Re:People don't want to run their own bank
by mschuster91 on Friday February 04, 2022 @09:29AM
(#30207132)
> But there is a section of people who do want to run their own bank. That the cryptocurrency space exists in the first place is the evidence of this.
Most of the crypto-bros don't run their own banks either.
All of them depend on institutions that effectively act as banks somewhere down the line... first of all, the overwhelming majority of actual cryptocoin users doesn't run their own nodes (which, as "bookkeeping", is one of the core functions of running a bank), instead keeping their wallet at some sort of wallet service or transaction gateway, because running a node requires disk space and a continuously running machine. And then, almost everyone participating in any coin requires exchanges to turn the coins back into fiat money or vice versa - I've yet to see any actual real-world economy that does not use fiat money but instead handles everything with Bitcoins or whatever.
> Decentralization at the core gives people more options, which I think in the long-term leads to a better world, compared to the alternative. Not because it is decentralized, but because it gives more options to the ones who need it.
The only thing "decentralization" enables is a lot of elaborate, irreversible scams, hacks and thefts. A banking system without some sort of centralized entity to deal with disputes and prevent usage for criminal activity eventually will break down... there's a new exchange that got hacked, a "smart contract" drained via intentional or unintentional bugs, NFTs being doubly-sold (if I understand that recent OpenSea bug correctly) or rug-pull scams exposed almost every other week. That is not a trustworthy environment.
Not to mention that all cryptocurrencies to date have led to enormous waste of resources: electricity, CPUs, GPUs, ASIC fab capacity, RAM, HDD... literally everything that could be used to mine coins got used for that purpose and outright killed the market for these, because miners can always pay far greater sums for components than individual people can.
Most of the crypto-bros don't run their own banks either.
All of them depend on institutions that effectively act as banks somewhere down the line... first of all, the overwhelming majority of actual cryptocoin users doesn't run their own nodes (which, as "bookkeeping", is one of the core functions of running a bank), instead keeping their wallet at some sort of wallet service or transaction gateway, because running a node requires disk space and a continuously running machine. And then, almost everyone participating in any coin requires exchanges to turn the coins back into fiat money or vice versa - I've yet to see any actual real-world economy that does not use fiat money but instead handles everything with Bitcoins or whatever.
> Decentralization at the core gives people more options, which I think in the long-term leads to a better world, compared to the alternative. Not because it is decentralized, but because it gives more options to the ones who need it.
The only thing "decentralization" enables is a lot of elaborate, irreversible scams, hacks and thefts. A banking system without some sort of centralized entity to deal with disputes and prevent usage for criminal activity eventually will break down... there's a new exchange that got hacked, a "smart contract" drained via intentional or unintentional bugs, NFTs being doubly-sold (if I understand that recent OpenSea bug correctly) or rug-pull scams exposed almost every other week. That is not a trustworthy environment.
Not to mention that all cryptocurrencies to date have led to enormous waste of resources: electricity, CPUs, GPUs, ASIC fab capacity, RAM, HDD... literally everything that could be used to mine coins got used for that purpose and outright killed the market for these, because miners can always pay far greater sums for components than individual people can.