I find it fascinating.
Smart Contracts. Solves the Byzantine Generals Problem. Mechanism Design to unfavorable state in game theory. Encourages cooperation, leading to optimal states.
I don’t like cryptocurrencies. Maybe one day, but now it’s just hype. HODL is silly. It’s volatile too. It’s inconvenient, but that’s just today.
It’s a good problem to think about. But it’s like Communism, works well in theory, but has many issues in practice. But it can be like socialism, parts of it are implemented and we slowly approach such state or whatever state society believes is best.
Communism is interesting too because a lot of it works at a micro scale, when you can trust your peers. If you trust your peers, then you can have cooperation and benefit everybody. Maybe blockchain works similarly, at a descaled version most properties of it and benefits of it work with less worry for attack and properties like decentralization and security.
We don’t need a single blockchain for all, but maybe ones that solve the problems we have at hand. Choose the right tool for the job. Maybe we want decentralized smart contracts for a situation and don’t need cryptocurrency. Maybe we need cryptocurrency, but don’t need global scale for a different task. Maybe we need efficiency but not total privacy and decentralization for another task.
Issues are energy cost, transaction efficiency, security, privacy, true decentralization, and does it work like intended? Game Theory is just a model of course.
Do I need blockchain (Y E E T)
A good “do I need blockchain:” Do you have a trusted source and are you storing append only data?
Please correct me if I’m wrong, I just talk about how I understand it.
If yes and no, then a database or datastore might be useful. You need to read and write information, but have a trusted source that can run/keep the database/datastore.
If no and no, then a distributed ledger might be useful. This is a data store with no central authority. To keep data consistent a consensus method such as everybody voting which change is valid is used. This does not necessarily have trust guarantees however. Decentralized Blockchain is an example of a distributed ledger with trust allowing for the validation of changes.
If yes and yes, then a centralized blockchain might be helpful. Git is an example, commits are validated, pull and push requests are validated by a central authority. If you own the git repository, you have control over what happens and if somebody else does, then they can accept your additions.
If no and yes, then a decentralized blockchain (what people mean by blockchain) might be useful. You store contracts (in cryptocurrency coins are effectively I owe you contracts) that cannot be changed and can’t trust anybody like a bank to validate contracts. This comes at a price, usually Proof-of-Work, burning tons of power.
Blockchain is also an efficiency vs security problem. We trust banks, but that’s because we have to. Economics does play into it as if consumers don’t trust banks, they go out of business. It is way more efficient to trust someone then to have a true bootstrapped decentralized trust. Sometimes you just take a leap of faith and trust a person. People trust people differently. I definitely trust best friends more than classmates and classmates more than strangers from different countries. If we didn’t trust anybody nothing would get done. So trust should be used with discretion, and compromises have to be made.
Overall, there’s a lot of misinformation, but it would be cool to see it used for good. Maybe two medical companies can share results because of smart contracts. Maybe two countries can come into peace. Maybe we can work together and solve global warming, game theoretically the tragedy of the masses. Probably not, but I like to think about it and have hope.
P.S. A stupid idea I had was Mutually Assured Destruction verified with blockchain and smart contracts. Say you have countries that want peace and don’t want to fight each other. Then they can create a smart contract with access to nuclear weapons, such that if they keep their promises, nothing happens. If not, the smart contract will launch the nukes and rain hellfire on us all. It is a nuclear option (GET IT) but an interesting thought to think about. This also assumes the technology works as it says and perfectly, hahahaha.
(Edit 11/7/18: Why would miners choose to nuke everybody? Their work would go to waste 🤔. What good is money if you and everybody are dead? Some people want to watch the world burn. SO I EXPLICITLY SAY THIS IS A TERRIBLE IDEA. Definitely needs to be developed more.)Post by: Brian T. Liao