banks etc.) and measures its effect at the bottom of the economy (consumer prices). That a.) gives a long time lag between the Fed's actions and their effects, which tends to make them overcorrect and b.) means that all sorts of shenanigans can go on in the meantime.

Other than a non functioning economy where wealthy oligarchs control everything simply for showing up a few years early and taking control of the money supply because they already had surplus capital to either mine or purchase the easily produced Bitcoins in 2009-2016..

Bitcoin has a higher inflation rate than USD.

  Bitcoin inflation rate per annum: 3.87% 
  USD Current inflation rate for the United States is 2.7%.

Early in Bitcoin history, by design Bitcoin went though a period of hyperinflation where Satoshi and a few users acquired most of the coins in circulation. Aprox 4.11% of Bitcoin users (addresses) control 96.53% of all bitcoins in circulation.

  >A whole world currency that is potentially immune to 
  inflation and government manipulation.

But completely exposed to private manipulation - malicious coders inserting backdoors into wallets which allow theft of users funds, weak private keys that are later regenerated by the dev, and so on.

Or manipulation from exchanges which generate counterfeit accounts and fake volume in order to steal BTC from the market before they exit scam like most of the exchanges in the past have.

What do you think about Tether and "stable coins" being generated by the billions for free (and then those operators using the counterfit stablecoins to steal BTC/XMR/ETH)?

https://medium.com/@bitfinexed

The common theory is that Bitfinex, Tether, and most of the Cryptocurrency exchanges are operating as fractional reserve banks - and creating more cryptocoins for free, meanwhile "buying" Bitcoin, Monereo, Ethereum, and so on for free because they operate in the dark.

If this is true, it's worse than real central banking, and it's quiet possible Bitfinex and other exchanges have stolen the vast majority of BTC in circulation.

  Protections for Customer Funds Are Often Limited or 
  Illusory. Generally accepted methods for auditing 
  virtual assets do not exist, and trading platforms lack 
  a consistent and transparent approach to independently 
  auditing the virtual currency purportedly in their 
  possession; several do not claim to do any independent 
  auditing of their virtual currency holdings at all. That 
  makes it difficult or impossible to confirm whether 
  platforms are responsibly holding their customers’ 
  virtual assets as claimed.

https://virtualmarkets.ag.ny.gov/

https://www.bloomberg.com/amp/news/articles/2018-09-27/crypt...

Maybe I'm just naive, but I suspect that the US government will long outlast SHA-256. Beyond that, I'd much rather put my trust in a democratic process than a plutocratic one.

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