Comment by tpetry | Hacker News Reader

Comment by tpetry | Hacker News Reader

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What if this new generation is just repeating the mistakes of former generations?

They talk about decentralization which has been done so often before and only worked for niche use-cases.

What if crypto is just a big money pump and dump scheme? It‘s sold to the poor to solve their financial situation which mostly don‘t have bank accounts. But the ones loosing the most in crypto crashes is not the new-generation web3 developer earning a good income. It‘s the poor guy somewhere with a bad local currency which was now using crypto which is now not worth anything too.

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People are always repeating that many people didn‘t e.g. saw the need in the internet and had been totally wrong in it. But crypto isn‘t new anymore like the internet was at that time! Bitcoin is almost 13 years old and Etherum 6! The internet had already shown very good usecases after that time and crypto is still searching for it‘s _one_ use case than money speculation on a highly volatile asset which doesn‘t have any real money.

More interesting what will happen to crypto in a real world economy crash like 2008!

> They talk about decentralization which has been done so often before

What’s an example from earlier generations?

Diaspora and Mastodon. These are the prime example what the web 3 generation wants: no central company, everyone runs it‘s own server, user is in control of all it‘s data

And they are a total empty space. Because it‘s complex to use ans is missing the network effect which is really really hard to get without a central company doing marketing in some form

Got it I see what you mean. In my mind though, the real innovation in web3 is native ability to move money around, and turing complete (ish) programmability. Comparisons to social networks seems like apples and oranges.

It’s not a product that needs to be marketed to end users. Think AWS not Amazon.com. The people building products on it will do the marketing.

AWS does not have any trouble moving money around or writing programs to move money around. Finance has been digitized for ages.

You might say "those are just digital abstractions — this is native." But so what? What does it matter if my money transfer routine talks to a bank or broadcasts a new block? It does the same thing in the end, except that the blockchain version is slower and more expensive.

Blockchain offers no concrete advantages over traditional finance except for decreased regulation. That's why it's so hard to argue in favour of blockchain as a replacement for traditional financial systems. You end up constructing weak arguments, because you can't play to blockchain's strengths.

Let me present the strong argument in favour of blockchain: "Blockchain helps you make lots of anonymous money through pump & dumps, ransomware, and other assorted scams." This is an unethical argument, but a concretely fact-based one. The track record speaks for itself.

Look how much more robust the strong argument is than any argument about decentralization for its own sake, or about the "native"ness of bitcoin transfers. Occam's razor suggests that the strong argument is the driving force behind blockchain adoption, not the weak ones. Nobody cares about decentralization. They just wanna make a buck.

The value of nativeness combined with a totally neutral execution environment is that money can be directly controlled by software, with no practical human override. Suddenly the cost and risk of transactions goes down, as I don’t need to worry about whether I will get paid, or whether the intermediary actually handling the money will arbitrarily decide to freeze my account.

Obviously this is a double edged sword; having no human override is actually a very bad thing for many things. You can code in human overrides of course, but they are transparent to all parties. When you make a bank transfer or a PayPal transaction, it’s 100% opaque. The terms are not truly binding and it can be reverted or altered for any or no reason.

I’m not arguing this is the reason for valuations currently, but I find it pretty surprising how many people can’t or won’t understand the value of a neutral execution environment for financial transactions. It is not something that exists elsewhere.

> When you make a bank transfer or a PayPal transaction, it’s 100% opaque. The terms are not truly binding and it can be reverted or altered for any or no reason.

Yeah, they can tell that to my lawyer. Banks don't make the rules — regulators do, and I can file suit to have a judge enforce those rules. If my money disappears, I can hold my bank to account.

But a judge can't rewrite the blockchain, so cryptocurrency has become a safe haven for fraud. You've got it exactly backwards: It's blockchain-based banking that puts customers at risk of predation.

> I find it pretty surprising how many people can’t or won’t understand the value of a neutral execution environment for financial transactions

If it had value for banks, banks would be using it. If it has value for customers, then tell me: As a customer, which desirable guarantees does blockchain provide me that banking regulations don't?

I’m in my 50’s and not getting paid or having account get frozen has never happened to me during my entire life, and is not something I’m concerned about. If would be cool if defi was solving an actual problem most people have, but I’m still not seeing it.

1. It’s actually pretty common, my PayPal account is frozen for no reason, I would need to send passport scans to unlock it which I won’t do.

2. We aren’t necessarily the target market. Think more large investment / B2B transactions not consumer payments.

But web 1.0 and 2.0 are largely called as much based on what end users did with it and how they interacted with one another. You can't just ignore that vital component in regards to 3.0.

Sorry what do you mean by 1 and 2 being “called as much”? Being called decentralized?

internet 1.0, post AOL, pre dot com crash. You had to roll everything and could even run a server with little fanfare from your home because ISPs allowed you to run your own servers. Now most prohibit or outright block it without a higher tier plan. There were problems with this approach though, spam, malware, etc.

It's only with Web 2 that we became addicted to offloading everything to central providers. Their siren call was too much to resist and now they have all our data. It wasn't designed to be like this, we can just go back but a lot lack the skills to roll the full stack now sans AWS/Google Cloud.

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