Please don’t auto downvote before reading.
A little bit ago some asked a question about why the hate of the blockchain, and that got me thinking if there even was a legitimate use case where the blockchain would be beneficial, but I couldn’t think of one outside maybe some sort of decentralized bank, but before I knew I was thinking it would instantly turn into some crypto scheme and strapped it, because crypto currencies are a scam on every level – and no they aren’t private or secret as some think either.
So I wanted to ask the community. Instead of using the blockchain for crypto, is there a better use where the blockchain could benefit society?
Let’s first state what the blockchain states it is:
- immutable
- public
- decentralized
Let’s say that you’re a user who wants to use the blockchain to manage something outside of the digital world with it. You create your product, and begin advertising it. No matter what this product is, it cannot affect the physical world. This means that immutability is a problem. The real world has mistakes. If a person sells their car, they need to hand over cash in the real world. How does that knowledge make it onto the chain? Same for a house, etc. Any object that has a transaction in the real world has to have an authority that manages whether that object has actually changed hands. So for the simplest use case, the chain has already failed.
Let’s talk about the next one: public. Nobody wants their transactions public. You don’t want votes to be public. The blockchain is not anonymous, no matter what anyone claims, because every record is tracked you can eventually deanonymize anyone if you wanted to. So this one is just a bald-faced lie and something not to be desired in any situation. The point here was to make it so that you can be decentralized and the public can be the ones to police others users of the chain, so let’s talk about how it’s fundamentally impossible for a chain to actually result in a decentralized world.
The blockchain is not actually decentralized. If you want to handle money in most countries on earth, you have regulatory bodies that govern everything about your operations. That means if you want to write an app like Shopify that someone can use to pay with bitcoin on a website, even if you are not selling something physical, you are still governed by a central body. Not only this, but once you want to sell something physical, you have to extract your money through a physical bank in the real world, which is also governed by the same regulatory bodies. This was immediately known as a problem in the early days of bitcoin and other cryptocurrencies, and it is still a problem today. This problem is not solvable as long as governments exist.
Funnily enough, each one of these elements does have use by itself! For example, distributed databases have been around for decades, and are the basis for much of the tech you use today. There are even immutable databases that are in use in many industries to keep an immutable record of what happened. AWS is sunsetting it now, but their QLDB was exactly that. CQRS with Event Sourcing is another implementation of the same idea. Finally, any government service or company could make records public if they want to. In fact many already do, for example home ownership records. If you own a house, that information is not private.
Putting something on the blockchain is no more than a move to make sure whomever owns that crypto gets more money out than they put in. If an actual use case existed for this tech, it would have been used decades ago when it was first invented (the blockchain was actually invented in the 80s by cryptographer David Chaum, decades before Satoshi invented Bitcoin and it was even discussed in Satoshi’s whitepaper).
I can talk for hours about how each element of the blockchain is just either a grift to extract money from others OR a cynical, incorrect outtake on how the real world functions. If you want that, let me know.
Nice explanation, thanks. I would read more.
Do you also have brief, pointed argument against crypto/blockchain that you use in casual conversation? The subject comes up fairly frequently and I know it’s all bullshit but I usually struggle to explain why. What key points would you make to people who might be starting to get seduced by the hype or who are already sucked in?
Not OP, but in my circles the simplest, strongest point I’ve found is that no cryptocurrency has a built-in mechanism for handling mistakes. People are using these systems, and people make mistakes. Without built in accommodations, you’re either
- Creating real risk for anyone using the system, because each mistake is irrecoverable financial loss, and that’s pretty much the definition of financial risk, or
- Encouraging users to subvert the system in its core functionality in order to accommodate mistakes, which undermines the entire system and again creates risk because you don’t really know how anything is going to work with these ad hoc side systems
Either way, crypto is just more costly to use than traditional systems when you properly factor those risks. So the only people left using it are those who expect greater rewards to offset all that additional risk, which are just speculators and grifters.
I completely agree with your post except for the last part.
Either way, crypto is just more costly to use than traditional systems when you properly factor those risks.
This all depends on the risks involved in the traditional systems you’re comparing the cryptocurrency to. Traditional systems are exposed to some kind of risk that cryptos aren’t. For example, with cryptocurrency your account can’t be seized or frozen by authorities, be them governments or banks. With some cryptocurrencies you are also at much lower risk of hyperinflation (or inflation in general).
In many cases the risk involved in using cryptocurrencies will outweigh the risk posed by traditional finance, but that’s not true in all cases. In some parts of the world, the risks involved in traditional finance are significant…
What the other person said is good, but two of the simplest things to say are “this tech already existed and was in use for decades, and doesn’t require the massive energy waste that blockchain does” or “blockchain is designed around distrust in everyone. If you distrust everyone then why are you doing business with them?”
Nobody wants their transactions public.
This is a broad generalization that is easily refutable. Examples:
- Property titles
- Political campaign contributions
- Supply chain certifications, to fight consumer fraud and counterfeitting.
Frankly, you say you can talk for hours on the subject, but I don’t think that hours of thought has been given to the subject.
I haven’t talked to anybody that wants those things public, so yeah I can still claim that. Those things are public, but that does not mean people want them public. I have spent hundreds of hours debating people on blockchain tech, including as part of a previous job. Please do continue to try to refute me though.
I’m pretty blockchain neutral. I took an interest in it at one point, did some graphics work for a few companies so I learned the ropes. So yeah, I agree with the statement that OP’s making a few leaps in logic.
There are a lot of corrupt as fuck companies working in blockchain because of a weird cryptobro need to reinvent the wheel of finance, but blockchain is still kinda neat. Sending funds internationally is easier, in my experience. Moving funds across borders can be a pain in the ass through a bank if you don’t do it often - with crypto it’s a few clicks.
This is from my old crypto knowledge before I stopped working with those folks, but there was a company in africa that launched a mesh network that spanned across multiple countries, using crypto as both the payment and the fee for spreading the signal or using it. Then there were at least a couple cases of people securing control of personal, sensitive media by tokenizing it as an NFT - which I understand was done as a faster and cheaper alternative to copyrighting internationally.
Again, I can not state enough how not a crypto bro I am, because it seems like standing in the middle of the road makes me too block-chain friendly for the internet. I’ve been involved peripherally to a few things that made me go “Huh, that’s actually pretty cool.”
No matter what this product is, it cannot affect the physical world.
I’m going to go ahead and refute this claim.
Blockchains can be used to affect the physical world because blockchains can be used to transmit information. One example would be if the result of a blockchain transaction is sharing important information with a user, say a password, account number, or access token.
But there’s also the more obvious case, you can use financial blockchains to send money. If a system is designed to work with that currency, then it will presumably work with that currency. You could for instance design a vending machine to take Bitcoin, if it receives a certain amount of currency to a certain address, it dispenses a snack. Yes, there is an authority that manages this vending machine, but that’s unavoidable in any case. No matter what the scenario is, someone needs to own the machine and manage maintenance and supply for it.
Your example isn’t a blockchain, it’s just an example of an immutable database with a linked list structure. A blockchain has to have all three elements, else it’s just a previous technology that is already in use and has been for decades. Immutable databases already existed. Public ledgers already existed. Cryptographically hashed databases and audit tables already existed (CQRS with event sourcing is an example of this).
Your examples around affecting the physical world still are not accurate. If the blockchain has a contract in it that says “dispense a snack” then it’s completely dependent on what happens in the real world. Maybe the snack doesn’t dispense, maybe there isn’t a snack to dispense, maybe the user tricks the machine into thinking it didn’t dispense a snack so it dispenses two. There is no way for the blockchain to validate the results of reality. It’s just not possible. The entire premise of the blockchain is that you can remove authority, remove government, remove all this in between and just have users validate each other. It’s just not possible. It completely ignores reality.
Besides other refutations, I’m going to refute the fact that blockchain requires those three points.
Block chain is a shared incremental ledger in it’s essence. Since its inception banking systems have adopted it to have shared ledgers between them to manage transactions between them in a secure way, without fear that the ledger has been tampered by some bad actor of the other bank, since the history of transactions is shared in a way that can’t be tampered without alerting both parties.
So yeah, that. Banks adopted it pretty quickly to be used in transactions. The way you describe immutability is incorrect, you can mutate the current state into the next one, you just can’t mutate past transactions. This example is very much not public, just shared between two private individuals, so not public either. I guess you can call it decentralised too.
You keep calling it “the block chain”, when blockchain is just a name for a technology, a chain of blocks of information condensed incrementally in the next block, that’s it. You are thinking too hard about it.
Edit:
Funnily enough, each one of these elements does have use by itself! For example, distributed databases have been around for decades, and are the basis for much of the tech you use today
Decentralised != distributed, a biiig !=. Decentralised implies that there’s no main/master node coordinating operations, there’s no main authority. whereas in distributed systems, the ones you mentioned anyway, there’s always a main node coordinating what worker nodes do, worker nodes act on what the main node, there’s a very clear authority role.
I’m going to say “no”, at least in the practical sense.
Before “AI” was the current hype, there was an equally annoying “Blockchain all the things” hype (and associated cryptobros partially fueling it). Aside from the various crypto scams, I’m not entirely sure if/where it found its niche. The fact that everything today isn’t running on blockchain like the hype of yesteryear predicted is pretty solid evidence that it wasn’t all that it was cracked up to be.
I’d say in theory it could be used something like public records of proof for ownership of immaterial or intellectual property and the transfer thereof. Say the rights to music, writing, digital art and whatnot. Like the essence of NFT without the hyped up crypto bro speculation and pump’n’dump.
The difficulty would be to get it recognized as legally valid and the bigger difficulty that as there is no central authority there is also nobody being able to rectify fraud or user mistakes. If you implement central authority it’s basically just any old list of transactions with some extra crud so then the question would be why even bother.
It’s not even good as a bank. On the other thread you mentioned I commented that blockchain is an immutable ledger visible to everyone. That is a nightmare for privacy reasons.
Audit logs is genuinely the only application I see it may be good for, but we have other systems that have a smaller environmental and technical impact making them a better fit than blockchain.
I remember exploring how it could be a way to secure digital Democratic elections. Any thoughts on this?
Forever immutably recording who voted what, I really can’t see a way for that to go wrong
“who” in your sentence doesn’t necessarily need to identify an individual depending on implementation.
What’s so scary about that? While the reason seems obvious, I ask because if you know what sort of sophisticated voter identification models the parties have right now, they can easily ascertain your voting history with 90%+ accuracy and predict fairly well who you’ll vote for in the future anyway.
I was just thinking of this recently but if Trump utilized his immunity to the fullest extent and we descend into Kristallnacht territory, these voter models would be how they began purging, “the enemy from within.”
So given we already are at that point, then maybe the benefits of such a ledger could outweigh the cons.
You don’t fight fascism by accepting that it’s already here and opening the door further.
Ironically, you’re accepting fascism is here by preventing us from advancing with a more secure election system that would permit a more responsible, accessible digital voting, are you not?
You’re holding us back for fear of what could be.
Even in the wake of what already is a practical reality as I showed.
Thats a lot of mental gymnastics to justify a massive overhaul of a system which would open up a whole slate of security issues. I get it, I used to believe strongly in blockchain but so far it seems to be a solution looking desperately for a problem to solve. You cannot “tech” your way out of societal issue.
The more voter accessibility, the better vote turnout. It’s no different than going the opposite way with voter suppression strategy or Jim crow laws. Most states already utilize digital transfer of voting data to state secretary central branches to my knowledge.
Not only this but it (a) actually helps prevent voter fraud while (b) improving turnout by way of digital accessibility.
If we shot down every idea from the peanut gallery because it wasn’t simple on its surface we wouldn’t have a lot of things.
But what did I notice is that you’ve now twice dodged the fact that the thing you’re most scared about implementing this is already a reality.
So can you explicitly tell me what unavoidable downside it would bring that doesn’t already exist in reality?
I’m just here to tell you that this is a very US centric view. I’m not from the US and, outside of random internet posts, there are no records of any of my political associations, past or present, and I’ve voted in all local and national elections for >20 years. Seeing as extremist forces are unfortunately currently gaining power over here, I REALLY wouldn’t want any type of public record even hinting at who exactly I’ve been voting for.
It’s all the bad idea of regular digital elections, with the additional stupid of being more public, complex and wasteful
Private transactions, despite what people here are saying. Let me explain:
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Privacy is not equal to anonymity. The latter is much harder to achieve.
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There is Monero, a crypto made specifically for anonymity. It’s not very convenient to use, but it is preserving anonymity with multiple measures.
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Even Bitcoin, which is not built for that purpose, is private enough. It depends on how you use it.
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Deanonimization in general happens when you link your transaction with personal identifying information, but you can reduce your exposure by following certain opsec rules. I see this situation is better than traditional banking where your transactions are always not anonymous, and privacy is only protected by the bank itself. Data leaks happen, governments can get to your transaction info via legal means, but with crypto you have more options to protect yourself.
I strongly advocate for the exclusive use of Monero and even sell physical items shipped to your home with Monero directly. For this exact reason.
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Its only real use is as dark money. Which isn’t always a bad thing - there are a lot of activists in oppressive countries who rely on bitcoin donations, Anarchist Black Cross comes to mind.
But, as you said, it’s not really as “dark” as people think.
I seem to recall someone developing a “game” that was based on the blockchain but used to crowdsource protein folding models or something like that? I could be mixing two memories though. I could see how the concept could possibly be implemented for something like that, but I wonder if it couldn’t be handled more energy-efficiently by like a single quantum computer doing calculus.
It’s a good way to pay for illicit drugs, weapons, anything really, that you ordered using TOR, or your favorite unattributable communications technique. If you believe there are laws that should not be, that’s good. If you are in favor of those laws, not so much.
as long as your a minor enough criminal for no one with resources to bother tracking you down using the public data on the chain
No
Fine, I’ll elaborate a little more.
Blockchain generates typically with huge cost and inefficiency a decentralised ledger of events. If you are going to use a blockchain you need to ask yourself tow questions. 1. Do I need a decentralised ledger/record of events and, 2. Am I willing to put up with the huge increase in costs for creating said ledger.
In my opinion there is nothing that satisfies these two requirements. Blockchains can not remain decentralised for anything that interacts with the physical world as some needs to input the data in the blockchain. This requires you to trust a party destroying any notion of decentralisation (i.e. if an entity can control what goes into a blockchain then it really isn’t decentralised).
Following from this if you are willing to accept and trust a centralised actor to control what enters your blockchain why not trust them to manage your ledger. It would be simpler and easier than using a blockchain.
Finally, as for digital goods that don’t interact with the physical world. Why do you want to introduce a decentralised scarcity? It’s a silly idea. Either you own the intellectual property and you decide who has a license to use your digital goods (in which case you don’t need a blockchain) or you leverage some of the best attributes of the digital world and you leave the good to be freely copied, downloaded and used. A blockchain is just a wasteful unnecessary exercise at that point.
Basically there’s no legitimate use case for blockchain. The best proof of this is just how little real world adoption blockchain technology has in the real world. It’s as old as the iPhone and yet I don’t know a single person who uses it to get things done in their day to day lives. If it had a use we would have found it already.
The general category of potential use case is when you want some information to be public, undeletable, and outside of corporate or government control.
While I can’t think of a compelling use case at the moment (other than whistleblowers, maybe), given the direction our corporations and government are going it seems like the sort of thing that might become increasingly useful in the near future.
A blockchain is just a list of records. You put data in it, and you have some script that ensures the data is internally valid. For example, with cryptocurrencies you can’t allow a transaction that causes a balance to be less than 0. A blockchain containing such transaction is invalid.
This is nothing particular. You can do this with most data records.
What’s unique about blockchain is that if you have two blockchains, both are internally valid but have records that disagree with each other, then you have a way to decide entirely by yourself which one you should prefer. For example, with Bitcoin you choose the blockchain with most “work”. No need to ask some third party about which one you should prefer.
And that’s where it falls apart. These situations are rare. There might be a few niche cases. I haven’t heard of any use case that’s particularly convincing to me.
Cryptography based Banking
There are lots of good reasons to not base money transfers on arbitrary numbers that you need to keep track of. Right now, banks have to make sure themselves that a transaction is legitimate and may never lose record of it, otherwise money just disappears to someone’s damage. With a blockchain, you get a hard proof a transaction took place. Whether that’s to proof you paid for something or for law enforcement to know you bribed a certain someone, I firmly believe it’s better than what we do now. If my bank told me tomorrow I have no money or claimed I spend it all on terrorism, I would be in a pretty bad spot.Ownership and Track Records
We live in a time of misinformation and AI generated bs. With the help of a blockchain, you can keep track of who posted something first, i.e who has the copyright or started some false information campaign, and also who generally spreads bs. This of course also works the other way around: Who has a good track record and posts trustworthy news or original content? And again, you wouldn’t necessarily have to rely on a single institution to play nice, not delete content etc. Although admittedly, it’s much more complicated this case, because you have to expect bad actors much more than in banking. Banking is infrastructure, this can be a lot of things (science and/or opinion and/or legal stuff…).A blockchain is a log of data entries, that is resistant to tampering.
So I would say things like important debates or historical records are good. Congressional record, for example, is something that currently relies on the government being trustworthy as its basis for legitimacy.
If we didn’t trust the government to maintain the congressional record without altering it, then the congressional record would be a good candidate for blockchain storage.
The “Blockchain” technology is gonna become crucial in the future of AI and Deepfakes.
Since videos, and especially still images can be faked. They would be treated just like witness testimonies, evidence that can be falsified.
What I think will happen is that people would have to use live internet connection to verify a video.
So what happens is that whenever a video is recorded, there will be a “blockchain verify” feature in the camera settings, when enabled either the video feed or the hash of the packets of video data is sent to a blockchain network where it gets timestamped and stored permanently on the blockchain.
The network would consist of various nodes that ideally aren’t government run. Think like the ACLU, EFF, or Journalists, or people who independently want to join the network. Each would run their own node independently.
So any time theres suspicion that a video may be faked, the courts can just ask the network to send their own copy of the blockchain, if theres a consensus, then the video can be proven to have been created at the time that is timestamped. So there’s no way of creating a fake video evidence after an incident since you wont have the timestamp on the blockchain.
Why would this require a blockchain, as opposed to standard public servers run by the same parties mentioned?
Because the fewer servers the more trust you need in the servers owners. And the trust is not limited by intentions, it’s also limited to their ability to not be compromised by private or state sponsored hackers.
The blockchain is always “gonna become crucial” in lots of things, depending on whatever looks popular at the moment, yet it never does because it is obviously a bad idea.
It’s a grift, and if you’re not an active grifter, you are the mark
Full self driving in 2 years, I swear…
who pays to maintain the network? This is not a cryptocurrency, whoever does the mining needs to be paid for their spent resources, and it won’t happen automatically
That’s a good point, people make nodes because the incentive helps make sure there are enough servers on the network to keep it secure.
However, back in the days before blockchain we had SETI. So a case could be made that people will volunteer resources for something that mutually benefits them. Protecting ourselves from doctored media and deepfakes would be a pretty good incentive.
Then again, there are a lot of different cryptos tied to tasks already - like using phones as nodes in a mesh network, using a decentralized search engine, learning about crypto itself, etc. If blockchain turned out to be a good way to verify media, there could be a pay off for joining the distributed ledger.
How does this protect the blockchain from someone just uploading hashes of AI generated video though?
It doesn’t prevent every falsification. It makes it much harder.
Say the incident is a car crash. And assuming dash cams also get this blockchain feature. The car crash already happened and you cant fake a video afterwards that make it look like the other person hit you first. And if you try to preemptively fake a video, you cant know every possible roads, roadsigns, nearby cars, or what vehicle the other person is driving, basically you cant predict everything that was on the scene before the incident occurs.
Imagine if you hit a truck at 5 PM heading west on Road 27 and on the intersection on Road 52. You’d have to know beforehand the road that the incident will occur on, the position of the sun (its 5PM and you’re heading west, remember), the road signs, how wide the road is and how many lanes, the fact that the other vehicle is a truck, what the truck looks like, etc.
I mean you have to create so many fake vehicle collision videos then when an incident happens, you’d have to hope one of the ones you faked matches the situation, then quickily find the video and send it to the blockchain.
Not to mention, the other person could have a dashcam video without any discrepencies. And any slight discrepency on your faked video would make court believe the other recording more than yours.
I mean its not impossible fake something. But its hard to do it before something happens.
It still doesn’t prevent me from making a camera that generated ai with timestamps, real block chain, and instead of capturing pixels from lens, generates then from a prompt that says " politician bribes etc etc"
Probably nothing, but that depends on your definition. Let’s look at the technicalities.
You have a number of crypto transactions that are bundled together into a block. Then you compute a hash - a checksum - for this block. If the data changes, then the checksum no longer matches. The trick that makes it a chain is to include the checksum of the previous block in the next block.
If someone manipulates the transaction history, they need to recalculate the checksum to match. But then they also need to change the following block and recalculate its checksum and so on.
This is a pruned down version of a Merkle Tree, which was thought up ~50 years ago. It doesn’t have to be a chain. You can allow a block to have more than 1 succeeding block; making a fork. Blockchains are one use of that data structure. Wikipedia lists some others. Git, for example, also uses this.
The bitcoin maker knew to use this trick when he needed it. When Torvalds wrote git a few years before that, he also knew to use it.
When you ask about Blockchain specifically rather than Merkle Trees, you greatly limit what can be done with it. So there aren’t a lot of uses left. Most people would say that a Blockchain is more than just a limited Merkle Tree. When you add in those features, you make it even more specific to the original application. So you are probably left with just crypto.
It’s a reasonable technology choice for whenever you need to have a ledger that is shared between multiple parties. Blockchain gives you an immutable (un-editable) history of transactions, including who made it, what it was, and where/when it happened, and gives all of the parties who are allowed to edit the ledger a way to trust in the outcome, even if the parties don’t trust each other.
