Blockchains offer democratized access to programmable money, and you think this is a BAD thing? Where's your creativity?
Second, it's not really democratized if only the rich can afford the transaction fees.
Third, what does "democratized access to money" even mean? Does it solve the problem of poor people being unable to access financial services? Not that I've heard. I don't know anyone who doesn't have access to a bank account but is able to store their money on the blockchain. Does it mean something else I'm not thinking of?
As for the rich affording tx fees, maybe a replacement for daily cash isn't everyone's use case? Maybe it doesn't have to be bitcoin? It can be one of many other cryptocurrencies that has low tx fees. There are places in the world where the volatility of crypto looks stable in comparison to the local geo-political and financial climate.
Cryptocurrencies offer the world a "splinter economy".
Having said all that, of course this stuff is not without issues that need addressing. Regulating this technology into oblivion isn't it though.
This has nothing to do with cryptocurrencies, blockchains, or "democratized access" at all. What you're suggesting is simply for people to use foreign banks. If your local money is being destabilized by war, I can't see why you'd want to put your money into an extremely volatile offshore casino, which is what cryptocurrency is.
I don’t trust banks, they have robbed me my entire life. Have you ever interacted with foreign banks?
I know the usefulness of state-free money. I’ve lived it. You are just trying to worship at the feet of Authority.
- Cryptocurrency is not state-free money. Among other things, it requires functioning infrastructure, stable electricity and internet available at affordable prices. These things are provided by the government everywhere on earth.
- Cryptocurrency is not authority-free. Actually, you're trusting several authorities any time you interact with any blockchains.
- I'm not denying you got use out of cryptocurrency. I'm sure you did. At first glance it does appear to be some kind of functioning financial system, but it is not. A lot of other people have also lost significant amounts of money with it.
Which authorities? I signed a tx, sent it to the swarm using free and open source software, and it was included in a block. Trustless. No authority.
I’m sure lots of people gained and lost fortunes. It’s fine. The trade off is worth it.
>Trustless. No authority.
This is very, very wrong. It's another one of those marketing lines repeated by blockchain companies that is blatantly wrong if you look into it even just a little. At minimum, you need to trust the "swarm" that you just mentioned. It's effectively acting as the authority and you're trusting it to make the right decisions. And if the swarm goes away, you can't make your transactions anymore; the value of your tokens will drop to zero.
>The trade off is worth it.
To this date, no one has been able to explain to me clearly what this trade off is. "It's trustless" is not a trade off, that's not communicating what the actual benefit is. And it's also just wrong.
The swarm isn’t going away. It’s grown a lot in the last 14y.
You don’t get it because you DONT WANT to understand this. You keep talking about censoring and governments and trust. You can’t accept it because it is.
And you have to trust that the swarm will not drop your transaction or devalue your tokens through various means that they have available to them.
>The trust we have is the trust in math and physics
That makes no sense. The "math and physics" you describe are specific equations that were chosen by the swarm operators to ensure their own profits via block rewards. The swarm can change that math at any time by changing the protocol, and they have already done so several times. You don't get to decide what the math is or whether it's favorable to you, the swarm does, and you're trusting them to keep doing it that way. They are quite literally acting as the sole authority to the system; most bitcoin users are not ever going to run a full node.
>The swarm isn’t going away. It’s grown a lot in the last 14y.
I should remind you, past performance is not an indicator of future results.
>You don’t get it because you DONT WANT to understand this.
I understand it very well. What you have been told are marketing lies. If you actually inspect the system you'll see that they're not true.
The Bitcoin difficulty equation has never changed. The math has not been changed. We have newer tx formats, and a newer signature scheme. We also have complete backwards compat.
Do you really understand this?
Actually they can, they can technically just print more BTC by changing the protocol. Also I should remind you, Elon Musk (who is not even a miner) can devalue your token just by making a few tweets.
>There are always other miners that WILL take the money.
They can't do this if the other miners force a protocol change through as their blocks will start to get rejected, the only option then is to fork the chain.
>The Bitcoin difficulty equation has never changed. The math has not been changed. We have newer tx formats, and a newer signature scheme. We also have complete backwards compat.
This doesn't matter, the point is they have the ability to change all of it. Look at any of the bitcoin forks, this has already been done countless times. Saying "this will never happen to BTC" is certainly an opinion you can have, but it's not one based on any kind of objective "math and physics" reality of what they can or can't do. It's an opinion based on trust that they won't change it. You're trusting them to be the sole authority over the network.
>Do you really understand this?
Yes. Do you understand that all distributed systems have weaknesses and constraints, and are subject to change by their operators? Blockchains are not special here. Please don't trust anyone who designs these kind of systems and isn't forthcoming with a full description of the pros and cons.
I also know history, probably better than most on this board. This conversation is about trying to find the crux of your disbelief.
The thing is, you and Bruce are not being original in your arguments. Some of the things you have said are absolutely undeniable the truth. I am saying it doesn’t matter. Nothing you have proposed is existential for an internet protocol, you are throwing gotchas that we mostly disregarded years ago. Sometimes, In practise, worse is better.
I should remind you again, past performance is not an indicator of future results. The history might give you clues, but it can't point you to a guarantee of what will happen.
>This conversation is about trying to find the crux of your disbelief.
If you have an interest in being reasonable, I think you can see how this statement is total nonsense. I don't "believe" or "disbelieve" in anything, this is just the reality of the situation. If you're trying to get me to "believe" in something, that suggests you're putting trust and faith in them and you want me to do the same. A "belief" would be if I was making predictions of when BTC will collapse, or if I was saying it will never collapse. We can guess, but no one can know that for sure.
I certainly do hope it collapses, because it is actually a giant fraud based on nothing. It has no value, it has no fundamentals, it is based entirely on the "belief" that you will be able to dump the coins on someone else some day. Yes, I know that government-backed fiat dollars are also technically like this, those are at least based on the local economy remaining stable, the economy that (unlike any cryptocurrency) is absolutely required to keep your farms and food imports running if you personally want to not experience mass famine and death. If BTC collapses, you can't get your money out because it's worthless; if your local economy collapses, you will have a lot worse problems than not being able to take money out of the bank. And no, you cannot remove the need for a local economy by forcing people to transact in cryptocurrency, businesses will just not transact on markets that are too risky for them.
>you are throwing gotchas that we mostly disregarded years ago
They were not disregarded for any real reasons other than the opinions of the BTC miners and the developers of the protocol. Actually a great many people disagreed with their opinions and thought they were wrong to disregard them, hence the existence of bitcoin forks, and all the other crypto coins that aren't BTC.
I unfortunately understand the BTC maxi attitude, but it's not even consistent with its own world; the goal appears to be to dismiss all the other coins as "shitcoins" for disregarding certain issues with the network in favor of profits, despite that BTC has exactly the same fundamentals and also disregards a lot of issues with the network in favor of profits.
But since then, I don’t leave enough fiat with banks (including US) banks that they are in a place to rob me.
I trust in ECDSA and Schnorr signatures about 100x as much as I trust FDIC.
Agree, there is risk for the 5 minutes it takes to transfer the coins out. If you are on boarding from fiat, there is a degree of trust to extend to the exchange. But this is not Bitcoin, it is a centralized exchange. There are other ways to buy and trade coin too. Earning is best.
I knew not to leave coins with MtGox. I knew not to leave them with Cryptsy. This is a lesson I learned from banks.
Can you elaborate how a bad actor, any bad actor, can confiscate, steal, reorder or devalue a UTXO recorded on an immutable blockchain for all eternity?
The reality is most people will not do that as it is a massive PITA. You can observe this right now.
>There are other ways to buy and trade coin too. Earning is best.
That's even worse, the coin can become devalued in between the time you started the work and when you get paid.
>Can you elaborate how a bad actor, any bad actor, can confiscate, steal, reorder or devalue a UTXO recorded on an immutable blockchain for all eternity?
They don't have to do that. They can use any number of other techniques to stop you from transacting. Or they can just lie to you, gain your trust and then scam you into giving up your coins, as seems to be very common these days.
I will not accept that people consider it a PITA. I will teach them, personally if I have to. I have onboarded many.
I get what you are trying to say, but I counter it by saying the same amount of Bitcoin sats are associated with the same address it was sent to. No haircuts, no confiscation.
Check history. I think you will find folks that bought BTC to avoid a Cyrus haircut are quite happy today. Nb: I was only tangentially referring to Cyprus. I am from another place.
But its worth noting that the current rate of inflation for BTC/ETH is far higher than any of those countries.
Another way of framing it is that crypto currencies are less stable than a currency from a country that is actively under attack from a nuclear superpower.
Really hope you don't get a concussion on your way out of that warzone!
It also means if I know your 24 words I can take your life savings and you'll never be able to get it back. Which means I can coerce you as you cross the borders as a refugee and take everything.
For at least the past year, average fees have been below a dollar, and less than five cents if you're willing to wait an extra 30 minutes for a confirmation.
All I see are scams, hype, and tricks to get marks to stuff more money into the pockets of bad actors, followed by thievery.
Being creative is often fine. Being creative when you're ripping people off for billions of dollars is not fine. Our culture may respect and admire talented criminal underdogs like art forgers and counterfeiters, but we still put them in jail.
1980s penny stocks. 1995-2005 Enron creative accounting. 2008 subprime mortgages. 2017-21 crypto ICOs and DeFi.
Maybe we don't need any more ultra-creative capitalism, but better regulation and shared financial digital commons where interoperability is guaranteed by government mandate. The EU has been quite successful in making Eurozone cross-country banking just work for the ordinary consumer and small business.
After all money itself isn't the point, the business it enables is. Money should ideally get out of the way and not make you think about it, but crypto so far has taken the opposite approach where the money itself is everything and nothing is actually being traded.
If someone wants to trade Bitcoin peer-to-peer for cash 2010-style, that's fine by me, it won't create systemic risks.
I'd like to see how this is economically feasible for crypto.
They are not, compared to banks and brokers. They do all kinds of things that would be absolute no-nos in regular finance, like trading against their customers.
Bitcoin doesn't do anything useful at all. It's a net negative for the earth and the public at large.
The idea that crypto is a hedge against inflation is laughable, look at any of the price activity in the last few months. Crypto tokens have no fundamentals or inherent value or anything. The price is completely random.
When compared to world currencies BTC currently has an inflation rate that makes it the second most inflationary currency in the world after Venezuela. As a store of value crypto is not great.
If you're factoring in the price, over the last decade, it has been one of the best (if not the best) performing asset, so I think from that perspective it's actually deflationary.
Inflation is a measure of how much goods and services you can get for a given unit of currency. It is not a measure of how much currency exists, although it can be affected by that.
My math is that you need three bitcoins to buy what one bitcoin got you 6 months ago. That is an inflation rate of 600% per year. The world is losing its mind right now because good currencies are inflating at 8% instead of 3%.
On the whole, yes bitcoin is a high reward investment, if you bought it at the right time. It tends to inflate and deflate pretty wildly.
All that means is that, according to most economic consensus, it is a very bad currency. Deflation isn’t a good trait in a currency since it incentivizes saving over using capital to create economic activity. Deflation also tends to favor those who have money, and makes borrowing money a bad idea, which also suppresses economic activity. Massive inflation is bad too, for obvious reasons.
You want your currency to be predictable and stable. A slight amount of inflation is, by conventional economic standards, a good thing.
A deflationary currency (like long term bitcoin) is great personally, since why wouldn't I want my money to be worth more tomorrow than it is today. But in the macro sense, we really don't want that. If my personal money is worth more as each day goes by, my incentive isn't to go out and spend it on useful economic activity. The incentive is to hoard your money and spend as little as possible right now since things will get cheaper the longer you wait to spend. Deflation is a situation where the rich get richer by doing nothing.
So from a societal perspective a currency that deflates over time, like bitcoin, is a currency that discourages spending, discourages economic activity, and concentrates wealth into the hands of those who already have large reserves of capital and don't invest it into new ventures.
Bitcoin might make a good investment, as you pointed out it is up 1000x in 10 years. But that volatility is what makes it a poor currency. That rise was unpredictable, and for every huge deflationary period (price rise), has had an almost as big inflationary period.
No foreign exchange required. It is decentralized so no need to exchange it with any 3rd party.
Flat transaction fees. You can transfer $1B of value to anyone in the world for a buck. How else would you do that?
Theft protection. It's as safe as you want to keep your private key, you can even use multisig to get other people involved.
Privacy. There are many methods to make it anonymous, untraceable so others don't know you own it, how much you own, or what you spend it on.