[pja]

If you’re transacting with a bunch of people that you do not trust then the payment rails are the least of your problems.

Your comment just feels like typical crypto-booster vague handwaving to me - can you give an actual example of such a situation where the existing third parties that alreayd exist to solve these kind of problems cannot be used? Be concrete.

[mattdesl]

I gave an example here[1].

The typical answer is "just trust a third-party service" which side-steps the constraints in the question.

FWIW there is a variety of reasons you may not want to use a service like escrow.com — they take a cut of the exchange, operate as a for-profit business in a particular US-based jurisdictions, only operate on a limited set of currencies, request personal/private data sharing, and tend to settle the transaction in days, not seconds or minutes.

[1] https://news.ycombinator.com/item?id=31190423

[hiq]

Your example only works because you're considering an asset that lives in the blockchain itself. So it doesn't apply to anything physical, as in this case, you need a trusted channel to transfer the asset anyway, and a blockchain doesn't solve that.

Even considering only these digital assets, you have an implicit notion of trust. The xyz.eth representation on the Ethereum blockchain is considered valuable because most people think it does represent what people expect to find at xyz.eth. But the ICANN can change this at any moment by adding .eth to https://en.wikipedia.org/wiki/List_of_Internet_top-level_dom... and this will all be gone.

Humans don't live in a blockchain, and blockchain rules don't apply outside of it, so you can't solve this boundary problem. Or rather, you solve it by trusting whoever's in charge of this boundary.

[mattdesl]

The whole point is peer to peer transfer of digital assets and digital state that is recorded on-chain. The goal is not “how to transfer a physical asset.”

These assets do have market value (despite your own personal feeling on what they “should” be worth) and so users do wish to find ways of interacting with and trading them without an intermediary.

The TLD/ICANN is irrelevant, as “.eth” is a construct for Ethereum clients, not HTTPS clients.

And yes, we build trust of, say, an immutable contract address originated by a human, and continue to trust in it years later because (a) the ledger is incredibly expensive to dismantle and (b) we can cryptographically verify this on our own local node.

[hiq]

> The whole point is peer to peer transfer of digital assets and digital state that is recorded on-chain. The goal is not “how to transfer a physical asset.”

Yes I understood where you were going. Just pointing out that the scope of the problem you're solving is way smaller than that of a generic transaction, to the point that it has very little relevance for pretty much anything real.

> The TLD/ICANN is irrelevant, as “.eth” is a construct for Ethereum clients, not HTTPS clients.

What do you think would happen to the value of the xyz.eth domain registered on Ethereum if ICANN decided to have .eth as a TLD and somebody made a website on a xyz.eth reachable natively via mainstream browsers?

This value would decrease, independently of what actually happens on the blockchain. Value doesn't exist independently from the real world.

Trusting a certain smart contract about what's at xyz.eth rather than another is also arbitrary and is a matter of social capital, again something that's not embedded within the blockchain.

[mattdesl]

The assets are “real” in the same way domain names are “real.” These are social constructs, maintained by social consensus.

It is very easy to come to a shared consensus about what address “mattdesl.eth” points to, because the history is recorded on-chain, and can be verified locally. I’m sure the exact valuation of this domain will go up and down, but as long as the the chain and network continues to exist, the asset holds value within the network, regardless of what occurs with ICANN/TLDs.

[hiq]

> These are social constructs, maintained by social consensus.

AKA trust, so we're not transacting only with "a bunch of people that you do not trust".

[dmitriid]

> of digital assets and digital state that is recorded on-chain. The goal is not “how to transfer a physical asset.”

Even with "purely digital assets" you have the trouble with oracles that provide you with data and whom you must explicitly trust, and with trust in general (when someone sells you NFTs that may or not be stolen from someone else).

The sum total of "p2p transfer of digital assets and digital state that is recorded on-chain between parties [without intermediaries - d.] that don't trust each other" is a very minuscule part of a very minuscule subset of a very minuscule number of activities that people engage in.

[mattdesl]

I'm not sure what point you are making. Using a blockchain doesn't mean you no longer need trust. But it can be used as a tool to help build social consensus about certain digital state/records without placing the data in control of a single centralized entity. Same discussion was had here[1].

[1] https://news.ycombinator.com/item?id=31190947

[dmitriid]

> I'm not sure what point you are making.

As a simbling comment desctibed it, "the scope of the problem you're solving is way smaller than that of a generic transaction, to the point that it has very little relevance for pretty much anything real."

[ohthehugemanate]

I always thought the grocery supply chain was a good example use case. Multiple parties (seed origin, farmer, fertilizer manufacturer and/or dispenser, pesticide manufacturer and/or crop duster, harvester, transporter(s), grocery association, grocer) who all handle any given tomato, all with incentive and opportunity to lie to some other members along the chain, but not to their immediate neighbors. Plus, even who the members ARE is not necessarily known from the beginning (eg the destination country for produce in the EU is decided based on market conditions when it's already en route). And the end consumer (or their representative in the grocery store) cares about the entire origin chain. (By which definition(s) is this tomato organic? How was this chicken treated? What was this cow fed? What's the real carbon cost? Etc)

In order to solve this in a centralized way, you need to sign up and authenticate literally all the farm organizations in Europe, and all the competing grocers and transport companies. They all need to sign that they trust the third party service to be a fair and neutral record keeper... the third party company which has enormous financial incentive to cheat, on behalf of literally all its customers.

But with distributed ledgers with attestation, the record is unfalsifiable. Each tomato can have its own blockchain with attested entries from each fertilization, spray, and transporter, all added and attested at the point where lying is hard and the value of the lie is low.

You could achieve this with paper and signatures for each tomato, but it would be a lot of paper.

[cedilla]

This is a very good example of the typical argument that shows the critical flaw.

The flaw is that there is never any way to actually tie the real world to the Blockchain. It's literally impossible. You can have all the fancy mathematically proven Blockchain records you like, but it's just impossible to tie that to an actual tomato or actual pesticide.

We have track and trace system already for crops and they have the same problem: all the paperwork in the world can't prevent someone from, say, weighing a box of tissues instead of the box of cigars you intend to sell. In the end you need to trust someone.

[swalsh]

I'm a huge blockchain advocate, but I 100% think this is an important point people need to understand. The blockchain is a great solution for pure digital assets. Its an awful solution for physical stuff.

I think this is a holdover of thought from bitcoin. Bitcoin wanted to be a currency for our real world economy. It never became more than that for many reasons. ETH (and now more modern chains) have become more than currencies. They are digital economies. Physical items are foreign goods in a foreign jurisdiction the local economy has little control over.

Even within crypto, different L1's are like foreign economies, and moving assets cross chain is complicated.

[q3k]

How do you tie real world tomatoes to NFT tomatoes? Who verifies this? How do you tie an NFT of a grassfed chicken to a real world grassfed chicken? Who verifies these chickens are actually grass fed?

[FabHK]

You don't understand. People didn't have tomatoes and grass-fed chicken until Blockchain came along and solved these problems. /s

[dmitriid]

> all with incentive and opportunity to lie to some other members along the chain, but not to their immediate neighbors

And how does blockchain prevent them from lying?

> you need to sign up and authenticate literally all the farm organizations in Europe, and all the competing grocers and transport companies. They all need to sign that they trust the third party service to be a fair and neutral record keeper

Instead they all need to sign up onto the blockchain and lie directly on the blockchain

> Each tomato can have its own blockchain with attested entries from each fertilization, spray, and transporter, all added and attested at the point where lying is hard

Fertilizer put on the record that tomatos are fertilized.

Sprayer put on the blockchain that tomatos were sprayed.

Transporter put on the record that tomatos were transported.

You arrive at the shop to find rotten potatoes instead.

How did blockchain help?

Also note that in this current world that is so horrible according to you you arrive at a shop to find tomatos that have passed all inspections and have been delivered to you. What eaxctly does blockchain intend to solve?