Table of Contents show 1 Research Objectives 2 Methodology 3 The Data We Used 4 Findings: Research Objectives The aim of this research is to shed light on the blockchain industry’s growth and market reach among a vast array of companies. Our specific objectives are: To quantify the number of blockchain and web3 companies that […]
Turns out the one thing Blockchain is good at, building out decentralized strings of commonly agreed upon immutable transactions, is actually not that useful. For small items we need an “undo” button because people make sloppy mistakes or get scammed, for large items we want the government to act as enforcer of the property (house, dollars, car) in question so it doesn’t actually help us to decentralize.
I was originally interested in crypto because I wanted to know how it managed to make truly decentralized, permissionless, peer-to-peer transactions possible. After I learned about how it did all that, I also learned three things:
decentralized transactions are useless when so much of our economy leverages centralized transactions built around existing payment systems.
permissionless transactions are useless when governments are ultimately in control of payments, and have the right to restrict certain payments regardless of how they are made.
peer-to-peer transactions are useless when the currency is in so much investment demand that the price spikes, and nobody wants to spend it because it’s a StOrE oF vAlUe (and because of the tax implications)
So the crypto movement demonstrated it is possible to make a platform to transact on that is free of any reliance on any intermediary, but in practice so much of our existing commerce relies on intermediaries that removing all of them causes more problems.
I honestly think that if the price of Crypto weren’t so darn high, a better ecosystem would have developed around it and it would at least still be useful for payments. But since it is so high, anyone who has any crypto would be nuts to spend it.
Some people hold up the pizzas bought with 10000 BTC as some sort of cautionary tale, because if the guy had held on to the BTC he would have hundreds of millions of dollars right now. But not only was 10000 BTC only worth the price of two pizzas then, nobody back then really knew where the project was going. Certainly no one thought one BTC would ever be worth even $1000 unless BTC transaction adoption really took off. But here we are.
(Plus, I doubt the guy spent his only Bitcoin on pizza for someone else. Someone who had 10K BTC to spare in 2010 likely had a lot more, too. He is probably not eating instant ramen unless he wants to.)
To be fair, there are some services you can get with crypto (I have used those myself), and people (especially Monero community) are promoting a sorta-circular economy with it.
Monero has the additional draw for people who want their transactions really private, not just pseudonymously private. And the fact that some of those private uses may be unseemly I think keeps the VC money out of it. Which is a good thing.
You are much more likely to spend Monero because nobody expects it to get to $1000 or higher unless all of crypto goes up as well. So it is much more likely to get a robust transaction infrastructure.
No, it turns out that a lot of people have jumped on this particular bandwagon and most of it is crap. I’d be surprised if this is much different than the distribution of non-blockchain and non-web3 websites, most of them get very few visitors.
This has nothing to do with blockchain as a technology, but copycats being cheap enough to create that a lot of people create them.
Well, it would be a way for government to gain trust again through proofed transparency after they fucked up. Given the people under that government understand how blockchains work, I guess
But either the government blockchain can get forked/modified by people with enough resources, in which case it’s not reliable, or it is certifiably controlled by the government in which case there’s no point to it being blockchain.
And for donations to Wikileaks, we don’t want the government to be able to reverse or block them. That’s what PayPal did with then before Bitcoin was invented.
I don’t think that Bitcoin can or should replace the current system, but it can be an addition for rarer cases.
But yes: Most of the other blockchain stuff is just completely useless and therefore not used.
Crypto actually is really useful for evading the law, yes, and so it’s good for donating to underground organizations (or to buy drugs or illegal services)
But that’s about the only real use-case as far as I can tell
Well, there are countries like Turkey with a currency that lost 95% of its value during the last 10 years. In such countries, Bitcoin is a way to have a currency that does not have a guarantee to ruin you. When your country has 60% inflation like Turkey, the deflation currency might be seen as a gift. So, this might be a legal use case…
Crypto actually is really useful for evading the law
That’s the only use case I’ve heard that makes sense. To be clear, sometimes it’s moral to break the law, but still…
This came up in an episode of Cartoon Avatars and the specifics were basically, “I’m fleeing from my country and want to bring all my wealth with me over state boundaries without the possibility of it being stolen en route”.
Yes, sometimes it is good to evade the law, because the law might be immoral, for one reason or another, and ranging in severity from not being able to buy weed that helps you, to not being able to flee from a country that might kill you
So there is some legit and morally acceptable use-cases for crypto, but still, it’s not much
I agree that it’s not much. That was my attempt at steel manning crypto’s use case. The single one I know of that makes even a little sense. 99% of it is bullshit.
Turns out the one thing Blockchain is good at, building out decentralized strings of commonly agreed upon immutable transactions, is actually not that useful. For small items we need an “undo” button because people make sloppy mistakes or get scammed, for large items we want the government to act as enforcer of the property (house, dollars, car) in question so it doesn’t actually help us to decentralize.
I was originally interested in crypto because I wanted to know how it managed to make truly decentralized, permissionless, peer-to-peer transactions possible. After I learned about how it did all that, I also learned three things:
decentralized transactions are useless when so much of our economy leverages centralized transactions built around existing payment systems.
permissionless transactions are useless when governments are ultimately in control of payments, and have the right to restrict certain payments regardless of how they are made.
peer-to-peer transactions are useless when the currency is in so much investment demand that the price spikes, and nobody wants to spend it because it’s a StOrE oF vAlUe (and because of the tax implications)
So the crypto movement demonstrated it is possible to make a platform to transact on that is free of any reliance on any intermediary, but in practice so much of our existing commerce relies on intermediaries that removing all of them causes more problems.
The way I view it is that to eliminate that one con, you have to willingly give up on all the pros. Which is a ridiculous proposition in any scenario.
I honestly think that if the price of Crypto weren’t so darn high, a better ecosystem would have developed around it and it would at least still be useful for payments. But since it is so high, anyone who has any crypto would be nuts to spend it.
Some people hold up the pizzas bought with 10000 BTC as some sort of cautionary tale, because if the guy had held on to the BTC he would have hundreds of millions of dollars right now. But not only was 10000 BTC only worth the price of two pizzas then, nobody back then really knew where the project was going. Certainly no one thought one BTC would ever be worth even $1000 unless BTC transaction adoption really took off. But here we are.
(Plus, I doubt the guy spent his only Bitcoin on pizza for someone else. Someone who had 10K BTC to spare in 2010 likely had a lot more, too. He is probably not eating instant ramen unless he wants to.)
To be fair, there are some services you can get with crypto (I have used those myself), and people (especially Monero community) are promoting a sorta-circular economy with it.
Monero has the additional draw for people who want their transactions really private, not just pseudonymously private. And the fact that some of those private uses may be unseemly I think keeps the VC money out of it. Which is a good thing.
You are much more likely to spend Monero because nobody expects it to get to $1000 or higher unless all of crypto goes up as well. So it is much more likely to get a robust transaction infrastructure.
Yes, a point of crypto is to remove the state control that’s been increasing inequality, fueling injustice, destroying the planet, etc.
But no, crypto holders aren’t upset that their holdings are worth so much that they don’t want to spend them.
This is such an astute and accurate description of crypto and mining. You are a textbook example of projection.
No, it turns out that a lot of people have jumped on this particular bandwagon and most of it is crap. I’d be surprised if this is much different than the distribution of non-blockchain and non-web3 websites, most of them get very few visitors.
This has nothing to do with blockchain as a technology, but copycats being cheap enough to create that a lot of people create them.
Well, it would be a way for government to gain trust again through proofed transparency after they fucked up. Given the people under that government understand how blockchains work, I guess
But either the government blockchain can get forked/modified by people with enough resources, in which case it’s not reliable, or it is certifiably controlled by the government in which case there’s no point to it being blockchain.
I don’t think I understand the use case you just described. Can you explain further?
It’s good for certificate revocation lists. But “Web 3.0” was utter bullshit from the start.
I can’t think of one time it was brought up where I couldn’t answer, “I can do the same thing with web 2.0 + federation and/or self-hosting”.
And for donations to Wikileaks, we don’t want the government to be able to reverse or block them. That’s what PayPal did with then before Bitcoin was invented.
I don’t think that Bitcoin can or should replace the current system, but it can be an addition for rarer cases.
But yes: Most of the other blockchain stuff is just completely useless and therefore not used.
Crypto actually is really useful for evading the law, yes, and so it’s good for donating to underground organizations (or to buy drugs or illegal services)
But that’s about the only real use-case as far as I can tell
Well, there are countries like Turkey with a currency that lost 95% of its value during the last 10 years. In such countries, Bitcoin is a way to have a currency that does not have a guarantee to ruin you. When your country has 60% inflation like Turkey, the deflation currency might be seen as a gift. So, this might be a legal use case…
Alternative monetary systems that allow local communities to create elastic money based on trust or assets.
If you can rally a local community behind you, it’s better to look beyond the limitations and negative influences of money
That’s the only use case I’ve heard that makes sense. To be clear, sometimes it’s moral to break the law, but still…
This came up in an episode of Cartoon Avatars and the specifics were basically, “I’m fleeing from my country and want to bring all my wealth with me over state boundaries without the possibility of it being stolen en route”.
Yes, sometimes it is good to evade the law, because the law might be immoral, for one reason or another, and ranging in severity from not being able to buy weed that helps you, to not being able to flee from a country that might kill you
So there is some legit and morally acceptable use-cases for crypto, but still, it’s not much
I agree that it’s not much. That was my attempt at steel manning crypto’s use case. The single one I know of that makes even a little sense. 99% of it is bullshit.