Thank you. The whole system is people running in empty circles. Most people are not doing anything useful or out of value for regular folks (housing, utilities and transportation). Even worse, we are consuming lots of resources and human time and yet (many countries) still can't solve the basic problems: decent food, affordable and acceptable housing, functioning transportation.
I'm in a city block where there is lots of "call centers". Their target is stupid, old, or ill people from the developed world. They make money "legally" from getting these people to call them on expensive lines. It's a multi-million euros business. It's fueling the whole block (real estate, food joints, coffee shops, accountants, retailers, etc...) Many of these are relying on these call centers.
The whole block is a scam. Albeit a legal one. And albeit some guys (like a food joint) has nothing to do with it.
The whole economy is something like that. Universities, hospitals, consulting, advertising, and the big one "Government" and its army of bureaucracy buildings and stuff.
The whole system is bankrupt. Bitcoin is an open system that is showing the true color of humans and greed. We are fueling crypto because that is what we are. We are just getting more efficient at it thanks to technology.
In human civilization there are really two categories of things: Services for survival, services for comfort.
Services for survival breed so much commerce: Food, Medical Research, Doctors, Medicine, etc. Suddenly you need to move the food; automotive. Suddenly you need to convince people to take chances (loans + big payout). Eventually when people have more than they need they would prefer to get comfort.
This is obviously a very oversimplified view of humanity and economics, but the reality is that we're not just running around in circles.
Bigger population #s breeds bigger logistical problems. Some see problems and inefficiencies and try to improve upon them. Etc. Seriously imagine getting rid of all these logistical services and supporting services, you wouldn't be able to feed, cloth, or heal a giant population well. We have examples, hell look at India and their structures. Look at Syria.
BitCoin cannot become a currency. It is literally impossible. The ability to have many billions of transactions a day is a prerequisite for a currency. There can be no delays, no fees. Imagine if every time that I went to a store and paid a dollar for a pack of gum I also had to pay a fee associated. Note: Taxes are different, they are fees that go back into society, not a mechanism to profit off (save the corrupt government debate for later). Imagine if my friend asked for $20 I also had to pay a fee. Imagine if that also took like 1 week to process. Not practical.
Cash (or currency) is important because otherwise I'd be trading raw beef for ipads because of what commodities I have.
Now, not to say every industry is necessary. Call centers like you describe are a predatory commerce, but these things do happen, and hard to eliminate humans taking advantage of humans, it is in our nature. If it won't be call centers it'd be another thing.
I agree that Bitcoin is unlikely to find utility as a usable currency, but this point rings extremely hollow, since buying a pack of gum with a credit card incurs a flat inquiry fee as well as a percentage of the sale, as does giving your friend $20. ATM transactions usually have fees associated as well.
I agree with most of your other points, but there's a pretty wide gulf between trading beef for ipods and the maximal cash utility of cryptocurrencies, and there's space for a more transactional crypto with more reasonable fees and processing times to disrupt the 2.5% + $0.30 credit card industry.
I think the poster is talking about BTC as a currency there, not a payment method. When talking about it as a payment method, sure there are fees and processing times. But when just handing your friend $20, or buying gum with cash, not so much.
Over here in Europe, FYI, most ATM transactions don't have fees (if you use one run by a bank anyway), and sending money to your friend by direct bank transfer is also free.
In the same way, when you transfer your money to your friend 'for free' using a direct bank transfer, it might be free to the user at the point of use, but it's being paid for somewhere, indirectly.
When I pay for $20 of groceries with a credit/debit card, someone is paying a transaction fee somewhere. You don't see that as the end-user, although you may be aware of it.
In a similar vein, consider that cash costs money to design, print, enforce anti-forgery, replace over time etc. All costs that have to be borne by the system that should be considered if you're going to compare 'giving your mate $20' vs. 'giving your mate some BTC'.
There are no fees for me to pay my friend.
I don’t know if you remember the olden days when PayPal was mainly for paying your friend $20. It was slow and cost a lot so not very cool. There would be fees just to send your friend money. This was bad.
While “giving your mate some BTC” is possible, the amount lost to fees is pretty lame.
Bitcoin cash is a fork of bitcoin because blockstream opposed the 2x blocksize increase which would have solved bitcoins current problems. Bitcoin cash has now a 8MB blocksize and can process significantly more transactions. Increasing the blocksize up to 1 Gigabyte is practical today which would result in a transaction rate in the order of of 7000 transactions per second.
If we assume every human on the planet makes 50 transactions per day it would require terabyte blocks which are still feasable with current technology but it would cost roughly 26million per full node over 20 years. The expected fees of half a cent per transaction would be enough to fund at a minimum 300 of these nodes.
The blockchain can scale. Bitcoin can't. It's 100% speculation until LN arrives but even then bitcoin might become irrelevant
We put up with fees based on mechanism, but (almost always) the seller pays. The cost of the fee is baked in to the price of what I'm buying.
My point is: as the system sophisticated, we are turning more resources toward bullshit and fake employment rather than real issues. You can't find decent, healthy food in the city center (which is affordable and doesn't cost a fortune). You can't find reliable housing in the city center too.
You can't find amenities in the suburbs. So you either pay too damn high rent or drive for longer hours. But you can't get to your location in time because we haven't been building reliable transportation or upgrading roads. Instead we are spending money on other stuff and to support countless counts of bureaucratic armies.
This certainly differs from country to country. Some countries are more efficient. Some countries are a blackhole of public money and social workforce.
I'd say you can; we're spoiled like that, in that we take for granted that food should cost a fraction of our income. Historically speaking, the income was barely sufficient to cover food. What you're saying is that you can't find cheap sophisticated food and exotic items... yes, that's right, but you never could. We're improving on this, we're not getting worse...
> You can't find reliable housing in the city center too.
It's unclear what you mean by "reliable". For the right price, yes you can, most definitely. "The city center" is by definition a finite resource, so a limited number of people have access to it; if the city is very desirable, some people will always be outpriced (at least, for as long as we have a physical presence/ as long as the "limited number" constraint stays true).
My point is: as the system sophisticated, we did solve a lot of issues (not all, but that's to be expected). Did the bullshit increase? Yes, but so did everything else. And I'd much rather see an increase in bullshit than in, say, war. "Panem et circenses" - you have to keep the people occupied so that they don't become troublemakers. If you can find a reliable way to transform a bullshit occupation into a productive occupation, I'm pretty sure you're going to get extremely rich. This is a hard problem - we're not doing it because we don't know how to do it any better than we currently are, not because we don't want to.
From that basis, it suggests a likelier path of "local lending -> currency", i.e. that a straight up barter system never existed in ancient societies, and instead a notion of "who owes whom" was publicly known in small tribes and while those with the power to enact violence often had the ability to demand things somewhat disproportionately, most people did a good job of assessing what stuff to give, what people to give it to, and when to do so, as a moderate sized socialable semi-cooperative set of families with common interests might be capable of just... knowing.
When tribes began trading things to each other at scales too large or untrustworthy to keep track of by memory, the simple innovation of writing it down in some form would often occur, which is the birth of currency, long after the notion of indebtedness, and other innovations of abstraction and regulation and such can build on top of that over time to create the modern concept.
This doesn't really speak to your major point that a modern currency must support a large number of transactions/minute with low or no fees, which I agree with and agree Bitcoin seems (for now) ill-suited to handle; I've seen suggestions (on a paper linked on marginal revolution I think) that Bitcoin makes more sense as an asset to hold like gold or stock than it does as a currency, because its transaction fees, timing, and (for the moment) growth characteristics strongly incentivize not spending it.
But what I was saying was that currency is not important because "without it we'd all be bartering", rather, it's important because "without it we would need to trust and know everyone we deal with every day well enough to track all our mutual indebtedness mentally", Which is plainly impossible in today's world!
Currency needs to have few reasons to hold onto it rather than use it, and needs to be able to be exchanged quickly between any pair of actors regardless of external state. Cash is great for that, credit cards are getting there (me->business is good, business->business and business->me and me->you all much less so), and Bitcoin is a long, long way off.
To tag some more weight into this very long post: my personal bet is that networks of micro-applicable cryptocurrencies (say, "Toronto Downtown Ethereum") in a network-system like Cosmo that settles debts across multiple blockchains quickly and efficiently will approach the use-case of cash, with the properties of local, highly scalable, and low-fee transactions. We'll all be using baskets of currencies all the time, basically, but with that fact abstracted for most people down to card or phone tap actions. Some professionals will still care which currencies, and how they operate, but they'll be a bit like forex traders are today.
To make this prediction interesting, I give it a 15% chance at being reality somewhere within 3 years, a 50% chance in 5 years, 80% in 10 years, and 20% chance it takes longer than that or never happens because new technology/events make us skip/avoid it. (these averages obviously must accumulate the earlier cases within them where needed.)
The thing to note, just like governments, food distribution, and web requests: all things have limitations on scale. Governing 20 people and 200 is vastly different. And 200 and 2000, and 2000 vs 20000. Etc. The bigger the scale, the harder the problems.
BitCoin is only solving the decentralization aspect of currency, but is not solving the other aspects. And without a strong backing of it, we can see the price fluctuating wildly.
- Richard Yates, Revolutionary Road, 1961
I don't wanna go dig through my copy to find it right now, but there's also a pretty long bit where he describes how most of the "work" that most of the "workers" at his (the character, Frank Wheeler's) firm do is making brief comments on various proposals or memos or whatever then sending them off to other people for their comments, trying to avoid being caught with the hot potato and actually having to do whatever's being proposed. They're all very good at it.
Again, written in 1961.
heh I hope that's a typo
Boy oh boy it is a depressing book/movie: prepare like you prep for an episode of black mirror I guess.
The entire process would be confusing as hell to most folks, who continue to exist in denial that most modern "work" is already a surreal effect of the networking of human beings enabled to an exponential degree (exacerbated?) by technology.
The Unabomber must be laughing hard in jail, reading today's news headlines.
If you enjoy your current standard of living, then the answer is a clear, resounding "yes". You wouldn't be able to post on HN without the time investment of the people who created your browser, or maintain HN, or provide and maintain the infrastructure you use to post.
> Maybe cryptocurrency is a bubble, but maybe also everything else is a bubble. Companies like Snapchat are worth billions of dollars, but they lose billions of dollars each year.
That's an arbitrary example that supports your argument, but is not representative for the general economy -- in fact, it's entirely the opposite.
Now compare your sentence to one where I substituted Apple for Snapchat:
> Maybe cryptocurrency is a bubble, but maybe everything else isn't a bubble. Companies like Apple are worth hundreds of billions of dollars, and they make tens of billions of dollars in profit each year.
The whole 'truthiness' aspect is mildly surprising to see on HN ("It feels right, so it must be true", and usually it applies to others - never the poster or their organisation.)
I spend half my live learning to code. And now I code shitty forms and buttons which will get thrown away and replaced in 5 years by the next guy doing the same.
My definition of value may be opinionated, but recreating the same software again and again, based on an outdated stack and thrown into garbage has no value for me. Maybe it's different somewhere else. But where I live most coders do exactly this.
If he's not creating any value for you, why are you paying him to do it?
If you pay him to do work that creates no value for you, you're the irrational one, not him.
Sure sometimes it makes sense, but I assure you, many time is just in hope that the rock will go higher this time (it won't).... nothing more.
Because I want to demonstrate "growth" to investors by hiring as many employees as I can afford, whether or not I actually have something for them to do.
Why would you? This example isn't realistic. It just shows value isn't precise to any single example, but an expected outcome over time; individual value judgments aggregate over the population to give a "true" metric of value.
What value isn't created directly by Sisyphus, could be created in the fact that Sisyphus is willing to provide a service without finding any personal value in it. The freedom to do things without demonstrating its value, itself has value.
> has no value for me
Inefficiencies are opportunities. Can you sell the same stack over and over again?
If my work can help society at the same time then that's fantastic, but as long as it allows me to provide for those closest to me then, for me and my family, my work is the most valuable use of my time possible.
It is of course nice to have work of which you personally value the output. But in your case, someone else values your output and pays you to produce it. Calling your work "without value" is thus a bit strange to me.
If someone is paying you, you might be contributing to their definition of value. The money you earned are stored tokens of recognition of that fact, that can be traded to persuade others to contribute to your definition of value.
Don't you notice the contradiction?
The counterpoint would be that there is a huge amount of 'real life' happening within the confines of the system as you describe it, and many people are not so negatively affected as you might think.
Underneath it all, yeah, a great many aspects of how we do things are arbitrary, horrifically inefficient kludges with overly externalized costs that would be replaced immediately on a more level playing field... but solving the problem of 'greed at the top' is possibly the biggest and most difficult challenge we face as a species, and I don't think it makes you a bad person to decide you're not up for spending too much of your brief existence fighting against it. Enjoy what you can while you're here, sometimes that's the most effective way to brighten the world around you.
Are you a beneficiary of this system? We aren't very good at thinking on a large scale as a species, and most of us on Hacker news are in some way beneficiaries of the system, relative successes. However, there is something deeply troubling about the social and economic structures that are currently pervasive. I don't think you or anyone else is a 'bad person' for not fighting against the way things are, but I personally believe there is a better way, and we have the tools now to find it.
In New York for example, most of those tall buildings and millions of people have withstood the test of time, numerous decades, snapchat and cryptocurrencies have not.
Yes. Value is largely subjective. This underpins supply and demand. Things that are in demand are valuable to us, and what's in demand is often subjective.
So although you or someone else may not value things like Snapchat or Facebook, society in the aggregate does. Much in the same way that gold, bitcoin, or a rare painting is "valuable". It's valuable because someone is willing to pay for it.
There's a lot of work in everything: https://xkcd.com/1741/
I've worked in industries I had no idea even existed until I worked there. But they made sense once I found them, and I created value, as did most of my colleagues. Maybe you're in a bad job at the moment and need to look a bit wider?
> Companies like Snapchat are worth billions of dollars, but they lose billions of dollars each year. At least most cryptocurrencies don't lose money (except some of them due to electricity costs).
All cryptocurrencies are burning money on electricity costs. And what do they have to show for it? I've got plenty of fun out of Snapchat, so even if their investors don't get a return it's not like the money was completely burned, whereas cryptocurrencies spend electricity with nothing to show for it except some numbers that hash to other numbers.
Value is relative. You may have created value in the reference frame of a particular industry, but perhaps that industry is not of value. As e.g. Ponzi schemes show, people pay for things that have no value, so money is not a reliable indicator.
Another example is the entertainment industry. A lot of money is being spent, orders of magnitude more per minute of content than say, 40 years ago. But are people more entertained now per minute of content than back in the old days?
It has its flaws but on the whole it works. Certainly in the cases I'm thinking of my industry was producing value and I was producing value to the industry.
> Another example is the entertainment industry. A lot of money is being spent, orders of magnitude more per minute of content than say, 40 years ago. But are people more entertained now per minute of content than back in the old days?
Yes, much more. Try watching old films, playing old games. There are a few gems but there's a lot of awfulness, and even more than that, even in the good ones everything's so slow.
You seem to be confused to the point that you assume that value can only exist if you personally find anything to be of any value and only in the long run. That's not how the world works. Value is subjective and everyone has their particular needs at each point in time. I don't go buy speedos in the dead of winter or skis in august, nor I'm going to spend money on a show or a book that doesn't interest me. Does that mean that any of those things has any value?of course not.
Keep going and the beast feeds it's self with communication overhead requiring a lot of office workers.
The work performed is required for the currency to be secure. My browser burns electricity verifying SSL certs.
Doesn't SSL have an increase in bit size too?
Recommended bit sizes for a given cipher do increase but only very gradually, since the attack cost is exponential in the number of bits. 20 years ago 1024 or 2048 bit RSA was standard; now 2048 is recommended as a minimum for extremely high-value and long-lived keys (i.e. CA root certificates) but that's all. Host key lengths are actually shorter these days than they were 10 years ago, since algorithmic improvements (elliptic curves) allow the same level of security with much shorter keys.
A centralized currency lets the central source of trust protect their security at far lower cost.
How much effort do credit-rating, fraud etc agencies make? A centralized currency requires trust, which crypto-currencies don't. To compare value, you need to add a price tag to this liability. The lower cost comes from the savings made in not having to secure against the central authority itself.
There are other upsides like independence.
It’s more efficient for everyone to take a bus and never drive a car alone. But cars give freedom. It’s more efficient for the world to eat soy lent instead of a diverse diet.
Complaining about how cars use more fuel than buses or how strawberries take more water and fertilizer than soy neglects to capture all the benefits gained for those higher costs.
If you work in a big city and look around; there are tall office buildings everywhere; packed with millions of people. But what do these people actually do? Is that an efficient use of their time in terms of creating value for each other?
Maybe cryptocurrency is a bubble, but maybe also everything else is a bubble. Companies like Snapchat are worth billions of dollars, but they lose billions of dollars each year. At least most cryptocurrencies don't lose money (except some of them due to electricity costs).
Even companies like Facebook which are themselves profitable are deriving most of their profits by providing services to companies that are unprofitable.
Maybe the total value of all cryptocurrencies isn't actually going up, maybe it's the value of everything else around it that's hyperinflating. Maybe the current system is just begging to be dismantled.