[mtsr]

It might have something to do with all the cryptobro’s pushing get-rich-quick-schemes. Crypto-enthusiasts ignore how regulations existed for good reasons before regulatory capture made a mess of things. Not everyone likes the idea of an anarchocapitalist future.

And I’m not even talking about the outright scamming and the fact that most crypto’s primary use case is criminal. Or the environmental issues of spending energy we can’t spare on something we could solve so many other ways.

[r00bot]

I personally take a hesitant approach to crypto/blockchain technology. I'm open to using it where it's legitimately better than other approaches, but for the vast, vast majority of applications traditional methods are always going to be better than shoe-horned decentralization.

It's very unfortunate that the grifters have given the technology such a bad name when, like any technology, it has applications it excels in and others it doesn't. We're still definitely in the phase of working out what, if anything, blockchain is better (than centralised implementations) for. And it sucks that that search is being negatively impacted by all the grifters.

In the future I wouldn't be surprised if we saw 99.99% of blockchain stuff dead, but the small percentage that survive could disrupt some industries (I'm not convinced finance is one of those industries though lol).

[dmitriid]

> like any technology, it has applications it excels in

Name five.

[dane-pgp]

1. Permissionless, censorship-resistant global money transfer

2. Smart contracts

3. Append-only logs synchronised between mutually distrusting parties

4. Decentralised identities

5. Microtransactions for online games and to replace web advertising

[NoGravitas]

1. Except cryptocurrencies aren't any good for that, because the transaction costs are too high, and the value of cryptocurrencies too volatile. Cryptocurrencies are not a medium of exchange.

2. Now, what's a valid use-case for a smart contract, and please explain how it functions if there's a bug in the contract?

3. Maybe. You'll need to provide a more concrete use-case. Also, you have the outside-world problem (you know the data hasn't been altered, but you don't necessarily know where it comes from).

4. All you need for decentralized identities is a public key. (Though if you want your identity to be long-lived, you'll have to also have a system of secure key rotation, and the most straightforward system is blockchain-ish in that it involves a signed append-only log. But it doesn't need a global trustless ledger.

5. See 1, except worse, because the transaction cost dwarf the actual payment.

[dane-pgp]

1. If you're sending a portion of your monthly wages as a remittance to your family, spending a dollar[1] isn't too much.

2. A smart contract allows decentralised organisations to function, with democratic voting and transparency. (That's not appropriate or necessary for every organisation, but it can be an improvement on one person hosting a server and saying "Trust me"). If there's a bug in the contract, you have to vote to change the contract. Traditional contracts, businesses, and even countries fail all the time, but we haven't give up on them as concepts.

3. For a concrete use-case, I offer the example of blockchain technology being used to make the fishing industry supply chain more transparent.[3] It's true that someone could enter fake information onto the blockchain, but they could also fake signatures on paperwork, so a system can still be useful even if it doesn't prevent all possible attacks.

4. If the ledger isn't trustless, then someone is controlling it, so your identities aren't really decentralised.

5. There are better currencies than BTC if transaction costs are the main concern. The equivalent number for BCH is half a cent.[5]

[1] https://bitinfocharts.com/comparison/bitcoin-transactionfees...

[3] https://www.reutersevents.com/sustainability/using-blockchai...

[5] https://bitinfocharts.com/comparison/bitcoin%20cash-transact...

[dmitriid]

> A smart contract allows decentralised organisations to function, with democratic voting and transparency.

A smart contract is neither smart, nor a contract. It's a program, written in an esoteric language, and running in the world's most inefficient VM.

It's so bad and overcomplicated that "smart contract" authors themselves routinely make mistakes in code equivalent to the most basic of actual contracts. And since there's no avenue of recourse, these mistakes are irreversible.

"Smart contracts" also require the user to pay for any meaningful action.

As for "transparency", there's no transparency when something is enforced by code very few can read and understand (compared to actual contracts that can be read by humans).

As for "democracy", there's nothing democratic about "who has the most money has the most votes".

> Traditional contracts, businesses, and even countries fail all the time, but we haven't give up on them as concepts

Because we have thousands of years of history teaching us how to deal with those, and guess what, we've come up with multiple things like:

- regulations

- contract clauses dealing with failure

- avenues of recourse

- various methods of enforcement

Crypto bros pretend that these things are unnecessary, but then immediately turn to courts to sue scammers, or cry in cryptoforums when a "smart contract" bug wipes their wallets out.

[lehmannro]

The only concrete use case you've offered “is unlikely to deliver substantial gains to the industry when compared to alternatives” such as shared databases, which don't require any costly consensus algorithm.

https://doi.org/10.1016/j.techsoc.2020.101298

[tester756]

>1. Permissionless, censorship-resistant global money transfer

>5. Microtransactions for online games and to replace web advertising

how money transfer and microtransactions are different?

[dane-pgp]

They are (at least) two separate use cases, even though they are both examples of sending money. (You could equally say that they are all examples of sending data).

1. Some people want to be able to send large amounts of money internationally to their family in a country which has currency controls and "official" exchange rates. Others want to be able to send funds to organisations that have been banned by traditional money transmitters, such as Wikileaks, or protest groups, or adult content, or cannabis.

5. Separate groups of people don't have a problem with their government's fiscal or censorship policies, but simply want to be able to buy an emote or a skin in an online game, or to listen to a piece of music or read an article without being tracked around the web or needing to wire 50 cents from their bank in Mongolia to the service provider's bank in Cyprus.

[salawat]

1. The problem there is exactly why the space is going to remain a reserve for fundamentally illegal activity. Arguably it shouldn't be. I get that. That still doesn't get me any closer to me suggesting anyone's grandma hop into Web3.

5. So you're still being tracked, because there isn't a company around that isn't monetizing viewership data. Also, if you're fine with fiscal policies, why are you hesitant to wire? Sounds to me like you're dissatisfied with your host country's fiscal controls, or service provider's offerings.

Look, control over financial networks is one of the most powerful soft control mechanisms on the planet. You will not work around that. Government is slow to catch up, but I assure you, these folks aren't stupid anywhere close to 100% of the time. The fact regulation is crystalizing around crypto as fast as it is without taking the multi-century learning experience trad-fi did is evidence enough of that.

If it comes down to "a bunch of nerds created an unregulable financial system" I can pretty much guarantee it'll get gobbled by trad-fi snd re-centralized.

In fact, anyone could roll their own financial networks without using banks/Visa/you name it. No one has because we've made laws that specifically increase the barrier to entry because finance is the spine that provides support for all manner of economic activity, which includes the illegal stuff, and Government is putatively in the business of making sure that the illegal stuff doesn't see the light of day.

I just do not see the compelling argument that'll carry weight to switch someone from "financial system that makes crime hard" to "financial system that makes crime easy" and feel alright about it. You have to already accept that crime is just an endemic human phenomena, and this is just a rebalancing of the spectrum.

Given you've got much more efficient implementations of your other use cases available, this is the sticking point for me. No people I've spoken to and laid out what Web3 really is, even with the most charitable framing gets passed that.

If I can't convince people it's a good idea with full disclosure in effect, I'm not sure it's something worth pushing forward.

[r00bot]

I don't really think there are five applications it excels in, but there might be in the future..?

Like I said, we're still working out what it's good for. I've seen promising applications but nothing I'd say is obviously better than traditional technology. To dismiss the entire technology because of (admittedly a lot of) grifters is premature in my opinion.

[dmitriid]

You said it has applications it excels at. Turns out "maybe in the future" and "we're still figuring out".

So. No applications it excels at.

> To dismiss the entire technology because of (admittedly a lot of) grifters is premature in my opinion.

It's been 13 years. When will dismissing it become mature? In another 13 years?

Or maybe the tech is just bad.

[EGreg]

So Web2 has gotten such a bad name due to centralized bullshit that entire democracies are up in arms. And the Zucks of the world just say “Calm down. Breathe. We hear you” and proceed to continue to do the very thing people have been mad about (Libra? Beacon?)

https://en.wikipedia.org/wiki/Facebook_Beacon

Zuck correctly described the situation early on: “I don’t know. They ‘trust me’. Dumb f#%ks”. And it’s still true today and you want to bury any alternative to that system.

[kuramitropolis]

>Crypto-enthusiasts ignore how regulations existed for good reasons before regulatory capture made a mess of things.

What way do you propose out of regulatory capture?

[NoGravitas]

Transparency laws, stricter regulation on moving between regulatory agencies and regulated industries, in general, better democratic accountability. All of these are imperfect, but it's also the case that cryptocurrency doesn't make any of it better.

[kuramitropolis]

>stricter regulation on moving between regulatory agencies and regulated industries

You seem to assume the existence of a competent and non-corrupt metaregulator (some form of supervisory body that would "regulate the regulators" and somehow prevent "revolving door" scenarios).

- If it exists, why was long-term regulatory capture possible in the first place?

- If it doesn't, how would we go about instituting one?

We're on Hacker News. Exit wishful thinking, enter systems thinking.

- Feedback between regulatory agency and regulated industry: continuous.

- Feedback between regulatory agency and supervisory body: continuous.

- Feedback between supervisory body and sovereign (=the general public getting shafted by the regulatory capture): discrete, and of appalingly low resolution.

I'm told that in the world's dominant democracy, where most of the ideas that we're discussing originate, the sovereign is throttled to expressing its interest in the form of a binary decision once every ~35000 hours.

So, the boffins at the revolving door email each other and call each other on the phone all the time, but the public can only talk to the legislature at the grand rate of 1 bit per 4 years? In that case, I'm prone to applying the concept of "regulatory capture" to any and all regulation that nominally serve the public interest. They simply don't have the bandwidth to establish what the public interest is.

Even at Bitcoin's "low" speed of 7 transactions per second, on-chain voting would still support a much faster democratic process. That's why people are opposed to it. For now, people use cryptos to vote mostly on inconsequential things. That's while the quirks are being ironed out. Some crypto bros who got in for teh gainz got shafted. So what. Maybe in a fairer economic system a fool and his money would be parted even more easily.

Currently, crypto does not work... except as a public "exit"/"no confidence" vote towards the methods through which industry is organized and regulation is instituted. For one to devote time and effort to this emergent form of economic organization, no matter how uncertain its realities might be, is simply to refuse to take part in maintaining a status quo that one has had no part in establishing - and to look for alternatives, no matter how tenuous.