Anyways, the definition of "reactionary" is to hold onto an outdated believe or assumption. Crypto means cryptocurrencies these days. I was just stating the obvious.
The context is that the economist wrote a piece on "most powerful people in crypto", so isn't it a bit weird that people assume these people to be cryptographers? Economist, crypto?
Yeah you're right, that was the original context, but then in this thread people also changed the context and were talking about the word crypto in general. It's not super controversial, and as was mentioned somewhere above no one really gets confused when we're talking about cryptography or when we're talking about cryptocurrency - or for that matter when we're talking about the golang crypto package.
So, let me just say, I'm not trying to weirdly argue with by saying you're right, and still the word can be overloaded. Idk language is weird.
Haha in 20 years maybe crypto will be abject failure and it'll become synonymous with pumping and dumping, like "pyramid" scheme, or maybe it'll be a huge success the likes of which no one has ever seen and will be used in that way in certain contexts.
Reactionary is a political label first and foremost and using it in this context tries to equate not-cryptocurrency-advocates to political reactionaries at large. Also, you've contributed to various cryptocurrency repositories, so trying to claim you're not some kind of cryptocurrency advocate/shill/memer or invested in it (pick whichever you like best) might take some convincing.
You put a large emphasis on the idea that I have invested in cryptocurrencies and that I'm hence arguing for that.
But even if I had, wouldn't you equally be a shill for having invested in companies that merely exist for the sake of cryptographic functionality? Do you think any FAANG would be able to exist without cryptography? Do you hold any kind of stock? Because if so, your incentives aren't likely more inspiring than mine.
"Crypto" only means cryptography in technical circles. The average person speaking colloquial English does not know or need that abbreviation.
Whereas the average person buying cryptocurrency does need an abbreviation for cryptocurrency and since "crypto" is vacant for them the abbreviation is made.
Not really? Context matters and all that. I have yet to encounter someone mistaking crypto[graphy] for crypto[currency] or the other way around. It’s just that finance is more relevant than encryption in most conversations where the participants are mostly unfamiliar both fields.
I mean, just enter 'crypto' in your search engine of choice, and check the cryptocurrency/cryptography ratio in the results.
This ratio closely resembles what I hear about whenever I hear the term, and I actually have a cryptography function in my company's product. For regular people the ratio will be even more extreme.
Isn't tether going to implode pretty much any year now? I'm relatively uninformed, but people keep saying they're playing with fire. Animats did a nice breakdown of this within the last several months. (Boy, corona time is weird.)
Yes. Tether skeptics have already been right a few times: the Bitfinex connection (which was denied until it came out in the paradise papers), not being directly dollar-backed, being under-collatoralized for at least a period of time (per the NYAG investigation).
Do people suddenly believe they’ve gotten honest, even though nobody in the commercial paper market they are supposedly a big player in have heard of them?
The article is right that as of now , exchanges are casinos. You can easily pump up coins with a few orders and watch if the rest of the herd will bite. There's not much use of them otherwise. Ironically, Coinbase is basically a child of US protectionism that keeps other exchanges away. At some point we must realize that exchanges are the problem, because they centralize activity and become a target for hacking, regulation and centralization. The article is right, that these exchanges have the power, since they are the gatekeepers. But i somehow think that that tech will be over time embedded in desktops and phones, we won't need exchanges.
The problem for whom though? Clearly not the problem for the exchanges themselves, owning a busy exchange brings huge amounts of money and power (just look at the coinbase IPO). It's also not a problem for their users, who clearly indicate by their behavior that they prefer to store their coins in exchanges over having to store everything themselves. It's not a problem for the miners and protocol devs either, they don't care either way. And finally any governments are more likely to prefer exchanges over individual holders because it gives them a single point of contact.
So, everyone with any power prefers exchanges. The only people who don't are those with no means to move users away from the exchanges.
Problem for the users. Exchanges are convenient in the same sense that FB or twitter is convenient. The point of decentralized finance is not to re-centralize finance or else it will have reinvented a slower wheel. As always with tech , you get what you incentivize. If we are incentivizing users to lock themselves inside new walled gardens called "exchange" then we actively promoting evil.
Well you phrase it as "we are incentivizing" but I'm certainly not on the dev team for any crypto (or exchange for that matter). How could you incentivize those dev teams to make exchanges undesirable for the average user? I think it would be very hard, because a dev would benefit most from mass adoption of "their" coin and mass adoption is currently only possible through exchanges. Self-hosting is either too difficult or too dangerous for most would-be users.
In any case you state it as a fact that users should want to give up convenience for independence, but simply by observing their behavior we can conclude that most users don't give a shit about anything except convenience (perhaps because they are already so wrapped up in whatever society they live in that independence is not really possible anyway). Until you manage to change that, persuading users to give up convenience for a higher cost and higher complexity solution is always going to be an extremely uphill battle.
I agree with you that exchanges are the problem, in that you are just reinventing banks, but with worse regulation and extra steps, both cost and environmental.
I would though suggest that cryptocurrencies wouldn't be fraction of where it is right now without exchanges enabling everyones grandma to easily enter the casino and pumping up the pyramid scheme.
Then i would prefer if bitcoin falls down to $10000 and people start working on actually integrating these payments to the things i use every day (like, this browser?). It feels like we are living the era of future bubbles, where nobody wants to deliver anything because they are afraid that they will break the rally of their stock/coin. We should have a name for this weird era.
Well bitcoin still has dollars in transaction fees, so that renders it useless for any day to day purchases. There are feeless blockchains like NANO which solve many problems but mostly get ignored because they can't be mined and people can't create currency out of thin air.
What people are missing is that crypto is its own self perpetuating economy at this point, even if it's mostly scheme based.
>At some point we must realize that exchanges are the problem, because they centralize activity [...] But i somehow think that that tech will be over time embedded in desktops and phones, we won't need exchanges.
Exchanges of some type will always exist and get re-invented as an emergent phenomenon of humans' desire for efficiency.
- a seller wants to sell something (corporate stock, or commmodity like corn or oil, or collectibles like Nike shoes, cryptocoins, etc) ... but doesn't know who the future unknown buyers will be to fetch the highest price
- a buyer wants to buy something ... but doesn't know the future unknown sellers to try and find the lowest price -- or even availability of an item at any price -- such as hard-to-find NVIDIA video cards
Those 2 forces of each side trying to maximize a marketplace will naturally re-create exchanges. Yes, they are "centralized". That's kind of the point because people value efficiency in finding each other to transact.
There is no computer science technology that lets buyers & sellers store future unknown market participants locally on their smartphones. Likewise, if you try to get around not having hubs/exchanges on a p2p network by constantly broadcasting buy/sell bids/asks, you're basically asking a billion local devices to recreate in their limited RAM a virtual "order book" of which all participants have an incomplete picture of the total market (because time limitations of network hops, latency, etc) -- which means less optimal selling & buying prices. You're also overwhelming the p2p network with traffic for "bids/asks" (pinging price queries) rather than "settlements" (finalized transactions).
In analogous desire for efficiency, this is why p2p bittorrent still has hubs like tracking servers because people want to find the files faster than waiting for cascading peer queries.
EDIT reply to: >Decentralized exchanges exist
Yes, DEX like Uniswap exist but they do not solve the same problems as centralized exchanges and market makers. There is no protocol invention or DEX that can prevent the re-emergence of centralized exchanges because there's always a gap in desirable functions (efficiency, discoverability, liquidity, convertibility, etc). E.g. convert to fiat on Uniswap not currently possible: https://www.google.com/search?q=uniswap+convert+to+fiat
> CZ predicts 80% of people will accept crypto payments within five to ten years.
That's a very specific prediction. I'm going to predict that this will not happen. In fact if it's 1% I would be surprised. The reasons are that the systems simply couldn't support such a transaction rate, and it's far too volatile to be used a currency. (And anyway how many businesses accept gold as payment? Approximately none)
One would assume that Visa (yes they already announced support of crypto) etc transactions would be off-chain, so network transaction rate isn't that important.
You'll be surprised to know that a cryptocurrency transaction is a record on a ledger of a transfer of some value. Whether it happens "off-chain" or not does not discount it being a crypto-currency transaction. What the poster above is referring to are "level 2" solutions, for example [1] the Lightning Network for Bitcoin. In short, the crypto is being transacted on one network, then that record is finalized along with others on the Bitcoin ledger.
So it will be cryptocurrency in name only. We are truly living through a bubble of stupid money. I have no idea where it's headed but I hope anyone getting hurt can take it.
How is that different from just settling between banks? There's an end record of transactions with traditional banks already. You just trust the end result to be accurate.
The only selling point of bitcoin was that everything was recorded and immutable, and thus volume was transparent. If all of these transactions happen outside of the blockchain (until later, maybe) you can fudge around with trading volume, and game the market, which exchanges have already done.
You are literally just describing banking as it has existed forever, but with less oversight.
I am describing banking without the issues of banks. No need to have a headache because my transaction from Iran to EU is lost somewhere in between without any traceability whatsoever, etc; no need to have a headache because the receiver didn't realize it'll cost them $100 to receive money internationally, etc; no need to think about the hardship of pulling my own money out of the bank while I'm not in my home country, etc...
Then there's smart contracts - show me a bank that supports it? Show me groups of banks (because not everyone has the same, right?) that support it among each other?
> all of these transactions
Again, that's your mistake. That most transactions happen off-chain doesn't mean all or the important ones do. And it also doesn't mean there aren't cross off-chain network transactions - e.g. VisaBTC to MCBTC needs a blockchain to happen in a trustless way. Trust is easy when it's Visa to MC but not so easy when it's EU to Iran banking system.
> Again, that's your mistake. That most transactions happen off-chain doesn't mean all or the important ones do. And it also doesn't mean there aren't cross off-chain network transactions - e.g. VisaBTC to MCBTC needs a blockchain to happen in a trustless way. Trust is easy when it's Visa to MC but not so easy when it's EU to Iran banking system
Doesn't matter if it's all, just that some can be. The issue is that the transaction ledger and the "currency" or asset is the same thing. That exchanges or Visa et al are implicitly trusted with out-of-blockchain transactions means that there's no longer a natural relationship with the finite number of BTC or the veracity of the blockchain. You have just started outsourcing trust again, which IMO is fine, but why the rodeo then.
Pick a lane, you can't have both. It's no longer trustless if you try to do both, at least not on the (speculated) asset value level.
I am going to prefer on-chain BTC transactions to make international business transactions in thousands of USD.
I don't need the full force of trustlessness to buy my lunch - the risk to me is that I get a free lunch. Yeah I could use a classic payment card - but then I'd have to keep shuffling my funds around and that's not fun.
No you don't. You have a speculative asset no longer bounded by the designed limit of BTCs, where banks, i mean exchanges, can create volume out of thin air outside of the ledger, as long as something is later cleared on-chain. Ergo, back to square one.
Things have moved very quickly since this was true. For comparison, [1] Visa claims at it's maximum to achieve 24,000 transactions per second (tps), and Mastercard 5000. The work on the Bitcoin Lightning Network is moving ahead to help achieve [2] "approximately 1 million transactions per second."
Another crypto currency in use today is Solana. That runs at around 50,000 tps, beating the higher end of today's credit processing networks.
So far no one really could use cryptocurrencies as currencies because of this, they remain an asset class, in truth a Ponzi scheme. Circumventing governments, banks and payment processors seems alluring until you realize that there is a reason for every single regulation. Once you learn all the lessons you are back to fiat money and centralized banking systems despite their imperfections.
It's like those hippies in that South Park episode.
Man 2: Right now we're proving we don't need corporations. We don't need money. This can become a commune where everyone just helps each other.
Man 1: Yeah, we'll have one guy who like, who like, makes bread. A-and one guy who like, l-looks out for other people's safety.
Stan: You mean like a baker and a cop?
Man 2: No no, can't you imagine a place where people live together and like, provide services for each other in exchange for their services?
Kyle: Yeah, it's called a town.
Driver: You kids just haven't been to college yet. But just you wait, this thing is about to get HUGE.
We have public blockchains deployed today that can do tens of thousands of transactions per second, and those transactions can be for tokenized fiat currency.
A lot of energy and effort is put in playing the game of "guessing" how much a given "currency" is worth to others who are also guessing ... etc.
Strategies range from ... fancy analytical methods finding intricate patterns in order to try to capitalize from inevitable regularities by magnifiying fluctuations on a short time scale and maximizing frequency ... to mining, staking ... to simply HODL.
Not to mention the f*ery on top and in between trying to profit from common "strageties" by pumping, hyping, dumping, inducing FUD ... finally knighted by tweets of centibillionaires.
Every "currency" afaik (which is transparent of course) is a disaster in terms of wealth distribution. It is not a trivial issue to solve and some inequality is healthy and desirable but for me it still remains the big elephant in the room nearly everybody invested in the "crypto space" - understandbly so - glosses over some to the point of simply equating technologically decentralized = sociologically decentralized eg DeFi.
Another example to better illustrate my point:
The game "monopoly" was meant to be educative and enlighting on the destructive centralizations at the beginning of the 20th century but the board game was enjoyed so much that its "purpose" is now a long forgotten remnant. I kind of feel the same when looking back at the original paper "A peer to peer electronic cash system"
published in the wake of the "banking crisis". The game of betting on the right coin to attain "LAMBO" (the "Hotel" in Monopoly-Lingo) is enjoyed so much that it ends to be ironically - beside all honorable intentions - the driving force.
77 comments
[ 4.7 ms ] story [ 158 ms ] threadGet off my lawn!
Anyways, the definition of "reactionary" is to hold onto an outdated believe or assumption. Crypto means cryptocurrencies these days. I was just stating the obvious.
So, let me just say, I'm not trying to weirdly argue with by saying you're right, and still the word can be overloaded. Idk language is weird.
Haha in 20 years maybe crypto will be abject failure and it'll become synonymous with pumping and dumping, like "pyramid" scheme, or maybe it'll be a huge success the likes of which no one has ever seen and will be used in that way in certain contexts.
But even if I had, wouldn't you equally be a shill for having invested in companies that merely exist for the sake of cryptographic functionality? Do you think any FAANG would be able to exist without cryptography? Do you hold any kind of stock? Because if so, your incentives aren't likely more inspiring than mine.
"Crypto" only means cryptography in technical circles. The average person speaking colloquial English does not know or need that abbreviation.
Whereas the average person buying cryptocurrency does need an abbreviation for cryptocurrency and since "crypto" is vacant for them the abbreviation is made.
Where do you think you are, dude?
This ratio closely resembles what I hear about whenever I hear the term, and I actually have a cryptography function in my company's product. For regular people the ratio will be even more extreme.
I would prefer for it to mean cryptography, but this ship has sailed, and we have to accept it.
Do people suddenly believe they’ve gotten honest, even though nobody in the commercial paper market they are supposedly a big player in have heard of them?
The problem for whom though? Clearly not the problem for the exchanges themselves, owning a busy exchange brings huge amounts of money and power (just look at the coinbase IPO). It's also not a problem for their users, who clearly indicate by their behavior that they prefer to store their coins in exchanges over having to store everything themselves. It's not a problem for the miners and protocol devs either, they don't care either way. And finally any governments are more likely to prefer exchanges over individual holders because it gives them a single point of contact.
So, everyone with any power prefers exchanges. The only people who don't are those with no means to move users away from the exchanges.
In any case you state it as a fact that users should want to give up convenience for independence, but simply by observing their behavior we can conclude that most users don't give a shit about anything except convenience (perhaps because they are already so wrapped up in whatever society they live in that independence is not really possible anyway). Until you manage to change that, persuading users to give up convenience for a higher cost and higher complexity solution is always going to be an extremely uphill battle.
Yeah what i m saying is people should invest in tech that makes the "right" way more convenient
I would though suggest that cryptocurrencies wouldn't be fraction of where it is right now without exchanges enabling everyones grandma to easily enter the casino and pumping up the pyramid scheme.
What people are missing is that crypto is its own self perpetuating economy at this point, even if it's mostly scheme based.
https://block.xyz/
Exchanges of some type will always exist and get re-invented as an emergent phenomenon of humans' desire for efficiency.
- a seller wants to sell something (corporate stock, or commmodity like corn or oil, or collectibles like Nike shoes, cryptocoins, etc) ... but doesn't know who the future unknown buyers will be to fetch the highest price
- a buyer wants to buy something ... but doesn't know the future unknown sellers to try and find the lowest price -- or even availability of an item at any price -- such as hard-to-find NVIDIA video cards
Those 2 forces of each side trying to maximize a marketplace will naturally re-create exchanges. Yes, they are "centralized". That's kind of the point because people value efficiency in finding each other to transact.
There is no computer science technology that lets buyers & sellers store future unknown market participants locally on their smartphones. Likewise, if you try to get around not having hubs/exchanges on a p2p network by constantly broadcasting buy/sell bids/asks, you're basically asking a billion local devices to recreate in their limited RAM a virtual "order book" of which all participants have an incomplete picture of the total market (because time limitations of network hops, latency, etc) -- which means less optimal selling & buying prices. You're also overwhelming the p2p network with traffic for "bids/asks" (pinging price queries) rather than "settlements" (finalized transactions).
In analogous desire for efficiency, this is why p2p bittorrent still has hubs like tracking servers because people want to find the files faster than waiting for cascading peer queries.
EDIT reply to: >Decentralized exchanges exist
Yes, DEX like Uniswap exist but they do not solve the same problems as centralized exchanges and market makers. There is no protocol invention or DEX that can prevent the re-emergence of centralized exchanges because there's always a gap in desirable functions (efficiency, discoverability, liquidity, convertibility, etc). E.g. convert to fiat on Uniswap not currently possible: https://www.google.com/search?q=uniswap+convert+to+fiat
- Changpeng Zhao of Binance
- Arthur Hayes of Bit mex
- Brian Armstrong of Coinbase
That's a very specific prediction. I'm going to predict that this will not happen. In fact if it's 1% I would be surprised. The reasons are that the systems simply couldn't support such a transaction rate, and it's far too volatile to be used a currency. (And anyway how many businesses accept gold as payment? Approximately none)
[1]: https://cointelegraph.com/bitcoin-for-beginners/what-is-the-...
Says who? You've just ignored the trustless part of cryptocurrency, what are you left with?
I get the hypothetical of why [cryptocurrency of choice] could be useful, even if I don't subscribe to the idea of a trustless society functioning.
But if you sidestep the one thing it's laboriously designed for (trustless by PoW, or stake/other), why even bother?
I don't have to sidestep it forever and ever since I buy lunch via VisaBTC. And me buying lunch changes nothing about me receiving funds.
The only selling point of bitcoin was that everything was recorded and immutable, and thus volume was transparent. If all of these transactions happen outside of the blockchain (until later, maybe) you can fudge around with trading volume, and game the market, which exchanges have already done.
You are literally just describing banking as it has existed forever, but with less oversight.
I am describing banking without the issues of banks. No need to have a headache because my transaction from Iran to EU is lost somewhere in between without any traceability whatsoever, etc; no need to have a headache because the receiver didn't realize it'll cost them $100 to receive money internationally, etc; no need to think about the hardship of pulling my own money out of the bank while I'm not in my home country, etc...
Then there's smart contracts - show me a bank that supports it? Show me groups of banks (because not everyone has the same, right?) that support it among each other?
> all of these transactions
Again, that's your mistake. That most transactions happen off-chain doesn't mean all or the important ones do. And it also doesn't mean there aren't cross off-chain network transactions - e.g. VisaBTC to MCBTC needs a blockchain to happen in a trustless way. Trust is easy when it's Visa to MC but not so easy when it's EU to Iran banking system.
> You just trust the end result to be accurate
Hahahaha, good luck in Africa...
Doesn't matter if it's all, just that some can be. The issue is that the transaction ledger and the "currency" or asset is the same thing. That exchanges or Visa et al are implicitly trusted with out-of-blockchain transactions means that there's no longer a natural relationship with the finite number of BTC or the veracity of the blockchain. You have just started outsourcing trust again, which IMO is fine, but why the rodeo then.
Pick a lane, you can't have both. It's no longer trustless if you try to do both, at least not on the (speculated) asset value level.
I am going to prefer on-chain BTC transactions to make international business transactions in thousands of USD.
I don't need the full force of trustlessness to buy my lunch - the risk to me is that I get a free lunch. Yeah I could use a classic payment card - but then I'd have to keep shuffling my funds around and that's not fun.
No you don't. You have a speculative asset no longer bounded by the designed limit of BTCs, where banks, i mean exchanges, can create volume out of thin air outside of the ledger, as long as something is later cleared on-chain. Ergo, back to square one.
Another crypto currency in use today is Solana. That runs at around 50,000 tps, beating the higher end of today's credit processing networks.
[1]: https://utilli.com/2021/04/26/the-lightning-network-is-poise... [2]: https://www.kraken.com/en-us/learn/lightning-network
It's like those hippies in that South Park episode.
Man 2: Right now we're proving we don't need corporations. We don't need money. This can become a commune where everyone just helps each other.
Man 1: Yeah, we'll have one guy who like, who like, makes bread. A-and one guy who like, l-looks out for other people's safety.
Stan: You mean like a baker and a cop?
Man 2: No no, can't you imagine a place where people live together and like, provide services for each other in exchange for their services?
Kyle: Yeah, it's called a town.
Driver: You kids just haven't been to college yet. But just you wait, this thing is about to get HUGE.
https://en.wikipedia.org/wiki/Semantic_change
Strategies range from ... fancy analytical methods finding intricate patterns in order to try to capitalize from inevitable regularities by magnifiying fluctuations on a short time scale and maximizing frequency ... to mining, staking ... to simply HODL. Not to mention the f*ery on top and in between trying to profit from common "strageties" by pumping, hyping, dumping, inducing FUD ... finally knighted by tweets of centibillionaires.
Every "currency" afaik (which is transparent of course) is a disaster in terms of wealth distribution. It is not a trivial issue to solve and some inequality is healthy and desirable but for me it still remains the big elephant in the room nearly everybody invested in the "crypto space" - understandbly so - glosses over some to the point of simply equating technologically decentralized = sociologically decentralized eg DeFi.
Another example to better illustrate my point: The game "monopoly" was meant to be educative and enlighting on the destructive centralizations at the beginning of the 20th century but the board game was enjoyed so much that its "purpose" is now a long forgotten remnant. I kind of feel the same when looking back at the original paper "A peer to peer electronic cash system" published in the wake of the "banking crisis". The game of betting on the right coin to attain "LAMBO" (the "Hotel" in Monopoly-Lingo) is enjoyed so much that it ends to be ironically - beside all honorable intentions - the driving force.