Comment by anonymouskimmer
3 years ago
We did not have an alternative to electricity for all of the things electricity could power. For some of the things alternatives to electricity continue to be used (e.g. oil, gas, or wood heated homes; windows for light; combustion engines and fuel cells for automotive power).
> You obviously have some understanding of the system if you can speak about bots and front running.
What I've read on crypto skeptic blogs. So basically my understanding is equivalent to the understanding that anyone gets from reading news articles written by content-expert journalists. From what I understand the front-running in crypto can have pretty egregious effects, and can occur with simple monetary transactions, not just the crypto equivalent of stock market transactions. (Yeah, sure, front running can occur in currency exchanges in non-crypto, too, but as an individual, when you go to a currency exchange, or make a purchase overseas, you know the exchange rate before you trigger the exchange.)
> Today, people actually appreciate the immutability of transactions.
I don't. And I don't see how this follows: "It enables the effective store of infinite wealth as a basis." Infinite wealth cannot exist. And how does immutability facilitate this? And how is a blockchain that can technically be rewritten at non-infinite cost immutable (i.e. the MakerDAO rewrite, or any Sybil/51% attack)?
> Credit card companies are providing the reversal business, which is paid for by the people who are borrowing money at insane interest rates... no reason why it can't be replicated once there is enough demand for it, but honestly, I'd rather move to reverse the model.... over collateralized loans.
From what I understand, the interest rates go to the issuing banks, and the credit card companies take their profit from fees. Credit cards (and payday loans) exist for people who lack the collateral for a non-signature loan (without having to collateralize their freedom, aka debtor's prisons or endenturing). The only way to do this in crypto is to trust a third party lender such as Voyager or Celsius.
Front running a transaction is essentially a sandwich attack. It primarily happens in illiquid markets where someone sees a transaction in the mempool, does a large flash loan borrow to affect prices, then your transaction executes at a poor price point, and the loan is paid off. All in a single block. 1) Typical transactions are not front run. 2) There are ways of preventing front-running. This is not really an issue for the majority of users or a design flaw.
> you know the exchange rate before you trigger the exchange
You know this in crypto too. The issue is that the market depth might not be large enough to support your transaction. That will change over time, or you just stick with the basics... BTC/ETH/Stables and ignore the rest of the stuff.
> how does immutability facilitate this?
If you know that it is impossible to double spend, you can trust the math.
> And how is a blockchain that can technically be rewritten at non-infinite cost immutable
This is well covered in Andreas Antonopoulos videos on YT.
> Credit cards (and payday loans) exist for people who lack the collateral for a non-signature loan.
In Vietnam, there is no credit reporting agency. You don't get a credit card from a bank, but you can get a MasterCard/Visa "credit card". The thing is, they are effectively debit cards because you have to time deposit collateral in order to use them. People still get to shop online, but they are limited. This is honestly a far better system because it encourages people to spend what they have, not what they don't have. I also prefer to cut out the middleman who's generating all those fees for both the merchants and the end users.
> The only way to do this in crypto is to trust a third party lender such as Voyager or Celsius.
Bad examples given that Celsius was a ponzi. There are decentralized lending protocols. AAVE is a good example.