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Kindle Notes & Highlights
by
David Gerard
Read between
July 24 - July 26, 2017
When phrases like “a whole new form of money” or “the old rules don’t apply any more” start going around, people get gullible and the ethically-challenged get creative.
The 3.3 sextillion calculations are thrown away, because the only point of all this technical rigmarole is to show that you can waste electricity faster than everyone else.
Obviously, the competition gets viciously Darwinian very quickly.
Libertarianism is a simple idea: freedom is good and government is bad.
Silicon Valley has always been a cross of the hippie counterculture and Ayn Rand-based libertarianism (this cross being termed the “Californian ideology”).
Bitcoin ideology bought into the entire Federal Reserve conspiracy package.
all of this is based in crank ideas that don’t work.
Proponents of Austrian economics include the fringe economics blog Zero Hedge, which has confidently predicted two hundred of the last two recessions.
Advocates claim all manner of practical use cases for Bitcoin. A lot of the claims contradict each other, and indeed the actual software; others merely run aground on reality.
Bitcoin was widely touted early on as anonymous – on the blockchain, nobody knows you’re a dog.
Many crypto scams are quite complex; some are simpler than you might expect. Many are everyday dodgy investment opportunities but with Bitcoin. It can be difficult to distinguish malice from incompetence.
Bitcoin exchanges were started by amateur enthusiasts. Most were computer programmers whose approach to anything outside their field was “I know PHP, how hard could running an exchange be?” As Dunning and Kruger pointed out in 1999,79 this approach tends not to work out so well.
In real securities trading, you can presume the exchanges themselves are not going to mess you around, and indeed that they’re basically competent. You can’t assume either with crypto exchanges.
As of March 2015, a full third of all Bitcoin exchanges up to then had been hacked, and nearly half had closed.
To be fair, conventional banks say “Yes, Mr. Smith, I’m sorry, but it seems we misplaced all your money irretrievably. Yes, yours in particular. It’s gone. Forever. No, I’m sorry, but we aren’t liable. Have a nice day!” all the time. No wait, they don’t do anything of the sort.
the first known e-commerce was the sale of marijuana between Stanford and MIT students over email in 1971 or 1972.109
If only the prosecutors had had to hand some sort of cryptographically robust ledger of all transactions, widely distributed, with thousands of verifiable copies available.
The software problems were glossed over for years, because day traders are otherwise known as compulsive gamblers, and crypto day traders make foreign exchange day traders look sober, considered and balanced.
It came out in May 2017 that the operator of the Dogecoin tipping bot on Reddit had stolen all the deposited Dogecoins two years earlier.294 Much sorry, many loss.
If Bitcoin is like an Excel spreadsheet, then Ethereum is like a spreadsheet with macros.
So if you secretly had a quantum computer, you could mine a bit faster, or you could just steal everyone else’s bitcoins.
The idea is to replace the messy uncertainty and hierarchy of conventional human-mediated legal agreements with the clear, deterministic rigour of computer code, immune to human interference, in order to make business and the law more predictable and effective. This is a bad idea in every way.
And imagine your money working as reliably as your PC.
It was the most prominent smart contract of all time, achieving considerable mainstream press coverage. It proceeded to illustrate just about every potential issue that has ever been raised with smart contracts.
Apologists note that The DAO was just an experiment (a $150 million “experiment”) to answer the question: can we have a workable decentralized autonomous organization, running on smart contracts, with no human intervention? And it answered it: no, probably not.
The good bits of blockchain are not original, and the original bits of blockchain turn out not to be much good.
Business Blockchain marketing claims are rarely this grounded, however. They’re largely divorced from tawdry considerations of technical or economic feasibility, mathematical coherency or logical consistency.
Hyperledger.org is a corporate open source Potemkin village of the sort IBM has long favoured: the illusion of an open project, with no “there” there.
Intel’s contribution to Hyperledger.org replaces the blitheringly stupid and wasteful Proof of Work with something equally stupid but less wasteful, Proof of Elapsed Time,394 which might as well be called Proof of Buying An Intel CPU.
The noteworthy thing about this plan is how there is nothing feasible about any aspect of it.
There are various agencies that offer to handle all of this for you, because there’s never been a shortage of helpful people keen to intermediate between you, the artist, and the prospect of money.
The TAO is a smart contracts-based rights administrator selling unregistered securities shares to raise development funds. They explicitly invoke The DAO as their model, which is a bold tack to take after July 2016.428
Bitcoin itself, as an ideology fundamentally at odds with reality based on a technology that reached its limits in 2015, will keep lurching from crisis to crisis. Internecine conflicts will remain the order of the day, with partisans wielding DDOS attacks, death threats and the deployment of Craig Wright as some sort of expert.
