With Bitcoin, most issues were a result of private organizations misappropriating money or security. But the entire foundation of Ethereum is now considered completely unreliable.
(Another big problem with Bitcoin at scale is that you can't count it without access to the keys that let you spend it. This makes outside auditing very difficult and helped to enable the Mt. Gox scam. Etherium doesn't address that. Some multi-signature scheme where external parties could determine that an account has funds without the key needed to take them would be useful for a cryptocurrency. But, as Etherium shows, adding complexity adds exploitable bugs.)
That's not remotely true, I'm not sure what gave you that idea. Bitcoin at its core is based around asymmetric encryption, which allows only 1 party to send money but everyone to verify it. By sharing a public key (a bitcoin address) you can see the funds, but can not spend it. In fact, right from the start bitcoin client even included the ability to sign and verify messages from addresses to prove ownership. Right now I could give you the bip44 (public key) of my wallet and you could see every transaction I have received, sent (and all future ones, from that wallet). But you'll have no ability to spend my money. Although I'm not going to do that for the same reason most people won't: privacy.
Anyway, there's been proof of solvency schemes for a long times, it's just most exchanges and services (with a few notable exceptions) haven't seen a business case in implementing it.
So yeah, an exchange like Mt Gox can not prove they own the USD they should own, but can prove they own the bitcoin they claim to own. How is this a problem or limitation of bitcoin again?
I'm not an expert, but I'm pretty sure one could use the private key, without revealing it, to sign a message, for example "%date I, %owner, own the bitcoin in $account".
Then anyone else could check the signature against the public key on the blockchain.
Would that not be enough?
Correct me if I misunderstand, but checking that an account has funds is trivial. It's in the blockchain. Multi-signature transactions are also standard.
Considered by who? The bugs are in the smart contract, not Ethereum itself.
The EVM may be reliable, but the humans that use it are completely unreliable, and it's the humans that form the foundation of any distributed system.
Like a certain programming language's features, it may happen to be easier than not.
You can in addition implement these safety checks to be executed during runtime, but that costs money.
The door lock company is the funniest part of the whole thing. It makes this meltdown so much less surprising tbh.
Somewhat related: the lock in my apartment is actually based on cryptography too. It uses SHA-1, which is somewhat scary, because it's not considered "safe" anymore. The algorithm was probably chosen because it uses less energy compared to safer ones, as the lock gets the energy from the turning of the key.
"Commerce on the Internet has come to rely almost exclusively on financial institutions serving as trusted third parties to process electronic payments. While the system works well enough for most transactions, it still suffers from the inherent weaknesses of the trust based model. Completely non-reversible transactions are not really possible, since financial institutions cannot avoid mediating disputes. The cost of mediation increases transaction costs, limiting the minimum practical transaction size and cutting off the possibility for small casual transactions, and there is a broader cost in the loss of ability to make non-reversible payments for nonreversible services. With the possibility of reversal, the need for trust spreads. Merchants must be wary of their customers, hassling them for more information than they would otherwise need. A certain percentage of fraud is accepted as unavoidable. These costs and payment uncertainties can be avoided in person by using physical currency, but no mechanism exists to make payments over a communications channel without a trusted party."
The problem with [a trusted central authority] is that the fate of the entire money system depends on the company running the mint, with every transaction having to go through them, just like a bank.
Sure, it's hard to say exactly what Bitcoin is for or against, given that it's a multi-faceted community with many different goals. But to deny that decentralization and lack of central planning is a huge motivation / driver / goal of both the original inception of Bitcoin, and also the community that developed around Bitcoin, is pretty hard to believe.
The original poster insinuated Bitcoin needed all-powerful policy planners ("Davos meetings"), which is false. All that is taking place is community discussions about scaling (block size increase), but it would be absolutely incorrect to compare this to "Davos meetings".
Watching this rapid evolution towards traditional legal systems reminds me of an oddball scifi story about life on the surface of a neutron star. Everything moves so quickly that, by our perspective orbiting the star, civilizations may rise and fall within days.
Basically what is the point you're trying to make?
If we're going to blow so much computer power on raw calculations, we could use it for Folding@home, SETI@home, or any number of other great causes. But this is just a waste.
So, beware of status quo bias.
Not a great idea for a currency.
You could equally say that the threat of collapse of the US government dilutes the utility, marketplace and value of the US dollar. Sure, it's true, but it's irrelevant.
You're... kind of agreeing with me here.
The reason a threat of a fork works is because it had the results I mentioned.
Ethereum is a bad idea and people are too embarrassed to admit it. I get it. However, turning around and shoehorning that sentiment into "They don't understand central banking" is just foolish and highlights the sort of headstrong obliviousness that has essentially springboarded DAO into the spotlight to begin with.
Smart contracts aren't good for stupid users. Someone outsmarted a big group, now they're having a fit because all of their money is going to leave, and rather than walk away from the poker table with their head hung low, they've decided to just rob the dealer and try for heisting the vault while they're at it.
And then they have the gall to say "Oh, you just dont understand the purpose of central banking" as they oppose a system that they put in place to benefit themselves, by themselves.
I am long on cryptocurrencies but the community at large needs a reality check to see where they currently fit.
I am in full control of which currency I use when transacting.
The bitcoin world now has "consensus" meetings which from an outsiders' perspective look a lot like the kind of meetings at Davos that bitcoin was supposed to be against, only without regulation, consumer protection and any recourse against bad actors within the upper spheres of influence.
In future of ethereum there'll have to be "arbitration committees" which will look a lot like courts. Self-appointed, unregulated courts of course.