The question being put to crypto isn't "can you come up with something that it can do"; it's "can you come up with something that will see mainstream use that eclipses the toxic speculation that's perceived to characterize every crypto application".
I don't claim to have a dispositive argument here, but I also don't think crypto advocates do either.
This is a far better question to put to crypto.
The article isn’t attempting to address that question though.
My bet is “yes”, at maybe 80% confidence. I would say it’s fairly difficult to see though, because speculative projects grow very quickly and dwarf “normal” projects, setting unrealistic comparisons.
Both crypto skeptics and crypto promoters tend to be blinded by candlestick graphs.
The total number of active wallets is still fairly small (a few million), and so a “non-speculative” project doesn’t “seem” like a major project when folks attempt to compare its market cap against speculative projects.
For example, Dark Forest is fairly popular, but isn’t explicitly a speculative project. And so few folks outside of crypto have heard of it.
Crypto suffers from the problem that the speculative parts are mainstream (or at least, are very well known about), but non-speculative use cases are not.
I think this problem is mostly solved by the bubble popping. Crypto-skeptics can pat themselves on the back for predicting the obvious, but may end up being wrong long term because they missed the relatively “small” non-speculative projects.
Like, HTTP isn't a product; but a web browser uses HTTP as a feature, and so do web servers. But they aren't the whole product either.
And the categorical error is that traditional finance sees its protocols as products, but they're actually on the road to commodified features. It's easy to "print new money" now, so that's not the part of the value chain that matters.
Why would I want to hitch my wagon to that star? What will happen if the speculation dies down and the ledger isn't so widely distributed anymore?
What is a non-speculative project? How can you deter speculation? By maintaining a high supply inflation for a long time?
Darknet markets. Lots of drugs and lots of illegal materials are bought and sold using crypto, like stolen cards and child porn.
So, “if you are child porn enthusiast, you are maybe using cryptocurrency” might be a valid usecase.
However I don’t know how prevalent crypto is in any of these. I haven’t read any studies on it, and they might be hard to do.
I don’t think any of the big drug cartels actually use cryptocurrency, for example, but I might be wrong.
What's surprising about crypto however, is that this "second wave" of usages should already start to appear by now, and yet we don't see any sign of them.
Just because something isn't AWS doesn't mean that it's useless. I think that's part of the point the OP was making: people keep moving the goal post and because of that, their argument is not falsifiable.
The basic premises of crypto are to be decentralized and permissionless systems that support peer-to-peer forms of exchange and ownership, and they largely succeed in their defined goals. The goal of these protocols is to provide new tools, not to replace every corner of fiat and financial systems.
They... they don't succeed. Like, at all. Except for a tiny bit in their own digital bubbles where everything is defined in crypto. And even there it's highly questionable.
Both are probably pretty small numbers.
Identity plays are tricky commercially but there do seem to be some interesting shoots of growth around it.
The only reason anyone cares about blockchain is because of the ability to speculate. Remove that and it's a tiny niche tech - which certainly has use cases but nothing you can build a Facebook or Google around.
it be nice to prove identity via a public key, but the private key can't be trusted as the authority. They get compromised too often
This actually proves that there isn't a real use case of Filecoin aside from speculation. Amazon isn't making 99.9989% profit margins on S3, nor is it possible for Filecoin to be a hundred thousand times more efficient than S3. This means that Filecoin's storage product is so uncompetitive that you need to subsidize it a hundred thousand times just to get people to use it.
> Toucan - Tradable Carbon Credits
All the other use cases listed look like parodies of crypto products with plenty of buzzwords, and no real substance. However, this one is especially nonsensical. From their website:
> Working with top DeFi protocols and the community we enable carbon credits to be used as collateral, yields and money, as well as a huge range of novel applications.
That's literally missing the point of buying carbon credits. The only use case for buying carbon credits to blackhole them immediately, so that you can feel like you're offsetting your emissions. There is no reason to resell them. Even if you did want to resell them because you overestimated your carbon footprint and have some left "unused", no buyer has any reason to believe you. If there is anything carbon credits need, it's more centralization and trust, not less.
Excellent relevant Wendover video about carbon credits: https://www.youtube.com/watch?v=AW3gaelBypY
A few months ago I tried for a couple hours to figure out how to get files onto the filecoin network and I could not make heads or tails of it. There were some services that used it as a backend, but that wasn't my goal and they had weird pricing too.
Wikipedia says "As of February 2022 the total storage capacity was 15.6EiB, and total data stored was 40 PiB."
Clearly something's wonky here if it's so cheap and so empty. Does anyone understand what's going on there?
For comparison I could mention something like Sia, which seems to be put together fine and comprehensibly, but the total size is single digit petabytes so it's completely irrelevant on a global scale.
As for this:
> Right now, you can take out a loan without involving a bank from one of the many crypto lending protocols. You put up some collateral and can take out a loan for extremely cheap, because there isn't a bank in the middle to take a cut.
The reason loans on the blockchain are cheap is not because there's no middle-man but because they're over-collateralized so there's no risk. One of the reasons the bank charges you interest is that they're taking a risk that you will not pay back the loan. AFAIK this is not possible in DeFi.
"Loan" is a very misleading description of what this is. This is margin trading. A loan is when you post a non-liquid asset in the real world -- like a house -- as collateral. Margin trading is when you post a fairly liquid asset (like other cryptocurrencies) as collateral so that you can buy more cryptocurrencies. You can't use these "DeFi loans" to buy a house in the real world.
One reason I think DeFi is bullshit is because its critics describe what it does better than its advocates, who spout incoherent word salad.
I affectionally call it crypto-babble.
> critics describe what it does better than its advocates
Seems to be true of pretty much all crypto. Most of the advocates have a very poor understanding of how it works, what the benefits/tradeoffs are and worst of all a complete ignorance of the systems they are seeking to "replace".
As a result we see all the crypto stuff simply repeat mistakes/failures/weaknesses that have been known in financial systems for around a century or more in most cases.
As a peer comment says, collaterlised lending is very popular in traditional finance to avoid taxable events and gain leverage.
There are plenty of critiques around Crypto but this isn’t one of them.
You can if the person selling the house agrees to accept the token (likely some form of stablecoin). Whether that matches your definition of 'real world' or not, these things have happened already. We will probably see less of this in the US, but I can imagine someone in another country gladly accepting tokens. I don't see why this is so far fetched at this point.
Yes you can, the same way you can with stocks. But yes as you said, you need to have more crypto than the house is worth.
Sure you can. Take out a loan, convert it to USD at an exchange, withdraw into your bank account, buy a house.
Either I can't actually buy things with "crypto" in the world where grown ups reside or I don't want to part with it because I see it as a speculative investment/gambling.
That's why there are options markets like, Nexus Mutual [1], that allow third parties to take on that risk.
You’re talking apples and oranges.
I think, given recent blowups, it could be related to limits on rehypothecation. But hard to know for sure.
Ford F-150s are successful at being money. If you don't believe me, then I'm happy to sell you the laptop I'm writing this on for 1,000 Ford F-150s instead of 1,000 USD.
A slightly stronger example might be gold, but people don't use gold as money anymore either.
Gold stopped be used as money because people weren't really using it, they were using tokens pegged to it under a promise. That promise went away. Gold isn't exactly fungible (purity, fake gold etc), and it isn't easy to move in significant quantities. Gold makes for absolutely shit money in the 21st century
Plenty of settlement systems permit arbitrary precisions of dollars. It’s just useless for day to day purposes for most people, so a consumer version never took off.
Also frankly, if I'm paying as little as 0.001 Nano, then probably I don't actually care about your article and reading it is pure procrastination on my part, so I'm likely better off not doing so. Thanks for putting up your paywall :)
A) it's a great speculative asset. Huge volatility in value means fortunes can be made (and lost) in days not lifetimes. All those crypto ads on the radio talk about "investing" in Bitcoin - marketing it as an asset, not about using it as currency. It appears to be a zero sum game. I'll make no judgement about its actual value as an asset.
B) it makes illegal transactions safer by removing the need to be physically present to receive cash. This simplifies things like drug deals, and of course with digital goods makes things like ransomware possible.
Crypto already has two killer apps, it's just not the killer apps they wanted it to be.
I agree that the second case, illegal transactions in any form, is the only real killer app for crypto.
If you are a Russian oligarch, it's great for being able to pay your superyacht crew.
"useful"
and
"no use case"
are not the same thing.
Clearly anyone who isn't completely blind can see that you can use crypto for some things. It's pretty easy to demolish the strawman that is 'there is nothing to can use that for'.
...but given that technically it's like an unregulated, very slow, very expensive payment system, it's far harder to swallow the idea that it has compelling use cases, by which I mean, "I would be convinced to use this" unless:
- you are doing something that is illegal
- you're doing something traditional payment providers don't allow
- you want to avoid taxes / tariffs (see, doing something illegal)
- you want to avoid the red tape to do something (eg. banking, coin offering)
- you're speculating
Otherwise, you can just using something else, that is faster, simpler, cheaper and safer (ie. legal protections, etc.).
Many of the 'novel' ideas in crypto like asserting ownership via NFTs, smart contracts, etc. are not fundamentally restricted to crypto; you could run them centralized, and it would make almost no difference at all. You'd still have a CoinSpace wallet that you convert USD to CoinTokens on, and upload your smart contracts to.
The crypto part of this is not compelling, it's just a pain in the ass to deal with, technically, and commercially toxic by association with bad actors.
On top of that, the crypto is fundamentally worthless unless you have people who want to buy it, so it is in bad faith that most crypto proponents advocate for it; it is in their interests, not yours, to be involved with it.
Which is basically impossible. It's a distributed ledger and the IRS has chain analysis software.
> - you're doing something traditional payment providers don't allow
So no one has ever complained about Paypal? Seems to be a recurring theme on HN.
> - you're speculating
Which is exactly about Y Combinator is about?
I personally think Uber and Facebook are scams. Uber ignored regulation and started its business without getting permission. Facebook tries to convince young people to spend more of their time doing worthless things. And yet a lot of people here are being paid big bucks by these companies and loving it!
The modern internet is just a cess pool. Crypto skeptics want us to believe that everything else on the internet that came before it has a purpose and is justified. But really the modern internet is making society worse.
One beneficial use case from the US perspective is further global dominance of USD (if you are into that sort of thing). This limits the ability of corrupt governments from inflating their fiat, which is generally a worse currency than USD fiat.
How much was paid in fees in total, from your currency to theirs (I assume VND)? If it's a USD stablecoin, I assume they still had to convert it to VND, or at least they'd have to if they were paid mostly like this (to pay their taxes).
Wise and others are quite cheap for the currencies they support.
When people say “there are no use cases for crypto,” they’re actually saying “there are no use cases that aren’t solved better elsewhere.” This is the question he needs to answer and he doesn’t do so.
Looking at the money example, he says he’ll sell his laptop for Etherium. That’s fine but if nobody is willing to buy it with Etherium, he can’t sell his laptop and Etherium is de facto not being used for money.
Because he always skips this crucial last part, he never proves his argument.
Uniswap as the author mentioned is a good example, in that it provides an exchange that allows users to trade tokens without reliance on a central company like Coinbase. This allows users to hold and exchange USD pegged assets like USDC and DAI in a non custodial fashion, and also take part in defining, improving, and even forking the Uniswap protocol if they want to, as it is not privately owned.
2 things:
1. No it doesn’t.
2. Nobody cares.
“Centralised” isn’t a problem. If it causes problems you need to demonstrate that and then show how blockchain solves that problem and how existing solutions can’t. I’ve seen no examples of that (Uniswap isn’t an example).
The proper question is what does cryptocurrency do better than alternatives? On the whole... I think bypassing financial controls to enable ransomware is not an improvement on the previous system.
Bitcoin, as one example, does a better job limiting supply and preventing inflation than its fiat alternatives.
Of course, this doesn't make the article any less of a strawman.
You assume that's a plus, but most of the world acts on the opposite assumption, i.e. NAIRU-like policies. I'm not picking a side, just pointing out that you disagree with almost every expert on the planet.
> Few technologies have a clear start point. Did the internet start in Tim Berners-Lee in 1990? Or in 1982 with TCP/IP? Or in the 1970's with CYCLADES? Or in 1969 with ARPANET? Or in 1965 with the invention of packet switching? Or in 1950's with time-sharing?
No, the web started in 1989 with Berners-Lee’s original proposal. The internet started in 1983 with TCP/IP (the Internet Protocol) being used for ARPANET. These are common, widely cited timeframes.
> Can you distinguish the internet from computers or information theory?
Yes, the internet is a network of networks made up of computers. A computer is not the internet. Information theory is the theoretical study of information and entropy started by Claude Shannon.
> If you don't believe me, then I'm happy to sell you the laptop I'm writing this on for 1,000 ETH instead of 1,000 USD.
Great, I’ll help you move house for a pizza, but that doesn’t make pizza money. The fact of the matter is, I can’t buy hardly anything with cryptocurrency except other cryptocurrencies. This is made more difficult even for companies that want to offer goods for crypto by the fact there is no stable exchange rate to USD.
> Right now, you can take out a loan without involving a bank from one of the many crypto lending protocols.
Lol, was this written before or after the collapse of Luna, Three Arrow Capital, and Celsius? Not to mention the numerous bridge hacks. I guess technically, sure, this is a valid (ie possible) use case of crypto, but not a strong one.
> You may point to hacks
I would argue a malfunctioning lending protocol is as good as no lending protocol, but again, this is a matter of opinion.
> Filecoin
Interesting use case for sure, but unfortunately it seems difficult to participate (and I initially had interest in doing so). IPFS is much further along development-wise. You may say “oh well this is still a use case of crypto” but… not really. I mean sure I can get paid in $FIL but if $FIL is useless in the real world (basically my earlier critique that it is not money) then why would I want to get paid in it?
Overall, I want to agree and perhaps it’s just a couple years too early, but as of now, this is too strong of a claim to make, or at least too weak of an argument to support it.
> Lol, was this written before or after the collapse of Luna, Three Arrow Capital, and Celsius
These have about as much to do with decentralized lending as Citadel and JP Morgan have to do with point of sale payment processing
a loan that might double in the amount of fiat you have to pay back isn’t cheap, it’s nuts. Also there’s significant cost converting to and from fiat to take it out
> filecoin
https://randomoracle.wordpress.com/2019/12/07/filecoin-storj...
> LabDAO Toucan Golden.xyz
Why not just a centralised database though?
> Radicle.xyz
OK sure, if you have code that GitHub won’t accept, then this looks ok, but presumably it either has a mechanism to stop CSAM on it, at which point it can also be censored, or the Feds are coming for you if you run a node…
> Helium - Incentivization layer for the LoRaWAN network
Some kind of payment mechanism for sharing Wi-Fi? I didn’t have time to dig deep enough, but almost certainly a centralised authority would work better because it almost always does
> NFTs
Better handled by a central authority, and looks like OpenSea is already acting as one re stolen apes etc
> A blockchain is not a database … A blockchain is an escrow without a third party
And the lack of use-cases for that is the reason there are so few use-cases for blockchain
No there's not. Trades on exchanges are under 0.1% [1]. ERC20 tokens have some fees because of gas but it's a flat amount [2], which is negligible for any operation over a thousand dollars. Fiat withdrawals are generally free [3]. The most expensive part usually is the gas to interact with the DeFi smart contract, but it's also a flat fee.
[1] https://help.ftx.com/hc/en-us/articles/360024479432-Fees
[2] https://etherscan.io/gastracker 0.75USD as of now, but it can reach like 10USD when the network is congested.
[3] https://help.ftx.com/hc/en-us/articles/360043023772-Depositi...
Let's say I am the type of person who needs a cheap loan, and I decide to use Coinbase. My understanding is that money into Coinbase and money out of Coinbase is going to cost me 1.49% (at least) in each direction, and that's before the additional $1-$10 gas fees in each direction. So 3% + currency risks + whatever other fees + the risk of fat-fingering my crypto and losing it to the ether forever, and also trying to figure out if I have some kind of tax liability, BEFORE the actual interest rate itself.
Or I choose a well-regulated provider to do a money-transfer[0] to and pay a one-off fee of 3-4% for several thousand pounds for a year or longer loan, even if my credit isn't perfect, and I do that with the full protection of the legal system, including bankruptcy protection, easy resolution if I type the wrong account number in, etc. Those are the rates for if I need cash too, if the thing I need to pay for can be paid for by credit-card, the rate falls to closer to 2%...
[0] https://www.moneysavingexpert.com/credit-cards/money-transfe...
So, useless on a day to day use for any normal person that's not a Silicon Valley tech bro, understood.
Another one is decentralized compute.
AWS pioneered taking unused compute and commoditizing it. Well, there is a lot of unused compute in the world and building ways to take advantage of it is part of what I see 'web3' as being about.
PoW mining, however "wasteful", is still a great example of allowing anyone to effectively participate in the validation of transactions and getting rewarded for doing so. If you think of miners as a business, the 'customers' for miners are people submitting transactions, yet these business don't actually 'know' their customer at all. That's web3 decentralization (not silly NFTs).
Protocols like Akash allow anyone to effectively run K8S on their own infrastructure and get paid to do so... all the while, decentralizing the compute away from central locations like AWS / GCP. I personally find that concept fascinating and super cool.
Let's step outside of the box for a moment. If I'm in some other country and I don't have easy access to a credit card and I want to build out the next cool idea, how do I get access to scalable compute?
Looking at the calculator[0] the price fluctuates quite a bit. The 30 day average is 1 AKT/$0.35 while the current price is $0.215.
Secondly: Most of the blockchain use-case feel a little like the argument for Bittorrent. It’s not that you can’t use it for sensibel purposes, but when you do you’re solving problem most people don’t have.
I think cryptocurrency could be used to solve a micropayments problem, but I doubt it will ever catch on if it depends on internet companies' forward thinking and benevolence.
Have you looked at recent crypto currency research? ZK snarks and starks, multiparty computation, new polynomial commitment schemes and ZKP-friendly hash functions, new BFT consensus mechanisms. These are all novel solutions to age old problems.
The use cases are niche, partly because the technology still has a long way to go before it becomes user friendly. We are only on the cusp of seeing stablecoin regulation - a few years from now, with robust stablecoins, PoS, and scalable L2s, the applications and use cases might look entirely different.
Though I think the same thing could be accomplished on Ethereum with web3.
Of course running your own or shared DNS can have the same value, but I think Blockchain is a legitimate case for decentralizing domain names and having a record that can only be modified by the true owner.
I'm not casting judgement when saying this, but if there isn't a governing body then that's attractive to some people but a huge red flag for others.
A use case like Helium sounds useful, but using a Blockchain doesn't necessarily add obvious value. The fundamentals don't make sense, you pay for power in dollars but you're paid back in monopoly money. It makes it harder for users to understand the underlying costs... But then again, maybe ambiguity is the value proposition.
Yeah but... that does actually work... so... hmm.
> Crypto is successful at being money. If you don't believe me, then I'm happy to sell you the laptop I'm writing this on for 1,000 ETH instead of 1,000 USD.
How about 1000 kilos of gold? Or 1000 1 Carat Diamonds? Does that make diamonds good money?
> Right now, you can take out a loan without involving a bank from one of the many crypto lending protocols.
Yes, but you over-collateralise that loan, swapping tokens around to do so. It doesn't look a lot like lending, it looks more like obfuscation of naive/fraudulent claims of productivity mixed with a game of musical chairs. And right now loan platforms in the crypto space are in all sorts of trouble. Look at "Solend" which appears to have suffered from a large token-holder taking out loans as a way to exit a cryptocurrency that was traded too thinly to cash out directly.
Multiple DeFi lending platforms are mid-collapse, right now.
I really agree with this -
> In other words, crypto's use case is the one that it claims: decentralization.
It's just that that use-case is far less universal, useful or desirable than we have been lead to believe by the cryptocurrency hype factory. For the most part nobody cares, the people putting money into cryptocurrency just want somewhere to gamble, the people not into that aspect are not lining up to use the products of this space, because of that promise. And in many cases (irreversible payments with no oversight!) it's actively bad.
> "after 13 years, there are still no use cases for crypto" is not a rational fact
How about "after 13 years there are still no use cases for crypto that aren't done better without the crypto aspect, or aren't just fucking stupid to begin with?"
Because sure, there are some things you can do with blockchains and smart contracts, but honestly, why the hell would you?
> How about 1000 kilos of gold? Or 1000 1 Carat Diamonds? Does that make diamonds good money?
This is a good argument, but I think a better one would be that there is no way the seller is willing to sell any laptop for 1,000 ETH, given that the value of 1000 ETH as of writing is over 1.5m AUD.
If they gave me a quote for the actual value of the laptop in AUD (perhaps 1-2 ETH?) I would still say no, because the inherent volatility in even the most "stable" coins is too high. 2 ETH might be worth 3k AUD today, who knows what it will be when it arrives, let alone when I want to spend it.
Point of order, but "There are no use cases for crypto." is absolutely a falsifiable statement, and in fact this article goes on to falsify it.
Even "There are no powerful use cases for crypto." is falsifiable along the same lines (it's arguable if the article successfully falsifies this statement, however).
In the meantime, people may find it surprising that there is indeed no other use case for the most inefficient database man has ever conceived, other than the on e it was explicitly designed for.
Is any of that strictly needed, in a developed country with trustworthy institutions? Well, we could argue. But I think hackers agree that those are at least cool things to tinker with.
(And to those worried about environmental impact: the above doesn't apply to Bitcoin, and once Ethereum has switched to PoS, none of the relevant smart-contract-enabled chains will have that problem anymore)
I also believe that the current model of setting up networks can't keep up with a self improving network. Imagine a network that's always a top of the line network. That grows or shrinks as needed. Who will have the resources to compete with it?
Uber / Lyft is often more expensive than taxis, once the VC funding dried up.
That said, I still generally prefer shared rides cause it is an easy app to pull up on my phone.
This might sound strange or far-fetched, but many people who have been in this industry for a few years share a similar perspective.
If you think the economy is behaving increasingly insane, it's because it is. That's what you get when some entities have access to unlimited fiat. They spend most of it on anti-competitive activities.
It seems that you know what those use cases are but for some reason you are unwilling to share them here. Did the establishment get to you too or are you just talking out of your ass?
You'll find that these buyback-and-burn 'token as a share' projects which are backed by real economic value are suppressed even though they provide businesses with exposure to investors which represents real value for those businesses (and potentially to their investors). None of them ever end up growing to the point that they can become fully decentralized (though most of them look promising initially). Obviously many founders take 'bribes' (in the form of price pumps) to sabotage their own projects.
I've worked for such project before and watched it self-sabotage. It was very obvious but they started to hire a lot of people and adding more bureaucracy to make the business look more legitimate... But they achieved absolutely nothing in 5 years.
Is price the only criteria for file storage ?N What about performance, resilience, availability...
Are in-game NFT any more tradable than regular in-game items ?
His blurb actually took me a step further towards thinking that crypto is just a bunch of baselss claims. He sure does string them enthusiastically, with zero critical thinking.
In many ways it's like quantum computing vs. classical computing, everyone is very hyped about it, but no one knows exactly what we are going to do with it, and it isn't clear that the cost and difficulty of using it justify the somewhat ephemeral benefits.
It is kind of a blockchain with proof of authority. More precisely it is a Merkle tree with certificate authorities seen as trusted nodes by the web browsers. This idea was extended in something called General Transparency and implemented in the Google Trillian project: https://sites.google.com/site/certificatetransparency/genera...
You might be happy to sell it, but I am not happy to buy it using ETH. I think it's a bit silly that the author accuses critics of not understanding crypto, but they clearly don't understand money. I might miss something here, but I am afraid in their logic the Kuwaiti Dinar is somehow better than the Dollar because you need to pay 3 dollar to get a Dinar.
Edit: typo
In short, crypto is b2b and not B2C.
Did you say 'over'? Nothing is over until we decide it is! Was it over when the Germans bombed Pearl Harbor? Hell no! It ain't over now, 'cause when the goin' gets tough, the tough get goin'. Who's with me? Let's go! Come on!...
(returning): What the f--k happened to the crypto I used to know? Where's the spirit? Where's the guts, huh? This could be the greatest night of our lives, but you're gonna let it be the worst. 'Ooh, we're afraid to go with you, crypto, we might get in trouble.' (shouting) Well, just kiss my ass from now on! Not me! I'm not gonna take this. Coinbase, he's a dead man! Celsius, dead! Ethereum...
With TCP/IP, or packet switching, they did have an idea that it will be useful, but noone could imagine how popular it's going to be. With crypto, it seems the opposite, I'm afraid.
Noone needs a use case for a Raspberry Pi, or a Raspberry Pi Pico (the latter, many would say, borders on being useless with other, cheaper and/or more complete platforms being available). But I can just buy one, and tinker with it and voila. I don't need a use case to run a Z80 retro emulator on a Pico, I can just do it on my own, without any "industry" deciding which type of emulators should the investors have.
Why "crypto" needs a use case is exactly because people insist it's money, and had to be acquired with money.
While it was all P2P, and you could get whole bitcoins for fun, it were different times. Nowadays, you can't mine any meaningful amount of it unless you invest in thousands, or you buy them with money or credit card. And it's starting to be either illegal in some countries or in a custodial wallet, going poof when the company goes bankrupt.
Utterly absurd and yet even still seems to make the exact opposite point. 1000 ETH can be sold for over USD1m, if ETH were successful money surely you would be indifferent to receiving $1000 and $1000 worth of ETH. Not to mention this seems to imply everything is ‘money’, I’d swap my phone for an RTX3090 so I guess it’s money too. In some sense maybe but this is so broad that the word ‘money’ ceases to have much use discussing.
This piece is ridiculous. It accuses people who believe there are no use cases of making a bad faith statement while interpreting it in the most literal way possible. They aren’t saying you can’t do anything at all with crypto. Many crypto projects are interesting from a purely technical perspective, but mass market adoption isn’t driven by admiration of a technical implementation.
It presents several technologies most of which have been developed as a crypto version of an existing technology for which a use case exists. In this circumstance the ‘use-case’ sceptics refer to is a feature that dominates the existing products for a price users are willing to pay. For the novel ones it's still unknown, but scepticism here is obviously warranted.
I’m not even wedded to my scepticism of crypto. I have an interest in distributed systems and seeing ways people try to design byzantine fault tolerant systems. But I’m yet to see a project that I would use at all and I semi-regularly look.
Even the final claim to cut out middlemen is false. To the end user transaction fees paid to miners don't feel any different to a fee charged by a bank on a transfer except maybe in magnitude.
edited: said USD instead of ETH
BitTorrent and Tor are interesting and useful but lack mainstream mass market adoption, but these do not make daily rounds on HN front page with dozens of “this technology is good for nothing” comments.
I disagree with the author - ETH might be money-like but it’s use cases are broader than that, and the assets including stablecoins are more like shares or digital gold than state money. To those who use crypto a lot, all of these are just different assets with different uses and degrees of custody, be it fiat or crypto or stocks or physical gold.
> To the end user transaction fees paid to miners don't feel any different to a fee charged by a bank on a transfer except maybe in magnitude.
Part of this is lack of education. In ETH part of each fee is burned, providing value to all ETH holders by reducing supply. In PoS chains, the fees are redistributed to all staking validators - with delegation it means all users can also be, over long time periods, beneficiaries of these protocol fees.
Basically, you over-hype a crypto to your friends, then they invest huge sums of their savings, then immediately a crash occurs, wiping 90% of the saving.
Next use-case is to recommend stables.
Let us know when the laptop sells.
If I need own enough crypto assets as collateral to cover the loan value, whats the point in getting a loan?
No, a centralized database doesn't cut it. Remember how you hate "buying" movies from Google or Amazon only for them to shut down the service down the line? Why would you not hate the same thing for art?
Also, now it's cheap. Just buy some and relax, guys. Let it go.
thats about it. after a year of having some.
The thing is, nobody actually cares if the thing they trust is distributed or not. They just want to not have to trust some specific third parties. They very rarely want their information to be public and immutable.
For example, banks would really like to be able to detect credit card fraud where customers use a cc from bank A to pay off the cc debt in bank B. But they don't want to trust each other, so how do they exchange this data?
Crypto people would instantly jump and say: "Blockchain!"
But what's required here is not distributed ledgers, and certainly not public ledgers. The whole problem is thank bank A doesn't want to give B their customer records. Making it public is worse.
Instead what they do is hire a third-party that's not a bank, like Equifax, Experian, and the like.
These companies hold the ledger centrally, secretly, and don't tell anyone[1] the contents, including bank A or B! Instead, they sell back to the banks the "cc fraud analysis" only, after having done the cross-bank transaction analysis.
There are hundreds, if not thousands of companies like this around the world. I know of several that collect sales information from competing companies and then sell back the anonymized statistics to them. There's basically one for every industry, in every large country.
About 90% of what crypto does can be implemented much more sanely, cheaply, and privately using something like a cloud service.
For example, Azure SQL now has a "Ledger" feature where it keeps cryptographic hashes of transactions in a chain (sound familiar?), and keeps these in immutable blob storage. This blob storage can be restricted to specific private networks. Even if it is public, there is access control based on API keys and the like.
Corporations that need an immutable ledger that "none of them control but all of them can access and verify" can just hire a third-party to spin one of these up and host it in the cloud. Faster, cheaper, simpler, compatible with ordinary SQL applications, and private. That last one can't be underestimated. That's a killer feature that no blockchain can provide without crypto wizardry that only 2 or 3 people on the planet understand.
Ref: https://docs.microsoft.com/en-us/sql/relational-databases/se...
[1] Have you ever wondered why the Equifax data breach affected the records of so many people from so many banks? This is why! Their core business model is cross-bank data collection and analysis.
Everything you can do elsewhere you can do it in Bitcoin, and safer.
