1. 32

    The author notes in the original SA thread that this is really pretty normal. Anyone here knows perfectly well what horrors lurk under the shiny surface of most things that run on computers, and that civilisation is held together by hasty gaffer tape. It was an idle SA engineer war story, not something intended to be newsworthy.

    1. 2

      I used this on [[List of software forks]] too, it’s a great illustration of forking!

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

      1. 3

        ““Against the average user, anything works; there’s no need for complex security software. Against the skilled attacker, on the other hand, nothing works.””

        I want to note that this is actually wrong. There’s all kinds of devices I can’t access or understand to the degree I want. This is especially true if it’s implemented in, totally or partly, silicon instead of software. The other times it requires esoteric knowledge of stuff like RF. These secrets stay secret for long periods despite billions of dollars of volume with hackers being in possession of the devices. They effectively solved the trusted client problem for those secrets with the one technique that works: defeating it costs piles of money. Money to tear the chips down, money on rare specialists, money on common specialists, and lots of time.

        So, it’s true if you say “against a skilled attacker with necessary time and money.” In many cases, they might not have the time and money. Quick example: FBI paid Cellebrite something like $100-200 grand to crack that iPhone. So, if iPhone implements DRM, your data is secure on them if your enemy can’t afford or won’t spend $100-200 grand to get it. Then, they downgrade to having to use cameras aimed at the screen, retype documents by hand, try to get exploits into apps, try to con people, etc. For media, both quality expectations and laziness can ensure the “cam” copies have minimal impact on sales. So the DRM works in that case against main audience even with smart hackers in possession of the device.

        1. 2

          Sounds pretty true to me? Even Apple with their untold billions can’t keep the iPhone secure enough that a couple of hundred grand can’t crack it.

          1. 2

            Apple doesnt care about secuurity. Their Macs were a decade behind others in security features at one point. The iPhones have a few features that help. Neither those nor the OS are implemented in a rigorous way. You could say they just added a few things with average implementation effort. And that half-ass job on a few things takes several hundred grand a year to beat.

            Now, lets say they invested in medium-to-high-assurance additions to CPU, security co-processor, and OS. They have the money to attempt it. Ive seen startups and CompSci folks on small budgets build each item. Apple might knock out whole categories of risk with a few million to tens of millions spent one time. They had tens of billions. They didnt do it. So, they dont care. That simple. Theirs stuff will sell anyway, too.

          2. 1

            True, you can attach a dongle costing a few hundred dollars ;-)

            1. 2

              Uses DongleCoin so there’s no single point of failure.

          1. 3

            I find the correct answer is both. You get different sorts of questions, too. Both are very informative as to what’s actually concerning people.

            Absolutely necessary: a moderator who can be the bad guy for you, who will cut off lightning-talks-from-the-floor. “A question is a single sentence that ends with a question mark.”

            1. 29

              Honestly I’d cut them some slack. It’s easy to assume that a company their size just has all the money to pay for testing and qa and expertise.

              But the truth is it’s probably just a handful of engineers who are passionate about playing well in the Linux ecosystem who will probably fix this and not make the mistake again.

              1. 6

                100% this.

                The OP should assume its a mistake and not malice.

                1. 10

                  It’s not as if the debian packaging rules are simple and easy to understand.

                  1. 5

                    I think if you didn’t know that forcibly removing whatever was at /bin/sh was bad, then no packaging rules can save you.

              1. -10

                Since joining Lobsters you’ve contributed virtually nothing but your own blog posts, a one man propaganda campaign attacking proof-of-work ad nauseam.

                It reminds me of Mike Hearn, famous for spreading disinformation to socially attack Bitcoin.

                I’m always curious about people who spread disinfo while censoring comments to their blogs that correct or disagree with them, and repeating ad nauseam, arguments that have been proven false/misleading multiple times. It seems you create problems in other communities too, whether it’s Wikipedia or RationalWiki.

                1. 12

                  For the benefit of anybody who skims the parent comment without checking, I’d like to mention the following:

                  • It doesn’t link to Wikipedia or RationalWiki, but to wikipediareview.com and matthewhopkinsnews.com.
                  • Following the links and allegations on those two pages does not turn up any actual misdeeds on either Wikipedia or RationalWiki.

                  @itistoday: have you noticed that you act very different on Bitcoin posts? Here’s what it looks like from the outside: most of your comments are helpful and courteous, a credit to any forum. But when you have commented on posts that criticise BitCoin, your comments seemed upset (and I don’t mean passionate, I mean hostile); you cited tweets and rants (above); and one comment even came across as mistrusting anyone who questions you. You don’t have to reply to me, but is a different attitude on Bitcoin something you’ve noticed yourself?

                  1. -7

                    Following the links and allegations on those two pages does not turn up any actual misdeeds on either Wikipedia or RationalWiki.

                    OK, what is this then?

                    Gerard also had his CheckUser and Oversight flags revoked on Wikipedia. According to the Register, after legal threats, a deal was brokered – Wikipedia removed their critical ruling explaining their decision on advice from their lawyer (who conceded it might appear procedurally and in some respects factually unfair) but in return Gerard agreed to resign the user rights. A full Register article is here (archive here).

                    And how is libel not a misdeed?

                    Mr Gerard has not responded nor denied any of the asserted facts. Gerard was offered an extension of the deadline if he had any concerns. It was explained that UK law requires libel claimants to mitigate losses (See Mawdsley v Guardian Newspapers Ltd [2002] EWHC 1780 (QB)). Being offered the facts before publication (and an extension to take advice), a subject has the opportunity to 100% mitigate losses. Mr Gerard is a press officer and is familiar with his rights.

                    Re:

                    You don’t have to reply to me, but is a different attitude on Bitcoin something you’ve noticed yourself?

                    Of course. Most of the other subjects I engage on do not involve banks and/or intelligence agencies spending millions/billions on hiring troll farms and saboteurs to spread disinfo or in some other way sabotage the work in question. 😂

                    1. 5

                      Downvote, move on, and remember the Streisand Effect.

                      1. -8

                        Downvote,

                        OK, I’ve downvoted you for being off-topic.

                        move on

                        I think that would miss the point of having an online discussion community. If someone were spreading disinfo (as David is gallantly doing) in a subject area I’m not familiar with, I would very much appreciate commenters who pointed that out.

                  2. 5

                    Thanks for your contribution! Anything to discuss on the topic at hand? You have the knowledge to bring to the subject.

                    while censoring comments to their blogs that correct or disagree with them

                    No, I’m still not letting your random abusive comments through, sorry. (He tries to comment on my blog like he comments here.) There are plenty of other places for you to comment.

                    1. -2

                      Anything to discuss on the topic at hand?

                      Yeah, how about you fix this sentence and the blog post it links to:

                      Proof-of-work is a horrifying disaster.

                      You keep saying that, and people keep telling you why you’re completely mistaken, and you just ignore them. So, you are knowingly, deliberately misleading people.

                      1. 3

                        Your previous attempt to show I was wrong, and Proof-of-Work was good actually, was to link some tweets and to be abusive when people told you that wasn’t really much of an argument.

                        Anything to say about this exciting new wave of not-a-blockchain coins? Just to get back onto the current topic, rather than some other topic, ad hominems or random abuse.

                        1. -2

                          was to link some tweets and to be abusive when people told you that wasn’t really much of an argument.

                          Wrong. This is me linking to some tweets.

                          In the link you just posted, are links to technical arguments explaining why “proof-of-work is wasteful”, is nonsense. It’s not like you are the first person to say this, so instead of copy/pasting a whole bunch of text, I linked you to it.

                          That you’re playing dumb proves again you’re here to troll.

                          You’re taking a feature of a currency — its ability to transparently and easily measure how much energy it’s using for its security — something no other global currency-system has been able to provide — and are pretending this feature is a bad thing. That’s your entire, bullshit argument. It’s nonsensical to the extreme.

                          Anything to say about this exciting new wave of not-a-blockchain coins?

                          One thing at a time! There’s no sense in talking with someone who can’t demonstrate they’re capable of honest conversation. Let’s wrap up that “proof-of-work is wasteful/bad” nonsense before wasting more time.

                    2. 4

                      Contributing ones own work is not against the rules for this site. In fact there’s a checkbox indicating whether one is the author of a submitted link.

                      It’s up to the community to decide whether the link is on topic or not.

                      1. -3

                        Contributing ones own work is not against the rules for this site.

                        Nobody said it was.

                    1. 8

                      A big part of your post is how these protocols don’t even run or survive network conditions. In the centralized model, one of my favorites was FoundationDB. The testing section shows their development process was so rigorous that the guy who runs Jepsen testing on databases didn’t bother testing it since he’d be throwing less at it. In this recent presentation, one of our Lobsters applies similarly rigorous approaches in their work with memory-safe language on top of it.

                      In comparison, these math coins often look like they’re not even trying. The activities I described found lots of failures in distributed software with benign components. Many more can happen when some parties are malicious intelligently crafting bad inputs. What’s their excuse for decentralized stuff not being as rigorous by default as centralized stuff like I cited? I doubt they’ll have a good one.

                      1. 5

                        When these huge and glaring problems are raised, most of the counterargument is “number go up”. Certainly that’s what the IOTA cult comes out with, in between the harassment and legal threats.

                        The big promise is doing the Bitcoin magical flying unicorn pony tricks without wasting an Ireland of electricity. This feels to me like there’s gotta be some sort of no free lunch effect in play, though I wouldn’t claim to be able to prove it.

                        At least a non-zero number of these guys are more or less sane. They might be wrong or do something dumb, but at least it’ll be an informed wrong.

                        I was in polite mode for this post, but mathcoin white papers should mostly be read as mad scientist villain monologues. “They said I was mad - but I’LL SHOW THEM ALL!!” edit: actually, I’ll just go add that!

                        1. 1

                          RE the no free lunch:

                          For RaiBlocks, the trade-off is that it’s so decentralized that you can’t have a full view of the state of the universe.

                          Each user has its own blockchain, so you only need blockchains related to transactions that interest you. (Transactions are movements between blockchain, starting with a genesis chain that everyone knows about)

                          Basically the system works in partial information, but that means that the system will only be partially visibile depending on where you stand

                        2. 2

                          Empirical fault tolerance testing (as used for simpler and totally solved problems like in your examples) is insufficient for analyzing malicious party actions. Unfortunately, though, no one has come up with a clean mathematical framework for capturing all the intricacies of the economics of the system, so the math is still pretty ugly.

                          1. 4

                            Empirical testing in that model is just about seeing if any inputs can throw off specified behavior. One tool among many but pretty good at finding problems.

                            In the traditional models, the builders ensure actions are traceable and revocable with boundary conditions or sanity checks built into the system. Then, they monitor for abuse. They block or reverse what they detect. This system works pretty well in practice. Pieces of the underlying methods have been formally verified as well. The math might be ugly for blockchain-based methods but not for the core of traditional models with decentralized checking and incident response. It’s why I favor designing around the latter.

                            1. 2

                              No amount of empirical testing is convincing if the mathematical model is not sound. In central authority systems the math is quite straightforward and the testing reveals implementation inefficiencies and bugs. In new and complex trustless systems the math is still pretty suspect, so care and effort need to be spent there instead. This is why the two look very different at the moment.

                              1. 4

                                Again, Im saying empirical testing can find problems in protocols or other software, not that it should replace math. Also, that it finds problems the math might not find. It can also be used to test math or its instantiation, though.

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                          I’m sure there is good content in this post, but I gave up looking for it after two minutes of scrolling through puns…

                          1. 4

                            It’s the style of the page that drives me away. I’d appreciate it a lot if it would just pick a colour scheme.

                            And yeah, this is griping, but there’s some useful information buried in the showmanship here.

                            1. 3

                              Firefox Reader Mode is your friend.

                            1. 13

                              “Truly immutable timestamps could be useful”

                              As with most stuff, there’s already a standard for that. One company, Surety, even puts the hash of their timestamp ledger (hash chains) in the New York Times to create a paper trail. I’m sure the decentralized checking part could be scaled horizontally a bit without much change in protocol or energy usage. The individual operations are still simple enough to do on chips that are a few bucks each.

                              1. 7

                                there’s already a standard for that. One company…

                                The big feature that Bitcoin and other blockchains bring to the table is decentralization. If you can rely on a company for stewardship of your ledger, then by all means use a permissioned database like Surety does.

                                On the trusted timestamping page you linked, if you skip to the decentralized section, you can see it immediately starts talking about Bitcoin.

                                I’m not sure how much Surety’s service costs, but piggybacking on the Bitcoin or Ethereum blockchains is likely far cheaper. Here is a tutorial on how to store a message as an Ethereum contract. The cost is variable with the string length, but in this case only cost about $0.20. It works by deploying a solidity contract that is just a couple string variables. The output is observable on etherscan.

                                1. 4

                                  In my model, several foundations in different countries run by different people would agree on a protocol. It would store stuff in SQLite, FoundationDB, or something similarly fast/resilient. A web or app server with plenty of cache would give snapshots of the ledgers. They’d charge a fixed price for bandwidth and storage which could go up as the tech improves.

                                  This setup for something small like hashes with a niche audience could run on $5/mo VM’s. Even dedicated servers, 5-way redundancy with years of compute, storage, and bandwidth would be just over a $1,000 a month. The components theyd use are so vanilla the admins could be part-time. How much does Ethereum or Bitcoin cost in comparison?

                                  1. 4

                                    Check it out, this message cost $0.80. Zero sysadmin effort on my part due to leveraging a preexisting system. Also, the message won’t vanish if I stop paying VPS bills.

                                    If you’re a large corporation that wants to timestamp thousands or millions of messages, the centralized approach could very well be cheaper. For me, verifying maybe a handful of messages per year, it’s way easier to piggyback on a large blockchain project.

                                    1. 4

                                      That’s a decent point. If you’re just externalizing and aimjng for low cost, you can post the messages in threads of diverse forums, Pastebin, etc. I used to do that with hashes on blogs. Never cost a cent.

                                      1. 3

                                        verifying maybe a handful of messages per year

                                        What’s your actual usecase for this? I struggle to see viable usecases for the blockchain beyond speculation so it’s interesting to hear what people consider are valid usecases for it.

                                        1. 2

                                          I should have worded that differently… I don’t timestamp messages all that often. What I meant to convey is that $1000/mo is definitely overkill for anyone with intermittent needs.

                                          Pastebin and forum posts are fine, but centralized. If Pastebin ever goes down, or starts manipulating old posts, then the integrity of your verification is compromised. Embedding the message in Ethereum’s blockchain is a much stronger guarantee of permanence and immutability.

                                          What sorts of blog posts need such tamper-proofing? Anything dealing with warrant canaries, reverse engineering, or low-level firmware might deserve it.

                                          1. 3

                                            I should have worded that differently… I don’t timestamp messages all that often. What I meant to convey is that $1000/mo is definitely overkill for anyone with intermittent need

                                            The $1,000/mo is for the hardware and bandwidth to run the alternative to a blockchain. In the blockchain, you’re a user that pays for a tiny portion that you use. In the alternative, you’d similarly pay for a tiny portion that you use. Maybe a membership fee that covers general cost of operations with you paying the usage parts at cost. I gave the examples of $5 VM’s to illustrate the difference between whatever Bitcoin is doing for mining or transactions. I imagine it takes a bit more hardware than $5/mo.

                                            The other article today said companies were paying $10,000 a unit for what supports this system. My hypothesis was getting orders of magnitude better performance with a year of usage at the same price with five-way checking. Adding actors that don’t trust each other just adds small amounts to the system without dragging down the speed of its main DB’s. Whereas, the folks buying the ASIC’s are spending tens of millions to support almost nothing in terms of transactions. The traditional tech is so cheap that I was using blogs to do my version of it. They didn’t even notice. That’s the difference between crypto-currency tech and traditional tech w/ decentralized checking.

                                            1. 3

                                              Pastebin and forum posts are fine, but centralized. If Pastebin ever goes down, or starts manipulating old posts, then the integrity of your verification is compromised. Embedding the message in Ethereum’s blockchain is a much stronger guarantee of permanence and immutability.

                                              It doesn’t solve the permanence problem, but just signing text is sufficient to address tampering, which doesn’t use a lot of electricity. So is being permanent the selling point? There is also ipfs which doesn’t require PoW but is decentralized, would that + signing be sufficient for your needs?

                                              Basically, I’m still struggling to figure out what the blockchain does that makes the excessive energy usage worthwhile. Maybe I’m just being narrow minded, but I still only really see financial speculation as the primary motivator, so if that becomes unviable, why would anyone continue to run a bitcoin node (and there goes the permanence?)

                                            2. 1

                                              Yeah, you’d really need to know the use case to try to use it as justification for the Bitcoin blockchain and all its baggage. As the full quote from the linked article says:

                                              Truly immutable timestamps could be useful — assuming anyone finds a timestamp use case so important that it warrants a country-sized percentage of the world’s electricity consumption.

                                              1. 2

                                                Ah, sure. Immutable timestamps are a fun way to piggyback on the existing Bitcoin and Ethereum blockchains, but timestamping by itself is not a justification for those coins existing.

                                      2. 3

                                        plenty of hype here too: https://guardtime.com/ for example

                                        1. 3

                                          Oh Lord… they gotten bitten by the bug. No surprise, though, since it’s a fad with momentum and lots of money. I expect any company that can do a blockchain product to build one just to make money off it. Given their prior work, there’s little reason to think they actually needed a blockchain vs hash chains with distributed checking and/or HSM’s. Just cashing in. ;)

                                          Btw, do check out that Functional-Relational slide deck I submitted. It shows the Out of the Tar Pit solution is essentially what the new, GUI frameworks are doing. It was just years ahead. So, maybe some practical uses for some version of their model.

                                          1. 5

                                            Guardtime’s KSI Blockchain is probably my favourite blockchain hype. The product was first released in 2007 and they only branded it “blockchain” a few years ago … for marketing reasons.

                                            I have a post about it here. In one of their white papers, they literally redefine “blockchain” to mean containing a Merkle tree:

                                            Unlike traditional approaches that depend on asymmetric key cryptography, KSI uses only hash-function cryptography, allowing verification to rely only on the security of hash-functions and the availability of the history of cryptologically linked root hashes (the blockchain).

                                            I hear cryptocurrency people touting Estonia’s BLOCKCHAIN REVOLUTION as great news for Blockchain, and even great news for cryptocurrency. It’s not even a blockchain.

                                            I mean, I have no reason to think there’s anything wrong with it. I’m sure it does its job just fine. But goodness me, it’s the greatest marketing success “blockchain” the buzzword ever saw.

                                            1. 4

                                              If anything, it was a great way to show we didnt need a blockchain when our older concepts were working fine. They might benefit by using the buzzword. Yet, such misleading usage just reinforces the phenomenon where the BS spreads further.

                                              Im not even sure it’s reversible at any level given these fads usually either level off or implode with the name and reputation damage permanently attached to whatever the name touched. AI Winter, expert systems, and Common LISP are some of best examples.

                                              1. 1

                                                There’s probably a post I need to write on this topic: basically, we’re going to see a resurgence in the popularity of linked lists with hashes, and they’re going to be branded “blockchain(tm)”. There are a few non-bogus projects along these lines, but it’s not so great actually and in all cases they should have just used a frickin database.

                                                Likely case, we get mostly-working systems that have an eternally painful “blockchain(tm)” implementation at the core that can’t easily be replaced by something sane.

                                        2. 2

                                          I had no idea about surety or even the ability to do that — thanks!

                                          1. 3

                                            Sure thing! Trusted timestamping is actually one of my goto examples for hash-chain-using tech that predates blockchain craze. What timestamping-on-blockchain folks hope to achieve is what such companies have been doing reliably and efficiently for years now. Better to just invest in and improve on efficient models that already work.

                                          2. 2

                                            The standard isn’t the hard part, the trust is.

                                            How much money would it take to bribe the Surety employee who has the fewest scruples? That’s about the ceiling for which you can bet on their authentication service.

                                            1. 4

                                              The thing I push is centralized, standard ledgers with decentralized checking. For Surety done that way, it would take you bribing all the checkers. Alternatively, the HSM’s can mitigate some of the insider risk.

                                          1. 3

                                            I’m always curious about the intended audience with these types of posts. The posts typically paint a straw man picture that there are people unwilling to change the operating model to be more efficient given the option, which is absurd. Should we abandon bitcoin? Is that the thesis here?

                                            Clearly the non technical people would probably not know PoW is inefficient but they also have little to no control over the dominance of bitcoin and the way it works. There are strong economic incentives for actors supporting the current structure to keep supporting it as is and the blog post does not address this problem at all.

                                            1. 7

                                              The cryptocurrency posts themselves paint a strawman that we cant do anything better than corrupt, for-profit, centralized tech unless we switch over to blockchains. That’s a lie with many counterexamples. Bitcoin itself also has huge hype and drawbacks in practice.

                                              The author is highlighting that hype and drawbacks. He’s also highlighting a social phenomenon where many proponents try to talk like bad things are good things to downplay them. I’d straight up call that fraud since they’re trying to get people’s money.

                                              1. 5

                                                I understand that you have a strong opinion on the subject but you’re essentially calling anyone who has an interest in decentralized systems a fraudster. I think it’s disingenuous to say “people who have interests different from my own are by definition fraudsters”.

                                                Decentralized, trustless systems have important applications. Bitcoin was created as a response to the banks being involved in widespread fraud. Calling Bitcoin users frauds seems to miss the point in the largest way possible.

                                                1. 2

                                                  “ Bitcoin was created as a response to the banks being involved in widespread fraud.”

                                                  So were credit unions and non-profits in response to earlier fraud. I don’t see a lot of them involved in things like 2008 crises. I thought even Bitcoin had a non-profit/foundation controlling or supporting it.

                                                  He’s also highlighting a social phenomenon where many proponents try to talk like bad things are good things to downplay them. I’d straight up call that fraud since they’re trying to get people’s money.

                                                  That was the key circumstance that I brought up fraud on. The need to use as much energy as Ireland to avoid unscupulous parties screwing up a few transactions a second is one such implication. It’s a total lie since the regular, banking system prevents or catches lots of stuff like that on a daily basis. From there, I pointed out in another comment that a system using regular databases and protocols with distributed checking might take a $5 VPS or one server per participant. Those don’t take the energy of Ireland, insanely-slow transactions, or crypto magic.

                                                  That the very-smart proponents of Bitcoin don’t investigate such options or tell their potential investors of such alternatives with their risk/reward tradeoffs means they’re more like zealots or con artists. I mean, most people might trust such alternatives since they’re using the regular financial system. They might love solutions that knock out all the real problems they’ve dealt with efficiently plus make plenty of headway on the more rare or hypothetical risks many cryptocurrency proponents worry about all night.

                                                  Save the best for last. If it’s Bitcoin, they might also want to know it’s primarily a volatile, financial instrument used for speculation instead of a stable currency they can depend on as its proponents are selling it. I know people who are day trading these things right now riding the hype waves profitably while the adopters driving them and sustaining the systems aren’t getting the much better thing people probably promised them. Many of them have also lost money they wouldn’t have lost storing currency in traditional, financial system. Looks like fraud to me.

                                                  1. 3

                                                    The need to use as much energy as Ireland to avoid unscupulous parties screwing up a few transactions a second is one such implication. It’s a total lie since the regular, banking system prevents or catches lots of stuff like that on a daily basis. From there, I pointed out in another comment that a system using regular databases and protocols with distributed checking might take a $5 VPS or one server per participant. Those don’t take the energy of Ireland, insanely-slow transactions, or crypto magic.

                                                    It sounds like you might endorse the notion that PayPal is more effective than Bitcoin. PayPal supports more transactions per second, catches a lot of fraud, supports chargebacks when fraud does happen, and doesn’t require proof-of-work – it all runs safely on PayPal’s verified servers. This is all true, and for many people PayPal is fine enough.

                                                    However, the centralized nature of PayPal does have some problems. There’s always the risk of getting your account frozen, which has happened to countless people. Minecraft made too much money in 2010. Wikileaks pissed off powerful entities in 2012. Google has over 600,000 results for “paypal accounts frozen”. I hear that PayPal freezes lots of crowdfunding efforts in particular.

                                                    What it comes down to is trust. If you can trust the corporate entity PayPal to expedite your transactions and send you on your way, then the status quo is fine. But if you have a problem with PayPal, or PayPal has a problem with you, then you need to find an alternative.

                                                    You can see the same problem on a larger scale with the SWIFT network. Nearly every international interbank transfer takes place on SWIFT, and it works fine as long as everyone trusts each other. But if you find yourself on the wrong end of US sanctions, suddenly your banking system comes to a screeching halt. Russia, China, and Iran are all too aware of this problem and are trying to build alternatives. Russia is working on SFPS and China is building CIPS. They’re also both stockpiling gold; another asset that won’t freeze you out at a moment’s notice.

                                                    Bitcoin never freezes anyone out of their funds. If you have the private key, you control the bitcoin wallet, period. It’s math, not bureaucracy.

                                                    1. 4

                                                      “This is all true, and for many people PayPal is fine enough.” “However, the centralized nature of PayPal does have some problems”

                                                      You’re almost there. The centralized solution like PayPal works really well except in well-known failure modes. SWIFT is another good example I bring up myself in these discussions as better than Bitcoin so far. There’s centralized companies, esp credit unions or nonprofits, that aren’t doing all the shady stuff PayPal does. That’s by design. There’s cooperatives leaner than Swift, too. So, the logical, first thing to explore is how to mix those protections with centralized companies like PayPal. If we do decentralized, the first thing to explore should be proven tech for centralized case with distributed checking maybe at a granularity of participating organization like with banks and SWIFT. So, so, so much more efficient to do that.

                                                      Instead, cryptocurrency proponents paint a false dilemma between for-profit, greedy banks vs distributed, energy-sucking, blockchain system. It’s misleading given all the designs in between. Not to mention they seem to only focus on what for-profit, scumbag banks do instead of what centralized organizations designed for public benefit can do. A little weird to sidestep the whole concept of nonprofit, consumer-focused banks or companies, eh? It’s like they want a specific solution ahead of time looking for justifications for it instead of exploring the vast solution space trying to find what works best for most peoples’ goals.

                                                      “Bitcoin never freezes anyone out of their funds. If you have the private key, you control the bitcoin wallet, period. It’s math, not bureaucracy.”

                                                      You’re telling me Bitcoin ledgers, exchanges, and/or hardware can’t be blocked or made a felony in a country. I doubt that. Hell, the mining situation makes it look more like a traditional oligopoly. I can’t remember if they’re all in China or not. That would be even worse given it would be an oligopoly whose companies are under control of one government that’s not about libertarianism and greater good. There’s currently more diverse control and subversion difficulty in traditional, banking system right now if not doing business with banks that are scumbags. I’d avoid any of them on the bailout list to start with.

                                                      1. 2

                                                        Good points all around. On second thought, what you’re describing sounds less like PayPal and more like Ripple.

                                                        In May 2011, [the creators of Ripple] began developing a digital currency system in which transactions were verified by consensus among members of the network, rather than by the mining process used by bitcoin, which relies on blockchain ledgers. This new version of the Ripple system was therefore designed to eliminate bitcoin’s reliance on centralized exchanges, use less electricity than bitcoin, and perform transactions much more quickly than bitcoin.

                                                        It’s targeting the interbank/SWIFT space, and purports to “do for payments what SMTP did for email”.

                                                        1. 2

                                                          Oh yeah, I loved their concept when I looked into this stuff. Interledger was my favorite concept but Ripple stood out, too. Obviously, I have some technical disagreements but they’re going in much smarter direction. Their marketing said you can pay for stuff with quick settlements, multiple parties checking stuff, and none of Bitcoin’s energy problems. The quick settlements in a global system probably being the main, selling point for most customers.

                                              2. 7

                                                there are people unwilling to change the operating model to be more efficient given the option, which is absurd

                                                There are absolutely lots of these people unwilling to change the operating model to be more efficient given the option. This is why I looked for claims from reasonably noteworthy bitcoiners and not random nobodies - though the random nobodies use the same arguments, and quote the noteworthy arguments - and linked and quoted them at length to make it clear that this is not straw but actual arguments they make in real life. This is all real. I’m not sure how I could make that clearer.

                                                1. 1

                                                  I don’t see a quote about choosing PoW over efficient alternatives. All the claims quoted in your post all seem to be something along the lines of “the benefits of proof of work are worth it.” To these claims you respond with the argument that they are “highly questionable to anyone who isn’t already a Bitcoin fan.”

                                                  From my read I’d say you do not address the claim that immutability and a shared transaction concensus is useful with any sort of reasoning or argumentation, just a slew of examples meant to bring doubt in the readers mind. You use terms like “waste” to describe the use of energy, which clearly reveals the a priori and entirely unargued assumption that it is not worth it. A better approach would be to lay down a reasonable framework for analysis and explain the limits of immutability and the price being paid for it within that framework.

                                                  Ultimately, I still don’t quite understand the thesis of this post. Why should the externality of energy expenditure be regulated by the economics driving it (proponents of PoW blockchains) and not governments?

                                              1. 3

                                                And Unix line endings! Hands up all those who spent days chasing down a breakage that turned out to be someone editing a Linux file in Notepad (raises hand)

                                                1. 4

                                                  Notepad adds a BOM if you save it as UTF-8, it’s one of the few things that does that. It’s wasted dozens of hours on a project that I’ve worked on.

                                                  1. 2

                                                    I added an automated test to our codebase that would check for BOM in SQL-files, which Windows wielding colleagues apparently were editing in Notepad. I never knew how they did it; thanks!

                                                1. -2

                                                  Proof-of-work cryptocurrency mining is bad, stupid and damaging.

                                                  In the words of the author, people who spread this nonsense without substantiating it and addressing the arguments why it’s wrong are “bad, stupid, and damaging”.

                                                  1. 5

                                                    Your link doesn’t make a claim, it’s just a link to a Twitter search saying proof of work is good. Did you mean another link?

                                                    1. -2

                                                      Your link doesn’t make a claim

                                                      I posted four links.

                                                      1. 10

                                                        So you did, sorry!

                                                        One link compares, literally, the entire financial system and everything it does to Bitcoin, and asserts - without numbers - that surely Bitcoin is more energy efficient than the existing system. (The other links are blank slogans.)

                                                        Since you can’t be bothered making an effort post, I will:

                                                        In 2015, there were approximately 430 billion cashless transactions.

                                                        The world produced about 24,000 TWh of energy in 2015 - oil, gas, coal, renewables, the lot.

                                                        If Bitcoin handled all of those transactions at 215 kWh per transaction, that’d be about 10,000 TWh - or about 40% of all the energy in the world.

                                                        Does the existing financial infrastructure consume close to 40% of all energy? I strongly suspect it doesn’t.

                                                        Those numbers are, of course, fuzzy as hell. Feel free to post better ones, or indeed any.

                                                        1. -6

                                                          without numbers

                                                          This was addressed in the second and third links, which you haven’t really responded to. I’ll wait for that thank you.

                                                          The other links are blank slogans.

                                                          No, they aren’t. They make very technical arguments on a variety of topics. This is self-evident to anyone who bothers to visit the links. So, this shows you’re a dishonest person, with no argument.

                                                          If Bitcoin handled all of those transactions at 215 kWh per transaction, that’d be about 10,000 TWh - or about 40% of all the energy in the world.

                                                          That’s not how Bitcoin handles such a volume of transactions. Bitcoin’s blockchain is literally designed to not be capable of handling that many transactions. Thus, your point is again moot.

                                                          And yet, pretty soon “Bitcoin” will be handling that number of transactions, and it will be doing so at far less than “215 kWh per transaction” or whatever number you invent. It has already begun.

                                                          Again, you’re just showing your immense ignorance of this subject.

                                                          1. 3

                                                            And you’re being rude. Please either engage positively or don’t post at all.

                                                            1. -2

                                                              You and the OP are the ones being rude.

                                                    2. 5

                                                      A bunch of Twitter links do not an argument make.

                                                      1. -5

                                                        If you know how to read they do. I see Lobsters has been infested with trolls.

                                                      2. 4

                                                        You’d have done better just highlighting the one link that makes your points best. That’s this one. It actually has good points if we’re comparing Bitcoin to the existing financial system. It’s misleading, though, given it counts every card or chip used in the main financial system… tiny, cheap things… without counting all the devices that would be necessary to securely do Bitcoin. I bet the computers or embedded devices Bitcoin users use cost more to make than smartcards with 16-bit MCU’s connecting to standard servers over secure tunnel.

                                                        The no branch and cash advantages do exist against most banks. Your comparison leaves off those where they don’t: branchless banks (i.e. online banks) or digital payment systems (i.e. Venmo or Paypal). Unlike the cryptocurrencies, those centralized alternatives grabbed plenty of the bankers’ market with one becoming a transforming force when partnering with eBay. PayPal achieved its goals by fixing real problems people had with the financial system using easiest methods possible reusing what was already proven to work. That’s what alternatives should be doing. The cryptocurrencies seem to only look much better in performance and energy usage if compared to the most inefficient, wasteful models in centralized finance. Compared to the digital ones (esp lean ones), they don’t have strong advantages for most users: only disadvantages like slower transactions, more energy use, more costly computers, riskier protocols due to higher complexity, lower longevity, and unclear risk on disputes if it hits a court.

                                                        (@David_Gerard, you might find this last one useful later.)

                                                        I’m saving the best part about your comparison for last: it should be an AND instead of an OR. It’s totally wrong to compare them in isolation. Bitcoin is a failed currency primarily used for speculation with intent to get someone richer in an existing currency (i.e. the financial system). It and most cryptocurrencies also use the existing financial system for investments into them, payments, the devices they run with, their energy use, cash backing of some assets, conferences/meetups, and probably your personal account on Patreon. The crypocurrencies are using the current financial system to bootstrap their vision of the future (or just defraud people… it varies). Until a transition happens, crypocurrencies need their energy use and the existing financial system’s energy use. They combine. It’s not one or the other until cryptocurrency users or developers are no longer using the financial system. That is quite a long shot even harder to believe than crypocurrencies going mainstream to begin with.

                                                        1. 2

                                                          thank you! I have a lengthy effortpost in the works on proof-of-work and the bad excuses for it, and will definitely be noting that point :-)

                                                          1. -2

                                                            You’d have done better [..]

                                                            It’s absurd Lobsters allows this deceitful nonsense at all. The dude is spreading disinfo and knows he’s doing it.

                                                            1. 3

                                                              I just pointed out your link was spreading disinfo given it pretended Bitcoin operated in isolation instead of with the financial system. It’s a wasteful system that depends on and adds to everything you mentioned. It can only be said to use less energy if it’s self-sustaining and eliminated the other stuff by replacing it in the large. Instead, most Bitcoin use is happening side-by-side with it sustaining both systems. They add together.

                                                              1. -2

                                                                It’s a wasteful system that depends on and adds to everything you mentioned.

                                                                That’s not true. Bitcoin doesn’t have a single branch for example. I could go on, but I tire of arguing against liars. It’s not productive.

                                                                1. 3

                                                                  If it’s not true, then at least the following would be true:

                                                                  1. All personnel and hardware involved in Bitcoin are paid for only in Bitcoin. That’s development, mining, promotion, meetings, etc. It has replaced the financial system for at least its own needs among its own supporters.

                                                                  2. People move money into Bitcoin. It then stays there since the use Bitcoin as a currency. Most aren’t moving things into and out of the financial system to profit off of Bitcoin. It would just be a financial instrument in the regular, financial system being used like many others. It’s also fairly stable so your money isn’t here today and gone tomorrow.

                                                                  3. Bitcoin isn’t backed by physical cash at any level. You’d need the banks, Brinks, Fort Knox, etc at that point behind the scenes. Bitcoin could still vastly reduce amount of that but still depends on some of it. Hasn’t eliminated it.

                                                                  If any of these aren’t true, then Bitcoin is using the current, financial system to operate because it hasn’t replaced it or eliminated need for it. If No 1 is true, that’s especially interesting given they’re the people who say it will replace the current financial system. If it hasn’t for them, then why should rest of us depend on it?

                                                                  1. -2

                                                                    Bitcoin doesn’t depend on the current financial system. I’m not going to waste any time convincing someone as smart as you about that.

                                                        1. 1

                                                          This post presents quite a distorted picture. For instance,

                                                          Proof-of-stake is a bit too obviously “thems what has, gets”…

                                                          You need some way to qualify transaction validators. Bitcoin has demonstrated that economic commitment is a valid qualifier. It’s sensible to experiment with other forms of economic commitment, because as you point out, PoW is increasingly harmful as the network value grows. Has there ever been a resource allocation system where the allocators were not “them what has” in some sense, and no economic advantage accrued to them? At least in a cryptocurrency, this only applies to the validators, and the economic advantage is explicit, transparent, and accountable.

                                                          — so you have to convince the users to go along with it.

                                                          So, a completely voluntary system… Quite alien, compared to previous financial systems, but I kind of like that aspect.

                                                          It’s also as naturally centralising as proof-of-work, if not more so.

                                                          I’m not sure what you’re referring to here.

                                                          The other problem is that people routinely spend up to $99.99 to get $100 — thus, proof-of-stake will rapidly approximate proof-of-work.

                                                          That link describes stake grinding, and the long-since identified solution is described in the FAQ you link elsewhere in the post.

                                                          There’s a lot of similar distortions throughout the post, but it doesn’t seem worthwhile to point them out, since they are so blatant and the overall tone is so hostile and dismissive that I suspect most of them are deliberate propaganda.

                                                          1. 6

                                                            There’s a lot of similar distortions throughout the post, but it doesn’t seem worthwhile to point them out, since they are so blatant and the overall tone is so hostile and dismissive that I suspect most of them are deliberate propaganda.

                                                            It would be worthwhile to point them out nonetheless, OP is not the only person reading these comments.

                                                            1. 2

                                                              So, a completely voluntary system… Quite alien, compared to previous financial systems, but I kind of like that aspect.

                                                              I’m speaking in terms of convincing people the system is fair enough to bother participating in. As the rest of the post details, “number go up” has so far been sufficient.

                                                              Remember: the market doesn’t care about your ideology, only its own.

                                                              That link describes stake grinding

                                                              No, it’s general to economics. If there’s any way to spend toward even the slightest profit in any enterprise, someone will think that’s a viable business. An entry in a FAQ doesn’t make that go away.

                                                              There’s a lot of similar distortions

                                                              By “distorted picture “ and “distortions” I’m pretty sure you mean “doesn’t agree with me”. “Distortions” is what a believer says when they can’t quite support “incorrect”, let alone “meaningfully incorrect.”

                                                              I suspect most of them are deliberate propaganda.

                                                              If more than a negligible proportion of the populace agreed with you, then their interest in cryptocurrency would be greater than “number go up” and interest wouldn’t have gone away with the bubble. Jumping to conspiracy theories is unlikely to get you anywhere useful.

                                                              1. 1

                                                                If there’s any way to spend toward even the slightest profit in any enterprise, someone will think that’s a viable business. An entry in a FAQ doesn’t make that go away.

                                                                There isn’t any such way in a well-designed proof-of-stake system. The FAQ explains this, as you would see if you read it with care. Such systems are described in detail in the Ouroboros Praos and Algorand papers. (I’m sure Casper has a similarly detailed specification, I’m just not as familiar with it.)

                                                                By “distorted picture “ and “distortions” I’m pretty sure you mean “doesn’t agree with me”.

                                                                No. You could convince me otherwise by making a cogent response to my initial objections.

                                                                1. 4

                                                                  There isn’t any such way in a well-designed proof-of-stake system.

                                                                  Has any such system been deployed in the real world, and tested with real users? Plans have an unfortunate tendency not to survive contact with the enemy.

                                                                  1. 0

                                                                    Nothing big, yet, and caution about such plans is sensible. But that’s a long way from claiming proof-of-stake is fundamentally broken for transparent economic reasons.

                                                                    1. 0

                                                                      No, but there is no evidence such PoS system is impossible in principle. Saying, like David Gerard, it’s an axiom of general economics, is like saying it’s profitable to break public key cryptography, therefore all public key cryptography will be broken.

                                                                      1. 2

                                                                        Gerard says no such thing. The entire point of the article is that Casper is soon here, and it will probably work as designed.

                                                                        You are deliberately misquoting a comment regarding a specific argument against PoS, namely stake grinding.

                                                                        1. 0

                                                                          That link describes stake grinding

                                                                          No, it’s general to economics. If there’s any way to spend toward even the slightest profit in any enterprise, someone will think that’s a viable business.

                                                                          Since I’d already pointed out that stake grinding is no longer an issue, the only sensible way to interpret this is that Paul’s general economic arguments had some independent relevance.

                                                                          1. 2

                                                                            We shall see. I am very interested to see how Casper turns out when it’s exposed to the real world.

                                                                            1. 1

                                                                              What shall we see?

                                                                              1. 2

                                                                                Whether Casper enabled Ethereum to make a successful transition from Proof-of-work to Proof-of-stake!

                                                                                1. 2

                                                                                  We will also see whether “PoS will rapidly approximate PoW”. My current opinion is that it is possible, but unlikely.

                                                                  2. 0

                                                                    To respond to your subsequent edit:

                                                                    If more than a negligible proportion of the populace agreed with you

                                                                    A negligible proportion of the populace has read your post, and their opinion has no impact on its accuracy.

                                                                1. 10

                                                                  Like all good cryptocurrency security bugs, this isn’t new at all - here’s Greg Maxwell mentioning it three years ago (51:00 on): https://www.youtube.com/watch?v=TYQ-3VvNCHE&feature=youtu.be&t=3060

                                                                  1. 7

                                                                    oh gawd, and here’s a Bitcointalk user mentioning it in March 2013: “Patch the window.SecureRandom function, or the ArcFour PRNG inside it.”

                                                                    why is cryptocurrency like this

                                                                  1. 2

                                                                    These are probably the weakest arguments against Bitcoin I’ve seen. But the coolest bit about Bitcoin is that it is completely voluntary, so you do your thing, and we’ll do ours.

                                                                    Real arguments against Bitcoin are:

                                                                    And I’m sure there are others but literally none of the ones presented here are valid.

                                                                    1. 29

                                                                      These are probably the weakest arguments against Bitcoin I’ve seen.

                                                                      As it says, this is in response to one of the weakest arguments for Bitcoin I’ve seen. But one that keeps coming up.

                                                                      But the coolest bit about Bitcoin is that it is completely voluntary, so you do your thing, and we’ll do ours.

                                                                      When you’re using literally more electricity than entire countries, that’s a significant externality that is in fact everyone else’s business.

                                                                      1. 19

                                                                        I would also like to be able to upgrade my gaming PC’s GPU without spending what the entire machine cost.

                                                                        This is getting better though.

                                                                        1. 1

                                                                          For what it’s worth, Bitcoin mining doesn’t use GPUs and hasn’t for several years. GPUs are being used to mine Ethereum, Monero, etc. but not BItcoin or Bitcoin Cash.

                                                                        2. 0

                                                                          When you’re using literally more electricity than entire countries, that’s a significant externality that is in fact everyone else’s business

                                                                          And yet, still less electricity than… Christmas lights in the US or gold mining.

                                                                          https://coinaccess.com/blog/bitcoin-power-consumption-put-into-perspective/

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                                                                            When you reach for “Tu quoque” as your response to a criticism, then you’ve definitely run out of decent arguments.

                                                                        3. 13

                                                                          Bitcoin (and all blockchain based technology) is doomed to die as the price of energy goes up.

                                                                          It also accelerates the exaustion of many energy sources, pushing energy prices up faster for every other use.

                                                                          All blockchain based cryptocurrencies are scams, both as currencies and as long term investments.
                                                                          They are distributed, energy wasting, ponzi scheme.

                                                                          1. 2

                                                                            wouldn’t an increase in the cost of energy just make mining difficulty go down? then the network would just use less energy?

                                                                            1. 2

                                                                              No, because if you reduce the mining difficulty, you decrease the chain safety.

                                                                              Indeed the fact that the energy cost is higher than the average bitcoin revenue does not means that a well determined pool can’t pay for the difference by double spending.

                                                                              1. 3

                                                                                If energy cost doubles, a mix of two things will happen, as they do when the block reward halves:

                                                                                1. Value goes up, as marginal supply decreases.
                                                                                2. If the demand isn’t there, instead the difficulty falls as miners withdraw from the market.

                                                                                Either way, the mining will happen at a price point where the mining cost (energy+capital) meets the block reward value. This cost is what secures the blockchain by making attacks costly.

                                                                                1. 1

                                                                                  Either way, the mining will happen at a price point where the mining cost (energy+capital) meets the block reward value.

                                                                                  You forgot one word: average.

                                                                                  1. 2

                                                                                    It is implied. The sentence makes no sense without it.

                                                                                    1. 1

                                                                                      And don’t you see the huge security issue?

                                                                            2. 1

                                                                              Much of the brains in the cryptocurrency scene appear to be in consensus that PoW is fundamentally flawed and this has been the case for years.

                                                                              PoS has no such energy requirements. Peercoin (2012) was one of the first, Blackcoin, Decred, and many more serve as examples. Ethereum, #2 in “market cap”, is moving to PoS.

                                                                              So to say “ [all blockchain based technology] is doomed to die as the price of energy goes up” is silly.

                                                                              1. 1

                                                                                Much of the brains in the cryptocurrency scene appear to be in consensus that PoW is fundamentally flawed and this has been the case for years.

                                                                                Hum… are you saying that Bitcoin miners have no brain? :-D

                                                                                I know that PoS, in theory, is more efficient.
                                                                                The fun fact is that all implementation I’ve seen in the past were based on PoW based crypto currencies stakes. Is that changed?

                                                                                As for Ethereum, I will be happy to see how they implement the PoS… when they will.

                                                                                1. 2

                                                                                  Blackcoin had a tiny PoW bootstrap phase, maybe weeks worth and only a handful of computers. Since then, for years, it has been purely PoS. Ethereum’s goal is to follow Blackcoin’s example, an ICO, then PoW, and finally a PoS phase.

                                                                                  The single problem PoW once reasonably solved better than PoS was egalitarian issuance. With miner consolidation this is far from being the case.

                                                                                  IMHO, fair issuance is the single biggest problem facing cryptocurrency. It is the unsolved problem at large. Solving this issue would immediately change the entire industry.

                                                                                  1. 1

                                                                                    Well, proof of stake assumes that people care about the system.

                                                                                    It see the cryptocurrency in isolation.

                                                                                    An economist would object that a stake holder might get a lot by breaking the currency itself despite the loss in-currency.

                                                                                    There are many ways to gain value from a failure: eg buying surrogate goods for cheap and selling them after the competitor’s failure has increased their relative value.

                                                                                    Or by predicting the failure and then causing it, and selling consulting and books.

                                                                                    Or a stake holder might have a political reason to demage the people with a stake in the currency.

                                                                                    I’m afraid that the proof of stake is a naive solution to a misunderstood economical problem. But I’m not sure: I will surely give a look to Ethereum when it will be PoS based.

                                                                              2. 0

                                                                                doomed to die as the price of energy goes up.

                                                                                Even the ones based on proof-of-share consensus mechanisms? How does that relate?

                                                                                1. 3

                                                                                  Can you point to a working implementation so that I can give a look?

                                                                                  Last time I checked, the proof-of-share did not even worked as a proof-of-concept… but I’m happy to be corrected.

                                                                                  1. 2

                                                                                    Blackcoin is Proof of Stake. (I’ve not heard of “Proof of Share”).

                                                                                    Google returns 617,000 results for “pure pos coin”.

                                                                                    1. 1

                                                                                      Instructions to get on the Casper Testnet (in alpha) are here: https://hackmd.io/s/Hk6UiFU7z# . No need to bold your words to emphasize your beliefs.

                                                                                      1. 3

                                                                                        The emphasis was on the key requirement.

                                                                                        I’ve seen so many cryptocurrencies died few days after ICO, that I raised the bar to take a new one seriously: if it doesn’t have a stable user base exchanging real goods with it, it’s just another waste of time.

                                                                                        Also, note that I’m not against alternative coins. I’d really like to see a working and well designed alt coin.
                                                                                        And I like related experiments as GNU Teller.

                                                                                        I’m just against scams and people trying to fool other people.
                                                                                        For example, Casper Testnet is a PoS based on a PoW (as Etherum currently is).

                                                                                        So, let’s try again: do you have a working implementation of a proof of stake to suggest?

                                                                                        1. 1

                                                                                          It’s not live or open-source, so I’d understand if you’re still skeptical, but Algorand has simulated 500,000 users.

                                                                                          1. 1

                                                                                            Again I don’t seem to understand your anger. We’re on a tech site discussing tech issues. You seem to be getting emotional about something that’s orthogonal to this discussion. I don’t think that emotional exhorting is particularly conducive to discussion, especially for an informed audience.

                                                                                            And I don’t understand what you mean by working implementation. It seems like a testnet does not suffice. If your requirements are: widely popular, commonly traded coin with PoS, then congratulations you have built a set of requirements that are right now impossible to satisfy. If this is your requirement then you’re just invoking the trick question fallacy.

                                                                                            Nano is a fairly prominent example of Delegated Proof of Stake and follows a fundamentally very different model than Bitcoin with its UTXOs.

                                                                                            1. 3

                                                                                              No anger, just a bit of irony. :-)

                                                                                              By working implementation of a software currency I mean not just code and a few beta tester but a stable userbase that use the currency for real world trades.

                                                                                              Actually that probably the minimal definition of “working implementation” for any currency, not just software ones.

                                                                                              I could become a little lengthy about vaporware, marketing and scams, if I have to explain why an unused software is broken by definition.
                                                                                              I develop an OS myself tha literally nobody use, and I would never sell it as a working implementation of anything.

                                                                                              I will look to Nano and delegated proofs of stake (and I welcome any direct link to papers and code… really).

                                                                                              But frankly, the sarcasm is due to a little disgust I feel for proponents of PoW/blockchain cryptocurrencies (to date, the only real ones I know working, despite broken as actual long term currency): I can understand non programmers that sell what they buy from programmers, but any competent programmer should just say “guys Bitcoin was an experiment, but it’s pretty evident that has been turned to a big ponzi scheme. Keep out of cryptocurrencies! Or you are going to loose your real money for nothing.”

                                                                                              To me, programmers who don’t explain this are either incompetent enough to talk about something they do not understand, or are trying to profit from those other people, selling them their token (directly or indirectly).

                                                                                              This does not means in any way that I don’t think a software currency can be built and work.

                                                                                              But as an hacker, my ethics prevent me from using people’s ignorance against them, as does who sell them “the blockchain revolution”.

                                                                                          2. 2

                                                                                            The problem is that in the blockchain space, hypotheticals are pretty much worthless.

                                                                                            Casper I do respect, they’re putting a lot of work in! But, as I note literally in this article, they’re discovering yet more problems all the time. (The latest: the security flaws.)

                                                                                            PoS has been implemented in a ton of tiny altcoins nobody much cares about. Ethereum is a great big coin with hundreds of millions of dollars swilling around in it - this is a different enough use case that I think it needs to be regarded as a completely different thing.

                                                                                            The Ethereum PoS FAQ is a string of things they’ve tried that haven’t quite been good enough for this huge use case. I’ll continue to say that I’ll call it definitely achievable when it’s definitely achieved.

                                                                                    2. 4

                                                                                      ASICboost was fixed by segwit. Bitcoin isn’t subject to ASICboost anymore, but Bitcoin Cash is.

                                                                                      1. 2

                                                                                        Covert asicboost was fixed with segwit, overt is being used: https://mobile.twitter.com/slush_pool/status/977499667985518592

                                                                                    1. 1

                                                                                      What a bad article. The author seems illinformed on the subject. The very reason to why Bitcoin (core) has failed are not mentioned at all. Here is the deal: Bitcoin is currently not what Bitcoin was when it was created. Slow peer-to-peer transactions and high processing fees. The current blocksize limit of 1MiB or thereabouts is the sole reason for this. The system can’t handle enough transactions… and when that happens the fees rise fast and the while system become boggled and slow. Currently the fees are much lower than they were in December 2017. Why? Because people have moved to other better alternatives and some have completely stopped using any crypto. It as a bad experience and I don’t blame them for having that stance. I think there is a real possibility of a “death spiral of the blockchain”. Fees will increase and it will become impossible to move coins on the blockchain besides the upper 10% of bitcoin holders. For traders on exchanges bitcoin seems fast; because no transactions are taking place. When you actually decide to move your bitcoins to a wallet you own you’ll pay high fees… if not your transaction could take months to clear or never actually clear.

                                                                                      The fork that occurred on 1st August created Bitcoin Cash. This fork is much closer to what the Bitcoin was. Bitcoin Cash is this today. Removal of the segwit code (which hasn’t solved anything), disabling of RBF (replace-by-fee) enabling 0-confirmation transactions again. A new DAA (difficulty adjustment algorithm). Finally increase the block size to 8MiB.

                                                                                      The Bitcoin has been crippled on purpose by Blockstream deep in the pockets of bankers and insurance companies. Blockstream is the main contributor to the Bitcoin development. Look at the sponsors; https://www.blockstream.com/about/#investors

                                                                                      Before the bankers, and their followers, got indirectly involved in Bitcoin development there never was any discussion about limiting the block size to 1MiB; in fact the opposite was discussed. See; https://twitter.com/adam3us/status/636410827969421312?lang=e https://bitcointalk.org/index.php?topic=1314.msg15143#msg151https://np.reddit.com/r/btc/comments/71h884/pieter_wuille_im_in_favor_of_increasing_the_block/

                                                                                      Now all of this has led to a complete divide and clusterfuck of the community. It is an very ugly and toxic environment and is sad to look at. On top of that we now have thousands of alternative coins and blockchains. It’s a mess and it will take time to recover (if ever).

                                                                                      The current version of bitcoin is crippled and completely unusable as a currency as is.

                                                                                      1. 12

                                                                                        Author has literally written a book on the subject.

                                                                                        The linked article doesn’t address all the arguments about Bitcoin (the book takes a stab at it). It addresses one very specific “meme” prevalent in the Bitcoin booster community - that the technology is akin to the early days of the internet and that it will therefore automatically become as world-changing as the internet is.

                                                                                        This is a dumb argument for the reasons listed in the linked article and I will be happy to link to it if I ever have the misfortune to discuss Bitcoin with someone who brings it up.

                                                                                        1. 1

                                                                                          Why do you see it as a misfortune to talk about Bitcoin? The topic is extremely interesting because of its history of events and the technology. That’s at least my take on it.

                                                                                          1. 2

                                                                                            I should have qualified “discussing online, and not here” ;)

                                                                                        2. 11

                                                                                          That comment is literally spam for Bitcoin Cash, with added banker conspiracy theories.

                                                                                          1. 3

                                                                                            The linked article doesn’t address all the arguments about Bitcoin (the book takes a stab at it). It addresses one very specific “meme” prevalent in the Bitcoin booster community - that the technology is akin to the early days of the internet and that it will therefore automatically become as world-changing as the internet is.

                                                                                            Now I feel really bad about my comment. Was not intended as spam for Bitcoin Cash. I just stated what has actually happened. Banks or not someone has purposefully crippled the Bitcoin. This is hard to deny. There are many alternatives to Bitcoin Cash. Cash is just interesting because it has the original blockchain from before it split 1. August and has many active developers split on many different teams. No Ill-natured attempts like other forks (Bitcoin Gold, Bitcoin Diamond to name a few).

                                                                                            Have a nice weekend!

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                                                                                              Banks or not someone has purposefully crippled the Bitcoin.

                                                                                              I don’t agree with this premise. I don’t believe any one entity or entities colluded in crippling Bitcoin. The effects we are observing now (Bitcoin Core under centralized development, Bitcoin Cash under centralized mining) are simply the natural effects of an open source project with purposefully weak governance.

                                                                                              Most open source projects don’t make money directly off their work however. The potential effect on the price of the tokens leads to an even more poisonous atmosphere and debate.

                                                                                              1. 3

                                                                                                simply the natural effects of an open source project with purposefully weak governance.

                                                                                                Yep. Ethereum has at least as many technical crises - but it holds together because the community more or less trusts the dev team to keep pulling rabbits out of the hat. (Ethereum Classic notwithstanding.) And I think they understand that, and know they need some spectacular new achievements in computer science before Ethereum clogs the way Bitcoin did.

                                                                                                1. 1

                                                                                                  Fair enough. We are all entitled to our own opinion. I’d look more carefully into the whole history of events. I’m not sure how involved you are in this matter. I’ve been following Bitcoin development since early 2011 and my view is that something did happen to the original idea that is Bitcoin. Conspiracy or not I’m convinced that foul play has diverted or detailed the project. Look at segwit, lightning and re-enabled RBF… it hasn’t really solved anything; only introduced new overly complicated code. Lightning network is a mess currently and it actually makes it harder to do transactions. You have to be online to receive and send payments. You also have to pay for payments. All of this already works without lightning or segwit. In early stages there was not even a blocksize limit. It was later introduced by Satoshi and his view was that the blocksize should increase with usage. Now Bitcoin Cash has 8MiB blocks and it works (blocks are very small today though, but 8MiB blocks have been mined). Why go so far to re-enable RBF, introduce segwit (essentially just changing what counts as space in blocks) and then introduce a whole new transaction paradigm (lightning network; a old-school mesh-network which we know are not got at scaling). All of this instead of changing a hardcoded blocksize limit. It all makes very little sense to me. Look at Satoshi explaning the limit and how easy it would be to change it if needed; https://bitcointalk.org/index.php?topic=1347.msg15139#msg15139 and https://bitcointalk.org/index.php?topic=1347.msg15366#msg15366. There is a great talk about 1GiB blocks by Peter Rizun and Andrew Stone on why it is feasible to have very large blocks; https://www.youtube.com/watch?v=5SJm2ep3X_M&t=805s

                                                                                                  What is your take on segwit and lightning network?

                                                                                                  1. 2

                                                                                                    Frankly, I lost the plot back when Bitcoin XT was proposed…. that’s when /u/Theymos instituted the infamous “altcoin ban”. After that most of the “discussion” on Reddit has been obscured by namecalling and kvetching about who censors who.

                                                                                                    As to whether the blocksize should be raised… it’s clear that even if the blocksize were raised across the board, the same issue would only occur a few months or years later. The number of transactions in a block is an inherently limited resource. LN and segwit are attempts to address this reality - by treating Bitcoin itself a bit like gold reserves, that are not easily moved, and adding a network on top of it that can handle the day to day transactions but still being 100% covered by the underlying BTC asset reserves.

                                                                                                    Conceptually the idea makes sense, but in practice it’s yet another UI/UX layer on top of a system that’s already fairly user hostile. It’s not clear whether the routing will work, and it seems pretty clear that the end result will be a bunch of “supernodes” that will act a lot like traditional banks, and which will extract fees.

                                                                                                    That said, I don’t see why there couldn’t have been a compromise raise of the blocksize while LN was being worked on (the “New York agreement”). This is where the conspiracy theories come in (segwit required removing the configuration that allowed ASICBOOST, Blockstream was in the hands of Big Fees), and, given the generally very opaque nature of the Bitcoin community it’s inevitable that they appear.

                                                                                                    Edit: wording

                                                                                            2. 3

                                                                                              high processing fees

                                                                                              BTC fees are about $0.04 at the moment. Plus the lightning network is in beta.

                                                                                              1. 1

                                                                                                Yes. I stated why that is and how easy it can increase to a very high fee again.

                                                                                            1. 2

                                                                                              This article is pretty hollow. I mean yeah, Bitcoin failed. There’s no doubt about that. The weird balance of power between the developers/miners is poorly designed and there really is no incentive to use Bitcoin/Ethereum/Monero/etc other than for speculation and buying drugs.

                                                                                              However these are just design flaws, the germ of the idea is out there and I’m sure someone will iron out these edge cases. Personally I think it involves consolidating the developers and miners together so that they are one (probably anonymous) entity. You need to trust the developers already, might as well put that into the design instead of also having to trust randos who can afford massive GPU farms.

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                                                                                                So your solution to achieving a trustless design is … a design with trust in?

                                                                                                What bit of the cryptocurrency promise is left?

                                                                                                1. 1

                                                                                                  I mean, it basically boils down to what kind of political system you think would work best. Bitcoin is clearly anarchist, personally I think a monarchy is the way to go.

                                                                                                  So your solution to achieving a trustless design is … a design with trust in?

                                                                                                  How can we be sure a trustless design is even possible? With what’s available now, you have to trust the developers to ensure the protocol works as advertised, and to distribute software updates. You have to trust the miners to not pull a 51% attack.

                                                                                                  What bit of the cryptocurrency promise is left?

                                                                                                  A frictionless, resilient, (hopefully) non-corruptible financial system.

                                                                                                  1. 1

                                                                                                    personally I think a monarchy is the way to go

                                                                                                    Why do you favor a monarchy?

                                                                                                    1. 1

                                                                                                      I think, with the right ruler, it’s the best you can get.

                                                                                                      1. 1

                                                                                                        That’s what the people I know in Singapore tell me. They tell me all kinds of messed up stuff about their little surveillance/police state. They also tell me the main rulers are smart people that at least want to take care of the people. The younger one is also a bit tech savvy I’m told. About the closest thing to a monarchy or surveillance state I could tolerate. Close to. Call me paranoid. ;)

                                                                                                        1. 2

                                                                                                          That’s interesting, I’ll have to visit Singapore at some point :D

                                                                                                2. 2

                                                                                                  You need to trust the developers already

                                                                                                  no, you can verify their code or write your own alternative client.

                                                                                                  1. 3

                                                                                                    In practice, about 0 users actually do this, and it should be reasonably obvious that this won’t change - particularly for a system aspiring to general adoption. Civilisation runs on division of labour; the universally competent Heinleinian individual is a fictional construct.

                                                                                                    1. 2

                                                                                                      I think at least a few hundred people review each change, perhaps thousands. Then you’re not trusting the developers, you’re trusting that if something were wrong then one of the people who reviewed it would make a fuss about it.

                                                                                                      1. 2

                                                                                                        I presume you’re not familiar with Ethereum Classic, and why it came into being?

                                                                                                        1. 1

                                                                                                          I’m guessing your point is that not all open source code is bug free? I don’t see how that contradicts anything I’ve said.

                                                                                                          1. 3

                                                                                                            Nope, the DAO hack was a bug in the contract, not Ethereum itself.

                                                                                                            My point it’s not just about bugs in the software and verifying that the software does as advertised. The developers are BDFL and are at the sole discretion of how the cryptocoin evolves. The Ethereum devs decided that they wanted their money back and forked the blockchain to reverse this DAO hack. Lots of users protested, to the point of creating an entirely different cryptocoin with the original blockchain in-tact, but it clearly failed, look at their prices. Most people just don’t care.

                                                                                                            1. 2

                                                                                                              Exactly. So much for immutable, decentralized, and trustless.

                                                                                                              1. 1

                                                                                                                It’s not like the Ethereum project can do whatever they want. They were able to do that fork because enough people thought it was reasonable. Any changes they want to make are at the mercy of public opinion.

                                                                                                                1. 3

                                                                                                                  Sure, what they can do is limited. But as we have seen, they have enough power to do some pretty nepotistic stuff, with little protest.

                                                                                                                  enough people thought it was reasonable

                                                                                                                  I don’t think so, most people just weren’t aware of what was going on or didn’t care. There have been other hacks since the DAO, with lots of money at stake, that didn’t see a fork.

                                                                                                                  1. 1

                                                                                                                    My contrast, your idea of consolidating miners and developers seems that they could do whatever they want. Unless I’ve misunderstood your proposal.

                                                                                                                    1. 2

                                                                                                                      Yep, that’s exactly what I’m saying. I don’t think centralization isn’t inherently bad, as long as the people in charge have good intentions.

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                                                                                                                        have you thought through how to select people who have good intentions, and how to ensure that they aren’t corrupted or replaced by people with bad intentions?

                                                                                                                        1. 1

                                                                                                                          I’ve thought about it but haven’t really figured anything out yet. The other thing you have to consider is competence, they can be well-intentioned but if they don’t know how to lead then things could go bad as well.

                                                                                                                          As far as specific people go I thought about Scott Forstall and Smealum, but I’m not 100% sure they would check both boxes. There’s always a risk, I guess.

                                                                                                    2. -2

                                                                                                      So much ignorance in one post… It’s hard to know where to begin.

                                                                                                      Bitcoin has a market cap of $117 billion. N64N64, if that’s your idea of “failed” you have great aspirations indeed!

                                                                                                      “there really is no incentive to use Bitcoin/Ethereum/Monero/etc other than for speculation and buying drugs” - Bitcoin was originally designed by Satoshi Nakamoto as a response to the bank failures of 2008. He wanted to disintermediate online transactions, removing banks from the equation altogether. Today thousands of online merchants accept Bitcoin or Bitcoin Cash, and it’s growing. International remittance is the really big application for cryptocurrencies right now though with millions of dollars being transferred internationally every day. Banks aren’t a party to these transactions so to that extent Satoshi’s vision has succeeded.

                                                                                                      “buying drugs” - Bitcoin is uniquely poorly suited to confidential transactions given its public ledger. These days the NSA routines tracks all Bitcoin transactions so only the most foolish would use it for illegal purposes.

                                                                                                    1. 3

                                                                                                      I like @David_Gerard, I follow him on twitter and it’s refreshing to see a voice of sanity on the crypto twitters. You might not always agree with everything he has to say, but in a land of unlimited shilling for the shittiest of shitcoins, his book is a breath of fresh air.

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                                                                                                        I would say the majority of crypto advocates are fine actually - and the discussion is not nearly as much pro/anti as it is delusional versus not-delusional. But the raving nutters are very loud indeed. Main difference I find between me and the non-delusional advocates is that they’re more optimistic for the future of this stuff.

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                                                                                                        As usual, David apparently fails or refuses to understand how and why PoW is useful and must attack it at every opportunity (using his favorite rhetorical technique of linking negatively connoted phrases to vaguely relevant websites).

                                                                                                        That said, the article reminds me of a fun story - I went to a talk from a blockchain lead at <big bank> a while back and she related that a primary component of her job was assuring executives that, in fact, they did not need a blockchain for <random task>. This had become such a regular occurrence that she had attached this image to her desk.

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                                                                                                          What would you consider a useful situation for PoW? In the sense that no other alternative could make up for the advantages in some real life use-case?

                                                                                                          But otherwise, and maybe it’s just me, since I agree wuth his premise, but I see @David_Gerard as taking the opposite role of popular blockchain (over-)advocates, who claim that the technology is the holy grail for far too many problems. Even if one doesn’t agree with his conclusions, I enjoy reading his articles, and find them very informative, since he doesn’t just oppose blockchains from a opinion-based position, but he also seems to have the credentials to do so.

                                                                                                          1. 1

                                                                                                            Relying to @gerikson as well. I personally believe that decentralization and cryptographically anchored trust are extremely important (what David dismissively refers to as “conspiracy theory economics”). We know of two ways to achieve this: proof of work, and proof of stake. Proof of stake is interesting but has some issues and trade-offs. If you don’t believe that PoW mining is some sort of anti-environmental evil (I don’t) it seems to generally offer better properties than PoS (like superior surprise-fork resistance).

                                                                                                            1. 13

                                                                                                              I personally believe that decentralization and cryptographically anchored trust are extremely important

                                                                                                              I personally also prefer decentralised or federalised systems, when they have a practical advantage over a centralized alternative. But I don’t see this to be the case with most application of the blockchain. Bitcoin, as a prime example, to my knowledge is too slow, too inconvenient, too unstable and too resource hungry to have a practical application, as a real substitute for money, either digital or virtual. One doesn’t have the time to wait 20m or more whenever one pays for lunch or buys some chewing gum at a corner shop, just because some other transactions got picked up first by a miner. It’s obviously different when you want to do something like micro-donations or buying illegal stuff, but I just claim that this isn’t the basis of a modern economy.

                                                                                                              Cryptography is a substitute for authority, that is true, but I don’t belive that this is always wanted. Payments can’t be easily reveresed, addresses mean nothing, clients might loose support because the core developers arbitrarily change stuff. (I for example am stuck with 0.49mBTC from an old Electrum client, and I can’t do anything with it, since the whole system is a mess, but that’s rather unrelated.) This isn’t really the dynamic basis which capitalism has managed to survive on for this long. But even disregarding all of this, it simply is true that bitcoin isn’t a proper decentralized network like BitTorrent. Since the role of the wallet and the miner is (understandably) split, these two parts of the network don’t scale equally. In China gigantic mining farms are set up using specialized hardware to mine, mine, mine. I remember reading that there was one farm that predominated over at least 10% of the total mining power. All of this seems to run contrary to the proclaimed ideals. Proof of Work, well “works” in the most abstract sense, that it produces the intended results on one side, at the cost of disregarding everything can be disregarded, irrespective of whether it should be or not. And ultimately I prioritise other things over an anti-authority fetish, as do most people -which reminds us that even if everything I said is false that Bitcoin just doesn’t have the adoption to be significant enough to anyone but Crypto-Hobbiests, Looney Libertarians and some soon-to-fail startups in Silicon Valley.

                                                                                                              1. 5

                                                                                                                there was one farm that predominated over at least 10% of the total mining power

                                                                                                                There was one pool that was at 42% of the total mining power! such decentralization very security

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                                                                                                                    To be fair, that was one pool consisting of multiple miners. What I was talking about was a single miner controlling 10% of the total hashing power.

                                                                                                                    1. 7

                                                                                                                      That’s definitely true.

                                                                                                                      On the other hand, if you look at incident reports like https://github.com/bitcoin/bips/blob/master/bip-0050.mediawiki — the pool policies set by the operators (often a single person has this power for a given pool) directly and significantly affect the consensus.

                                                                                                                      Ghash.io itself did have incentives to avoid giving reasons for accusations that would tank Bitcoin, but being close to 50% makes a pool a very attractive attack target: take over their transaction and parent-block choice, and you take over the entire network.

                                                                                                                  2. 0

                                                                                                                    But I don’t see this to be the case with most application of the blockchain.

                                                                                                                    Then I would advise researching it.

                                                                                                                    One doesn’t have the time to wait 20m or more whenever one pays for lunch or buys some chewing gum at a corner shop

                                                                                                                    Not trying to be rude, but it’s clear whenever anyone makes this argument that they don’t know at all how our existing financial infrastructure works. In fact, it takes months for a credit card transaction to clear to anything resembling the permanence of a mined bitcoin transaction. Same story with credit cards.

                                                                                                                    Low-risk merchants (digital goods, face-to-face sales, etc.) rarely require the average 10 minute (not sure where you got 20 from) wait for a confirmation.

                                                                                                                    If you do want permanence, Bitcoin is infinitely superior to any popular payment mechanism. Look into the payment limits set by high-value fungible goods dealers (like gold warehouses) for bitcoin vs. credit card or check.

                                                                                                                    Bitcoin just doesn’t have the adoption to be significant enough to anyone but Crypto-Hobbiests, Looney Libertarians and some soon-to-fail startups in Silicon Valley.

                                                                                                                    Very interesting theory - do you think these strawmen you’ve put up have collective hundreds of billions of dollars? As an effort barometer, are you familiar with the CBOE?

                                                                                                                    1. 10

                                                                                                                      Please try to keep a civil tone here.

                                                                                                                      Also, it’s hard to buy a cup of coffee or a steam game or a pizza with bitcoin. Ditto stocks.

                                                                                                                      1. -4

                                                                                                                        It’s hard to be nice when the quality of discourse on this topic is, for some reason, abysimally low compared to most technical topics on this site. It feels like people aren’t putting in any effort at all.

                                                                                                                        For example, why did you respond with this list of complete non-sequiturs? It has nothing to do with what we’ve been discussing in this thread except insofar as it involves bitcoin. I feel like your comments are normally high-effort, so what’s going on? Does this topic sap people’s will to think carefully?

                                                                                                                        (Civility is also reciprocal, and I’ve seen a lot of childish name-calling from the people I’m arguing with in this thread, including the linked article and the GP.)

                                                                                                                        Beyond the fact that this list is not really relevant, it’s also not true; you could have just searched “bitcoin <any of those things>” and seen that you can buy any of those things pretty easily, perhaps with a layer of indirection (just as you need a layer of indirection to buy things in the US if you already have EUR). In that list you gave, perhaps the most interesting example in bitcoin’s disfavor is Steam; Steam stopped accepting bitcoin directly recently, presumably due to low interest. However, it’s still easy to buy games from other sources (like Humble) with BTC.

                                                                                                                        1. 6

                                                                                                                          IMO, your comments are not very inspiring for quality. As someone who does not follow Bitcoin or the Blockchain all that much, I have not felt like any of your comments addressed anyone else’s comments. Instead, I have perceived you as coming off as defensive and with the attitude of “if you don’t get it you haven’t done enough research because I’m right” rather than trying to extol the virtues of the blockchain. Maybe you aren’t interested in correcting any of what you perceive as misinformation on here, and if so that’s even worse.

                                                                                                                          For example, I do not know of any place I can buy pizza with bitcoin. But you say it is possible, but perhaps with a layer of indirection. I have no idea what this layer of indirection is and you have left it vague, which does not lend me to trusting your response.

                                                                                                                          In one comment you are very dismissive of people’s Bitcoins getting hacked, but as a lay person, I see news stories on this all the time with substantial losses and no FDIC, so someone like me considers this a major issue but you gloss over it.

                                                                                                                          Many of the comments I’ve read by you on this thread are a similar level of unhelpful, all the while claiming the person you’re responding to is some combination of lazy or acting dumb. Maybe that is the truth but, again, as an outsider, all I see is the person defending the idea coming off as kind of a jerk. Maybe for someone more educated on the matter you are spot on.

                                                                                                                          1. 5

                                                                                                                            There is a religious quality to belief in the blockchain, particularly Bitcoin. It needs to be perfect in order to meet expectations for it: it can’t be “just” a distributed database, it has to be better than that. Bitcoin can’t be “just” a payment system, it has to be “the future of currency.” Check out David’s book if you’re interested in more detail.

                                                                                                                      2. 8

                                                                                                                        In fact, it takes months for a credit card transaction to clear to anything resembling the permanence of a mined bitcoin transaction. Same story with credit cards.

                                                                                                                        But I don’t have to wait months for both parties to be content the transaction is successful, only seconds, so this is really irrelevant to the point you are responding to, which is that if a Bitcoin transaction takes 10m to process then I heave to wait 10m for my transaction to be done, which people might not want to do.

                                                                                                                        1. -1

                                                                                                                          Again, as I said directly below the text you quoted, most merchants don’t require you to wait 10 minutes - only seconds.

                                                                                                                        2. 5

                                                                                                                          Then I would advise researching it.

                                                                                                                          It is exactly because I looked into the inner workings of Bitcoin and the Blockchain - as a proponent I have to mention - that I became more and more skeptical about it. And I still do support various decentralized and federated systems: BitTorrent, IPFS, (proper) HTTP, Email, … but just because the structure offers the possibility for a decentralized network, doesn’t have to mean that this potential is realized or that it is necessarily superior.

                                                                                                                          Not trying to be rude, but it’s clear whenever anyone makes this argument that they don’t know at all how our existing financial infrastructure works. In fact, it takes months for a credit card transaction to clear to anything resembling the permanence of a mined bitcoin transaction. Same story with credit cards.

                                                                                                                          The crucial difference being that, let’s say the cashier nearly instantaneously hears a some beep and knows that it isn’t his responsibility, nor that of the shop, to make sure that the money is transfered. The Bank, the credit card company or whoever has signed a binding contract lining this technical part of the process out to be what they have to care about, and if they don’t, they can be sued since there is an absolute regulatory instance - the state - in the background. This mutual delegation of trust, gives everyone a sense of security (regardless of how true or false it is) that makes people spend money instead of hording it, investing into projects instead of trading it for more secure assets. Add Bitcoins aforementioned volatileness, and no reasonable person would want to use it as their primary financial medium.

                                                                                                                          If you do want permanence, Bitcoin is infinitely superior to any popular payment mechanism.

                                                                                                                          I wouldn’t conciser 3.3 to 7 transactions per second infinitely superior to, for example Visa with an average of 1,700 t/s. Even it you think about it, there are far more that just 7 purchases being made a second around the whole world for this to be realistically feasible. But on the other side, as @friendlysock Bitcoin makes up for it by not having too many things you can actually buy with it: The region I live in has approximately a million or something inhabitants, but according to CoinMap even by the most generous measures, only 5 shops (withing a 30km radius) accepting it as a payment method. And most of those just offer it to promote themselves anyway.

                                                                                                                          Very interesting theory - do you think these strawmen you’ve put up have collective hundreds of billions of dollars? As an effort barometer, are you familiar with the CBOE?

                                                                                                                          (I prefer to think about my phrasing as a exaggeration and a handful of other literary deviced, instead of a fallacy, but never mind that) I’ll give you this: It has been a while since I’ve properly engaged with Bitcoin, and I was always more interested in the technological than the economical side, since I have a bit of an aversion towards libertarian politics. And it might be true that money is invested, but that still doesn’t change anything about all the other issues. It remains a bubble, a volatile, unstable, unpredictable bubble, and as it is typical for bubbles, people invest disproportional sums into it - which in the end makes it a bubble.

                                                                                                                          1. 0

                                                                                                                            The crucial difference being that, let’s say the cashier nearly instantaneously hears a some beep and knows that it isn’t his responsibility, nor that of the shop, to make sure that the money is transfered.

                                                                                                                            Not quite. The shop doesn’t actually have the money. The customer can revoke that payment at any time in the next 90 or 180 days, depending. Credit card fraud (including fraudulent chargebacks) is a huge problem for businesses, especially online businesses. There are lots of good technical articles online about combatting this with machine learning which should give you an idea of the scope of the problem.

                                                                                                                            makes people spend money instead of hording it,

                                                                                                                            Basically any argument of this form (including arguments for inflation) don’t really make sense with the existence of arbitrage.

                                                                                                                            Add Bitcoins aforementioned volatileness, and no reasonable person would want to use it as their primary financial medium.

                                                                                                                            So it sounds like it would make people… spend money instead of hoarding it, which you were just arguing for?

                                                                                                                            I wouldn’t conciser 3.3 to 7 transactions per second infinitely superior to, for example Visa with an average of 1,700 t/s.

                                                                                                                            https://lightning.network

                                                                                                                            as @friendlysock Bitcoin makes up for it by not having too many things you can actually buy with it

                                                                                                                            This is just patently wrong. The number of web stores that take Bitcoin directly is substantial (both in number and traffic volume), and even the number of physical stores (at least in the US) is impressive given that it’s going up against a national currency. How many stores in the US take even EUR directly?

                                                                                                                            Anything you can’t buy directly you can buy with some small indirection, like a BTC-USD forex card.

                                                                                                                            It remains a bubble, a volatile, unstable, unpredictable bubble

                                                                                                                            It’s certainly volatile, and it’s certainly unstable, but it may or may not be a bubble depending on your model for what Bitcoin’s role in global finance is going to become.

                                                                                                                            1. 5

                                                                                                                              Not quite. The shop doesn’t actually have the money. The customer can revoke that payment at any time in the next 90 or 180 days, depending

                                                                                                                              You’ve still missed my point - it isn’t important if the money has been actually transfered, but that there is trust that a framework behind all of this will guarantee that the money will be there when it has to be, as well as a protocol specifying what has to be done if the payment is to be revoked, if a purchase wishes to be undone, etc.

                                                                                                                              Credit card fraud (including fraudulent chargebacks) is a huge problem for businesses, especially online businesses.

                                                                                                                              Part of the reason, I would suspect is that the Internet was never made to be a platform for online businesses - but I’m not going to deny the problem, I’m certainly not a defender of banks and credit card companies - just an opponent of Bitcoin.

                                                                                                                              Basically any argument of this form (including arguments for inflation) don’t really make sense with the existence of arbitrage.

                                                                                                                              Could you elaborate? You have missed my point a few times already, so I’d rather we understand each other instead of having two monologues.

                                                                                                                              So it sounds like it would make people… spend money instead of hoarding it, which you were just arguing for?

                                                                                                                              No, if it’s volatile people either won’t buy into it in the first place. And if a currency is unstable, like Bitcoin inflating and deflating all the time, people don’t even know what do do with it, if it were their main asset (which I was I understand you are promoting, but nobody does). I doubt it will ever happen, since if prices were insecure, the whole economy would suffer, because all the “usual” incentives would be distorted.

                                                                                                                              https://lightning.network

                                                                                                                              I haven’t heard of this until you mentioned it, but it seems like it’s quite new, so time has to test this yet-another-bitcoin-related project that has popped up. Even disregarding that it will again need to first to make a name of it self, then be accepted, then adopted, etc. from what I gather, it’s not the ultimate solution (but, I might be wrong), especially since it seems to encourage centralization, which I believe is what you are so afraid of.

                                                                                                                              This is just patently wrong. The number of web stores that take Bitcoin directly is substantial (both in number and traffic volume),

                                                                                                                              Sure, there might be a great quantity of shops (as I mentioned, who use Bitcoin as a medium to promote themselves), but I, and from what I know most people, don’t really care about these small, frankly often dodgy online shops. Can I use it to pay directly on Amazon? Ebay? Sure, you can convert it back and forth, but all that means it that Bitcoin and other crypto currencies are just an extra step for life stylists and hipster, with no added benefit. And these shops don’t even accept Bitcoin directly, to my knowledge always just so they can convert it into their national currency - i.e. the one they actually use and Bitcoins value is always compared to. What is even Bitcoin without the USD, the currency it hates but can’t stop comparing itself to?

                                                                                                                              and even the number of physical stores (at least in the US) is impressive given that it’s going up against a national currency.

                                                                                                                              The same problems apply as I’ve already mentioned, but I wonder: have you actually ever used Bitcoin to pay in a shop? I’ve done it once and it was a hassle - in the end I just bought it with regular money like a normal person because it was frankly too embarrassing to have the cashier have to find the right QR code, me to take out my phone, wait for me got get an internet connection, try and scan the code, wait, wait, wait…. And that is of course only if you want to make the trip to buy for the sake of spending money, and decide to make a trip to some place you’d usually never go to buy something you don’t even need.

                                                                                                                              Ok when you’re buying drugs online or doing something with microdonations, but otherwise… meh.

                                                                                                                              How many stores in the US take even EUR directly?

                                                                                                                              Why should they? And even if they do, they convert it back to US dollars, because that’s the common currency - there isn’t really a point in a currency (one could even question if it is one), when nobody you economically interact with uses it.

                                                                                                                              Anything you can’t buy directly you can buy with some small indirection, like a BTC-USD forex card.

                                                                                                                              So a round-about payment over a centralized instance - this is the future? Seriously, this dishonesty of Bitcoin advocates (and Libertarians in general) is why you guys are so unpopular. I am deeply disgusted that I have ever advocated for this mess.

                                                                                                                              It’s certainly volatile, and it’s certainly unstable, but it may or may not be a bubble depending on your model for what Bitcoin’s role in global finance is going to become.

                                                                                                                              So you admit that is has none of the necessary preconditions to be a currency… but for some reason it will… do what exactly? If you respond to anything I mentioned here, at least tell me this: What is your “model” for what Bitcoin’s role is going to be?

                                                                                                                      3. 14

                                                                                                                        Why don’t you believe it is anti-enviromental? It certainly seems to be pretty power hungry. In fact it’s hunger for power is part of why it’s effective. All of the same arguments about using less power should apply.

                                                                                                                        1. -1

                                                                                                                          Trying to reduce energy consumption is counterproductive. Energy abundance is one of the primary driving forces of civilizational advancement. Much better is to generate more, cleaner energy. Expending a few terrawatts on substantially improved economic infrastructure is a perfectly reasonable trade-off.

                                                                                                                          Blaming bitcoin for consuming energy is like blaming almond farmers for using water. If their use of a resource is a problem, you should either get more of it or fix your economic system so externalities are priced in. Rationing is not an effective solution.

                                                                                                                          1. 10

                                                                                                                            on substantially improved economic infrastructure

                                                                                                                            This claim definitely needs substantiation, given that in practice bitcoin does everything worse than the alternatives.

                                                                                                                            1. -1

                                                                                                                              bitcoin does everything worse than the alternatives.

                                                                                                                              Come on David, we’ve been over this before and discovered that you just have a crazy definition of “better” explicitly selected to rule out cryptocurrencies.

                                                                                                                              Here’s a way Bitcoin is better than any of its traditional digital alternatives; bitcoin transactions can’t be busted. As you’ve stated before, you think going back on transactions at the whim of network operators is a good thing, and as I stated before I think that’s silly. This is getting tiring.

                                                                                                                              A few more, for which you no doubt have some other excuse for why this is actually a bad thing; Bitcoin can’t be taken without the user’s permission (let me guess; “but people get hacked sometimes”, right?). Bitcoin doesn’t impose an inflationary loss on its users (“but what will the fed do?!”). Bitcoin isn’t vulnerable to economic censorship (don’t know if we’ve argued about this one; I’m guessing you’re going to claim that capital controls are critical for national security or something.). The list goes on, but I’m pretty sure we’ve gone over most of it before.

                                                                                                                              I’ll admit that bitcoin isn’t a panacea, but “it does everything worse” is clearly a silly nonsensical claim.

                                                                                                                            2. 4

                                                                                                                              Reducing total energy consumption may or may not be counterproductive. But almost every industry I can name has a vested interest in being more power efficient for it’s particular usage of energy. The purpose of a car isn’t to burn gasoline it is to get people places. If it can do that with less gasoline people are generally happier with it.

                                                                                                                              PoW however tries to maximizes power consumption, via second order effects , with the goal of making it expensive to try to subvert the chain. It’s clever because it leverages economics to keep it in everyone’s best interest to not fork but it’s not the same as something like a car where reducing energy consumption is part of the value add.

                                                                                                                              I think that this makes PoW significantly different than just about any other use of energy that I can think of.

                                                                                                                              1. 3

                                                                                                                                Indeed. The underlying idea of Bitcoin is to simulate the mining of gold (or any other finite, valuable resource). By ensuring that an asset is always difficult to procure (a block reward every 10 minutes, block reward halving every 4 years), there’s a guard against some entity devaluing the currency (literally by fiat).

                                                                                                                                This means of course that no matter how fast or efficient the hardware used to process transactions becomes, the difficulty will always rise to compensate for it. The energy per hash calculation has fallen precipitously, but the number of hash calculations required to find a block has risen to compensate.

                                                                                                                          2. 6

                                                                                                                            We’ve been doing each a long time without proof of work. There’s lots of systems that are decentralized with parties that have to look out for each other a bit. The banking system is an example. They have protocols and lawyers to take care of most problems. Things work fine most of the time. There are also cryptographically-anchored trust systems like trusted timestamping and CA’s who do what they’re set up to do within their incentives. If we can do both in isolation without PoW, we can probably do both together without PoW using some combination of what’s already worked.

                                                                                                                            I also think we haven’t even begun to explore the possibilities of building more trustworthy charters, organizational incentives, contracts, and so on. The failings people speak of with centralized organizations are almost always about for-profit companies or strong-arming governments whose structure, incentives, and culture is prone to causing problems like that. So, maybe we eliminate root cause instead of tools root cause uses to bring problems since they’ll probably just bring new forms of problems. Regulations, disruption, or bans of decentralized payment is what I predicted would be response with some reactions already happening. They just got quite lucky that big banks like Bank of America got interested in subverting it through the legal and financial system for their own gains. Those heavyweights are probably all that held the government dogs back. Ironically, the same ones that killed Wikileaks by cutting off its payments.

                                                                                                                        2. 8

                                                                                                                          In what context do you view proof-of-work as useful?

                                                                                                                          1. 11

                                                                                                                            You have addressed 0 of the actual content of the article.

                                                                                                                          1. 4

                                                                                                                            Last month, I had to install a package manager to install a package manager.

                                                                                                                            owwww