This is a gold rush
January 12, 2022 8:50 AM   Subscribe

Signal founder Moxie Marlinspike weighs in on web3: When people talk about blockchains, they talk about distributed trust, leaderless consensus, and all the mechanics of how that works, but often gloss over the reality that clients ultimately can’t participate in those mechanics. All the network diagrams are of servers, the trust model is between servers, everything is about servers. Blockchains are designed to be a network of peers, but not designed such that it’s really possible for your mobile device or your browser to be one of those peers.
posted by Cash4Lead (143 comments total) 52 users marked this as a favorite
 
Perhaps this is the type of article I should have posted yesterday. The piece I did post was removed, perhaps rightfully so, and for the record: I'm not into cryptocurrency and I have no plans to "get into" it, but I have a family member and it would be fair to describe him (of course he's a him) as a bit of a crypto bro. Anyhow, I will be making an effort to learn more about NFTs, web3, etc this year. For my own good. Thanks, Cash4Lead.
posted by elkevelvet at 8:55 AM on January 12 [3 favorites]


This is a pretty good look at things from inside where the totally-not-a-pyramid sausage gets made.

I'm a bit wary, since Moxie's got his own cryptocurrency waiting in the wings (and yes, technically this is just a weigh-in on Web3 & not Web3+Cryptocurrency), but I'll take it.
posted by CrystalDave at 9:11 AM on January 12 [4 favorites]


I hope that Marlinspike is right about this being a pipe dream – because I'm a web developer, and most of this is gibberish to me. (I still barely understand what an NFT is, or why you'd want to...do that.)
posted by escape from the potato planet at 9:19 AM on January 12 [4 favorites]


Here's the deleted thread elkevelvet is referring to. Even during its short life, I think there were several comments and links worth checking out.

I consider myself a crypto-skeptic and believe the vast majority of activity in this space currently is pure financial speculation. With that said, there are probably a few useful elements to cryptocurrency if it could somehow be decoupled from excessive energy use (but I'm not fully convinced proof of stake can replace proof of work, so it may not be possible)

Alex Gladstein, from the Human Rights Foundation, has been one of the few voices that has forced me to consider some of the current use cases that have a positive impact on society. Here's a piece he wrote with some examples: Bitcoin Is Protecting Human Rights Around the World.
posted by gwint at 9:26 AM on January 12 [11 favorites]


My tech friends all think Moxie's piece is well written and nicely balanced. If you want to read some negative takes on cryptomania, see the links in my comment on yesterday's deleted thread.

One odd thing about this essay is Moxie never mentions the cryptocurrency he's closely involved with, Mobilecoin. It's been integrated into Signal in a way that may harm Signal's mission as a neutral communications company. I suspect in his mind "Web3" is a different topic than "cryptocurrency built into a chat app" but they sure seem closely related to me.

Moxie just stepped down as CEO of Signal two days ago.
posted by Nelson at 9:28 AM on January 12 [17 favorites]


Is anyone able to explain "web3" in less jargony and theoretical terms?

If I'm reading TFA correctly, a web3 application would be a "serverless" app. Serverless in the sense that its state (and application code, perhaps?) is stored not on a AWS EC2 or RDS or S3 bucket or whatever, but on The BlockChain™. (Is that right-ish so far?)

And if I understand "the blockchain" correctly – well, if "the cloud" means "somebody else's computer", then "the blockchain" just means "lots of other people's computers", right? The whole "massively distributed public ledger" thing?

(Is that right-ish so far?)

Finally: what is the presumed benefit of such a scheme? Sure, sure – it's "decentralized". I guess I'm looking for something more concrete than that.
posted by escape from the potato planet at 9:34 AM on January 12 [5 favorites]


Don't waste effort trying to understand the math/tech behind cryptocurrency and NFTs. As this article demonstrates, it's smoke and mirrors. Just like the dotcom craze, it's another perpetual motion machine that people are currently throwing stupid amounts of money at but is transparently worthless if you care about anything except getting rich. And as always, the getting rich is 100% about stealing value from the pockets of other people, not actually creating something OF value. In this case, it's stealing from crypto bros who aren't as smart as they think they are (some of whom are venture capitalists), assorted rubes, and everyone alive via destroying the environment.

Like the article linked above titled "Bitcoin Is Protecting Human Rights Around the World", it's taking something conceptually interesting (anonymous/decentralized virtual currency) and speeding right past the point that Moxie Marlinspike makes: it's ultimately running on web 2.0 tech, which means it has chokepoints, which means the Powers That Be, once it begins working against them, will shut it down or (more likely) compromise it. The people who have gotten rich off of it, despite their high-minded rhetoric, will be absolutely fine with the compromise if it lets them keep their money.
posted by lefty lucky cat at 9:36 AM on January 12 [43 favorites]


A response by @ncweaver to Marlinspike and his participation in instituting MobileCoin as an executive at Signal, which he has now stepped down from, unrolled here, and its text:

OK, the more I look at "MobileCoin", the privacy focused shitcoin that Moxie Marlinspike was CTO of and then got Signal to integrate the worse it looks. Even by shitcoin standards this is very high on the fraud factor, ignoring the pre-mine.

The whitepaper. [pdf]

How does this give privacy? Poorly.

The primary privacy mechanism is the ledger runs inside the SGX enclave. Which means if SGX works, nobody can ever verify the ledger! You are literally trusting the nodes in the system.

There is a secondary defense (public keys are use-once), but that is pretty easy to rip through with flow analyses. Its a little harder with 0 wallet reuse, but not that much worse really all-things-considered. So the privacy in the end rests almost entirely on SGX working. But wait, SGX DOES NOT WORK! The idea is SGX isolates computation in an enclave that the broader computer can't see. But it got broken so hard and so many times that Intel discontinued it! So in reality the real security is "No hostile nodes allowed!"

But wait, its even worse. You see your private key is backed up with just a 4-6 digit pin into the SGX enclave on the node. So your private keys are only private as long as SGX actually works! A corrupt node and your keys get stolen.

Oh, and there is no "decentralization". The nodes get nothing: all transaction fees go to the foundation itself. Which means the nodes are identified money transmitters, without even the fig-leaf of decentralization to evade the laws here. So only nodes are MobileCoin's own. Put bluntly, the only way as a security professional you would endorse this as a valid "privacy coin", let alone push it out to your huge user base, is if you were faced with a dump-truck full of money.

I hope Moxie's dump-truck was suitably large.


A good, more general thread by @vauorapub, unrolled here, and an excerpt:

The main reason I publicly call out crypto as a scam is because, as an expert who understands the underlying technology, I know people who are not experts rely on me to inform their opinions...

To me, empathy for people who are screwed by the system means a responsibility to say clearly and distinctly, "Crypto/NFTs/etc. are always a scam and if you did not construct the scam then you are the mark"...

Crypto is not a technology of liberation. After 10 years, the only practical uses are negative-sum transnational pyramid schemes, money laundering, and illegal payments (ransomware, illicit drugs, etc.)...

There is no kinder, gentler version of crypto/NFTs/etc that redistributes wealth towards the marginalized. It's a negative-sum game that destroys and centralizes wealth, helping mostly scammers and the already rich...


Some more tweets:

@ReeseW (Reese Witherspoon)
In the (near) future, every person will have a parallel digital identity. Avatars, crypto wallets, digital goods will be the norm. Are you planning for this?

@SwiftOnSecurity
These celebrities tweeting about NFTs are straight up elder abuse...
Yeah grandpa just put your money in this magical cyber pot of JPEG bearer bonds everybody's doing it....
Grandma I'm begging you to just invest in fake solar energy mineral rights on Indian land or some shit anything but the monkey pictures...


@quantian:
Web 1.0: When you get hacked you need to change one of your passwords
Web 2.0: When you get hacked you need to change all of your passwords
Web 3.0: When you get hacked you lose all your money


@toasty
All these NFT people are going to be surprised when they find out JPEGs are lossy.
posted by snuffleupagus at 9:36 AM on January 12 [60 favorites]


What bothers me about the NFT bullshit (apart from the obscene power consumption) is that it can only work outside the circlejerk of greater-fool grifters and money launderers if the entire web is re-oriented around their model of digital scarcity, either through re-engineering it at a fundamental level or doing it de-facto via buy-in from major web platforms. People trying to flip armadillo JPEGs on Twitter might just be trying to make a quick buck, but I fear the idea is just a stalking horse for a new generation of oppressive "web3" DRM that will give oligopolies like Meta Facebook even more power to commodify, financialize, and control the last vestiges of the open web.
posted by Rhaomi at 9:36 AM on January 12 [17 favorites]


Finally: what is the presumed benefit of such a scheme?

Yeah, I'm still waiting for a solid answer to this most basic of questions. I did do a bit of work on a Blockchain project a few years ago. I was just the words guy, tasked to put together some pitches for investors. As far as I could tell (after a few days reading and whatnot), it just seemed to be an exercise in artificially created scarcity ... ... for reasons.

I guess I'm still trying to get a handle on a good reason.
posted by philip-random at 9:39 AM on January 12 [9 favorites]


Alex Stamos: "The best long play is probably crypto forensics companies and Moscow Maserati dealerships."
posted by JoeZydeco at 9:41 AM on January 12 [16 favorites]


Is anyone able to explain "web3" in less jargony and theoretical terms?

Not really, no. It's mostly just an empty hype term. It seems to refer to some broad idea of decentralized Internet infrastructure, with blockchains and cryptocurrency attached. Many of its proponents seem to be grifters and it's hard not to see the whole thing as a fraud. Meanwhile mainstream dollar investors are sniffing a new trend and trying to somehow get in on it. When you look in detail "Web3" means a lot of different things to different people. Moxie's essay is one of the best efforts I've seen to try to pin down and evaluate some specific things called "Web3". But it is pretty jargony and theoretical.

"Web2" was also an awkward coinage but at least it was trying to describe something that already existed. Tim O'Reilly's 2005 article is the key influencing article here; note the table of examples of existing products. There's no analogy to Web3; there's no existing practice that's just being codified with a term. There is a lot of hype and fraud though.
posted by Nelson at 9:42 AM on January 12 [19 favorites]


The reason is always the same, to take money from chumps and/or hide money from cops. Sometimes nice people make a buck or two selling their art/music/whatever by wisely cashing the fuck out as soon as possible. Other than that, it's the purest essence of snake-oil grift the world has seen.
posted by seanmpuckett at 9:43 AM on January 12 [12 favorites]


My own glimpse of the Web3 future came on Christmas Eve, when the mandatory COVID tests we ordered after arriving in a different country, from a company called Eurofins, turned out to depend on a buggy Blockchain-based app, TrustOne. It didn't look like a lot of work had gone into the app itself, which kept popping up wacky messages. But out there on social media, there were crypto bros less excited about public health and more excited that the adoption of this app would pump up the value of some coin.
posted by johngoren at 9:47 AM on January 12 [6 favorites]


The only thing Web3 should be, if we want one as described, is some kind of open protocol and client/server standard for virtual spaces. Literally the Matrix from Shadowrun.

But as we keep re-discovering virtual reality interfaces are actually piss-poor for most productivity purposes -- even minority-report style augmented interfaces are pretty bad -- and will remain so until we have actual holodecks or otherwise can access the VR space without a bunch of clumsy wearables that isolate you from real space.

And I don't know if I want to work in world where your office/cubicle is also a holodeck, with the surveillance and expected reachability that implies and is already an issue with the monitoring suites imposed for work from home.

This Walmart metaverse shopping promo has been widely lampooned, but it reminded me of these pieces I've linked here before...

2010: Augemented Hyperreality -- Domestic Robocop

2016: Hyper-Reality (city scenes and shopping)
posted by snuffleupagus at 9:49 AM on January 12 [4 favorites]


This is a really nice essay! It feels as if it were written just for me, and my own particular web3/nft/etc. concerns.
posted by Going To Maine at 9:54 AM on January 12 [4 favorites]


Crypto is not a technology of liberation. After 10 years, the only practical uses are negative-sum transnational pyramid schemes, money laundering, and illegal payments (ransomware, illicit drugs, etc.)...

I think enabling payment for illicit drugs could be framed as a technology of liberation. That’s kind of it, though.
posted by atoxyl at 9:59 AM on January 12 [12 favorites]


Does everyone remember that story about Antoine-Augustin Parmentier having guards posted at the royal potato fields of King King of Kingland's to make the peasants be interested in potatoes as a new dietary staple ?

I think that is the deal with NFTs. These projects are trying create this idea of a resource having different levels of reality (original, copy, copy of a copy, photo of a copy) that can affect their dollar value even if they are just fiat's fiat.

And I think that there is some reason to hold this idea in our heads for a bit. Because the idea can be useful outside of the art/music/pop world. Like I have print of a painting. My print is not worth much to anyone but me. But its dollar value is literally based on what other people think of the original.

And it reminds me also of the Bowie Bonds

https://www.metafilter.com/131693/The-Man-Who-Sold-the-Bonds

And just like those these are not hard to figure out what it is all about: Money.
posted by NoThisIsPatrick at 10:02 AM on January 12 [5 favorites]


A recent recurring TV ad I see attached to NBA games is for Alto IRA, a company encouraging customers to “invest your retirement dollars in alternative assets … like crypto coins, shares in securitized artwork, or venture capital.” Crypto stuff has appeared all over sports sponsorship in the past few months: the Lakers and Clippers now play in Crypto.com Arena and the F1 Championship was visibly supported by multiple coin brands. Think this mass-marketing is a sign that crypto has reached the final level of the pyramid scheme.
posted by migurski at 10:03 AM on January 12 [9 favorites]


“What if we ran a website, but in a torrent?”
posted by aspersioncast at 10:15 AM on January 12 [24 favorites]


But seriously does no one remember Limewire? I want to read the white paper on how any of this makes more sense than existing proof-tested p2p systems.
posted by aspersioncast at 10:21 AM on January 12 [2 favorites]


I read the OP, but then got sidetracked by Moxie's trip to the Chernobyl Exclusion Zone...
posted by schyler523 at 10:24 AM on January 12 [1 favorite]


The huge push right now is to fleece grandma's retirement savings before the regulators and taxing authorities catch up. That's the tech-bro business plan in a nutshell: "disrupt" is just "break the law before the law can even be passed." Fuck 'em all.
posted by seanmpuckett at 10:24 AM on January 12 [23 favorites]


I recommend waiting for web 3.1, after the early adopters have submitted bug reports.

The bits I understand sound a lot like usenet. But less useful or well documented. (I also don't understand why a browser or phone should be a server. My browser is a terrible network analyzer. That doesn't mean such things aren't useful. Whether or not this is useful or how many independent servers should exist seems like a different question than whether or not you browser can do it.)
posted by eotvos at 10:38 AM on January 12 [4 favorites]


Speaking of Tim O'Reilly, he's written an article on Web3 which I found interesting.
posted by Slothrup at 10:39 AM on January 12 [4 favorites]


I recommend waiting for web 3.1, after the early adopters have submitted bug reports.

I think Web NT will be where it's at. Web 3.11 will finally be usable and have a good GUI, but Web NT will have better security.
posted by a non mouse, a cow herd at 10:43 AM on January 12 [41 favorites]


"disrupt" is just "break the law before the law can even be passed."

Or, as sceptical cryptocurrency journalist David Gerard called it, “regulatory escape velocity”.
posted by acb at 10:51 AM on January 12 [28 favorites]


Vitalik Buterin, cocreator of Ethereum, posted a reply on the Ethereum subreddit: https://www.reddit.com/r/ethereum/comments/ryk3it/comment/hrrz15r/

Tldr, he agrees with some of Moxie's critiques as it applies to the current state of the blockchain ecosystem but is optimistic that development will move forward and resolve the issues Moxie points out.

Another response addressing some of the technical aspects Moxie mentions: https://mirror.xyz/suzuha.eth/vb5E5lhzmPTcpxOJcz6Q211TDgSvoFwDLA6JSM1V37Q

There are over 4,000 developers working on Ethereum as of January 2022 according to Electric Capital: https://medium.com/electric-capital/electric-capital-developer-report-2021-f37874efea6d

Yes, there are a lot of people looking to get rich in crypto. And yes, there are also a lot of people interested in the technology that continued through the bear market of 2018 for crypto when Bitcoin lost over 80% of its value in a year.

There is an irrational exhuberence in a bull market right now which is attracting a lot of money so everything gets pumped. It's hard to tell the wheat from the chaff We shall see which shitcoins get dumped and which ones will survive in a bear market.
posted by kuroikenshi at 10:54 AM on January 12 [1 favorite]


“What if we ran a website, but in a torrent?”

That's what IPFS sort of does, and it does work. It's the NFT crap layered on top that is bad.
posted by BungaDunga at 10:55 AM on January 12 [4 favorites]


I was wondering, where did all the developers go who used to work on Adobe Flash.
posted by Lanark at 11:01 AM on January 12 [13 favorites]


Mobile app development
posted by gwint at 11:03 AM on January 12 [2 favorites]


The only "problems" crypto solves are money laundering, creating new opportunities for grift and creating a new source of hype for VCs.

Forget the technology for a moment, which is mainly bad reinventions of already solved problems, and focus on the user need. What user needs does crypto meet beyond those I listed in the first sentence?

I point you all at Brandolini's Law.
posted by fallingbadgers at 11:05 AM on January 12 [5 favorites]


It's hard to tell the wheat from the chaff

That's because it's pretty much all chaff. And grifts, and fraud, and ransomware payments, and the occasional drug transaction where at least goods of value actually get shipped. It's not just a little "irrational exuberance", it's a deliberate financial mania.

The big scam at the middle of this is Tether. When that blows up all that chaff is going to catch fire and if there's a few stalks of wheat left, they're going to be burnt up just like the rest.

Anyway that's just the same tired "cryptocurrency is a fraud" thing. This article is about Web3, which is adjacent but a little different. My broad concern is how we've done a lot of work on decentralization over the years (it's been the center of my career) and a lot of it just hasn't born much fruit for business reasons. Now there's a new business reason, but unfortunately it's tied directly to massive financial fraud.
posted by Nelson at 11:07 AM on January 12 [20 favorites]


We shall see which shitcoins get dumped and which ones will survive in a bear market.

This is assuming that some will survive (and, implicitly, feeding the fantasy that eventually fiat currency will collapse and they will replace it, and the lucky few who got in on the ground floor and HODLed will be driving moon lambos). This is by no means assured; it's also possible that the whole gold rush will crater and everyone will lose their shirt, other than the faithless pickaxe vendors who diligently converted their holdings to real money.
posted by acb at 11:09 AM on January 12 [7 favorites]


I was just writing a comment on that prior thread when it was deleted, which I will paraphrase here:

I am so, so relieved that I'm not alone anymore. I was already on the "all cryptocurrencies need to die in a fire" train years ago, and I was conscious of what a wingnut that made me look like. I am very much pleased to see that other people are starting to come around to that point of view.

This is not a technology of honor. No highly esteemed services are available here. Nothing valuable is here. What is here is dangerous and repulsive to us. This message is a warning about danger.
posted by notoriety public at 11:13 AM on January 12 [21 favorites]


This bit from Vitalik Buterin's response made me laugh:
As for my theory about "why this hasn't happened yet", I would say a lot of it comes down to limited technical resources and funding. It's easier to build things the lazy centralized way, and it takes serious effort to "do it right". The Ethereum ecosystem did not have that much resources up until ~4 years ago.
If they didn't "do it right" when the ecosystem consisted entirely of true believers who actually care about ideals like decentralization, why would they suddenly start doing it right now that the ecosystem is flooded with people with deep pockets who don't give a shit about those ideals and have zero incentive to fix the problems Moxie is talking about? It's way harder to decentralize once you have centralized platforms with disproportionate clout and a vested interest in keeping their position!
posted by Gerald Bostock at 11:14 AM on January 12 [15 favorites]


That's because it's pretty much all chaff. And grifts, and fraud, and ransomware payments

From the Alex Gladstein article I linked above:
In the past few months, Belarusian activists have used bitcoin to defy the regime by sending more than 3 million dollars of unstoppable money directly to striking workers, who then convert it locally to rubles in peer-to-peer marketplaces to feed their families as they protest the country's dictatorship.

In October, a feminist coalition in Nigeria raised the equivalent of tens of thousands of dollars in bitcoin to buy gas masks and protest equipment as activist bank accounts were being turned on and off.

In Russia, the opposition politician Alexei Navalny has raised millions in bitcoin as Vladimir Putin maintains strict control over the traditional financial system. Putin can do a lot of things, but he can't freeze a bitcoin account.

In Iran and Palestine and Cuba, individuals face sanctions or embargoes because of the misdeeds of their corrupt rulers. Bitcoin gives them a lifeline for earning income or receiving remittances from abroad.

Some Venezuelans, having watched their country's currency evaporate due to hyperinflation, are converting their resources to bitcoin's digital format and then escaping. With their savings secured by a password that can be stored on a flash drive, phone, or even memorized, they've started new lives in other countries, taking advantage of a technology that refugees throughout history could only dream about.
posted by gwint at 11:15 AM on January 12 [10 favorites]


Every week I hear the reasons to buy into all this stuff. The family member drank the Kool Aid, and they are promoting the heck out of this. All the language: liberating, revolutionizing, freeing. I have not done any research, but I can't help but wonder how all the circles intersect re: a type of toxic masculinity and susceptibility to these kinds of ideas. I love the family member, he just happens to be young and male and part of a much bigger question.

Edit to add: appreciation for gwint's recent post, because of course this is mentioned in weekly family visits as proof of the "promise of crypto" and frankly I'd be surprised if someone out there isn't finding ways to make this work for them (like, non-harmful kinds of ways)
posted by elkevelvet at 11:15 AM on January 12 [3 favorites]


One odd thing about this essay is Moxie never mentions the cryptocurrency he's closely involved with, Mobilecoin. It's been integrated into Signal in a way that may harm Signal's mission as a neutral communications company. I suspect in his mind "Web3" is a different topic than "cryptocurrency built into a chat app" but they sure seem closely related to me.

I think that the essay has a subtext that Marlinspike thinks that blockchain has some sort of role in the future: he explicitly says he thinks that the money rolling around it is going to stay in the space and not just disappear into other things. It’ll be interesting to see if he can spin things towards solving usability issues - he’s certainly done it before.
posted by Going To Maine at 11:19 AM on January 12


From the Alex Gladstein article I linked above:

If the argument is "we can't have financial controls because corrupt governments", I'm not buying it.
posted by notoriety public at 11:20 AM on January 12 [10 favorites]


I was going to quote the person who said cryptocurrency is GOOP for the Joe Rogan crowd, but, in trying to find out who said it first, I instead learned that both Joe Rogan and Gwyneth Paltrow are promoting cryptocurrency thingies of one kind or another, so now I'm going to go with that tidbit instead.
posted by box at 11:20 AM on January 12 [14 favorites]


As an AI researcher, it's kind of funny to me that the thing we definitely can't manufacture turns out to be trust.

Also, at this point, who else is just waiting for the shoe event horizon?
posted by kleinsteradikaleminderheit at 11:29 AM on January 12 [13 favorites]


One point I think is important to make here is that the reason that people are referring to "The VCs" as if they were these rich, mythical creatures separate from us is that normal people are banned from investing in most of the lucrative things in the traditional financial system - such as providing startup capital for brilliant new ideas.

You can't provide 100 dollars of venture capital in the traditional world. You certainly can now. Are there thousands of barely disguised pyramid schemes, scams, and filthy NFT-related shenanigans? Absolutely there are, but I am grateful that someone who wants to really research projects, read code and think deeply about it can find gems that are truly brilliantly done and invest in them.

You can access some of the investments that have traditionally been intentionally withheld from the plebeians and reserved for the very rich. That's a good thing.
posted by Barry David at 11:38 AM on January 12


I wish I could remember where I first read it, but to paraphrase:

"The biggest indication of crypto being a scam is that porn hasn't adopted it for widespread use."

The point being, porn is often a surprisingly early adopter of technology. Porn drove VHS sales. Porn got people interested in virtual reality. Porn moved to the Internet, and porn drove online payment processors (before, of course, they abandoned porn as soon as it was expedient).

If crypto was actually a useful technology, the porn industry would have found a way to adopt it.
posted by explosion at 11:39 AM on January 12 [23 favorites]


That's an amusing thought, I guess – but I hope you're not posing it as a serious argument against crypto. There are plenty of technologies which are useful, but not to the porn industry.
posted by escape from the potato planet at 11:41 AM on January 12


All the language: liberating, revolutionizing, freeing. I have not done any research, but I can't help but wonder how all the circles intersect re: a type of toxic masculinity and susceptibility to these kinds of ideas.
Here is an AskMe that might ring true for you, Twitter thread explaining the links between 'hard money' and racism. Nut:
Bitcoin is designed to be “sound money.” It can’t be controlled by government. What’s mine is mine, what’s yours is yours, and can’t be “diluted” by shadowy “central bankers,” lurking in their urban apartments, smoking cigars — or worse, eating lox bagels. – Dave Troy
Counterpoint in this thread.
posted by migurski at 11:43 AM on January 12 [4 favorites]


From the Alex Gladstein article I linked above:

The US government estimates that ransomware payments (only payments, not the total cost of prevention, payments, and losses) were over $416 million in 2020 and likely topped $1 billion in 2021 [pdf]. The total cost of ransomware has been estimated at $20 billion in 2021.

Ransomware depends almost entirely on the existence of cryptocurrency. It routinely threatens essential government services, infrastructure, educational institutions, and healthcare services. It is also a major funding source for organized crime and repressive regimes such as North Korea.

Any argument for the net value of cryptocurrency has to first explain why cryptocurrency is worth the massive, growing global cost of ransomware, which exists only because of cryptocurrency and will continue to exist as long as cryptocurrency exists and has liquidity.

I'm glad some value has been eked out of the ecological and economic disaster that is cryptocurrency, but it almost certainly isn't worth it in the big picture or the long run.
posted by jedicus at 11:47 AM on January 12 [23 favorites]


Check out the link in jessamyn's answer to a question about the connection of crypto to previous manifestations of 'hard' currency fever and its unbreakable bond with racist/gold bug/fascist/eugenicist/Koch/sovereign citizen movements historically
posted by jamjam at 11:52 AM on January 12 [5 favorites]


I found this funny:

The cost of making a visual contribution increases over time, and the funds a contributor pays to mint are distributed to all previous artists (visualizing this financial structure would resemble something similar to a pyramid shape).

posted by chavenet at 12:04 PM on January 12 [9 favorites]


That's an amusing thought, I guess – but I hope you're not posing it as a serious argument against crypto

Not as a serious argument so much as an emotional one.

Kind of like how for people who think the moon landing is fake, no amount of hard evidence seems to be enough. But you can point out that it was during the Cold War, and the Soviets would have called it out as a fake in a moment if they could. That can cause some people to stop and think about it.
posted by explosion at 12:16 PM on January 12 [9 favorites]


That's what IPFS sort of does, and it does work. It's the NFT crap layered on top that is bad.

Right?! I mean this is sort of a solved problem since Cloudflare became ubiquitous. I feel like in that quoted section in the FPP either Marlinspike is playing fast-and-loose with the definition of a "server" and/or is actually drunk on his own juice.
posted by aspersioncast at 12:35 PM on January 12


If crypto was actually a useful technology, the porn industry would have found a way to adopt it.

After getting blackholed by Visa & MasterCard, the main way PornHub accepts payments is with bitcoin. Doesn't mean bitcoin isn't still a tire fire, but people have found uses for it. Of course that's still not "web3." I'm sure there are porn NFTs around though.
posted by BungaDunga at 12:42 PM on January 12 [4 favorites]


"Yeah, I'm still waiting for a solid answer to this most basic of questions. I did do a bit of work on a Blockchain project a few years ago. I was just the words guy, tasked to put together some pitches for investors. As far as I could tell (after a few days reading and whatnot), it just seemed to be an exercise in artificially created scarcity ... ... for reasons."
posted by philip-random at 11:39 AM on January 12
This is exactly what I tell all the marks. Or try if they could get their heads out of their asses.

1) There is nothing blockchain provides of "web"/decentralized value that can't be done with a clever use of DHT, Git and basic non-energy hogging crypto (SHA, etc...)
2) The fact they're throwing "crypto"/blockchain onto it is precisely because they want artificial scarcity.
3) This scarcity then generates artificial value, which then makes your distributed site a commodity to be purchased.

The idiots run around saying "web3 is decentralized, YOU will own it, it won't be Mark Zuckerberg"

You can run your own servers now, assholes, Why aren't you? Is it because it's hard?
Why is Zuckerberg and Capitalist Vulture Marc Andreesen getting in on this action? Because it's going to destroy their own empire? Or is it because they know they can just "buy" your little site and all you're doing is hoping to get in on the grift and get a payout for your dumbshit nobody wants.

If you want a web not controlled by giant social media players it already exists. It's called web1. Pay for a server and run it. You can still do that. You want decentralization? Like I said, build it. Nobody is. Why? All SORTS of open source projects exist and work on things. In fact long before Satoshi ruined everything there were many many decentralized web projects being worked on (though I think they were trying too hard to reinvent the wheel - like I said, we already have standard tech with DHT, GIT and strong enough security) Project Appleseed is the first one that comes to mind (mostly because the name stuck with me) There were many many others at that time (around 2005-2007).

So why aren't people doing this? Why is it suddenly a craze?

Besides cryptocurrency and NFTs, where is this vaunted "web3" Create a server. How is it supposed to work, give details? Perhaps some exist, but I haven't seen anythign it's all hype. And why would I want every single web page to burn a continent of trees. (and like someone said above : I am skeptical of PoS claims)

Sorry my point is: This is all a bunch of assholes trying to create a bubble and get in early so they can leave before it pops. And the really big players already are looking to buy it all out and privates is.

It's 100% enclosure of the commons - it's 100% the OPPOSITE of what we old schoolers wanted with the internet ("Information wants to be free"). Aaron Swartz died and you fuckers want to make sure everyone has to pay for everything and that's not hackers, that's just silicon valley-wallstreet grifters. You lose the right to call yourself a hacker.

Really disappointed to hear about Moxie's role in Mobile Coin as I was thinking of applying at Signal. Now I wonder why I should bother if he's pushing this bullshit. Christ.
posted by symbioid at 12:47 PM on January 12 [50 favorites]


Right?! I mean this is sort of a solved problem since Cloudflare became ubiquitous. I feel like in that quoted section in the FPP either Marlinspike is playing fast-and-loose with the definition of a "server" and/or is actually drunk on his own juice.

No, he's still right. There's still a "web2.0" chokehold between almost all NFT consumers and the on-chain data, and it's the very centralized NFT platforms. Yeah, the NFT data still lives on-chain, but if you don't ever interact with the chain directly, then it's sort of beside the point.

(Cloudflare is also the opposite of decentralized, it's a single company that's managed to solve a big problem- DDOS attacks- by being big enough to handle them. Small players that would otherwise get kicked off the net by a determined script kiddie have to hide behind CloudFlare, which just encourages centralization. CloudFlare will even terminate SSL for you, which makes your green lock a lie- you're not communicating securely with the website anymore, you're communicating securely with CloudFlare, which promises not to do nasty things to your requests)
posted by BungaDunga at 12:48 PM on January 12 [10 favorites]


Re: Gladstein, so all these opposition folks, they readily were able to buy all the millions of dollars worth of things they supposedly got for value in crypto? Or did they, you know. Still have to convert back to actual traditional currency. Yes, black markets exist, and certainly there are players who deal with crypto, but I have a strong doubt that this is all just magic internet money doing the hard work. Someone, somewhere, is making a killing off arbitrage and sales and in the end it's still getting cashed out to "real" currency. Gendler is being dishonest and pretending any transaction on the chain is the same as actual purchases IRL. Some may be pure digital transactions transfers between players, but when the actual value/commodity is paid out, no doubt the majority of it is going to be in cash.
posted by symbioid at 12:51 PM on January 12 [3 favorites]


BungaDinga sorry I had it in my head that Cloudflare's CDN was somehow IPFS-based, but now that I think about it I'm not sure I understand how any of that works.
posted by aspersioncast at 12:57 PM on January 12


CloudFlare does an IPFS gateway, which makes it much easier to put IPFS data on the web. But... it does that by interposing itself as a middleman. You can just talk to the IPFS network yourself but you need an IPFS client, or go through CloudFlare, which is a bit easier and probably faster.
posted by BungaDunga at 1:12 PM on January 12 [1 favorite]


gwint,

I read that article. The first half is the standard cryptocurrency bloviation about how it will help liberate people. But when you get to the actual examples, it kind of falls apart. For example, it says:
Over the past few months in Belarus and Nigeria, nationwide protests have broken out against tyranny and corruption. In both places, activists raising money to support the democracy movement have had their bank accounts frozen.
But the article it links to doesn't say anything about gas masks. And the "frozen bank account" raises the more important secondary question:

How does raising Bitcoin/cryptocurrency help people in repressive regimes? You can raise a million dollars in Bitcoin but, unless the country has already moved to a total cryptocurrency financial regime, don't you need to convert it to local currency to actually use it? Are there many gas mask manufacturers or suppliers in Nigeria accepting pure crypto payments? If Alexei Navalny is raising millions to run against Putin, how does he spend that cryptocurrency for his campaign?

I don't see how this gets around the problem of the repressive government. Wherever crypto touches the real world or the existing banking system, the government can clamp down like it can anything else. Your linked article says:
Vladimir Putin maintains strict control over the traditional financial system. Putin can do a lot of things, but he can't freeze a bitcoin account.
Sure, but if the government won't let you raise money for your cause, it's not going to let you convert crypto you raised into money for your cause, it's going to freeze your bank accounts and arrest you and anyone you do business with. Putin doesn't need to stop Navalny from getting crypto, he just needs prevent Navalny from using any of it in Russia, which he most certainly can.

I keep seeing this "refugees can store their money in their head!" line and yeah, sure, maybe they can, but that money in their head is worthless without the ability to utilize it in reality.
posted by star gentle uterus at 1:16 PM on January 12 [23 favorites]


... or as the folks over at naked capitalism are fond of calling it - 'prosecution futures'
posted by cfraenkel at 1:28 PM on January 12 [1 favorite]


Sure, but if the government won't let you raise money for your cause, it's not going to let you convert crypto you raised into money for your cause, it's going to freeze your bank accounts and arrest you and anyone you do business with. Putin doesn't need to stop Navalny from getting crypto, he just needs prevent Navalny from using any of it in Russia, which he most certainly can.

This exactly. The only reason money works and why people want it is because you have to pay your taxes in it and the government can make your life a living hell if you don't comply. Anything else is just a poor substitute.

I always love watching cryptobros like "oh the fed printed so much money" and it's like motherfucker they had to so we didn't go into a deflationary spiral because your idols have hoarded every other bit of wealth like a fucking dragon. What do you do with bitcoin, a currency that's basically fixed and built for a massive deflationary spiral? You can't increase the money supply because then the network would split and you wouldn't have consensus and you wouldn't have any worth of any bitcoins anywhere. So you just have to shrug your shoulders and sit there on your hands while your economy crashes around you like EVERY FOUR YEARS PRIOR TO FIAT CURRENCY. And I'm not talking "oh the numbers went down" crashes like we get today. I'm talking 25, 30, 50% unemployment that would just randomly fall out of the sky every so often. For shits and giggles put in "panic of" into your browser's search bar and watch Google autocomplete the sordid history of the uselessness that is the gold standard. That's what the cryptobros want to go back to. They can fuck off.
posted by Your Childhood Pet Rock at 1:31 PM on January 12 [21 favorites]


If you want a web not controlled by giant social media players it already exists. It's called web1. Pay for a server and run it. You can still do that

That was the part of Marlinspike's essay I thought about, the claim that within ε no-one actually wants to run a server. Only cranks and grad students, as someone else said recently. Because IME it's true, the sysadmins of my youth are folding up. Or hosting on AWS, which isn't as centralized as moving to Facebook groups but isn't independent.

On Mastodon someone said, solo or corporate cloud aren't the only choices, there's community hosting, which is... Mastodon and Metafilter and ??? I feel like we're a rounding error again, and mostly on AWS to boot. (Though I expect one can define a service standard on cloud hosts that would be closer to a distributed web.)
posted by clew at 1:35 PM on January 12 [5 favorites]


Mastodon and metafilter and ao3... Ao3 owns all the servers so they can continue to host filth without worrying about what the copyright holders think. Dreamwidth is another one that owns their own servers so they can avoid restricting content. Neither of those sites hosts images, audio, or video, tho, which is how they're able to run with money from the community. I think there are a lot of text-based message boards and projects like this.
posted by subdee at 1:46 PM on January 12 [6 favorites]


I suggest: Bitcoin vs. Madoff with several links about bitcoin as a Ponzi scheme. Which links to an article detailing how the pump and dump works.
posted by bdc34 at 1:49 PM on January 12


The only "problems" crypto solves are money laundering, creating new opportunities for grift and creating a new source of hype for VCs.

patently false.

crypto can make it so that large centralized organizations can't tell you that you don't get to access your stored value.

Like a Bank. Or VISA. Or a Trump.
posted by NoThisIsPatrick at 1:53 PM on January 12


True; in this case, it's OpenSea or Coinbase telling you don't get access, instead.
posted by sagc at 1:57 PM on January 12 [13 favorites]


crypto can make it so that large centralized organizations can't tell you that you don't get to access your stored value.


> What I found most interesting, though, is that after OpenSea removed my NFT, it also no longer appeared in any crypto wallet on my device. This is web3, though, how is that possible?
[...]
> All this means that if your NFT is removed from OpenSea, it also disappears from your wallet. It doesn’t functionally matter that my NFT is indelibly on the blockchain somewhere, because the wallet (and increasingly everything else in the ecosystem) is just using the OpenSea API to display NFTs, which began returning 304 No Content for the query of NFTs owned by my address!

Instead *other* large centralized organizations get control! Great job, everybody
posted by CrystalDave at 1:57 PM on January 12 [15 favorites]


You can access some of the investments that have traditionally been intentionally withheld from the plebeians and reserved for the very rich. That's a good thing.

This sounds like a good argument to people who have not read very much about modern-day financial regulation. The point of barring everyone but the very wealthy - "qualified investors" - from certain financial markets is because the alternative is not "ordinary people get rich on their investments."

It's "ordinary people get scammed out of their life savings, over and over and over and over."
posted by All Might Be Well at 2:00 PM on January 12 [20 favorites]


It's "ordinary people get scammed out of their life savings, over and over and over and over."

"That's just for legal reasons, you don't have to worry about it in your case."
posted by Your Childhood Pet Rock at 2:05 PM on January 12 [8 favorites]


(Yeah, the "you can host on your own" and moxies point on the article (I read it a fwe days ago)) was part of my point.)

You CAN do it now, but you aren't. Why is that, Leon?

And how is crypto "easier" (I still don't understand most of it except a quick overview and now you're saying it's easier to setup a web3 hosting (which honestly I still haven't seen anyone provide so much as a server it's just hype this non-existent tech?)

And if the blockchain is immutable, what, exactly, IS web3 about? Does every new page need a new block? And what if you want to edit the block? How does that work? Why put so much effort into something as simple as a page, but yet somehow this is "more" liberating.

The point is - we can do it now and we aren't and there's reasons (like moxie mentioned). And almost all the people I see hating crypto are the old stalwarts who loved the free software/open source/creative commons, and see this for the ruse it is, while a lot of the younger generations who grew up in favor of free software get suckered in by the terms and claims without an analysis of the economic and social formations that led to web1 becoming the centralized web2 and refuse to admit web3 is even worse for co-option (due to "inherent value" of the blockchain).

In my day we called that "selling out" - of course that's what happened in bubble 1.0 too. Everyone wnated to be the next pets.com.
posted by symbioid at 2:06 PM on January 12 [6 favorites]


Because IME it's true, the sysadmins of my youth are folding up. Or hosting on AWS, which isn't as centralized as moving to Facebook groups but isn't independent.

It's still based on open standards and protocols. I can avoid anything dependent on AWS if I choose, mirror my site elsewhere and redirect the traffic as soon as DNS updates. I can choose what software stack I'm running and exercise some amount of control over the disposition of my data, etc. If the host imposes restrictions I don't like, I have options.

Is VRML dead? I see there's X3D now, but I've never heard anyone talk about it.
posted by snuffleupagus at 2:09 PM on January 12 [3 favorites]


You can access some of the investments that have traditionally been intentionally withheld from the plebeians and reserved for the very rich.

The crypto boom has been a long, painful lesson in exactly why those regulations are in place. And I mean exactly why, as it's literally just the same securities scams people ran in the 20s but blockchain.
posted by star gentle uterus at 2:17 PM on January 12 [14 favorites]


The advent of web 2.0 coincided with my years in high school, which were also the years where I was debating skipping college and going the tech start-up route. I was actually interning for a social networking startup and doing research on the other companies in the field when first I came across Facebook, then extremely new, and upon creating an account was immediately convinced that I was looking at the future of the web.

The guy who'd founded the company I was working for blew it off, because—in his words—"They might have the newsfeed, but we have drag-and-drop profile components, and an even better CSS editor than MySpace!" Anyway, he got in touch with me about two months ago looking to start a new project and offered to pay me in Ethereum, so it's nice to know that some things don't change.

Anyway: I was on the ground floor, in my little way, when web 2.0 happened, and I was young enough that web 2.0 seemed like the most exciting thing in the world to me. And I feel sufficiently credentialed to say that Ethereum's own definition of web 2.0 is total bullshit. To wit, they define it as:
An internet dominated by companies that provide services in exchange for your personal data.
But that's not at all a description of web 2.0. It's a description of advertising-sustained free products, sure, but that's also how web 1.0 worked (not that anybody calls it that). People don't like paying money for stuff, so companies showed ads instead, and that racket gradually got worse. That may have happened in parallel with web 2.0, but equating the two is hot nonsense—it's only touted out to promote this bullshit libertarian "web 3.0 is about FREEDOM!" scam that neatly elides how enthused free-market libertarians were about soon-to-be-huge corporations like Google and even Facebook at the time.

The extremely simple, non-bullshit explanation of what happened in that 2.0 era is that web sites increasingly became asynchronous, which let them change from "pages" to "applications". In tech-lite terms, what this meant was that web sites you were looking at could update themselves without your having to reload anything or click anywhere. No asynchronicity means no notifications, no live-chatting, no fluid maps that zoom in/out and scroll without feeling virtually frozen in place, no halfway-decent email clients. It was a relatively minor shift in terms of technical difficulty that opened major possibilities for new developments.

No asynchronicity, no Twitter or Facebook, obviously. But Google—which was a company before web 2.0 was a thing—really expanded when they started aggressively pushing out different kinds of apps that felt like viable competitors to desktop software. Gmail, Google Reader, and Google Talk weren't as technically sophisticated as desktop clients, but they were the first instances of their kind that could feasibly replace desktop applications: not only were they free, but the convenience of running them without installing anything was tremendous. And things like Google Docs used asynchronicity to be better than their competitors at the time, because they could implement features like autosaving and take advantage of the fact that you were plugged in, at all times, to a giant online database that could handle things like file management for you. Even social sites like Tumblr benefitted, because Tumblr's robust theme-development system let you design fancy styles and get results in real time.

Shortly after that period, the iPhone got introduced, and that wound up doing three things that drastically changed the face of the web forever:
  • It radically opened the possibilities of Internet as casual entertainment. Suddenly it was possible to idly check the web from anywhere and everywhere, whenever you had an extra minute. And youth access to the Internet gradually became omnipresent.
  • It killed Flash, which was a difficult and frustratingly slow interactive language. I still dearly miss Flash, but the web got a lot more flexible when Flash went away. And while HTML/JS weren't immediately ready to fill in Flash's shoes, the void left in its wake eventually encouraged some real innovation in that space, which is relevant in a way I'll come back to in a minute.
  • Finally, it ultimately made the web relatively irrelevant, because the App Store wound up becoming such a goldmine that the new normal became native apps tapping into a web backend, rather than web apps per se. This, not "web 2.0", led to the walled gardens that define social media today.
The takeaway here is that web 2.0 was a big deal, not because of any radical political or business shift, but because the web gained a robust new capability, one that immediately led to a fundamental change in what was possible.

The other takeaway is that the web no longer has the same foothold in the computing world that the Internet had in the early 2000s. Back then, software was decentralized, usually cost a shitload—so much so that Mozilla's free email client was thought of as a Big Deal—and the Internet was seen as comparatively quick, accessible, and light. Its ability to offer applications both drew enthusiastic customers and opened the doors for products that fundamentally revolved around online connectivity, whether that meant crowd-sourced infotainment a la Reddit or media-centric communities a la Twitter and YouTube (and, shortly after the iPhone launch, the original Instagram). But apps have become so popular that the World Wide Web no longer holds the same cachet.

Tim O'Reilly's original idea for web 3.0—articulated in the NYT in 2006, probably not worth reading—consisted of two things. First, there was the idea that the web would eventually develop more and more robust forms of vector graphics, which would let it create more immersive visual environments. Second, though, and more importantly, there was his idea of the "semantic web", which was that we'd develop standards for articulating certain kinds of object that we could pass from environment to environment, giving users more freedom over their information: a kind of abstraction that removed the emphasis on individual applications or companies in favor of prioritizing data for data's sake. Dumb example: imagine a "book" object that could exist independently of Amazon or GoodReads or Project Gutenberg, like a standalone Pride & Prejudice unit that each of those other sites could reference without owning. Or a "location" that you could store in your address book, or in a map application, or when shopping, unifying your information while guaranteeing you freedom from any one application's petty tyrannies.

All of the current web 3.0 grifts borrow from one of these two ideas, albeit mostly incidentally—I think there's a sense in which O'Reilly was right, and these are the places where the web can still expand. The Metaverse is a bullshit version of those vector-graphic Internet dreams; much of what happens on the blockchain purports to be somewhat similar to the semantic web. But ultimately, what we've found is that the web has some natural limits. Immersive vector-graphic environments are overkill for the vast majority of what we want to do online, and there's largely no benefit to using the web for what's left (especially since online gaming works just fine—so the big breakthrough "simple" games that catch on are, like Among Us, apps rather than web-based). And the semantic web largely stalled out because the companies that were big enough to make huge, popular services realized they would rather control their own standards than subscribe to open ones. At some point, Twitter and Facebook both had RSS syndication; over time, they've removed it piece-by-piece, in favor of proprietary APIs that let them exert control over developers and users. Apple offers a lot of "semantic-ISH" functionalities, but only for people who stick to Apple hardware. And Google's attitude towards open standards is, to put it politely, convoluted and confused. The web never had another drastic evolution, because there weren't really benefits to its evolving any further. The biggest changes in web development are often initiatives by major companies, like Angular (Google) and React (Facebook), but they haven't been a sea change like the original shift towards asynchronous development was, because there simply isn't a lot of ground to cover.

Blockchains are technically very neat! They even have real-world applications, sometimes! But that's also true of CAPTCHAs, which nobody heralded as the coming of a new age. BitCoin didn't get big because it offered something revolutionary: it got big because it offered a new financial market, with just enough technical legitimacy and just enough rhetorical aplomb that it caught people's eyes. NFTs came about, cynically, because cryptocurrency in and of itself started to lose some of its glamour.

Technology is by no means stagnant: I love the ongoing advances in 3D web rendering, but not because I think the next Facebook is going to be cuboidal, I just think it's neat. But I think we're well past the point where a simple technical spec change is going to radically alter the face of society. In my opinion, what comes next will have as much impact as the introduction of wearables did: VR and AR will open up some neat new opportunities, but the big transitions were from "no computers" to "computers", from "unlinked computers" to "linked computers", and from "big computers" to "pocket computers". If there's going to be a final transition, it will be somewhere in the direction of Bret Victor's excellent Dynamicland: not just Internet of Things-style smarthomes, but environments where computational processing lurks beneath more analog interfaces. (To pick a more consumer-friendly example, I think about something like the iPad, which in its base form is just a big screen but can be attached to a keyboard and trackpad to become a laptop or to a stylus to become a drawing pad—and which can serve as a TV remote or a base of operations for handless headphone-based computing.)

But tech folks are still largely in denial of the fact that what comes next isn't an advance in technology, it's a maturation of our understanding of how technology fits into our life and our societies. We've all gotten caught up in the tech equivalent of binge drinking, and are at the phase where we're feeling that mixture of nausea and pounding headaches and the despairing sense that our lives are no longer entirely in control. We've learned a lot about the experiential language that defines using computers: the rhythms of when they interrupt our lives vs. when we actively seek them out, what information they let us consume and at what speeds, what the tradeoffs are between paying for things and accepting the consequences when we don't. We are oversaturated. And there just isn't room for that much more: what we have will continue to evolve, the way Vine bled into modern Instagram bled into TikTok, but they already own every second of our days. We just don't have anything more that we can offer. And there's increasingly a focus on how to use technology more responsibly, how to take more responsibility for what we take in and what we give up in return, how to really find a happy medium in this space.

The new Internet bubble is popping a lot more slowly than the old one was, but it's popping. I think one sign of that is how there is increasingly a marketplace for things which offer the same old pleasures, but in measured ways: Substacks instead of newsfeeds, the strangely-popular world of well-written news digests like Morning Brew (or the evolution from Politico-esque sites to Axios-esque ones), anti-notification services like the HEY email client, or the ongoing quietening of group chat applications—the last of which is starting to see a drastic uptick. But Silicon Valley doesn't talk about most of these, because very few of them follow the same old "disruptive" patterns that promise billions and billions of dollars' worth of monopolistic value. They look a lot more like small businesses: lucrative, sure, but not out to corner any one market. There will still be huge media-franchise success stories (see Among Us, again), but those are cultural rather than technological powerhouses.

If you want to see tremors of the shift, you can look at YCombinator's batch of current start-up ambitions: 10-15 years ago, it was launching things like Airbnb and Dropbox and Stripe and Twitch and Instacart and Reddit, whereas now, the overwhelming trend is towards SaaS and B2B applications—specialized services, usually aimed at businesses, with a smattering of physical-tech development thrown in. In other words, businesses that look like... businesses.

The revolution's over. Sanity is setting in. The people leaping into "web 3.0" are a combination of tech-culture-savvy grifters, VCs who haven't figured out their time is through, hustler-mindset idiots who think they can still become those VCs, and notoriously in-the-loop celebrities like Matt Damon. There are two or three utopians in the mix, sure, and hopefully they'll come up with nifty things that help people here and there, but to think that web 3.0 could possibly be as big as web 2.0, you need to fundamentally misrepresent and misunderstand why web 2.0 was what it was. The answer's a lot simpler than people right now are making it seem. But they have to make it seem more complicated than it was, because otherwise you'd look at web 3.0, go "this is horseshit," and go back to reading Simpsons guru George Meyer's excellent site Frogs & Turtles, hands-down the best new web product to come out of late 2020/early 2021. And boy does it look it!

*...does a quick search*

brb, making a new FPP
posted by rorgy at 2:28 PM on January 12 [82 favorites]


And I mean exactly why, as it's literally just the same securities scams people ran in the 20s but blockchain.

Or the "wildcat banks" of the mid-19th Century US free banking era, and the tremendous instability of the banknotes of even the legitimate ones.
posted by snuffleupagus at 2:33 PM on January 12 [6 favorites]


someone who wants to really research projects, read code and think deeply about it can find gems that are truly brilliantly done and invest in them.

Hyperlinks or it's not real.

No really, I've kept aware of new stuff. Thinking about making an ISPF node but have not gotten around to it. But other than the idealism of Etherium and ISPF, what are examples of good projets?

Etherium at 100 ft sounds like a great idea, instead of lawyers, create a secure contract that is honest and equitable but in *code* rather than arcane legalize. Er, thousand feet, really now wtf, translating commercial legal contracts into code, what a scary mind numbing horror. But it is a noble idea.
posted by sammyo at 2:35 PM on January 12 [4 favorites]


For those looking for a non-AWS service that allows your to run a server (albeit within some limits) sdf.org might provide you with some of what you are looking for.

As far as the weirdness of blockchain based currencies and pseudoURL-ownership (because as the article clearly demonstrates NFT's gives you ownership of nothing else) go there has never been a viable use case that I have come across. But this is what happens when ignorance plus a little knowledge run with a lot of confidence, aka Engineer's Disease. Apparently the non-engineers who have it are Joe Rogan fans.
posted by Ignorantsavage at 2:40 PM on January 12 [2 favorites]


Or the "wildcat banks" of the mid-19th Century US free banking era, and the tremendous instability of the banknotes of even the legitimate ones.

JFC. Imagine retail workers trying to haggle with indignant shoppers about the parity value of whatever shitty cryptocurrency they're trying to use.
posted by Your Childhood Pet Rock at 2:43 PM on January 12 [8 favorites]


Etherium at 100 ft sounds like a great idea, instead of lawyers, create a secure contract that is honest and equitable but in *code* rather than arcane legalize. Er, thousand feet, really now wtf, translating commercial legal contracts into code, what a scary mind numbing horror. But it is a noble idea.

"I didn't think it'd be this hard" is pretty much the Libertarian creed at this point.
posted by Your Childhood Pet Rock at 2:46 PM on January 12 [23 favorites]


I've said this elsewhere, but: does anyone seriously believe that you'll be able to trade in your Reddit Blockchain Points in for Discord Blockchain points, or buy anything real from anyone but the company that issued the points?

This is the opposite of decentralization. It's wildcat banks issuing company scrip with extra steps.
posted by mhoye at 2:51 PM on January 12 [13 favorites]


Imagine retail workers trying to haggle with indignant shoppers about the parity value of whatever shitty cryptocurrency they're trying to use.

"We take US dollars."
"But I have crypto X! Dollars aren't really valuable!"
"We might take Euros, let me check the exchange rate."
"Why do you want to miss out on the future?"
"I am sorry, we choose not to repeat the well-documented mistakes of the nineteenth and early twentieth centuries. And until cryptobro is a Federally protected class I am going to ask you to leave these premises and never return. Thank you for your interest and have great day."
posted by Ignorantsavage at 2:52 PM on January 12 [6 favorites]


There are lots of folks running their own servers. Lots of independent cloud providers, hundreds other than AWS or google. I have a handy little VM slice for $24/yr. Look at NearlyFree if you need solid privacy for ethical purposes, bunch folks here use them.
posted by sammyo at 2:53 PM on January 12 [4 favorites]


I've said this elsewhere, but: does anyone seriously believe that you'll be able to trade in your Reddit Blockchain Points in for Discord Blockchain points, or buy anything real from anyone but the company that issued the points?

I don't know what you're talking about. My 79,307 HEI points are going to vest any day now.

#dexit
posted by rorgy at 2:54 PM on January 12


first comment on that HEI points vid ...

Paying my child support exclusively in HEI points from now on, my children will thank me later when those points trickle up

posted by philip-random at 2:58 PM on January 12 [2 favorites]


I read Marlinspike's post last night and have been mulling over my thoughts in response to it since then.

First, I think he deserves props in general. It is one of the most damning-with-faint-praise takedowns of "web3" that I've read in a while. And it's not like he just came out and said "yo, your shit sucks! it's bad any you should feel bad!" (even though I think that is basically justified). No, he actually made an attempt to build something with the technology that's been made available and is supposedly so game-changing.

And then he basically said "your shit sucks".

For people who respect Marlinspike a lot—and I consider myself in that camp; I don't know the guy personally or anything, but I've corresponded with him and have basically followed his career trajectory since we were both on the same Mac DVD decryption/ripping forums in the early 2000s—this basically settles any remaining FOMO or self-doubting "am I just missing something here?"-type questions. No, I am not missing anything. Someone clearly smarter and more knowledgable than me, someone whose opinion I basically trust, has now looked hard at the web3/crypto shit, and found it wanting. It's nice to have one's assessment confirmed.

Really, the only issue I take with his post is the repeated insistence that "people don't want to run servers". This is not some sort of iron law of the universe. People run all sorts of "servers" without thinking much about it, typically in the form of networked devices that expose a capability to client systems. My new Samsung TV? It's a server: it sits there on the wall, hooked up to my network, listening for someone to connect to it and use its capabilities (displaying crap on a screen, playing audio). It is absolutely a server by any reasonable definition. My edge router, the thing that sits between my computers and my cable modem (and is largely responsible for breaking the whole peer-to-peer architecture of the early Internet with NAT), that's definitely a server too. You don't run IP Masquerade on the client side. Routing, DHCP, NAT... these are all inherently server-side capabilities, and most people have them running in their house right now.

What I think Moxie is getting at, is that people don't want to have a 3U rackmount in their basement, running LAMP or Docker or whatever the new bloated containerization stuff is this week. Okay, sure. The number of people who want a datacenter-surplus rackmount server in their basement is probably not huge (although, it's bigger than you'd think), and probably are already squared away on server hardware. But that doesn't have to be what a server is.

A couple of thoughts:
  • Consumer networking hardware is god-fucking-awful. However, the amount of computing power and connectivity that's being pushed out to the network edges in this form is considerable. (That's why criminals are making botnets out of them.) This is the obvious place in a typical home network to hang a server, since it has a public-facing IP address and is probably always turned on. I think the market is probably ripe for someone to come in and really give Netgear, Linksys, TP-Link, etc. a hard beating. I'm envisioning some sort of network edge appliance that does NAT and produces a WiFi network and all the usual stuff, but also provides an easy way of deploying "apps". If Apple came out with a new version of the Airport, they could probably own this space. Google could do it too with their Home products. There's no reason that installing a new "server app" should be any harder than installing a phone app.
  • Unless you solve the "server problem", you don't really have decentralization. As Moxie correctly points out, hosted services have a tendency to consolidate, mostly due to economies of scale. If you're running an email server for 100 users, it's not twice as much work to run one for 200 users. And it's not ten times as much work to run one for 1,000. This is why there are like half a dozen major email providers today, and they mostly only do email as a sort of loss-leader service anyway. It's very hard for boutique services to compete on cost, or for DIY to compete on time investment.
  • The days of the "free lunch" are ending. Setting aside the questionable sustainability of advertising as the core business model of the centralized Internet, the "unlimited storage" deals that providers have been using to lure customers since Gmail first opened its first beta are probably ending soon. The cost of storage hasn't been falling with the same regularity that it was for many years, and it was that constantly-falling cost of storage, plus assumptions about endless growth, that allowed those deals to happen at all. Users are now being asked to pay for storage, and it's not cheap. As any number of AskMe questions will attest to, nobody has a great solution to "what do I do when I run out of free iCloud space?" except "suck it up and pay Apple every month". Eventually, as people's storage needs grow (those new cameras produce a lot of data, and so do rich messaging systems like iMessage), there is going to be a demand for cheaper, network-exposed storage. You are unlikely to get cloud-based storage that is cheaper than what you can get in your own house (it's not like the cloud providers buy hard drives that are any different from what you and I buy, and they also have to pay for electricity and connectivity).
  • Concerns about data ownership are growing. Some software developers like to blithely assume that users are too stupid to care where their data actually resides, or who has access to it. That might have been true 10 years ago, but I think it's changing. A lot of people—younger "digital natives" and "wireless natives" in particular—have Strong Opinions about who they want to have access to their data. (I credit sexting and naked selfies.)
  • Data centers are huge points of failure. Whenever the AWS datacenter in Ashburn VA shits the bed, it's like half the Internet stops working. This is not great. Also, data transit into and out of datacenters isn't free. Wouldn't it be better if you could push both the reliability question and the cost of data transfer onto the end user? Why are you paying for stuff like user-to-user VOIP calls to go through your datacenter, when you could just have the call traffic route from one user directly to the other? (In the pre-Microsoft days, Skype realized this and did something about it. But then Microsoft messed it up, as Microsoft is wont to do, because they only cared about the branding and not the technology.)

Within the next few years, I think we'll see one of the heavyweights (Apple, Google, Microsoft, maybe Amazon, maybe even Comcast/ATT/Cox) make some sort of consumer-oriented edge router that includes an easy way to attach cheap storage and rapidly deploy apps to it. Once you have this hardware—particularly if you control the hardware—there's a lot of shit you can do with it.

You can use it for data storage of stuff that's expensive to keep in the public cloud, obviously. You can use it for backups. You can use it to run distributed filesystems and blockchains (although I don't think there's a lot of actual problems solved by "blockchain" in their current forms, there are certainly neat things you can do with distributed, cryptographically-secured databases). You can also do slightly-sneaky shit: you could push content out to the consumer's device and use it as a web accelerator. (You think CloudFlare is fast? Wait until you already have the content pushed down to your LAN.) If you have the right info, you can even do predictive analytics and push data to a customer's network before they request it. You can make these nodes act like their own CDN for bandwidth-intensive applications like Netflix. (Why are you pulling Pretty Little Liars from the Netflix datacenter, if your neighbor just watched it? Get it from them.) And of course, if you own a customer's edge router, you have a ton of insight into their browsing / content-consumption habits.

So anyway, I think the idea that servers or server-like applications can't live at the network edge is just false. Not only is it false, it's definitely going to happen in the pretty near future. So, it's entirely possible that a user could run a local blockchain instance. I don't think they will, because I think blockchains are literally a solution looking for a problem (that isn't "do crimes"), but there are lots of distributed-ish applications that can be run at the edge.

It would be nice if, as a user community, we got ahead of the tech heavyweights this time around.
posted by Kadin2048 at 2:59 PM on January 12 [23 favorites]


This is a great discussion. I'm almost embarrassed to throw out my utterly basic rough conception of crypto at this point. With that said, I'm grouping it into three levels: (1) basic bitcoin, maybe a little eth or more (2) NFTs, (3) everything else. And the bullshit factor is basically 5 nines for bitcoin and then infinite for the other two.

So, for this whole "oppressed minorities crawling under barbed wire with their money stored in a memorized digital key in their mind" scenario, that entirely lives in circle 1, right? There's not even the shred of that scenario living outside of that right? Which is sort of correlated with my 99.999999% bullshit, 100%, 100% bullshit breakdown.

As for the "now brilliant little guys can invest in great ideas" scenario, that just seems like transparent "get rich quick" bullshit. I feel there's some deep connection to the fractionalization craze which has turned into: rich people invest in wine, why shouldn't you? And, well, it's just all fucking gambling. In what conceivable world does a person with pro-social tendencies thing to themselves: my way of improving the world is I'm going to help open the investing in wine market to more people. Will they ever publish the basic numbers that would say what their customers make? Why, if this was really a good idea, wouldn't they just get rich doing it themselves? Basically all esoteric investment schemes are scams.
posted by Wood at 3:29 PM on January 12 [1 favorite]


Kadin2048, maybe I need a slightly different word of "run". "Run_2;", as the linguists do? Lots of people plug in and turn on servers that then run_1 silently, hence the evil botnets. It's hard to run_2 the IoT well enough to plug the vulnerabilities. And I see that you wind up your para on edge servers with the corporations running them and using what they know. That's Web2.0 coming from inside the house, yeah?

I have verrrrrrry little faith in people's ability to manage anything distributed and secure, what with the only widely accepted answer to "don't write your password on a postit!" being... networked password safes. We tried with PGP! And some other things! Retina and fingerprint scanners, but then we lose pseudonymity.
posted by clew at 3:41 PM on January 12 [1 favorite]


There was a recent DAO (Decentralized Autonomous Organization), which is some part of the web3 concept, which failed miserably and in surprising ways:

Chaos engulfs crypto investors who failed to buy copy of Constitution
From a meme to $47 million: ConstitutionDAO, crypto, and the future of crowdfunding

1. There was a DAO created in order to raise funds to buy one of the original copies of the US Constitution, and if purchased, decide what to do with it
2. The DAO failed to buy the document
3. Donators who tried to get back their unspent money lost significant amounts of their donations in transaction fees (aka gas fees)
4. The project owners unilaterally decided to dissolve the original governance tokens and transfer them to another token, the purpose of which is unclear
5. People angry
6. The project owners pretend that they never did step 4 and refunded everyone's money including the gas fees

Step 6 is optional.
posted by meowzilla at 3:43 PM on January 12 [3 favorites]


There was a DAO created in order to raise funds to buy one of the original copies of the US Constitution, and if purchased, decide what to do with it
This is the part that corresponds to "really research projects, read code and think deeply about it can find gems that are truly brilliantly done and invest in them"
posted by Wood at 3:46 PM on January 12


Moscow Maserati

Yeah he wrote TFA

dammit in too late with this very good joke
posted by supercres at 4:05 PM on January 12 [5 favorites]


There is (so far as I've seen) one additional functional, if not particularly practical, use for NFTs: exclusive account access. It is not a _good_ use case, but it is one that I haven't seen discussed here.

Consider this: You can buy a Metafilter NFT for $5, and metafilter will "mint" them indefinitely, as long as people are buying new ones. Only owners of Metafilter NFTs can log in and post to Metafilter. So, if you want to log in and post, you pay Metafilter, LLC $5, they send you an NFT for your wallet, and from that point forward, your wallet identifies you as the owner of that NFT when the metafilter servers ask to identify/authorize you.

Some time later, you decide that you don't want your account anymore. One way to do that is to destroy the NFT (or lose your key to it, or whatever). Another way to do it is to sell that NFT to someone and transfer the NFT to their wallet. This transfer of ownership happens outside of Metafilter, but the next time that the Metafilter servers ask you to present proof of your ownership of your NFT, you can't, because the immutable ledger shows that it has been transferred to a new wallet, and only the owner of THAT wallet can show ownership of the NFT.

Now, imagine that there were only 10,000 Metafilter NFTs in existence, and no new ones would be minted (or maybe only 100 new ones each year in July, or some other artificial scarcity). Perhaps someone who really wanted access in December would offer to pay $100 for one, because they're rich and really want access. If you're holding one that you paid $5 for, and you're not using your account, perhaps you'd sell it to them.

Of course, we already have all of this in (a nice, well run, centralized) place, with $5 signups, and username/passwords and the delete my account button. Moving that kind of "I am a member" signifier to an NFT is kind of silly.

There are already discords that work this way, including at least one where the NFTs are _very_ expensive. Personally, I think this kind of exclusive access is antithetical to the Internet's intent, but I'm an old grey ponytail who built it with an "Information wants to be free" ethos. There are people who want their discord to work like a Yacht Club, where there are a certain number of memberships which will only be held by the wealthy, and people are able to sell them to the highest bidder when they sell their boat/slip and exit the club. Many of these people are (or want to be) VCs who already have memberships to yacht clubs, country clubs, city clubs, and the like, and they're more comfortable with this model than I am.

There is absolutely no reason why any of this exclusive access needs to happen on the blockchain, though. A private site that charges $5 to register (or $5000, or whatever the market will bear) is not fundamentally different than one that requires ownership of an NFT, except that the membership roster is held by the club, instead of living on thousands of computer which collectively burn more dead dinosaurs per second than the country of Argentina.

Well, maybe there is one reason: rich people who want exclusive access to _anything_ are pretty good marks for grifters.
posted by toxic at 4:38 PM on January 12 [1 favorite]


What bothers me about the NFT bullshit (apart from the obscene power consumption) is that it can only work outside the circlejerk of greater-fool grifters and money launderers if the entire web is re-oriented around their model of digital scarcity

and

I think that is the deal with NFTs. These projects are trying create this idea of a resource having different levels of reality

and

It's 100% enclosure of the commons

Yup. Turning something into property that wasn't previously or creating ownership relations that didn't previously exist. Anyone who considers themselves anti-capitalist should completely dismiss NFTs, yet I know some young-ish guys... you all know the story from here.
posted by eviemath at 5:02 PM on January 12 [6 favorites]


In the past few months, Belarusian activists have used bitcoin to defy the regime by sending more than 3 million dollars of unstoppable money directly to striking workers, who then convert it locally to rubles in peer-to-peer marketplaces to feed their families as they protest the country's dictatorship.

In October, a feminist coalition in Nigeria raised the equivalent of tens of thousands of dollars in bitcoin to buy gas masks and protest equipment as activist bank accounts were being turned on and off.

In Russia, the opposition politician Alexei Navalny has raised millions in bitcoin as Vladimir Putin maintains strict control over the traditional financial system. Putin can do a lot of things, but he can't freeze a bitcoin account.

In Iran and Palestine and Cuba, individuals face sanctions or embargoes because of the misdeeds of their corrupt rulers. Bitcoin gives them a lifeline for earning income or receiving remittances from abroad.

Some Venezuelans, having watched their country's currency evaporate due to hyperinflation, are converting their resources to bitcoin's digital format and then escaping. With their savings secured by a password that can be stored on a flash drive, phone, or even memorized, they've started new lives in other countries, taking advantage of a technology that refugees throughout history could only dream about.


One of these things is not like the others
posted by eviemath at 5:09 PM on January 12 [1 favorite]


Really, the only issue I take with his post is the repeated insistence that "people don't want to run servers".

I think this is really much more of "people don't want to administer servers", no?
posted by We had a deal, Kyle at 5:20 PM on January 12 [8 favorites]


I think this is really much more of "people don't want to administer servers", no?

This. Also, I *really really* don't want to administer the servers of my elderly parents.
posted by Slothrup at 5:35 PM on January 12 [9 favorites]


And I see that you wind up your para on edge servers with the corporations running them and using what they know. That's Web2.0 coming from inside the house, yeah?

Well, I think the most likely outcome is that Big Tech will end up "owning" edge infrastructure. Those companies (Google, Apple, Amazon, in particular) already have IoT product portfolios, including the backend management infrastructure, authentication systems, etc., plus they already have their apps on a lot of people's phones, lowering friction.

The major broadband providers (Comcast, etc.) could also probably do it—an increasing number of people seem to just use ISP-supplied router/WAPs rather than buying their own, and they have the deep pockets and financial structure to eat an upfront cost and then make it back slowly later. They are also in an interesting position, because they own the backhaul, which lets them do stuff like out-of-band management, QoS / traffic shaping, or zero-rating data flowing to the edge cache (which they currently do for their private-label WiFi setups, i.e. those "Xfinity Wifi" networks that are all over Comcastland now).

I do not like this outcome. I kinda think it sucks, actually. The fact that I think it's the most likely to occur doesn't mean that I find it preferable. I'd much rather have an Internet that's user-centric, peer-to-peer, and with individuals owning their own data and paying into the system in a way proportional to their use of it.

But there's not a ton of open-hardware success stories to emulate. The one that comes to mind is not normally thought of as a hardware project: PiHole. They basically punt on the hardware issue by using the Raspberry Pi as their reference platform, which the user acquires locally and then drops the software onto. This is a really nice distribution mechanism, but there just aren't a ton of open, cheap, stable, and capable reference platforms floating around (other than the RPi). Maybe you could cut a deal with one of the consumer router manufacturers to get them to provide one (or just not fuck one of their existing models up so that it's hard to install software to), or maybe you could target something like old cellphones that most people have sitting around.

"people don't want to administer servers", no?

Yeah, and if you go down this road (remote admin), you eventually get into a question of "who're you going to trust?" And how do you prove identity. But these are not questions that are unique to servers, they're general challenges in human-machine interaction. All classes of devices run into them. Ideally, the choice of who you trust for identity verification (Apple? Google? the USPS?) would be both hardware and software independent. But the user can't escape having to make a choice.
posted by Kadin2048 at 5:56 PM on January 12


Yeah, that, and you don't actually "run" the server in your smart TV, and most people don't "run" the server in their wifi/modem. I do, but I actually don't want to, either.
posted by Imperfect at 5:58 PM on January 12 [2 favorites]


instead of lawyers, create a secure contract that is honest and equitable but in *code* rather than arcane legalize. Er, thousand feet, really now wtf, translating commercial legal contracts into code, what a scary mind numbing horror.

Oliver Wendell Holmes said, "the life of the law has not been logic: it has been experience." And that is why even basic common contract law affords contract mechanisms and doctrines, claims, defenses and remedies that smart contracts can't; at least as envisioned, and for so long as their main feature is being self-executing and immutable. Such as unconscionability, or impossibility; and reformation or rescission.

It's not because contract law couldn't be enforced hyper legalistically -- that has been the case in the past. And entirely separate jurisprudential systems were set up to soften the harshness of that kind of legalism; a split that was maintained until relatively recent history (and persists in some ways, like when you can get a jury trial and when you can't).
posted by snuffleupagus at 6:04 PM on January 12 [5 favorites]


@tante on why web3 is horseshit.
posted by axiom at 6:04 PM on January 12 [2 favorites]


Etherium "contracts" are essentially nothing more than stored procedures, and have almost nothing to do with actual contracts.

...but, of course, you can't scam [m/b]illions out of tech-obsessed suckers by simply reinventing stored procedures, so you gotta give 'em a fancier name, maybe something they know is pretty darn complex, but something they think can't possibly be that hard despite centuries of experience and the existence of practitioners with deep ("unfairly" compensated!) expertise...
posted by aramaic at 6:33 PM on January 12 [2 favorites]


Really, the only issue I take with his post is the repeated insistence that "people don't want to run servers". This is not some sort of iron law of the universe. People run all sorts of "servers" without thinking much about it, typically in the form of networked devices that expose a capability to client systems

I have an only mildly different take on it than you do, my caveat being that believe that people want agency over their own information, and software that can act on their behalf when they're not around, that they don't need to micromanage like it's a stubborn toddler they're trying to coax into cleaning their room, and at the moment the cost and cognitive overhead of running your own server is the price of having those things. And I think that's the part that's going to change, and showing near-term signs of changing.
posted by mhoye at 6:40 PM on January 12


Etherium "contracts" are essentially nothing more than stored procedures, and have almost nothing to do with actual contracts.

As the joke goes, the only good thing about smart contracts is that they come with a bug bounty program worth 100% of the contract built right into the design.
posted by mhoye at 6:41 PM on January 12 [9 favorites]



There are already discords that work this way, including at least one where the NFTs are _very_ expensive. Personally, I think this kind of exclusive access is antithetical to the Internet's intent, but I'm an old grey ponytail who built it with an "Information wants to be free" ethos.


Thank you for your excellent help with my attempt to understand all this, toxic. I associate "Information wants to be free" with Stewart Brand, and it came to my attention right around the time Richard Dawkins was making his run, so I have always heard a sotto voce 'information wants to replicate' along with that phrase, and from that perspective, making something an NFT is an act of sterilization which admits only a future of aging and death, with no hope of immortality and potential evolution.
posted by jamjam at 6:49 PM on January 12 [2 favorites]


crypto can make it so that large centralized organizations can't tell you that you don't get to access your stored value.

The problem is that there is no such thing as a completely independent store of economic value. Nothing -- no currency, or pseudo-currency, or security, or commodity, or anything at all -- has economic value of its own. Economic value doesn't really reside in the store of value -- it resides in the larger economy it's connected to, in which someone will exchange something else for it.

And any large economy worth being involved in is also going to involve, and inevitably rely on in some way, "large centralized organizations" of some kind.

The fantasy of the independent store of value is what has fired the imaginations of gold bugs for decades, and now it's firing the imaginations of crypto bugs. But it's a fantasy of being both completely connected -- with full economic access -- and completely unencumbered -- with no restrictions whatsoever -- at the same time.

This is a state of contradiction that is generally unsustainable, at least for most people. It has only ever been accessible to certain people: the very rich and powerful, i.e., economic parasites who can take advantage of economic networks that are sustained by less rich and powerful people, while having zero accountability to society at large.

That is the gold bug dream, and that is the crypto dream, and it's both toxic and impossible as a mass phenomenon. You can't have massive numbers of completely unaccountable economic actors. The economy will break down under their inevitable depredations.
posted by Artifice_Eternity at 7:05 PM on January 12 [17 favorites]


The crypto boom has been a long, painful lesson in exactly why those regulations are in place. And I mean exactly why, as it's literally just the same securities scams people ran in the 20s but blockchain.

I mean, NFTs seem like tulip mania all over again.
posted by Artifice_Eternity at 7:09 PM on January 12 [1 favorite]


In fairness, with tulip mania, when you bought a tulip you actually had a tulip. It might die, or lose value, but it was a physical thing that was not going to simply vanish into the ether or that you would lose all access to if you forgot its password. It could even breed more tulips. Cryptocurrencies are just a consensual circle-jerk masquerading as a way, largely, to bring the folks, who are too young to have experienced the dot-com bust, together in loosing their shorts.
posted by Ignorantsavage at 7:18 PM on January 12 [4 favorites]


In fairness, with tulip mania, when you bought a tulip you actually had a tulip.

Not necessarily. Much of the bubble revolved around tulip futures. Contracts were changing hands faster and faster, without anyone actually exchanging tulip bulbs.
posted by Artifice_Eternity at 7:26 PM on January 12 [4 favorites]


A fundamental problem with smart contracts is that they can only make claims and perform actions on other things on the blockchain. Once they intersect with the real world they’re not worth the paper they’re not written on.

The “buy the Constitution” DAO had this problem in a big way. There was a whole structure for those holding tokens in the DAO to vote on what the company should do, but what mechanism ensures that the directors followed the wishes of the token holders? The blockchain gives you no way to do that. There’s nothing except old-fashioned, conventional laws preventing the directors from shrugging and pocketing the money.

Also it turns out nobody wants ownership of anything to be controlled entirely by the blockchain. The steady drumbeat of NFT holders losing their tokens to hackers and then having the exchanges freeze transactions on those tokens proves that strict enforcement of blockchain smart contracts is a bug and not a feature.
posted by chrchr at 7:27 PM on January 12 [5 favorites]


Etherium at 100 ft sounds like a great idea, instead of lawyers, create a secure contract that is honest and equitable but in *code* rather than arcane legalize.

This sounds good to people who know nothing about contracts, or what the actual problems with contracts are.

The blockchain view seems to be that the main problem with contracts is that one party is likely to change the language of the contract, and then different parties' copies of the contract will read differently, leading to disputes.

This basically never happens. Contract disputes are not arguments over what the language of the contract is. They are arguments about what the language of the contract means.

I mean, sure, go ahead, put the whole thing on a blockchain. It's another solution in search of a problem: We already have perfectly reliable ways of recording authoritative copies of contracts.

But agreeing on the text won't stop lawyers from disputing the meaning of every word, and even every punctuation mark, of that text. That is a human problem, as old as the written word, for which there is no purely technical solution.

To be sure, as with so many things blockchain-related, there is already a solution: the legal system. It allows for disputes to be adjudicated according to relatively consistent, but necessarily ever-evolving standards. Again, there is no code that can do that. It requires the analytical and creative abilities of human beings.
posted by Artifice_Eternity at 7:35 PM on January 12 [17 favorites]


There are already discords that work this way, including at least one where the NFTs are _very_ expensive.

Sure, but as you note, there's absolutely no reason why this can't just be handled using a traditional database. You're not gaining anything by using a blockchain. It turns out you end up trusting the same entity in both cases.

That's not a problem with the example; it's a fundamental problem with "blockchain" stuff in general. The only thing they control is the chain itself.

making something an NFT is an act of sterilization which admits only a future of aging and death

There's no such thing as "making something an NFT". An object doesn't "become" an NFT. That's a turn of phrase that grants the whole scheme powers it doesn't actually possess.

Selling an NFT "of" something merely means selling the right to have your name printed next to a URL that currently points to a JPG on a server somewhere. The fact that someone does this, for whatever bizarro-world reasons they do, doesn't affect the original item, or the original file. It doesn't convey ownership in any meaningful way.

The underlying cryptographic techniques behind "blockchains" are sound. IPFS, for example, seems like a generally interesting system. But the quasi-financialized systems like Bitcoin and Ethereum are astronomically overvalued (in the sense of too expensive to use) for the very questionable service (an inefficient distributed database) they actually provide. A centralized ledger operated by the trusted party who already exists (because there's always one, where the blockchain meets the real world) is better in every circumstance.

But as cons go... it's a pretty good one. There's no single responsible party. A fairly large segment of the IT industry has decided to just collectively wink-and-nod and pretend like this is a topic worthy of deep and intense study (and funding! much funding!) and are just riding the wave of crazed, ignorant money.

On one hand, bravo to them—I don't know what those thousands of developers who claim to be working on Ethereum actually do all day, but I hope it brings them great joy. I'm not a player-hater.

On the other hand, fuck you guys for making the input to your scheme retail investors. It's one thing to be taking dumb VC cash or separating PE from some of that E, but this crypto shit is bringing it down to Main Street. That's dirty pool, and it's going to end badly.
posted by Kadin2048 at 7:44 PM on January 12 [8 favorites]


There's no such thing as "making something an NFT". An object doesn't "become" an NFT. That's a turn of phrase that grants the whole scheme powers it doesn't actually possess.

Really?
How to Make an NFT
Pick your item.
Choose your blockchain.
Set up your digital wallet.
Select your NFT marketplace.
Upload your file.
Set up the sales process.
Making NFTs can be a profitable investment.
Dec 8, 2021
Perhaps you should drop The Motley Fool a note. I'm sure they'd appreciate the opportunity to correct such an elementary error.
posted by jamjam at 8:07 PM on January 12


Much of the bubble revolved around tulip futures. Contracts were changing hands faster and faster, without anyone actually exchanging tulip bulbs.

This is the thing about commodities vs their futures. The futures are nothing more than betting slips. And I have no doubt the derivatives that grow around cryptocurrencies will turn out even more nuts than a normal commodity's bubble.
posted by Ignorantsavage at 8:09 PM on January 12 [2 favorites]


"Civilization is a stream with banks. The stream is sometimes filled with blood from people killing, stealing, shouting and doing the things historians usually record, while on the banks, unnoticed, people build homes, make love, raise children, sing songs, write poetry and even whittle statues. The story of civilization is the story of what happened on the banks. Historians are pessimists because they ignore the banks for the river.”

-Will Durant
posted by clavdivs at 8:14 PM on January 12 [8 favorites]


Really?

Really.
Here's a little exercise for you: at which step of the 8 you've listed do you "make [the item] an NFT"?

What you have described is a process for creating an NFT which expresses a claim on the item. That claim has no effect on the item whatsoever, nor on any other (copyright, for example) claims on the item. This distinction is rather important.

That's not to say there isn't an application for creating claims on digital items; one (weak, I believe, but still) argument I've seen for NFTs is that they allow for a secondary market in digital goods which preserves provenance (of a sort — of course, nobody can stop you minting an NFT on something you have no legitimate claim on) wherein the creator of the NFT (who is, ideally, the owner or creator of the original artifact but again...) could be reimbursed every time the good changed hands within the system (emphasis added to avoid the obvious objections about piracy). There's a further argument that such a legitimate secondary market could increase the inherent value of digital goods, which currently can typically not be resold at all. I think that's mostly bunk, not least precisely because the goods can still be traded on outside the market but also because it's a fabulously complex way to implement something you could get with a simple centralized ledger. But it's not utterly without merit.
posted by multics at 8:22 PM on January 12 [5 favorites]


oh, and:

Pick your item.

The preferred way to do this appears to be to nip over to deviantart and find something nobody else has stolen yet. This, like all the other steps, can be easily automated. I'm pretty sure that's what web 3.0 really is: robots selling smart contracts about stolen pictures of space unicorns to day traders.
posted by multics at 8:36 PM on January 12 [10 favorites]


> secondary market in digital goods

The "digital goods market" use case doesn't really make sense either, though: all you're actually doing is writing some bytes into a (very expensive) distributed database. The games themselves would have to check that database in order to determine what items you "owned" and were allowed to use in the game; it's not the blockchain that's creating scarcity, it's the game. (BTW, you can always look for the vulnerable point in an NFT scam by looking at who is ultimately responsible for enforcing scarcity. The NFT in the best case is just a super roundabout way of making a contract with that entity.)

But back to digital goods in games. Why wouldn't the company that makes and runs the game, also just run the database saying who owns what property? Or more likely: why would they re-engineer their game and make it dependent on an external "public blockchain"... just to tell what items a user possessed? Where's their benefit?

But even if we handwave that away, and assume the game companies just want to make their digital products interoperable... then okay, they could just all agree (as part of the insane amount of coordination something like that would involve) who was going to run the canonical database, or set up a distributed one between themselves just for that purpose. (They could even use a fancy keysplitting algorithm or something, if we are in crypto-fantasyland.) Again, using a public blockchain adds no value, makes nothing easier—except getting credulous investors. Technically, it is a solution looking for a problem.

But again: I'm not necessarily against a few engineers telling some tall tales to separate the ultra-rich from some of their ill-gotten gains. The usual Silicon Valley shit. What offends me about *coins is that it's fleecing the retail investor market.

At least Elizabeth Holmes had the good taste to fleece people who could afford to give up some wool.

Also, The Motley Fool got its start peddling advice that purported to let you "crush mutual funds in 15 minutes a year", during the dot-com boom of the late 90s. It... didn't fare well. This sort of bubble market is exactly their jam.
posted by Kadin2048 at 9:13 PM on January 12 [8 favorites]


Also the author of that Motley Fool "How to Make an NFT" article is described thusly by his author bio:
Matthew is a senior energy and materials specialist with The Motley Fool. He graduated from Liberty University with a degree in Biblical Studies and a Masters of Business Administration. You can follow him on Twitter for the latest news and analysis of the energy and materials industries:
This does not sound like the resume of someone I want to trust on this particular topic, NFTs being outside of both energy and materials industries. Particularly when the article includes statements like "An NFT is a unique digital item with a sole owner" (citation needed -- many NFT "owners" can be found being roundly mocked when their bad ape drawing ends up all over twitter and they cry about it, also see @CoinersTakingLs) and ends with a disclaimer that "The Motley Fool owns shares of and recommends Ethereum."
posted by axiom at 9:55 PM on January 12 [11 favorites]



Finally: what is the presumed benefit of such a scheme?
[...]
it just seemed to be an exercise in artificially created scarcity ... ... for reasons.

I guess I'm still trying to get a handle on a good reason.

You have a handle on it, it's for artificial scarcity. Full stop. That's the whole reason. Being a middleman in a system of artificial scarcity is fantastic in terms of profit potential. That's it.

Cryptography is amazing, and the original stuff that kicked off the use of the term "web 3", that is bittorrent style p2p swarms altered to be more general purpose are also really promising. Right now you either publish something unpopular, lose control of the rights to it, or go bankrupt paying for the bandwidth costs of popularity. So IPFS and Dat/Hypercore and the rest of this new tech are needed. The more people listening/downloading/watching your stuff the more upload bandwidth is available. It's already very heavily used for a lot of stuff that's more niche than the goal of "replace the web" and works great, it's already successful, it's already a massive improvement.

But there is even less scarcity in these systems than is in the current web/app store ecosystem. And there are two camps now, you either think this is a great thing or that artificial scarcity needs to be added back in. That former camp is mostly open source people and academics and some left-wing tech people. The latter camp is huge, big enough to just appropriate the terms "crypto" and "web3", the profit in creating artificial scarcity is huge, and the removal of more scarcity would change a lot of things (anyone who makes money from "IP" that can be digitized is threatened).

The rest is chaff.
posted by Infracanophile at 10:21 PM on January 12 [1 favorite]


compete on time investment.
The days of the "free lunch" are ending. Setting aside the questionable sustainability of advertising as the core business model of the centralized Internet, the "unlimited storage" deals that providers have been using to lure customers since Gmail first opened its first beta are probably ending soon. The cost of storage hasn't been falling with the same regularity that it was for many years,


Ironically, this is at least exacerbated if not partially caused by, yet another shitcoin.
posted by Dysk at 12:39 AM on January 13 [3 favorites]


NFTs being outside of both energy and materials industries

but the energy and materials curriculum is so strong in Biblical Studies and MBA programs! the guy is probably well-qualified
posted by thelonius at 4:30 AM on January 13 [3 favorites]


The Motley Fool's role in the marketplace is to convince the ducks to buy what the swans have to sell. Their relentless plugging of crypto/NFT is a sign that the finbros have moved into the space en masse and that while the pyramid has yet to collapse there is no longer any "ground floor" to get in on. And so the great retail reaping begins.
posted by seanmpuckett at 5:13 AM on January 13


t people want agency over their own information, and software that can act on their behalf when they're not around, that they don't need to micromanage like it's a stubborn toddler they're trying to coax into cleaning their room

I feel like this has been a fundamental problem with cryptocurrency from the beginning. Anyone remember way back when MTGOX lost a million zillion bitcoins? Isn't this exactly the sort of nonsense the boosters of cryptocurrency told us could never, ever, happen, because you alone have the control of your coins and no other entity can just take them away from you without you signing them away?

Well, it turns out that most people would rather turn over the keys to their stuff to someone else than manage that shit themselves. This happens in the real world too. You toss your car keys to the valet and you assume that they go park it instead of stealing it, which in a society with laws is usually a pretty good bet. It happens with a lot of other credentials too: take LastPass and similar password managers. For what it's worth, really security-conscious folks have looked at traffic from computers running LastPass to LastPass's servers and been satisfied that passwords are not out there in plaintext and that LastPass can't really access your stuff, and that the local storage option can keep them from just losing your passwords. Less security-conscious people (like me) hear what those people are saying and predicate their trust on that expertise. But most people aren't in either of those categories: they hear "this thing will keep you from having to memorize your passwords" and roll with it. They don't vet the system's standards, they don't keep a local copy, because there's other stuff they want to be doing with their brains and they straight-up can't or won't spare the cognitive load to think about it any deeper. It's hard to really fault them for this: we already have a lot to keep track of in this life, and we can't all be experts on every single thing we interface with, and somewhere along the line you end up trusting someone else to do the job right on all the things you don't feel up to doing yourself. Apply this same principle to cryptocurrencies, and suddenly this "you own it, and nobody else can touch it without your consent" asset is in ordinary bank-like structures, except that these bank-like structures aren't obligated to obey financial law. And most everybody is like this to some extent, and that's why any sort of distributed system will never much help individuals, because people don't want to set up their own interface with a distributed system, they want someone to handle that for them, and then the centralization starts.
posted by jackbishop at 5:53 AM on January 13 [7 favorites]


Anyone remember way back when MTGOX lost a million zillion bitcoins?

Who could have predicted that Magic The Gathering Online Exchange wasn't a secure place to store your investments.
posted by mhoye at 5:58 AM on January 13 [10 favorites]


But back to digital goods in games. Why wouldn't the company that makes and runs the game, also just run the database saying who owns what property?

I think the argument, such as it is, is less about assets within an already-centralized ecosystem such as games (even though operators of such ecosystems are hopping on the hypetrain) as for things like the content hosted on, say, deviantart or bandcamp, and the scarce property is not the object itself, but its provenance. That's hardly new in art, and in fact digital (and other ephemeral) artworks are traded today in a manner which preserves provenance. I think the web3 argument, such as it is, is that it democratizes the process of trading in these goods so that your average space unicorn creator can participate without involving Christie's or even deviantart (who, beyond their problematic roles as gatekeepers, might someday cease to exist). Sure, people could still pass the art around without the NFT changing hands, but the value would remain with the registered owner(s), who can show a chain of custody back to the original NFT issuer. Moreover, as I said, the ecosystem could allow for the creator to receive a chunk of any later sales; that's something that's vanishingly rare in current markets and does contribute to the difficulty of sustaining the arts.

Again, I think that argument's a total snow job — you don't need Sotheby's or an NFT to write a bill-of-sale and you certainly don't need to melt the ice caps to do so. And the whole thing simply handwaves away the problems of preservation of, and rights in, the asset itself. As usual, the cryptobros have (re-)solved the easiest part of the problem in the hardest possible way and hidden all the truly hard problems behind a blizzard of buzzwords and money. But there's a kernel of value in the shit being flung about.
posted by multics at 7:46 AM on January 13 [1 favorite]


Ironically, this is at least exacerbated if not partially caused by, yet another shitcoin.

oh bram cohen no
posted by Kadin2048 at 7:48 AM on January 13 [2 favorites]


Right now you either publish something unpopular, lose control of the rights to it, or go bankrupt paying for the bandwidth costs of popularity.

I get this. The bandwidth problem. Say you're a DJ. You post a mix, hosted on your own server. The more people listen to it, the more bandwidth you use, the more it costs you. Popularity is murder (financially). So you're only option is to post it elsewhere, sign your rights away to Youtube or Mixcloud or whatever ...

So IPFS and Dat/Hypercore and the rest of this new tech are needed. The more people listening/downloading/watching your stuff the more upload bandwidth is available. It's already very heavily used for a lot of stuff that's more niche than the goal of "replace the web" and works great, it's already successful, it's already a massive improvement.

Are you saying that some of the Web 3.0 tech solves the bandwidth issue?

could you elaborate on this?
posted by philip-random at 8:14 AM on January 13


Are you saying that some of the Web 3.0 tech solves the bandwidth issue?

"Web 3.0" doesn't, because Web 3.0 isn't a thing that exists. It's a sort of mushy marketing buzzword used to gloss over a whole bunch of technologies, some of which have technical merit (IPFS, Distributed Hash Tables, etc.), and some which don't (*coins, NFTs, and other get-rich-quick schemes).

IPFS, in particular, shows some promise as a way of hosting files via a P2P architecture, in such a way that they are reproduced throughout the network in proportion to their popularity. In theory, it allows for some of the edge-caching use cases I mentioned in one of my earlier comments: rather than constantly pulling the same content from a central server or CDN, if you want to watch a video that your neighbor watched yesterday, you can pull those bits from your neighbor's IPFS cache.

Note that this doesn't use "blockchain" at all, and the underlying technology has been around for a while. It's conceptually very close to Freenet, which was developed in the late 90s.

TBH, I think you can look at IPFS as basically a nicer implementation of Freenet (which was, as befits the time when it was developed, a big honking Java application). IIRC, Freenet didn't provide a really easy-to-use method of accessing content; you had to use its APIs and basically write your software around Freenet. IPFS seems to integrate better into existing stuff, in part because it provides a nice HTTP access mechanism.

That said, I don't know how they plan to get around the child porn problem. When I briefly set up and ran a Freenet node in the early 00s, it seemed like that was what it was mostly being used for, and I was uncomfortable running a node and hosting chunks of encrypted content, knowing that most of that content was probably CSAM.
posted by Kadin2048 at 8:58 AM on January 13 [4 favorites]


The more people listen to it, the more bandwidth you use, the more it costs you. Popularity is murder (financially)

This doesn't ever seem to have been an issue for any but the most naive, so I'm not sure if that's impactful or telling...

Are you saying that some of the Web 3.0 tech solves the bandwidth issue?
AIS and cloud solved bandwidth issues. I mean, you can literally input in how much you can pay monthly or whatever.
posted by The_Vegetables at 9:07 AM on January 13


Yeah, ownership is a completely orthogonal question to the questions of access, distribution, and preservation, and it's disingenuous to suggest that NFTs are in any way a solution to the question of how to ensure the survival of a digital resource. At best you could argue that selling NFTs could monetize a product in such a way as to enable its distribution and preservation by the original artist, but that's only a solution to the extent that throwing money at problems is a way of solving them and thus literally any way of making money is a way of solving problems. The distributed ownership schemes emphatically do not distribute responsibility for preservation and access --- the NFT is just a URL, and maintenance of the content of that URL depends on whoever owns that hostname. Indeed, not only does the NFT holder not have any responsibility to preserve the resource, they probably don't even have the right to do so: under the current laws almost everywhere which accord no content-management rights to owners of NFTs, the "owner" of an NFT has no legal right whatsoever to redistribute the content except as permitted by the copyright holder.
posted by jackbishop at 9:33 AM on January 13 [2 favorites]


> toxic: "There is (so far as I've seen) one additional functional, if not particularly practical, use for NFTs: exclusive account access."

This is an interesting thought experiment but I would like to point out that the main feature that NFT-type technology adds to "exclusive account access" (which alone obviously doesn't need decentralization) is "transferrable exclusive account access"... which kind of makes me wonder what kind of exclusivity is being enforced here. In pretty much every other exclusive membership, whether it's a snooty country club or Raya or pre-2005 Facebook, membership is/was explicitly not intended to be transferrable. In all the examples I can think of off the top of my head, exclusivity is not simply a matter of how many people are allowed in but rather which people are alllowed in and this kind of decentralized transferability (i.e.: outside the oversight of the organization to which access is being granted) kind of works exactly opposite to that.
posted by mhum at 10:04 AM on January 13 [3 favorites]


Moreover, as I said, the ecosystem could allow for the creator to receive a chunk of any later sales

Just want to address this because it's something that comes up a lot, and it's something I just saw Mark Cuban pushing. (I'm going to call "onward sales supporting artists" moral rights for short, even if that's not perfectly accurate.) I'd love to see if there's anything beyond just lies and scams here, but for the moment, here's what I've found:

https://eips.ethereum.org/EIPS/eip-2981
It is believed that the NFT marketplace ecosystem will voluntarily implement this royalty payment standard; in a bid to provide ongoing funding for artists/creators. NFT buyers will assess the royalty payment as a factor when making NFT purchasing decisions.
This is all I can find about the notion of moral rights. As understood, the entire point of crypto,blockchain,NFTs is that "code is law" and decentralization can replace trusted gatekeepers. So, why then is the current state of the art for these moral rights actually based on the honor system and centralized authorities? When these moral rights are constantly being touted as the way that the system "supports artists"? There are many obvious issues with actually "coding up" moral rights in the blockchain including the basic facts that the blockchain doesn't really contain the necessary notions. Just consider how if I gift a painting to a child no moral rights payment is necessary, but if I sell it for a profit a payment is necessary. My understanding is that in societies where this sort of thing exists (e.g. France), the "old fashioned" legal system must handle these cases.

To me, it's simply the socially conscious lie that surrounds the grift. But I honestly struggle to see what's in it for someone like Cuban or Dorsey. I don't think I'm naive about greed or ego, but really?
posted by Wood at 10:07 AM on January 13 [5 favorites]


Remember when Moxie bought a decaying hull of a sailboat, fixed it up with a bunch of friends on the cheap, sailed around the Caribbean with it, made a cool video about it, then returned all the editing gear to keep costs as low as possible?

That sort of stuff was super inspirational to me.

I don't know what any of this other stuff is.
posted by alex_skazat at 10:18 AM on January 13 [2 favorites]


To me, it's simply the socially conscious lie that surrounds the grift.

I think you're absolutely right in that, and even while there's some incentive for the folks shilling NFTs to build in what you're calling "moral rights" as an incentive to attract artists, there's also an incentive to abolish those rights once the artists are locked in (by, for example, creating derivative NFTs which simply point to the original NFT, thus maintaining provenance, but which eliminate the artist's cut of future sales.)

That said, some of the people I've seen (or understood to be; I could be wrong) promoting this model are people like Lars Holdhus — ie, artists; giving the maximum benefit to the argument, you could imagine that artists would create the ecosystem itself and perhaps find ways to reduce incentives to game the system (spoiler: the speculators will game the system anyway. Exploitation finds a way.)
posted by multics at 10:26 AM on January 13 [1 favorite]


AIS and cloud solved bandwidth issues.

Huh? I wouldn't call bandwidth a "solved" problem.

Bandwidth is very cheap right now, in historical terms, but it's not truly zero-cost. Same with storage. Anyone who is letting you host stuff for free on their hardware is either being nice (e.g. Internet Archive), or somehow making money off of you and your content (YouTube), or it's a loss-leader giveaway to sell more premium services (CloudFlare).

The cost of distributing an MP3 album in 2022 is admittedly pretty trivial, though. A cheap VPS costs like $4/mo and comes with 1TB/mo of transfer. So the cost to distribute an 80MB MP3 album without Big Tech is on the order of hundredths of a cent. Not bad! But that's distributing what amounts to 1990s content on 2020s technology. It should be cheap.

But suppose you're some kid in Peoria with an iPhone who just made a really nice 4K movie. Say it's 30GB. Now it only takes 30 requests to blow through your VPS monthly bandwidth cap. If you suddenly go viral and have, say, 1000 views/day, that's 30TB/day, or 900TB/mo. You're not putting that on a $4 VPS anymore. AWS would charge you like $45,000 for that much bandwidth.

The cheapest way to buy bandwidth that I'm aware of is unmetered ports to a server in a datacenter; they run something like $200 per gigabit-month, or 1.6TB/dollar if I'm doing my math right. Not bad, but definitely not free.
posted by Kadin2048 at 10:30 AM on January 13 [5 favorites]




To me, it's simply the socially conscious lie that surrounds the grift. But I honestly struggle to see what's in it for someone like Cuban or Dorsey.

I think they're both pretty clearly in it for the money.

Cuban made his initial fuck-you money by selling Broadcast.com to Yahoo in what has been termed "one of the worst Internet acquisitions of all time". Yahoo paid $5.7B in 1999, right before the dot-com party ended, and Cuban was smart enough to hedge against a decline in the Yahoo shares he was paid with.

Dorsey apparently missed the dot-com gravy train, but built Twitter just in time to get in for the next big upswing in 2005. He's now out of management at Twitter (which finally settled on the "sell ads" business model, for lack of anything better) and running Block, née Square, which is admittedly an actual company that does actual stuff in the actual regulated financial market. (They operate a no-shit FDIC chartered bank.)

Anyway, neither of them are babes in the woods. I'm sure they'll do fine. Jet fuel for those Gulfstreams can't be cheap.

It's the morons individual investors who are paying $10,000 to have their name written in a blockchain next to the URL for a JPEG of a cartoon ape, who are going to be left holding the bag.

It's totally possible to make money during times of market mania: get in early, sell to a bigger sucker, take your money and GTFO. (The /r/wallstreetbets crowd literally has a shorthand term, "bagholding", for hanging onto an irrationally-priced asset too long and riding it back down.) But it's a zero-sum game: you win when others lose, and the only way to not lose is to keep bringing in bigger suckers.

This is one of the reasons why *coin proponents in particular seem to react with such vitriol when the scamminess of the whole ecosystem is pointed out: they are almost always in on the game themselves, and will be left as bagholders if they can't keep bringing in new "investors".
posted by Kadin2048 at 11:26 AM on January 13 [7 favorites]


"It's the morons individual investors who are paying $10,000 to have their name written in a blockchain next to the URL for a JPEG of a cartoon ape, who are going to be left holding the bag."
My friend uses this to soothe my anger. "Dude, you're not buying them, let the idiots get burned." (He's less socially conscious than I am about things and my concern is the fast rate of growth of this grift, and the environmental devastation - he has some of that concern, but I think he doesn't see it really taking off like the proponents want (e.g. it's just a grift and they're gonna get screwed).

I worry it's already too large and while will have ups and downs like any market force, in the end, it's too late. So his hope is just "let the marks be grifted, don't take part and you dont have to worry" (except we see what happens with bubbles like the housing market or stock bubble). IDK.

It's such a goddamned pyramid scheme, and it's insane the way this has taken off when so many others that are just as obvious fail. Is it because neophilic non-technophiles who just want to get rich quick buy in? I mean, hey, you don't even have to buy hundreds of vitamins from a diamond distributor, or all your detergent for a decade.

It's literally doing the whole "digitial distribution is cheap and easy" and turning the physical commodity into bits, and then using the MLM method of scamming so it's even cheaper and easier to run such scams. you don't need a "product" just a jpeg. and a loud marketing voice to try to be the biggest grifter, and you don't have to feel bad because unlike MLM you're not even grifting your friends just a bunch of other marks who you think are dumber than you.

*sigh*
posted by symbioid at 12:06 PM on January 13


Remember when Moxie bought a decaying hull of a sailboat, fixed it up with a bunch of friends on the cheap, sailed around the Caribbean with it, made a cool video about it vimeo , then returned all the editing gear to keep costs as low as possible?

Turns out Moxie != Maciej.
posted by snuffleupagus at 4:55 PM on January 13


Alex Stamos: "The best long play is probably crypto forensics companies and Moscow Maserati dealerships."

He’s being a little shortsighted, IMO. All those high priced NFTs that are just a URL pointing at a jpeg are a world class extortion scheme just waiting to happen and the people who own those servers know it.

That’s an awful nice ape you got there, be a shame if anything happened to it.
posted by mhoye at 5:58 AM on January 14


And the best short-term play is to run a NFT "marketplace". I mean, that's where the sale is actually occurring. The whole blockchain stuff is just set dressing and buzzword bingo.

OpenSea, which is the big NFT market at the moment, apparently charges something like 2.5% in fees. And then they also charge "Account registration fees" and "Contract approval fees".

Also, they appear to be acting as the actual content host for a lot of NFTs, meaning they are well-positioned to charge "maintenance" fees down the road, if you want your NFT to actually point to something other than a 404 Error in the future.

Again and as always, there is no reason for the "blockchain" part of their business to exist, except as a way to get customers in the door. They could much more easily do everything that they're doing via an internal append-only database or ledger, and it would require no additional trust from anyone in the transaction.

Just like with actual gold rushes, most of the money to be made isn't in the gold, it's in selling picks and shovels to the desperate miners.

If I were OpenSea, I'd play along with this whole bogus blockchain stuff for a while, establish dominance in the market, and wait for customers to get annoyed at the (extremely high) "gas" fees charged by Ethereum. Then I'd start to offer an alternative "off chain" service: instead of recording individual transactions onto the expensive and inefficient public blockchain, just record them in an internal database! (If you really want to keep the blockchain farce going, you could promise to write a hash of the internal database state to the public blockchain once in a while, to protect against modification.) Boom, no more "gas" fees—you can absorb those as profit instead! And hey, no more requirement for users to go out and buy Ether "coins" somewhere—they could pay directly with good ol' US dollars. Partner with a US bank and they could do ACH, even. (Don't forget to charge fees, though.) If they were interested in actually providing a meaningful service, they could hire a lawyer to structure some contracts (actual, legal, enforceable-by-people-with-guns contracts, not weird bullshit machine code) so that the copyright or some sort of exclusive license to the underlying artwork would actually transfer to the buyer. Or not, because why bother?

You could even market these as "green" NFTs! All the fun of buying something totally meaningless for speculative purposes, but none of the environmental impact of a blockchain!
posted by Kadin2048 at 9:26 AM on January 14 [2 favorites]


But suppose you're some kid in Peoria with an iPhone who just made a really nice 4K movie. Say it's 30GB. Now it only takes 30 requests to blow through your VPS monthly bandwidth cap. If you suddenly go viral and have, say, 1000 views/day, that's 30TB/day, or 900TB/mo. You're not putting that on a $4 VPS anymore. AWS would charge you like $45,000 for that much bandwidth.

Well it goes more like this: that kid puts shorts up on TikTok, gets more than 1000 (seriously? that's not viral.) views a day, gets a sponsored contract, and his sponsors pay the $45k while it's running hot.
posted by The_Vegetables at 9:35 AM on January 14


dickbuttts
posted by snuffleupagus at 2:12 PM on January 15


NYT: Crypto Enthusiasts Meet Their Match: Angry Gamers - Game publishers are offering NFTs, but skeptical gamers smell a moneymaking scheme and are fighting back.

i am a huge fan of S.T.A.L.K.E.R. and watched this all go down in real time on /r/stalker over the course of several days. for myself and many in the community i think the highlight was how this resulted in one of the dumbest interviews in the history of video gaming with the man who was the architect of the GSC Gameworld S.T.A.L.K.E.R. NFT program, one Vlad Panchenko, CEO of something called DMarket.

i would pull some quotes from it myself but i think i'm too close to this particular facet to be a good judge of what would be of general interest. if you're here reading this thread still after 140 comments just go take a look at that interview cuz it's chock full o' choice bullshit.
posted by glonous keming at 5:57 PM on January 15


I lolled when that dingus said "It's physical cyber-bullying" in that interview because... that's just bullying, and no it's not. Words have meanings.
posted by axiom at 11:56 AM on January 16


Speaking of Tim O'Reilly, he's written an article on Web3 which I found interesting.
This was also a really good read!
posted by Going To Maine at 6:46 PM on January 16 [1 favorite]


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