Despite the click-bait title, the article makes valid points which are very often overlooked or downright ignored by hardcore bitcoiners. As someone who's been watching bitcoin for the past few years, this is in my opinion the plain reality.
What does a scammer selling unlicensed shares in porn production have anything to do with the success or failure of cryptocurrency? Bitcoin was simply the method of payment, nothing more.
That example is immediately followed with the eBay + TicketMaster examples and the importance of centralized reputation/trust. The leap is then made to "...drug dealers establish reputation through their PGP key or BitCoin address". Ok, an objectively factual statement. The author proceeds to go off the rails with the assertion that only criminals value decentralized trust. Please.
You know why I would prefer a decentralized trustful solution like OpenBazaar? Because eBay bends me over with fees. In fact, they double dip. And there's nothing I can do about it.
It's not about illegal use cases. It's about empowerment of the individual over seemingly insurmountable institutions. The author is having the wrong discussion.
This is a problem a trust-less system wouldn't solve, inherently. The real problem is ebay lacks competition.
>It's not about illegal use cases. It's about empowerment of the individual over seemingly insurmountable institutions.
Again competition. You want people to have the power to compete, and have options.
>The author is having the wrong discussion.
Yes you are. None of the problems you listed are solve by decentralized trustless systems. Their consumer service problems. Which any company, or system can have.
:.:.:
Ultimately you commit the same sins you argue the blog post commits.
Actually, the article doesn't set out "to prove cryptos won't be huge," and ends on a crypto-positive note:
> Bitcoin has shown us the promise of blockchain technologies despite its design shortcomings.
> The future of the technology will probably evolve towards a model that more resembles real world needs, rather than the needs of “cyberpunks”.
To diverge from the article a bit and respond to your final point, I don't know that the mantra of individual empowerment in the Bitcoin world amounts to anything other than solipsism. Bitcoin, as far as I can tell, ignores structural biases preventing people from accessing the cryptocurrency. We can see evidence of this in the "Bitcoin in Africa" startups, which on the surface seem benign and even benevolent, but are hiding an uninterrogated colonialism: their chief assumption, it seems to me, is that the developed world will always control more of Bitcoin's limited resources, and the value of spreading a small portion of those resources to the developing world comes from lock-in. It's a classic unfair trade agreement, and it doesn't take much thought to see how problematic this situation can become.
eBay can bend you over with fees because they control the market; Bitcoin's limited resources are susceptible to the same kind of market control. That's the discussion I wish more people were having.
I wonder which group might be in possession of the right idea, the group saying "you don't have to use it if you don't like it" or the group that is already forcing the new currency to be under the same democratic rules of the old, "democratic" currency.
Statism, ideas so good we have to force them on people.
Another huge difference is that anybody can become a new agent in Bitcoin. You just buy the hardware. You cannot influence or join eBay in the same way.
With respect to fairness, what's important is the characteristics of the framework within which the resource is used, that enable rent-seeking. With Bitcoin, each individual is their own bank. They control their own private key, meaning access to money is not intermediated by rent-seeking third parties with their lock-ins and closed networks.
Mining is ultra-competitive, because there are no barriers to market entry to the open mining network, ensuring transaction fees are driven down to the maximum extent possible. The algorithmic money supply ensures that no powerful organization and its host of satellite institutions can inflate the currency on a perpetual basis, to slowly the tax the people over generations.
Any way you look at it, Bitcoin is a force for distributing power and control, by eliminating the roles of rent-seekers.
Isn't that why established players will mostly prefer not to use decentralized currency? Won't the network effect always relegate things like Bitcoin to the fringes?
Look at Amazon and Overstock. Amazon doesn't need to implement Bitcoin to be successful, but Overstock was able gain some market share by accepting it
Because it demonstrates dramatically that one of the main purported advantages of bitcoin (its "trustless" nature) is comically false. As you say, bitcoin is just a payment method, and contrary to what its advocates claim, it does absolutely nothing to prevent shady scams or eliminate the need for good regulations and strong enforcement.
The very nature of Bitcoin lies on the assertion that no individual is trustful, and that a trustful network can arise in which no individual node is trusted.
The blockchain allows us to verify that a particular operation has occurred. For example, the blockchain will verify that a particular address owns 1 BTC, or that 1 BTC has transferred from one address to another. It provides reliable, verifiable unit of account without relying on any one actor to be trustful.
The blockchain absolutely does NOT verify that a person won't lie to you to get your money, or that they won't blow it all in casino once you send it to them. That would be an unbelievable miracle, as it would require knowledge of the future.
No rational person has ever claimed the blockchain will prevent scamming. Quite the opposite in fact.
> 3) No fraud or charge-back (from a seller/business PoV).
> 13a) Potentially, because of the profit from no fraud and the deflationary nature of Bitcoin. Vendors will realise they can lower their prices for Btc purchases. And when inflation ends, due to no fraud, they will still be able to have lower prices than competitors.
Fraudulent chargebacks are a legitimate concern for sellers, and I assure you that loss is reflected in the selling price you and I pay. 13a asserts that if a vendor is able to eliminate the chargeback problem through bitcoin use, then the savings can possibly be passed on to consumers.
What's insane about any of that? You're not comprehending what you're arguing against.
> No fraud OR charge-back
Strongly implies those to be two different things. You write "Fraudulent chargebacks", talking about a single thing, a specific kind (fraudulent) of chargeback. You also neglect to mention that bitcoin eliminates fraudulent chargebacks by just not having chargebacks at all. Which is a bit like celebrating North Korea eliminating voter fraud.
This kind of thing is everywhere in the bitcoin community: Make absurd, grandiose claims ("be your own bank!", "bitcoin is the future of money", "totally decentralized!" [except for the giant central ledger of all transactions]). And then whenever you get called out on it, you'll retreat to some more limited, defensible argument, and claim that's what you were really talking about all along.
There's a name for this kind of rhetoric, it's a "motte-and-bailey" argument: http://philpapers.org/archive/SHATVO-2.pdf
It's a bit disturbing.
Ninety percent of opinions are crap.
However, that's not a valid criticism. BTC functioned only as the method of payment. You can't criticize the future utility of a technology based upon how someone has misused it. If that were the case, we should ban the Internet.
When evaluating and discussing any technology, you're absolutely right: it is unfair to criticize it based on a few bad examples.
However, it is fair to look at a technology and consider whether the "legal" outweigh the "illegal" ones, and if not, why.
The author makes this point succinctly.
I think this is a group that is highly sensitive to face value of statements people make and when someone makes an uninformed remark, their entirely argument is cast aside. Dissent is welcomed, but it needs to be backed by a solid justification.