The "1-2%" number the author repeatedly cites is misleading at best. These fees do not scale with the amount transacted. BTC tranfers are currently ~$0.80 whether you're moving $1 or $100k, which is a unique feature.
> SQL databases will continue to get faster as hardware speeds up - but blockchains only tend to get slower, as the volume of transactions grows.
This is also misleading, as there are systems like Solana which prioritize speed of confirmation, and do indeed get faster as hardware speeds up. It also allows for sub-cent fees (again, not based on a percentage of the amount moved).
This is not actually true, it still has the same scaling bottlenecks with state access but they are expressed differently (via hidden tx finality slowdowns) since it does not have an effective fee market.
Solana also ignores that part of the core reasoning that you'd want to use blockchains is for their decentralization and your ability to independently verify them in their pursuit of being able to claim 4000 tx/s. You need a 10 gigabit network connection to run a full node.
Ideal condition speed vs congestion speed is a different thing- I'm not suggesting they don't face the standard scaling bottlenecks, but it is also true that under similar congestion conditions, the network will run faster as hardware improves.
SQL databases also run slower under high load, which is totally independent of faster hardware allowing for faster databases vs the baseline
Re: independent verification, I agree with you. It's not a great tradeoff. I'm not here to shill Solana as a panacea or anything of the sort, just pointing out clear inaccuracies from the OOP.
But it doesn't, nobody has strictly improved on bitcoin (in terms of crypto design) since it was developed. Other cryptos will make claims about their speed or other things compared to bitcoin but never highlight what trade offs they had to make for those
Ethereum is a strict improvement on Bitcoin in nearly every way. Proof of Stake is a much better consensus mechanism all-around. Smart contracts allow for way more use-cases than just money transfer. The account model is much simpler and more intuitive than UTXO. The block time is considerably faster and finality is guaranteed.
Wrong. Some other cryptos do highlight their trade-offs. E.g. google "This isn’t to say Grin is better than others, it simply makes different tradeoffs."
My company actually does have a use case where a blockchain makes sense, and we are proceeding that with it. Unfortunately we have a buzzword trifecta of "blockchain", "AI", and "cloud" so we are careful about the words we use when we talk about it publicly.
We never utter the work blockchain because if you say "a blockchain" most people hear ** THE blockchain!! ** and either think we're a yet another bunch of scammers or worse, get tremendously excited thinking we're doing web3 or some other scam they want in on. Instead we say "we protect the data using Merkel trees."
We have the other buzzword problem too: we use some machine vision (for some safety matters) and use RNNs to determine some local operating parameters and to crunch data for some lab experiments. Even though we have two former AI research scientists on the team, none of us want to be lumped in with the big langage model folks, since that's not what we do (and the hype is insane).
The blockchain application: we have a shitload of sensors monitoring equipment we'll be deploying all over the world. Our revenue depends on the performance of this equipment. So every sensor is built into a little box that signs and timestamps its data. The data are aggregated by the equipment and streamed up to our servers (cough "the cloud"). Connectivity can be intermittent, so machines can offload data to topologically nearby installations.
It's actually pretty nice to be outside the hype bubbles. We just concentrate on our work instead, and mostly the prospective customers don't understand any of the tech, much less what those buzzwords mean.
If I understood your use case correctly, then you don’t actually have a decentralized deployment since there’s a central server, and you’re literally not employing the blockchain though?
Yeah, we only need a distributed chain at the edge, and even there there aren’t “competing” changes in the sense there could be in an implementation of a currency. But it’s a block chain like any other Merkel tree.
But it’s to prove chain of custody / lack of tampering since revenue ultimately depends on the data.
This article lists international money transfers as a non-useful application of blockchains. USDT on Tron alone is now settling 1.25T$ (1/3 of Visa’s annual settlement volume).
I think the autor would argue that we are still in the era of "crypto is too small to fully regulate" stage. But if we take it to the extreme and 50% of all transactions are done with a crypto currency, why would governments _not_ apply all the traditional financial regulations to crypto? Moving money internationally is not hard due to technical reasons, but due to political reasons.
With crypto, you can move a billion dollars in 15 minutes to anywhere in the world for like $15, without giving away either source or destination. To do this, you need to send about 250 bytes of information to any node in the blockchain network, using any way possible, up to and including dictating these numbers by phone or writing them on a piece of paper and smuggling said piece to anybody with a non-censored internet connection.
Goverments can make this illegal, but it is impossible to enforce it. These 250 bytes are just another "illegal number", which can be written anywhere, sewn on your t-shirt, etched in stone, etc. There are many fully secure ways to transmit 250 bytes without anyone knowing about it (including governments). Therefore, there is a secure and bulletproof way to smuggle a billion dollars out of the country without getting stopped.
No one can do anything about it.
(Well, there is a crypto-sanctions mechanism which can taint some money on the blockchain and can make it difficult to sell on exchanges etc. But it just creates some inconvenience -- there are many ways to launder crypto, from mixers to bridges and coinjoin and anonymizing through fees arbitrage and whatever).
The whole point of crypto is that, assuming you stay fully on chain, it cannot be regulated the way banks are. When you have the right keys and a connection to a node, nothing can stop you from sending BTC to another wallet. Regulation of crypto is possible only at the blockchain-tradfi interface (e.g. US Govt could tell Coinbase to not interact with a particular wallet). However, if crypto gains the sort of traction where you can buy most items with purely on-chain transfer, regulation becomes close to impossible as we see with cash.
If we take the logical extreme to mean that 50% of the transactions are carried out by 50% of the people, why would, at least where there are democratic governments, the people actively choose crypto because of its unregulated properties and then promptly undo it all with regulation?
But you're probably thinking of either cases where 50% of the transactions are carried out by a much smaller segment of the population or where there is a dictatorship?
International money transfers is the only really useful (non-scammy) application I can see for blockchains. But I personally wouldn't use cryptocurrency for even that because of the elevated risk involved.
isn't git effectively a blockchain? Its got blocks, they are chained (or tree'd) (to some degree), it doesn't need verifiers or mining since it can have users signing their inputs, and that is the only thing to be cared about.
Git does not have a consensus mechanism. You have your copy of the repository, and someone else has their copy. If you want to push your changes to a remote, if there were divergent changes you need to first pull the remote, merge the changes and resolve conflicts, and then push. The remote can change their version of the repo anytime they want in any way they want. Also, when you try to push a change, it is up to the remote to accept it or not, they can deny it for whatever reason.
The point of a blockchain is that 1. There is a distributed consensus about the state of the blockchain (the one accepted by 51%+ of nodes) and 2. No one can alter information relating to your wallet without your keys. Git lacks either of these properties and these properties cannot be introduced without a centralized system like Github/Gitlab. Thus, Git is just a decentralized protocol, not a blockchain.
IMO no, this is one of those cases where a word means a lot more than just its component parts, much like how "television" means a lot more than just "anything where you do far-seeing."
The practical/effective distinction between what is promoted as "blockchain" and older stuff--like "a distributed database with cryptographic features"--involves:
1. Unrestricted global public membership, new nodes can be created by anyone at any time.
2. A global data structure that cannot have more than short-term conflicts or branches. (Hence a pruned "chain" instead of "tree".)
3. A cascade of other features all designed to stop someone from taking advantage of #1 and #2 to take over with an infinite army of sockpuppet nodes. (Proof of work, proof of stake, etc.)
In contrast, with git:
1. The default membership is "just me." Groups are ad-hoc as you find other people who you do (or don't) agree to work with and choose what to push/pull to one another.
2. Separate branches are extremely normal and can live indefinitely, and it's also normal to shift data from a conflicting branch or entirely rewrite subtrees.
3. There is no "majority rule" or "tiebreaker" logic, and thus no extra machinery to try to stop it.
The verification and mining are the things that make blockchains unique (allow for adversarial nodes, censorship resistance) but you're not wrong that blockchains have a lot in common with git
it's pretty much the exact same principle, the chain of hashed commit contents being part of the input to the next commit in the branch have the same property
Blockchains are not intended to be a universal solution, they excel in different ways, particularly enabling trustless and censorship-resistant value transfer. Which, for many new chains, is still their most used function.
Blockchain came about because of the assumption that an internet currency must be zero-trust.
But let's look at these paragraphs:
> Blockchain stocks fail criterion #2: there being no trusted party to host the database. The fact is that if you're going to hold the shares of a company, you explicitly need to trust them - so you may as well trust them to host your database.
> For example you need to trust that their published financial statements are accurate. You also need to trust that they will try to return your investment. Traditional companies hold their own register of shareholders (they just outsource the trading) and it is a problem very, very rarely.
Currencies work because we trust that the government (IE, the thing that governs,) keeps a stable value in the currency. IE, currencies are built on trust.
Even Bitcoin relies on trust: You have to trust the source code. You have to trust that there isn't a large bad actor perpetuating a >50% attack. You have to trust that, at some point in the future, your bitcoin will be worth something. Governments have it in their best interests to keep their currency valuable. (Unless you're post-WWI Germany and it's in your best interest to hyper-inflate your currency to make your debt worthless. IE, Germany realized that hyper-inflation was preferable to the economic toll of paying off their debt.)
This lesson, that currencies only work through trust, really negates the point of cryptocurrency for general-purpose usage.
I've built consumer apps in the space since 2016. (See lab.dns.xyz for context).
At the end of the day, even if you gave the average person a venmo like UX that paid in any currency, instantly, for nearly zero fees, I still don't expect them to prefer it to a dollar bill or gold.
While the counterpoints regarding UX are very significant (lose all your money in one click, no undo, lack of support, difficult concepts that don't map to common consumer use cases), they can be solved through sheer effort. We did that on dns.xyz. Social login, gasless minting, rollup for fast interactions, all doable.
There is no escaping the fact that blockchains are slow databases. That they aren't particularly good at storing data. Much less private than one might think.
You do get consensus and attribution. You can use it as a sort of open standard or api where the items you've bought or the things you're written are open enough to be reused in the future.
None of these problems are pains that need solving. And they are inferior solutions compared with alternatives.
It is great tech. It is great intellectual exploration. It is a fun stack. It has made people money through unregulated speculation.
Crypto is a way to store and exchange things over the internet without counterparty risk. Crypto has value for the same reason gold has value beyond its practical use. Think SVB type situations or needing to flee a country that just became a dictatorship.
The article espouses a very US centric view where the government is a trusted arbiter of all financial transactions and there is always a trusted third party to take on counterparty risk. This is obviously not the case all over the world.
The question is how much is that actually worth and can it support crypto's current market capitalization?
Crypto also has value as being able to create digital scarcity and ownership. For example, when you play games online today and you purchase cosmetic items or you play magic the gathering and buy cards, it's pretty silly that you only own a license to use those things for as long as the game exists and there is no way to trade them.
The above concept obviously falls flat when there is no effective scarcity, ie when everyone and their mother can produce nfts that are just jpegs with no actual use. Compare this to a magic the gathering or pokemon card that is just cardboard but still manages to maintain its value.
> Crypto is a way to store and exchange things over the internet without counterparty risk.
I feel like I must be missing something, because there's still massive amounts of counterparty risk. If you're engaging with a bad actor, the only thing that it can guarantee is that the transfer of payment is completed, but there are no guarantees around the exchange of value.
If you're trading with someone operating in bad faith, there is nothing about blockchain that is going to help you, and in fact it becomes much worse, because there is no mechanism for forcing refunds. At least with legal tender you have entire systems in place for dealing with bad actors. I'm more that willing to recognize there are massive problems with those systems, but I have never understood how blockchain replaces those systems.
Can you explain in detail what you mean when you say there isn't any counterparty risk?
You are right that in the scenario of exchanging crypto for physical goods there is counterparty risk but when using crypto along with digital contracts there is not.
I think what you are missing is that in all transactions in the current financial system there is an additional source of counterparty risk in the bank itself. When SVB failed, if the government did not intervene all depositors would have lost all the money stored in the bank and all pending transactions would also have been lost. Or if you use a credit card, if the issuing bank goes bankrupt between the time the purchase was made and the business received the funds in their bank the business would lose the thing they sold and not receive money for it.
Not OP, but based on my (limited) understanding.. it should be possible to use something like a smart contract to provide a stable and auditable surface area whereby two parties could exchange funds for goods via escrow. You would be trusting the underlying platform, but it seems to remove the dependence on the person selling to you as being a good actor.
Crypto hasn't solved the digital scarcity issue at all. If the game stops existing so do the servers hosting the assets, since most crypto systems can only hold small tokens rather than the assets themselves. There are plenty of NFT examples where the underlying company went broke and the assets themselves disappeared from the internet. The MTG example falls flat if Wizards (the owners) take down their asset hosting services, so it's still mostly centralized and dependent on a company to function.
I believe this depends on the location of hosting. One version is that things are hosted by URI on wizards.com. Another is the data being stored on something content-addressable like IPFS where anyone with the content can verifiably attest to both ownership (b/c it's on the block chain) and that this is the real thing (b/c the content hashes match).
> Crypto also has value as being able to create digital scarcity and ownership. For example, when you play games online today and you purchase cosmetic items or you play magic the gathering and buy cards, it's pretty silly that you only own a license to use those things for as long as the game exists and there is no way to trade them.
This is nonsensical. Unless two games support some agreed upon mesh/texture format you're never going to be able to transfer your SpongeBob NFT into Call of Duty. Games aren't going to import foreign mechanics into their engines, a fantasy RPG doesn't have a way to use your Laso-o-blast 5000. A Magic card is useless in a game of Pokémon. Your Magic card isn't an unbeatable poker hand.
Digital scarcity is a problem looking to insert itself where no problem needs to exist. The world doesn't need digital scarcity. There's enough scarcity in the world already.
The marginal cost of digital goods is effectively zero. It's an anti-feature to try to push the marginal cost above zero.
That is one perspective but I think people actually want digital scarcity. The rare pokemon card that someone owns makes them happy because it's rare, otherwise they could have just bought a high quality print of it and stuck it on the wall of their room.
I think scarcity is obviously terrible for things like food and housing but for entertainment like above I don't think it is.
> For example, when you play games online today and you purchase cosmetic items or you play magic the gathering and buy cards, it's pretty silly that you only own a license to use those things for as long as the game exists and there is no way to trade them.
Those cosmetics or digital MtG cards would be just useless strings of bytes without a game to use them in. Might as well tie them to the game explicitly, by storing them on the game's server. Also, there's a way to trade digital MtG cards in Magic: Online (not in Magic Arena though). A friend of mine has made a living trading those digital cards for many years (by running trading bots).
I've heard the argument about online games using blockchain to store ownership data. I've not heard how it would actually improve things in practice. I'd love to know scenario people are thinking of here.
As charitably as possible, I can only think of a situation where there was no central server and instead the game was peer to peer. But then, it's very hard to imagine how to run the other parts of the game in a way that prevents cheating and makes the items 'meaningful'. The hard part would not be the storage of agreed item data but running the world real time on the client without verification but trusted.
Peer to peer worlds are an exciting idea but blockchains just don't solve them.
The other way people seem to suggest is when the servers are offline? Usually, that means the game is dead but let's imagine they open sourced the server. Well, then I guess you either have to trust the new server admins (no need for blockchain) or you could only allow items generated by the original game server only. But in this case, too, you could simplify things by just having a private key signature from the original server and a public key on each client. No need for blockchain there either.
Please help me understand because I'm genuinely interested.
One idea is to have a central network of 3d game assets and to give a license that anyone can use them for free in their game or experience as long as their game is part of the network and enforces the rule that assets can only be used by players that own them.
To make this beneficial to the game creators and artists, they can receive a percentage of each transaction made.
This is more a personal stance than anything else but digital scarcity shouldn’t exist. We’ve created this digital world that doesn’t have much of the physical constraints on it, why introduce them into it. What’s the point?
Readit News
> SQL databases will continue to get faster as hardware speeds up - but blockchains only tend to get slower, as the volume of transactions grows.
This is also misleading, as there are systems like Solana which prioritize speed of confirmation, and do indeed get faster as hardware speeds up. It also allows for sub-cent fees (again, not based on a percentage of the amount moved).
This is not actually true, it still has the same scaling bottlenecks with state access but they are expressed differently (via hidden tx finality slowdowns) since it does not have an effective fee market.
Solana also ignores that part of the core reasoning that you'd want to use blockchains is for their decentralization and your ability to independently verify them in their pursuit of being able to claim 4000 tx/s. You need a 10 gigabit network connection to run a full node.
SQL databases also run slower under high load, which is totally independent of faster hardware allowing for faster databases vs the baseline
Re: independent verification, I agree with you. It's not a great tradeoff. I'm not here to shill Solana as a panacea or anything of the sort, just pointing out clear inaccuracies from the OOP.
We never utter the work blockchain because if you say "a blockchain" most people hear ** THE blockchain!! ** and either think we're a yet another bunch of scammers or worse, get tremendously excited thinking we're doing web3 or some other scam they want in on. Instead we say "we protect the data using Merkel trees."
We have the other buzzword problem too: we use some machine vision (for some safety matters) and use RNNs to determine some local operating parameters and to crunch data for some lab experiments. Even though we have two former AI research scientists on the team, none of us want to be lumped in with the big langage model folks, since that's not what we do (and the hype is insane).
The blockchain application: we have a shitload of sensors monitoring equipment we'll be deploying all over the world. Our revenue depends on the performance of this equipment. So every sensor is built into a little box that signs and timestamps its data. The data are aggregated by the equipment and streamed up to our servers (cough "the cloud"). Connectivity can be intermittent, so machines can offload data to topologically nearby installations.
It's actually pretty nice to be outside the hype bubbles. We just concentrate on our work instead, and mostly the prospective customers don't understand any of the tech, much less what those buzzwords mean.
But it’s to prove chain of custody / lack of tampering since revenue ultimately depends on the data.
Clearly some people do find them useful.
With crypto, you can move a billion dollars in 15 minutes to anywhere in the world for like $15, without giving away either source or destination. To do this, you need to send about 250 bytes of information to any node in the blockchain network, using any way possible, up to and including dictating these numbers by phone or writing them on a piece of paper and smuggling said piece to anybody with a non-censored internet connection.
Goverments can make this illegal, but it is impossible to enforce it. These 250 bytes are just another "illegal number", which can be written anywhere, sewn on your t-shirt, etched in stone, etc. There are many fully secure ways to transmit 250 bytes without anyone knowing about it (including governments). Therefore, there is a secure and bulletproof way to smuggle a billion dollars out of the country without getting stopped.
No one can do anything about it.
(Well, there is a crypto-sanctions mechanism which can taint some money on the blockchain and can make it difficult to sell on exchanges etc. But it just creates some inconvenience -- there are many ways to launder crypto, from mixers to bridges and coinjoin and anonymizing through fees arbitrage and whatever).
But you're probably thinking of either cases where 50% of the transactions are carried out by a much smaller segment of the population or where there is a dictatorship?
The point of a blockchain is that 1. There is a distributed consensus about the state of the blockchain (the one accepted by 51%+ of nodes) and 2. No one can alter information relating to your wallet without your keys. Git lacks either of these properties and these properties cannot be introduced without a centralized system like Github/Gitlab. Thus, Git is just a decentralized protocol, not a blockchain.
> No one can alter information relating to your wallet without your keys
Git has signing of commits etc. So the equivalent (no one can alter your presentation of the view of the code) can be enforced.
- - -
To focus on 1 specific concept of consensus, would be to also claim the very common idea of private blockchains is poorly named.
IMO no, this is one of those cases where a word means a lot more than just its component parts, much like how "television" means a lot more than just "anything where you do far-seeing."
The practical/effective distinction between what is promoted as "blockchain" and older stuff--like "a distributed database with cryptographic features"--involves:
1. Unrestricted global public membership, new nodes can be created by anyone at any time.
2. A global data structure that cannot have more than short-term conflicts or branches. (Hence a pruned "chain" instead of "tree".)
3. A cascade of other features all designed to stop someone from taking advantage of #1 and #2 to take over with an infinite army of sockpuppet nodes. (Proof of work, proof of stake, etc.)
In contrast, with git:
1. The default membership is "just me." Groups are ad-hoc as you find other people who you do (or don't) agree to work with and choose what to push/pull to one another.
2. Separate branches are extremely normal and can live indefinitely, and it's also normal to shift data from a conflicting branch or entirely rewrite subtrees.
3. There is no "majority rule" or "tiebreaker" logic, and thus no extra machinery to try to stop it.
Someone else mentioned consensus which is orthogonal. Git does not have that part.
But let's look at these paragraphs:
> Blockchain stocks fail criterion #2: there being no trusted party to host the database. The fact is that if you're going to hold the shares of a company, you explicitly need to trust them - so you may as well trust them to host your database.
> For example you need to trust that their published financial statements are accurate. You also need to trust that they will try to return your investment. Traditional companies hold their own register of shareholders (they just outsource the trading) and it is a problem very, very rarely.
Currencies work because we trust that the government (IE, the thing that governs,) keeps a stable value in the currency. IE, currencies are built on trust.
Even Bitcoin relies on trust: You have to trust the source code. You have to trust that there isn't a large bad actor perpetuating a >50% attack. You have to trust that, at some point in the future, your bitcoin will be worth something. Governments have it in their best interests to keep their currency valuable. (Unless you're post-WWI Germany and it's in your best interest to hyper-inflate your currency to make your debt worthless. IE, Germany realized that hyper-inflation was preferable to the economic toll of paying off their debt.)
This lesson, that currencies only work through trust, really negates the point of cryptocurrency for general-purpose usage.
At the end of the day, even if you gave the average person a venmo like UX that paid in any currency, instantly, for nearly zero fees, I still don't expect them to prefer it to a dollar bill or gold.
While the counterpoints regarding UX are very significant (lose all your money in one click, no undo, lack of support, difficult concepts that don't map to common consumer use cases), they can be solved through sheer effort. We did that on dns.xyz. Social login, gasless minting, rollup for fast interactions, all doable.
There is no escaping the fact that blockchains are slow databases. That they aren't particularly good at storing data. Much less private than one might think.
You do get consensus and attribution. You can use it as a sort of open standard or api where the items you've bought or the things you're written are open enough to be reused in the future.
None of these problems are pains that need solving. And they are inferior solutions compared with alternatives.
It is great tech. It is great intellectual exploration. It is a fun stack. It has made people money through unregulated speculation.
But it is tarnished, clunky, and not necessary.
The article espouses a very US centric view where the government is a trusted arbiter of all financial transactions and there is always a trusted third party to take on counterparty risk. This is obviously not the case all over the world.
The question is how much is that actually worth and can it support crypto's current market capitalization?
Crypto also has value as being able to create digital scarcity and ownership. For example, when you play games online today and you purchase cosmetic items or you play magic the gathering and buy cards, it's pretty silly that you only own a license to use those things for as long as the game exists and there is no way to trade them.
The above concept obviously falls flat when there is no effective scarcity, ie when everyone and their mother can produce nfts that are just jpegs with no actual use. Compare this to a magic the gathering or pokemon card that is just cardboard but still manages to maintain its value.
I feel like I must be missing something, because there's still massive amounts of counterparty risk. If you're engaging with a bad actor, the only thing that it can guarantee is that the transfer of payment is completed, but there are no guarantees around the exchange of value.
If you're trading with someone operating in bad faith, there is nothing about blockchain that is going to help you, and in fact it becomes much worse, because there is no mechanism for forcing refunds. At least with legal tender you have entire systems in place for dealing with bad actors. I'm more that willing to recognize there are massive problems with those systems, but I have never understood how blockchain replaces those systems.
Can you explain in detail what you mean when you say there isn't any counterparty risk?
I think what you are missing is that in all transactions in the current financial system there is an additional source of counterparty risk in the bank itself. When SVB failed, if the government did not intervene all depositors would have lost all the money stored in the bank and all pending transactions would also have been lost. Or if you use a credit card, if the issuing bank goes bankrupt between the time the purchase was made and the business received the funds in their bank the business would lose the thing they sold and not receive money for it.
This is nonsensical. Unless two games support some agreed upon mesh/texture format you're never going to be able to transfer your SpongeBob NFT into Call of Duty. Games aren't going to import foreign mechanics into their engines, a fantasy RPG doesn't have a way to use your Laso-o-blast 5000. A Magic card is useless in a game of Pokémon. Your Magic card isn't an unbeatable poker hand.
Digital scarcity is a problem looking to insert itself where no problem needs to exist. The world doesn't need digital scarcity. There's enough scarcity in the world already.
The marginal cost of digital goods is effectively zero. It's an anti-feature to try to push the marginal cost above zero.
I think scarcity is obviously terrible for things like food and housing but for entertainment like above I don't think it is.
Those cosmetics or digital MtG cards would be just useless strings of bytes without a game to use them in. Might as well tie them to the game explicitly, by storing them on the game's server. Also, there's a way to trade digital MtG cards in Magic: Online (not in Magic Arena though). A friend of mine has made a living trading those digital cards for many years (by running trading bots).
As charitably as possible, I can only think of a situation where there was no central server and instead the game was peer to peer. But then, it's very hard to imagine how to run the other parts of the game in a way that prevents cheating and makes the items 'meaningful'. The hard part would not be the storage of agreed item data but running the world real time on the client without verification but trusted.
Peer to peer worlds are an exciting idea but blockchains just don't solve them.
The other way people seem to suggest is when the servers are offline? Usually, that means the game is dead but let's imagine they open sourced the server. Well, then I guess you either have to trust the new server admins (no need for blockchain) or you could only allow items generated by the original game server only. But in this case, too, you could simplify things by just having a private key signature from the original server and a public key on each client. No need for blockchain there either.
Please help me understand because I'm genuinely interested.
To make this beneficial to the game creators and artists, they can receive a percentage of each transaction made.