Topic: Decentralization is not the answer (Read 1609 times)

+1

*Kind of reminds me of the push back when OOP first came on the scene.  Object oriented code is always better than not right?  Not necessarily.

You are talking about a forum which is different then a currency or a P2P payment method.

A P2P currency can have a set of rules that can be enforced by the miners. The rules are very cut and dry and is obvious when a rule is being followed or not.

A forum can (and should) have rules, however when people are discussing various topics judgment needs to be made to determine if a rule is being broken or not. If the community feels like the rules are not being followed they could easily leave the forum as the forum itself has little value to it's members.

Are you serious? A social network is already decentralized by its very nature. Facebook is not a social network.  Facebook is just a social network mediation service.  The only reason people use a centralized website for that in the 00s and 10s is because websites are easier to program and maintain and the technology of p2p applications hasn't caught up yet, especially in terms of UE.  Trolls and spammers are not an issue in a high trust environment where you get to choose who is allowed to communicate with you.  They have only become an issue for Facebook users who don't use Facebook as a social network, ie. people who have lots of strangers as Facebook friends.

I would be very surprised if 20 years from now social networks are still mediated by centralized websites. Everyone is going to have their own agent that communicates with other other people's agents via standardized interfaces. The power and flexibility offered by agents is no match to a one-size-fits-all website.

As for decentralization of leadership, I agree that there is no replacement for a human leader when it comes to giving a group of people vision and inspiration.  One aspect of leadership can be decentralized though: power.   Democracy is an attempt to do just  that, though it didn't quite get there because it still relies on human power custodians.  DACs could take this one step further and replace the custodians with consensus networks.

I don't know why but I figured this post was the OP and was the exact opposite of the title of the thread...  I just thought was amusing and that I should share.  I also wanted to point out you made excellent points the I agree with thoroughly.

MtGox was twice the size of Lehman (relative to bitcoin money supply) by some measures, and vastly larger by others.  Yet its failure didn't destroy bitcoin--in fact it is already begining to make it stronger (proof of reserves, better wallets, increased awarness of counterparty risk).  This is because the bitcoin economy is robust, unlike the babied fiat economy.



Except for the last century, and isolated incidents before that, we've had hard money for thousands of years in the form of gold and silver.  To say that it didn't work is crazy.  

Hard money is not mutually exclusive of community organization.  They're two different things.  Money is just a construct used to solve the double-coincidence of wants problem.  Saying you can't have hard money and community organization or forms of governance (or even economic stimulus) is ignoring almost the entire history of humanity.  



Bitcoin is simply a useful technology.  It is a peer-to-peer electronic cash system that allows users to store, transport and exchange funds with other users across the world, without the assistance of a third party or the permission of an authority.

But people are scared of new useful things because their subconscious knows that it will reshape the world and their interpretation of reality.  People were even scared of physics hundreds of years ago because "no man can understand the motion of the heavens for they are God's creation."

This is why you are here.  Your subconscious already knows that bitcoin is useful, but your current perception of reality doesn't allow you to see why that is.  So you come to a forum filled with people interesting and excited about bitcoin to try and remedy the cognitive dissonance that fills your brain.  

Easy to say when the economy is niche and tiny.  You can't compare Mt Box to TBTF.  If AIG was allowed to fail.  I wouldnt even wanna imagine.

I realize most people here think of money in terms of micro economics and that's why all the arguments tend to relate back to the individual.  What they don't understand is that things are very different at the macro level.

Inelastic money doesn't work at macro level.  Some things should be decentralized but organizations need top down control.  This should be instinctual if you've gone to school, played on a basketball team, work in a corporation. We humans are social animals.  We expect to be governed.  That's why our civilization flourish.

Bitcoin has become such a cult that "believers" think its the cure to the worlds ailments.  The economic crisis we are facing is mostly about regulation, systemic risk, globalization and wealth inequality.  Who cares about central bankers and FRB?  Who cares aboit bitcoin except the technology to transfer money.  Those are red herrings creating diversion from the real issues that needs discussion

Well said.  Bitcoin is a harsh but just system that favours the innovative and the efficient.  Innovation and efficiency is good for everyone because it helps us to satisfy human demand while minimizing resource misallocation.  

Central bank policy ultimately results in a severe misallocation of resources.  In 2008, free markets were telling us that many financial institutions needed to fail and be terminated.  Yet central banks bailed out these institutions with resources taken from productive sectors of the economy.  Now we are still dealing with these nonproductive financial institutions and the productive economy is suffering.

Now look at the bitcoin economy.  Over the past few months, free markets were telling us that mt gox needed to fail, which was an extremely large player.  If bitcoin were managed by a central entity, that entity would likely have chosen to create enough bitcoin out of thin air to bail out mt gox and punish those who had diligently stored their coins.  It doesn't look pretty short term, but longer term the bitcoin economy will prove much stronger without this failed exchange.  We are already seeing multisig and proof of reserves systems come online with other exchanges attempting to prevent a similar fate.

Bitcoin has a history of weeding out weak players, which is necessary to strengthen an economy.  The media likes to tout the significant numbers of exchanges and wallet services that have failed, but these failures are a positive because it eliminates the weakest links in the bitcoin chain, forcing innovation, and solidifying a strong economy.  The crypto-economy will experience significant growth going forward while the legacy system will continue to deteriorate.

http://twister.net.co/

http://www.altchain.org/

You were saying? Also, a lot of the problems you describe are due to a lack of block/ignore function so if that's installed then there's no real problem like on these forums.

If something is abstract, it doesn't mean that it is not real or important.  Gold is physical but the concept of money that human's ascribed to gold throughout history was abstact.  Yet the fighting to acquire more of it sure was real.

If something is abstract, it doesn't mean that it can be changed.  For example, the real number line is an an abstraction built starting with the "concrete" integers 1, 2, 3, …  Because the concept is an abstraction, does not mean that its reality is malleable.  


I'm saying something completely different: saving plays an important role in increasing the demand for money.  It helps the free market determine interest rates.  


The severe reparations demanded by the Allies is why the "Central control" printed so much money.


If everyone was using bitcoin, how could the Allies have seized their money?  How could bitcoin have been devalued to pay the unpayable reparations?  The wealthy class in Wiemar Germany did better than the middle class because the factories (owned by the wealthy) were not seized while the money (the largest asset of the middle class) effectively was.  



You haven't made any point at all that supports fiat currency.  All you've shown is that fiat currency, war, centralized governments, and treaties signed by bureaucrats tend not have the best interests of the people at heart.



Boom and bust cycles existed under hard money (gold in the past and bitcoin in the future) and under soft money (fiat money today).  The simply represent the cycle of hope and despair, excitement and fear, that play out over and over.  The bust is what liquidates the inefficient businesses so that a new more productive cycle can begin.  

Central banks try to solve a problem that doesn't exist and in turn create a larger one.  In addition to bailing out TBTF bankers and funding war, stimulating the economy also leads to malinvestment and the exploitation of our natural and human resources.

Think about it: if the economy was less "stimulated" would we be using up our natural resources at a faster or a slower rate?  Would people have more or less free time?  A highly stimulated economy is a terrible thing because it leads to waste (more resources used than necessary) and more stress (people work longer hours).  



Central banks exist because of the "deflation is bad" myth.

For a myth to be adopted by a society, it must have at one point in time been useful.  Between 1700 - 1900, England was on a hard-money standard and price levels over these two centuries were fairly stable (although sometimes volatile).  The "deflation is bad" myth had not yet been adopted¹.

Around the turn of the last century is when the "deflation is bad" myth truly took hold.  Our productive abilities were increasing extremely fast--so much could be produced with so little human input.  We had the factories in place to increase real output Q (from M V = P Q) and the will of the capitalists to push technology forward, but with a fixed-supply currency the only way Q could increase was if price levels P decreased.  

We didn't have the internet back then and efficiently communicating real-time prices was difficult.  Q increased only modestly, but since productivity had improved to such an extent, there was less work available an unemployment increased during the Great Depression.  And thus was born the myth that "inflation is good."  The Fed increased the money supply M (by devaluing the dollar vs gold), which allowed Q to reach its potential without the fast drop in P that would have been required due to mankind's rapid advances in productivity.

The first thing the increased Q went to was WWII.  We could produce so much stuff that we had to destroy it in order to keep the people employed!

But this got the people working, validated the "inflation is good" myth, and gave birth to our modern consumer economy.  Our consumer economy is a relic from the Great Depression that says that if we don't consume our resources fast enough then people will lose jobs and will be back in a depression.  

Our "deflation is bad" myth stems from our grandparents' inability to communicate real-time prices in 1933 efficiently enough to just let P fall to where it needed to be.  

The dominant theory of 2008 crisis is caused not by monetary policy but by:

Deregulation
Repeal of Glass Steagal
Increased shadow banking
Increased speculative activity (prop trading
derivatives
MBS
sub prime mortgages
over leveraging on toxic assets
Which lead to systemic risk

Bitcoin addresses none of these issues.  These issues has nothing to with decentralization vs centralization

Only a tiny fraction of banking is storing peoples money.  Most of their business is creating financial products.  

Bitcoin solve the issue of having to use a middleman or having to trust somebody to do their part of the deal.  As far as a transparent transaction between two or more people is concerned.  Bitcoin solves many other problems in regards to economics, just look at Argentina and other places that gave people options to store their wealth during times of economic uncertainty.

Now there is no problem if each bank had their own currency because they could be converted instantly.

Money is a medium of exchange. Giving it another purpose, such as stimulating economic activity, will interfere and create problems.

Fractional reserve banking and central control are significant factors in boom and bust cycles. The Federal Reserve was created shortly before the Great Depression and their mismanagement is thought by many (including Bernanke) to be a contributing factor.

That's all nice and cozy when you are sleeping. But the central banks aren't asleep. From the banks' points of view, the only reason for their existence is to tax people through inflation, and to tax governments through creating fiat out of thin air, and then loaning it to them, and then making them have to borrow more fiat to pay the interest on the loans, and then borrow more to pay the interest on THOSE loans, etc.

To the banks, it's all about taking up ownership of the world. The banks play the protect-everybody-from-depressions-and-hyperinflation game so that they can continue to rape the people and the governments of the world. There is no other reason. The banks are farming. And we and the governments of the world are their cattle.

Bitcoin completely throws a monkey wrench into their plans to take up ownership of the whole world!

decentrilization is key and so is taking things that worked from the current system.  You can't expect an issue as complex as this to just be black and white, yes and no or right and wrong.  You will waste time trying to disprove either method if you ask me.

So if money is abstract why care about the value?  Why not give everyone a billion BTCs so they can trade w it?  Why not keep making more BTCs so every newborn receives a billion upon birth?

Youre not saying anything different than me.  Money is for stimulating economics not hoarding.  Any money if it is to be useful needs elasticity and discipline.  BTC only has discipline.

Weimar hyperinflation was caused by severe reparations demands imposed by Allies.  Bitcoin wouldnt have done squat because after Britain and France took their gold, they proceeded to take their factories and productive output.  Anyways, my point is that boom and bust cycles can get swung to the extremes and what results is calamity and chaos.  Maybe I didn't word it clear enough. 

Bitcoin doesn't solve any economic problems.  Because money by itself can't solve all economics issues.  Central Banks can't solve all economic issues.  But Central Banks play vital role in that they can backstop a recession before it becomes depression, act as lender of last resort, buyer of last resort, etc..  Seems to me like bitcoiners don't understand why Central Banks exist in the first place.

Its not even about money per se, its about liquidity.  Invent a crypto that deals w liquidity issues and I'm sure everyone will get on board.  Until then good luck convincing the masses to join your pump and dump

Let's not try to compare decentralize with socialize. They are two completely different things. Yet they can be present simultaneously.

In the case of Bitcoin, decentralize means no central manipulative control by the few over the many. Yet socialize means everybody and his brother and sister swapping bitcoins for products and services, right from lowly person-to-person trades, to gigantic trades between giant corporations.

Socialize all you want. But keep Bitcoin decentralized.

I agree that the blockchain is a P2P public ledger system.  There are 21 trillion spots on this ledger (each spot is 1 bit).  



I disagree here completely.  Money is always an abstract concept.  It is useful because it helps solve the double coincidence of wants problem that a pure bartering economy faces.  Bob is willing to trade Alice his apples for some bits on that unforgeable global ledger because he knows that Carol will clean his house next week for those same bits.  



I would say that the supply is limited with a known timeframe.  It is "artificial" in the sense that the limitation is imposed by code that humans wrote, but by that definition language, religion, countries and borders, the government as a concept, and many other things are "artificial" too.  

By that definition, Money is "artificial."

These things are real and powerful.  



The bitcoin world understands this.  As we saw with the Fed and the bailouts of 2008, the incentive is often to lose money.  This means that someone else is making money (e.g., the banksters who got bailed out).  



Central banks are political tools.  They increase the money supply when it is politically expedient, for example to bailout banks or to pay for war.  Since it is more politically expedient to increase money supply than decrease it, we find ourselves in the situation where the dollar has lost over 96% of its purchasing power since the creation of the Fed.

Central banking distorts the economy which leads to malinvestment and the exploitation of our natural and human resources.  



This comment is asinine because the Weimar hyperinflation occurred after a "central control" suspended convertibility of the German Mark to gold and started buying foreign currency at any cost.  It was central control that caused the hyperinflation.  If the Mark had remained pegged, or if the Germans had been using bitcoin, hyperinflation would have been impossible.  

you have no clue. you sound like a highschooler that has just read a leaflet on banking and think you know it all..

seriously, do some research. do not reply, do not move to a different thread to try proving some masculinity complex that you know something others do not. instead get some research done beyond the top layer of propaganda and carefully worded history..

i wont even bother correcting you as that is just asking for you to reply. so like i said, dont reply, just go back to your research, peel off a couple layers of the info that was spoon fed to you and looker deeper.

fuck it, ill give you a hint
" The Central Banks incentive is to keep their economy going."

their...
say it 5 times
Their, Their, their their their economy.

so lets peel away a layer for you and allow you to see the rabbit hole. bank notes are a patent and copyright product of banks. they do not belong to you. you are (for want of a better word) licenced to use it. you are by law asked to work a minimum of 1 our to receive atleast $7.50. you are by law then asked to give a portion of that to government. you are by law asked to not use any other currency to pay for fines or court fee's government services etc. you are asked by law to declare your identity if holding more then certain amounts.

it is their product, it is their CONTROL. and you are a lemming by doing as they ask, instead of aspiring for something different, better that does not hold you to so many laws.

now walk down the rabbit hole and peel back the layers. you need to research harder before even attempting to think you know about economics.

fiat does not belong to the people. people are not the masters of FIAT, they are the slaves

again dont reply. simply go do some research layers deeper then your limited knowledge

I don't believe that everything needs to be decentralized. In fact I think many things are better with a singular focus that only one person, or a small group is in charge of.

That being said - I don't think you guys are thinking enough "outside the box." Decentralized social networks could totally work. If everyone is moderating all kinds of cool, uncool and different things could happen. Entities could build reputation and the more reputation an entity has the more it would bestow on others, so "bots" wouldn't be able to gain any "rep" so they wouldn't be able to bestow it. Think of the complex algorithms that could be created, keeping track of how funny, insightful or compassionate different posters are. The possibilities are limitless.