Comment by tremarley | Hacker News Reader

Comment by tremarley | Hacker News Reader

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> With cryptocurrencies, you need to trust: * The exchanges (and other ramps for getting useful money into the system and out of the system)

Decentralized Finance, Protocols and Apps do not require trust.

The frontend and backend of every protocol you are expected to use is open source. Things can only go wrong, without the fault of your own if you use something closed-source or custodial.

Cryptocurrency allows you to take responsibility.

> Which can all be lost or stolen easily without a central authority and a judicial system. Do not underestimate the power of phishing, especially if it is directed towards specific people.

Blockchain gives the world the ability to not rely on the local central authority. Your data will not be edited, removed, lost, stolen or damaged either.

You can write up a contract, leasing me your land for 99 years, on paper, with a witness and kept a copy with the local central authority. This can go well, until it goes wrong.

In 99 years, my estate may refuse to give the land back to you without proof of the paper it was written on. We could claim the paper is a fake. The local central authority can be bias, corrupt or dissolved. Which many authorities are.

If you used blockchain instead of paper. The contract remains unchanged, and ready to read at any time, until the very last computer on this planet is turned off.

> Decentralized Finance, Protocols and Apps do not require trust.

> The frontend and backend of every protocol you are expected to use is open source. Things can only go wrong, without the fault of your own if you use something closed-source or custodial.

Are you seriously claiming that something cannot have bugs because it's open source? That nobody will use an oracle or otherwise have outside dependencies?

In reality, these systems do require trust. Most people do not have the skills to audit everything they use — even if, as we've seen so many times in the cryptocurrency world, they incorrectly believe they do — and the people who do have those skills wouldn't have time to audit everything they touch if these systems ever see widespread adoption. Everyone using them is trusting other parties at multiple levels, and there's no way to avoid that for most transactions.

> Cryptocurrency allows you to take responsibility.

Less misleadingly, cryptocurrency requires you to take responsibility for everything. This is not a feature for the vast majority of people because it's a large amount of highly-skilled work which you're required to do constantly as things update and the failure mode is that you're now penniless.

> Blockchain gives the world the ability to not rely on the local central authority. Your data will not be edited, removed, lost, stolen or damaged either.

This is pure naivety. If the blockchain says I own a house and the men with guns say you do, guess who wins? If your government is corrupt, the blockchain won’t help. If your government is not corrupt, the extra cost and risk from using a blockchain aren’t buying you anything.

At most, this problem needs PKI to register claims but the current system works well and all of the failure modes are things which blockchains either don't help with or make worse (“Someone hacked grandpa's phone. Now they own his house and a bunch of nerds on the internet said it's his fault and there's nothing he can do.”).

Sure the contract remains unchanged, but who will enforce the contract? In 99 years, will there be any authority that recognizes the blockchain contract? The "biased, corrupt or dissolved" local central authority could choose not to recognize the blockchain contract and then your estate would still not give the land back.

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