Comment by lolinder | Hacker News Reader

Comment by lolinder | Hacker News Reader

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I can't find the original source, but a while ago I read a really compelling article (linked from here) which explained why centralization is inevitable. I think it's relevant here, because if centralization is inevitable then it's reasonable to treat crypto as interchangeable with the exchanges.

Essentially, the thesis was that a decentralized protocol can never evolve and adapt as quickly as a centralized platform, because the protocol has to reach consensus with all stakeholders before it can change. This leaves a gap between user expectations and the protocol's capabilities, which platforms are happy to fill. They extend the protocol with bespoke and proprietary features, these features draw users, and users come to depend on these extensions. Thus, lock in.

You can see this with email and Gmail, with the web and Facebook et al. NFTs had OpenSea, and crypto in general has the exchanges. You can't separate crypto from the exchanges because the existence of crypto necessarily implies exchanges.

https://moxie.org/2022/01/07/web3-first-impressions.html

Yes! That's the one!

> This might suggest that decentralization itself is not actually of immediate practical or pressing importance to the majority of people downstream, that the only amount of decentralization people want is the minimum amount required for something to exist

Seems to me like building a centralized system on top of a decentralized one, similar to my earlier example of building a bank on top of something designed to circumvent the bank

General rule seems to be greed v laziness -> centralization

It's an interesting point, but I think you've stretched it a little thin. Taking one of your examples, I don't think anyone would ever say "it's reasonable to treat the web as interchangeable with Facebook". Sure, for some people Facebook is all they use the web for - but that's definitely not true for everyone. And the web doesn't depend on Facebook existing either. When Facebook dies, the web will be just fine.

Certainly Facebook alone, but that's why I included the "et al". For most of the world, "the internet" is interchangeable with "the few big platforms I regularly use". It's not technically accurate, but I don't begrudge them the usage because that is their internet.

In your analogy, "Facebook et al" seems equivalent to "Binance et al". And OP asked about journalists too. Imagine if CNBC ran an article titled "Facebook fined for privacy violations - is this the end of the internet?" We'd all have a field day. I don't begrudge your grandma for not knowing the difference. But a journalist or HN commenter is expected to know. I wish we held crypto discourse to that same standard of being at least minimally informed.

What about BitTorrent?

That's a reasonable counterexample. I'd say that probably happened because the primary use case for BitTorrent is piracy (I know there are other use cases, but that's the main one), so there was never a space for a legit business to form. Crypto had speculation, which was less obviously illegal than downloading pirated TV shows and provided a great revenue stream to boot.

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