I'm increasingly seeing "web 3.0" as basically a two headed beast:
1) a way to part greater fools from their money until the hype has died out
2) a hot topic to drive clicks and discussions for nerds and, increasingly, the tech press, from other more pressing issues that exist in terms of tech and culture and finance
In other words, its a bullshit scam, can we please move on already?
When I was a young engineer in 2006, the marketing about Web 2.0 was in every tender for IT projects, so much that my boss created the “Web 4.3 dev community” in my city to point out the ridiculousness of it.
Every versioning of that idea is marketing speech.
Web 2.0 and 3.0 are not directly comparable just because they have similar names, a fallacy of equivocation.
Web2.0 might have had a silly name, but the idea of the web as something that the average user and company could contribute back to and use to communicate with in real time
provided explicit value and convenience over existing alternatives (letter writing, door-to-door sales, in-person self-promotion, calling a pizza parlor, renting a physical video, long distance phone calls, physical plane tickets mailed to your house…)
It's a way to authenticate yourself without a centralized authority. So right now it's being used to create exclusive communities, access to which theoretically has some value. In the future, there may be application ecosystems which operate solely against your wallet information, no need for registration. Maybe that has some value too - time will tell.
I don't follow the details of the web3 market closely, so not speaking in support or against here.
We've had "auth without centralized authority" for decades, and 99% of people don't care and won't deal with the hassle involved. see PGP, encrypted email, OpenID, etc etc..
The exclusive communities you mention only have value because of the hype and FOMO and high dollar amounts that people see being made on sales of "exclusive" NFTs or some such. Same as many of the many crypto pumps, same as the dotcom bubble, same as tulips. Same as it ever was.
> It's a way to authenticate yourself without a centralized authority.
Can someone provide me with a clear example of this being implemented? AFAIK accessing blockchain from a traditional client(website/app) still requires going through a central node.
Did something change with 'Web3'? Pardon me for not being up-to-date but it's like one day I woke up and Web3 is all over the place it seems like well-coordinated, heavily funded campaign. How else can we explain this seemingly sudden trend of Web3?
I would like to create an online application which people could use by paying for its usage in bitcoin.
I assume it would make the application much simpler because there would not need to be any or very little user-account management, no sending bills or charging credit-cards. Just gimme them bitcoins. The user-state could be stored on the client-machine, unless they especially want to pay for us backing it up on the cloud. Still it could be backed up anonymously, identified by the wallet.
No more hacking, if there were no user-accounts or passwords there would be nothing to hack.
i suggest learning it properly before jumping to conclusions. everything has pros and cons. e.g. cars pollute but would you want to go back to riding horses? judge less, learn more
This is always the defense: “you obviously don’t understand it”. Or, maybe there is a good reason this type of article pops to the top of HN every other day. The skeptics have good reason to doubt the viability of all the hype.
Read the article by moxie on NFTs. It is so poorly designed that a jr JavaScript developer with 6 months experience would be ashamed of it. Don't "Go-and-lean" us. We are technology people here not your non-tech crowd that'll get scared and silenced by "go and learn"
I actually would prefer riding horses if it were feasible and safe in my community, thank you very much =).
I've learned enough at this point to know a scam when I see one, and I definitely don't need to go thru my history w/ software and tech bubbles and cryptocurrencies to explain why web 3.0 is full-on bullshit.
I've yet to see a "pro" for blockchain or NFTs that doesn't conform to the characterization you're trying to dispute. Care to offer one? I'm eager to learn.
I see more and more of this attitude these days: "Stop spreading disinformation. Educate yourself"
A useful contribution would be to point out how exactly the GP is wrong.
I can imagine the current international banking system get upgraded with a blockchain like technology such that you don't need a central bank of central banks.
But the web3 guys simply want to compare detractors to luddites
It's funny how HN is negative towards crypto and web3 (see all upvoted articles on the topic, and related comments). Yet can't seem to stop talking about it.
I get it, you don't like it.
So I agree with your last point: let's all please move on.
I’m pretty much convinced that crypto stuff is a scam. Still, I want to question the mob. We only get better understanding, doesn’t take anything away.
I like hashing things out but whenever there is a huge bandwagon effect, I am increasingly getting more skeptical. Happy to be wrong but we need skeptics that question mob mentality.
There are several recent examples of this: 1) Inflation 2) COVID origins (Lab leak) 3) Zero-COVID policies and lockdowns.
I always question these things - what if we are wrong?
Well as long as there is a lot of tech hype about it we will continue attempting to cut through the bullshit buzz words and point out the good and the bad and the worse.
A few months ago I agreed with her entirely. Tether is an unbacked fraud and NFTs are being front-run [1, 2]. The mid-level marketing Ponzi vibe is crazy. The latency of applications on the blockchain is atrocious. But more recently after learning from and interacting with people building in the space my assessment changed. There is an interesting intersection between tech, communities, and economics. There exists a transparency in the open-source code of smart contracts that will disrupt the current gatekeepers like the internet did.
Certainly, there are problems, but some things will live beyond the crash that is coming and change things in ways no one can be sure of. The internet started in the 1960s and was opened up commercially in 1989.[3] It feels like we are somewhere between 1995 and 2000. The energy feels similar with people trying to shove old paradigms into a new world, vaporware companies, and insane investments. I don’t think we’ve seen the top and it will likely make the crash of 2001 look small by comparison. I may be wrong, but if I’m not, it still is early.
I'm sorry, I'm not trying to call you out personally, but this is itching my brain something fierce so I have to blurt it out, and hey, it's the internet. A little derailing never hurt anyone.
It's amazing to me how universal the "I used to be a non-believer" line is in evangelism. From the classic "I used to be an atheist but I've been born again" to all the members of political party A claiming to have been a member of party B before seeing the light to technological evangelism.
That’s a nice little Kafka trap you’ve constructed to disregard the people who change their minds away from what you think. So every time someone changes their mind and uses their previous opinion as informative you are going to non-committally imply it’s “evangelism?”
Alternatively, what if they simply learned something new which caused them to change their belief in something? It's better to focus on what caused their mind to be changed (it may or may not be bunk) versus focusing on the fact that their mind changed at all (which can certainly be a good thing).
The parent's perspective does not come across as an evangelist's though. Quite the opposite. It's balanced, seeing the hype for hype, seeing the flaws, and yet seeing that there is still some truth and potential buried in there. The world is grey.
You know, it's funny. I've worked in and around analytics for a long time now, and I've had the thought that blockchain enables the following.
1) A common "universal" transaction data source
2) A shared, readable format
So the thought occurred to me that as soon as blockchain apps/currencies became popular, people would want analytics on them. There would thus be a startup opportunity for unprecedented analytics visibility into transactional data from a third party without needing to build bespoke integrations into high security/compliance systems.
If a blockchain backed currency was widely used, a third party could easily estimate the real-time sales flow of every brick and mortar store location. You could have real-time auditing and quarterly tracking of both public and private corporations available from a third party. Asset transfers, smart contracts, and their real world equivalents could be instantly monitored - allowing the early detection of emergent supply chain bottlenecks.
The problem with all of this is that in the 5 years since I had this idea, the only use cases for BTC and other cryptos has been price speculation. The market for such analytics products is effectively zero.
There is no future in third party analytics because any "blockchain" that is globally adopted and used for more than shitcoin speculation will be zero knowledge
Making all their real-time sales data public, and thus available to their competitors, doesn't seem like something most companies would want.
If the blockchain does enable this, wouldn't that just lead either to 1) companies not adopting blockchain, or 2) some solution for hiding the data and defeating third-party analytics?
You were right, blockchain analytics was a great startup opportunity and there are already a bunch of companies, like Glassnode, doing blockchain analytics.
You also seem to be missing a lot of interesting stuff happening with cryptos if you think it's exclusively price speculation.
IMO social media needs competition but I don't think it will be disrupted by blockchain or decentralization. It will be disrupted by a continued pursuit of competition by doing things like supporting net neutrality. That keeps the playing field level and prevents current big players from becoming further entrenched. Big tech's monopolies are encouraged by lower-level-monopolies owned by Comcast and the other internet media conglomerates. To solve the problems higher in the tree we should get at the roots.
It is somewhat disruptive to banks. You can invest stable coins and get interest for example which is higher than bank interest. And the operator doesn't need to spend a fortune applying for banking licenses for each country they operate in.
> A few months ago I agreed with her entirely. Tether is an unbacked fraud and NFTs are being front-run [1, 2]. The mid-level marketing Ponzi vibe is crazy. The latency of applications on the blockchain is atrocious. But more recently after learning from and interacting with people building in the space my assessment changed.
I feel like a lot of the cryptocurrency critics commit the "fallacy fallacy". That is, they have the following reasoning: people believe crypto is good because of X, X is false, therefore crypto is not good.
Yes, there are a lot of people who are into crypto because they think it's a way to get rich quick. Yes, there are a lot of guru technical analysts who sell bullshit dreams on their Youtube channels. Yes, there are a lot of criminals who use cryptocurrency. Yes, crypto attracts a lot of charlatans and snake oil men. Yes, there are a lot unbacked stablecoins and shitcoins.
Given the above, it's easy to dismiss all cryptocurrencies as a scam. But when you dig a bit deeper, you'll find that there is true technical and financial innovation. For me, Bitcoin's potential to be a programmable money without government or central authority is a very powerful idea. The idea that you can be your own bank and do p2p electronic money transfers without an intermediary. That has never been possible before.
I could go on but my point is that even if there are many wrong reasons people like X, it doesn't necessarily mean that X is wrong/bad.
Everyone doing P2P transfer and bypassing traditional banking institutions is a powerful idea... but ultimately everyone needs to agree on a single medium of exchange, otherwise efficient market pricing is too hard.
And it's debatable whether fiat will ever whither and die. The Government will ultimately have to endorse a currency for tax purposes, and they'll always seek to control the inflationary environment so they can maintain a workable budget and keep public services afloat.
Just a century ago or so, banking was only for large corporations. Commoners and small businesses all used cash and exchanging bits of valuable metal was the norm. I mean, believe it or not, we had good reasons to abandon that simpler system in the first place. Things are better now. Markets are more efficient.
No one should be suggesting that 100% of crypto is a scam and that there will never be anything useful in the crypto space. Vitalik seems the be operating with best of intentions and IMO the threat of decentralized money has already effected the central banks in their thoughts around inflation.
My main problem is similar to the original article here. In 2014 Bitcoin was "The future of micropayments" 6 years later and now the narrative is that "Layer 2 networks are the future" It would be great if the crypto people could stop talking about how great the future will be and just deliver what they are promising
>But when you dig a bit deeper, you'll find that there is true technical and financial innovation.
I will give you the technical innovation, but I really have not found anything financially innovative about cryptocurrency. What does crypto do that traditional currencies or payments systems don't? The only thing I see is that it largely replaces the old financial elite with a new financial elite and maybe under the right circumstances reduces fees for transferring money. That seems to be it unless you count circumventing financial regulation as a financial innovation.
Nah, it’s like this: people believe crypto is good because of X, Y, Z, A, B and C. All of them are false, except for C in some odd circumstances. Therefore, the current state of crypto is not good.
> But when you dig a bit deeper, you'll find that there is true technical and financial innovation.
Ah yes. The good old "just google it". There's literally not a single "dig deeper" resource on the internet that explains the need for blockchains/cryptocurrencies etc.
But sure, there are a lot of "innovations" with recursive circular "innovations" (like currency speculation, HFT and flash loans, all of "innovatively made available" by regurgutating the same fatasy tokens and pretending they are worth something)
I have wondered for awhile why the crypto mega-whales in my vicinity are trading USDT at par or better over the last year or two.
My conspiracy theory is that when insiders trade a distressed asset at par or better it’s often a bailout expectation that’s really being traded.
Who has unimaginable access to financing, a “stablecoin” going so/so, and a primary line of business critically dependent on Tether, like, I don’t know, a massive exchange with the highest volume pairs all sharing USDT as quote?
It’s not that hard. When Bitcoin goes down, people like tether because it’s “safe” at $1. So bitfinex makes more tethers and trades them for bitcoins. When Bitcoin goes up, bitfinex sells the Bitcoin and gets dollars.
It’s fractional reserve banking swapped around, with no reserve requirements. The market is the bank.
And because bitfinex is not obligated to redeems tokens for $1 they have no risk. It’s in their interest to keep the market price at $1 because the longer it runs the more money they make but if there’s a run on the currency they can just shrug and go home with their bag of dollars.
The price of things like USDT are effectively set by Tether rather than the free market. If Tether have billions of US$ and offer in the market to buy back USDT at 1:1 then that's what they price will be near enough.
What you've described is metastasized moral risk. We could argue that maybe some risk should be rewarded. But not all risk, such as spending billions in beanie babies as a corporate strategy.
Well, as opposed to hearing "oops our black box implementation of your information got hacked", I honestly don't mind the trend of "read the contract, it is code". Sure it can be misleading, sure it can be intended to trick someone. However, code is law, and even backdoors are "code". Instead we should fix the backdoors so that code can be reasonable "law".
Every time a nascent technology bubble crashes (dot com, AI winter, crypto...) speculation gets reset, scams and projects with no future get wiped out, and the space gets healthier.
And yet you still don't name any actual useful applications!
The Ethereum world computer has 300,000 nodes, and yet has 1/5000 the computation power of a single Raspberry Pi 4.
Except for actual cryptocurrencies, all the "web3" applications could use boring old 1980s vintage cryptography, be just as distributed, and run ten thousand times faster and cheaper.
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So far the only way anyone has ever made any money from cryptocurrency is to sell it to someone for more fiat currency. In fact, in real terms, it has net lost money because of the huge amounts of electricity expended.
So once people such as yourself purchase cryptocurrency, they know in their hearts that the only way they will make more is if further people buy into their Ponzi scheme.
The big question in my mind: is this the internet in 1997 or expert systems in 1982? It could be the next big thing. Or
it could be an interesting idea that was oversold and overhyped, that never really disappeared but became irrelevant as its real value became a commodity that found its way into the software of established companies.
The worrying thing (for me) isn’t which one it is. The worrying thing is that so many people seem incapable of even making a creditable attempt at answering that question and analysing its fundamentals. This has opened my eyes to how many people only think through the prism of “well, this has got really popular lately, and the internet did that too, so this will be the next big thing even if I don’t know why!”. Survivorship bias is very very real.
> is this the internet in 1997 or expert systems in 1982? It could be the next big thing. Or it could be an interesting idea that was oversold and overhyped
...and then returned a few decades later to be oversold and overhyped some more, this time as "Deep Learning" or "AI".
Seems the alternatives on offer are scam or scam. (Or scam, scam, scam, ham, eggs, and scam.)
A nitpick is that [2] isn't front running. Front running is where you figure an institution is going to buy lots of some stock and get a buy order of your own in first, typically done by brokers.
Making fake trades to make the price look like it's going up can be called market manipulation in this case I think. This is also called painting the tape. A similar but slightly different scheme is wash trading where you basically sell an asset to yourself to make it look like that's the price and that there is trading volume going on. There's a lot of this kind of thing going on with NFTs.
> All that to say, a lot has changed in the technology world in the past six to twelve years
It sure has. But not really that fundamentally, since 2009.
A lot has changed in the blockchain space too. Just because you don't know about it doesn't mean it isn't true. A lot of those changes are on par with some of the tech advancements mentioned before my quote in the article. In 2009, you had bitcoin, so basically a distributed consensus workaround that enables artificial scarcity of fungible digital items. Today, you have sharded blockchains, triple entry bookkeeping, proof of stake, blockchains that handle incentivized file storage, alternate name lookup systems, purchasing compute power on an automated order book, liquidity pools (a major, major fintech advancement if you're not familiar with then), arbitrary code execution with a canonical record of it.
It is absolutely still early days.
Because these are decentralized consensus networks, there's inertia. Bitcoin is never going to be cutting edge. Because there's a lot of money to be made, there will be scams. Most of the "cutting edge" isn't cutting edge at all. But there are some real developments happening, allowing novel use cases, enabling very interesting things to be done.
I'm not a fan of the whole web3 concept. I think 99% of the selling points that the charlatans hype every market cycle are nonsense. But a little digging beyond an animated JS bloat landing page (a red flag all it's own) and you can quickly figure out what projects potentially have something and what's bullshit. Or you can do what I do and assume a project is a scam until proven otherwise.
> blockchains that handle incentivized file storage, alternate name lookup systems
It would be a shame if IPFS and Filecoin end up in the dustbin of history if the web3 music stops. They're the only reasonable non-financial applications of blockchain tech that I've been able to wrap my head around to date.
Yep, they're great. I prefer IPFS without the incentive layer of filecoin, but it is interesting to be able to incentivize storage in protocol, and there's obvious use cases. Plenty of people pay google drive or Dropbox for extra storage. Democratizing access to the demand and supply side of that market is pretty cool.
There was a project called Golem aiming to do the same thing with compute, it was pretty cool last time I read about it. Not sure how far along it is, and I'm sure there are other projects aiming to do the same thing.
Well then what's the point of this discussion? The thread is "how has it advanced? How long can you call it early days?" If you just stop reading rebuttals as soon as they're mentioned you're better off talking to a wall, and you'd waste less people's time that way too.
Do we have proof of stake or do we have a lot of bitcoin folks avoiding criticism about the wasteful nature of most chains by claiming that proof of stake will fix all this.
How many coins are actually using proof of stake?
Why haven't the biggest including Ethereum done so?
The same reason Bitcoin doesn't implement every tom dick and Harry's supposed solution to every technical problem. The big boys have to get it right the first time. Again, inertia.
Ethereum does have proof of stake, a protocol called Casper FFG. It is currently live on the Ethereum beacon chain, waiting for consensus to move the entire network to it.
There are lots of smaller projects trying different protocols they call proof of stake too, as well as different proof of whatever they came up with for whatever reason. Most of them are veiled centralization, some of them are interesting for one reason or another. I'm not here to shill networks or coins so I won't be tossing names around.
Right now Ethereum has 9 million ETH deposited on its proof-of-stake network, worth about $30 billion.
That's running in parallel to the main network, which is still mining. Code to merge the two and eliminate mining is currently running on a public test network. Previous upgrades have all taken less than a year to go live after the launch of their public test networks.
Changes in the implementations are not the question. It's application that she's skeptical of. Who has found a reason to use Blockchain for anything other than cryptocurrency?
I actually witnessed one attempt. An actual Fortune 100 built a Blockchain for their public communications. Mostly just an excuse to show off their street cred. It landed with an absolute thud. Nobody cared.
One idea that I am fond of is Nym, an implementation of the high-latency mix network Loopix[0], but with incentives for nodes to act as mixnodes and message providers, using a model in which users pay nodes for their bandwidth. The goal being to provide strong anonymity in the face of a global passive adversary.
I’m not a crypto fan, but I’m not sure what that example demonstrates. A company made an overengineered gimmick just to show off their street cred; nothing came of it, just as they expected, and it was a waste of the engineering. I’m lost as to how this reflects poorly on the engineering technique.
The central problem in this entire debate is two groups talking past each other. The skeptics say "what is it for?" expecting a detailed answer, and the response from crypto enthusiasts is vague and high level; most of what I hear is heavy on words like "revolutionize" and "decentralize" but very, very short on specifics. Or I get argument by analogy to other technologies.
If I heard a single use case where blockchain technology actually created real value in the world, and was better than other alternatives, I'd listen. But it has to create real value, based on the real world and not some fantastical notion of what money is or governments are for.
I think we skeptics want a grounded narrative, and we're stuck hearing a thesis statement and nothing to back it up.
I also find funny how all the fighters for the bright future, peace and rainbows are planning to become filthy rich in the process of making the world a better place. People like Vitalik and Charlie Lee (Litecoin) happily cashed out their coins into dirty filthy USD in 2018 and became millionaires. You remove the chance to become crazy rich and who really gonna stay there?
How about uncensorable donations? For example Wikileaks got blocked by banks and payment processors when they wrote about the war crimes the US committed.
The US could block the banks, but they could never block crypto donations.
Of course there are awesome use-cases, but the real problem of the skeptics is that they can't let go of their fiat.
Take Nano for example: sub-second, 0-fee transactions, of any amount, to any (unbanked) person in the world. Of course, there is no way that any other (fiat) system can achieve this (due to operation costs, regulation, etc)
But the response of skeptics will always be "but I have to convert my fiat money". And at that point, it's not free and instant anymore.
But just because the new system loses its benefits because of backwards compatibility with the old system, doesn't mean that it is inferior. Maybe for some things, you don't need to pass through the old system anymore. One example is mining pool payouts, which can do payments through Nano to get the 0 fee transactions. (see https://2miners.com/blog/how-to-get-payouts-for-ethereum-min...).
You can argue that this mining is all a scam etc, but in the end real value is transferred using the most optimal network. More optimal than any central system that you can think of (remember 0-fee, instant trancations).
> ... but the real problem of the skeptics is that they can't let go of their fiat.
>But the response of skeptics will always be "but I have to convert my fiat money".
Here's a thought experiment for you. Your mother/father/neighbour's entire wealth is converted, at no cost to them, into BTC/ETH/whatever. What is their reaction?
Is it, 'thank god we didn't have to pay those conversion fees!'
The crux of what makes it popular is decentralization which is a fantastic feature and I'd argue the single feature that it has that regular currencies can't ever have. However, everyone doesn't have a wallet and about 60% of all bitcoin is in the hands of only about 10,000 wallets. It's one of those things, if everyone had it then it would work great but because no one has it, it doesn't work at all. In order to get it you need someone you trust to trade you it, which means a centralized exchange, high fees, and slow transactions. However, if you only ever live in a bitcoin or other decentralized coin economy, meaning you never have to trade out of it into another currency, then it can work for you. Say Tesla accepts bitcoin, and everyonjhe pays in bitcoin, it still has to pay it's suppliers who don't accept bitcoin, this means it has to make a conversion to regular currency, adding an additional step, making things slower and less liquid. It's one of those things that just won't work, until it does.
I don't buy this framing for a second. Crypto is popular, I mean actually popular amongst most people on the ground, only because the price keeps going up; with the implicit promise that it will keep going up. Everything else is creative story telling. On-paper benefits are trotted out only to post-hoc explain the growth (which is mostly there from pumping and people seeing past growth) and to pump the coin further. "Decentralized" is only as important as it keeps the "this is still crypto right?" identity in lay-peoples minds that is tied to magic money out of nowhere. Otherwise it can be weakened arbitrarily.
Centralize it and implement something like M-Pesa, or build it on top of the existing mobile networks. The solution is selling standardized contracts to small hold farmers that pay out automatically; the problem has nothing to do with decentralization or trustless transactions.
The blockchain adds nothing here, and creates a layer of complexity that makes it more brittle.
I'm still very opposed to the idea of taking a technology and then searching a problem for it. Why? Back in 2017 during the first hype cycle, blockchain companies raised hundreds of millions with ICOs. I became very interested in the technology too, and some friends still work in this space. 4 years later in the web3 era, there is not a single product aside from trading/finance that got traction. Use cases like storing the history of a car on-chain, transparent supply chains, public voting... this all sounds interesting but never made it to product-market fit.
I always assume that I'm wrong, so I'll keep looking for successful applications and I'm sure you can prove me wrong :)
"Omnichain CEO Pratik Soni speaks to Inbound Logistics about the growing number of blockchain use cases in the supply chain, including in reverse logistics, product authentication and sustainability."
Apparently this company started with the idea that they would use the blockchain to make supply chains more transparent. And they raised money from investors with that goal in mind. But they have since retreated from that goal.
I worked with a retailer that worked with Omnichains. None of Omnichains tools had anything to do with the blockchain. Certainly, we were never given access to a blockchain, nor was it mentioned after we had signed the contract. Instead, we were granted limited access to an API that I believe was run with Ruby on Rails and MySQL. So at a certain point this company retreated to traditional technologies, rather than trying to use the blockchain.
This is one example. At some point I hope to write up some of the other examples that I've seen.
I do not believe anyone will ever find a legal use for blockchains that cannot be more easily served with traditional technologies.
> I do not believe anyone will ever find a legal use for blockchains that cannot be more easily served with traditional technologies.
One does not blockchain to build a product in the cleanest, most efficient manner.
One blockchains to have access to investors/speculators that control the gigantic pile of on-chain wealth that has accumulated over the past ten years, who would never sink $100k+ into a poorly drawn picture of an ape with sunglasses if it was running on Rails+MySQL.
This may sound like I'm being dismissive, so let me be clear, I am not - this is an extremely valid reason to chase this technology, and the existence of these (maybe ridiculous and shady, maybe not) massive stacks of digital cash is going to drive a lot of investment in the space, so if there is anything that can "break through" and prove real value beyond just targeting this wealth, someone is going to find it, likely as a side-effect of targeting these whales.
Web 1.0 couldn't have happened without the late 90s tech bubble, and as ridiculous as the Pets.com era hype was, when the dust settled there was much broader connectivity and a real market for the Internet companies that did live up to the hype over the next two decades.
One big issue is that the largest supply chain participants generally do not want transparency because they make their money on opacity. Transparency attracts more entrants, applicants, and competitors. It is business intelligence that provides important things like pricing advantages. When competitors can see your supply chain, they can do all kinds of stuff to make your life harder and gain an edge.
Almost everyone at every stage in the supply chain have an interest in opacity rather than transparency. The people who may want transparency want transparency for themselves but not for others: they want the equivalent of a one-way mirror to spy through. Naturally, people tend to react with extreme negativity to the installation of such one-way mirrors. Actual transparency is desired by almost no one. This is even true at the consumer level: the consumer may want to know the supply chain information for various purposes, regulators certainly want to know it, business partners certainly want supply chain documentation, but a consumer would balk at the notion that they expose all of their credit card transactions to the entire world at all times. It's always transparency for thee and not for me.
Most of the companies that tout blockchain seem to be doing so to attract free marketing and VC funding. Once they have that the real products seem to use the same old reliable tech that runs the entire internet.
There's selling NFTs of ape cartoons, or selling crypto coins or other imaginary assets.
Rails and MySQL are too transitory for that - you'd buy a record in the database only to find the company hosting the database had gone broke or been bought by Yahoo who closed them.
You buy a bitcoin and you can be fairly confident in a decade or two you'll still have it.
You're missing the point. The goal when you use blockchain is not to more easily serve. It is all the things that don't matter to you until it is too late, like censorship resistance.
> Use cases like storing the history of a car on-chain, transparent supply chains, public voting... this all sounds interesting but never made it to product-market fit.
Anything that does not exist natively on the blockchain doesn't need a blockchain at all.
If a token on the blockchain would represent you as the owner of a car and one day someone steals your private key which represents your car ownership, that person is now the owner of your car. Still, the car keys are located in your house, the license plate is registered on your name and address, the insurance is on your name.
I guess I don't need to explain further how ridiculous that idea is that a token would officially represent you as the car owner.
You're totally off. All those things you said _can_ go on the blockchain including the private key that they could use to start the car. Of course they can sell it for parts...if the parts didn't have private key protection too...
That said, blockchain-like technologies (ksi, more specifically) can be used to assure the integrity of databases storing the relationship between you and your car.
The thing is it's not really particularly good at that. No moreso at least because of any attributes of the blockchain. It's really because of external reasons:
1. Lack of tooling and cooperation for investigating fraud
2. Lack of regulation
3. Programmatic interfaces
4. There are markets like the NFT space that are amazing for laundering
But no part of why it's good for crime has to do with blockchain.
It also enables people to finance themselves despite tyrannical restrictions imposed by bad governments. Using bitcoin I can send money to someone in Chi no a who's social rating was degraded by the CCP and who is forbidden from using banks.
This alone trumps any arguments against bitcoin. Crime will exist forever and criminals will find ways to finance themselves anyway, so the use of cryptocurrencies for their operations is not really a factor.
I had the same experience. The thing that gets me as well is that normally with the rise of new technology you get an excitement that is tangible. Like when the internet first xame around there were emails, multiplayer games via modem, websites. A whole plethora of new wonderful experiences. So far all I've really gotten after doing a lot of research is some good projects and a long tail of terrible projects/websites and a lot of scammers.
It really feels like with the NFT backlash in the gaming world right now that crypto hasn't found its landing and it really hasn't taken off - its kind of in this weird purgatory. Im hopeful but very suspicious at this point. I wasn't suspicious of “the internet” until it was around for a long time. Crypto is past its wave of this is cool and lets build stuff phase afaik and now everyone is trying to make money off it.
In Dubai, buying real estate with bitcoin is a real thing, and by the looks of it also a big thing.
If nothing else, it shows that crypto has succeed in one of its goals: moving money between countries, without being detected/hindered by governments.
I mean, I don't know who buys real estate with crypto, but I am assuming that people who live in dubai and have large crypto values are bullish on crypto, and won't waste it for a low roi investment like realestate. So that leaves rich foreigners who wants realestate away from their own government and I can see them purchasing bitcoins as a way to siphon money out of their country.
Other than that, I am also out of ideas for useful uses of crypto currencies
That is what financialization does. Finance is a parasite that will destroy all potential if given room. To force finance to be symbiotic you must never allow them to control anything.
These ideas are best left in the academy, and then later financialized. The exception to this is internal R&D (like Bell Labs and countless other extremely productive corporate divisions.)
Out of curiosity: How well have significant Bell Labs contributors been compensated? It seems to me that lost of current tech, and even 'future tech' not yet adopted has come out of Bell Labs. But how many of the engineers that came up with said advances settled for relative peanuts? Getting paid $250K for something that changes the world seems... less than adequate.
'Public voting' is not a technological problem but political one. There's a lot of opposition to making voting more accessible to everyone. Voting should be easy, and you don't need blockchain for that but maybe it could help. The question is who wants "voting rights".
Unfortunately, trust in voting can only be achieved with paper voting, there is no technological solution to improve it that doesn't completely remove trust as well.
It was also designed as a pyramid scheme though to drive adoption. This was an unfortunate mistake and that and the inefficiency at scale doomed it as a currency.
Decentralized, anonymized identity is one application. It sounds amazing in theory - and can work for the general use cases of sharing information with corporations. But, I believe it won't really be anonymized, as "data exhaust", "identity touch points revealing identity in aggregate" can help identify.
An example I use, is people expect bitcoin is anonymous. Yes, it is anonymous to the general layperson and corporation - but not to say NSA/FBI for "people of interest". And once bitcoin to USDollar transactions or financial institutions are more common - banks will sell your wallet information to credit bureaus, and eventually corporations will be able to de-anonymize chains for profiling just as today.
I can think of small problems that use blockchain as a solution, but they're relatively niche and only make the game-space straddle the real world, so they tend to be a bit on the vaporware side. Handy, sure, but I'm not sure they are A) 100% necessarily or B) as revolutionary as everyone seems to think blockchain is meant to be =[
EDIT: forgot to say, this could be a complete lack of imagination on my part past what's been done with blockchain already or just my horrible indoctrination into the game-space like some kind of cult =)
It seems you are looking for a product blockchain enables you, but there are activities the blockchain enables which are not products, and are very difficult up to impossible without.
One example is sustainable (financially) open-source project is one I use now. Before that it was always impossible. You get a bunch of people all over the world, many of them are identified only by Internet handles. There's no investment to handle all the legalities of establishing a business, and anyway there's no legal framework for international businesses with psuedo-anonymous people.
But with blockchain we've been using DAOs and online voting tools etc. since 3-4 years now, and it works great. It handles the governance and the finance in a way the traditional system cannot offer.
> One example is sustainable (financially) open-source project is one I use now. Before that it was always impossible.
And yet just like blockchain, you allude to something without providing any substance. What is the open-source project? You’ve failed to actually tell us what the real “thing” is.
You're saying that you wouldn't be able to perform online votes or surveys and remotely send money without a blockchain?
Could you expand more on what functionality that the blockchain provides that the other solutions in this space (online surveys and remotely send money) don't?
How do you comply with compliance and reporting requirements? I would naively imagine that interacting with the financial system/fullfilling requirements for cross border payments etc. are still difficult when everyone is anonymous
Not saying you are doing something wrong but rather that I see a lot of applications in the wild that have to do with people imagining also a different regulatory landscape - which actually is a discussion to be had.
I like the idea that the chain can be used as the source of truth when other sources of truth have failed us. first 15 minutes of this https://www.youtube.com/watch?v=Cwbbxb987vE
Issuing tokens is still probably illegal in both countries I live/work in. Regulatory and tax compliance immaturity are holding back a lot of people besides at the wild frontier or offshore operations with the resources to navigate that
> Back in 2017 during the first hype cycle, blockchain companies raised hundreds of millions with ICOs.
Yes. Those scams have been put an end to by regulations by the SEC, as unregistered ICOs are now illegal since 2017. [0]
> there is not a single product aside from trading/finance that got traction.
So what is wrong with using blockchain domain names like ENS for identity, or sign in use cases? Are we going to look back at this in 10 years time and we will see this sort of adoption? [1]
It's muddy waters. I just heard some guy from a public office saying they used DOT for some specific need (related to managing bonds somehow). And it was before last year boom. It's all very fuzzy
I'm glad someone remembers the (2-year) history. NFTs=ICOs, just another scam to keep "crypto" afloat. Neither ICO nor NFT resulted in anything useful, wait, maybe Bored Ape??
Helium network is an example of a successful blockchain project/application in my opinion. They created the biggest decentralized lorawan network in the world that is used by more internet of things companies everyday. Also they are trying the same thing for creating a decentralized 5G network. It’s still early days for them because I think they started in the end of 2020 or the start of 2021, but they have grown to 490000 lorawan hotspots already. The network usage could be better, but is increasing (saw increased sensor data activity for my hotspot in 2021).
The math for Helium just does not make any sense. Looking at forum threads every gateway makes about $50 in rewards / month. That's $294,000,000 per year in rewards paid out to gateway owners.
Sending one packet costs $.00001 (100K packets for $1 according to their website). So we need to see 29,400,000,000,000 packets yearly on the Helium network for data fees to cover the gateway rewards.
Looking at data from The Things Network - who operate another LoRaWAN network - from their conference last year they mention routing 600 packets/second using 30,000 gateways => that's 630,720 packets per gateway per year.
Assuming that Helium sees the same ratio of packets, and that every packet is unique, and that every packet is meant for the Helium network (and thus paid) this yields an expected (630,720 * 490,000) 309,052,800,000 paid packets => 309,052,800,000 * 0.00001 = $3,090,528 in data fees.
So ~3 million $ in revenue (in very best case scenario) from data fees, but paying out ~294 million $ to gateway owners.
Naturally the only way this works is because they give out their own invented tokens rather than dollars. This does not make any sense, and will never make any sense. I read that the gateway manufacturers pay the Helium company 50$ per gateway (to provision a private key) which probably pays for some stuff (and to pump up their own coin), but if that's the case then it just looks like a pyramid scheme.
Also scale doesn't help if you pay out 100x more for every gateway than you can potentially earn per gateway. But that should be obvious. You're paying a gateway for 600$ and then you get >600$ in rewards per year. This does not make any sense.
Sorry, can you please explain (or give some link) how it is related to blockchain? https://www.helium.com/lorawan doesn’t mention this word
In general, I was under the impression that IoT devices are underpowered for such usage.
Thank you!
I am very curious about these actual users of Helium you refer to. I know there are a lot of nodes (where if you dump money at people--whether by direct subsidy or via circular incentive engineering--to run them that isn't surprising); but I hadn't heard of actual users. Is there any documentation of such, charts of actual usage over time, or articles covering "we adopted this and it was great"?
Do you know of any logistics company that actually uses it? What exactly do they store on blockchain? Who gets to add blocks to the chain? Are those permissioned blockchains? Can a private permissioned blockchain even be called blockchain? How does a private blockchain differ from a centralized database?
That's a very energy-inefficient way of rewarding content creators. Given that most users are going to go through Coinbase et al, it's no different from any of the other similar schemes (anyone remember Flatr?) except that you have a volatile wallet and a payment mechanism that somehow manages to be even more expensive than Amex!
Maybe you could refer to some history more specifically? Are you saying networking technology was developed in advance of a concept of what it's useful for?
Or is it that a global network of networks was a qualitative step beyond simple networking that didn't have a clear justification?
A resilient decentralised computer network -- first realised as ARPANET, which later grew into the Internet -- was a solution to the (at least perceived) pre-existing problem of a military (nuclear) threat to the USA from the Soviet Union.
This is literally how research in the Universities makes it to the world. Spin-offs like Boston Dynamics are essential to building things that may not have immediate use but payoff can potentially be huge. We need to do more of this.
Don’t throw the baby with the bathwater. I really don’t think generalizations of certain jaded experience and then seeing the entire world with the same broken lens does any good. Probably the opposite. We ought to try new tech and keep an open mind.
Before people go off on Boston Dynamics - there are thousands of spin-offs, pick some other charitable example. The point isn’t about BD.
Boston Dynamics is and always has been on a trajectory to build useful products based on technology that is promising. Whether they're going to be successful or not is dependent on financing and time and luck of technology.
Blockchain was awesome technology in 2008, and Ethereum brought very interesting developments. But in the end there's only one thing it can do, and that's be an irrefutable ledger, and for most purposes that are of interest to the common person that is an insignificant improvement on centrally governed ledgers.
Except that university research does not tend to produce that many charlatans and snake oil salesmen. I'll keep my skepticism until this technology gives us at least one useful mainstream thing.
The primary difference is that basic research is conducted with everyone's money -- mostly via grants, and a lot of it in the US underwritten by the federal government -- for everyone's benefit. Even the venture capital industry is largely averse to basic research; they want more Ubers, or companies that can bring University tech to market.
Blockchain? The money flowing in is substantially from retail investors. And that's the problem. This is why we have regulations.
From my very (admittedly very inexperienced) perspective, both views here are valid: it's foolish to scour the world for nails, but it doesn't hurt to make a hammer.
Build the technology, think of how it could help, and if you can't find a niche in the world that it fits, don't force the issue. Move onto new things: perhaps re-use some old ideas, of course, but actively get a wider experience, so that you increase your surface area of finding some way for your technology to help.
Is there any cool stuff that doesn't involve speculative trading in some "coin" or "token"?
I recently read about a steel maker in India executing a cross border order on blockchain. On further reading it turns out their bank used a third party company for digitizing letter of credit and that company claims to be using an enterprise blockchain R3 Corda. R3 itself is owned by a consortium of banks and on their website they don't use the word blockchain to describe Corda. They call it DLT.
My understanding is that a blockchain is supposed to be distributed, trustless, permissionless, immutable and open. At least that is what the core ideology behind it and is touted as the cornerstone features of blockchain. An enterprise blockchain is private, trustful, permissoned and everything that is a blockchain is not supposed to be. At that stage is it even a blockchain or just another propitiatory data store?
Then you should be opposed to most basic (theoretical computer) science and mathematics research too that doesn't have any immediately apparent application.
The scientific research to engineering pipeline is the backbone of our rapid technological progress. Basic research can target unexplored areas in a more organized fashion, allocating resources properly instead of industry's ad-hoc approach. Sort of like breath first instead of depth first. Industry will waste resources solving just their own individual instances of a mini-problem one by one resulting in a total resource consumption that is greater than what academia would have used in solving the overarching problem.
The idea that blockchain tech is somehow invented out of nothing and then we search for a problem to match couldn't be further from the truth. Talk to anyone who works in the industry and they're trying to solve a problem.
I used to work in blockchain tech and the main problem I was focused on was "How do we prevent internet monopolies like Facebook and Google?".
If you don't see those monopolies as a problem, then you're disagreeing with the problem space, that doesn't make it "trying to find a problem".
How does blockchain tech prevent monopolies exactly? Any environment that respects property rights and has activities that can be done more efficiently with scale and concentration will have centralization. Cryptocurrencies themselves are centralized by almost every dimension because mining exhibits those characteristics. Nearly any interesting on chain technology is centralized in that a minority disproportionately receives the vast majority of the upside. None of this kills monopolies
And how does a distributed Ledger solve these problems?
Monopolies like Google and Facebook exist, in no small part, because the amount of computation and data they handle is vast, and they have the data centers to deal with that.
How much data gets has to be stored on the servers of such services? Per second? I'd assume its in the range of several GiB...again per second.
Okay, so how does the blockchain compare to that? Ethereum can store data, each byte requires about 600 of its "gas" computational equivalent. A block represents 30,000,000 gas, 1 block is generated every 15sec, so we can store a grand total of about 1MiB every 300 seconds...that is, if none of the gas is used for anything other than storing data, which means, no other computations running.
So how is "blockchain technology" going to solve the problems that come from such highly centralized services exactly?
> Talk to anyone who works in the industry and they're trying to solve a problem.
Sure. But are those problems worth solving? How many VCs does the world need to pump cash into NFT-enabled video games before we ask the question, "why?"
There's quite a bit of distance between blockchain tech and preventing Facebook/Google monopolies isn't there? And as long as blockchain tech has some dependency on capital investment, your better funded outfits are always going to have the terrain tilted in their favor.
the final paragraph seems to summarize the article :
"The more you think about it, the more “it’s early days!” begins to sound like the desperate protestations of people with too much money sunk into a pyramid scheme, hoping they can bag a few more suckers and get out with their cash before the whole thing comes crashing down."
Future will tell. But the author is either acting on bad faith or they are not informed on the innovations that happened since then and are currently happening in the crypto space. And I am not even focusing on NFTs but on hardcore crypto stuff such as multisig and zero-knowledge proof protocols.
Well, 10y ago is not ages ago. Email existed for 30 years before it was ready for consumers. Same is with the internet. Certain types of technologies require decades research and development. I would argue that in 20 years it will still be "early days" of blockchain. And only in mid 40 we will figure out apps and who nows what to fully utilize underlining technology. Right now we are just coping what we have outside of blockchain and put it on the blockchain. Same as people couldn't imagine how internet could possibly transform their business and life, we now can't imagine how Bitcoin and blockchain will transform our business and life in the future. It's too early.
I'd say with email the application was always crystal clear: It's like sending a letter, but electronically and therefore instantly. This must have been obvious to everyone in that space even 40 years ago. Maybe it wasn't obvious how big email would be one day, but there were definitely no doubts about what it would be used for. As someone who is trying to understand the applications of "crypto", it is very frustrating to hear stuff like "we now can't imagine how Bitcoin and blockchain will transform our business and life in the future". Please give me something! If we can't imagine it, maybe there is nothing there.
The application of Bitcoin is also crystal clear: distributed, digital money. It’s like gold, but electronic, and therefore much faster/cheaper in certain scenarios (and slower/more expensive in others).
Reasonable people disagree on whether this application is actually something we need, or will need in the future. But the application is clear as day.
Email is also used for authentication, all those 6 digit codes that come in for 2fa are doing so. Definitely not something that was imagined 40 years go.
we now can't imagine how Bitcoin and blockchain will transform our business and life in the future
40 years ago people on the cutting edge of tech had VHS video recorders to record broadcast TV. The tech grew slowly, became the dominant standard, and after 15 years in the mid-90s they were everywhere. 25 years later no one has one, or wants one, or even has an equivalent.
Don't assume too much about the future based on the present. Things can change in strange and unexpected ways.
I'm not saying Bitcoin and blockchain won't be around in 2040. They may well be. I'm saying current trends aren't a particularly good predictor of the future. They're wrong more often than they're right.
It might be that the idea is too complex to be viable or useful. The graveyard of technologies created in the past decades stretches to the horizon, so if something doesn't work after 10 years doesn't mean it will work in the future. This is kind of obvious.
Specifically with blockchain my intuition is that, if its main selling points - immutability and decentralization - are already invalidated in the early days (10 years that is), the chances that it will recover are slim.
Complex tech tends to centralize to become cheaper. Also immutability is very problematic in terms of the right-to-forget and also in terms of illegal content and illegal operations.
Email's purpose and utility was super-obvious from day one, we just had to figure out how to make it more secure. Notice how email too became centralized, however.
No. Email didn't have useful implementation (UI) until 30y after it was invented. Only geeks and tech savy people were able to use it because it was not so easy to use. Sending messages was really hard, sending would often fail. So you would say, 25y after email inception there was no useful implementation and no usage by consumers, so technology is worthless. And there were people who were saying that, I'm sure. Same was with the internet.
> "somehow no one appears to have managed to find a positive use for blockchains that wouldn’t be better served by blockchainless technologies"
There is now a sovereign nation state that accepted Bitcoin as a currency, and, mark my words, no doubt more will follow this 2022.
Replacing central banks, and by extension, their grasp on the limitless money printing, is the whole reason why bitcoin and it's blockchain exist. And it is working wonderfully well.
People in countries where the central bankers and politicians are letting them down are flocking to bitcoin and other later inventions (such as stable coins).
> "Rampant inflation is once again plaguing Turkey’s local currency, the lira, but one saving grace could be its citizens using bitcoin to supplant the plunging fiat currency."
By all accounts the adoption of that tech in El Salvador has been a disaster, the app is slow, buggy, not everyone has access and it’s easily exploitable for crime. Protests against it. Etc. I anticipate a reversal of this by the next government. Current governments cannot admit mistakes, so it’ll take a new term for it to be dismantled.
Uhm it might be hard to use but I completely reject the "exploitable for crime" part. Actually Bitcoin payments are a blessing for all those people that had to physically travel to Western Union branches to receive cash from abroad. Gangs frequently targeted such poor individuals and stole their cash. Bitcoin fixed this.
Yes, I agree, and this is all very cool, however regarding this point:
> There is now a sovereign nation state that accepted Bitcoin as a currency, and, mark my words, no doubt more will follow this 2022.
Sure. That's true, but doesn't actually matter, imo., because the point of crypto is to:
> Replac[e] central banks, and by extension, their grasp on the limitless money printing
So approval from the government in the case of crypto is worth about as much as it is for making love. It's the losing side of a game saying "You know what, we'll be so gracious as to allow you to win". Never needed your permission to begin with.
You’re referencing the point of Bitcoin, not the point of crypto. Other platforms aren’t interested in destroying the existing financial system and would much rather digitize it and make it open to everyone.
Not just a significant portion, the vast majority of money in circulation is money created by commercial banks, not central banks. For example, in 2007, Euros issued by the ECB accounted for less than 15% of the supply of Euros (M1): https://en.wikipedia.org/wiki/Fractional-reserve_banking#/me...
Readit News
1) a way to part greater fools from their money until the hype has died out
2) a hot topic to drive clicks and discussions for nerds and, increasingly, the tech press, from other more pressing issues that exist in terms of tech and culture and finance
In other words, its a bullshit scam, can we please move on already?
Every versioning of that idea is marketing speech.
Web2.0 might have had a silly name, but the idea of the web as something that the average user and company could contribute back to and use to communicate with in real time provided explicit value and convenience over existing alternatives (letter writing, door-to-door sales, in-person self-promotion, calling a pizza parlor, renting a physical video, long distance phone calls, physical plane tickets mailed to your house…)
I don’t see that with web3.0.
I don't follow the details of the web3 market closely, so not speaking in support or against here.
The exclusive communities you mention only have value because of the hype and FOMO and high dollar amounts that people see being made on sales of "exclusive" NFTs or some such. Same as many of the many crypto pumps, same as the dotcom bubble, same as tulips. Same as it ever was.
PGP did that 31 years ago though, faster and more efficient and without all the downsides?
I do that without any involvement of a blorkchain on a daily basis. Everytime I use my ssh key to connect to a server that knows my public key.
Can someone provide me with a clear example of this being implemented? AFAIK accessing blockchain from a traditional client(website/app) still requires going through a central node.
Did something change with 'Web3'? Pardon me for not being up-to-date but it's like one day I woke up and Web3 is all over the place it seems like well-coordinated, heavily funded campaign. How else can we explain this seemingly sudden trend of Web3?
I assume it would make the application much simpler because there would not need to be any or very little user-account management, no sending bills or charging credit-cards. Just gimme them bitcoins. The user-state could be stored on the client-machine, unless they especially want to pay for us backing it up on the cloud. Still it could be backed up anonymously, identified by the wallet.
No more hacking, if there were no user-accounts or passwords there would be nothing to hack.
I've learned enough at this point to know a scam when I see one, and I definitely don't need to go thru my history w/ software and tech bubbles and cryptocurrencies to explain why web 3.0 is full-on bullshit.
A useful contribution would be to point out how exactly the GP is wrong.
I can imagine the current international banking system get upgraded with a blockchain like technology such that you don't need a central bank of central banks.
But the web3 guys simply want to compare detractors to luddites
I get it, you don't like it.
So I agree with your last point: let's all please move on.
I like hashing things out but whenever there is a huge bandwagon effect, I am increasingly getting more skeptical. Happy to be wrong but we need skeptics that question mob mentality.
There are several recent examples of this: 1) Inflation 2) COVID origins (Lab leak) 3) Zero-COVID policies and lockdowns.
I always question these things - what if we are wrong?
We don't do that here.
Certainly, there are problems, but some things will live beyond the crash that is coming and change things in ways no one can be sure of. The internet started in the 1960s and was opened up commercially in 1989.[3] It feels like we are somewhere between 1995 and 2000. The energy feels similar with people trying to shove old paradigms into a new world, vaporware companies, and insane investments. I don’t think we’ve seen the top and it will likely make the crash of 2001 look small by comparison. I may be wrong, but if I’m not, it still is early.
[1] https://bitfinexed.medium.com/tether-is-setting-a-new-standa... [2] https://twitter.com/Foone/status/1457749433844568066 [3] https://en.wikipedia.org/wiki/History_of_the_Internet
It's amazing to me how universal the "I used to be a non-believer" line is in evangelism. From the classic "I used to be an atheist but I've been born again" to all the members of political party A claiming to have been a member of party B before seeing the light to technological evangelism.
It just jumps out at you after awhile.
(I was also against crypto/blockchains when I first learned about them last year)
Dead Comment
1) A common "universal" transaction data source
2) A shared, readable format
So the thought occurred to me that as soon as blockchain apps/currencies became popular, people would want analytics on them. There would thus be a startup opportunity for unprecedented analytics visibility into transactional data from a third party without needing to build bespoke integrations into high security/compliance systems.
If a blockchain backed currency was widely used, a third party could easily estimate the real-time sales flow of every brick and mortar store location. You could have real-time auditing and quarterly tracking of both public and private corporations available from a third party. Asset transfers, smart contracts, and their real world equivalents could be instantly monitored - allowing the early detection of emergent supply chain bottlenecks.
The problem with all of this is that in the 5 years since I had this idea, the only use cases for BTC and other cryptos has been price speculation. The market for such analytics products is effectively zero.
Additionally, I think there is big money in selling blockchain analytics to governments for the money laundering, darknet markets, and fraud sector.
https://www.coindesk.com/markets/2019/02/19/coinbase-acquire...
https://www.coindesk.com/business/2021/04/30/coinbase-to-acq...
https://www.cnbc.com/2021/09/09/mastercard-to-buy-blockchain...
https://www.coindesk.com/markets/2019/12/03/binance-acquires...
If the blockchain does enable this, wouldn't that just lead either to 1) companies not adopting blockchain, or 2) some solution for hiding the data and defeating third-party analytics?
You also seem to be missing a lot of interesting stuff happening with cryptos if you think it's exclusively price speculation.
Could you elaborate which gatekeepers it will disrupt?
I feel like a lot of the cryptocurrency critics commit the "fallacy fallacy". That is, they have the following reasoning: people believe crypto is good because of X, X is false, therefore crypto is not good.
Yes, there are a lot of people who are into crypto because they think it's a way to get rich quick. Yes, there are a lot of guru technical analysts who sell bullshit dreams on their Youtube channels. Yes, there are a lot of criminals who use cryptocurrency. Yes, crypto attracts a lot of charlatans and snake oil men. Yes, there are a lot unbacked stablecoins and shitcoins.
Given the above, it's easy to dismiss all cryptocurrencies as a scam. But when you dig a bit deeper, you'll find that there is true technical and financial innovation. For me, Bitcoin's potential to be a programmable money without government or central authority is a very powerful idea. The idea that you can be your own bank and do p2p electronic money transfers without an intermediary. That has never been possible before.
I could go on but my point is that even if there are many wrong reasons people like X, it doesn't necessarily mean that X is wrong/bad.
And it's debatable whether fiat will ever whither and die. The Government will ultimately have to endorse a currency for tax purposes, and they'll always seek to control the inflationary environment so they can maintain a workable budget and keep public services afloat.
Just a century ago or so, banking was only for large corporations. Commoners and small businesses all used cash and exchanging bits of valuable metal was the norm. I mean, believe it or not, we had good reasons to abandon that simpler system in the first place. Things are better now. Markets are more efficient.
My main problem is similar to the original article here. In 2014 Bitcoin was "The future of micropayments" 6 years later and now the narrative is that "Layer 2 networks are the future" It would be great if the crypto people could stop talking about how great the future will be and just deliver what they are promising
I will give you the technical innovation, but I really have not found anything financially innovative about cryptocurrency. What does crypto do that traditional currencies or payments systems don't? The only thing I see is that it largely replaces the old financial elite with a new financial elite and maybe under the right circumstances reduces fees for transferring money. That seems to be it unless you count circumventing financial regulation as a financial innovation.
Ah yes. The good old "just google it". There's literally not a single "dig deeper" resource on the internet that explains the need for blockchains/cryptocurrencies etc.
But sure, there are a lot of "innovations" with recursive circular "innovations" (like currency speculation, HFT and flash loans, all of "innovatively made available" by regurgutating the same fatasy tokens and pretending they are worth something)
My conspiracy theory is that when insiders trade a distressed asset at par or better it’s often a bailout expectation that’s really being traded.
Who has unimaginable access to financing, a “stablecoin” going so/so, and a primary line of business critically dependent on Tether, like, I don’t know, a massive exchange with the highest volume pairs all sharing USDT as quote?
It’s fractional reserve banking swapped around, with no reserve requirements. The market is the bank.
And because bitfinex is not obligated to redeems tokens for $1 they have no risk. It’s in their interest to keep the market price at $1 because the longer it runs the more money they make but if there’s a run on the currency they can just shrug and go home with their bag of dollars.
Ah yes. How can we forget the community-audited and vetted smart contracts that ended up draining its users' wallets of all their money. Transparency!
The Ethereum world computer has 300,000 nodes, and yet has 1/5000 the computation power of a single Raspberry Pi 4.
Except for actual cryptocurrencies, all the "web3" applications could use boring old 1980s vintage cryptography, be just as distributed, and run ten thousand times faster and cheaper.
----
So far the only way anyone has ever made any money from cryptocurrency is to sell it to someone for more fiat currency. In fact, in real terms, it has net lost money because of the huge amounts of electricity expended.
So once people such as yourself purchase cryptocurrency, they know in their hearts that the only way they will make more is if further people buy into their Ponzi scheme.
Therefore, your comment above.
...and then returned a few decades later to be oversold and overhyped some more, this time as "Deep Learning" or "AI".
Seems the alternatives on offer are scam or scam. (Or scam, scam, scam, ham, eggs, and scam.)
Making fake trades to make the price look like it's going up can be called market manipulation in this case I think. This is also called painting the tape. A similar but slightly different scheme is wash trading where you basically sell an asset to yourself to make it look like that's the price and that there is trading volume going on. There's a lot of this kind of thing going on with NFTs.
It sure has. But not really that fundamentally, since 2009.
A lot has changed in the blockchain space too. Just because you don't know about it doesn't mean it isn't true. A lot of those changes are on par with some of the tech advancements mentioned before my quote in the article. In 2009, you had bitcoin, so basically a distributed consensus workaround that enables artificial scarcity of fungible digital items. Today, you have sharded blockchains, triple entry bookkeeping, proof of stake, blockchains that handle incentivized file storage, alternate name lookup systems, purchasing compute power on an automated order book, liquidity pools (a major, major fintech advancement if you're not familiar with then), arbitrary code execution with a canonical record of it.
It is absolutely still early days.
Because these are decentralized consensus networks, there's inertia. Bitcoin is never going to be cutting edge. Because there's a lot of money to be made, there will be scams. Most of the "cutting edge" isn't cutting edge at all. But there are some real developments happening, allowing novel use cases, enabling very interesting things to be done.
I'm not a fan of the whole web3 concept. I think 99% of the selling points that the charlatans hype every market cycle are nonsense. But a little digging beyond an animated JS bloat landing page (a red flag all it's own) and you can quickly figure out what projects potentially have something and what's bullshit. Or you can do what I do and assume a project is a scam until proven otherwise.
It would be a shame if IPFS and Filecoin end up in the dustbin of history if the web3 music stops. They're the only reasonable non-financial applications of blockchain tech that I've been able to wrap my head around to date.
There was a project called Golem aiming to do the same thing with compute, it was pretty cool last time I read about it. Not sure how far along it is, and I'm sure there are other projects aiming to do the same thing.
snip
weird things no one gives one hoot about outside of the crypto shill word. All of this is just buttering the cat.
https://twitter.com/GossiTheDog/status/1476873668605186050
How many coins are actually using proof of stake?
Why haven't the biggest including Ethereum done so?
Ethereum does have proof of stake, a protocol called Casper FFG. It is currently live on the Ethereum beacon chain, waiting for consensus to move the entire network to it.
There are lots of smaller projects trying different protocols they call proof of stake too, as well as different proof of whatever they came up with for whatever reason. Most of them are veiled centralization, some of them are interesting for one reason or another. I'm not here to shill networks or coins so I won't be tossing names around.
That's running in parallel to the main network, which is still mining. Code to merge the two and eliminate mining is currently running on a public test network. Previous upgrades have all taken less than a year to go live after the launch of their public test networks.
I actually witnessed one attempt. An actual Fortune 100 built a Blockchain for their public communications. Mostly just an excuse to show off their street cred. It landed with an absolute thud. Nobody cared.
[0] - https://arxiv.org/abs/1703.00536
You leave the article with a certain conception and sometimes it's utterly shattered in the comments; This is one of those times.
If I heard a single use case where blockchain technology actually created real value in the world, and was better than other alternatives, I'd listen. But it has to create real value, based on the real world and not some fantastical notion of what money is or governments are for.
I think we skeptics want a grounded narrative, and we're stuck hearing a thesis statement and nothing to back it up.
How about uncensorable donations? For example Wikileaks got blocked by banks and payment processors when they wrote about the war crimes the US committed.
The US could block the banks, but they could never block crypto donations.
Take Nano for example: sub-second, 0-fee transactions, of any amount, to any (unbanked) person in the world. Of course, there is no way that any other (fiat) system can achieve this (due to operation costs, regulation, etc)
But the response of skeptics will always be "but I have to convert my fiat money". And at that point, it's not free and instant anymore.
But just because the new system loses its benefits because of backwards compatibility with the old system, doesn't mean that it is inferior. Maybe for some things, you don't need to pass through the old system anymore. One example is mining pool payouts, which can do payments through Nano to get the 0 fee transactions. (see https://2miners.com/blog/how-to-get-payouts-for-ethereum-min...).
You can argue that this mining is all a scam etc, but in the end real value is transferred using the most optimal network. More optimal than any central system that you can think of (remember 0-fee, instant trancations).
>But the response of skeptics will always be "but I have to convert my fiat money".
Here's a thought experiment for you. Your mother/father/neighbour's entire wealth is converted, at no cost to them, into BTC/ETH/whatever. What is their reaction?
Is it, 'thank god we didn't have to pay those conversion fees!'
I think not.
The blockchain adds nothing here, and creates a layer of complexity that makes it more brittle.
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I always assume that I'm wrong, so I'll keep looking for successful applications and I'm sure you can prove me wrong :)
https://www.omnichains.com
"Omnichain CEO Pratik Soni speaks to Inbound Logistics about the growing number of blockchain use cases in the supply chain, including in reverse logistics, product authentication and sustainability."
Apparently this company started with the idea that they would use the blockchain to make supply chains more transparent. And they raised money from investors with that goal in mind. But they have since retreated from that goal.
I worked with a retailer that worked with Omnichains. None of Omnichains tools had anything to do with the blockchain. Certainly, we were never given access to a blockchain, nor was it mentioned after we had signed the contract. Instead, we were granted limited access to an API that I believe was run with Ruby on Rails and MySQL. So at a certain point this company retreated to traditional technologies, rather than trying to use the blockchain.
This is one example. At some point I hope to write up some of the other examples that I've seen.
I do not believe anyone will ever find a legal use for blockchains that cannot be more easily served with traditional technologies.
One does not blockchain to build a product in the cleanest, most efficient manner.
One blockchains to have access to investors/speculators that control the gigantic pile of on-chain wealth that has accumulated over the past ten years, who would never sink $100k+ into a poorly drawn picture of an ape with sunglasses if it was running on Rails+MySQL.
This may sound like I'm being dismissive, so let me be clear, I am not - this is an extremely valid reason to chase this technology, and the existence of these (maybe ridiculous and shady, maybe not) massive stacks of digital cash is going to drive a lot of investment in the space, so if there is anything that can "break through" and prove real value beyond just targeting this wealth, someone is going to find it, likely as a side-effect of targeting these whales.
Web 1.0 couldn't have happened without the late 90s tech bubble, and as ridiculous as the Pets.com era hype was, when the dust settled there was much broader connectivity and a real market for the Internet companies that did live up to the hype over the next two decades.
Almost everyone at every stage in the supply chain have an interest in opacity rather than transparency. The people who may want transparency want transparency for themselves but not for others: they want the equivalent of a one-way mirror to spy through. Naturally, people tend to react with extreme negativity to the installation of such one-way mirrors. Actual transparency is desired by almost no one. This is even true at the consumer level: the consumer may want to know the supply chain information for various purposes, regulators certainly want to know it, business partners certainly want supply chain documentation, but a consumer would balk at the notion that they expose all of their credit card transactions to the entire world at all times. It's always transparency for thee and not for me.
Rails and MySQL are too transitory for that - you'd buy a record in the database only to find the company hosting the database had gone broke or been bought by Yahoo who closed them.
You buy a bitcoin and you can be fairly confident in a decade or two you'll still have it.
Anything that does not exist natively on the blockchain doesn't need a blockchain at all.
If a token on the blockchain would represent you as the owner of a car and one day someone steals your private key which represents your car ownership, that person is now the owner of your car. Still, the car keys are located in your house, the license plate is registered on your name and address, the insurance is on your name.
I guess I don't need to explain further how ridiculous that idea is that a token would officially represent you as the car owner.
You could get a credit card, and then it’s not even your money that you are spending! or your money that you lost to fraud.
I can see both of these existing in the crypto world in some form, the same way they exist in the fiat world
as for the banks and institutions and companies losing all of their money? that’s a new blockchain problem for sure
You could get a credit card, too, and then it’s not even your money that you are spending! or your money that you lost to fraud.
I can see both of these existing in the crypto world in some form, the same way they exist in the fiat world
as for the banks and institutions and companies losing all of their money? that’s a new blockchain problem for sure
Why take such a naive blockchain as example? You could very well have a proof of authority blockchain so that 3 notary have to sign a car transaction.
You could also very well have revocation lists published on the blockchain by a further authority if keys are stolen.
There are hundreds of ways to make this work.
At the very least, that would allow me to know that I'm not buying a stolen car.
1. Lack of tooling and cooperation for investigating fraud
2. Lack of regulation
3. Programmatic interfaces
4. There are markets like the NFT space that are amazing for laundering
But no part of why it's good for crime has to do with blockchain.
This alone trumps any arguments against bitcoin. Crime will exist forever and criminals will find ways to finance themselves anyway, so the use of cryptocurrencies for their operations is not really a factor.
It really feels like with the NFT backlash in the gaming world right now that crypto hasn't found its landing and it really hasn't taken off - its kind of in this weird purgatory. Im hopeful but very suspicious at this point. I wasn't suspicious of “the internet” until it was around for a long time. Crypto is past its wave of this is cool and lets build stuff phase afaik and now everyone is trying to make money off it.
If nothing else, it shows that crypto has succeed in one of its goals: moving money between countries, without being detected/hindered by governments.
I mean, I don't know who buys real estate with crypto, but I am assuming that people who live in dubai and have large crypto values are bullish on crypto, and won't waste it for a low roi investment like realestate. So that leaves rich foreigners who wants realestate away from their own government and I can see them purchasing bitcoins as a way to siphon money out of their country.
Other than that, I am also out of ideas for useful uses of crypto currencies
https://www.ccn.com/100-dubai-put-entire-land-registry-block...
These ideas are best left in the academy, and then later financialized. The exception to this is internal R&D (like Bell Labs and countless other extremely productive corporate divisions.)
Maybe I'm just greedy.
I don't think so.
It was supposed to be relatively boring tech solving a niche problem (from the guy on the streets point of view)
An example I use, is people expect bitcoin is anonymous. Yes, it is anonymous to the general layperson and corporation - but not to say NSA/FBI for "people of interest". And once bitcoin to USDollar transactions or financial institutions are more common - banks will sell your wallet information to credit bureaus, and eventually corporations will be able to de-anonymize chains for profiling just as today.
EDIT: forgot to say, this could be a complete lack of imagination on my part past what's been done with blockchain already or just my horrible indoctrination into the game-space like some kind of cult =)
There is no web3, nor web3 era. It is a marketing buzzword.
One example is sustainable (financially) open-source project is one I use now. Before that it was always impossible. You get a bunch of people all over the world, many of them are identified only by Internet handles. There's no investment to handle all the legalities of establishing a business, and anyway there's no legal framework for international businesses with psuedo-anonymous people.
But with blockchain we've been using DAOs and online voting tools etc. since 3-4 years now, and it works great. It handles the governance and the finance in a way the traditional system cannot offer.
And yet just like blockchain, you allude to something without providing any substance. What is the open-source project? You’ve failed to actually tell us what the real “thing” is.
You're saying that you wouldn't be able to perform online votes or surveys and remotely send money without a blockchain?
Could you expand more on what functionality that the blockchain provides that the other solutions in this space (online surveys and remotely send money) don't?
Not saying you are doing something wrong but rather that I see a lot of applications in the wild that have to do with people imagining also a different regulatory landscape - which actually is a discussion to be had.
Yes. Those scams have been put an end to by regulations by the SEC, as unregistered ICOs are now illegal since 2017. [0]
> there is not a single product aside from trading/finance that got traction.
So what is wrong with using blockchain domain names like ENS for identity, or sign in use cases? Are we going to look back at this in 10 years time and we will see this sort of adoption? [1]
[0] https://www.investor.gov/introduction-investing/general-reso...
[1] https://www.skiff.org/updates/skiff-ens
Department of transport?
Sending one packet costs $.00001 (100K packets for $1 according to their website). So we need to see 29,400,000,000,000 packets yearly on the Helium network for data fees to cover the gateway rewards.
Looking at data from The Things Network - who operate another LoRaWAN network - from their conference last year they mention routing 600 packets/second using 30,000 gateways => that's 630,720 packets per gateway per year.
Assuming that Helium sees the same ratio of packets, and that every packet is unique, and that every packet is meant for the Helium network (and thus paid) this yields an expected (630,720 * 490,000) 309,052,800,000 paid packets => 309,052,800,000 * 0.00001 = $3,090,528 in data fees.
So ~3 million $ in revenue (in very best case scenario) from data fees, but paying out ~294 million $ to gateway owners.
Naturally the only way this works is because they give out their own invented tokens rather than dollars. This does not make any sense, and will never make any sense. I read that the gateway manufacturers pay the Helium company 50$ per gateway (to provision a private key) which probably pays for some stuff (and to pump up their own coin), but if that's the case then it just looks like a pyramid scheme.
Also scale doesn't help if you pay out 100x more for every gateway than you can potentially earn per gateway. But that should be obvious. You're paying a gateway for 600$ and then you get >600$ in rewards per year. This does not make any sense.
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So, you're opposed to the internet, then?
Or is it that a global network of networks was a qualitative step beyond simple networking that didn't have a clear justification?
TL;DR: You're wrong.
No. We're opposed to Juicero and Enron
Don’t throw the baby with the bathwater. I really don’t think generalizations of certain jaded experience and then seeing the entire world with the same broken lens does any good. Probably the opposite. We ought to try new tech and keep an open mind.
Before people go off on Boston Dynamics - there are thousands of spin-offs, pick some other charitable example. The point isn’t about BD.
Blockchain was awesome technology in 2008, and Ethereum brought very interesting developments. But in the end there's only one thing it can do, and that's be an irrefutable ledger, and for most purposes that are of interest to the common person that is an insignificant improvement on centrally governed ledgers.
Blockchain? The money flowing in is substantially from retail investors. And that's the problem. This is why we have regulations.
Build the technology, think of how it could help, and if you can't find a niche in the world that it fits, don't force the issue. Move onto new things: perhaps re-use some old ideas, of course, but actively get a wider experience, so that you increase your surface area of finding some way for your technology to help.
I recently read about a steel maker in India executing a cross border order on blockchain. On further reading it turns out their bank used a third party company for digitizing letter of credit and that company claims to be using an enterprise blockchain R3 Corda. R3 itself is owned by a consortium of banks and on their website they don't use the word blockchain to describe Corda. They call it DLT.
My understanding is that a blockchain is supposed to be distributed, trustless, permissionless, immutable and open. At least that is what the core ideology behind it and is touted as the cornerstone features of blockchain. An enterprise blockchain is private, trustful, permissoned and everything that is a blockchain is not supposed to be. At that stage is it even a blockchain or just another propitiatory data store?
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The scientific research to engineering pipeline is the backbone of our rapid technological progress. Basic research can target unexplored areas in a more organized fashion, allocating resources properly instead of industry's ad-hoc approach. Sort of like breath first instead of depth first. Industry will waste resources solving just their own individual instances of a mini-problem one by one resulting in a total resource consumption that is greater than what academia would have used in solving the overarching problem.
I used to work in blockchain tech and the main problem I was focused on was "How do we prevent internet monopolies like Facebook and Google?".
If you don't see those monopolies as a problem, then you're disagreeing with the problem space, that doesn't make it "trying to find a problem".
Monopolies like Google and Facebook exist, in no small part, because the amount of computation and data they handle is vast, and they have the data centers to deal with that.
How much data gets has to be stored on the servers of such services? Per second? I'd assume its in the range of several GiB...again per second.
Okay, so how does the blockchain compare to that? Ethereum can store data, each byte requires about 600 of its "gas" computational equivalent. A block represents 30,000,000 gas, 1 block is generated every 15sec, so we can store a grand total of about 1MiB every 300 seconds...that is, if none of the gas is used for anything other than storing data, which means, no other computations running.
So how is "blockchain technology" going to solve the problems that come from such highly centralized services exactly?
Sure. But are those problems worth solving? How many VCs does the world need to pump cash into NFT-enabled video games before we ask the question, "why?"
https://techcrunch.com/2021/09/22/nba-top-shot-creator-dappe...
"The more you think about it, the more “it’s early days!” begins to sound like the desperate protestations of people with too much money sunk into a pyramid scheme, hoping they can bag a few more suckers and get out with their cash before the whole thing comes crashing down."
Reasonable people disagree on whether this application is actually something we need, or will need in the future. But the application is clear as day.
40 years ago people on the cutting edge of tech had VHS video recorders to record broadcast TV. The tech grew slowly, became the dominant standard, and after 15 years in the mid-90s they were everywhere. 25 years later no one has one, or wants one, or even has an equivalent.
Don't assume too much about the future based on the present. Things can change in strange and unexpected ways.
I'm not saying Bitcoin and blockchain won't be around in 2040. They may well be. I'm saying current trends aren't a particularly good predictor of the future. They're wrong more often than they're right.
Specifically with blockchain my intuition is that, if its main selling points - immutability and decentralization - are already invalidated in the early days (10 years that is), the chances that it will recover are slim.
Complex tech tends to centralize to become cheaper. Also immutability is very problematic in terms of the right-to-forget and also in terms of illegal content and illegal operations.
Email's purpose and utility was super-obvious from day one, we just had to figure out how to make it more secure. Notice how email too became centralized, however.
Blockchain has been waiting on a useful implementation since inception.
> "somehow no one appears to have managed to find a positive use for blockchains that wouldn’t be better served by blockchainless technologies"
There is now a sovereign nation state that accepted Bitcoin as a currency, and, mark my words, no doubt more will follow this 2022.
Replacing central banks, and by extension, their grasp on the limitless money printing, is the whole reason why bitcoin and it's blockchain exist. And it is working wonderfully well.
People in countries where the central bankers and politicians are letting them down are flocking to bitcoin and other later inventions (such as stable coins).
Just check these countries:
- Lebanon: https://www.aljazeera.com/economy/2020/2/25/distrust-in-leba...
- Turkey: https://etfdb.com/crypto-channel/as-turkey-lira-falls-bitcoi...
> "Rampant inflation is once again plaguing Turkey’s local currency, the lira, but one saving grace could be its citizens using bitcoin to supplant the plunging fiat currency."
- Also Turkey: https://www.nasdaq.com/articles/turkeys-inflation-is-an-exam...
- El Salvador: https://www.theguardian.com/world/2021/jun/09/el-salvador-bi...
- And El Salvador again: https://bitcoinmagazine.com/culture/bitcoin-el-salvador-geop...
Sounds like early 2000s online shopping to me.
> There is now a sovereign nation state that accepted Bitcoin as a currency, and, mark my words, no doubt more will follow this 2022.
Sure. That's true, but doesn't actually matter, imo., because the point of crypto is to:
> Replac[e] central banks, and by extension, their grasp on the limitless money printing
So approval from the government in the case of crypto is worth about as much as it is for making love. It's the losing side of a game saying "You know what, we'll be so gracious as to allow you to win". Never needed your permission to begin with.