That's like saying each train robbery during the settlement of the west was getting us one step closer to ending the settlement.
If anything these heists prove interest in web3 remains high.
If anything these heists prove interest in web3 remains high.
It is probably both. The model of allowing governance updates from a contract owner on a bridge or rollup is not sustainable and will have to change to mitigate these kinds of risks. Whether that means crypto networks as a whole will inevitably be replaced by a central banking system is harder to agree with.
It's being sold as revolutionary, literally, being able to overthrow $x in power or to the more susceptible as a way for everyone to get rich.
So people who believe in it think it's some grand revolution of freedom, and people against it just see it as scammers exploiting the foolish.
What it actually is going to be is boring. Regulated like the rest of finance, centralized like the rest of finance, but with a few new features which will end up not revolutionary but "oh I guess that's nice". It will also come with weaknesses that older centralized institutions don't have that will seem ridiculous at times.
It should be about as exciting as a new programming language for bankers. Like sure if you're a banking programmer you might think it's cool, but not the kind of thing that'll get superbowl ads or the topic of your uncle joe's podcast.
Snarky comparisons to the Hindenburg aside, I really think things like this disaster in the long line of disasters that won't end is just another blow to the excitement of crypto which won't disappear completely or dominate but become a mundane method for the exchange of value which to the end user is only slightly different than the old ways.
I do think it will, over the next 10-20 years, completely revolutionize how we think about digital assets and digital currency. For the average user it might not be any different than paying with Apple Pay. But there will be other novel applications and companies that emerge from this space much like what occurred in the years after the dot com boom.
There hasn't yet been a killer application besides money laundering and speculation bubbles. It's been long enough and there has been nothing but toy applications outside of people specifically trying to evade laws in various jurisdictions.
The actual applications are just going to be boring.
Holding on to crypto personally for actually paying for things is awful, and worse than cash. Not only can someone take it from me with violence, they can also take it from me because of inevitable software bugs. If there's a centralized account with an institution, it isn't at all different than an account with a bank with dollars. And it becomes easier to see my entire spending history for anybody that sells me something unless I actively launder my money.
The killer application is Ethereum and the ideas it has spawned, including new global financial instruments like stablecoins, decentralized exchanges, NFTs.. and cryptography like zk-STARKs and MPC.
With PoS and privacy enabled rollups this technology can certainly disrupt and compete with today’s popular payment processors in the next few years.
But yes, the most successful consumer applications will probably be boring, like PayPal or Apple or Stripe adding blockchain based mechanisms under the hood.
Crypto can also be used to decentralize control of the gates, such as allowing goods services and taxes to be paid in USDC and DAI, so that there is less need to use a CEX. But there are regulatory and technical barriers that prevent this from happening right now. The people who want blockchain adoption ideally would like to see those barriers to be overcome.
- DEX - sure, new thing. We all see how it works out. This is what, 5th DEX exploit just this year? And I'm talking only about big exploits.
- NFT - literally useless junk build on lies and insane lies. I dare you to name even one area which NFT can improve.
- cryptography - maybe, I don't know. Though I suspect that those developments can be simply self serving for token industry and not really transferable to other industries.
- BigCorp adding blockchain - why though? What would they get by introducing a private, inefficient, slow and not user friendly (users = employees of those corps) data storage? Private BC completely defeats all its small promises about decentralisation or privacy etc.
- all these protocols are beta software, less than a few years old. Uniswap as one of the oldest is probably also the most secure.
- NFT: ability to hold custody over a digital record without relying on a single private company's servers to uphold that. But I expect you will move the goalposts...
- Cryptography: take a minute to look at developments in ZKP, MPC, new signature schemes. Many uses outside of pure blockchain[1].
- BigCorp: because they can extract value from it. If 5% of Shopify or PayPal users want to use crypto payments, the company can support that method and charge rent on it. Or they can ignore crypto, and let another company absorb the potential revenue. But because they like profit, this is why we see Shopify, Stripe, and PayPal all integrating crypto currency.
[1] https://blog.cloudflare.com/introducing-zero-knowledge-proof...
I don't see how digital IOUs is anything novel or invented by tokenbros. Paper or digital, it's the same this essentially.
NFTs... How EXACTLY does NFT "holds custody" of anything? Please describe what do you mean by that.
A practical example of an application on top of this is namespace aliases that are held non custodially by the users through an ERC721 contract - see ENS. The user's private key gives them access to a record within a smart contract, allowing them to update some state or transfer ownership of the data object.
I will clarify my question better now, hopefully. How EXACTLY does NFT "hold custody" of anything not living fully on on the blockchain already? So any physical object, or any digital object outside of cryptotokens and DNS records on the blockchain.
I am not suggesting it does. I am suggesting it allows you to hold ownership of an asset on the blockchain. At this point it means ENS, art, collectibles, loans, stablecoin positions, user accounts, and other assets that can be defined digitally and on chain.
At some point in the future, property laws might change to recognize crypto tokens as their own asset class, which would make possible things like having some claim of ownership over a gold bar based on holding a NFT. Many investors today hold gold in their portfolio without it physically being transferred to them. Instead, ownership of the assets is recorded on some ledger, which could be a public ledger.
Mattereum is working in this space, trying to tokenize gold bullion, wine[1], and recently real estate[2] with legal warranty, but I would not put much stock in this idea until there is more clarity from lawmakers.
[1] https://www.businesswire.com/news/home/20220624005079/en/IG-...
[2] https://www.businesswire.com/news/home/20220731005030/en/Mat...
- art - no
- collectibles - no
- loans - as in "loan your NFTs"? Technically yes, but since NFTs are worthless bullshit it is kinda pointless.
- stablecoins positions - please elaborate, never heard this idea before
- use accounts - no
- other on chain assets - yes
- other off chain assets - no
tl;dr - NFTs themselves lack any ability to provide proof of ownership, transfer IP rights, or hold custody simply because it is technically impossible. Any cadaver constructs which allows this are inevitably an additional centralised systems which do all the actual work and actually store digital data. NFTs are fifth leg in a horse - pointless and useless. (DNS records alone of course don't justify NFT existence)
Loans and DeFi - see Uniswap issuing ERC721 Liquidity Pool tokens.
User accounts - exact same mechanism as ENS, but different namespace specific to a protocol. See Lens protocol for example.