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This was the part I latched onto in Moxie's piece too: "A protocol moves much more slowly than a platform. After 30+ years, email is still unencrypted; meanwhile WhatsApp went from unencrypted to full e2ee in a year. People are still trying to standardize sharing a video reliably over IRC; meanwhile, Slack lets you create custom reaction emoji based on your face."

In the Firefox OS days here at Mozilla, I was a huge believer and advocate for our desire to push web protocols & standards into mobile. But as it turns out, proprietary walled-garden mobile platforms move faster than web standards - who knew?!

But, I like the phrase you used - "hoping for an inefficient market". At this point in my tech career and looking around at what the tech market is doing in the world, I think slowing down and getting less efficient might be good for us?

> The author seems to miss that one of Moxie's central criticisms is that, all else being equal, distributed solutions tend to lag centralized ones.

Distributed crypto offerings do not lag much behind in terms of features, but they are costly and inefficient, which drives most users to centralized solutions.

This creates positive network effects for OpenSea (nft), Binance, Coinbase (crypto trading).

L2 / zk-rollups / validiums have potential to change this balance of power by introducing low-cost, fast transactions.

Which can be achieved by making transaction execution/verification faster through ZK proofs and offloading execution off-chain (without sacrificing security). There is intense competition in the space (zkSync, Polygon Hermez, Starkware, Loopring and others).

Some large players like banks or BaaS companies may create or license their own private rollups.

So far most wallets do not support L2 rollups, I've only heard of Argent supporting zkSync.

This is of course a hybrid solution, not for purists.

Blockchain critics will have fun criticizing it for the next 5 years while it scales. :)

It’s a fair point, but it’s unclear to me to what extent these hybrid solutions retain the advantages of blockchain and to what extent they give them up.

I’m not at all an expert, but I’ve been wondering if a world where we all regularly use Bitcoin, but only via large, centralized L2 networks, would be one which feels exactly like the world of today, except (say) Visa or Stripe use Bitcoin instead of…fedwire? I dunno?…for clearance. And as a user, would that actually benefit me?

> what extent these hybrid solutions retain the advantages of blockchain and to what extent they give them up

Security guarantees don't change, zk-proof will guarantee that your transaction was processed as is (without modifications). The resiliency of a rollup would depend on how it's off-chain "backend" is implemented - if it has good load-balancing, if it is multi-cloud etc.

It's possible that a specific rollup can try to censor your transaction (similar to Visa or Mastercard).

I can see a future where if a specific rollup cannot accept your transaction, your wallet would retry successfully with another rollup or try a censorship-resistant channel to push your transaction through.

Transaction fees being negligible simplify the UX for user, they may not even know there was any problem unless they look.

This is a good post (somewhat technical) on rollups in Ethereum ecosystem and the areas for improvements: https://vitalik.ca/general/2021/12/06/endgame.html

I don't know much about Bitcoin L2 networks, but it makes sense that lots of infra/business logic around that would be implemented by centralized companies (Square, Stripe?). No smart contracts support is a limiting factor.

what would be the time required to add transaction invalidation to the bitcoin blockchain to undo frauduluent transactions?

I have a feeling it's more broadly true that centralization is an emergent property of networks. Webs 3 -> n are no exception.

>but that whenever there's an opportunity to innovate, those innovations will first appear for centralized services.

This isn't really true, though. Even in the example he gave, NFT royalties, they appeared first in individual NFT contracts before they were on OpenSea.