Is Filecoin a $257 million Ponzi scheme? [pdf](github.com)
github.com
Is Filecoin a $257 million Ponzi scheme? [pdf]
https://github.com/backender/filecoin-survey/releases/download/0.5/filecoin_survey.2.pdf
242 comments
Actually, BitTorrent allows you to search specifically for local connections via multicast: http://bittorrent.org/beps/bep_0014.html. With proper prioritization of peers it won't download the data from across the world, if it's present in the same subnet.
Filecoin is trying to solve (paying for) file hosting through IPFS. Many of the existing projects around IPFS are "host X, but on IPFS".
Sure, but these comments that I refer to are discussing on IPFS, not Filecoin directly, and as such seem bizarrely misguided to me.
Saying IPFS is a useless tool because we already have Dropbox and S3 is completely missing the mark. Not only is IPFS not intended to solve "hosting" as a "problem" (in my eyes, at least), but IPFS goals do not even overlap with S3/Dropbox.
Saying IPFS is about hosting because many people use it for that is like saying BitTorrent is for porn because many people use it for that.
Saying IPFS is a useless tool because we already have Dropbox and S3 is completely missing the mark. Not only is IPFS not intended to solve "hosting" as a "problem" (in my eyes, at least), but IPFS goals do not even overlap with S3/Dropbox.
Saying IPFS is about hosting because many people use it for that is like saying BitTorrent is for porn because many people use it for that.
No, it's more generally about hosting any content-addressed data. That's much much more than files/directories, as S3/Dropbox/Sia are doing.
Files and directories are just one particular data structure you can store on IPFS. Think of it as a global unified content-addressed graph database really, and Filecoin can store any arbitrary (sub)graphs within that.
Files and directories are just one particular data structure you can store on IPFS. Think of it as a global unified content-addressed graph database really, and Filecoin can store any arbitrary (sub)graphs within that.
> No, it's more generally about hosting any content-addressed data.
Back to my original points, I don't think it is about hosting the data. It's the location of the data. Eg, a room full of people downloading a large video don't need to leave the room for the majority of the data, they can share the data between each other - seamlessly. Leading to less clogging of the network of data when there's absolutely no need for us to be downloading from youtube/etc.
For me personally, another thing IPFS does is allow access to immutable data. Seeing as websites love to change data on the fly, it's hard to know what someone else saw, compared to what you saw. Was the article modified? Did X political candidate change what s/he's saying on their site? IPFS solves this, and this is my favorite part, tbh.
Back to my original points, I don't think it is about hosting the data. It's the location of the data. Eg, a room full of people downloading a large video don't need to leave the room for the majority of the data, they can share the data between each other - seamlessly. Leading to less clogging of the network of data when there's absolutely no need for us to be downloading from youtube/etc.
For me personally, another thing IPFS does is allow access to immutable data. Seeing as websites love to change data on the fly, it's hard to know what someone else saw, compared to what you saw. Was the article modified? Did X political candidate change what s/he's saying on their site? IPFS solves this, and this is my favorite part, tbh.
> Back to my original points, I don't think it is about hosting the data. It's the location of the data. Eg, a room full of people downloading a large video don't need to leave the room for the majority of the data, they can share the data between each other - seamlessly. Leading to less clogging of the network of data when there's absolutely no need for us to be downloading from youtube/etc.
You're absolutely right here of course
You're absolutely right here of course
Didn't mean to imply you meant otherwise of course - nor was my intent to argue. I just thought it was an important point for anyone (you or otherwise) to read. I thought it came off a little ... wrong, so my apologies for that, if anything was perceived.
Not at all :) There's multiple important points about IPFS and I always forget at least one, so thanks :)
From the paper:
> a total of $257 million – so far the biggest initial coin offering (ICO) as of today (September 2017).
This appears incorrect, as the Sales Summary on https://eosscan.io/ shows EOS having raised over $400 million by September (first 68 days).
> a total of $257 million – so far the biggest initial coin offering (ICO) as of today (September 2017).
This appears incorrect, as the Sales Summary on https://eosscan.io/ shows EOS having raised over $400 million by September (first 68 days).
Good discussion on the technical merits. However, let's take a look at the 'overvalued' claim and a critical error the authors make.
The analysis rests on this ratio calculated for Airbnb: "Airbnb is valued today at approximately $31 billion while holding around 3 million listings in total. The average apartment in the United States was 934 square feet in 2016. In a hypothetical scenario, Airbnb is therefore valued at $11.06 per square feet. If one compares this number to the median price per square foot in the United States, which is $123, the Airbnb ecosystem diminishes the median price by a factor of 11.12."
I get this is back of the envelope so let's ignore the international dimension. The critical error in these calculations is the apples-to-apples comparison of the square feet of an Airbnb listing to a purchased square foot.
Basically - when someone pays $123 per square foot (median price in the U.S.) they are paying for the use of that space for an entire year. Said another way, they are paying $0.34 per day per square foot. Airbnb listings are not in general year-long, which means the same square foot of space is rented out over and over again throughout the year, adding revenues along the way. The 11.12 scaling factor is therefore off and too high. This leads the authors to apply an erroneous scaling factor to the Dropbox sizing to come up with an invalid valuation assessment for Filecoin.
It looks like a good average stay for an Airbnb property is about 5 days (https://blog.atairbnb.com/economic-impact-airbnb/). Let's also assume 50% occupancy rate (https://www.mashvisor.com/blog/what-airbnb-occupancy-rate-ca...).
That means an Airbnb listing is rented out about 37 times a year (365 / 5 days * 50%). The $11.06 per square foot times 37 revenue-generating occasions is $409.22 per square foot ($1.12/day/sq ft v. $0.34/day/sq ft for a purchase). So the correct apples-to-apples comparison here is to say that Airbnb increases the median price of the asset by a factor of 3.32. Aka Filecoin would need to deliver 2,580 petabytes - not 95,185. That's only 5x Dropbox, which is a minnow compared to S3 etc.
Why would that be? Most directly, because Airbnb allows the owners of the asset (sq ft in this case) to ask for a higher per day charge since the length of stay is shorter and thus the owner of the asset has more uncertainty over utilization - it's part of why 30 nights in a hotel costs much more than a month of rent. This is a well-understood economic dynamic and one that would apply to Filecoin storage miners given how miners using Filecoin could theoretically 'rent out' the same gigabyte over and over again to different buyers throughout the year - but also cover the risk of less than 100% annual utilization rates of their fixed-cost asset.
Honestly, reading this article made me more confident in the future of Filecoin. The authors highlight multiple times the better technical features than competition, proven dev team, and unwittingly call out why economically speaking owners of gigabytes under Filecoin could expect a higher return than if you were going to buy the gigabytes yourself for your own use.
Thoughts?
The analysis rests on this ratio calculated for Airbnb: "Airbnb is valued today at approximately $31 billion while holding around 3 million listings in total. The average apartment in the United States was 934 square feet in 2016. In a hypothetical scenario, Airbnb is therefore valued at $11.06 per square feet. If one compares this number to the median price per square foot in the United States, which is $123, the Airbnb ecosystem diminishes the median price by a factor of 11.12."
I get this is back of the envelope so let's ignore the international dimension. The critical error in these calculations is the apples-to-apples comparison of the square feet of an Airbnb listing to a purchased square foot.
Basically - when someone pays $123 per square foot (median price in the U.S.) they are paying for the use of that space for an entire year. Said another way, they are paying $0.34 per day per square foot. Airbnb listings are not in general year-long, which means the same square foot of space is rented out over and over again throughout the year, adding revenues along the way. The 11.12 scaling factor is therefore off and too high. This leads the authors to apply an erroneous scaling factor to the Dropbox sizing to come up with an invalid valuation assessment for Filecoin.
It looks like a good average stay for an Airbnb property is about 5 days (https://blog.atairbnb.com/economic-impact-airbnb/). Let's also assume 50% occupancy rate (https://www.mashvisor.com/blog/what-airbnb-occupancy-rate-ca...).
That means an Airbnb listing is rented out about 37 times a year (365 / 5 days * 50%). The $11.06 per square foot times 37 revenue-generating occasions is $409.22 per square foot ($1.12/day/sq ft v. $0.34/day/sq ft for a purchase). So the correct apples-to-apples comparison here is to say that Airbnb increases the median price of the asset by a factor of 3.32. Aka Filecoin would need to deliver 2,580 petabytes - not 95,185. That's only 5x Dropbox, which is a minnow compared to S3 etc.
Why would that be? Most directly, because Airbnb allows the owners of the asset (sq ft in this case) to ask for a higher per day charge since the length of stay is shorter and thus the owner of the asset has more uncertainty over utilization - it's part of why 30 nights in a hotel costs much more than a month of rent. This is a well-understood economic dynamic and one that would apply to Filecoin storage miners given how miners using Filecoin could theoretically 'rent out' the same gigabyte over and over again to different buyers throughout the year - but also cover the risk of less than 100% annual utilization rates of their fixed-cost asset.
Honestly, reading this article made me more confident in the future of Filecoin. The authors highlight multiple times the better technical features than competition, proven dev team, and unwittingly call out why economically speaking owners of gigabytes under Filecoin could expect a higher return than if you were going to buy the gigabytes yourself for your own use.
Thoughts?
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Filecoin is a huge disappointment to me.
IPFS is fantastic technology, but the main developers getting sidetracked with yet another scammy ICO is the last thing we need.
IPFS is fantastic technology, but the main developers getting sidetracked with yet another scammy ICO is the last thing we need.
Hey, ipfs dev here. The amount of work being done on ipfs has been increasing continually. Work on filecoin is not detracting from ipfs development, and we are bringing on more people for ipfs, libp2p and filecoin.
Just a thought here, but perhaps the ICO wasted them less time than months of meetings trying to raise funds with angels and VCs.
You could say Filecoin is a distraction, but in trying to raise seed money, 50 VCs arranging 100 meetings, 5 verbally committing to you a measly $1M each and negotiate over investment terms while you try to live on ramen, and then 3 out of the 5 backing out in the process, is arguably a MUCH bigger distraction to getting any real work done. It also causes a lot of actual brain rot when you spend that much consecutive time away from tech.
You could say Filecoin is a distraction, but in trying to raise seed money, 50 VCs arranging 100 meetings, 5 verbally committing to you a measly $1M each and negotiate over investment terms while you try to live on ramen, and then 3 out of the 5 backing out in the process, is arguably a MUCH bigger distraction to getting any real work done. It also causes a lot of actual brain rot when you spend that much consecutive time away from tech.
If you think doing traditional fundraising is bad, you should try doing an ICO. Easily 5x worse.
Can you shed some light on this? How are you involved with fundraising via ICO? And how is it so much worse? If anything, I would guess it would be loads easier than traditional fundraising, because so many people seem willing to park their cryptocurrency in various ICOs with pretty much zero due diligence or justification other than it exists.
The legal and PR hurdles you have to go through, but especially the legal hurdles, are a lot more substantial.
That doesn't discount the fact you are involved in yet another ICO. Cryptocurency integration and identity within IPFS could have been done without a new coin. I know you know this, yet you choose to do it anyway. That means we should question your intentions, across all your projects.
And, just for the record, a cryptocurrency fund raise is simply selling access to given private/public key pairs which contain values, like a database. Even hardened by mining, these values and keys are intrinsically worthless until they are used widely for something valuable. It's when convincing someone it's "valuable because you think it is" that it gets "tricky".
And, just for the record, a cryptocurrency fund raise is simply selling access to given private/public key pairs which contain values, like a database. Even hardened by mining, these values and keys are intrinsically worthless until they are used widely for something valuable. It's when convincing someone it's "valuable because you think it is" that it gets "tricky".
> Cryptocurency integration and identity within IPFS could have been done without a new coin
I don't think thats a fair claim to make. There are many attacks on 'pay for distributed storage' that Filecoin addresses. Take a look at [the paper](https://filecoin.io/filecoin.pdf), in particular section 3.1 where we discuss sybil attacks, Outsourcing attacks, and generation attacks. We cover a lot of cases, and build in incentives to continually increase the amount of available storage and push down the price-per-byte. If we thought it was possible to properly incentivize data storage on ipfs without building a blockchain, we would have done so.
I don't think thats a fair claim to make. There are many attacks on 'pay for distributed storage' that Filecoin addresses. Take a look at [the paper](https://filecoin.io/filecoin.pdf), in particular section 3.1 where we discuss sybil attacks, Outsourcing attacks, and generation attacks. We cover a lot of cases, and build in incentives to continually increase the amount of available storage and push down the price-per-byte. If we thought it was possible to properly incentivize data storage on ipfs without building a blockchain, we would have done so.
I don't get all the hatred for ICOs. Nobody is forcing anybody to invest in them, and for something like filecoin there is at least a chance of something extremely useful coming out of it. Many other ICOs seem pretty strange to me, but as long as I am not forced to invest in them, what's the problem?
Can't say so if it is a Ponzi scheme.
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Glad to hear it :)
filecoin taints the crediblity of ipfs by assosiation.
Hey I've been reading a lot of your code in libp2p. Thanks for your amazing contributions to opensource!
Thank you! that means a lot :)
It's interesting to see many of Filecoins promises realized already in alternatives like Sia or Storj, but Filecoin still takes the hype, despite not having anything released, let alone anything superior... I guess because it's by the IPFS developers and had a big flashy ICO?
> I guess because it's by the IPFS developers
And is intended to run on an IPFS network. After reading the replies to this comment, I started looking into Sia, and wanted to try it out, but it seems that I first have to buy some Sia before even being able to become a host (!), which is an instant turnoff.
At the same time, I am already able to try out IPFS and have been able to develop apps using it for quite some time. I am not sure what the plans are with Filecoin, but IPFS also has a default-public (hosting) use case, while as of now Siacoin has private-only.
And is intended to run on an IPFS network. After reading the replies to this comment, I started looking into Sia, and wanted to try it out, but it seems that I first have to buy some Sia before even being able to become a host (!), which is an instant turnoff.
At the same time, I am already able to try out IPFS and have been able to develop apps using it for quite some time. I am not sure what the plans are with Filecoin, but IPFS also has a default-public (hosting) use case, while as of now Siacoin has private-only.
The reason you need to buy some Siacoin in order to become a host is simple - you need collateral in case you fail to fulfill your hosting contracts - collateral of more than the value of those hosting contacts themselves. Turn off or not, that seems to be the only reasonable way to achieve private hosting contracts to me
Sure, I realize that it is for collateral. Nonetheless, that is why I spend my time doing stuff with IPFS rather than Siacoin.
I tried to answer your question about why people are hyped for IPFS/Filecoin (some only for one of the two) rather than the alternatives. It is not only because IPFS/Filecoin are "flashy", but because contrary to your claim developers _did_ have something working to play with from the same developers for quite some time which is also superior in some regards (public hosting).
I tried to answer your question about why people are hyped for IPFS/Filecoin (some only for one of the two) rather than the alternatives. It is not only because IPFS/Filecoin are "flashy", but because contrary to your claim developers _did_ have something working to play with from the same developers for quite some time which is also superior in some regards (public hosting).
If you just want enough siacoin to become a host I can probably send some over. I already have some and haven't gotten around to hosting yet.
Thanks for the offer, but from what I've read over the last hours I'm not really too eager to try it out anymore.
Fair enough, I'd like to hear what you think/read if you'd like to share.
The Sia team has really impressed me with their approach. They're the type of devs that keep quiet and just get the work done. No hype, no grandiose promises, just hard work and solving hard problems. I think that in the end they'll be the ones that come out ahead when it comes to decentralized storage.
Hey, Sia core dev here.
From the beginning, we've prided ourselves writing code instead of pushing PR pieces and designing flashy websites. So I'm glad that you (and others) picked up on those values. By keeping our heads down, we've built the only truly distributed and decentralized marketplace for storage, and we did it with a team and a budget far smaller than our competitors.
Thanks for your support -- posts like this motivate me more than almost anything else.
From the beginning, we've prided ourselves writing code instead of pushing PR pieces and designing flashy websites. So I'm glad that you (and others) picked up on those values. By keeping our heads down, we've built the only truly distributed and decentralized marketplace for storage, and we did it with a team and a budget far smaller than our competitors.
Thanks for your support -- posts like this motivate me more than almost anything else.
Hi, Tribler dev here. awesome to see everybody here.. Do Sia and Filecoin take into account the "oversupply problem"? Filecoin devs nicely explain their sybil-attack strategy with growing your identity. However, how can you earn credits if nobody likes you and you happen to have a low-performance node?
Is this a real problem or are we missing something? For details, see our journal article on a macroeconomic sharing model from 2012, https://github.com/Tribler/tribler/files/1517977/Meulpolder_...
Hey, great question!
(i am filecoin/ipfs/etc employee)
I am going to give some definitions (please chip in case of my misunderstanding) - “nobody likes you”: reputation is not central to Filecoin, so I guess you cannot be “not liked”. Whether you are trusted or not, the clients will pay you only if you have provided a proof of having offered a service. Note: Filecoin has pseudonyms, if for some reasons your address is not liked, you can create a new Filecoin address. So every “not liked” case eventually reduces to being a new user. TL;DR I will assume you mean “a new user”. - “low-performance node”: Filecoin does not require special hardware, but off-the-shelf CPUs, and whether you have 1 or 1000, it should not matter in practice (all the operations are sequential). I wouldn’t consider the amount of storage as “performance”, your node can always participate as a small miner. If by low performance you mean faulty hardware, then you are really not contributing to the network. So I am going to consider “low-performance” to mean slow network connection.
Now, if you are a new node without much track record and with a bad internet connection, you could: - participate as a Storage Miner in the Storage Market (your job will be mainly storing the file and generate proofs offline that you have stored the file, you will need just enough internet connection to be updated with the head of the chain) and every now and then (even with a bad network connection), submit the proofs to the chain. In addition, if you are happy listening to new transactions and have enough storage (unless you consider yourself REALLY lucky), then you can participate to mining Filecoin and earn tokens from transaction fees and mining rewards. My strategy would be to start with lower prices than the rest of the network, if you are also mining, block reward could cover for your lower prices - participate as a Retrieval Miner, you might not be that successful in comparison to fast speed super connected nodes that have incredible amount of storage, BUT you could try to store and serve “rare” files or serve to nodes that are closer to you (since you could become their node of preference)
I took advantage to explain my reasoning so that others could find this helpful too :) I will take a look at the paper, thanks for sharing, there is a lot the community can learn from the first wave of p2p file sharing.
I am going to give some definitions (please chip in case of my misunderstanding) - “nobody likes you”: reputation is not central to Filecoin, so I guess you cannot be “not liked”. Whether you are trusted or not, the clients will pay you only if you have provided a proof of having offered a service. Note: Filecoin has pseudonyms, if for some reasons your address is not liked, you can create a new Filecoin address. So every “not liked” case eventually reduces to being a new user. TL;DR I will assume you mean “a new user”. - “low-performance node”: Filecoin does not require special hardware, but off-the-shelf CPUs, and whether you have 1 or 1000, it should not matter in practice (all the operations are sequential). I wouldn’t consider the amount of storage as “performance”, your node can always participate as a small miner. If by low performance you mean faulty hardware, then you are really not contributing to the network. So I am going to consider “low-performance” to mean slow network connection.
Now, if you are a new node without much track record and with a bad internet connection, you could: - participate as a Storage Miner in the Storage Market (your job will be mainly storing the file and generate proofs offline that you have stored the file, you will need just enough internet connection to be updated with the head of the chain) and every now and then (even with a bad network connection), submit the proofs to the chain. In addition, if you are happy listening to new transactions and have enough storage (unless you consider yourself REALLY lucky), then you can participate to mining Filecoin and earn tokens from transaction fees and mining rewards. My strategy would be to start with lower prices than the rest of the network, if you are also mining, block reward could cover for your lower prices - participate as a Retrieval Miner, you might not be that successful in comparison to fast speed super connected nodes that have incredible amount of storage, BUT you could try to store and serve “rare” files or serve to nodes that are closer to you (since you could become their node of preference)
I took advantage to explain my reasoning so that others could find this helpful too :) I will take a look at the paper, thanks for sharing, there is a lot the community can learn from the first wave of p2p file sharing.
Fascinating in-depth answer. thnx!
> clients will pay you only if you have provided a proof of having offered a service.
Sounds like a good approach. You need to make trade-offs in your design for storage providers I believe. You can bias clients to deal with and pay reliable plus fast providers. That means slow peers have less chance to earn coins. Or take a performance hit and use fairness as a guiding principle. Then slow or new users get selected with increased probability. True?
> you could try to store and serve “rare” files
Has your team done work on 'investment functions' to select which "rare" files to store? You want to be paid, so what is incentive compatible? For a few years our phd/master students have been struggling to get a high-performance algorithm: https://github.com/Tribler/tribler/issues/1842#issuecomment-...
> clients will pay you only if you have provided a proof of having offered a service.
Sounds like a good approach. You need to make trade-offs in your design for storage providers I believe. You can bias clients to deal with and pay reliable plus fast providers. That means slow peers have less chance to earn coins. Or take a performance hit and use fairness as a guiding principle. Then slow or new users get selected with increased probability. True?
> you could try to store and serve “rare” files
Has your team done work on 'investment functions' to select which "rare" files to store? You want to be paid, so what is incentive compatible? For a few years our phd/master students have been struggling to get a high-performance algorithm: https://github.com/Tribler/tribler/issues/1842#issuecomment-...
Sooner or later (i.e. before Filecoin ships) you do need to turn on the marketing so that people will use what you built.
You're making me want to actually try Sia for real stuff.
I like them because they're really trying to solve the problems around decentralized storage. Storage will be a very valuable resource for a long time to come, so anyone who can make it cheap and make it work well will have solved a valuable problem. Take a look at the companies that have invested money in them (Google is one), and you'll see that they have strong interest in what the team is doing. And I'm not talking about millions, but more like normal investment money to fund hiring of people. Here's an article about them:
https://www.bostonglobe.com/business/2017/08/07/sia/sUZ0p3EE...
https://www.bostonglobe.com/business/2017/08/07/sia/sUZ0p3EE...
I see two drawbacks to the technology:
1) data storage with trusted centrally controlled infrastructure will always be cheaper (probably much cheaper) because you need far more redundancy in an untrusted network and the centralized infrastructure has superior economies of scale.
2) Your (encrypted) data is public so you are relying on the platform having zero exploitable bugs ever, which is just not a smart assumption. For this reason alone I can't really see any serious person being willing to store their data on this network.
1) data storage with trusted centrally controlled infrastructure will always be cheaper (probably much cheaper) because you need far more redundancy in an untrusted network and the centralized infrastructure has superior economies of scale.
2) Your (encrypted) data is public so you are relying on the platform having zero exploitable bugs ever, which is just not a smart assumption. For this reason alone I can't really see any serious person being willing to store their data on this network.
Sia addresses both of these.
1) You have full control over which hosts you store data on; if Amazon makes their data centers available on Sia, you can choose to store at 1x redundancy with them. I will note, though, that erasure coding can get you many nines of reliability at fairly low redundancy, as long as the hosts aren't completely flaky. And you can do even better if you actively replace hosts as soon as they go offline.
2) The only thing you need to trust here is the client-side encryption code, which is fairly straightforward. And if you're really paranoid, nothing prevents you from using your own encryption scheme instead of our default one.
Disclaimer: I am a Sia core dev.
1) You have full control over which hosts you store data on; if Amazon makes their data centers available on Sia, you can choose to store at 1x redundancy with them. I will note, though, that erasure coding can get you many nines of reliability at fairly low redundancy, as long as the hosts aren't completely flaky. And you can do even better if you actively replace hosts as soon as they go offline.
2) The only thing you need to trust here is the client-side encryption code, which is fairly straightforward. And if you're really paranoid, nothing prevents you from using your own encryption scheme instead of our default one.
Disclaimer: I am a Sia core dev.
Hey, ipfs dev here.
In filecoin (as in sia, and most other decentralized storage networks) the client who is storing data has control over who stores their data. It's a market. So for example, if a well known company decides to offer storage through filecoin, they can publicly attest to their miner IDs, and you can choose to make deals with them for data storage (even at a slightly higher price if they want to charge it).
Separately, we are working on schemes to allow miners to only serve a clients data in situations they approve of (authorization/authentication). This would address the problem of the data being 'public'. If you can control who stores your data and who can access it, it has the same attack surface as any traditional cloud storage provider.
In filecoin (as in sia, and most other decentralized storage networks) the client who is storing data has control over who stores their data. It's a market. So for example, if a well known company decides to offer storage through filecoin, they can publicly attest to their miner IDs, and you can choose to make deals with them for data storage (even at a slightly higher price if they want to charge it).
Separately, we are working on schemes to allow miners to only serve a clients data in situations they approve of (authorization/authentication). This would address the problem of the data being 'public'. If you can control who stores your data and who can access it, it has the same attack surface as any traditional cloud storage provider.
But if the user is only going to use trusted counter-parties to store their data then why use the distributed protocol at all? What additional functionality does it add besides just picking a provider like AWS or GCE and putting your data there directly?
(1) Is true. For data worth less than the risk of your cloud vendor doing something you don't like with it, well, economics, as always, applies.
For (2), there's nothing preventing nested encryption, if your threat model dictates.
For (2), there's nothing preventing nested encryption, if your threat model dictates.
Nested encryption doesn't change anything. The nested encryption scheme would have to be perfect as well, which is also a bad assumption.
Even if you assume your crypto scheme is perfect you are still giving adversaries unlimited access to brute force your key.
For security conscious parties (corp, gov, mostly) encryption is a failsafe when other layers of physical security fail. No one is trusting encryption to be their sole means of securing their data.
Not to mention that if you put data on an untrusted system you lose the ability to track break attempts and detect breaches if they do occur.
Even if you assume your crypto scheme is perfect you are still giving adversaries unlimited access to brute force your key.
For security conscious parties (corp, gov, mostly) encryption is a failsafe when other layers of physical security fail. No one is trusting encryption to be their sole means of securing their data.
Not to mention that if you put data on an untrusted system you lose the ability to track break attempts and detect breaches if they do occur.
> The nested encryption scheme would have to be perfect as well, which is also a bad assumption.
If that is true for your security model, then encryption is always pointless for you[1]. Later on, you mention "security conscious" parties, which means you understand that security is a cost gradient, meaning one size doesn't fit all, and less-than-perfect assurance has value in some contexts.
Do I think the DoD is going to move all their storage to this? That would be idiotic. Do I think there is an achievable scheme like this that is "good enough" for a variety of use cases? I think the answer is pretty clearly yes; the difficulties of actually realizing it are elsewhere.
[1] Yes, OTPs exist. They don't count.
If that is true for your security model, then encryption is always pointless for you[1]. Later on, you mention "security conscious" parties, which means you understand that security is a cost gradient, meaning one size doesn't fit all, and less-than-perfect assurance has value in some contexts.
Do I think the DoD is going to move all their storage to this? That would be idiotic. Do I think there is an achievable scheme like this that is "good enough" for a variety of use cases? I think the answer is pretty clearly yes; the difficulties of actually realizing it are elsewhere.
[1] Yes, OTPs exist. They don't count.
> If that is true for your security model, then encryption is always pointless for you
I don't think that is true.
If your first line of defense is physical security that doesn't mean you don't use crypto. The person who can break your physical security can't necessarily break your crypto. Even if the crypto isn't perfect it may be good enough.
The point is that no one in the real world relies on crypto only. Everyone has a physical security layer and then crypto. That is just a fact of how corp, gov, and concerned individuals manage their data.
A distributed network with untrusted peers would radically change the accepted security model and in a way that I don't think any qualified decision maker would accept.
So maybe you can get consumers to use the network for the same thing they use Backblaze for, but Backblaze is already hella cheap, and I am pretty sure the distributed network will be more expensive, so where is the value prop to the people who don't care or aren't knowledgable about security?
I don't think that is true.
If your first line of defense is physical security that doesn't mean you don't use crypto. The person who can break your physical security can't necessarily break your crypto. Even if the crypto isn't perfect it may be good enough.
The point is that no one in the real world relies on crypto only. Everyone has a physical security layer and then crypto. That is just a fact of how corp, gov, and concerned individuals manage their data.
A distributed network with untrusted peers would radically change the accepted security model and in a way that I don't think any qualified decision maker would accept.
So maybe you can get consumers to use the network for the same thing they use Backblaze for, but Backblaze is already hella cheap, and I am pretty sure the distributed network will be more expensive, so where is the value prop to the people who don't care or aren't knowledgable about security?
I think we have some conversational difficulties (using words differently, perhaps different understandings of what's going on) that is making it hard to have a decent discussion, so I'm going to conclude with where I think we agree.
Some system roughly like this has potential use cases, even if it may be unsuitable for others. While I wouldn't expect a public company to store their financials in it, there is a lot of data that is held less tightly out there.
And more speculatively, "The street finds its own uses for things." Who knows what obvious-in-restrospect thing emerges. Maybe after 10 years and some evolution, commercial software and data systems live in a system like this and purchases are ledger operations, so the user-base of a given product becomes the distribution platform.
Some system roughly like this has potential use cases, even if it may be unsuitable for others. While I wouldn't expect a public company to store their financials in it, there is a lot of data that is held less tightly out there.
And more speculatively, "The street finds its own uses for things." Who knows what obvious-in-restrospect thing emerges. Maybe after 10 years and some evolution, commercial software and data systems live in a system like this and purchases are ledger operations, so the user-base of a given product becomes the distribution platform.
Filecoin ICO was when I lost interest in IPFS because I realised its developers were not as like-minded to me as I had hoped.
Well, yeah.
They saw dollar signs and got bit by the ICO bug. Truth be told, I still like the idea of Filecoin as a method to get around the problem of Tragedy of the Commons.
But overvalued and overhyped indeed.
They saw dollar signs and got bit by the ICO bug. Truth be told, I still like the idea of Filecoin as a method to get around the problem of Tragedy of the Commons.
But overvalued and overhyped indeed.
There's only so many different ways of funding open source software development, and we selected one that wouldn't have us struggle for grants or VC money every other year. The funding of open source infrastructure is a huge problem. @jbenet did a great in-depth podcast with YC: https://blog.ycombinator.com/ipfs-coinlist-and-the-filecoin-... (transcript included)
But you can't help if others put a high value on it. It's kind of the definition of the market that others put a value on it.
If anything, you did the ICO the "right" way, even if I didn't like the fact that you excluded it to official investors. But that's an issue with the SEC laws as the way they're written - not you or jbenet.
My biggest hope is that you all continue working on both, IPFS core, and Filecoin. And secondarily, reduce memory footprint with IPFS itself. It's still gobbley - cause I'd like to be able to get a /bt/mac/ node available for serving locally via BTLE.
If anything, you did the ICO the "right" way, even if I didn't like the fact that you excluded it to official investors. But that's an issue with the SEC laws as the way they're written - not you or jbenet.
My biggest hope is that you all continue working on both, IPFS core, and Filecoin. And secondarily, reduce memory footprint with IPFS itself. It's still gobbley - cause I'd like to be able to get a /bt/mac/ node available for serving locally via BTLE.
Something like Filecoin is necessary to make IPFS what it could become, I recognize there are huge unsolved problems with it but it's not legitimately so that they can't be solved. It's worth a shot and sophisticated private investors took bets on this with eyes wide open, followed by the public of course which many consider problematic (I don't).
There are complaints about the discounts private investors got etc but at the end of the day I'm glad this is research getting funded and I think calling it a scam is straight up wrong. We'll see I guess.
There are complaints about the discounts private investors got etc but at the end of the day I'm glad this is research getting funded and I think calling it a scam is straight up wrong. We'll see I guess.
> sophisticated private investors took bets on this with eyes wide open
Bullshit.
Bullshit.
So you're saying that Sequoia Capital, Andreessen Horowitz, Union Square Ventures, and Winklevoss Capital didn't know what they were getting into?
Yeah exactly. Anyone who has engaged with the protocol knows there are huge unknowns - they're acknowledged in the whitepaper. They have theoretical solutions which are often discussed in public on Github and Gitter, and they've gotten past many large hurdles already as a team. I think there's a chance.
Importantly, if Filecoin were usable right now to guarantee storage and retrievability of files, I have use cases I'd use that for right this second.
Importantly, if Filecoin were usable right now to guarantee storage and retrievability of files, I have use cases I'd use that for right this second.
I'm not understanding how this is categorically different than your standard VC deal.
It's a little different I guess since the public invested too. I think that's a good thing though but I may regret this comment if crypto (specifically Filecoin) goes totally sideways. The public should be allowed to take risks though!
The public did invest under the same rules as a standard VC deal, i.e. Reg D. Though I guess with additional accredited investor verification on account of the general solicitation rules, which don't typically apply in VC deals.
> The public should be allowed to take risks though!
I have complex feelings about this. For example, I wanted to participate in the Filecoin ICO, and I could not because I don't meet the accredited investor requirements. On the micro level, I was a bit disappointed. It's my money, if I want to give it to a charlatan, I should be able to. On the macro level, I understand that it makes sense that most people like me shouldn't be investing in companies that aren't required to make any disclosures, financials or otherwise, particularly when people like me aren't really in a position to negotiate for that information. In my mind, protecting mom and pop is still a worthwhile goal.
So while I definitely agree that the public should be allowed to take risks, it's relevant that there are quite a few markets that they have unimpeded access to. And I'm generally sympathetic to the SEC's desire to shield the least sophisticated investors from the riskiest investments.
> The public should be allowed to take risks though!
I have complex feelings about this. For example, I wanted to participate in the Filecoin ICO, and I could not because I don't meet the accredited investor requirements. On the micro level, I was a bit disappointed. It's my money, if I want to give it to a charlatan, I should be able to. On the macro level, I understand that it makes sense that most people like me shouldn't be investing in companies that aren't required to make any disclosures, financials or otherwise, particularly when people like me aren't really in a position to negotiate for that information. In my mind, protecting mom and pop is still a worthwhile goal.
So while I definitely agree that the public should be allowed to take risks, it's relevant that there are quite a few markets that they have unimpeded access to. And I'm generally sympathetic to the SEC's desire to shield the least sophisticated investors from the riskiest investments.
I am using ipfs at work for something unrelated to filecoin. From our experience in the last months, the speed of ipfs development and the responsiveness of the developers has picked up markedly since the filecoin ICO.
Since filecoin is going to be built on top of ipfs, there is a pretty big incentive to make it solid.
Since filecoin is going to be built on top of ipfs, there is a pretty big incentive to make it solid.
edit: Weird, I thought I was commenting on another thread, about Nobel laureates criticizing Bitcoin. I saw it on my phone, then opened HN at my notebook to comment. I misread the title and commented here, but now I can't find the correct thread (was it flagged?).
I am growing this idea that Bitcoin (and any cryptocurrency that is affected by aggressive price growth) is an anti-fragile indirect multilevel marketing scheme, the "diamond" of the digital era.
It is anti-fragile because it does not have a single point of failure, it is decentralized, its creators are unknown, it is adaptable to several use cases. So each attack on Bitcoin (be it exchange hacking, scams or celebrities' critics) that doesn't kill it, make it stronger.
It is a multilevel marketing scheme because it is mostly a zero-sum game, all earnings of bitcoin owners come from new money entering the game. It is indirect because the ones that are most fervourous advertising and defending bitcoin are holding it, not selling.
I believe it is the diamond of the new era because of some key similarities:
Both BTC and Diamond:
- Its original bump in value come from a marketing campaign (even if with Diamond it was centralized and offline, and with BTC is decentralized and viral)
- Its scarcity is artificially controlled
- Its main use case is black market commerce (for one side of the argument) or money laundry (for the other side).
For BTC owners the good news is that the "diamond bubble" it is still strong decades (centuries?) after its modern boom. The bad news is that Diamond was able to correlate to status, a strong (if subjective) value that is part of humanity since always. BTC only appeal is its value as money, so bubbly reinforcements (up and down) apply.
I am growing this idea that Bitcoin (and any cryptocurrency that is affected by aggressive price growth) is an anti-fragile indirect multilevel marketing scheme, the "diamond" of the digital era.
It is anti-fragile because it does not have a single point of failure, it is decentralized, its creators are unknown, it is adaptable to several use cases. So each attack on Bitcoin (be it exchange hacking, scams or celebrities' critics) that doesn't kill it, make it stronger.
It is a multilevel marketing scheme because it is mostly a zero-sum game, all earnings of bitcoin owners come from new money entering the game. It is indirect because the ones that are most fervourous advertising and defending bitcoin are holding it, not selling.
I believe it is the diamond of the new era because of some key similarities:
Both BTC and Diamond:
- Its original bump in value come from a marketing campaign (even if with Diamond it was centralized and offline, and with BTC is decentralized and viral)
- Its scarcity is artificially controlled
- Its main use case is black market commerce (for one side of the argument) or money laundry (for the other side).
For BTC owners the good news is that the "diamond bubble" it is still strong decades (centuries?) after its modern boom. The bad news is that Diamond was able to correlate to status, a strong (if subjective) value that is part of humanity since always. BTC only appeal is its value as money, so bubbly reinforcements (up and down) apply.
The bad news is that Diamond was able to correlate to status, a strong (if subjective) value that is part of humanity since always. BTC only appeal is its value as money ...
Startup idea: Bitcoin wedding rings.
A beautiful gold ring with a private key engraved on the inside. Give your loved one the gift of BTC! Your commitment to each other, eternalized on the global blockchain.
Gentlemen may prefer blondes, but the modern woman prefers Bitcoin to carats of squeezed carbon. Status, store of value, it's all there.
(This is satire, but now I'm worried it will actually happen if the coinmania doesn't subside soon.)
Startup idea: Bitcoin wedding rings.
A beautiful gold ring with a private key engraved on the inside. Give your loved one the gift of BTC! Your commitment to each other, eternalized on the global blockchain.
Gentlemen may prefer blondes, but the modern woman prefers Bitcoin to carats of squeezed carbon. Status, store of value, it's all there.
(This is satire, but now I'm worried it will actually happen if the coinmania doesn't subside soon.)
Where I come from your nickname would soon be "4-fingers"
Same risk with a $10k diamond ring, right? Yet people buy those from Tiffany's.
Doesn't a diamond ring lose value once it is sold, though, in terms of re-sell value? A ring worth one bitcoin is not going to lose value once it is sold (aside from market volatility).
Yeah, but it's business as usual for petty thieves to cause 10x (or 100x, or 1000x) damage for a 1x payoff.
1000× times the diminutive likelihood that this nicely immutable paper wallet hasn't already been spent.
(A paper wallet is a paper wallet even if it is written on gold in tengwar runes that only appear when subjected to fire)
(A paper wallet is a paper wallet even if it is written on gold in tengwar runes that only appear when subjected to fire)
Yes, a diamond ring cannot be resold, since the price of diamonds has been decoupled from the difficulty of getting them. You're not paying that jeweler for the diamond on the ring; you're paying him a special fee for being a De Beers recognized diamond merchant. A bitcoin doesn't have that problem.
However, a ring inscribed with a private key controlling one bitcoin will lose its value immediately, because whoever comes into possession of (or ever sees) the ring will move the bitcoin.
However, a ring inscribed with a private key controlling one bitcoin will lose its value immediately, because whoever comes into possession of (or ever sees) the ring will move the bitcoin.
Shrem wears a ring engraved with the code that gives him access to the Bitcoin "wallet" on his computer.
"They started calling me four-finger Charlie“
http://www.businessinsider.com/charlie-shrem-arrested-bitcoi...
"They started calling me four-finger Charlie“
http://www.businessinsider.com/charlie-shrem-arrested-bitcoi...
Is that also true for diamond ring wearers?
Just watched a movie on Netflix yesterday called Bitcoin Heist.
A B-grade fictional movie focused around "Ghost" who has the QR code to his wallet on his ring. Worth a watch if you're sick in bed.
Fun anecdote: the movie is depicted when $BTC is $250 and they're chasing after 30k and 40k bitcoin.
A B-grade fictional movie focused around "Ghost" who has the QR code to his wallet on his ring. Worth a watch if you're sick in bed.
Fun anecdote: the movie is depicted when $BTC is $250 and they're chasing after 30k and 40k bitcoin.
I think that jewelry should have a property of showing off, so hidden private key wouldn't work that well. You need to have some mechanism how to show status. And that nicety factor was driven mostly by women decorum.
Simple, have an embedded device in the ring with a tiny display that gets and displays the real time value of the wallet.
That's just a question of recognizable design and enough marketing spend, i.e. branding.
It's well known that people pay a major premium for things solely because they have words printed on them like "Calvin Klein", "Guess?" or "YSL". Jewelry branding is actually easier to make visually recognizable than clothes.
It's well known that people pay a major premium for things solely because they have words printed on them like "Calvin Klein", "Guess?" or "YSL". Jewelry branding is actually easier to make visually recognizable than clothes.
People don't pay a premium for the label, they pay a premium for the middlemen who host the label, because that is a presumably exclusive group and culture that they have access to.
Well you can easily sign stuff with your key and people can easily verify how much coin is in the account.
I predict at some point we’ll see a rap music video where they “make it rain” QR codes of high value Bitcoin addresses.
You could make it able to sign transactions from the account with something like a Java ring: https://www.javaworld.com/article/2076641/learn-java/an-intr...
Though for a wedding ring you'd clearly need a different look.
Though for a wedding ring you'd clearly need a different look.
The problem is how do you get the private key engraved without sharing it with the jeweler or whoever?
I had this idea a few weeks ago. I think it would sell, but how do you tie the ring to the bitcoin effectively?
Engrave the key on the inside of the ring.
The key is information. One glance at it, by the wrong person, and it becomes worthless.
Then you can't get your ring professionally cleaned.
Love the idea...;-)
For Christmas, I'm giving books and I'll write a paper wallet seed in a page with some BTC in it already.
I agree with everything you say, except the idea that it is zero-sum. It is very nonzero-sum insofar as the bulk of the purported value of the system derived from revaluation and windfall: much of the $158 billion market cap of bitcoin derives not from outright transactions at market value (and thus conversion of assets from one form to another with face-value liquidity) but from revaluation of coins purchased at lower prices or mined out of thin air (or rather electricity). This means that the market has ballooned in value (as do speculative bubbles... not stating outright that this is a bubble, but analogously) and has benefitted all asset-holders super-linearly, but it also puts them all at immense risk of devaluation (which would be sub-proportional). This nonlinearity in the risk profile is a direct result of its nonzero-sumness.
As for it being anti-fragile... meh... that’s to be ascertained. For sure so past it has benefited from volatility, but in the relatively short-term many things do. Only the long term will tell whether it will regress to the mean or not, and only a bunch of ’real’ crashes (massive liquidity events, as opposed to strong fluctuations in value with limited trade volumes) will tell us empirically what that ”long term” timeframe is.
(Yup, finance’s a pain for anybody trying to predict the future.)
As for it being anti-fragile... meh... that’s to be ascertained. For sure so past it has benefited from volatility, but in the relatively short-term many things do. Only the long term will tell whether it will regress to the mean or not, and only a bunch of ’real’ crashes (massive liquidity events, as opposed to strong fluctuations in value with limited trade volumes) will tell us empirically what that ”long term” timeframe is.
(Yup, finance’s a pain for anybody trying to predict the future.)
Should we say instead that it has benefit all sellers, no benefit simply for holding? That misappropriation or mischaracterization will of course comfort everyone holding - until everyone tries to liquidate too quickly or investor money runs out.
The scary part is that because it is global and decentralized, it could take a long time for investor money to run out - allowing enough time for manipulation through marketing et al to bring this more and more mainstream, potentially forcing the unreasonable wealth transfer weighted towards the earlier adopters; simply the idea of lobbying and bribing politicians is enough to understand how society could be forced to adopt crypto-assets that are incentivized this way. The solution, if blockchain's core values end up being legitimate, is to have the State/government require its use, in a version that has a fixed price or at least not incentivized in the way that the most popular brands are - Bitcoin, Ethereum's Ether, etc.
The scary part is that because it is global and decentralized, it could take a long time for investor money to run out - allowing enough time for manipulation through marketing et al to bring this more and more mainstream, potentially forcing the unreasonable wealth transfer weighted towards the earlier adopters; simply the idea of lobbying and bribing politicians is enough to understand how society could be forced to adopt crypto-assets that are incentivized this way. The solution, if blockchain's core values end up being legitimate, is to have the State/government require its use, in a version that has a fixed price or at least not incentivized in the way that the most popular brands are - Bitcoin, Ethereum's Ether, etc.
As an economist, I am much more comfortable with that statement
It is somewhat a worse situation than you describe, as though bitcoin is legal tender nowhere, it is assuming many of the features of a component of broad money supply (somewhere in the neighbourhood of M3 or thereabouts, so it can self-perpetuate for a long time indeed).
Also, as a consequence of its construction and finite supply of bitcoins, it does not allow elastic creation of money (no lending, only coining) when the need arises, so it has all the components of a catastrophic liquidity crisis: no underlying value, shallow capitalisation, no ability to adjust supply in the short term, fixed long term amount, and speculation run riot. This could be terrible.
I’m fairly sure blockchain technology will eventually be appropriated by central banks and governments and integrated into the financial system (”biteuro”?) but until the , I’m staying away from it.
It is somewhat a worse situation than you describe, as though bitcoin is legal tender nowhere, it is assuming many of the features of a component of broad money supply (somewhere in the neighbourhood of M3 or thereabouts, so it can self-perpetuate for a long time indeed).
Also, as a consequence of its construction and finite supply of bitcoins, it does not allow elastic creation of money (no lending, only coining) when the need arises, so it has all the components of a catastrophic liquidity crisis: no underlying value, shallow capitalisation, no ability to adjust supply in the short term, fixed long term amount, and speculation run riot. This could be terrible.
I’m fairly sure blockchain technology will eventually be appropriated by central banks and governments and integrated into the financial system (”biteuro”?) but until the , I’m staying away from it.
Just a few days ago the thought came to me that a government mandated crypto-currency in Canada might be well-named as the Loonie.
Also, I am wondering how hard it would be to create a model - interactive online - that has different models of comparing a Ponzi scheme scale operation vs. a Bitcoin-like operation.. Is there software or online platforms for economists to run these kinds of analysis?
Also, I am wondering how hard it would be to create a model - interactive online - that has different models of comparing a Ponzi scheme scale operation vs. a Bitcoin-like operation.. Is there software or online platforms for economists to run these kinds of analysis?
I'm not aware of an index of “ponziness”, but I'm equally pretty sure somebody must've defined a bunch of them and that they can probably be calculated. I just can't think of set of keywords that would allow to search for them in the literature.
Hi Qubex, I appreciate your thinking here.
I’m fascinated by the topics of economics and currency controls here and would would love to discuss some of these issues with you (relevant to a current project).
Can we email? My contact is in my bio.
I’m fascinated by the topics of economics and currency controls here and would would love to discuss some of these issues with you (relevant to a current project).
Can we email? My contact is in my bio.
I sent you an email as you requested.
I wish to remark however that mine is a purely doctrinarian point of view, argued from first principles, and that bitcoin is by no means my field of expertise. I'm just looking at is as any neoliberal/monetarist financial economist (with a passion for market failures and the study of disequilibria) would.
To coin an analogy (pardon the pun): I'm like a chemist telling people about how dangerous plutonium is, purely on the basis of its chemical reactivity and toxicity, blissfully ignorant of its transcendent physical reactivity and fissile potential.
Within the window of that proviso, and assuming I have more to say on the topic (it might surprise you, but I'm not terribly interested in bitcoin, and don't bother to stay up to date on it beyond the occasional sensationalistic news that filters through Bloomberg and international media), I'm always eager to have a rational, measured conversation even between people that disagree. I'm not a bitcoin guru, I'm not an active equities, commodities, or derivatives analyst or investor, and I concern myself with the comparatively mundane task of running a family business that has blossomed into a multinational corporation. Despite what my written English may belay I'm not even an Anglo-Saxon, so I couldn’t declare myself to be entirely up-to-date on the nuances of political debates occurring in America in particular either, and I will of course exhibit an unknown Continental, centrist, statist bias.
I wish to remark however that mine is a purely doctrinarian point of view, argued from first principles, and that bitcoin is by no means my field of expertise. I'm just looking at is as any neoliberal/monetarist financial economist (with a passion for market failures and the study of disequilibria) would.
To coin an analogy (pardon the pun): I'm like a chemist telling people about how dangerous plutonium is, purely on the basis of its chemical reactivity and toxicity, blissfully ignorant of its transcendent physical reactivity and fissile potential.
Within the window of that proviso, and assuming I have more to say on the topic (it might surprise you, but I'm not terribly interested in bitcoin, and don't bother to stay up to date on it beyond the occasional sensationalistic news that filters through Bloomberg and international media), I'm always eager to have a rational, measured conversation even between people that disagree. I'm not a bitcoin guru, I'm not an active equities, commodities, or derivatives analyst or investor, and I concern myself with the comparatively mundane task of running a family business that has blossomed into a multinational corporation. Despite what my written English may belay I'm not even an Anglo-Saxon, so I couldn’t declare myself to be entirely up-to-date on the nuances of political debates occurring in America in particular either, and I will of course exhibit an unknown Continental, centrist, statist bias.
Cool, what does this have to do with Filecoin, their ICO, and Ponzi schemes?
A MLM scheme is that: a scheme requiring a central actor to pay commissions. This is why Bitcoin and decentralized currency has never fit this definition.
You could say there are some abstract resemblances (BTC bagholders encourage others to buy) but this is just abstract and not specific enough to fit the definition.
We've seen people run Ponzis using BTC, we've seen ICOs structured as Ponzis. However "Bitcoin is a Ponzi/pyramid/MLM" will never be true; not literally at least.
A MLM scheme is that: a scheme requiring a central actor to pay commissions. This is why Bitcoin and decentralized currency has never fit this definition.
You could say there are some abstract resemblances (BTC bagholders encourage others to buy) but this is just abstract and not specific enough to fit the definition.
We've seen people run Ponzis using BTC, we've seen ICOs structured as Ponzis. However "Bitcoin is a Ponzi/pyramid/MLM" will never be true; not literally at least.
The argument is that Bitcoin is a decentralized, globally distributed Ponzi scheme, in the same way that it asserts itself to be a decentralized, globally distributed payment network. It seems unfair for Bitcoin proponents to go around saying "it's gotta be centralized or it's not really X".
Unless the most basic definition of X relies on a central actor, like a Ponzi. In which case it's not only fair, but accurate.
You're comparing Bitcoin to diamond, but there are many more asset classes that are actually more similar to Bitcoin, which actually work.
I think a lot of people make the mistake of using pattern matching to judge Bitcoin when they don't have enough patterns to work with. There are and were many financial products that could have worked (but failed because of corruption) or are working currently that most people who don't do a lot of financial investment aren't aware of.
That said, let me go through each of the comparisons you made:
> Its original bump in value come from a marketing campaign (even if with Diamond it was centralized and offline, and with BTC is decentralized and viral)
Diamond has a centralized cartel that does the marketing. Who do you think is doing the marketing for Bitcoin?
> Its scarcity is artificially controlled
Diamond's artificial scarcity is controlled by the cartel, just like OPEC controls oil.
Who do you think "controls" Bitcoin's scarcity?
> Its main use case is black market commerce (for one side of the argument) or money laundry (for the other side).
Nope. That's what you probably read a few years ago from some mainstream media.
I think a lot of people make the mistake of using pattern matching to judge Bitcoin when they don't have enough patterns to work with. There are and were many financial products that could have worked (but failed because of corruption) or are working currently that most people who don't do a lot of financial investment aren't aware of.
That said, let me go through each of the comparisons you made:
> Its original bump in value come from a marketing campaign (even if with Diamond it was centralized and offline, and with BTC is decentralized and viral)
Diamond has a centralized cartel that does the marketing. Who do you think is doing the marketing for Bitcoin?
> Its scarcity is artificially controlled
Diamond's artificial scarcity is controlled by the cartel, just like OPEC controls oil.
Who do you think "controls" Bitcoin's scarcity?
> Its main use case is black market commerce (for one side of the argument) or money laundry (for the other side).
Nope. That's what you probably read a few years ago from some mainstream media.
Could you tell us what financial products you think bear a closer similarity to bitcoin?
Why does it matter that there's no single centralized group who does the marketing and controls scarcity? Bitcoin's entire selling point is that those kinds of things can happen without centralization!
Nobody seems to wonder why the world's leading economists of the era, faced with the stagflation of the 1970s, collectively recommended to move away from limited supplies of money (bimetallism, representative money aka golden standard et al) and towards fiat currency. Does everybody really think they were stupid or that their reasoning has been obsoleted? The core problem with those systems was not whether they were centralised or not, it was that ultimately the supply of money was fixed by the availability of the underlying asset, and decentralised fixed supply blockchain technology such as bitcoin is solving the wrong problem. Indeed it is goddamn noxious for the economy at large to have a fixed supply of money, I wouldn't wish it on anybody: for starters, banks cannot do fractional reserve lending and are restricted to sharing out only the currency that has been deposited into their accounts by savers, driving up the cost of money (interest rates) to exorbitant rates (because, roughly, you lose the “economies of scale” inherent in wholesale banking and lending), secondly, you limit economic growth, because the lack of inflation does not mean debt-service becomes more manageable over time, and thus de-incentivise investment. The technologists that venerate bitcoin have certainly “disrupted” the financial order, but they don't realise how ignorant of economic orthodoxy their underlying assumption (that a finite, fixed amount of money) is. All these people approach money and wealth with the intuition of a zero-sum, ‘conserved’ quantity as momentum or the balance of mass are, but it's not. Wealth is not a conserved quantity: a marking an asset to market in a single transaction creating or destroying wealth for all the asset holders because the market capitalisation changes in response to the price change with a (comparatively tiny) amount of money having actually being transacted. These people are really ignorant of somebody else's field of expertise, and as usual the whole public is becoming enamoured of their muttering simply because speculative mania is setting in and driving the asset up and up in price.
You want to know what is scary? Two weeks ago my sister's former boyfriend, a private soldier that left school at sixteen, started gushing enthusiastically about bitcoin and about how he had made fifty euro on his investment over the past three weeks. I started to feel sick in the pit of my stomach and I thought of how Henry Ford called his broker and instructed him to “sell everything” when his doorman or elevator-operator (anecdotes differ in detail) started telling him about stocks in 1929.
Folks, sell everything.
EDIT: Oh heh today bitcoin crashed, again. How amusing.
You want to know what is scary? Two weeks ago my sister's former boyfriend, a private soldier that left school at sixteen, started gushing enthusiastically about bitcoin and about how he had made fifty euro on his investment over the past three weeks. I started to feel sick in the pit of my stomach and I thought of how Henry Ford called his broker and instructed him to “sell everything” when his doorman or elevator-operator (anecdotes differ in detail) started telling him about stocks in 1929.
Folks, sell everything.
EDIT: Oh heh today bitcoin crashed, again. How amusing.
Bikeshedding this some more because HN is for bikeshedding...
I am toying around with the wacky heresy that Karl Marx (not Lenin) was right. Capitalism will evolve into socialism.
It would be a form of socialism we haven't seen yet and that would have been technologically impossible in the past. Capitalism's role is to develop the technology, wealth, and infrastructure to enable it... as Marx said. Tech titans, startuppers, hackers, and VCs are in this view actually communist revolutionaries of a sort.
The new socialism would be fully decentralized, consensus based, anti-fragile, nameless, leaderless, borderless, and viral as hell. It would just take over by viral attrition. Later on historians would be like "wow, we now have a completely new social paradigm."
My read on Marx's original speculative idea was closer to that and quite far from the USSR. The USSR was like the ancient Egyptians deciding to build social media based on this vague wishy-washy futurist idea of what that is but without any of the tools or core innovations. They would have ended up with something that basically didn't work and in no way resembled Twitter, LinkedIn, or Facebook. Without the core enabling innovations they would not have been able to even imagine those, let alone build them. The apparatchiks and politburo of the USSR could not have imagined distributed consensus operating at global scale. The tools to even think about that didn't exist. They basically tried to force-fit the goals of socialism using the methods of fascism with predictably awful results.
I also think many capitalists of the Randian/libertarian school will see this as capitalism and not socialism since it will retain capitalist elements or at least entities and institutions that outwardly resemble them and fulfill the same functions. There will still be money, fund raising, capital gains, corporations in some form, etc. That's fine. Names don't matter. It will be nameless and formless.
Edit: I still see Bitcoin as version 0.1 alpha of something much more significant. I am more interested in what version 2.0, 3.0, or 4.0 might look like. I think Ethereum is version 0.5 beta. Version 1.0 will be something that somehow ditches the expensive boat-anchor of proof-of-work, resolves transactions a lot faster, and is way more secure and powerful.
I also do think Bitcoin at the moment is a bubble. Something being a major innovation and a bubble are not mutually exclusive. In fact most major innovations lead to bubbles when they first start climbing their hype/adoption curve.
I am toying around with the wacky heresy that Karl Marx (not Lenin) was right. Capitalism will evolve into socialism.
It would be a form of socialism we haven't seen yet and that would have been technologically impossible in the past. Capitalism's role is to develop the technology, wealth, and infrastructure to enable it... as Marx said. Tech titans, startuppers, hackers, and VCs are in this view actually communist revolutionaries of a sort.
The new socialism would be fully decentralized, consensus based, anti-fragile, nameless, leaderless, borderless, and viral as hell. It would just take over by viral attrition. Later on historians would be like "wow, we now have a completely new social paradigm."
My read on Marx's original speculative idea was closer to that and quite far from the USSR. The USSR was like the ancient Egyptians deciding to build social media based on this vague wishy-washy futurist idea of what that is but without any of the tools or core innovations. They would have ended up with something that basically didn't work and in no way resembled Twitter, LinkedIn, or Facebook. Without the core enabling innovations they would not have been able to even imagine those, let alone build them. The apparatchiks and politburo of the USSR could not have imagined distributed consensus operating at global scale. The tools to even think about that didn't exist. They basically tried to force-fit the goals of socialism using the methods of fascism with predictably awful results.
I also think many capitalists of the Randian/libertarian school will see this as capitalism and not socialism since it will retain capitalist elements or at least entities and institutions that outwardly resemble them and fulfill the same functions. There will still be money, fund raising, capital gains, corporations in some form, etc. That's fine. Names don't matter. It will be nameless and formless.
Edit: I still see Bitcoin as version 0.1 alpha of something much more significant. I am more interested in what version 2.0, 3.0, or 4.0 might look like. I think Ethereum is version 0.5 beta. Version 1.0 will be something that somehow ditches the expensive boat-anchor of proof-of-work, resolves transactions a lot faster, and is way more secure and powerful.
I also do think Bitcoin at the moment is a bubble. Something being a major innovation and a bubble are not mutually exclusive. In fact most major innovations lead to bubbles when they first start climbing their hype/adoption curve.
>I am toying around with the wacky heresy that Karl Marx (not Lenin) was right. Capitalism will evolve into socialism.
that Marx discovered is that the degree of socialism rises and of capitalism decreases linear with the rise of entropy of ownership distribution. One owner of a factory - full capitalism. Many shareholders without any major concentrated holder - any such BigCo feels very close to socialism (where everybody is nominally an owner of everything) as we experienced back at the USSR.
> fully decentralized, consensus based, anti-fragile, nameless, leaderless, borderless, and viral as hell.
characteristics of high entropy, except for the consensus based and leaderless which are supposed to be an emerging property to manage the target object, yet as history shows delegation emerges to make management tractable in high entropy situations and it results in concentrated management power without corresponding ownership - typical socialism of USSR or BigCo or Federal government managed assets and agencies. Thus such a theory predicts some management "council of BTC Jedi-s" to emerge.
that Marx discovered is that the degree of socialism rises and of capitalism decreases linear with the rise of entropy of ownership distribution. One owner of a factory - full capitalism. Many shareholders without any major concentrated holder - any such BigCo feels very close to socialism (where everybody is nominally an owner of everything) as we experienced back at the USSR.
> fully decentralized, consensus based, anti-fragile, nameless, leaderless, borderless, and viral as hell.
characteristics of high entropy, except for the consensus based and leaderless which are supposed to be an emerging property to manage the target object, yet as history shows delegation emerges to make management tractable in high entropy situations and it results in concentrated management power without corresponding ownership - typical socialism of USSR or BigCo or Federal government managed assets and agencies. Thus such a theory predicts some management "council of BTC Jedi-s" to emerge.
I'm trying to see how small numbers of bourgeois nerds running energy intensive get-rich-quick schemes - often with the help of billionaire backers - resembles the Marxian concept of the proleteriat fighting to gain the full benefit of their day's labour and struggling tbh...
Lenin, 1918, in an article called "Left-Wing Childishness":
Socialism is inconceivable without large-scale capitalist engineering based on the latest discoveries of modern science. [...]
Only those are worthy of the name of Communists who understand that it is impossible to create or introduce socialism without learning from the organisers of the trusts. For socialism is not a figment of the imagination, but the assimilation and application by the proletarian vanguard, which has seized power, of what has been created by the trusts. We, the party of the proletariat, have no other way of acquiring the ability to organise large-scale production on trust lines, as trusts are organised, except by acquiring it from first-class capitalist experts.
We have nothing to teach them, unless we undertake the childish task of “teaching” the bourgeois intelligentsia socialism. We must not teach them, but expropriate them (as is being done in Russia “determinedly” enough), put a stop to their sabotage, subordinate them as a section or group to Soviet power. We, on the other hand, if we are not Communists of infantile age and infantile understanding, must learn from them, and there is something to learn, for the party of the proletariat and its vanguard have no experience of independent work in organising giant enterprises which serve the needs of scores of millions of people.
Socialism is inconceivable without large-scale capitalist engineering based on the latest discoveries of modern science. [...]
Only those are worthy of the name of Communists who understand that it is impossible to create or introduce socialism without learning from the organisers of the trusts. For socialism is not a figment of the imagination, but the assimilation and application by the proletarian vanguard, which has seized power, of what has been created by the trusts. We, the party of the proletariat, have no other way of acquiring the ability to organise large-scale production on trust lines, as trusts are organised, except by acquiring it from first-class capitalist experts.
We have nothing to teach them, unless we undertake the childish task of “teaching” the bourgeois intelligentsia socialism. We must not teach them, but expropriate them (as is being done in Russia “determinedly” enough), put a stop to their sabotage, subordinate them as a section or group to Soviet power. We, on the other hand, if we are not Communists of infantile age and infantile understanding, must learn from them, and there is something to learn, for the party of the proletariat and its vanguard have no experience of independent work in organising giant enterprises which serve the needs of scores of millions of people.
You're right. I'm not talking about Bitcoin but about the technology and understanding that it represents. Bitcoin itself is a proof of concept project that's unfortunately become a silly bubble.
Forget about coins or even currency. Consider what these systems are doing. They are giving you trust and coherence without authority.
Forget about coins or even currency. Consider what these systems are doing. They are giving you trust and coherence without authority.
Sounds kind of like this article: https://www.bloomberg.com/view/articles/2016-08-24/are-index...
USSR implemented socialism, and all countries that ever called themselves "communist" were socialists.
There's a big difference between communism and socialism. And I think cryptocurrency will enable communism and not socialism. Socialism was a compromise path to get to communism, but failed because of its centralized nature.
With decentralized currency you don't need to go through socialism, you jump straight to communism.
There's a big difference between communism and socialism. And I think cryptocurrency will enable communism and not socialism. Socialism was a compromise path to get to communism, but failed because of its centralized nature.
With decentralized currency you don't need to go through socialism, you jump straight to communism.
Why does one painting sell for $10 and another for $100 million?
People can put value in whatever they want. I don't think there's a real objective way to say "oh yeah, it's mathematically proven that a diamond ring should cost $10,000...or a $1,000,000 if it's say Marilyn Monroe's ring, and that a single Bitcoin should have a value of no more than $10."
People can put value in whatever they want. I don't think there's a real objective way to say "oh yeah, it's mathematically proven that a diamond ring should cost $10,000...or a $1,000,000 if it's say Marilyn Monroe's ring, and that a single Bitcoin should have a value of no more than $10."
True, but I think we all can say with some certainty that "a token intended to be used as currency should not regularly increase or decrease in value by 20% or more in a matter of days or weeks".
Who on earth would actually spend any Bitcoins right now? If you'd bought a Pizza with BTC back in 2010, you could have bought a car (or house?) instead only several years later. This type of volatility makes it totally unsuitable as currency.
Who on earth would actually spend any Bitcoins right now? If you'd bought a Pizza with BTC back in 2010, you could have bought a car (or house?) instead only several years later. This type of volatility makes it totally unsuitable as currency.
"Who on earth would actually sell any Bitcoins right now" (spend and sell have the same effect)... yet in the market, there's a seller in front of every buyer.
Regarding stuff being priced in BTC, prices are falling when BTC is rising. Who doesn't like lower and lower prices?
That pizza used to cost 50,000 BTC, it's only 0.0003 BTC today!
Bitcoin is a deflationary currency.
Regarding stuff being priced in BTC, prices are falling when BTC is rising. Who doesn't like lower and lower prices?
That pizza used to cost 50,000 BTC, it's only 0.0003 BTC today!
Bitcoin is a deflationary currency.
> a seller
I'm curious how many sellers. When someone quotes a dramatic increase in housing prices in a city, that's not just a single house.
I'm curious how many sellers. When someone quotes a dramatic increase in housing prices in a city, that's not just a single house.
> Who on earth would actually spend any Bitcoins right now? If you'd bought a Pizza with BTC back in 2010, you could have bought a car (or house?) instead only several years later. This type of volatility makes it totally unsuitable as currency.
Will it not eventually stabilise? When it's just starting out and only few people believe in its value it seems inevitable it's going to be volatile in the early days. Some people have to start making the first purchases in the beginning so if people weren't buying pizza and whatever with it when Bitcoin was low in value it wouldn't be valued what it is now.
Will it not eventually stabilise? When it's just starting out and only few people believe in its value it seems inevitable it's going to be volatile in the early days. Some people have to start making the first purchases in the beginning so if people weren't buying pizza and whatever with it when Bitcoin was low in value it wouldn't be valued what it is now.
> Who on earth would actually spend any Bitcoins right now?
Huh? Every bitcoin bought is a bitcoin sold.
Huh? Every bitcoin bought is a bitcoin sold.
I'm confused. Are you talking about diamonds, the precious gemstone? Why are you capitalizing it?
> I misread the title and commented here, but now I can't find the correct thread
Is it this one?
https://news.ycombinator.com/item?id=15816294
Is it this one?
https://news.ycombinator.com/item?id=15816294
yes!
I don't agree with the comparison between diamonds and bitcoin. The supply of diamonds is constrained (just like the supply of many luxury goods) and that ends up making a physical product (a diamond ring or jewelry or even a Porsche (yep supply is constrained on that beyond what the market would buy)) more highly sought and valuable. But in the end you are getting a physical product which you can lust over and others can admire when they see you own it. The same does not exist with bitcoin. This is not even to mention that both diamonds and Porsches have actual use even if that use can be supplied by less expensive alternatives. Even Gold has this advantage. These are not tulip mania products that got bid up either and they have generally maintained and stood the test of time with regards to both their value and their utility. (Even if the utility of a diamond ring is what the person wearing it gets in good feeling).
filecoin is not BTC. BTC does have an inherent value, but only within the system. You're analogies to diamonds make no sense because diamonds are easy to produce and their cost does not reflect either the demand or the production of them. BTC, however, is required to actually run the system, are hard to produce and their value is set on their limited production plus demand. It is true that BTC currently has little value outside of the system, but that is not the same as saying it has no inherent value.
BTC does have inherent value if there exists a class of transactions that cannot be settled in any other form of payment.
Extortion where the extortionist demands payment in bitcoin fulfills that predicate.
Not saying that this is what drives the daily ups and downs of BTC (or rather: ups and even more ups, recently), but if you are looking for inherent value, this is what you get. Just like the use of gold in manufacturing is very much not the driver of gold price fluctuations, despite being the base of the inherent value.
Extortion where the extortionist demands payment in bitcoin fulfills that predicate.
Not saying that this is what drives the daily ups and downs of BTC (or rather: ups and even more ups, recently), but if you are looking for inherent value, this is what you get. Just like the use of gold in manufacturing is very much not the driver of gold price fluctuations, despite being the base of the inherent value.
I don't think Bitcoin was designed as a scheme, but it's effectively been turned into an MLM scheme and a brilliant one at that.
I'm trying to hire a PR firm for a project and I've come across a handful of firms that have been hired to promote BTC.
Think about that for a minute: if BTC is distributed - then who on earth is paying massive $$$ for PR firms to be hustling BTC in the press? Massive BTC owners - that's who.
Also problematic is so many in the press reporting on it have positions in BTC they are not disclosing (although this might be changing).
And every owner of BTC seems to be a willing (or unwitting) participant in the propagandization simply by commenting it up on the various boards and chats around the internet.
It's an amazing phenom - the intersection of cool tech, the internet - and age old ponzi/pyramid schemes.
And it has not even yet hit mainstream - most readers here might think BTC is 'old hat' but it takes a long time for things to hit mainstreet - and even after they hit mainstreet USA, it takes a while to hit 'mainstreet globally'. Remember: when all your friends were on Facebook? It tooks several years for 'everyone in the world' to be on it.
The barrier to growth is that it is quite tricky to buy - my Mother is on Facebook and she will never by BTC unless there are some real changes - though I can see a 3rd party creating a solution.
Do you know Glen Beck's scammy 'buy gold from us' commercials, where people buy gold in coin format basically at 20% above market value?
The 'buy Gold' phenom used to hustle gold does well among those 'end of the world / I don't trust the government types' - the same people who buy 'end of the world seeds' (from Glen Beck as well!) - and BTC fits in perfectly with this narrative.
So - get ready for 'Glenn Beck supported Bitcoin Wallet' - then it will get really big, possibly go global. And then, who knows.
So many interesting outcomes: if there is too much noise about it being used in organized crime I can see a Scandinavian country banning it, with talk of EU banning it ... the US could move quickly to do something. On some level - this will actually strengthen BTC among the 'anti government' crowd.
For it to lose price, there kind of has to be a systematic reason for it to do so - and kind of a panic. Once the press starts touting 'BTC Crash' - you can be sure it will happen - though there are enough massive, institutional holders that it won't likely go to zero.
I think it will be around for a long while though - my guess is that there is some kind of crash at some point, but not to zero, some governments clamp down, and then people over a long period of time just stop talking about it and using it.
I'm trying to hire a PR firm for a project and I've come across a handful of firms that have been hired to promote BTC.
Think about that for a minute: if BTC is distributed - then who on earth is paying massive $$$ for PR firms to be hustling BTC in the press? Massive BTC owners - that's who.
Also problematic is so many in the press reporting on it have positions in BTC they are not disclosing (although this might be changing).
And every owner of BTC seems to be a willing (or unwitting) participant in the propagandization simply by commenting it up on the various boards and chats around the internet.
It's an amazing phenom - the intersection of cool tech, the internet - and age old ponzi/pyramid schemes.
And it has not even yet hit mainstream - most readers here might think BTC is 'old hat' but it takes a long time for things to hit mainstreet - and even after they hit mainstreet USA, it takes a while to hit 'mainstreet globally'. Remember: when all your friends were on Facebook? It tooks several years for 'everyone in the world' to be on it.
The barrier to growth is that it is quite tricky to buy - my Mother is on Facebook and she will never by BTC unless there are some real changes - though I can see a 3rd party creating a solution.
Do you know Glen Beck's scammy 'buy gold from us' commercials, where people buy gold in coin format basically at 20% above market value?
The 'buy Gold' phenom used to hustle gold does well among those 'end of the world / I don't trust the government types' - the same people who buy 'end of the world seeds' (from Glen Beck as well!) - and BTC fits in perfectly with this narrative.
So - get ready for 'Glenn Beck supported Bitcoin Wallet' - then it will get really big, possibly go global. And then, who knows.
So many interesting outcomes: if there is too much noise about it being used in organized crime I can see a Scandinavian country banning it, with talk of EU banning it ... the US could move quickly to do something. On some level - this will actually strengthen BTC among the 'anti government' crowd.
For it to lose price, there kind of has to be a systematic reason for it to do so - and kind of a panic. Once the press starts touting 'BTC Crash' - you can be sure it will happen - though there are enough massive, institutional holders that it won't likely go to zero.
I think it will be around for a long while though - my guess is that there is some kind of crash at some point, but not to zero, some governments clamp down, and then people over a long period of time just stop talking about it and using it.
Agree. For one, BTC's decentralized nature makes the ponzi scheme highly resilient and scalable. On top of that, the coolness factor is undeniable.
As the Yale economist Robert J. Shiller puts it "You’re fast. You’re smart. You’ve figured out nobody else understands. You’re with it. And bitcoin has this anti-government, anti-regulation feel. It’s such a wonderful story. If it were only true."[1]
Therefore the bubble will most likely stretch a lot bigger (the current market cap of total crypto is 1-1.5% of US equity) before people get scared. But when they do, the fear will indeed be fueled by negative media coverage which might make the crash swift and brutal.
[1]https://www.bloomberg.com/news/articles/2017-11-30/so-it-loo...
As the Yale economist Robert J. Shiller puts it "You’re fast. You’re smart. You’ve figured out nobody else understands. You’re with it. And bitcoin has this anti-government, anti-regulation feel. It’s such a wonderful story. If it were only true."[1]
Therefore the bubble will most likely stretch a lot bigger (the current market cap of total crypto is 1-1.5% of US equity) before people get scared. But when they do, the fear will indeed be fueled by negative media coverage which might make the crash swift and brutal.
[1]https://www.bloomberg.com/news/articles/2017-11-30/so-it-loo...
I don’t think that the existence of marketing firms involved in decentralized technologies is anywhere near as significant or mind-blowing of a point as you portray it.
There is no reason to expect or desire that, because Bitcoin is decentralized, there will never be any private for-profit organizations involved with Bitcoin.
Surely you wouldn’t say the same thing about, say, email. I’m sure marketing firms have worked with companies that offer services involving email.
There is no reason to expect or desire that, because Bitcoin is decentralized, there will never be any private for-profit organizations involved with Bitcoin.
Surely you wouldn’t say the same thing about, say, email. I’m sure marketing firms have worked with companies that offer services involving email.
It's a fair point ... but ...
Making an email product and hiring PR to promote email I think is a little bit different than 'owning a stock and hiring PR to promote that stock'.
BTC is purely a speculative thing right now - and so hiring PR to pump up a purely speculative thing? "It's going to $10K and it's only going up, up, up!"
If they were promoting BTC as a medium of exchange and as currency, sure ... but as a purely speculative asset it's smells like a pump and dump.
Making an email product and hiring PR to promote email I think is a little bit different than 'owning a stock and hiring PR to promote that stock'.
BTC is purely a speculative thing right now - and so hiring PR to pump up a purely speculative thing? "It's going to $10K and it's only going up, up, up!"
If they were promoting BTC as a medium of exchange and as currency, sure ... but as a purely speculative asset it's smells like a pump and dump.
No one is paying bitcoin to be hustled in the press except
advertisers indirectly, since writint $10,000 barrier broken gains lots and lots of clicks --> more ad money earned.
Well, bitcoin is actually solving a real world problem, unlike diamond. Seems way too much effort and thinking for a ponzi, I mean the result is actually groundbreaking work.
Bitcoin is a poor solution to the problem of transferring money: it's slow, power-inefficient, controlled by an oligopoly of miners, and vulnerable to scams.
Because it’s not a primarily solution to transferring money, it’s primarily decentralized, trustless and censorship-resistant solution to that. Of course centralized solutions are cheaper and more efficient.
This and that there is a hard upper limit on the amount of bitcoin available. There will be no QE of bitcoin.
until the miners are convinced otherwise
bit like the central banks
bit like the central banks
not at all like central banks because mining is decentralized. Besides, there are also users and merchants who are just as important and miners don’t dare pushing changes that nobody wants.
Do you realize that of miners decided to fork in favor of a model which is better fit them, there will be a shortage of block mining until the difficulty declines. Which means transactions would be frozen for around a month. I'm not sure users and merchands could stand that fight …
Some already did - bitcoin cash.
Rational miners realize that forcing a protocol change that isn’t acceptable to users or merchants will destroy valuation of the fork they choose to mine, so there is discebtive from such behavior.
But yes, if they do it anyway, there will be period with very slow blocks and that will hurt the project a lot but then difficulty will adjust downward.
Rational miners realize that forcing a protocol change that isn’t acceptable to users or merchants will destroy valuation of the fork they choose to mine, so there is discebtive from such behavior.
But yes, if they do it anyway, there will be period with very slow blocks and that will hurt the project a lot but then difficulty will adjust downward.
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Yes, early computer pioneers also engaged in groundbreaking work.
A huge mainframe filled with vacuum tubes seems to fit here. That’s bitcoin, currently, but for “magic internet money”. The bandwidth, throughout, and power utilization are what you might expect from such a first generation technology experiment.
The benefits of bitcoin are eclipsed by the meteoric rise, and this price increase is the basis for most new folks getting on board, not so they can use it now as a currency.
A huge mainframe filled with vacuum tubes seems to fit here. That’s bitcoin, currently, but for “magic internet money”. The bandwidth, throughout, and power utilization are what you might expect from such a first generation technology experiment.
The benefits of bitcoin are eclipsed by the meteoric rise, and this price increase is the basis for most new folks getting on board, not so they can use it now as a currency.
1) those mainframes got people to the moon
2) nothing in bitcoin protocol precludes it from adopting more efficient solutions when such appear, what people seem to miss is that proof of work itself and energy spent securing the ledger will always correlate with value stored
2) nothing in bitcoin protocol precludes it from adopting more efficient solutions when such appear, what people seem to miss is that proof of work itself and energy spent securing the ledger will always correlate with value stored
1) So, a worldwide payment solution requires a spaceship, but we have first generation mainframes currently. Bitcoin is the biggest of those mainframes, uses the most energy, etc.
2) You touched upon two independent considerations.
Yes, bitcoin can evolve technologically, but it’s not assured.
Energy spent is based on incentive. Value stored isn’t directly correlated, that’s a result of price which results from buyers and sellers, which results from sentiment. Now we get into disparate supply and demand based on information advantage.
Energy utilization as it correlates to some incentive to expend such energy for monetary gain is indirectly coupled to the stored value. Other factors affect this. The market is not efficient, it behaves, pricewise, like many markets before it.
Greatest bubble of our generation, but admittedly quite the clever one. The truth is that some Silicon Valley insiders amongst other movers and shakers saw bitcoin’s potential early on for such a rise to where we are now (and possibly way more), by design and precisely because they control the narrative. It’s been exploited by smart folks. If you had the means, foresight, and motivation, you were in a privileged position to transfer wealth to yourself. Now, this is not the case.
Real people get hurt by the economic cycles we’ve seen and bitcoin is, for some, a way to be robin hood in that long time narrative.
2) You touched upon two independent considerations.
Yes, bitcoin can evolve technologically, but it’s not assured.
Energy spent is based on incentive. Value stored isn’t directly correlated, that’s a result of price which results from buyers and sellers, which results from sentiment. Now we get into disparate supply and demand based on information advantage.
Energy utilization as it correlates to some incentive to expend such energy for monetary gain is indirectly coupled to the stored value. Other factors affect this. The market is not efficient, it behaves, pricewise, like many markets before it.
Greatest bubble of our generation, but admittedly quite the clever one. The truth is that some Silicon Valley insiders amongst other movers and shakers saw bitcoin’s potential early on for such a rise to where we are now (and possibly way more), by design and precisely because they control the narrative. It’s been exploited by smart folks. If you had the means, foresight, and motivation, you were in a privileged position to transfer wealth to yourself. Now, this is not the case.
Real people get hurt by the economic cycles we’ve seen and bitcoin is, for some, a way to be robin hood in that long time narrative.
1) the point is, we’ve just started
2)
How is it not assured that bitcoin will evolve? It evolves all the time. Are you even following the project?
Energy spent correlates with incentive, incentive is based on price, price is based on demand/value. Where is demand/perceived value derived from is debatable.
The rest of your message equally applies to all other endeavors where early movers have profited. Yes it’s a bubble, yes markets are inefficient, yes people get hurt, how is any of that different from the what was happening in other sectors? Cryptocurrencies are here to stay.
2)
How is it not assured that bitcoin will evolve? It evolves all the time. Are you even following the project?
Energy spent correlates with incentive, incentive is based on price, price is based on demand/value. Where is demand/perceived value derived from is debatable.
The rest of your message equally applies to all other endeavors where early movers have profited. Yes it’s a bubble, yes markets are inefficient, yes people get hurt, how is any of that different from the what was happening in other sectors? Cryptocurrencies are here to stay.
1) Yes, and bitcoin isn’t the only player in town.
2) It’s not assured that major breakthroughs will occur within the bitcoin ecosystem, nor that they will fold back into it.
I’m pretty familiar with bitcoin’s current technology developments. There are opinions, theories, and experiments flying around about how to build that rocket ship. Very very early and unclear.
The energy usage is not sustainable; we don’t have “decentralized logarithmically increasing clean energy sources” upon which to build bitcoin’s network to the stratospheric levels needed to achieve moonshot valuations, not without a serious innovation in technology to evolve the usage of bitcoin as a currency. Something better and more energy efficient for a trustless solution could come along.
Most everyone knows cryptocurrencies are here to stay but that’s not directly related to bitcoin, it’s price, it’s tech evolution specifically, and how it may or may not evolve into a viable currency.
2) It’s not assured that major breakthroughs will occur within the bitcoin ecosystem, nor that they will fold back into it.
I’m pretty familiar with bitcoin’s current technology developments. There are opinions, theories, and experiments flying around about how to build that rocket ship. Very very early and unclear.
The energy usage is not sustainable; we don’t have “decentralized logarithmically increasing clean energy sources” upon which to build bitcoin’s network to the stratospheric levels needed to achieve moonshot valuations, not without a serious innovation in technology to evolve the usage of bitcoin as a currency. Something better and more energy efficient for a trustless solution could come along.
Most everyone knows cryptocurrencies are here to stay but that’s not directly related to bitcoin, it’s price, it’s tech evolution specifically, and how it may or may not evolve into a viable currency.
It’s energy producing companies that worry about sustainability, not energy spending. Energy spending endeavors only worry about profitability. So it’s absolutely misguided to scold bitcoin over it’s use of energy and not do the same for instance to people heating up their apartments or driving cars or insert your energy spending activity.
Increasing efficiency of bitcoins proof of work will simply bump the difficulty so energy use will remain the same.
Increasing efficiency of bitcoins proof of work will simply bump the difficulty so energy use will remain the same.
There’s a difference between scolding energy usage and pointing out that the design itself, even if efficiency of that design is increased, is what leads to this spiraling energy expenditure that powers massive computational hashing power only to support that currency and nothing else (no other social or technical goals). There are better ways to design such a system to do more than perform endless hashing that is merely self-serving. Furthermore, there could be innovations related to a trustless system that will make bitcoin itself obsolete; the future of bitcoin as leader isn’t guaranteed.
This isn’t related to heating or driving efficiency.
This isn’t related to heating or driving efficiency.
You seem to be convinced there are better ways to implement a distributed consensus mechanism that doesn’t depend on proof of work. Feel free to present it to the world and become the next satoshi. Meanwhile - face the reality. PoW will consume as much energy as is profitable and only market decides that.
I’m convinced people are searching for it. I’m convinced there’s a huge nouveau academic interest in this area. This just helps to estimate likelihood of bitcoin’s longevity.
Yes, precisely, you always need buyers to push price further. Market decides up or down, miners play along as it makes sense to them. Kind of like the swap over to bcash about a month ago, because it made sense financially.
Yes, precisely, you always need buyers to push price further. Market decides up or down, miners play along as it makes sense to them. Kind of like the swap over to bcash about a month ago, because it made sense financially.
> How is it not assured that bitcoin will evolve? It evolves all the time. Are you even following the project?
I mean, are you even following the project? Very, very basic changes like "let's change this parameter from 1 to 2" are incredibly contentious, leading to hard forks and loud debates and furious accusations that people are shills trying to ruin Bitcoin for personal profit. If we can't even behave ourselves for a trivial proposal like Segwit2x, how could a truly significant protocol change ever get anywhere?
I mean, are you even following the project? Very, very basic changes like "let's change this parameter from 1 to 2" are incredibly contentious, leading to hard forks and loud debates and furious accusations that people are shills trying to ruin Bitcoin for personal profit. If we can't even behave ourselves for a trivial proposal like Segwit2x, how could a truly significant protocol change ever get anywhere?
Bumping blocksize is contentious hardfork because not everybody is convinced it is the right way to scale (and i somewhat agree). Segwit otoh was implemented as backward compatible soft fork. Segwit2x is a deliberate attack on the network and i’m happy it failed.
Overall everybody got what they wanted - big blockers have BCH, conservatives have original BTC plus the capacity increase from segwit.
Overall everybody got what they wanted - big blockers have BCH, conservatives have original BTC plus the capacity increase from segwit.
Where did the funding for this research paper come from, specifically?
Most likely the Dutch tax payer.
Edit: Why am I being downvoted? The author even pointed out he is a student at this Dutch public university in a sister comment.
Edit: Why am I being downvoted? The author even pointed out he is a student at this Dutch public university in a sister comment.
It seems like the first author is still a student. So this could be a BSc./MSc. project, for example.
Author [Marc] here: I'm a master student at TU Delft and this was a literature survey in preparation for 1) the recent developments in the blockchain lab at TU Delft and 2) my master thesis -- and therefore also to stimulate my interests in blockchain technologies.
https://github.com/backender/filecoin-survey/releases
Seeing as the release is named "Release to turn in", I'd say so too.
Seeing as the release is named "Release to turn in", I'd say so too.
Filecoin is one of the ones I'd stay far away from. VCs got in before anyone else with special preferences, which taints the whole project. There are alternatives which don't come with the VC problem attached to them.
What is your recommended alternative? Is there any unusual involvement beyond participation as a user that you should probably disclose?
Sia is more legitimate. I don't own any Siacoin or Filecoin, but I would hold Siacoin if it was supported by the Ledger hardware wallet.
https://sia.tech/funding2016/ ? How is this any different? I realize that this doesn't concern an ICO, but still there is plenty of VC involvement to "taint" the project.
Sia didn't do an ICO. Every coin has been mined, with no premine (although I assume the developers mined the first few blocks at least). The investors could have mined too, if they wanted, along with anyone else. This seems more egalitarian to me.
[deleted]
Sia
So what is your opinion on Ethereum, given the knowledge that one of its co-founders was awarded a Thiel Fellowship?
There wasn't any Ethereum ICO. Every ETH was mined.
I'm not sure they were calling it an ICO around then, but there was absolutely an online public crowdsale in 2014.
You're correct, my bad.
Most token sales are like this. There is no difference from the equity markets in this regard, except its WAY more liquid, WAY faster route to liquidity, AND there is no dilution.
Sorry private equity, step to the left. Sorry egalitarian peons, take what you can get.
Sorry private equity, step to the left. Sorry egalitarian peons, take what you can get.
>>AND there is no dilution.
There's no dilution unless token stewards (usually structured as non-profit foundations) decide to increase the overall supply of tokens.
There's no dilution unless token stewards (usually structured as non-profit foundations) decide to increase the overall supply of tokens.
If they kept a treasury then they can add supply to the market which wasn't already in the trading float. The contracts themselves typically don't allow for more units to be created, unlike shares.
Contracts can be structured that way, like Numeraire's.
Contracts can be structured that way, like Numeraire's.
I think it would be helpful if the authors disclosed whether they invested in Filecoin. I didn't really see it anywhere. Did I miss it?
Author here: we did not invest; nor are we invested in any of the competitor projects mentioned in the article.
other author here, no ICO investments. We're actually working for many years on a similar system, non-profit non-ICO based. We know this scientific area a bit (see my other comment).
>>We're actually working for many years on a similar system...
Hmm, this is what you neglected to mention in the paper
Thanks for your clarifications. That was my guess too, I just wanted to confirm it.
tl;dr conclusion from the article: "Filecoin’s economic feasibility is hard to predict and, given
a simple summary of risk related points, the biggest hurdles are
probably going to be acceptance from the users. In addition,
Filecoin shows certain characteristics of a Ponzi scheme but
the trust built by the team members in the past leads us to
believe that it is not one. Filecoin’s Whitepaper introduces
novel concepts and predecessor projects by the team members
which prove their technical capabilities. Hence, it appears that
Filecoin is poised to be an outstanding project although it
remains to be seen if it will be adopted by the average cloud
storage user."
[Author here] short answer taken from our .PDF file:
"Considering that Dropbox [53] currently holds around 500 petabytes of user data [54], one could argue that Filecoin is overvalued."
Study we conducted with a master student at Delft University of Technology. Open lab notes when writing this paper: https://github.com/Tribler/tribler/issues/3097 Note TUDelft has currently 8 professors in their http://blockchain-lab.org Various scientists and 38 master students working on improving our own Filecoin-like system, based on our Trustchain fabric: https://github.com/Tribler/tribler/issues?q=is%3Aissue+is%3A... It's home to one of the largest blockchain labs of Europe.
"Considering that Dropbox [53] currently holds around 500 petabytes of user data [54], one could argue that Filecoin is overvalued."
Study we conducted with a master student at Delft University of Technology. Open lab notes when writing this paper: https://github.com/Tribler/tribler/issues/3097 Note TUDelft has currently 8 professors in their http://blockchain-lab.org Various scientists and 38 master students working on improving our own Filecoin-like system, based on our Trustchain fabric: https://github.com/Tribler/tribler/issues?q=is%3Aissue+is%3A... It's home to one of the largest blockchain labs of Europe.
Dropbox feels like the wrong thing to compare it to. IPFS isn't really for storing files privately. Public S3 buckets would be closer. I don't have any numbers to say if it's overvalued based on how much public cloud storage there is (I wouldn't be surprised if it were though).
Storage costs are hyper-deflationary. We have a NAS on a desk with 27 terabytes of storage and it cost under $1000 (with drives) and consumes about 40 watts of power. Ten years ago this would have cost closer to $5000-$10000 and consumed hundreds of watts of power. We bought it about a year and a half ago and already we could replace it for less than $500.
The idea of distributed storage at the edge is interesting but it's not something that would cost $250 million to build. We could probably build a friendly system for doing this for under $500k in developer time.
It's also a mystery how efforts like MaidSafe or whatever it's called this week have never managed to ship anything after getting multiple multi-million-dollar golden showers. Distributed storage of immutable content-addressable blobs is not that hard of a problem. BitTorrent kind of solved it long ago, albeit with a different UI/UX metaphor and use case. Just take those ideas and pivot them a little and wrap them around the S3 UI/UX metaphor and add payment channels or some other accounting mechanism and you're done. You don't necessarily need the sexiest tech. In fact sexy tech probably makes it more fragile and harder to use. DHT + hashing + RAID-type redundancy techniques + wallets will do it.
Everyone over-thinks and over-engineers things these days and it drives me crazy. Stop it. Intelligence is for the things you can't do, not for doing the things you can already do in more baroque ways. Intelligence is also for simplification. Complexification is stupidity.
The idea of distributed storage at the edge is interesting but it's not something that would cost $250 million to build. We could probably build a friendly system for doing this for under $500k in developer time.
It's also a mystery how efforts like MaidSafe or whatever it's called this week have never managed to ship anything after getting multiple multi-million-dollar golden showers. Distributed storage of immutable content-addressable blobs is not that hard of a problem. BitTorrent kind of solved it long ago, albeit with a different UI/UX metaphor and use case. Just take those ideas and pivot them a little and wrap them around the S3 UI/UX metaphor and add payment channels or some other accounting mechanism and you're done. You don't necessarily need the sexiest tech. In fact sexy tech probably makes it more fragile and harder to use. DHT + hashing + RAID-type redundancy techniques + wallets will do it.
Everyone over-thinks and over-engineers things these days and it drives me crazy. Stop it. Intelligence is for the things you can't do, not for doing the things you can already do in more baroque ways. Intelligence is also for simplification. Complexification is stupidity.
> Distributed storage of immutable content-addressable blobs is not that hard of a problem.
To do so equitably without the ability to be gamed is quite difficult. BitTorrent is quite game-able so we end up with closed communities and private trackers. To handwave these adversarial concerns away is unhelpful. Implement a s/kademlia DHT with all of the security conventions in latter papers and it becomes clear how hard it is to do safely. I am confident IPFS's DHT could be quite easily harmed (most are implemented around hash bucket closeness) if it were valuable enough to do so.
To do so equitably without the ability to be gamed is quite difficult. BitTorrent is quite game-able so we end up with closed communities and private trackers. To handwave these adversarial concerns away is unhelpful. Implement a s/kademlia DHT with all of the security conventions in latter papers and it becomes clear how hard it is to do safely. I am confident IPFS's DHT could be quite easily harmed (most are implemented around hash bucket closeness) if it were valuable enough to do so.
> we could replace it for less than $500
27 Terabytes of spinning rust with NAS hardware for $500? Not yet.
27 Terabytes of spinning rust with NAS hardware for $500? Not yet.
The sweet spot for drives is the 4Tb at about $100[1].
Seven of those will give you 28 raw Tb with $300 left over for case and power supply.
So not impossible.
[1] https://www.backblaze.com/blog/hard-drive-cost-per-gigabyte/
Seven of those will give you 28 raw Tb with $300 left over for case and power supply.
So not impossible.
[1] https://www.backblaze.com/blog/hard-drive-cost-per-gigabyte/
Siacoin with minio integration(fully integrated as of last week) allows you to have S3 compatible "edge storage" right now.
There's a lot to agree with and disagree with here.
Sia is currently (barely) working and was built for $1.25M, so $250M clearly isn't needed (except maybe for marketing, which generally costs more than development).
I don't think the approach of "the simplest thing that could possibly work" applies to the decentralized/blockchain space. When money is at stake, attackers come out of the woodwork.
Sia is currently (barely) working and was built for $1.25M, so $250M clearly isn't needed (except maybe for marketing, which generally costs more than development).
I don't think the approach of "the simplest thing that could possibly work" applies to the decentralized/blockchain space. When money is at stake, attackers come out of the woodwork.
Sorry to see this downvoted, if this were reddit there'd be some reddit gold right here.
> never managed to ship anything after getting multiple multi-million-dollar golden showers.
It's more then just linking hard-disks. It is really hard to build the incentives and market part. Read for instance about our operational prototype from 2014, "Towards a Peer-to-Peer Bandwidth Marketplace", https://link.springer.com/chapter/10.1007/978-3-642-45249-9_...
It's more then just linking hard-disks. It is really hard to build the incentives and market part. Read for instance about our operational prototype from 2014, "Towards a Peer-to-Peer Bandwidth Marketplace", https://link.springer.com/chapter/10.1007/978-3-642-45249-9_...
So ship the first thing then do the second thing. You get two things from this. First, your storage system gets battle tested. Second, you get the credibility of joining the ranks of those who can actually ship quality software.
Are they not all (bitcoin, eth etc.) ponzi schemes?
You're aware that a Ponzi has a very specific definition, more specific than "scam," correct?
Neither Bitcoin nor Ethereum have a central operator generating returns for older investors by disproportionately funneling revenue paid by new investors to them. When the price rises, new and old investors profit equally. You could use BTC as a currency in a Ponzi, Bitcoin being a Ponzi would be impossible by definition.
Neither Bitcoin nor Ethereum have a central operator generating returns for older investors by disproportionately funneling revenue paid by new investors to them. When the price rises, new and old investors profit equally. You could use BTC as a currency in a Ponzi, Bitcoin being a Ponzi would be impossible by definition.
Ethereum at least acts as a platform for other things so it has utility outside of being currency. Bitcoin definitely feels more like one lately, though.
The thing about them is technically they are not. But - they can be used as schemes. And that's what makes them powerful as schemes - the veneer of credibility that actual bad actors can hide behind. Which taints the good actors.
No, it's a buy the dip scheme.
https://www.youtube.com/watch?v=0akBdQa55b4
https://www.youtube.com/watch?v=0akBdQa55b4
All XXXcoin currencies are Ponzi schemes, in effect. Their "growth" is fueled almost entirely by new investors dumping cash into the system from which no one takes (can take[1]) anything out.
That's a pyramid. Eventually when the investment money runs out[2], the support will fall over. The only distinction between this and a Ponzi scheme is that there are (probably) no single fraudsters at the top ready to run off with the money. It's an unintentional Ponzi scheme.
Coin boosters simply don't get this: there's not enough money in the world to keep bitcoin (and all the copycat coins) growing forever. What is your plan for when the investment money runs out?. There is no plan, because you can't get your money out.
[1] You simply can't dump a large bitcoin holding. There's not nearly enough liquidity to do that in reasonable time.
[2] And it will.
That's a pyramid. Eventually when the investment money runs out[2], the support will fall over. The only distinction between this and a Ponzi scheme is that there are (probably) no single fraudsters at the top ready to run off with the money. It's an unintentional Ponzi scheme.
Coin boosters simply don't get this: there's not enough money in the world to keep bitcoin (and all the copycat coins) growing forever. What is your plan for when the investment money runs out?. There is no plan, because you can't get your money out.
[1] You simply can't dump a large bitcoin holding. There's not nearly enough liquidity to do that in reasonable time.
[2] And it will.
24h volume of bitcoin was 9.8B. Just how big of a holding are you talking about?
What a load of BS. Of course you can sell off a large Bitcoin holding. People do it all the time. That you think otherwise is ignorance and bias.
You can sell as long as people are buying.
That also applies to shares, real estate, apples, Teslas, ...
Yes. I was just stating the obvious, which appeared to be not so obvious to the commenter.
Not sure we should bash that comment. If large means 1 million dollars it isn't hard to find liquidity to sell 100BTC.
Heh.. Yes, probably is now.
I dont know if the founders started out to make a Ponzi, but once the dollars started rolling in, I can imagine, they probably got "different ideas".
Who am I to judge, but if I was a founder of this, I would be driving my Ferrari in Thailand instead of slaving away trying to build some stupid file system. Who the hell cares about file systems :P
I dont know if the founders started out to make a Ponzi, but once the dollars started rolling in, I can imagine, they probably got "different ideas".
Who am I to judge, but if I was a founder of this, I would be driving my Ferrari in Thailand instead of slaving away trying to build some stupid file system. Who the hell cares about file systems :P
Driving ferraris gets old, I'd much prefer to be inventing decentralized file storage.
I agree, but those cars and the attention is just so tempting. And then in Thailand. Imagine kite surfing, drinks, anything you want for small cash. Hell, you could even contract someone to write that damn file system people are whining about.
@jbenet has discussed funding for open source infrastructure in-depth in a YC podcast back in June: https://blog.ycombinator.com/ipfs-coinlist-and-the-filecoin-... (transcript included)
Driving Ferraris... vs. Writing distributed file systems...
One of these sounds much more fun than the other.
Hint: It is not driving Ferraris. ;)
One of these sounds much more fun than the other.
Hint: It is not driving Ferraris. ;)
In the long run, I think driving Ferraris would get old much quicker than writing file systems, so yes, I tend to agreee, but in the short run, I doubt it.. Hell, park a Ferrari in my drive way and I would abandon my customers here for at least 3 days.. :D ... But thats just me..
How is Filecoin fundamentally any different from Bitcoin?
Filecoin gave a deal to their buddies
Bitcoin and Ethereum were premined
Anyone interested in reading the Filecoin offering info you can find it on the CoinList.co site
https://coinlist.co/filecoin
https://coinlist.co/filecoin
I think the top comment for this should be about Filecoin, instead of just another uninformed comments about Bitcoin that we see here every day.
That said, one thing most people don't talk about is: I think most people think IPFS is disruptive, but I think IPFS itself is susceptible to disruption.
The main reason why IPFS is useful is because there's not an easy way to do NAT traversal therefore it's super hard for people to run their own server on their laptop or mobile devices.
IPFS introduces all kinds of technologies to get around this, but in my opinion the ability to freely set up your own server on your device is the core problem.
You don't really need a globally addressable immutable file storage, because unless you're dealing with static images, a lot of files DO change all the time, and people want to store and share files privately.
Which means, if there's a new type of technology that lets people do just that--set up their own server anywhere and make it accessible via HTTP--then I don't see why we really need IPFS. This could be done by startups or other protocols, but even by some innovative ISPs, which decide to change their business model to compete against edge nodes that capture most of the value (such as Google, Facebook, etc.)
In my opinion, the reason IPFS is so hot nowadays is because it's riding the DApps wave where people want to build Ethereum apps with IPFS as a file storage. But after playing around with it a bit I think it's much better at this point to just use Github to host your file and use Ethereum as database because the whole point of immutable apps is in the data and transactions, not in the static files.
But I would love to be corrected. If anyone actually think IPFS is essential to DApps, feel free to correct me and educate me.
That said, one thing most people don't talk about is: I think most people think IPFS is disruptive, but I think IPFS itself is susceptible to disruption.
The main reason why IPFS is useful is because there's not an easy way to do NAT traversal therefore it's super hard for people to run their own server on their laptop or mobile devices.
IPFS introduces all kinds of technologies to get around this, but in my opinion the ability to freely set up your own server on your device is the core problem.
You don't really need a globally addressable immutable file storage, because unless you're dealing with static images, a lot of files DO change all the time, and people want to store and share files privately.
Which means, if there's a new type of technology that lets people do just that--set up their own server anywhere and make it accessible via HTTP--then I don't see why we really need IPFS. This could be done by startups or other protocols, but even by some innovative ISPs, which decide to change their business model to compete against edge nodes that capture most of the value (such as Google, Facebook, etc.)
In my opinion, the reason IPFS is so hot nowadays is because it's riding the DApps wave where people want to build Ethereum apps with IPFS as a file storage. But after playing around with it a bit I think it's much better at this point to just use Github to host your file and use Ethereum as database because the whole point of immutable apps is in the data and transactions, not in the static files.
But I would love to be corrected. If anyone actually think IPFS is essential to DApps, feel free to correct me and educate me.
> Which means, if there's a new type of technology that lets people do just that--set up their own server anywhere and make it accessible via HTTP--then I don't see why we really need IPFS
I have a ton to say here, but I'll keep it to a few point. Tor onion services solve the setup-your-own-server issues, it's just not super easy yet. IPFS is needed regardless, because there is a need to distribute things when your machine isn't up and to solve discovery. What IPFS doesn't have natively is anonymity (tho there are onion transports conforming to libp2p transport iface) and distributed compute, but neither is that important.
I have a ton to say here, but I'll keep it to a few point. Tor onion services solve the setup-your-own-server issues, it's just not super easy yet. IPFS is needed regardless, because there is a need to distribute things when your machine isn't up and to solve discovery. What IPFS doesn't have natively is anonymity (tho there are onion transports conforming to libp2p transport iface) and distributed compute, but neither is that important.
> Tor onion services solve the setup-your-own-server issues, it's just not super easy yet.
Lately I've been trying to make this easier. I developed ormesh (https://github.com/cmars/ormesh) in an attempt to simplify setting up hidden services for private use.
I think both Tor and IPFS are both awesome and useful decentralization projects, they just have different use cases & characteristics. AIUI IPFS lacks fine-grained access controls. Last time I looked, it seemed like I either had to run all my own infrastructure of IPFS nodes with pre-shared private keys, or open everything to the public and encrypt on top of that... I prefer the Tor hidden service model, where I can decide on a per-service basis how I want to share it, revoke client access if necessary, and have my traffic securely routed on existing infrastructure.
Edit: fixed link
Lately I've been trying to make this easier. I developed ormesh (https://github.com/cmars/ormesh) in an attempt to simplify setting up hidden services for private use.
I think both Tor and IPFS are both awesome and useful decentralization projects, they just have different use cases & characteristics. AIUI IPFS lacks fine-grained access controls. Last time I looked, it seemed like I either had to run all my own infrastructure of IPFS nodes with pre-shared private keys, or open everything to the public and encrypt on top of that... I prefer the Tor hidden service model, where I can decide on a per-service basis how I want to share it, revoke client access if necessary, and have my traffic securely routed on existing infrastructure.
Edit: fixed link
Saw this on /r/golang (I was the one asking why the full Tor browser). I have considered similar [0]. A simple service (or portable exe) that has Tor statically linked and lets you reach/manage a machine from anywhere (think webmin-like web console on onion service) would have real value. Of course it can be authenticated and have the option to open direct connection (webrtc?) if you need fast media playing or direct download.
0 - https://github.com/cretz/software-ideas/issues/54
0 - https://github.com/cretz/software-ideas/issues/54
This is my first time discovering IPFS, so pardon if this my question is obvious/addressed elsewhere.
At what point does the "network" become too small. I.e. if your computer can only reach 10,000 devices... are those 10,000 devices supposed to be able to have access to all data for the entire world? (albeit out of date)
The scenario I'm thinking of here is similar to if Alaska suddenly got cut off from the rest of the world for a week, month, year.
At what point does the "network" become too small. I.e. if your computer can only reach 10,000 devices... are those 10,000 devices supposed to be able to have access to all data for the entire world? (albeit out of date)
The scenario I'm thinking of here is similar to if Alaska suddenly got cut off from the rest of the world for a week, month, year.
Weird to see Tor as a connectivity solution. I guess if you really don't care about performance.
At the least it's a good NAT buster for signalling. May be able to piggy back a direct connection off of it (using it for just STUN-like reasons) but of course the increased performance of a direct connection comes at the cost of anonymity.
There are lots of better NAT busters that are way faster and more versatile.
Of course I'm partial because I made one: https://www.zerotier.com/
There are others ways too like libp2p, webrtc, etc.
Tor is an anonymity layer. By definition this requires worst case routing and artificially added latency, since if latency is low you can triangulate. Anonymity and efficient direct connectivity are antagonistic goals in a system.
Of course I'm partial because I made one: https://www.zerotier.com/
There are others ways too like libp2p, webrtc, etc.
Tor is an anonymity layer. By definition this requires worst case routing and artificially added latency, since if latency is low you can triangulate. Anonymity and efficient direct connectivity are antagonistic goals in a system.
More of an addendum than a correction, the Akasha project is an ETH & IPFS project that looks interesting
https://akasha.world/
What can you do with Akasha from the FAQ "You can publish, share and vote for entries, similar to Medium and other modern publishing platforms, with the difference that your content is actually published over a decentralized network rather than on our servers."
What can you do with Akasha from the FAQ "You can publish, share and vote for entries, similar to Medium and other modern publishing platforms, with the difference that your content is actually published over a decentralized network rather than on our servers."
Blog-ish websites are unreliable even when they have real hosting. If you put it on someone's laptop it gets so much worse. To me, the reliability boost is the killer feature of IPFS.
> You don't really need a globally addressable immutable file storage, because unless you're dealing with static images, a lot of files DO change all the time, and people want to store and share files privately.
While it boosts reliability, IPFS is not globally immutable. If you share a file with a limited scope, it won't stick around forever.
Though from a quick search you can't easily keep a file private, that's not great.
> You don't really need a globally addressable immutable file storage, because unless you're dealing with static images, a lot of files DO change all the time, and people want to store and share files privately.
While it boosts reliability, IPFS is not globally immutable. If you share a file with a limited scope, it won't stick around forever.
Though from a quick search you can't easily keep a file private, that's not great.
you can just store an encrypted file or archive
You can, but the whole thing is built on ease of use, and you don't get ease of use if you have to manually encrypt your selfies.
In a forward-secure manner?
If your app is hosted on github, it is not really distributed. And Ethereum is extremely limited as a database.
Exactly, IPFS allows data storage and retrieval for Dapps to also be done through a decentralized network. That's the whole point of a D-app, not falling back on someone's central servers. The performance and scalability limitations of Ethereum make it virtually unusable as a database, application data definitely needs to be taken off-chain.
Also, the IPFS system contains IPNS, which allows users to host mutable content. Rather than navigating to the hash of a file, you're retrieving what's been signed by the publisher's key. So it's more flexible than just static content.
Also, the IPFS system contains IPNS, which allows users to host mutable content. Rather than navigating to the hash of a file, you're retrieving what's been signed by the publisher's key. So it's more flexible than just static content.
Just to be clear, this is exactly what I thought when I first started working on DApps. But the more I get into it the more I realize there's a blurry line in there a lot of people don't even think about.
I know it's cool to build completely decentralized apps, but let's ask WHY you're trying to build a completely decentralized app.
Chances are you're trying to make sure that what users do on the app is never censorable.
If you're trying to build a decentralized app where EVEYRY asset must be unstoppable, then you need IPFS. For example million dollar homepage kind of app.
But I think those are niche cases and for most decentralized apps, the more important part is the actual transaction ledger. I don't really care if my profile image next to my transaction history stays on IPFS forever, in fact I don't want it to be permanent. I would rather have it be deletable if I wanted to. All I care about is that I own certain asset or have control over certain actions through my private key.
I think a lot of DApp developers are missing the point in this regard, trying so hard to make everything "100% decentralized" for the sake of being decentralized, while sacrificing user experience, not to mention the fact that users may actually NOT want their assets to be permanent (they only care about transaction being permanent).
Yes I know what IPNS is, but I think by now you get my point. It's not about being able to have an address to refer to multiple versions, but the question about "do users want immutability for that?"
I know it's cool to build completely decentralized apps, but let's ask WHY you're trying to build a completely decentralized app.
Chances are you're trying to make sure that what users do on the app is never censorable.
If you're trying to build a decentralized app where EVEYRY asset must be unstoppable, then you need IPFS. For example million dollar homepage kind of app.
But I think those are niche cases and for most decentralized apps, the more important part is the actual transaction ledger. I don't really care if my profile image next to my transaction history stays on IPFS forever, in fact I don't want it to be permanent. I would rather have it be deletable if I wanted to. All I care about is that I own certain asset or have control over certain actions through my private key.
I think a lot of DApp developers are missing the point in this regard, trying so hard to make everything "100% decentralized" for the sake of being decentralized, while sacrificing user experience, not to mention the fact that users may actually NOT want their assets to be permanent (they only care about transaction being permanent).
Yes I know what IPNS is, but I think by now you get my point. It's not about being able to have an address to refer to multiple versions, but the question about "do users want immutability for that?"
Most people don't want their own server. Consider the person whose only computer is a phone. (That's, for example, most people in Japan; most people in the West under 15; etc.) Do they want to serve documents from their phone? No, because their phone doesn't have an always-on high-upload-bandwidth internet connection!
Only certain computers make good servers. It's more likely that everyone will get an automatic slice of a good server somewhere (i.e. the ISP-hosted "cloudlets" concept—your phone can launch edge-hosted VMs as if they were threads) than that people will suddenly, after all this time, start wanting to host things directly on their crap low-availability hardware.
Only certain computers make good servers. It's more likely that everyone will get an automatic slice of a good server somewhere (i.e. the ISP-hosted "cloudlets" concept—your phone can launch edge-hosted VMs as if they were threads) than that people will suddenly, after all this time, start wanting to host things directly on their crap low-availability hardware.
> Most people don't want their own server.
Yes and No.
It is true people don't want their own server because it's too much hassle to set up and maintain, with not much upside.
But we've never actually experienced this so nobody really knows whether people will want this or not. Nobody knew we needed a touch screen phone that works as a computer either. You can only tell AFTER such a thing becomes available.
> No, because their phone doesn't have an always-on high-upload-bandwidth internet connection!
This is exactly the infrastructure problem I was talking about. It has nothing to do with the hardware ability itself. In case you're still thinking your iPhone is a crappy computer, No, the iPhone in your pocket is already performant enough to function as a full fledged server. It's the network that doesn't support it.
> It's more likely that everyone will get an automatic slice of a good server somewhere
Unless this comes as completely free AND it comes built into the device, people won't likely jump onto using something like this because there are free alternatives.
If you think about it, every iPhone user owns their "own cloud" (iCloud). This was unthinkable several years ago. Same thing may happen when people can have servers running on their own devices.
My point was, if the infrastructure can evolve to match the type of things devices can already do, all mobile devices will suddenly turn into p2p devices overnight. And a lot of powerful things can happen.
Yes and No.
It is true people don't want their own server because it's too much hassle to set up and maintain, with not much upside.
But we've never actually experienced this so nobody really knows whether people will want this or not. Nobody knew we needed a touch screen phone that works as a computer either. You can only tell AFTER such a thing becomes available.
> No, because their phone doesn't have an always-on high-upload-bandwidth internet connection!
This is exactly the infrastructure problem I was talking about. It has nothing to do with the hardware ability itself. In case you're still thinking your iPhone is a crappy computer, No, the iPhone in your pocket is already performant enough to function as a full fledged server. It's the network that doesn't support it.
> It's more likely that everyone will get an automatic slice of a good server somewhere
Unless this comes as completely free AND it comes built into the device, people won't likely jump onto using something like this because there are free alternatives.
If you think about it, every iPhone user owns their "own cloud" (iCloud). This was unthinkable several years ago. Same thing may happen when people can have servers running on their own devices.
My point was, if the infrastructure can evolve to match the type of things devices can already do, all mobile devices will suddenly turn into p2p devices overnight. And a lot of powerful things can happen.
> In case you're still thinking your iPhone is a crappy computer, No, the iPhone in your pocket is already performant enough to function as a full fledged server. It's the network that doesn't support it.
A crappy computer, no; a crappy server, yes. The available network is part of a server. A URL that points to a machine that can't be accessed whenever the owner goes into a tunnel, is a URL nobody will link to.
(Another part of the evaluation of "a server" is the available concurrent I/O throughput. There is a reason the term "slashdotted" exists, and thinking an iPhone—or even a home PC—makes a good server for serving anything with any exponential-interest-curve potential is it. This is also the reason why nobody has built the sequel to Iridium using cube-sats.)
> Unless this comes as completely free AND it comes built into the device
Yes, that's exactly the future that cloudlet advocates like IBM are talking about:
1. the ISPs run compute clusters at the edge, including both setting up traditional co-los, and making their in-home gateway modems into compute hosts as well;
2. the device/"cloud" providers (Apple, Google, etc.) make agreements with said ISPs to pay for time on those edge-clouds;
3. the device/"cloud" providers resell (possibly at a loss, to encourage lock-in) the use of the aggregate edge-cloud to the app developers on their platforms; or, they let developers use the edge-cloud in their apps for free, and pass the costs onto only heavy users, the same way they do with document storage today;
4. the users of these devices suddenly have cloudlet-enabled apps, and most don't have to pay a cent more.
Amusingly, you can already see that the device/"cloud" providers are trying to short-circuit this whole process, skipping the ISP step, by simply selling people consumer-electronics devices that could sit in their homes, connected to ZeroTier-like overlay networks, hosting mobile cloudlets. You know, like the Google Home and Amazon Echo.
A crappy computer, no; a crappy server, yes. The available network is part of a server. A URL that points to a machine that can't be accessed whenever the owner goes into a tunnel, is a URL nobody will link to.
(Another part of the evaluation of "a server" is the available concurrent I/O throughput. There is a reason the term "slashdotted" exists, and thinking an iPhone—or even a home PC—makes a good server for serving anything with any exponential-interest-curve potential is it. This is also the reason why nobody has built the sequel to Iridium using cube-sats.)
> Unless this comes as completely free AND it comes built into the device
Yes, that's exactly the future that cloudlet advocates like IBM are talking about:
1. the ISPs run compute clusters at the edge, including both setting up traditional co-los, and making their in-home gateway modems into compute hosts as well;
2. the device/"cloud" providers (Apple, Google, etc.) make agreements with said ISPs to pay for time on those edge-clouds;
3. the device/"cloud" providers resell (possibly at a loss, to encourage lock-in) the use of the aggregate edge-cloud to the app developers on their platforms; or, they let developers use the edge-cloud in their apps for free, and pass the costs onto only heavy users, the same way they do with document storage today;
4. the users of these devices suddenly have cloudlet-enabled apps, and most don't have to pay a cent more.
Amusingly, you can already see that the device/"cloud" providers are trying to short-circuit this whole process, skipping the ISP step, by simply selling people consumer-electronics devices that could sit in their homes, connected to ZeroTier-like overlay networks, hosting mobile cloudlets. You know, like the Google Home and Amazon Echo.
> A crappy computer, no; a crappy server, yes. The available network is part of a server. A URL that points to a machine that can't be accessed whenever the owner goes into a tunnel, is a URL nobody will link to.
This is one of the very points that IPFS tries to address: decoupling content from location, so that additional copies of the same content in different locations of the network can actually strengthen the content's availability, instead of being non-addressable and thus wasted.
This is one of the very points that IPFS tries to address: decoupling content from location, so that additional copies of the same content in different locations of the network can actually strengthen the content's availability, instead of being non-addressable and thus wasted.
Works if you're serving a static webpage; doesn't work if you're serving, say, a private chatroom. This is what decentralized execution environments like Ethereum seek to solve, but running an Ethereum node on your phone is not the same thing as actually serving a private chatroom from your phone. In fact, Ethereum is much closer to the cloudlet side of the spectrum of solutions, insofar as your client (the phone) is just sending commands to a computer "somewhere else" (in this case, ~everywhere) that then acts as the server.
Works with IPFS if you use Pubsub, cryptographic capabilities, and CRDTs :) Check out PeerPad: https://peerpad.net
edit: what I also meant to say is, a chat room doesn't need computation (although there certainly use cases that do)
edit: what I also meant to say is, a chat room doesn't need computation (although there certainly use cases that do)
[deleted]
I see a lot of people here making the mistake of thinking that IPFS is a file storage system that splits up content among a decentralized, shared network when it's not.
If I have a file and "store" it on IPFS - that file sits on my own machine indefinitely. You would think that a project called “Interplanetary File System” would be able to store some data... but nope. Instead, files in IPFS are only ever distributed to other hosts if they express interest in that content, and they are mirrored only if their clients have been setup to seed that content.
IPFS in that sense is more like Bittorrent in that it doesn't magically guarantee data will be available. That is the reason why you see so many “decentralized” systems using IPFS that suck. Because the moment data is “stored” in Interplanetary “File System”, the user thinks they can close the application and the data will still be there.... Guess why there are so many stores on OpenBazaar that are inaccessible at the moment ;)
The reason why so many Ethereum developers are using IPFS is because these developers typically have no clue what they're doing. They're the kind of developers whose introduction to blockchains came in the form of an artificially-imposed toy sandpit and now they think that blockchain engineering consists of being able to build towers out of blocks built by other people. They cannot build anything new for themselves, and if they understood how any of the existing components worked they probably wouldn't use them... But they don't.
After doing some tests, IPFS seems to run their own caching servers that automatically cache content retrieved from the network via their servers. So I am guessing that “dapp developers” are “optimizing” their code to use these servers, or are making requests to these servers in tests and then assuming that IPFS is a magic data store that gives them infinite decentralized, scalable storage space for no cost.... I mean, economically that is already impossible. But even if it could technically do that, ask yourself what Filecoin is suppose to be for?
On the topic of Filecoin, it's a complete disaster and the paper linked in the OP doesn't cover any of the main technical problems. What this paper fails to address is how unreliable time-lock encryption is as a timing function for anything given that its impossible to know how much serial computational power an attacker has available. That already defeats most of the claims made around Filecoin's absurdly inefficient and impossible to verify “proof-of-spacetime” algorithm.
The other thing that none of these papers addresses is how an auction market is fundamentally at odds to the needs of a cryptoeconomic system. The problem is that with no way to regulate the supply of storage space, it naturally leads to more people wanting to sell what they have then there is demand for it (which will crash the price of the storage space.)
If hosts cannot remain profitable by playing fairly then the only option left is to cheat. This is actually the opposite to how blockchains work as they strictly control the supply to maintain a healthy security-cost ratio (technically there is only ever 1 Bitcoin whose scarcity is maintained via a growing proof-of-work. The “bit” comes from the virtually fragmented sub-coins, but there is only ever 1 Bitcoin.)
Tl; dr: Interplanetary File System can only do distribution and cannot actually store files; And Filecoin isn't really a coin at all since the supply is indeterminate and it functions more like an exchange for contracts than a currency. The Protocol Lab guys sure know how to bullshit people though, I'll give them that much.
IPFS in that sense is more like Bittorrent in that it doesn't magically guarantee data will be available. That is the reason why you see so many “decentralized” systems using IPFS that suck. Because the moment data is “stored” in Interplanetary “File System”, the user thinks they can close the application and the data will still be there.... Guess why there are so many stores on OpenBazaar that are inaccessible at the moment ;)
The reason why so many Ethereum developers are using IPFS is because these developers typically have no clue what they're doing. They're the kind of developers whose introduction to blockchains came in the form of an artificially-imposed toy sandpit and now they think that blockchain engineering consists of being able to build towers out of blocks built by other people. They cannot build anything new for themselves, and if they understood how any of the existing components worked they probably wouldn't use them... But they don't.
After doing some tests, IPFS seems to run their own caching servers that automatically cache content retrieved from the network via their servers. So I am guessing that “dapp developers” are “optimizing” their code to use these servers, or are making requests to these servers in tests and then assuming that IPFS is a magic data store that gives them infinite decentralized, scalable storage space for no cost.... I mean, economically that is already impossible. But even if it could technically do that, ask yourself what Filecoin is suppose to be for?
On the topic of Filecoin, it's a complete disaster and the paper linked in the OP doesn't cover any of the main technical problems. What this paper fails to address is how unreliable time-lock encryption is as a timing function for anything given that its impossible to know how much serial computational power an attacker has available. That already defeats most of the claims made around Filecoin's absurdly inefficient and impossible to verify “proof-of-spacetime” algorithm.
The other thing that none of these papers addresses is how an auction market is fundamentally at odds to the needs of a cryptoeconomic system. The problem is that with no way to regulate the supply of storage space, it naturally leads to more people wanting to sell what they have then there is demand for it (which will crash the price of the storage space.)
If hosts cannot remain profitable by playing fairly then the only option left is to cheat. This is actually the opposite to how blockchains work as they strictly control the supply to maintain a healthy security-cost ratio (technically there is only ever 1 Bitcoin whose scarcity is maintained via a growing proof-of-work. The “bit” comes from the virtually fragmented sub-coins, but there is only ever 1 Bitcoin.)
Tl; dr: Interplanetary File System can only do distribution and cannot actually store files; And Filecoin isn't really a coin at all since the supply is indeterminate and it functions more like an exchange for contracts than a currency. The Protocol Lab guys sure know how to bullshit people though, I'll give them that much.
> if there's a new type of technology that lets people do just that--set up their own server anywhere and make it accessible via HTTP--then I don't see why we really need IPFS
> In my opinion, the reason IPFS is so hot nowadays is because it's riding the DApps wave where people want to build Ethereum apps with IPFS as a file storage.
Whilst I enjoy reading and learning about dapps, blockchains, etc. they seem very niche at this point: it can be argued whether or not bitcoin is "mainstream" (many have heard of it, but how many have or use it, compared to e.g. bank accounts), but ethereum is even more niche in comparison; using dapps is presumably rather niche even in the ethereum world, compared to those simply speculating on ether or making pump-and-dump ICOs; those building dapps would be even more niche; those building dapps with IPFS for distributed file storage would be a niche part of that.
I don't think this is what's driving IPFS.
However, I do come across many potential uses of IPFS every day.
Whenever I see a broken link, especially for some old informational site or tarball or whatever, and Googling for an alternative link just brings up more and more of the same broken link, it makes me wish IPFS were around (most recent example: http://easyldap.exofire.net/files/installer/easyldap-install... )
Likewise, whenever I find myself writing a URL into a file, e.g. a source tarball for a Linux package, I want to use an IPFS hash instead (IPFS is hopefully coming to Nix at some point https://github.com/NixOS/nix/issues/859 ).
In the latter case, I could add these files to IPFS myself, but I'd probably be the only one using it, and I'm usually less reliable than those canonical HTTP URLs, so those hashes would likely disappear sooner than the HTTP ones.
I have high hopes for IPFS. At one point I thought magnet URLs might solve this. I was pleased when kio-magnet allowed KDE to browse Web sites via magnet links, but even the blog post announcing that seems to be no more :( https://www.reddit.com/r/linux/comments/ew0y4/kiomagnet_what...
> In my opinion, the reason IPFS is so hot nowadays is because it's riding the DApps wave where people want to build Ethereum apps with IPFS as a file storage.
Whilst I enjoy reading and learning about dapps, blockchains, etc. they seem very niche at this point: it can be argued whether or not bitcoin is "mainstream" (many have heard of it, but how many have or use it, compared to e.g. bank accounts), but ethereum is even more niche in comparison; using dapps is presumably rather niche even in the ethereum world, compared to those simply speculating on ether or making pump-and-dump ICOs; those building dapps would be even more niche; those building dapps with IPFS for distributed file storage would be a niche part of that.
I don't think this is what's driving IPFS.
However, I do come across many potential uses of IPFS every day.
Whenever I see a broken link, especially for some old informational site or tarball or whatever, and Googling for an alternative link just brings up more and more of the same broken link, it makes me wish IPFS were around (most recent example: http://easyldap.exofire.net/files/installer/easyldap-install... )
Likewise, whenever I find myself writing a URL into a file, e.g. a source tarball for a Linux package, I want to use an IPFS hash instead (IPFS is hopefully coming to Nix at some point https://github.com/NixOS/nix/issues/859 ).
In the latter case, I could add these files to IPFS myself, but I'd probably be the only one using it, and I'm usually less reliable than those canonical HTTP URLs, so those hashes would likely disappear sooner than the HTTP ones.
I have high hopes for IPFS. At one point I thought magnet URLs might solve this. I was pleased when kio-magnet allowed KDE to browse Web sites via magnet links, but even the blog post announcing that seems to be no more :( https://www.reddit.com/r/linux/comments/ew0y4/kiomagnet_what...
I met Juan back in 2014, where us (Feross, Substack, Max Ogden, Mafintosh, and others) all showed off our P2P projects. How times have changed since then!
I can attest to the usefulness of Filecoin. But I do think you are right in that IPFS is for immutable file/asset storage, and not as efficient for mutable data. David, one of the core teams at IPFS, reached out to me the other week about how CRDTs on top of IPFS can fix that. That is what we have solved, mutable graph data that can update in realtime or offline, across a ad-hoc mesh network.
IPFS is still critical here though, because using our Radix Storage Engine (just released) adapter, we can batch high volume mutable data to disk (aka IPFS) for storage and retrieval, which once fetched gun kicks back into gear and does sync.
Ethereum is just not at this scale yet, last I heard it was doing about 7 transactions per second (and Bitcoin doing 4). We're doing 2K end-to-end (across a 4 peer network hop) table inserts/second! I demo this on stage here: https://youtu.be/nTbUCTgLmkY
In that talk, I also explain how to do load testing across a distributed system in order to verify its correctness, aka do simulations on failures like with Kyle Kingsbury's (Aphyr) Jepsen Tests.
So while Filecoin isn't ready yet, its market cap represents a massive emerging opportunity. If Uber unicorn-ed crowdsourced transportation, imagine what a truly P2P incentivized crowdsourced storage system could do. Remember, all machines need electricity (Bitcoin), computation (Ethereum), storage (filecoin), and bandwidth (what we're tackling, with data sync, and incentives).
If you look at it in that context, it makes sense. Hopefully the crypto-P2P community will deliver :) to keep up with the demand. Cheers!
I can attest to the usefulness of Filecoin. But I do think you are right in that IPFS is for immutable file/asset storage, and not as efficient for mutable data. David, one of the core teams at IPFS, reached out to me the other week about how CRDTs on top of IPFS can fix that. That is what we have solved, mutable graph data that can update in realtime or offline, across a ad-hoc mesh network.
IPFS is still critical here though, because using our Radix Storage Engine (just released) adapter, we can batch high volume mutable data to disk (aka IPFS) for storage and retrieval, which once fetched gun kicks back into gear and does sync.
Ethereum is just not at this scale yet, last I heard it was doing about 7 transactions per second (and Bitcoin doing 4). We're doing 2K end-to-end (across a 4 peer network hop) table inserts/second! I demo this on stage here: https://youtu.be/nTbUCTgLmkY
In that talk, I also explain how to do load testing across a distributed system in order to verify its correctness, aka do simulations on failures like with Kyle Kingsbury's (Aphyr) Jepsen Tests.
So while Filecoin isn't ready yet, its market cap represents a massive emerging opportunity. If Uber unicorn-ed crowdsourced transportation, imagine what a truly P2P incentivized crowdsourced storage system could do. Remember, all machines need electricity (Bitcoin), computation (Ethereum), storage (filecoin), and bandwidth (what we're tackling, with data sync, and incentives).
If you look at it in that context, it makes sense. Hopefully the crypto-P2P community will deliver :) to keep up with the demand. Cheers!
Looking at my dropbox, <1% of files have been updated in the past year. So your premise that a lot of files change over time may not be correct.
Also, you started by warning against uninformed comments about BTC but your comment on FC seems uninformed itself - especially the last 2 paragraphs which go into hardcore speculation category.
Also, you started by warning against uninformed comments about BTC but your comment on FC seems uninformed itself - especially the last 2 paragraphs which go into hardcore speculation category.
Feel free to tell me what I got wrong then. There's a difference between informed speculation and uninformed. Uninformed speculators draw conclusions from what they heard elsewhere. I tend to think I drew the conclusion as independently as I can.
I've thought a lot about this problem so I don't think I'm uninformed about this matter. This is not to say I'm right, and as I mentioned, I would love to be corrected, which was the reason why I posted the comment to begin with.
But just saying "you're uninformed yourself" doesn't help anyone.
Also I said:
> a lot of files DO change all the time, and people want to store and share files privately.
Unless you really think IPFS should be compared to Dropbox, your comment about your dropbox usage is irrelevant to this thread. I'll assume that you are aware IPFS is completely public by default and dropbox is for private usage by default (although you could use it for public sharing, it's not the intended usage for dropbox). The closest you can compare IPFS to is on S3 level, not dropbox level.
I've thought a lot about this problem so I don't think I'm uninformed about this matter. This is not to say I'm right, and as I mentioned, I would love to be corrected, which was the reason why I posted the comment to begin with.
But just saying "you're uninformed yourself" doesn't help anyone.
Also I said:
> a lot of files DO change all the time, and people want to store and share files privately.
Unless you really think IPFS should be compared to Dropbox, your comment about your dropbox usage is irrelevant to this thread. I'll assume that you are aware IPFS is completely public by default and dropbox is for private usage by default (although you could use it for public sharing, it's not the intended usage for dropbox). The closest you can compare IPFS to is on S3 level, not dropbox level.
Why do they need their own server? What's wrong with Dropbox, Google Drive, et al? Or, what's wrong with the network drives from Seagate and WD that will let you access those files remotely (aside from the fact that they do cost money)?
It's pretty frustrating to see something that has an easily accessible value (M MBs stored for N seconds consuming X bandwidth) is denominated in the same way that all the other cryptocurrencies are denominated in, as a deflationary good that encourages speculation. If you want to create some token that scale with the value of the system, that's fine, but don't force your users to price their contacts in something that is untethered from the thing they are trying to buy.
What I'd do instead is allow people to store random data to mint new MBseconds at a fractional rate and then the cost of a new contract is trivial. If you want someone to store 1GB for a day the cost of that is well known. The price of storage constantly drops, but the price of a deflationary good that is actually desired will continue to rise. This encurages contact churn.
If you want to have a token that scales with the value of the network/product then just create tokens that generate MBseconds proportional to the fees paid.
What I'd do instead is allow people to store random data to mint new MBseconds at a fractional rate and then the cost of a new contract is trivial. If you want someone to store 1GB for a day the cost of that is well known. The price of storage constantly drops, but the price of a deflationary good that is actually desired will continue to rise. This encurages contact churn.
If you want to have a token that scales with the value of the network/product then just create tokens that generate MBseconds proportional to the fees paid.
Hey HN, this is jbenet -- an author of Filecoin.
We think it's great that people ask hard questions, and get involved. It's great to see others studying our work and we really appreciate the open discourse. There are a few things from this article I’d like to address. (Despite the length of this post...) these are quick comments, and not a proper in-depth response.
- (a) The article gets some things right and some things wrong -- there is good summarizing of several of our projects, and discussion of many difficult aspects in these projects. The article discusses many technological aspects in good depth, and highlights difficulties in building these systems, aligning incentives, and the trials of past projects. The article also has significant inaccuracies. For example, the sale figure -- which appears in the title and impacts the analysis -- is incorrect. We raised $205M -- officially here: https://protocol.ai/blog/filecoin-sale-completed/
- (b) The authors chose a provocative title. As some commenters have already pointed out, the conclusion is “[we] believe that it is not one.” Despite Betteridge’s law ( https://en.wikipedia.org/wiki/Betteridge's_law_of_headlines ), many people who only read the headline will come to the opposite conclusion, and now we (not they) will have the burden of correcting those misunderstandings. Provocative titles, though they may drive imagination and clicks, can do a huge disservice to everyone in the space, and contribute to misinformation. Most people will only read the title, maybe the abstract, and use that to form and drive opinions. We choose titles of our research with diligence and care, and hope others do the same.
- (c) The article has a great technical overview of the Filecoin stack, and how it fits with IPFS and libp2p. This is a large structure with many pieces, and it is rare to see articles grasping how all the pieces fit together so well, and then explaining it cogently. In particular, it’s great to see this article diving deep and discussing advantages and disadvantages of low level technical structures (multihash, ipld, libp2p, and more). We modularized everything in the hope to generally improve peer-to-peer systems, and improve reusability. We hope these components will be useful to the author’s Tribler project (a network similar in goals to Filecoin), and we hope that we can also learn from and leverage solutions they have made.
- (d) many of the objectionable things described in this article are common in ICOs in general. Put another way, consider those claims also in terms of other significant token sales, such as Ethereum, Tezos, Polkadot, Blockstack, Cosmos, Golem. People were saying similar things about Ethereum when they did their sale in 2014. Perhaps worth doing a survey / analysis over all of them, comparing and contrasting the different things groups have done, how the ecosystem has improved, and suggest new directions.
- (e) It’s worth mentioning that the analysis gives a definition of a ponzi scheme, but their discussion does not map to that definition. Instead, the discussion centers on claims about future investor sentiment or speculation as the driver of value in the token, which is not the only way to establish value in token networks, and ignores the value of the services provided. That kind of analysis does not work for projects like Ethereum and other live and functioning crypto tokens. If the network is useful, and there is a way to generate or introduce value, by providing new or better services, and if the network can capture that value in the token itself (important step), then the tokens can hold value, based on the utility of the network as a service and not just or primarily speculation. Networks like Ethereum, Bitcoin, Zcash, and Filecoin aim to provide useful services, and much of the value stored in their tokens will be thanks to the utility of the networks.
Perhaps it’s worth pointing out that most crypto token projects are compared to ponzi schemes at some point :(
- (g) We do share the legitimate concern that ICOs need stronger accountability, and some are structured in a way that leads to abuse. The community as a whole needs to raise the bar on accountability and ethical behavior. We have taken significant steps in this direction, not just in our sale but to improve the ecosystem -- the SAFT project, which was a gargantuan undertaking that many other networks are now using, is one example. Many other networks are introducing and improving structures. We believe token networks present a very important new way to form capital, with promising advantages to users, investors, and creators, but the space is still in its infancy, and significant changes are still ahead. Token sales have improved dramatically in the last three years, and we hope they continue to improve to find the right balance and protection of the interests of all parties involved with the network.
Thanks, Juan
We think it's great that people ask hard questions, and get involved. It's great to see others studying our work and we really appreciate the open discourse. There are a few things from this article I’d like to address. (Despite the length of this post...) these are quick comments, and not a proper in-depth response.
- (a) The article gets some things right and some things wrong -- there is good summarizing of several of our projects, and discussion of many difficult aspects in these projects. The article discusses many technological aspects in good depth, and highlights difficulties in building these systems, aligning incentives, and the trials of past projects. The article also has significant inaccuracies. For example, the sale figure -- which appears in the title and impacts the analysis -- is incorrect. We raised $205M -- officially here: https://protocol.ai/blog/filecoin-sale-completed/
- (b) The authors chose a provocative title. As some commenters have already pointed out, the conclusion is “[we] believe that it is not one.” Despite Betteridge’s law ( https://en.wikipedia.org/wiki/Betteridge's_law_of_headlines ), many people who only read the headline will come to the opposite conclusion, and now we (not they) will have the burden of correcting those misunderstandings. Provocative titles, though they may drive imagination and clicks, can do a huge disservice to everyone in the space, and contribute to misinformation. Most people will only read the title, maybe the abstract, and use that to form and drive opinions. We choose titles of our research with diligence and care, and hope others do the same.
- (c) The article has a great technical overview of the Filecoin stack, and how it fits with IPFS and libp2p. This is a large structure with many pieces, and it is rare to see articles grasping how all the pieces fit together so well, and then explaining it cogently. In particular, it’s great to see this article diving deep and discussing advantages and disadvantages of low level technical structures (multihash, ipld, libp2p, and more). We modularized everything in the hope to generally improve peer-to-peer systems, and improve reusability. We hope these components will be useful to the author’s Tribler project (a network similar in goals to Filecoin), and we hope that we can also learn from and leverage solutions they have made.
- (d) many of the objectionable things described in this article are common in ICOs in general. Put another way, consider those claims also in terms of other significant token sales, such as Ethereum, Tezos, Polkadot, Blockstack, Cosmos, Golem. People were saying similar things about Ethereum when they did their sale in 2014. Perhaps worth doing a survey / analysis over all of them, comparing and contrasting the different things groups have done, how the ecosystem has improved, and suggest new directions.
- (e) It’s worth mentioning that the analysis gives a definition of a ponzi scheme, but their discussion does not map to that definition. Instead, the discussion centers on claims about future investor sentiment or speculation as the driver of value in the token, which is not the only way to establish value in token networks, and ignores the value of the services provided. That kind of analysis does not work for projects like Ethereum and other live and functioning crypto tokens. If the network is useful, and there is a way to generate or introduce value, by providing new or better services, and if the network can capture that value in the token itself (important step), then the tokens can hold value, based on the utility of the network as a service and not just or primarily speculation. Networks like Ethereum, Bitcoin, Zcash, and Filecoin aim to provide useful services, and much of the value stored in their tokens will be thanks to the utility of the networks.
Perhaps it’s worth pointing out that most crypto token projects are compared to ponzi schemes at some point :(
- http://www.google.com/search?q=is+bitcoin+a+ponzi+scheme
- http://www.google.com/search?q=is+ethereum+a+ponzi+scheme
- http://www.google.com/search?q=is+zcash+a+ponzi+scheme
- http://www.google.com/search?q=is+tezos+a+ponzi+scheme
- (g) We do share the legitimate concern that ICOs need stronger accountability, and some are structured in a way that leads to abuse. The community as a whole needs to raise the bar on accountability and ethical behavior. We have taken significant steps in this direction, not just in our sale but to improve the ecosystem -- the SAFT project, which was a gargantuan undertaking that many other networks are now using, is one example. Many other networks are introducing and improving structures. We believe token networks present a very important new way to form capital, with promising advantages to users, investors, and creators, but the space is still in its infancy, and significant changes are still ahead. Token sales have improved dramatically in the last three years, and we hope they continue to improve to find the right balance and protection of the interests of all parties involved with the network.
Thanks, Juan
y'all are forgetting that juan is a genius and still alive...
To me, IPFS aims to solve a completely different problem. IPFS does not exist because we don't have means to host and distribute files - that is a problem solved by a hundred different entities. IPFS, as advertised in many mediums (video/etc), is a platform to distribute data from a local-first P2P medium. Like Bittorrent, but without ever leaving the local network/etc. Eg, transferring a file/video/site to someone next to you would not download the data from across the world twice.
Has the marketing changed? Because all of the videos I watched on it from months ago were all about reducing global bandwidth usage, utilizing local and distributed sources of the data as much possible.
Why is everyone acting like IPFS is trying to solve file hosting?