My humble 0.02 is that what's current is immature and unstable, but there's a decent chance that Ethereum, or Bitcoin, or both, will at some point in the future provide some interesting technical solutions/services.
The fact that Ethereum is not there yet is not a good enough argument for me.
Crypto Currencies are an emerging technology that have value far beyond currencies. IPFS for example, d.tube etc.
HN is a crypto “safe space”. Just don’t talk about it here.
My problem is that these projects are simultaneously treated as humble little experiments and the perfect future of the global financial system, deserving of hundreds of millions of dollars of investment and endless public attention. If they would pick one or the other, I'd be fine with it. But I've dealt with years of a radical, quasi-mystical pro-crypto contingent who believe they deserve all of the upside with none of the accountability. I am 100% over it.
In short, the crypto hate is a reaction to the crypto hype. I have very little sympathy for people who profited from the hype, delivered approximately nothing of use to the rest of the world, and now have a sad that there are consequences.
Actually, as someone who was very interested in Bitcoin in the early days of 2011-2012, I disagree. If anything, the hate on HN was even greater back then, way before Bitcoin became hyped. So many people were convinced it was a pyramid scheme. It was clear to anyone familiar with the Bitcoin community back then that there were a lot of highly technical, talented people, and very few scammers. But most of HN reflexively despised Bitcoin.
In fact, Bitcoin on HN is actually a lot less hated now, which tells me it has little to do with the hype, and that something else was going on.
Bear in mind that I disassociated myself from Bitcoin once the scammers, con-men, and get-rich-quick types infiltrated the community around 2013 and 2014. But even back in 2011, there was a very high number of HNers who seemed personally affronted by the very idea that money was a social agreement. They seemed to believe that money was some kind of official, government activity, end of story. And that anyone who believed otherwise was an evil heretic, to be ridiculed.
> I have very little sympathy for people who profited from the hype, delivered approximately nothing of use to the rest of the world, and now have a sad that there are consequences.
This I agree with 100%.
That said, the 2011-12 critique that Bitcoin was a pyramid scheme turned out to be approximately correct. Much like Herbalife, the actual product was never good for much, and its actual utility was basically irrelevant to its rise. And as with many pyramid schemes, a collapse came when the supply of new entrants became insufficient. There are differences, of course. Pyramid schemes have a central authority, while Bitcoin doesn't.
I definitely agree that this is a perennial HN problem, though: "And that anyone who believed otherwise was an evil heretic, to be ridiculed." The field necessarily attracts idealists; so much of making software is continuing to insist on an idea until the computer eventually agrees. But it's regrettably easy to go overboard.
This x10. If I were to anthropomorphise HN it would be a middle aged white collar worker, pretty smart, making fairly keen observations about the evolution of a company's product and social structure, but in the dark about executive-level play. Financially conservative, thinks of money as a necessary evil. Stashes money in the bank and is highly suspicious of financial risk.
To this character Bitcoin is a threat because it mixes that which they care strongly about (open source, distributed systems, impact) with that which they've largely ignored and of which they are suspicious (money).
Edit: grammar.
I never found Bitcoin threatening though. When I finally read Satoshi's paper, it struck me as beautifully elegant, and a great experiment in practical economics.
But let's also remember, that middle-aged character has seen the hype cycles many times before in previous decades, and recognizes the scam. The sky-high and unstable valuations, the co-dependent press coverage, the hand-waving distraction from the absence of realistic uses, the flurry of me-too startups, the enthusiasm of lay investors.
Hype usually indicates pure bullshit, but sometimes something useful emerges out of it. Most often the original projects are decimated.
It's highly unlikely that the free market somehow sorts this out in the future, considering that it's the free market that gave rise to these power law distributions to begin with.
There will always be some limiting factor or theoretical vulnerability. If it's not ISPs/Internet infrastructure, then its the exchanges and fiat on ramps. But yet, its been pretty hard to kill illegal filesharing, VPNs, etc.
It's even harder to stop those things when the population doesn't believe in legislating against it, at least in a democracy.
I’ll let other people prognosticate as to what, if anything, that means for their future.
Like what?
Programs that don't require brute-force commonly use many times less energy than programs that do rely on brute force.
This extra cost is often seen as wasteful.
Can you give an example of a program that gives similar results?
I think as entropy becomes very inefficient to produce (difficulty multipliers increasing on crypto as the network expands...) it will become more clear that the expensive part about sending money internationally is trusting all parties involved.
You pay VISA/MASTERCARD a 3% fee because you trust them to protect your account in the case of fraud. Moneygram takes 2% of all transcations over $900 because you trust them to move money from your account to the recipients account without losing it.
Even in computer security, you have to put your trust in something. Somebody picked cryptography and high numbers of CPU cycles.
Anyway, you asked what problems crypto could solve, and I guess my answer is, maybe it will cost less to send money around the world. As it turns out, there's not necessarily a way to make it free.
While that may be technically correct, it's ignorant of the fact that costs are always passed down the line in any economic relationship like you're describing.
That fraud protection costs the card issuers, which is the basis for that merchant fee, and the merchant passes the cost on in the form of higher prices. (Merchant accounts with higher fraud rates will pay higher fees!)
So from another perspective, you actually are paying the bill for those unknown percentage of frauds, which you wouldn't be as much on the hook for so directly if only everyone was responsible for their own individual security.
So, credit card or not, the cost is there, even if I pay with bitcoin or ether. Except of course for the benefits of the credit card.
If people start charging less when paid via methods that have less chargeback risk will you reassess?
Only if the vendor of the TV is abiding by the rules of the credit card provider not to offer discounts for cash transactions.
In effect, the customers buying TV's with cash, paying the same, are paying a "credit card tax" to support the credit card users.
Also, they pay the same, but don't earn any of the incentivizing kickbacks (points, cash back, ...).
You're transacting with the merchant, and a third-party, the credit card company, helps itself to a piece of the action.
Whether that is coming from you or the merchant is the wrong view.
The transaction between the two of you pays it.
As with most things, this can be sort of solved with heavy regulatory structures and enforcement, but I would argue that it's not better solved, especially once proof of stake eliminates the problem of burning energy.