[Fede_V]

What a disappointment, so many NFT/crypto companies. Given current blockchain technology, this is something that straight up makes the world a worse place by making existing processes significantly more carbon intensive.

I would consider working in crypto to be the equivalent of working for Juul or a tobacco company. Not quite as evil as working for a company that provides spyware that's used against human rights activists, but, the rung above that.

[mlinsey]

doing just a quick search in the public directory, I found 24 out of 394 companies are in crypto. That's a lot lower fraction than you'd expect given how much mindshare, hype, and attention crypto has now vs. other sectors.

I am a crypto-skeptic, and consciously chose not to work on it myself, but I still wouldn't want any investor, especially one as early stage as YC, to categorically rule out a sector based on the impact of its current technology, the state of the technology will be different when these companies have grown.

Eg with respect to the carbon impact of crypto specifically, the current chains are very unscalable for the exact same reason that they consume lots of carbon; while the per-user stats look bad now, any world in which these companies are used at the scale of web 2.0 platforms is necessarily a world where the carbon footprint per user is many orders of magnitude lower.

[Fede_V]

I agree with your first point: 24 out of 394 is too many for my taste, but, given how hyped the sector is, it’s not a huge amount.

Per the second point, I actually completely disagree. I think there’s huge social dynamics in play that make it harder to move away from proof of work because miners have massive amounts invested into mining equipment. We might see Ethereum move to PoS eventually (maybe) - but - that will be in spite of social dynamics and because some of the leaders are stubbornly trying to do the right thing.

[mlinsey]

I think in the scenario where miners block the move to PoS (or any other much-more-scalable technology) is a scenario where nobody ever actually uses crypto for anything, and almost all coins go to $0 after the speculative bubble pops. To be clear, I think that's certainly a possible world, maybe even the modal outcome.

The alternative world, where we're using crypto to pay for everything, and we're no longer logging into twitter, but instead using our keys to log into a client for a globally distributed twitter where we own all our data on a blockchain - that's impossible without not just Eth2 but a several orders of magnitude of improvements beyond that.

Basically, I think taking the current per-transaction carbon impacts, multiplying it by eg. Visa's transaction volume, and forecasting a world where crypto is burning 1,000X as much carbon as the whole transportation sector or whatever - is a fallacy. Crypto will either solve the scalability problem (and therefore consume a much more moderate amount of energy), or it won't be used at all.

[eqmvii]

I feel the same way. A speaker at a conference recently referred to "Web3" as "controversial, but not going anywhere."

I not only believe that's false, I'd like to actively contribute to falsifying it.

[nso]

What is the crypto killer? I still don't understand what the value proposition of crypto is (well at least one that can be said with a straight face or without magical thinking)

[yumraj]

> What is the crypto killer?

Time.

[jedberg]

That depends if they choose a proof-of-work or proof-of-stake blockchain. Proof-of-stake isn't all that energy intensive.

And do you complain about the energy of credit cards vs cash? Technically cash is carbon negative since the cash itself is a carbon sink. So should we be pushing against credit cards because of all the servers it takes to process them and all the oil it takes to make the plastic?

Or do the benefits perhaps outweigh the costs and provide other second order opportunities for energy savings?

[bradgessler]

This is like arguing circuit switching is more efficient than packet switching for voice. There’s an account in the book, The Master Switch, where an AT&T exec shrugged off a demo of the internet in the 70’s because packet switching was woefully inefficient. While true, it misses a much bigger picture that we now understand today.

There’s definitely lots of problems with NFT/crypto, but I’m pleased people are risking time and capital to explore if these ideas work. Hopefully the energy usage issues are addressed and the world emerges with an environmentally friendly blockchain that we can use for global consensus.

I don’t understand why people outright dismiss crypto/NFTs by comparing them to tobacco companies or outright banning it from conferences like Rails Conf. Yes, some crypto/NFT companies are scams, but so are many other non-crypto/NFT companies.

What we should focus on are highlighting the crypto projects that are actually good so we can become smarter and more educated about the ways we might deploy this technology.

[beaconstudios]

Given we're heading into environmental crisis, I don't think it's morally defensible to promote a system which actively attempts to maximise energy consumed to the point of restarting coal power plants, in order to explore industries that have primarily been used for greater-fool and pump-and-dump wealth transfer. I haven't seen any examples where NFTs actually have use that isn't just "collectibles + massive energy waste", and the only uses I've seen for crypto outside scamming are avoiding legal barriers ie transferring money over borders, selling drugs, that type of thing.

You'd need to put forward an argument for specific NFT or crypto tech that hinge on blockchains as a necessary component of the innovation, and I've literally never seen that. I've seen plenty of "thing X but on the blockchain", which is not innovation, it's branding.

The fact of the matter, as far as I can see, is that NFTs and crypto are popular because they enable you to make tons of money grifting, without having to go through the inconvenience of providing any actually-useful innovation, while contributing to environmental destruction. It's like boiler-room penny stocks, if they were fuelled by coal-rolling.

[syntheweave]

There's quite a big elephant underneath this argument, which is the "zero utility in crypto" assumption. If utility exists then the question of energy use and externality is simply a matter of cost/benefit like everything else society does with resources.

And then you go back to why the stuff was invented, and it was for exactly the thing that you're dismissing, which is to evade authorities and enhance privacy through cryptography. That is the utility Satoshi identified, and it drove initial adoption, and continues to be pursued through privacy coins. A zero utility stance amounts to "Satoshi had no justifications". The rest is negotiation of the price.

Everything after that - copycat coins, distributed computation on Ethereum, NFTs and so on - is "what else can we do with this stuff", which is actually a much more challenging problem because it suggests no particular specification, hence the entire space is in the midst of a random walk in which features are developed with few concepts grounding our ability to determine whether they do the things we're imagining they do. The scams have a playground, but that's not actually different from capitalism in other times and places.

[e28eta]

> There's quite a big elephant underneath this argument, which is the "zero utility in crypto" assumption. If utility exists then the question of energy use and externality is simply a matter of cost/benefit like everything else society does with resources. And then you go back to why the stuff was invented, and it was for exactly the thing that you're dismissing, which is to evade authorities and enhance privacy through cryptography.

Passing laws and then prosecuting offenders is a major way that society codifies what costs are acceptable and what’s unacceptable.

If you believe that offering an bypass around that control has utility (corrupt regimes, whatever), I don’t think it’s fair to handwave the really sticky part: how does society add controls so that we don’t destroy the planet through runaway energy consumption, or end up with the smartest, most ruthless, and least ethical folks controlling all the resources.

[beaconstudios]

I'm aware that there is utility in crypto in being ungovernable (though ideologically I only partially agree with that utility - I think tax evasion is immoral under the current system, for instance) but I'm saying the cost/benefit weighs massively in the cost side: not only the positive feedback loop of energy consumption, but the fraud, the wasting of skilled engineers' time building ever more elaborate scams, the empowerment of ancap types like Buterin, the enabling of actual immoral crime like ransome ward, just so so many negative utilities. Proponents don't even invest what I consider the actual upsides like remittance or harm reduction in buying drugs - they invest in get rich quick schemes. That should tell you where their priorities lie.

[dmamills]

This is completely my opinion, but I believe people are risking time and capital because they are motivated to get their money laundered cleanly, and at a stable exchange rate.

The Cutest YC Startup in the world can't wipe out the swaths of: illegitimate casinos, drugs dealers, and content for sale so awful I cannot describe it here. The foundational transactions the whole system stands on.