Comment by ObserverNeutral | Hacker News Reader

Comment by ObserverNeutral | Hacker News Reader

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ObserverNeutral

> Bitcoin is open source

Bitcoin is open source, all right. But the first mover advantage and marketing campaign that it has...well it's insurmountable at this point.

> Problem is that is still centralized

The world doesn't give a damn about that. The only killer app of decentralization as of today is the ability to give people peace of mind that the unit of account they use to store their wealth cannot be tempered with by anybody.

Literally the only application of decentralization was the ability to avoid the ever present threat of money printing because people are scared of inflation and rightfully so. Ever since the stone age people have been diluted by the the central currency authority, it's a fear that is deeply rooted in our brains.

People aren't similarly scared about Paypal or Visa processing their transactions.

Fear is the greatest motivation and fear of inflation is the only thing giving the decentralization thing any market. Everybody , ranging from the supermarket employee to Stanley Druckenmiller...they are all scared as hell about inflation.

And it shows in the marketcap and price of king BTC

BTC gives those 7 billions people a way to express such fears in the market whereas they could only buy Gold, Silver, and Inflation indexed bonds before BTC came about.

>>The only killer app of decentralization as of today is the ability to give people peace of mind that the unit of account they use to store their wealth cannot be tempered with by anybody.

Being able to use a tamper-proof currency in financial applications that are decentralized means one's holdings of that currency remain tamper-proof even when they are employing them in financial applications. That is the value that Ethereum's smart contract functionality provides.

> financial applications

Legacy financial applications are fine. People who are afraid of inflation just convert BTC>USD the sole amount they need to use the financial application and that's it.

Also DeFi apps are very illiquid and extremely complicated to use.

Finally let's not hide the truth: 99% of financial apps are based on loans. Crypto loans are doomed because people don't want to borrow crypto as they anticipate huge appreciation and such appreciation would leave them in a hole financially speaking.

Also without an identity system a borrower can just steal crypto, and never pay back interest or principal

Also the lender requires high interest to separate themselves from their crypto considering how novel is the system and how frequent hacks and as I said people outright fleeing are.

The most successful crypto loans are the ones denominated in USD and happening on centralized platforms (and those crypto never leave the platform as they are used to short)

>>Legacy financial applications are fine.

They are not at all. Governments and financial institutions can lock funds, do 'hair cuts', as they did in the European financial crisis, and engage in other such shenanigans. They can debank or otherwise exclude people and companies from the payment system, or refuse them banking services at all.

But really, your statement says it all. This is what anti-Ethereum advocacy amounts to: advocating for the legacy financial system, and the one Satoshi Nakamoto specifically criticized, including in the Bitcoin white paper:

https://www.bitcoin.com/bitcoin.pdf

"Commerce on the Internet has come to rely almost exclusively on financial institutions serving as trusted third parties to process electronic payments. While the system works well enough for most transactions, it still suffers from the inherent weaknesses of the trust based model. Completely non-reversible transactions are not really possible, since financial institutions cannot avoid mediating disputes. The cost of mediation increases transaction costs, limiting the minimum practical transaction size and cutting off the possibility for small casual transactions, and there is a broader cost in the loss of ability to make non-reversible payments for nonreversible services. With the possibility of reversal, the need for trust spreads.

Merchants must be wary of their customers, hassling them for more information than they would otherwise need. A certain percentage of fraud is accepted as unavoidable. These costs and payment uncertainties can be avoided in person by using physical currency, but no mechanism exists to make payments over a communications channel without a trusted party. What is needed is an electronic payment system based on cryptographic proof instead of trust, allowing any two willing parties to transact directly with each other without the need for a trusted third party. "

>>Also DeFi apps are very illiquid and extremely complicated to use.

Uniswap had $10 billion in trading volume over the last week. That's in the same league as major exchanges like Bitfinex and Kraken. It's also extremely easy to use, with no sign-up/registration required, and a trade being possible with 3 clicks.

> They are not at all. Governments and financial institutions can lock funds, do 'hair cuts', as they did in the European financial crisis, and engage in other such shenanigans. They can debank or otherwise exclude people and companies from the payment system, or refuse them banking services at all.

All that is signed off and approved by the popultion. In the beginning the nascent financial system which today is labled "legacy" was the wild west as well. Then it was an organic growth of scrutiny because it was demanded by the population. Every megasocial system such as US, EU, China...even North Korea organizes itself based on the population desires.

All those things aren't imposed from above by an omniscent and evil dictator or done in the dark, the Patriot Act is supported by the majority of the population, so it's all the rest.

People accept and embrace the government playing the role of policeman in the financial and capital markets.

You are the fringe minority, and frankly people in the cryptospace lack the pragmatism to understand that they are a fringe minority.

People who are the fringe minority should hide and find holes in the power of the controlling authority and USE THEM AND KEEP THEM TO THEMSELVES opposed to creating mega structures to invite and pursue those who sign off and approve the aforementioned authority. Such attempts will fail because the target demographics is totally onboard with the authority.

> Uniswap had $10 billion in trading volume over the last week. That's in the same league as major exchanges like Bitfinex and Kraken. It's also extremely easy to use, with no sign-up/registration required, and a trade being possible with 3 clicks.

Sure in the ETH ecosystem, tell me again where can I spend ETH or Stablecoins based on ETH? Nowhere.

>>All that is signed off and approved by the popultion.

Same with the central banks that inflate the currency. They are created by the government that the population approves of. You're making a selective argument against the principle of financial self-sovereignty that underlies the entire Bitcoin and cryptocurrency movement, that just happens to lead to a conclusion that decentralized finance is bad, whereas a decentralized currency - bitcoin - is good.

>>Then it was an organic growth of scrutiny because it was demanded by the population. Every megasocial system such as US, EU, China...even North Korea organizes itself based on the population desires.

There is nothing organic about massively complex political systems. They are as artificial/non-organic as anything else produced by modern human civilization. They are nascent forms of human organization susceptible to massive corruption and rent-seeking. Putting all that aside, majority approval does not justify violating people's basic liberties/human-rights, like the right to engage with other consenting adults in mutually voluntary economic interactions. That is true whether you are talking about the US, or North Korea.

>>Such attempts will fail because the target demographics is totally onboard with the authority.

What the majority approves of changes when technology changes. When the social costs of enforcing a particular type of law that limits voluntary interaction massively increases, for example as a result of the advent of widely accessible strong encryption, then the majority will become more opposed to enforcing such laws.

>>Sure in the ETH ecosystem

ETH-based assets will gain mass-adoption soon enough. And when they do, your final plausibly pro-crypto objection to DeFi will have disappeared. All you'll be left with is the argument that cryptocurrency, as a whole, is bad for society, by enabling non-compliance with politically enacted forms of centralized gatekeeping.

At that point, it will be even more obvious now that an argument against decentralized finance is an argument against the entire principle that Bitcoin is based on, and was created to advance.

> Same with the central banks that inflate the currency. They are created by the government that the population approves of. You're making a selective argument against the principle of financial self-sovereignty that underlies the entire Bitcoin and cryptocurrency movement

The fed is non elected. there is a separation between Govt and the Fed

Public cannot vote on the Fed Fund Rate

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