[mattdesl]

The scope of the problem is basically what is happening on Uniswap (peer-to-peer swapping of ERC20 tokens) and Opensea (peer-to-peer swapping of ERC721/1155 tokens), which together account for the vast majority of Ethereum's daily contract activity.

These discussions often circle back to the notion that USDC, ENS, or any other ERC20 or ERC721 (NFT) is "not real" and therefore this problem is not worthy of study.

And yet nobody has an issue with Namecheap marketplace—a centralized ledger that manages token balances and virtual property exchange (domain names), without these token credits/debits ever being realized in your bank account (i.e. you can transact within their virtual dollar system without withdrawing funds to PayPal).

[dmitriid]

> The scope of the problem is basically what is happening on Uniswap

So,

1. "a very minuscule subset of a very minuscule number of activities that people engage in", to quote myself, and

2. flash loans and "HFT" using speculative virtual tokens, so very much a circular reference

> And yet nobody has an issue with Namecheap marketplace

1. First time I heard of it

2. It doesn't pretend to be "redefining finance", or "being a revolution", or "destroying traditional banking", or whatever other bullcrap comes out of "DeFi" and other crypto

3. Never does it say anything about "virtual dollars", all prices are listed in real money, and the deposits you may make into your account are also real money

[hiq]

> And yet nobody has an issue with Namecheap marketplace—a centralized ledger

If nobody has an issue with it, why are you talking about an alternative to it? What's the benefit? Also note that Namecheap does sell domains that are then recognized by many other entities, it's not a "virtual property" that only leaves within Namecheap's system, it's something you end up owning in the legal world.

The "not real" argument is that you change your trust model as soon as you reach boundaries. Uniswap etc. are trustless, but only up to the point where the assets traded become real and are redeemed outside of the blockchain and some legal entity can actually back up the value of the tokens you traded. One of the selling points of Ethereum is that you don't need to trust anyone; if that's not the case, as we both agree, what's left? Why do you need Uniswap to be trustless when you rely on legal entities to ensure that what you're trading has some non-fictitious value?

You wrote:

> 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

If I try to parse this, you substitute some blockchain to the laws usually ruling relationships between entities, and instead of a judge, you use smart contracts to decide what happens. But again the scope is too limited to be useful, because the real world doesn't live in a blockchain, and the smart contracts will only rule a tiny part of these relationships. That's the token redemption example above.

[mattdesl]

> If nobody has an issue with it, why are you talking about an alternative to it?

this entire far-too-long discussion I’ve participated in stemmed from the notion that blockchain’s goals are already better solved by existing solutions. I asked for any that solves peer-to-peer decentralized escrow of a digital asset like a domain name; so far the primary response have been “you don’t need to do that since you can trust [centralized company].”

I’m gonna have to step out of this thread at this point but thanks for the discussion!

[hiq]

> so far the primary response have been “you don’t need to do that since you can trust [centralized company].”

It's more like: you can try, but current blockchain-based systems don't succeed at this, because you do end up trusting one or several entities (you wrote "Using a blockchain doesn't mean you no longer need trust."). So even blockchain-based solutions don't solve this problem, and if they don't, it's unclear what benefit they bring, even years after.