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Comment by zaptheimpaler | Hacker News Reader

With the amazing new technology of cryptocurrency, you can now give money to people you don't know with no legal recourse in case they rug you or funnel the money to criminals, yay!

Governments developed KYC laws beginning in the 2000s so that banks wouldn't inadvertently help criminals by laundering money or providing access to capital.

Vancouver is a city dealing with crazy housing prices and a fentanyl drug problem because of illegal money. The government is moving in precisely the opposite direction to the article - to require listing the beneficial owners of land[1], again to expose organized crime and prevent money laundering. Requiring real names is a feature, not a bug.

[1] - https://biv.com/article/2021/12/why-are-bc-institutions-hidi...

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I think it's an interesting topic. Rather than lumping the author in with criminals and scammers, who would of course love nothing better than to take money from naive people (anonymously or not), try to identify what it would take to make you trust a pseudonymous organization or identity. For example it needs a track record you can validate. Valuable real-world holdings or a business or something else you could take legal recourse against. One certainly wouldn't give anons with nothing but an idea a million bucks quite so readily as people with real identities. But then part of the reason for that investment is the verifiable resume showing skills and experience in the right things. So you'd need some alternative that is similarly confidence-building in some other way.

> try to identify what it would take to make you trust a pseudonymous organization or identity. For example it needs a track record you can validate. Valuable real-world holdings or a business or something else you could take legal recourse against

Again, we already get all of this with real names and the existing legal system. This is really what a legal name is! Its a "pseudonym" but with enough linkage to the real world that its costly or impossible for someone to abandon it if they do something bad. Why not try to think a bit more about what systems already exist and how they help us before cheering on a new way to reinvent them poorly? I'm not suggesting the author is a criminal, all im saying is we as a society have always needed to build systems to prevent criminals from taking advantage of them, because they will. We all use email providers that block spam and sign contracts for jobs/rent too - its not because i think everyone who emails me is a scammer, its just that some are and this necessitates making the system resilient to them.

Because this isn't an article about the current systems of legal identities, it's about pseudonmys. Identities come with their own hangups and prejudices. I can't help noticing we both are both posting behind pseudonyms.

Would you give a sizable amount of money to someone you don't actually know?

Remember that one person can have multiple pseudonyms and that a lot of real life proof of existence or work cab be crafted to fool a typical person with a lot of money.

People have ran cons in real name, and succeeded. Given pseudonymity not linked to any real assets (unlike a company), it's even easier.

Heck, someone can claim to be a given Nym while not actually being that person, blockchain does not link Nyms to a legal person, and neither does any DAO known to me. The only proof would be paying gas to whoever tries to strike a real life contract off a big account with visible history. And even that can be faked if you're diligent enough and hunting for whales. Good luck fixing it.

If a government backed a DAO and had some link, there goes pseudonymity but you also have some legal recourse.

> Given pseudonymity not linked to any real assets (unlike a company), it's even easier.

A pseudonym can be linked to a company with real assets. I don't follow you here. I even referred to such a situation above. As did the article.

To answer your easy question, yes I can easily imagine scenarios where I might give a sizeable amount of money to someone that way. I have an online business and people in distant countries who don't actually know me give me sizeable amounts of money. They have my webpage which looks legit and demo software which works. There's no magic identity ingredient here to protect them. They'd move on and deal with someone else. There's a risk of course in everything. You certainly shouldn't risk money you can't afford to lose.

Now as for giving out something like seed funding, this is where it actually does start to get interesting. As I also said above, and as the author of the article also says, one needs some kind of data trail to build confidence. No you certainly shouldn't implement your due dilligence in a way that can be easily hacked with ringers or plagiarized code.

So should we not evaluate the new system by comparison to existing system? Is the crypto version just better because its new? brb gonna rewrite my entire company’s stack, they are using old code and old stuff is dumb lol

Re: pesudonyms, yeah pseudonyms are ok for posts on the internet with 0 stakes. They aren’t enough for situations where there is a potential need for accountability. I dont see a contradiction..

No. the new comes with new shortcomings that need to be countered with something extra before you can treat them equivalently to the old. This is what I meant above when I said: "part of the reason for that investment is the verifiable resume showing skills and experience in the right things. So you'd need some alternative that is similarly confidence-building in some other way."

Otherwise I'm just hearing extreme risk-aversion. And a patronizing tone for that matter. I have repeatedly used terms like "interesting" to describe the problem. Since you seem to be devoting a very limited effort towards parsing my words, let me paraphrase for you: that means it's a hard problem. Stop tell me it's hard and thinking you countered my post.

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