The Rise of Whatever

I keep hearing this theory, that “eventually” we will find the use cases for distributed ledgers, and I don’t buy it. Bitcoin was invented at roughly the same time as the iPhone, and the iPhone immediately found use cases. Right away the global economy reoriented itself around the smartphone, because it demonstrated real value to actual people. We did not need to wait and twiddle our fingers for years going “I think there’s a decent chance people find interesting uses for this someday”.

Immutable distributed ledgers, by contrast, have found no use cases other than crime and financial speculation in coming up on twenty years. Exactly how long do we have to wait for these interesting uses that are “surely” coming?

You make it sounds like it's a struggle between two sides. It's just another option for a creative person who has a problem to solve. Maybe it'll be used for something interesting. Maybe it won't be. It's just a piece of maybe frivolous optional technology.

there are many people with many use cases for distributed ledgers. we are already aware of the flowchart of your argument path

“list them”

“oh I can do that in this other convoluted way that doesnt solve any of these users goals or problems”

“I’m not the target audience for that so it doesnt count”

“ah so financial speculation, that doesnt count despite being the largest application and sector on the planet”

“marketcap doesnt matter and isnt indicative of anything in that economy, I would rather hold digital assets at a separate different standard than every other asset on the planet out of total ignorance that my same arguments apply to asset classes that I respect”

“see I proved my point for myself, there is no use case after 17 years, classic HN”

“those are strawman arguments despite all conversations following this same predictable path enough for any language model to regurgitate it verbatim”

It's clear that financial speculation is a big use for crypto, probably the biggest.

But since almost all the tokens bear neither interest nor dividends, it looks a lot more like a casino.

if you made every incorporated and unincorporated organization and product line and revenue stream to be fractionalized and publicly traded it would look the same

its just a filtering problem

there are screeners to narrow everything down just like for the stock exchanges

A lot of your examples are fallacious arguments that are weak or just generally wrong but your first one is

>”list them”

If you are arguing that something exists, then being asked to prove its existence is table stakes, not poor arguments

You starting with a strong argument in your list of bad arguments and then ending with shit that mocks anyone calling you out makes me believe that you are not discussing this topic in good faith

To quote the article: >> But also… why do you care? Why would someone using a really cool tool that makes them more productive… feel compelled to sneer and get defensive at the mere suggestion that someone else isn’t doing the same?

>> It feels like the same attitude that happened with Bitcoin, the same smug nose-wrinkling contempt. Bitcoin is the future. It’ll replace the dollar by 2020. You’re gonna be left behind. Enjoy being poor. Sure thing, Disco Stu!

unfortunately the same thread has been had for any tangentially crypto thread on HN for the last decade and a half, so it just doesn’t feel like my prerogative to answer such a lazy and abstract question

yes, that means we are at an impasse. use the search, ask an LLM, if even that is too much initiative for a quite outdated skeptic to take even now then I can’t help you

there are hundreds of billions, maybe trillions in volume going through financial services on blockchains and it doesn’t matter if financial services isn’t a sector you care about or are the target audience for, there are people there who will pay to solve problems they have

Evangelists can be ignored if you want, not all promoted use cases are relevant

Its all about blockspace and the commodity that pays for the blockspace

That was true when bitcoin was 2 cents and its true when bitcoin is $109,000 and 2 cents

I mean, are you enjoying your socioeconomic status? the chronology was very clear to some and they were right. It wasn’t luck, it wasn’t a really binary proposition. you can read old threads around the net from 2012 to see exactly where we are going. you can help make that happen or passively act surprised. pretty much every theorized issue can be programmed away, thats what gives people confidence in this asset class compared to others.

Most of the financial services and systems are all still on very boring old databases (hell quite some cobol still touches a ton of it). Since well they don't need to get hype funding for their Series A or whatever. Databases are just pretty good and processing data efficiently. It's a tiny tiny part that actually runs on some blockchain.

Isn't being able of anonymously send you something of value that no one can take away from you a pretty big use case?

A third of the world is unbanked. A permissionless monetary system makes a huge difference for those.

When I was still very skeptical about Bitcoin, I met a guy in Turkey who was from a very poor African country and was just studying there. His father would buy Bitcoin in their home country with the local currency (P2P) and send it to his son, that would then convert it also P2P for Turkish Liras. They could do this securely an within minutes. The alternative was using Western Union and paying taxes in both countries, which in total added up to ~50% of the sent amount.

It's great not needing Bitcoin, as it is great not needing Tor. But that doesn't mean there's no use case for them.

> Its all about blockspace

> That was true when bitcoin was 2 cents

I largely agree with you, but to nitpick: when bitcoin was 2 cents, blockspace was free, and miners regularly accepted zero-fee transactions into blocks. Today, you're not getting a transaction into a block without paying at least a couple hundred sats. Your statement is true today, but it wasn't like this until April-May 2012 when Satoshi Dice started filling blocks up. See Fig 3 on page 9 of <https://maltemoeser.de/paper/transaction-fees.pdf> or look through some early blocks.

there are hundreds of billions, maybe trillions in volume going through financial services on blockchains

and yes that is a tiny fraction of all financial services volume at all, or even involving crypto assets.

I was referring to the traffic onchain as that’s what’s interesting

permissionless liquidity providing in unincorporated partnerships is still novel and unique to those platforms and highly lucrative. on assets that dont need permission to be listed anywhere.

yes, blocks are and were periodically empty

if you expected applications to be deployed that would take up block space when used, and were going to build those applications yourself, then it was still rational

in 2012 people were describing smart contracts, joint custody accounts to secure assets better, and many other applications that are commonplace and have their own critique and discussion now

its like seeing an island full of resources and realizing that the bridges and ferry routes haven't been built yet. that

1) you can get to that island yourself before everyone else

2) you can also build the bridge and put up a toll booth

3) other bridges will be built

4) and other people can also come to the island early at great difficulty too

the same play is still true on other blockchains, and sometimes back again on bitcoin

I’ve done the trade many times over the past 15 years

Today, when blocks are empty, you're paying 1 sat/vB. Back then, when blocks were empty, you paid zero. That's the difference between "all about blockspace" and "only about blockspace when you care about next-block latency".

Here's a 2010 Satoshi post in a thread about transaction fees stating "we should always allow at least some free transactions": https://satoshi.nakamotoinstitute.org/posts/bitcointalk/thre...

If you had said "2 dollars" instead of "2 cents", we would be in complete agreement. All I'm saying is that mandatory transaction fees were not baked in at 2 cents.

and all I’m saying is that it didn’t matter for a bullish thesis whether this is just a nitpick fyi or a nuance you really care about

the only thing that mattered was the malleability of the system to meet its goal of attracting transactions, including the future malleability of what you are pointing out. blockspace became scarce. it was predictable that anything that undermined that would be excised out of the network.