Blockchain technology goes far beyond "currency" replacement. Most of the new ICO's are using it for varied applications that benefit from its distributed and verifying nature.
I appreciate this article for its smart and cordial criticism, but as I've pointed out before, the decentralization of currency enables the separation of state from wealth, which will, for example, allow people in Venezuela or India to exit their national currency and take control back from their oppressive leaders. The world is already moving to digital cash (see India). The question is whether we want this digital cash to be completely controlled by a central bank or and oppressive leader and traceable by the government, or whether we want this digital cash to be global and decentralized, shared by people of all states.
If a person becomes a refugee, they can memorize their brain wallet and cross the border, keeping their digital gold and wealth intact. This is an example of a problem a centralized database cannot solve.
I believe the author was specifically referring to non-currency applications of the blockchain.
Its hard to disagree with your comment as the bitcoin blockchain experiment seems to be going well so far.
They trade it person-to-person. Sure, it's hard and maybe risky, but it's also risky to keep your wealth in Bolivars when inflation is double or triple-digit percentages.
"Some use bitcoins to buy Amazon gift cards, then order goods and food on the online store in the US and other countries, which can then be delivered by courier to Venezuela – where supermarket shelves are frequently empty."[1]
The largest beneficiaries of a currency that cannot be regulated by governments are the people those regulations currently affected by those regulations..
The average citizen in Venezuela or India generally doesn't have enough money to have to worry about financial regulations. Even if they wanted to take advantage of a blockchain currency, ss justinfrankel suggested, is will be hard for the average person in (e.g.) Venezuela to participate. If refugees had enough cash to make blockchain storage worthwhile, they wouldn't be refugees. Refugees have immediate security and survivability problems, not financial problems.
On the other hand, a global currency that cannot be regulated by any government is perfect for moving large amounts of capital to avoid taxes and the limiters, safeguards, and other regulations that try to keep modern markets from catastrophic failure. I cannot think of a more efficient way to destroy modern democracies than taking away one of the only tools governments have to affect the other place power has been concentrating: large businesses.
Incidentally, unifying money across countries that have independent economies and monetary policies creates an imbalance that can ruin the participating economies. We've already seen this happen in the eurozone[1][2].
> take control back from their oppressive leaders
That fight is political, not financial. You're talking about a Hollywood plot, not the actual daily reality[3] of people living through that kind of conflict.
> The world is already moving to digital cash
It's very important to have traditional physical cash, because it's the only way to engage in transactions that cannot be controlled or traced[4]. Moving to digital currencies is handing power power to yet more middlemen trying to extract profit and accumulate power.
> is whether we want this digital cash to be [...] traceable by the government,
Blockchains are a pubic ledger, and will always be traceable by definition.
> This is an example of a problem a centralized database cannot solve.
A decentralized database cannot solve it either, because it's a political and social problem, not a database or financial problem.
[4] serial numbers are a problem given the power of modern technology. Actually being untraceable requires careful, regular mixing with a different parties.
First, I never said 'financial regulations.' Of course it's hard for the average person to buy cryptocurrencies, but it will become easier, and that doesn't mean there isn't a small subset of people that are currently going through the difficulty to acquire coins in dire situations, as the article I posted below shows. And it's absurd to suggest that current or past refugees are refugees because they're too poor to have savings. And whatever you think about them, it's easy to imagine future refugees could have savings, under the mattress or in a bank, that would be more transferable via cryptocurrencies which just requires memorizing a pre-private-key passphrase.
Secondly, the Euro/Eurozone is not a great comparison, because it is the antithesis of decentralization, predictability, and majority control. No Central Bank controls the interest rate of Bitcoin.
Next, currency is a means by which rules seek to control citizens, even in poorer countries. How can you dispute this? Whatever you think about the importance of physical cash, governments, like India, are already moving to limit its use, as I said, and some may go completely cashless.
Yes, Bitcoin is a public ledger of transactions, but the owner of an account is unknown from the ledger (i.e. public keys are not inherently tied to identity). When buying bitcoin peer-to-peer, which is what people in Venezuela are doing, there is no way to connect identity to a public key. Other cryptocurrencies (e.g., Monero) have made transactions themselves private via ring signatures (effectively, a set of private keys form a mathematical ring in such a way that a signature cannot from one of them cannot be distinguished) or other techniques. There's an enormous amount of innovation in applied cryptography because of cryptocurrencies and you should make an effort to google something before you claim that it cannot be solved via blockchains.
Finally, Bitcoin is more than just a technology in the same way the internet is more than just a network. It is a social and economic system, so it does solve more than just 'financial' problems.
"Some use bitcoins to buy Amazon gift cards, then order goods and food on the online store in the US and other countries, which can then be delivered by courier to Venezuela – where supermarket shelves are frequently empty."
...
"Farias says that many Venezuelan tech workers who freelance for companies elsewhere prefer to be paid in bitcoin. “With Cryptobuyer, we convert bitcoins into bolivars and help Venezuelans pay for daily life necessities, such as mobile phones recharges, television, water and electricity bills as well as banks transfers in bolivars,” he said."
...
"“Treating my mother’s cancer would have been very difficult without using bitcoins because my business is going bankrupt and I have a lot of debts, so bitcoins enabled me to stay afloat while our currency is collapsing,” said Eli."
I think this is a tonic in contrast to the current hype, if a bit over-bitter. The larger problem that blockchain addresses, though, is, as quantdev alludes, is a way for actors outside of a firm to collaborate at scales previously only available to governments and (for some value of large) large firms.
In the parking car example, for instance, it is true that implementing a system to do that requires only RFID and servers. This means that at one time it was only plausible for Interstate System to use them, with the technology cheapening to the point that parking garage operators install them. Blockchain steps this down the next level allowing everyone using the system to also own the system.
The word "blockchain" can be used anarthrously [1] (without an article) as this piece does, or with an article. I find that those who don't use the article are marketing types and are less technical. Those who use an article ("the Ethereum blockchain") are typically technical, and are referring to a specific blockchain. These 'arthrous' techies are less likely to be either overboard with positive or overboard with negative comments about blockchain technology. They recognize the technical flaws in particular blockchains and the tech in general.
tldr; my inclination was to disregard Korman's post as soon as I saw "Blockchain" without an article.
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[ 5.2 ms ] story [ 42.2 ms ] threadAlso, did Darknet Markets exist before Bitcoin? no. Bitcoin has helped grow alternative markets that never even existed before.
Bitcoin is possibly not solving any problems that you have, but surely it is solving it for others. Why else would it be worth $2,000+ ?
You are looking at Bitcoin and blockchain technology from your view, but are failing to realize all the use cases that may not be of interest to you.
If a person becomes a refugee, they can memorize their brain wallet and cross the border, keeping their digital gold and wealth intact. This is an example of a problem a centralized database cannot solve.
(these ideas originate from Andreas Antonopoulos)
They trade it person-to-person. Sure, it's hard and maybe risky, but it's also risky to keep your wealth in Bolivars when inflation is double or triple-digit percentages.
"Some use bitcoins to buy Amazon gift cards, then order goods and food on the online store in the US and other countries, which can then be delivered by courier to Venezuela – where supermarket shelves are frequently empty."[1]
[1]https://www.theguardian.com/technology/2016/dec/16/venezuela...
The largest beneficiaries of a currency that cannot be regulated by governments are the people those regulations currently affected by those regulations..
The average citizen in Venezuela or India generally doesn't have enough money to have to worry about financial regulations. Even if they wanted to take advantage of a blockchain currency, ss justinfrankel suggested, is will be hard for the average person in (e.g.) Venezuela to participate. If refugees had enough cash to make blockchain storage worthwhile, they wouldn't be refugees. Refugees have immediate security and survivability problems, not financial problems.
On the other hand, a global currency that cannot be regulated by any government is perfect for moving large amounts of capital to avoid taxes and the limiters, safeguards, and other regulations that try to keep modern markets from catastrophic failure. I cannot think of a more efficient way to destroy modern democracies than taking away one of the only tools governments have to affect the other place power has been concentrating: large businesses.
Incidentally, unifying money across countries that have independent economies and monetary policies creates an imbalance that can ruin the participating economies. We've already seen this happen in the eurozone[1][2].
> take control back from their oppressive leaders
That fight is political, not financial. You're talking about a Hollywood plot, not the actual daily reality[3] of people living through that kind of conflict.
> The world is already moving to digital cash
It's very important to have traditional physical cash, because it's the only way to engage in transactions that cannot be controlled or traced[4]. Moving to digital currencies is handing power power to yet more middlemen trying to extract profit and accumulate power.
> is whether we want this digital cash to be [...] traceable by the government,
Blockchains are a pubic ledger, and will always be traceable by definition.
> This is an example of a problem a centralized database cannot solve.
A decentralized database cannot solve it either, because it's a political and social problem, not a database or financial problem.
[1] https://www.youtube.com/watch?v=B6vV8_uQmxs#t=778
[2] https://www.youtube.com/watch?v=9fP6YSCpm8g
[3] https://www.youtube.com/watch?v=kmvAdRntWH8
[4] serial numbers are a problem given the power of modern technology. Actually being untraceable requires careful, regular mixing with a different parties.
Secondly, the Euro/Eurozone is not a great comparison, because it is the antithesis of decentralization, predictability, and majority control. No Central Bank controls the interest rate of Bitcoin.
Next, currency is a means by which rules seek to control citizens, even in poorer countries. How can you dispute this? Whatever you think about the importance of physical cash, governments, like India, are already moving to limit its use, as I said, and some may go completely cashless.
Yes, Bitcoin is a public ledger of transactions, but the owner of an account is unknown from the ledger (i.e. public keys are not inherently tied to identity). When buying bitcoin peer-to-peer, which is what people in Venezuela are doing, there is no way to connect identity to a public key. Other cryptocurrencies (e.g., Monero) have made transactions themselves private via ring signatures (effectively, a set of private keys form a mathematical ring in such a way that a signature cannot from one of them cannot be distinguished) or other techniques. There's an enormous amount of innovation in applied cryptography because of cryptocurrencies and you should make an effort to google something before you claim that it cannot be solved via blockchains.
Finally, Bitcoin is more than just a technology in the same way the internet is more than just a network. It is a social and economic system, so it does solve more than just 'financial' problems.
https://www.theguardian.com/technology/2016/dec/16/venezuela...
"Some use bitcoins to buy Amazon gift cards, then order goods and food on the online store in the US and other countries, which can then be delivered by courier to Venezuela – where supermarket shelves are frequently empty." ...
"Farias says that many Venezuelan tech workers who freelance for companies elsewhere prefer to be paid in bitcoin. “With Cryptobuyer, we convert bitcoins into bolivars and help Venezuelans pay for daily life necessities, such as mobile phones recharges, television, water and electricity bills as well as banks transfers in bolivars,” he said." ...
"“Treating my mother’s cancer would have been very difficult without using bitcoins because my business is going bankrupt and I have a lot of debts, so bitcoins enabled me to stay afloat while our currency is collapsing,” said Eli."
In the parking car example, for instance, it is true that implementing a system to do that requires only RFID and servers. This means that at one time it was only plausible for Interstate System to use them, with the technology cheapening to the point that parking garage operators install them. Blockchain steps this down the next level allowing everyone using the system to also own the system.
tldr; my inclination was to disregard Korman's post as soon as I saw "Blockchain" without an article.
[1] http://www.thefreedictionary.com/anarthrous
It already has for some or competes with others. If you pretend its not so you are probably just another (paid) troll.