Hacker News Reader

Comment by cslarson | Hacker News Reader

Sovereign identity, DAOs, NFTs (not just the art stuff which atm is a little cringe but game items, land registries, deeds), stablecoins (usdc, dai, yes there is also wilder experimentation here).

I think people can quickly get dissuaded by some negatives like lack of scaling or environmental issues. These are real but are being solved. We really need communities like HN to engage because if proponents are right then the change will be vast and we are unprepared.

My personal favorite outcome is playing out right now. When a tech company is successful they capture near 100% of the value, despite leeching content off users. Ethereum based projects generally share rewards with the community of users that make the protocol/network successful. Applications are forkable, not just the code but the community, too. The community is in control.

View on HN

And what are some example use cases you can do with those things, or that people are using them for? Genuinely asking. I see people very excited about things like DAOs, but most descriptions seem to be about inter crypto use cases.

With the early internet it was easy enough to see there were use cases like “instantly send a letter to someone across the world” or “order a book not stocked at your local store” or “go directly to Nintendo’s website and read their info”. I remember doing this last one as a kid in the library and was instantly taken with the internet.

What are some similar ELI5 use cases of the Ethereum chain and those names you mention? Other than intra crypto loans, derivatives etc

https://seekingalpha.com/news/3680926-binance-launches-trada...

Liquidity for things that don't normally have liquidity.

Example: like wrapped Bitcoin, you could create wrapped Wine. Say you've got $1 million in a wine cellar. Create a wrapped token which allows you to use it as collateral or provide it to a liquidity pool to generate revenue.

Now your wine is earning you interest. Something like this may already exist...

Same for Tesla stock above. Now that a TSLA token exists you could provide to a pool for interest since it doesn't pay a dividend.

Commodities and future contracts on them have been around for a while now.

On your wine cellar?

Goldman Sachs did it years ago.

https://www.businessinsider.com/goldman-accepted-fine-wine-a...

> Now that a TSLA token exists you could provide to a pool for interest since it doesn't pay a dividend.

Explain further. Why would you be able to have the benefits of owning wine or TSLS and also earn interest on it. That’s your cake and eating it too.

There must be a risk element to the liquidity pool. What risk exposure are you taking by depositing TSLA stock there that you can’t get through normal finance?

> Sovereign identity

Not a real problem. Any civilized country has solved identity already.

> DAOs

A solution in search of a problem

> NFTs

Speculative. Game items, land registries and deeds are a solved problem. If your jurisdiction/company hasn't solved them already with Postgres and hardcopy it's because it's not interested in solving it or it's not a real problem, just a minor annoyance.

> Not a real problem. Any civilized country has solved identity already.

Jesus Christ. So the only problems that matter are the ones in "civilized" countries? What does that even mean?

Perhaps it means that this is a known problem with known working solutions. Countries that haven't solved identity are ones that either don't want to or can't, generally due to a mix of corruption and poverty.

Perhaps I am simply suffering a tragic failure of imagination, but I fail to see how adding a blockchain changes things substantially.

Being able to identify people via blockchain either requires them to remember some esoteric passphrase or an ID card with the identifier on it which...solves absolutely nothing.

> Countries that haven't solved identity are ones that either don't want to or can't, generally due to a mix of corruption and poverty

It's not a known problem because each country has its own context. That's like saying US healthcare problem can be solved just by doing what nordic countries do.

I'm not arguing for blockchain.

Most of the problems solved are not at their first iteration of solution. There will be a next one for most of them as well. None can deny that the crypto field opens opportunities for the next iteration of solutions

I do deny that they open up any opportunities.

Even if they might do things better (which I don't see that happening; solutions are objectively slower and more cumbersome than centralized databases with audit logging), they appear to solve "problems" that aren't really problems.

There's a lot of things that classify as annoyances and inconveniences in the world. That doesn't mean that I'm willing to dump a boatload of cash to solve them.

Identity isn't currently a technological issue. Microtransactions aren't a technological issue solved by blockchains. Ledgers of most things in general don't have a trust issue that's solved by blockchains.

Technies being techies think that technology solves a lot of issues just by existing while completely discounting the issues of trust and control in institutions themselves.

Most blockchain problems are actually governance issues.

This happens every time I ask for use cases in these threads. It is always something just over the horizon.

The early internet immediately allowed people to do cool stuff that was explainable if someone had a moderately open mind. If wasn’t vaporware.

Thank you. This mirrors my experience to a T. It's always those same empty sets of phrases

"Just imagine all those possibilities."

"It may not be there yet, but the smartest minds are working together on it."

"How can you not see what the importance of this new infrastructure?"

"DAOs, NFTs, [insert new useless crypto tech of the day]"

If, just once, they could just provide a single real use case that would actually improve my life... I get it, crypto is great for buying drugs on the internet, money laundering, riding the hype train, speculative investment, and so on. But I just have never seen any real legitimate use case that would benefit from crypto.

Buying drugs sex and hitmen online wasn't cool enough for you? You sound like a dork

We've banned this account for repeatedly posting unsubstantive comments. Not what this site is for.

> land registries, deeds

I hope that will never happen. We really don't need anyone to end up in a situation where a key is lost and they can neither prove they own something nor sell it legally. Also, "transfer your home by mistake" scams. And have fun trying to figure out how to deal with dead owners.

The other aspect of these is that, unless we're also going to eliminate the possibilities of courts ruling on things, the reversibility features of land registries and deeds is a feature, not a bug.

Husband and wife divorce and the courts rule that the husband gets the deed to the house and the wife gets the Ferrari. Husband refuses to transfer the Ferrari's deed. Now what?

Unless you mean that the land registry continues to exist but uses a public blockchain as their database? In which case... why? If they did decide they wanted it all public, auditable, and in the open, they could just publish it as a signed text file every day and anyone who cared could mirror it.

Don't get me wrong, I think there's some really cool possibilities in the space, but lots of the things that get proposed are fundamentally subject to court orders. Unless we change the law so that judges can't say "I don't give a shit what the 'blockchain' says, A belongs to X and B belongs to Y, and anyone who won't play ball can sit in jail for contempt until they get on board," there won't be much point in keeping track of those assets on a blockchain.

Have you ever heard of OpenLaw? https://www.openlaw.io/

Court systems, even traditional ones, can interact with Ethereum. At the end of the day, Ethereum is just a ledger. We humans are the ones that enforce laws and social contracts, Ethereum just helps with the (automated) bookkeeping.

If you want bookkeeping where entries can be rewritten by designated parties, then why would you want ETH / distributed consensus? What does it give you in that case over the existing database with a public mirror?

Also laws change. What you signed in an ETH contract today may be completely different than what's legal / possible to enforce tomorrow.

Because you trade and automate assets through contract logic. The benefits of contract composability on Ethereum mean that the velocity of money increases because now assets can be manipulated by logic without an intermediary. So if someone wants to borrow your asset, you can deposit it into a contract and now can lend it out peer to peer, and have interest acrue on an ongoing basis. Assets can be more easily "put to work". This is exactly what banks do with your money actually, only with Ethereum it's easier so liquidity / velocity is greater with assets because they can easily move around. It needs to have decentralized consensus because otherwise it's not credibly neutral.

If a law changes and affects an on-chain asset, then that logic will need to be reflected on-chain, otherwise the involved parties won't come to agreement in the real world. There are ways to make contracts upgradeable on Ethereum while still preventing someone from stealing funds, like through a multi sig wallet, perhaps with lawyers holding some of those keys. It all depends on how it's structured, but the benefits of using Ethereum (or something like it) are clear.

You keep saying "asset" as though this means anything. Say my asset is a bulldozer.

How is an automated ethereum contract going to lend it out and ensure its return in good working order, or pursue damages if it is not?

Say my asset is actually just a lump sum of regular US dollars, which I would very much desire to be returned to me as US dollars plus interest so I can my US taxes with them at a later date. How is an ethereum contract going to actually ensure I get my US dollars back, or have resource to pursue them, seeing as how no mechanisms of US dollars are dependent on ethereum?

The asset won't be the bulldozer, but ownership of the bulldozer. How did the natives of the Yap islands know who owned which Rai stones? Through social contracts. The same would be the case for bulldozer ownerships on Ethereum. It's just a way for you to prove to other humans (or programs) that you own the bulldozer. If you sell the bulldozer in real life, then presumably the buyer would want the ownership. The difference here is where the ownership data lives, not necessarily who issues it.

There are stablecoins backed by USD reserves, like USDC. Again, the ethereum contract is only a ledger. The people responsible for giving you USD is going to be Gemini who control the supply of USDC. You having proof that you own USDC allows you to withdraw USD.

There are of course stablecoins that are not backed by USD, but rather backed by ETH directly and the USD peg is maintained through arbitrage, oracles and control systems implemented in the contracts.

> There are stablecoins backed by USD reserves, like USDC. Again, the ethereum contract is only a ledger. The people responsible for giving you USD is going to be Gemini who control the supply of USDC. You having proof that you own USDC allows you to withdraw USD.

This still depends on trust. The blockchain doesn’t verify the backing. And USDC’s attestation is rather late.

Well, yeah, it's a centralized stablecoin. The advantage is that it can be used in Ethereum contracts in DeFi. If you want a stablecoin with no trust assumptions (other than the protocol and governance), there's MakerDAO's DAI.

Except you keep talking about automation of assets but you haven't answered the question: how does the delivery, and return of the bulldozer work?

How does the delivery and return of my USD work?

At every junction the answer is "well you trust another party and..." - so why is ethereum needed in the process at all? All of this is just companies providing an API for a service (which generally they don't, now, because it's complicated to orchestrate such a thing).

Ethereum is not contributing anything useful here, because everything important is "trust this person" - at which point I'm really just "hiring a lawyer".

Your bulldozer would need to have a chip installed that can connect to Ethereum and read off who the current authorized operator is. The operator and the owner would have to have cards that contain keys that speak a protocol that the bulldozer understands. Once the loan time runs out, the bulldozer locks out the renter.

The GP is describing a system kind of like Zipcar - you go online, you enter payment, and Zipcar allows your card to operate a car for a period of time. So, you might say, so what, we already have a Zipcar, why replace it with the blockchain?

Because if Zipcar goes out of business, all the cards and hardware on Zipcar cars are defunct. If all the hardware talks to contracts on Ethereum, there's no Zipcar to go out of business - you buy the hardware once, but the operation of the system happens on Ethereum, not in Zipcars' SQL database.

If we're after velocity / speed of movement, why not just add APIs to existing services. Changes would be immediate and required setup would be so much simpler.

Why do I want my contracts publicly accessible on a blockchain? All else equal, I specifically don’t want that at all

You can use zero knowledge proofs if you really want to conceal the information in a contract, but still prove to the world that you've fulfilled that contract. If you're using public Ethereum, then presumably you want your contract to be public.

Reply on news.ycombinator.com