On the Dangers of Cryptocurrencies and the Uselessness of Blockchain

Earlier this month, I and others wrote a letter to Congress, basically saying that cryptocurrencies are an complete and total disaster, and urging them to regulate the space. Nothing in that letter is out of the ordinary, and is in line with what I wrote about blockchain in 2019. In response, Matthew Green has written—not really a rebuttal—but a “a general response to some of the more common spurious objections…people make to public blockchain systems.” In it, he makes several broad points:

  1. Yes, current proof-of-work blockchains like bitcoin are terrible for the environment. But there are other modes like proof-of-stake that are not.
  2. Yes, a blockchain is an immutable ledger making it impossible to undo specific transactions. But that doesn’t mean there can’t be some governance system on top of the blockchain that enables reversals.
  3. Yes, bitcoin doesn’t scale and the fees are too high. But that’s nothing inherent in blockchain technology—that’s just a bunch of bad design choices bitcoin made.
  4. Blockchain systems can have a little or a lot of privacy, depending on how they are designed and implemented.

There’s nothing on that list that I disagree with. (We can argue about whether proof-of-stake is actually an improvement. I am skeptical of systems that enshrine a “they who have the gold make the rules” system of governance. And to the extent any of those scaling solutions work, they undo the decentralization blockchain claims to have.) But I also think that these defenses largely miss the point. To me, the problem isn’t that blockchain systems can be made slightly less awful than they are today. The problem is that they don’t do anything their proponents claim they do. In some very important ways, they’re not secure. They don’t replace trust with code; in fact, in many ways they are far less trustworthy than non-blockchain systems. They’re not decentralized, and their inevitable centralization is harmful because it’s largely emergent and ill-defined. They still have trusted intermediaries, often with more power and less oversight than non-blockchain systems. They still require governance. They still require regulation. (These things are what I wrote about here.) The problem with blockchain is that it’s not an improvement to any system—and often makes things worse.

In our letter, we write: “By its very design, blockchain technology is poorly suited for just about every purpose currently touted as a present or potential source of public benefit. From its inception, this technology has been a solution in search of a problem and has now latched onto concepts such as financial inclusion and data transparency to justify its existence, despite far better solutions to these issues already in use. Despite more than thirteen years of development, it has severe limitations and design flaws that preclude almost all applications that deal with public customer data and regulated financial transactions and are not an improvement on existing non-blockchain solutions.”

Green responds: “‘Public blockchain’ technology enables many stupid things: today’s cryptocurrency schemes can be venal, corrupt, overpromised. But the core technology is absolutely not useless. In fact, I think there are some pretty exciting things happening in the field, even if most of them are further away from reality than their boosters would admit.” I have yet to see one. More specifically, I can’t find a blockchain application whose value has anything to do with the blockchain part, that wouldn’t be made safer, more secure, more reliable, and just plain better by removing the blockchain part. I postulate that no one has ever said “Here is a problem that I have. Oh look, blockchain is a good solution.” In every case, the order has been: “I have a blockchain. Oh look, there is a problem I can apply it to.” And in no cases does it actually help.

Someone, please show me an application where blockchain is essential. That is, a problem that could not have been solved without blockchain that can now be solved with it. (And “ransomware couldn’t exist because criminals are blocked from using the conventional financial networks, and cash payments aren’t feasible” does not count.)

For example, Green complains that “credit card merchant fees are similar, or have actually risen in the United States since the 1990s.” This is true, but has little to do with technological inefficiencies or existing trust relationships in the industry. It’s because pretty much everyone who can and is paying attention gets 1% back on their purchases: in cash, frequent flier miles, or other affinity points. Green is right about how unfair this is. It’s a regressive subsidy, “since these fees are baked into the cost of most retail goods and thus fall heavily on the working poor (who pay them even if they use cash).” But that has nothing to do with the lack of blockchain, and solving it isn’t helped by adding a blockchain. It’s a regulatory problem; with a few exceptions, credit card companies have successfully pressured merchants into charging the same prices, whether someone pays in cash or with a credit card. Peer-to-peer payment systems like PayPal, Venmo, MPesa, and AliPay all get around those high transaction fees, and none of them use blockchain.

This is my basic argument: blockchain does nothing to solve any existing problem with financial (or other) systems. Those problems are inherently economic and political, and have nothing to do with technology. And, more importantly, technology can’t solve economic and political problems. Which is good, because adding blockchain causes a whole slew of new problems and makes all of these systems much, much worse.

Green writes: “I have no problem with the idea of legislators (intelligently) passing laws to regulate cryptocurrency. Indeed, given the level of insanity and the number of outright scams that are happening in this area, it’s pretty obvious that our current regulatory framework is not up to the task.” But when you remove the insanity and the scams, what’s left?

EDITED TO ADD: Nicholas Weaver is also adamant about this. David Rosenthal is good, too.

EDITED TO ADD (7/8/2022): This post has been translated into German.

EDITED TO ADD (4/10/2023): This post has been translated into Italian.

Posted on June 24, 2022 at 6:13 AM151 Comments


Anonymous June 24, 2022 6:40 AM

hear hear, just because there exists a version of crypto that sucks less like that mr. Green is apparently trying does not mean it’s needed, does not justify the entire existing exploitative ecosystem with a rotten foundation all the way through with MLM-like fanatics and defending it is like pointing at colder regions in the globe to say “aha! Where is global warming now?” – just missing the point

XMR and Memes June 24, 2022 6:50 AM

“Someone, please show me an application where blockchain is essential. That is, a problem that could not have been solved without blockchain that can now be solved with it.”

Uses of Cryptocurrency:
1. I live in a former British Colony where demonstrators are taken into kidnap vans by the government. People set up bail funds for separate cases. How do you donate to a movement you are far away from in a privacy preserving way? [1.A]
2. A man evacuated Ukraine with his life savings in Cryptocurrency. XMR does not need permission from authorities and governments that are more concerned with imminent invasion.

The very resistance to regulation is what I find valuable.

Failed alternatives:
Cash: Traced and codes plus mail system tracking.
Credit Cards/Venmo/CashApp: Court records.
Gifts: Mail System tracking with vendors who open up to the government.

Bilateralrope June 24, 2022 7:12 AM

When it comes to Proof-of-Work vs other consensus algorithms, there is one thing I like to point out. There has been talk of Etherium moving to proof-of-stake for a while now. The date keeps being pushed back. I don’t know why, but I challenge people to come up with an explanation that doesn’t involve there being some serious problem with proof-of-stake scaling up to what Etherium requires. A problem that is currently unsolved.

So the first thing I’d do with regulating crypto is to ban proof-of-work to mitigate its environmental impact. The targets would be the exchanges who trade proof-of-work crypto and anyone running hardware to maintain those blockchains.

Then I’d wait to see if any blockchain based tech survives.

Xav June 24, 2022 7:38 AM

s/cryptocurrencies are an complete/cryptocurrencies are a complete/
s/More ore specifically/More specifically/

(You can safely remove this comment after use)

Clive Robinson June 24, 2022 7:38 AM

@ Bruce,

You forgot to mention “Helium” and

“Proof of Coverage”

I fall about with laughter every time I hear some crypto-geek who does not know the right way to use side-cutters wax-lyrical about it.

Especially when I ask “How big is your pole?” and I get a blank look.

It appears any nut-bar can think up a new,

“Proof of XXX”

Perhaps we should have a competition…

How about,

“Proof of coverage by flappy clown shoes.”

Marty June 24, 2022 8:21 AM

I’m so surprised by your take on this. The #1 thing you are confusing here, including Matt’s response is loosely clumping, Blockchain, Bitcoin and cryptocurrencies. I can go on, but there is too much nonsense (and truth, if we isolate the specific thing we are talking about) in here to start. Let’s have this discussion if we focus only on bitcoin and PoW and forget blockchain and “crypto”.

Frank June 24, 2022 8:26 AM

One use case I don’t see any non-blockchain aka distributed consensus—and no, proof of stake doesn’t tick the decentralized box—system might conceivably cover is censorship resistant electronic cross border transactions.

Now you could argue that we don’t really want that because it undercuts sovereign power, which is an interesting debate though IMO.

wiredog June 24, 2022 8:32 AM

The FBI has demonstrated that cryptocurrency is not privacy preserving.

Outside of cryptocurrencies/ponzi schemes? Eh, this xkcd covers elections: https://xkcd.com/2030/ and otherwise blockchain is an interesting mathematical idea that will probably be useful some decade.

Hilary June 24, 2022 8:45 AM

I agree with all of this, and would only add one more critique of Green’s response. Green’s response does not grapple with the fact that unnecessary complexity makes systems more fragile. As a result, he sees no difference between a system that is designed to be decentralized and then is subsequently centralized, and a system that is centralized from the get go. But the former is likely to be much more fragile – ultimately, crypto loses the decentralization but keeps the underlying unnecessary complexity.

Roger A. Grimes June 24, 2022 8:57 AM

One of the most ironic parts of blockchain, cryptocurrrency, and DeFi failures is the fact that nearly every solution the DeFi crowd proposes to fix the inherent problems of decentralization, scalability, usability, etc., looks far less like DeFi and blockchain and far more like traditional finance. They even give it cute little names like “off chain” or “third gen network” to hide the fact that the inherent technology does not work as advertised. If your technology worked as advertised and promoted, you would use more of it as your solution to your problems and not less.

Bilateralrope June 24, 2022 9:10 AM

Yes. Turns out that crypto wallets with a public transaction history but no name attached to that wallet are very easy to trace.

How well do they do against cryptocurrency tumblers ?

arkona June 24, 2022 9:15 AM

Someone, please show me an application where blockchain is essential. That is, a problem that could not have been solved without blockchain that can now be solved with it

I want to move my money across borders and I happen to live in Russia/Venezuela/the United States in a few years.

Shoal Creek June 24, 2022 9:16 AM

I generally agree with you, except on one point. Congress is incapable of regulating anything without injecting a ton of its own corruption into the system. It’s worse when the thing they regulate is already corrupt. Why would liars, thieves, grifters, and rapists who are owned by the billionaires club do anything without corruption?

Wm Ricker June 24, 2022 9:18 AM

So far the only actually useful application of blockchain is Git. The hashes make distributed development practical. We had used ClearCase for central control of a similar merge early merge often distributed development and it was horrid. Not a coin, not a fintech, but a FLOSS devtool.

XMR and Memes June 24, 2022 9:30 AM

Different currencies have different levels of privacy(XMR Monero)
Fiat on ramps and off ramps are a challenge, true.

@Clive Robinson
Helium Network
Background on packet networks suffering with no rewards:
-ADSB Exchange exists but coverage lacks in lots of regions (ND/SD/Idaho). Few people run nodes compared to the size of the population.
-APRS Repeaters are not common.

Background on other services operating without rewards:
-Torrents: People only seed to keep their ratio up.
-IPFS vs Filecoin: No rewards vs monetary rewards means filecoin has some power.

Everything costs money somehow. Taking a solution that is underutilized due to a lack of rewards (packet routing) and adding rewards subsidized by those who value most from its usage is a healthy practice.

kybernetikos June 24, 2022 9:34 AM

There are many examples in my opinion although lots are somewhat debateable, but here’s one that I think is the most clear:

It’s not possible for ‘tradfi’ (traditional finance) to offer flash loans – loans for arbitrary purposes made with zero risk to the lender because the lending fails if the funds are not returned as part of the same transaction.

Senor Burns June 24, 2022 9:50 AM

The “best” thing about blockchain and especially cryptocurrencies is the fact that a lot of morons and bullies invested a lot of money and made a big fuzz about it, but are now left in the rain with their pants pulled down.
But i feel a deep regret for all the relatives of these people who have to suffer too the consequences of other peoples bad decisions.

Hari June 24, 2022 9:54 AM

“Someone, please show me an application where blockchain is essential. That is, a problem that could not have been solved without blockchain that can now be solved with it”

Even if blockchains isn’t essential to solve any new problem (which isn’t the case), this is still a dumb argument. Cars also didn’t solve any problem that could not have been solved without them (everywhere I go with a car I can go with a horse) but they solve my problem faster and cheaper. And that’s enough to make them valuable. And the same thing happens with blockchains: they reduce transaction costs. And not to count the cases where it solves even more serious issues [1].

[1] https://twitter.com/LynAldenContact/status/1529084598268968962

Phill Hallam-Baker June 24, 2022 10:10 AM

Debating with the coinsplainers is like trying to nail jello to the wall.

There is the version of Nakamoto’s scheme that is decentralized, self-sovereign and independent of all regulation that doesn’t scale, doesn’t work and is rife with fraud and then there is the other version that is centralized and controlled by a cartel of crooks.

I do have designs that use techniques that could be called blockchain. But my use of those techniques predates blockchain. I tried to buy out the patent a decade before Bitcoin launched. These people chuntering on about the magic of blockchain are unaware that the technology was developed in the 1990s.

The only thing Hal Finney (aka Nakamoto) did was to combine a very good idea (Haber Stornetta hash chain) with a terrible one (Adam Back’s proof of work). Adi Shamir described a similar scheme to me privately in 1995 and I said I hated it (published as Micromint with Rivest’s Payword).

Ted June 24, 2022 10:14 AM

It’s a GREAT letter!

On a tangent related more to cryptocurrencies than blockchain, I’m curious how the $258 billion lawsuit filed against E. Musk for his promotion of Dogecoin will pan out. 🫣Johnson v. Musk

“… Johnson alleged that Musk committed civil Racketeer Influenced and Corrupt Organizations Act (RICO) violations through wire fraud, gambling, common law fraud, negligence, false advertising, deceptive practices, products liability by failure to warn, and unjust enrichment…”

We [heart] technologists working for the public good. Thank you for your letter to Congress.


AL June 24, 2022 10:20 AM

In testimony yesterday, Federal Reserve chair Powell acknowledge that the central bank had created new money (printed) to buy over half of the 2021 deficit, something called “monetizing the debt” and also called “quantitative easing”. Instead of actually borrowing to cover the deficit, they simply print money and “loan” it to the government. I call it “print and spend”.

The ECB is in arguably worse shape. The feature of Bitcoin is that there is a finite amount of it, unlike endless dollars.

While it looks like a lot of the irrational exuberance that pushed up Bitcoin is receding, I’m not sure it’s dead. Anyhow I’m not convinced I would want an alternative to traditional currencies regulated by print and spend governments that are simultaneously locked into printing/creating new money. It very much looks like they have gotten themselves into something that they can’t get out of.

David Wood June 24, 2022 10:24 AM

Bruce, I agree with your take, but I also have to make a devil’s advocate argument, because I’m really curious how you answer it:

The original argument for Bitcoin in the infamous Nakamoto paper wasn’t for privacy or thrift or any of the other issues under discussion here. It was that every fiat currency is eventually debased by its central bank, sooner or later.

What do you say to the justification that non-blockchain, fiat currencies are inherently inferior as a store of value to a system like Bitcoin, because with that peer-to-peer algorithm, there is no central bank that can debase the currency?

2022 is rather underscoring this point, as we’re right now watching the current fiat currency market leader, USD, go up in flames. Of course, the insane speculation around crypto and the small market floats are swamping any current correlation between dollar inflation and bitcoin-USD today, but we have seen folks in Venezuela and Greece coming to rely on crypto as a lifeline.

Anonymous June 24, 2022 10:32 AM

As others have pointed out, the only valid usage is digital money handling while avoiding regulation. Cash is soon to be abolished and we will need a new and battle tested way to handle illegal money in the future.

Whoever believes blockchain technology can do all the other things is wrong. Whoever believes that Bitcoin is to be used for legal transactions is wrong. Its sole purpose is to shield us from the removal of cash and increasing monetary transaction oversight.

We need to be able to safely move away from the Ukraines of the future. We need to be able to protect ourselves from possible capital controls. These things are happening in the 21st and will become worse in the future.

George June 24, 2022 10:35 AM

A lot of the arguments that you make can easily be applied to our entire economic system. It’s not like the petro dollar economy is not environmentally runinous (far more than bitcoin or any other crypto will ever be), that there are not constant scams that bilk people out of far more than has ever been lost in crypto, and that the entire market is not a lure to part the unwitting from their money. And its not like the government would EVER change the rules of the game at a moments notice like bailing out favored constituencies, creating money out of nothing or confiscating money one thought was safe in a bank because it needed to.

If you want to attack crypto over these points, I’d challenge you to apply the same concerns to the existing monetary system. You can’t. The real problem is absolutely political – crypto is unable to be completely controlled by the powers that be and that gives them a sad. That single reason is enough for me to want blockchains to continue to evolve outside of the influence of people who spout the company/government line.

Even with the crypto crash, I have made far more money through crypto since 2015 than I have from the stock market. Let me know how things go when the fed totally loses control and you have to explain why you were so against crypto as Americans can’t pay for a full tank of gas or the government prevents them from taking out the full amount they are entitled to from their bank accounts or their 401k plans.

fib June 24, 2022 10:57 AM

In a side comment, cryptocurrencies are falling in the midst of a [already predicted] crisis and the sky is not falling with them. This must mean something, but at the very least it exposes – and emphasizes – the cryptos’ lack of contact with the objective reality.

Based on the great prominence of the topic in the public discourse, I expected a real social unrest with the devaluation of cryptocurrencies. – or it is possible that we are only at a local minimum, or that the effects have yet to be felt, or…

David June 24, 2022 11:26 AM

Three use cases:

1) Shrink and simplify the post-trade infrastructure for securities transactions by replacing much of the DTCC clearinghouse process with a public (perhaps permissioned) blockchain. This would eliminate certain insurance costs and settlement risks and improve (actual) settlement times from days to minutes.

2) A public utility infrastructure for identity and access management. The “reads are free” model of the Ethereum blockchain make this a better deal than expensive solutions like Okta SSO while avoiding the many risks from using email providers (or, worse, SMS) as the root of the auth chain.

3) A generic exchange for the trade of assets having strong identifiers where the residual bulk metadata is stored offchain (albeit perhaps offline, but that is no different from other solutions). The set of assets having properties that fit this use case is not empty and some of them even have real-world value: the aforementioned securities, tickets to all sorts of events, priority access to the front of queues of all kinds. There is more here than hyperlinks to JPEGs.

The benefit of common public infrastructure for 2 and 3 is significant. Today, we have many duplicate implementations of the same systems: Stubhub, Ticketmaster, Okta, every other SSO, every “Fastpass” database, airline tickets. To be sure, not all of these require or benefit from trade but others do: The TSA cares who presents a ticket at the airport. Your grocery store may not care who presents of their loyalty cards at checkout, only that they have a stable identifier for forecasting. The event venue may not care who has one of their tickets for the show tonight, only that they have one.

mark June 24, 2022 12:09 PM

Yep. Cryptocurrencies had the real goal of tax avoidance. Almost immediately, it added illegal transactions and ransom. It’s great for that… until someone steals your wallet, or gives you their wallet instead of the actual ransomers.

Winter June 24, 2022 12:59 PM

We should look at the basic feature of cryptocurrency, the Blockchain.

The unique selling point of the Blockchain is a “difficult” to forge digital object coupled to a “trustless” consensus between the users about the creation of the digital objects.

I seriously doubt whether any other consensus mechanism than “proof of work” will be secure enough. Proof of work is easier to distribute and more difficult to capture than any other mechanism.

The only items that currently require an unforgeable digital object are currency coins in a trustless world. That is rather successful with over $100B of Bitcoin traded each day. The reasons are diverse, but I see a big role for a global distrust of the Western (US&UK) financial system, constant political meddling of the US with financial transactions, and a general feeling that the US$ can collapse any time due to the political irresponsibility of US parties, with a threatening coup d’etat. Those who amassed wealth in authoritarian states also want to move part of it away from fiat currencies.

On top of all this distrust and insecurities, there is the horrible inefficiency of international banking. Cryptocurrency transactions are expensive and slow, try transferring money to a relative on a different continent.

I have not yet seen any non currency related use of blockchains. NFTs are all the rage, but I have yet to see any use of that except as a proof that some money was paid. Not better than simply burning cash in public.

But who knows. Unforgeable digital objects sound intriguing.

Scott June 24, 2022 1:41 PM

Freakonomics Radio is doing a series on Blockchain right now. An example one of the guests brought up of a use for blockchain was the Walmart Canada distribution network – they now use a permissioned blockchain to track invoices. Reportedly invoices get paid quicker, the number of disputes has dropped, and Walmart Canada has better control of that portion of the business. I don’t know if there is a non-blockchain solution to this particular use case. I found it intriguing, as it is the first time I’ve seen a real-world use case demonstrated.

david June 24, 2022 1:55 PM

I really don’t understand these arguments. “Blockchain” is a collection of technology but at its heart it’s about byzantine-fault tolerant consensus and distributed protocols.

I explain this here (https://cryptologie.net/article/555/my-friends-always-ask-me-what-the-heck-is-blockchain-its-simple-really/) but if you’re looking at it from the outside, you should see blockchain as

1) a distributed database: it is here to emulate a centralized system, like a central bank! and

2) a distributed database that works even in the presence of malicious actors, so like an international central bank that wants to operate across borders

There’s nothing more than that, if you want to understand the technology in a financial scenario.

If you want to understand how this kind of technology can be useful outside of a financial scenario, think about the web PKI (which I wrote about here https://cryptologie.net/article/561/the-web-pki-20/) or protocols like certificate transparency and binary transparency, and how they could provide resistance against attacks (instead of detection of attacks) if they used a BFT consensus protocol.

Rick June 24, 2022 2:25 PM

Thank you Bruce Schneier for putting this up. My pay grade is to low to say what was said here in the essay, but it’s dead on why this crypto-junk drives me crazy. It only has value to bad guys.

Here is a simple stress test to prove to me at least that is’s worth a sh*t. I go up to where my money is. I say “today I’m going to cash out a big winner.” However suddenly this outfit tells me “oh so sorry that is not possible today…and may never be.” Why? Because all of those FDIC insured dollars you paid, (or some other currency) has bent spent by the people who run the cryptocurrency con you jumped into. Oh, sorry here’s the test part. Just to prove me wrong, why can’t all of these organizations who claim to be “stable” and backed up with “real money” simply move my tokens which get turned into the currency along the way of my choice to my bank account? What’s the hold up? It’s just crediting one account to another right? oh suddenly, because a lot of people have decided to take out “their” money they can’t, because? I love this part: the more of this crap is cashed in, the less it’s worth and what we have then is an old fashioned bank-run where they bolt the doors, pull the shades and put out press releases, because the vault is empty, because the owners of the casino spent all of the customers money on scam perpetuation and sports cars.

This cyrpto crap is no different in my opinion from every other boom and bust Spec investment. It always goes sky high and then it collapse under it’s own weight of bullsht with mom and pops wiped out. I read the other day yesterday’s millionaires forgot the golden rule like so many do. That is, always put away the vig for Uncle Sam. So, all of these people are on the hook for the income taxes they owe on all of that money that had never existed in the first place. The only people who ever do well with cryptocurrency are Ransomware crooks…and the ashole’s who started this bad faith money laundering swindle in the first place. Sorry if I got this wrong. I’m just a retired blue collar guy.

cmeier June 24, 2022 2:35 PM

@AL, @David Wood

Y’all need to take a good macro econ course and a macro econ history course. One of the reasons for the length and depth of the Great Depression was the failure of the Federal Reserve to increase the money supply. Same thing applies to the Long Depression of the US economy in the 1870s except that in that case, it was the inability to expand the money supply because of the gold standard. The world only came out of the 1870s depression when the gold strikes in the Klondike and South Africa expanded the money supply.

The world does not need to repeat the same macro economic mistakes using cryptocurrencies that were imposed by an inability to expand the money supply due to to an inflexible gold standard.

EvilKiru June 24, 2022 3:17 PM

@Wm Ricker: While git and blockchain both use Merkel Trees, git does NOT use blockchain. My sources are from doing a Google search for does git use blockchain and reading one article from Medium and one article from Stack Overflow.

SpaceLifeForm June 24, 2022 3:40 PM

The faster the cryptocurrency money laundering schemes collapse, the faster societal security will increase.

E.R. June 24, 2022 3:46 PM

Bruce is against some serious blockheads in this one. I mean “blockheads” in the same sense as “metalheads” are metal music aficionados.

Some Random Guy June 24, 2022 4:06 PM

Besides the technical issues that there are few use cases for blockchain (none of which justify the effort with which the BTC network contributes to higher energy costs in Europe and elsewhere) there are also the economical ones.

For one thing, that cryptos have the intrinsic value of $0. It is akin to an electronic tradeable gambling token you would get from a hotel in Las Vegas.

Anonymous June 24, 2022 5:37 PM

@George “Even with the crypto crash, I have made far more money through crypto since 2015 than I have from the stock market.”

You’ve “made” exactly $0 through crypto. Every single dollar you think you “made”, belongs to one of the idiots you convinced to “invest”, and who ended up in red. And that’s by far most of the people who “invested” in cryto, mind you. When they turn around and come back for blood, you’ll do well not to remind them that you have their money.

Just because you ended up above water, no matter by how much, it doesn’t mean you were right. You can also end up with a ton of money by robbing banks, it doesn’t make it right.

Some Random Guy June 24, 2022 6:50 PM

You can actually also make money playing lotto (a few people have) or by gambling in a casino somewhere. And you can lose money by investing in Luna coin around, say, March 2022.

Without any intrinsic value in the gambling token a.k.a. “cryptocurrency” one can not call it investing. It’s just gambling on the hope that there is someone willing to pay more for the token than what you paid.

Kind of like that old tulip bulb craze.

One could say that The Giant Crypto Gambling Machine is driven by equal parts of hype and hope feeding each other. But as of late, the accelerating downhill trend on the values of these tokens have made hype less and less viable. And, with that, the hope has also started to fade. Without ongoing support the value of these tokens will eventually come to rest at their intrinsic value which is $0.

SpaceLifeForm June 25, 2022 12:40 AM


It’s all good to disagree and view things from different angles.

The key is to solve problems.


Bruce Schneier wrote a rebuttal to my “rebuttal”!

Tired mom:

If you two keep arguing, then you both go straight to bed without any bitcoin dessert. I mean it!

Tired dad:

Didn’t I see this movie before? Let them fight.

It’s all good guys. Just poking fun.

Clive Robinson June 25, 2022 1:44 AM

@ SpaceLifeForm

At just before 07:30AM UK time (UTC+1 summertime) I went to your nitter link, and it came back immediately with a “Tweet not found”…

So I thought,

1, A mistake in the link?
2, A problem with nitter?
3, Posters remorse?
4, Twitter imploded?

And one or two other thoughts in quick succession involving “all out globle thermo nuclear war” 😉

So I converted it back to a Twitter link and I got thrown instantly into Google Search…

So not a Nitter problem (2). Which threw me into the root of MatG at Twitter, so probably not Twitter Imploding(4) which is a pitty 😉

So I’m guessing (3) might apply…

Unless you somehow mangled the URL (1), or nobody told me about any mushroom clouds B-)

SpaceLifeForm June 25, 2022 1:51 AM




Winter June 25, 2022 2:09 AM

@Some Random

For one thing, that cryptos have the intrinsic value of $0. It is akin to an electronic tradeable gambling token you would get from a hotel in Las Vegas.

That is literally true for every currency. Only a small fraction of currencies exist as “hard cash” for which the scrap/waste paper value is less than the cost of collecting and processing it. Even gold and diamond have little intrinsic value.

Clive Robinson June 25, 2022 2:14 AM

@ SpaceLifeForm,

And after 20mins, the Twitter link works…

And the Nitter link works…

Ghosts in the network twixt Twitter and the world I guess.

Mind you neither is realy a “rebuttal” just different angles on POV which I’ve mentioned several times previously always happens, thus is to be expected…

But the simple fact is the Blockchain is predicated on a flawed assumption that neither realy mention…

“The assumption that the Internet works”.

For a “Public Ledger” to work reliably it has to be available at all times not just for reading but writting as well. Whilst we can appear to solve the unreliability of “reading” by duplicate sites etc etc, it introduces other issues…

When the “blockchain” fans explain how they 100% reliably deal with the never to be 100% reliable communications, and how they can 100% stop such unreliability being “abused to advantage” why on earth should abyone take them seriously?

It’s all very well to say “location, location, location” about the worth of some vista, but unless you can dig down and say “Foundation, foundation, foundation” how on earth can you be expected to build a solid edifice?

t0pz June 25, 2022 2:48 AM

“Someone, please show me an application where blockchain is essential”

Very simple: there are financial products in the traditional banking system that are solid instruments for retail and institutions, like a Certificate of Deposit, for example.

The problem is that you have to trust a middle-man, the bank, to keep these CDs in order, not gamble your money away, or worse: that the bank won’t fail altogether.

Removing middle-men IS the only solution we all want fixed. Nothing else. This can be achieved in Decentralized Finance. However, the people fall for all these bs narratives that are selling their blockchains/tokens as some kind of “ultimate solution to everything” just so people buy into hype. This is not productive, at all.

Recognize DeFi for the solution to a specific problem that it is, and move on. Stop making it more than it is and be happy that you can be your own bank if you hold your own keys.

Sure, censorship-resistance is also a problem we care about and technically a Blockchain is more resistant than a centrally-fontrolled database, but that doesn’t mean it is regulation-resistant. Governments certainly can censor blockchains, if they so wish.

Clive Robinson June 25, 2022 2:59 AM

@ SpaceLifeForm, All,

Re : CNN quote of Musk Bankruptcy comment.

Whilst CNN might say Elon Musk CEO of various Corps might have mentioned the possibility of bankruptcy as fanciful comment in an interview to the Tesla owners group…

Let’s look at the statment that Musk made,

“The past two years have been an absolute nightmare of supply chain interruptions, one thing after another,”

It’s all true not just for Tesla, but nearly every other company that has “non-local” or worse “around the globe” in it’s supply chain.

No doubt they will all say it could not be “foreseen” but it was and was talked about for decades by several people and correctly identified as an extreamly fragile thus dangerous “neo-con mantra” along with “out-sourcing”.

Nature does not optimise supply chains to such fragility, several billion years of evolution points out why not…

If I could and did spot it for what it was, and raise a large red flag, how many others could have and should have?

But instead chose to go with the “short term thinking” that engenders a “race to the bottom” market that is most certainly not “free” as those that control them would have you think.

We are talking on this thread about “worth” and “wealth” of intangible tokens… That in reality are used to control resources and work applied to them.

Yet nobody has mentioned what these rokens of supposed “worth and wealth” realy are… which is a confidence trick.

Such that a very small minority can claim to “own” the majority of tangible assets. By insisting that their framework of “guard labour” which enforces the “Kings peace” at everyone elses expense is some how legitimate. When in reality it is realy another confidence trick to say “Might is right” and thus make “artificial claim” not just on tangible assets but through them the enslavment of others through “terrorism”.

The thing is squabling about which intangible token is the one to use, is realy fairly pointless, and just another side passage in the rabbit warren of distraction to keep people held in a state of increasing enslavment…

lurker June 25, 2022 3:12 AM

@Clive Robinson, @SpaceLifeForm
re blockchain depending on “The assumption that the Internet works”.

and the observation of an up to[1] 20 min lag in Twitter propagation,

so how does High Speed Trading ever work? Because apparently it does, sometimes. And the story of the crypto-coin wallet that emptied in 15 seconds . . .

Posting here can appear on page in as little as the page refresh time, or up to 7 minutes. No corelation yet understood with any natural phenomenon.

[1] Clive didn’t say if he was constantly refreshing the page, or if he went away for some refreshment for the inner man, then 20 min. later, lo!

W June 25, 2022 3:17 AM

Blockchains seem like a perfect fit to replace DNS. There is no reason to keep ICANN in charge of DNS records when this could instead be done trustlessly.

Clive Robinson June 25, 2022 3:22 AM

@ t0pz, Bruce, ALL,

Very simple: there are financial products in the traditional banking system…

That have been around longer than computers, and will still be around when computers and blockchain as we currently know them are looked on like the “horse and buggy” of the pre Victorian era.

All you are doing is running blind down the side pasages of the rabbit warren.

All the other “societal needs” presented for blockchain to exist are similar. Or actually worse they have arisen because of the use of “Guard Labour” to “terrorise” society thus “control” people and enslave them to a very few peoples tyranical or despotic demands od self entitlement…

Have a think about things a bit further… Actually question the assumptions that have been built into you, that have become a cognative bias, that you have alowed to become the chains that constrain you.

SpaceLifeForm June 25, 2022 3:32 AM

@ Clive, JonKnowsNothing, ALL

To quote the famous philosopher Yogi Berra:

“You can observe a lot by just watching”

Well, I have been watching for decades. I think outside the box. I connect dots.

Whether anyone cares or not about my dots, it only matters to me that there are good actors in position that are paying attention, and in position to create positive change. Positive for Society. Positive for Security.

I guarantee you that there are good actors paying attention. But, can they effect change?

There are plenty of bad actors that try to muddy the waters, and salt the fields. The list is long, but SCOTUS would be at the top now.

That said, I would not panic over the Roe v Wade decision.

SCOTUS has lost all credibility now, so not everyone will pay attention from now on. States Rights.

And that is actually a key Feature of the U.S. Constitution.

And what is SCOTUS going to do if a State ignores the ruling? Are they going to grab their AR-15s, and drive to Hawaii?

Clive Robinson June 25, 2022 4:10 AM

@ SpaceLifeForm, JonKnowsNothing, ALL,

Re : SCOTUS abd Row -v- Wade

Are they going to grab their AR-15s, and drive to Hawaii?

Personally no, institutionaly their bosses to whom they are beholdebt will.

I predict based on history,

1, The loonies will demonstrate
2, The locals will rightly complain
3, Local MSM will stir it up
4, The local guard labour will parade around being ineffectual
5, The crazies will show up and threaten and apply fear.
6, Federal Guard Labour becomes involved.
7, The nutters will destroy maim and kill.
8, The Federal Guard Labour will send in the “black boots” to pacify (via terrorism).
9, There will be “compramise” that many would call capitulation and the view of the majority will be subsumed.

Thus SCOTUS win, or more correctly their bosses that control them and also at arms length control the loonies / nutters / crazies through PACs and other “Black Financing” and the like will set society back a lifetime or more…

But then you will be told I’m just being cynical / paranoid / etc… But we’ve seen it happen before repeatedly as people will see if they actually studied history, rather than just accept what the ssanitised school books say…

Winter June 25, 2022 4:44 AM


SCOTUS has lost all credibility now, so not everyone will pay attention from now on. States Rights.

States are busy to limit voting to white male Republicans. SCOTUS will approve these laws.

You will simply lose democracy in America.

PS: The constitution is what SCOTUS says is the constitution. SCOTUS determines what you can do, say, or vote.

Clive Robinson June 25, 2022 5:10 AM

@ lurker, ALL,

so how does High Speed Trading ever work?

That depends on “Who Pays Who”, and as importantly “How”

Very contrary to what you are –lied to /– led to believe what you think of as the Internet is not at all a “level playing field”.

Start with looking up “contention ratios” and just keep going, you might be shocked at just how many millions some will pay for just a few nanoseconds advantage in a server room, or microseconds advantage on data links.

As for,

the story of the crypto-coin wallet that emptied in 15 seconds

All events,

“Have a time and a place”

If you know the “when, where and what” is going to happen because you planed it that way, then you can deliver your “payload” well in advance to the time and place, and have the event happen to the nanosecond of when you “script” says it should…

It’s why the Obama “Big Red Off Button” was a sad joke before it was ever mentioned and will remain so probably indefinitely.

As I occasionaly say of “Acts of God” and the like,

“There is no such thing as an accident, only a lack of information and the time to act on it”.

If I deny you either, then you are effectively powerless to prevent an event arising from not having them.

It’s a point most “legal claims” people do not want generally known, as it disturbs their business model.

But for “High Frequency Traders” it is the business model, where you try to use the laws of physics advantageously against your competitors…

The same principle works all the way down the Internet, one entity trys to be faster to your front door than another[1], either by technical acumen or fiscal dirty tricks, with the latter being by far the cheaper.

Just the way of the world if you know where to look…

[1] A trick that both the “Five Eyes” and various “Great Firewall” distopian tyranies have used and is currently used by the likes of Vodafone UK to try to force people to needlessly upgrade to over-priced almost certainly “back-doored” 5G handsets that won’t travel well.

Jordan Olaffsen June 25, 2022 6:07 AM

Bruce, the reason for Bitcoin is that it’s trustless and cannot be sanctioned. Think about people having their bank accounts frozen for mere suspicion of political disagreement (see Canada, recently).
Also, I’m astonished nobody has mentioned the lightning network, Bitcoin’s layer 2. It enables the nation of El Salvador to transact instantaneously, without fees, without electricity consumption.

Bitcoin is not “crypto”. Don’t lump it in with the rest of them

Mr C June 25, 2022 7:22 AM

@Scott: Just use a Merkel tree. There is no point whatsoever in a single-party blockchain. If you don’t have mutually distrustful parties operating the nodes, you’re not even inside the arguable use case.

Petre Peter June 25, 2022 7:27 AM

We don’t need block chain to fix inflation. We just need to trust governments with the presses.

Clive Robinson June 25, 2022 8:03 AM

@ Jordan Olaffsen,

[T]he reason for Bitcoin is that it’s trustless and cannot be sanctioned.

Bitcoin is at the end of the day a “Bag of Bits” or large but finite integer of a given form. It’s alledged ownership is by another “Bag of Bits” and tracable through yet another “Bag of Bits” which people chose to call “the public ledger” the purpose of which supposadly is to “prevent double spend”.

Well if the US Government uses the legislation it has, then all Bitcoins will fall in one of two lists it has,

1, Those that are clean (Whitelist)
2, Those that are dirty (Blacklist)

If you “trade” in Blacklisted coin then they simply move all your coin to the Blacklist, making it near worthless.

The US can do this because of the current position it maintains within world finance and the fact it believes it has sovereign rights across the entirety of mankinds domain.

Which would be laughable except for the US currently has the political power / control to make this happen.

It’s not what Bitcoin fan buois like to here but that us the short and the long of it.

So it can be quite effectively sanctioned, more easily than a stack of $100 or €100 notes with known serial numbers currently can be. Because it is fully tracable unkike the notes[1] even though they have unique serial numbers.

You have to realise that as far as Government Treasuries are concerned the short fall in the tax take via the unseen or black economy is seen in two ways.

The first is as crimes equivalent to “Denying Cesar” which require harsh and dreadful punishment to discorage others.

The Second is as non-crime by those who in effect by the legislators who do not pay taxes because they are alowed not to provided they “kick back” a little.

To give you an idea, it is estimated –depending on who you talk to– that just cross boarder VAT fraud in the EU is equivalent to an average or larger EU member State GDP…

Then there is all sorts of other crime, that politicians realy care absolutely nothing about other than it’s “Vote Potential” as rhetoric. However what they do care about though is the attendent fall in “tax take” that they use to pay off friends and bribe voters with come election time.

The big problem for the politicians is that their “friends” are “off shoring” any taxable income any which way they can to hundreds of trillions of dollars short fall in Treasury income…

So another change you might have noticed is the increase in “fines and seizures” via difficult if not impossible to defend against legislation. Advertised as being for stopping “Serious Organised Crime” the reality is it is used agains those who are asset rich but cash poor who can not easily aford to defend themselves. One part of UK legislation for instance makes it another crime to in any way encomber or dilute assets. So borrowing money or selling property to pay for a defence automatically makes you guilt of a more serious offence and so on… in an age old process known as “Rights Stripping”.

[1] There are political plans afoot to change this. The first is to get rid of ordinary copper and silver coins. The second is under “anti-laws” for counterfiting and laundering to make serial numbered notes much more tracable by installing scanners in cash handeling machines like ATM’s and later tills etc.

cmeier June 25, 2022 9:24 AM


What you describe is money under the mattress. It isn’t secure and doesn’t pay interest. I prefer to keep my cash in an institution that is insured and pays me interest. If the institution that has my cash fails and the FDIC doesn’t pay me back, it is likely that we are in world faced with a disaster so large that cryptocurrencies will have no meaning.

Winter June 25, 2022 9:49 AM


The US can do this because of the current position it maintains within world finance and the fact it believes it has sovereign rights across the entirety of mankinds domain.

You might have noticed that some countries do not like this and are working to get out of this arrangement. So are many rich individuals. Cryptocurrencies are one way to do this. Anyhow, most central banks are studying Blockchain technology as a way to improve efficiency in the hopelessly inefficient financial transactions.

As an example, China is working in a Blockchain based trading platform to be used for any trading with China.


BTW: Any discussion about blockchains that contains references to blockchain transactions “are just some bits” is just as outmoded as a discussion about whether the gold standard is better than a bimetallic standard. All financial transactions are nothing but traveling bits and a digital ledger.

Winter June 25, 2022 10:10 AM

@Jon, all

The Federal protections for being able to travel unimpeded within the USA will be restricted. States that make healthcare illegal, may already have laws on the books barring travel for healthcare or ready at-hand to do so.

Abortion is just the start. All birth control and with that privacy and the freedom to travel for all women is in the cross hairs. The US really will be a Man’s World.


In the 7-2 Griswold v. Connecticut decision, the court recognized for the first time a constitutional “right to privacy,” which it found was violated by the state’s law that made it a crime to encourage people — in this case a married couple — to use birth control. From there, this “right to privacy” would be expanded in later Supreme Court decisions to extend beyond married couples to other personal liberties. Griswold became the building block for other noteworthy Supreme Court cases that much of the GOP disapproves of, from Roe v. Wade in 1973 to the 2003 Lawrence v. Texas decision that ruled state laws banning “homosexual sodomy” were unconstitutional to the 2015 Obergefell v. Hodges decision recognizing a constitutional right to same-sex marriage.

Phill Hallam-Baker June 25, 2022 11:49 AM

OK Bruce:

Someone, please show me an application where blockchain is essential. That is, a problem that could not have been solved without blockchain that can now be solved with it.

Take a look at the Three Arrows fraud:


Now I am going to claim that when people talk about ‘blockchain’ what they are really talking about is the Haber-Stornetta notary chain patented in 1990. What is now being called structured cryptography so that we don’t have to use the word ‘blockchain’. You can call this cheating if you like.

The Three Arrows fraud was made possible because the various documents that Three Arrows used to make claims about assets on deposit, etc. etc. were never checked because the current financial infrastructure doesn’t allow it. All you need to borrow a half billion dollars from certain banks is a well cut suit, an expensive wristwatch and some Excel spreadsheets. The only thing they are likely to consider the authenticity of is the watch.

A transparency infrastructure using immutable notarized chains to provide attestation of assets on deposit could have exposed the fraud much earlier.

But of course, that doesn’t exist, not even in the crypto-currency world which is allegedly founded on this type of technology.

The Three-Arrows Ponzi doesn’t really meet Bruce’s criteria because it was a Ponzi scheme running within the crypto-currency world. But the same schemes run in the traditional finance world.

So there are applications but Blockchain should get none of the credit because proposals for applications of this type predate Bitcoin. The problem isn’t lack of technology, it is deployment.

AL June 25, 2022 4:15 PM

Article about Paypal expanding crypto services on their platform.


PayPal and its Venmo app are used by hundreds of millions of people all over the world to move money. …

Some PayPal customers can now move their cryptocurrencies such as Bitcoin from their accounts to external wallets and exchanges.

… all eligible customers in the US will be able to use the feature in the coming months.

SpaceLifeForm June 25, 2022 4:25 PM


Crypto Reminder

Please avoid using the generic term ‘crypto’ unless the context is clear.

Specifically use ‘cryptography’ or ‘cryptocurrency’ as appropriate when the use of ‘crypto’ could be misinterpreted in a writing where the context may not be obvious.

This can happen in long threads where partial blockquotes have occurred and the reader has not read the entire thread.

They are definitely not the same concept.

SpaceLifeForm June 25, 2022 7:22 PM


re: Crypto Reminder

I am not picking on AL in this instant case, because I did not see the comment before I made my comment. Which apparently occurred during my code review.

But this timely comment by AL clearly demonstrates my point.

Article about Paypal expanding crypto services on their platform.

So, Dear Readers, I ask:

Is this about communication cryptography or about cryptocurrency?

I can spot the context because AL provided a snip. I can spot the context just from the link that AL provided.

But, if AL did not provide context in the comment, would you know what my blockquote means?

What if AL made the comment days ago and you did not read the entire thread?

Now, imagine reading this comment standalone, because I did not include a link, and you have no context.

Spot the problem?

So, AL, I thank you.

MarkH June 25, 2022 11:30 PM


Many worthwhile comments in this thread, thanks!

Two realities worth bearing in mind:

[1] On average, the cost (not to be confused with price) per BitCon transaction is roughly 1,000 times that of electronic transactions with actual currencies.

There are many competitors, but BitCon still has about 4/9 of all “cryptocurrency” market capitalization, and is about three times the size of its nearest rival.

[2] For most countries with their own state currency, taxes must be paid in that currency. Even if you suppose that fiat money has no intrinsic value, most participants in a national economy must obtain it.

MarkH June 25, 2022 11:38 PM


You make an good point about ambiguous use of the term “crypto”.

I try (with a certain failure rate) to make my comments as clear as possible, so people don’t have to “puzzle out” what I mean.

If you’ll follow your own wisdom, I’ll read about twice as many of your comments as I do. To my ageing gray matter, many of them have a sort of oracular “nudge nudge wink wink” quality which I find, frankly, cryptic.

When I see that, I skip.

FDR is supposed to have advised to those preparing to speak:

Be sincere
Be brief
Be seated

My own version is:

Say what I mean
Mean what I say

Shawn Hargreaves June 26, 2022 12:55 AM

Several of the comments here attempt to answer “what is blockchain good for” with the example of transferring money across governmental boundaries. Supporting dissidents under a totalitarian regime, extracting life savings from Ukraine, etc.

This argument is myopic. You can send bitcoin, maybe, as long as the government in question has not censored access to it (which one like China easily could). But bitcoin is not money. Sender and recipient both require an exchange to convert between cryptocurrency and something of real world value, and these exchanges are every bit as subject to government control as any other financial institution.

It’s only possible to argue that cryptocurrency evades censorship by focusing purely on the substrate while ignoring essential other parts of the system. Actual security is a whole-system problem, though.

Clive Robinson June 26, 2022 2:54 AM

@ Shawn Hargreaves, ALL,

Re : security is a whole-system problem

Yes it is but how big is “whole-system”?

It’s only possible to argue that cryptocurrency evades censorship by focusing purely on the substrate while ignoring essential other parts of the system.

Just one tiny part put forward by proponents of the crypto-coin systems as a be-all and end-all, is indeed a tiny tiny highly blinkered view point.

However a problem few ever realise about “systems” is how “organic” they realy are let alone how “intertwined” and how they “evolve”.

We can stand at the trunk of a lone majestic tree in open farmland or country shaded by it from the sun. We look up into the canopy and see the branches, we look down we see the ground as dirt with some grass upon it, and we think we understand what we see from what we were told at school.

We walk out from under the canopy into the sunlight to maybe as little as three times it’s hight away and look again. We look down the ground has more lush growth, we look up and see not the trees branches but it’s leaves.

Do we understand the lessons in those observations at slightly different points of view?

Mostly no not unless you are asked to do so, we just don’t think about them.

But even then it is a lot less than half the knowledge to be gained, because we can not as easily observe the more important part the tree roots and the symbiotic relationship they have with bacteria in the ground, and much much else besides of other living creatures.

We think we understand the system, but the truth is we do not, all we can hope for is to understand some tiny part of it.

Because the system that sustains the tree is not local, nor is it global it encompasses the solar system we live in and supernovas in times so far in the past there is no memory just the star dust of ages drifting through space, to be caught by other systems, to eventually become the minerals needed.

Even the simplest of evolving systems, on their own are complex beyond most peoples imagination, taken as a working eco-system mankind does not understand even a fraction.

Oddly perhaps, mankind does not even understand most of the evolving systems we have built… Nor do we, as mainly we see that as “Somebody Elses Problem”(SEP)[1].

For instance the recent starting of “supply chain issues” were uterly predictable, and were, even stated on this blog years ago. Yet more than 99.9..,% of the population either did not or chose not to understand sufficiently to see what was inevitable, even though through nature and evolution the evidence is clearly all around us. Worse when toilet rolls were not on the shelves, who was blaimed? Yup the people who had, had the foresight to buy sufficient quite some time ago. Why? Well because they dared to be different, to observe and apply a little rational thinking[2].

We as, mankind have a very great deal to learn, especially about our own failings. But it is also upto us to learn wisely, and as Shakespeare wryly said “ay, there’s the rub”. Most are not, nor will they, willing to even observe let alone learn, they don’t want to, they see no reason to, because… “they know better”. It does not bode well for our “understanding systems” or seeing where we are being a great deal less than sensible about our actions…

An immediate observation for all is “Energy will soon be too expensive for 2/3rds of people living first world life styles, and there is a more than 1/5th drop in world food production”. What can we reason from that?

[1] The notion of “Somebody Elses Problem”(SEP) as a way to ignore important things, is once it it is pointed out to you obvious and it explains much. But all it realy tells you is, “We as mankind, have totally failed to grasp one of lifes more important lessons is out there to be learned”… Which in turn begs the question “What else have we missed that is obvious in hindsight?”… To which the answer is one of “We will probably find out the hardway” or “We may never know because it is so obvious”.

[2] Call it what you like, but as a general historical observation “mankind as a beast” is neither thinking or rational, and way way to rapidly forgets any hard won knowledge from extraordinarily painful lessons of even the living past. To see why, ask yourself, “What lessons have we learnt about ‘Globe spaning supply chains with no resilience’?, and what have we done with the nowledge gained?”…

SpaceLifeForm June 26, 2022 4:16 AM

@ Winter

The constitution is what SCOTUS says is the constitution. SCOTUS determines what you can do, say, or vote.

Nope. The constitution says what is in the constitution. The only role that SCOTUS really has is to affirm, remand or reverse lower court cases. Their role solely is to make sure that lower courts do not violate the constitution and the laws.

The fascists want everyone to believe that SCOTUS is Supreme!

SCOTUS can not write laws. They are not Congress. They do not write any laws, even though some think they can. Those that disagree will have to go back to their lower court, and create more billable hours for the lawyers.

Of course Governor Right Clique jumped on the fascist bandwagon immediately.


“Nothing in the text, history, or tradition of the United States Constitution gave un-elected federal judges authority to regulate abortion. We are happy that the U.S. Supreme Court has corrected this error and returned power to the people and the states to make these decisions,” Parson said.

I’ll just note that Federal Judges are not elected. That includes SCOTUS.

Sure looks like the fascists think the un-elected SCOTUS in 1973 was bad, but the un-elected SCOTUS in 2022 is fine. Give me a wire hanger.

But also note that nothing in the constitution gives any authority to anyone about regulating abortion. It ultimately is not a state right. It is a human right. A female human. Trust me on this, the women are pissed off.


Gov F12 Parson is pandering to the base.

If SCOTUS has a conniption fit with Hawaii, and want to travel there, should they Roe or should they Wade?

0x77696c6c June 26, 2022 9:42 AM

Vast amounts of time are used to mitigate the risks of fraud and error in assessment and audit. Remove the problem of trust- as only blockchains can when we talk about globally scaling, top down regulations audited in a variety of methodologies by a variety of interpretations from a variety of auditors, and you instead have an efficient, constantly active, reliably efficiently verifiable (succinct computational integrity and privacy proofs placed onto DLTs which are massively distributed) record of all auditable activities that can be automatically, publically, privately assessed and the assessed entities can get on with working towards actual security instead of lurching form one audit to the other in any given calendar year. The blockchain element of this stack enables “trust” in a way that any solution without blockchain is not as good at or is open to additional risk in doing so. By removing the third party model.

Is it anywhere close to working yet? No. Is it decentralised enough, yet? No. However it is theoretically a more optimal solution to this problem than anything else. Is anything else closer to the ideal definition of a secure blockchain that (arguably) ethereum or bitcoin?

A weak analogy to consider; Was IDEA, DES, etc, ever perfect? Probably not. However DES was at least the most optimal solution we could think of for a respectable amount of time. Did we improve on them – yes. We didn’t give up just because 99% of attempts were corrupt. Luckily for cryptography, it never had to face such a bizarre set of environment challenges or may have taken us a lot longer to reach AES.

Jpetersen June 26, 2022 9:45 AM

Proof that cryptocurrencies are needed: “the Subversion of NIST by the NSA”. Govt cannot always be trusted, and so having a currency that is outside of govt control is a worthwhile endeavor. This tech is in its infancy, and so it has problems, but these problems can be worked out. The goal of detaching funds from govt control is useful when govt does things which are unjust, something that occurs with every govt to one extent or another.

Jesse Thompson June 26, 2022 12:03 PM

You know what? If Bitcoin is so worthless, then you should easily be able to sell me one for a hundred dollars.

No wait, a thousand dollars. USD.

I’ve got Paypal, Venmo, Zelle. I could send you a money order or a wire transfer. Do you need me to fly to your town and hand you wads of bills? I think I could swing that too.

I just want you to demonstrate to me how little value these things have and part this fool from his money in the process. Come out richer on the other side, and prove your point.

So what are you waiting for? One measly Bitcoin for a cool grand. How could you not?

Yet you won’t.

In fact, you can’t. And worse yet: you know it.

So by all means, get congress to regulate it. Pwn the blockheads in comment threads with your withering retorts.

I’ll just be sitting here fanning myself with ten (you know what? eleven!) Benjamins wondering why none of these know-it-alls is willing to put my money where their mouths are. 🙄

Clive Robinson June 26, 2022 1:13 PM

@ Jesse Thompson,

You know what? If Bitcoin is so worthless, then you should easily be able to sell me one…

In certain collections of I asume are some fairly rich people, there are “Merde d’ Artiste” cans, that have been shall we say decaying for over six decades[1].

In 1961, Piero Manzoni who’s father owned a vegtable canning business and had critizied his endevors decided to get rehrorical on the notion of “making him eat his own words”. Apparently with little strain or effort Piero produced ninty small cans, numbered the lids etc and sold them.

Apparently they would be worth around 3million if they were to come on the market today.

Do you seriously consider a small tin of crap of the artist to be worth oh 5times the highest value of a bitcoin?

If so I’ve a bridge I can sell you from London at a reasonable rate of oh $100 a stone, you will however have to “collect”.

With regards your offer,

In fact, you can’t. And worse yet: you know it.

The fact that I as the seller have set a price that you do not want to meet is proof of squat. Because it does not mean that either there will not be a buyer, or that any buyer could not sell it on at an increased price.

If I’d offered to sell you a bitcoin for 30,000 a few weeks ago you would have bit my hand off because people claimed they were worth 60,000, now however when they now claim 20,000 you would not buy.

I’ll happily sell you one bitcoin for $100,000 but I think your words,

“In fact, you can’t. And worse yet: you know it.”


If you believe the basic rules of economics, supply and demand set the price, not the intrinsic value.

This is “obviously true”, in maby peoples minds but is it?

Because if you open your wallet or money clip and take out a bank note for say €10 you will be able to exchange it for €1 coins of greater intrinsic worth.

Even though the metal prices are quite volatile currently.

[1] https://allthatsinteresting.com/piero-manzoni

SpaceLifeForm June 26, 2022 7:06 PM

@ JonKnowsNothing, Winter, ALL

I (and hopefuly others) appreciate that you spent the time and effort to explain things that I did not want to spend time on during code review,

In defense of Winter, I’ll note that since he does not live in the US, he has not experienced how this works.

Just because I can (there is no law at State or Federal level that says I cannot stir the pot), let me stir the pot a bit, and note that the Missouri Plan does not apply at Federal Court level.

It should.


SpaceLifeForm June 26, 2022 7:33 PM

@ JonKnowsNothing, Clive

I guess you have not caught the news that Tesla is laying off newly hired workers in Texas.

As I have mentioned before, Elon does not have the scratch.

SpaceLifeForm June 26, 2022 8:29 PM

@ Steve, JonKnowsNothing, Winter, Clive, ALL

Even so, all they need is a compliant Congress and Executive Branch to draft, pass, and sign a Federal law, no matter how unconstitutional it might be, to put any law they wish onto the books and keep it there.

That has always been the plan of the fascists.


America is the great human societal experiment.

There is a very sound reason why there are 3 branches of government.

Can you spot why the Senate did not take a break at the end of Obama’s second term and instead stayed in session to prevent Obama from making a recess appointment to SCOTUS?

Can you spot whom Obama was going to appoint?

Do you know who the current USAG is?

Can you connect the dots?

Can you spot why Trump losing was so important?

Can you spot why the SCOTUS ruling on Roe v Wade will backfire?

The great human societal experiment is not over. Vote.

SpaceLifeForm June 26, 2022 9:41 PM

@ John Brown

CC: @ JonKnowsNothing, Clive, Winter, ALL

Got a link?

Nevermind, we got it.

It is a good thing when you make my case.

Thanks for playing.

lurker June 26, 2022 9:49 PM

The AI lets John Brown post his diatribe, but our philosophising goes mia. Perhaps JB has noticed like me that it observes the sabbath.

SpaceLifeForm June 26, 2022 10:22 PM

@ lurker, ALL

in re, re, re:




but our philosophising goes mia

It does not. Remember that ‘stuff’ may disappear due to ongoing investigation, and you may have touched on it too closely. Being cryptic helps sometimes.

As you noted, Weakends.

That is NOT a typo.

zero June 27, 2022 10:16 AM

To me, blockchain is a good example of a solution that’s looking for a problem to solve (and to justify its existence)

tim June 27, 2022 12:14 PM


Proof that cryptocurrencies are needed: “the Subversion of NIST by the NSA”. Govt cannot always be trusted, and so having a currency that is outside of govt control is a worthwhile endeavor.

How does a “currency” (using that term loosely here) solve the influence of one government organization over another?

so having a currency that is outside of govt control is a worthwhile endeavor.

What does this have to do with your prior statement? And how is creating something that is harder to use, value fluctuates widely, costs more (in both energy and in using it) and has no backing from any institution or government a “worthwhile endeavor”? Unless you are a thief?

Toby June 27, 2022 12:34 PM

There’s a pervasive and dangerous attitude the Coiners have to justify it all that it’s all still in development, that all this stuff is going to be fixed a few years from now. While I wholeheartedly reject the premise, it is baffling to see this accepted uncritically by large swathes of the tech industry, as though there must be a “there there” and thus this must continue unimpeded. Using cryptography as an example, a half finished buggy algorithm being used in production actively perpetuates harm regardless of the promise of future development. The debate is hijacked to suggest that to oppose the production use of these systems is to oppose any and all research into these fields, which is simply not true.

Every issue caused by blockchain based systems comes from the system part, when these things can and should be relegated to git repositories until many, most, all of the underlying problems are addressed. But Coiners cannot allow this to happen as this cuts off their access to funding from unsophisticated retail investors for what are charitably describable as high risk experiments.

AL June 27, 2022 1:25 PM

Article/informational piece on blockchain.

Some companies that have already incorporated blockchain include Walmart, Pfizer, AIG, Siemens, Unilever, and a host of others. For example, IBM has created its Food Trust blockchain to trace the journey that food products take to get to their locations.

Using blockchain gives brands the ability to track a food product’s route from its origin, through each stop it makes, and finally, its delivery. If a food is found to be contaminated, then it can be traced

Bartosz Solowiej June 27, 2022 1:51 PM

I like how you think, but I wonder if you can offer an alternative solution that will be made better without the following procedure.

Several of my clients want to archive blocks of transactional logs, salt each block with the prior hash, sign the current block with a hash, compress it all and store it in a shared archive so everyone can unpack and audit financial transactions for a prescribed number of years in the future.

The clients like this idea because it creates an immutable record shared among departments within their governments. It also allows the clients to demonstrate fiscal accountability within the walls of their overarching organization; if any one of the departments attempts to alter the transactions in the archive, the other departments will detect the discrepancy and through a democratized record, hold each other to account, thereby strengthening the true value of the monetary base by mitigating against corruption in this manner.

I’m working for a large international development organization with headquarters in DC. I wonder what you will recommend that we pursue as a solution to this systematic application structure for archival transactional data?

Thank you,

Martin Sewell June 27, 2022 5:18 PM

In my mind, the blockchain was an ingenious solution to a technical problem (the double-spending problem), but doesn’t solve any real-world problems (unless you’re a libertarian or a criminal) because any system that has any dependency on data in the real world requires a trusted third party to validate the data, which renders a blockchain pointless. After thirteen years, the only effective use cases of a blockchain are as a cryptocurrency and for timestamping.

Clive Robinson June 27, 2022 8:18 PM

@ Toby, ALL,

… it is baffling to see this accepted uncritically by large swathes of the tech industry …

Two things get said over and over,

1, After every party there is a crash.
2, People do not learn from history.

These can be explained away by,

3, Live for the moment
4, Short term thinking.

However… the first whilst true is not all it appears… Logically if we invert things we get,

1b, If there were no parties there would be no crashes.

Which most people would say is a false premise.

Thus the implication that “parties” and “crashes” are independent of each other and people are seeing coincidence as causation in the framing of the first statment.

But the question has to be asked,

“As such ‘coincidences’ are so common, are we not seeing ‘causation’ for some reason?”

To which I strongly suspect is true.

Though it might sound like a conspiracy, I suspect “party followed by crash” is a causal relationship in quite a few cases.

Those are many seperate types of causation, but underneath they all have one thing in common,

“Intention to hide information for gain.”

That is “fraud” in the form of “long cons”, “short cons”, “pump and dump”, “bubble markets”, “black tulip markets” and oh so many more.

The basic steps are,

A, Create a “market”
B, Create what becomes 20-30% of market.
C, Trade it in spirals to create churn
D, Use the churn to drag money in
E, Play the end game.

It’s the end game that changes, but the aim of it is to over value the market, so that the 20-30% when cashed out takes more than 50% of the over inflated value.

In essence they “take ALL the value” and what is left colapses to nothing as the ballon deflates to some fraction.

In a “short con” you,

“Grab the money and run”

Which is what we see with “rug pulls” and the like.

In a “long con” you “sawtooth” that is you go through several cycles. You trade out your 20% when the price is high say 100, when the price slumps to say one third of that or 33.34 you buy back your 20% or more in a way that causes the price to rise again, this draws in fresh “speculator” money and when the price gets high enough you do it all again, and again…

Whilst a “short con” is seen as a crime, the “long con” is seen as being an “informed speculator”, unless you can show “insider knowledge”.

But what if you do not need “insider knowledge” because you control the marketing system.

That is you “buy and sell” for many or the whole market. But you keep the favourable trades, and push the unfavourable trades out to others.

You keep the plum gains and they get a mix of ok gains and losses.

In essence that is what “currency deakers”, “share traders”, “Hedge fund managers” have all done.

They give you enough of a taste to keep you hooked, but the good stuff the cream of the cream they keep for themselves.

To hid this behaviour as a cartel they “take some hits for their friends”. That is they make themselves a looser, to make a friend a winner, and the other way around. That way they can show their losses and claim “you don’t always win, neither do we” so they can say obviously they can not be crooked.

But… We know from past “hidden sponsoring” of politicians their investments strangely pay off way better than most. However “for the sake of proprietary” they get others to “manage” their investments…

In otherwords “bribes/kickbacks with deniability”.

The reason we don’t spot the causation is not because it’s not there, but because the end games are so varied they can be difficult to correlate if you look to closely.

However stand far enough back and you can see what comes before… Now some people will spot the trends and ride them profitably. Are they involved with the actual crookedness of the “Hidden hand of the market”?

Not realy but they are very probably more than aware of what is Godng on but will take the profit. That is they are like the people who buy stolen goods in car-boot sales and the like. They have more than “reasonable suspicion” that what they are getting is at best questionable but they are not going to ask, they are going to “take the bargain”.

As long as everyone who is making money takes a “short term view” and a few minor losses enough to “look honest” then they can keep the crookedness covered up…

Money laundering also works on such hidden spirals. “property speculation” is one way where you buy up dirt cheap property and you “do it up” and “build up the area” you can sell properties around building up the price 5-15% each year. The fact the sales are realy fake, is hidden in various ways but the result is that dirty money goes in and nice clean profit comes out. It’s one reason so many serious / organised criminals involved in drugs, people trafficking etc are “builders”.

Artwork is another way to “launder money” and you can see it going on if you know where and how to look, and yes the big auction houses not only know it’s going on but also get a piece of the action.

Any market where the “product” sells for more than 10 times what goes in is very probably being used for money laundering… Especially where the price is based not on reality but some unquantifiable measure. Take fashion for instance, Gucci hand bags sell up into the tens of thousands of dollars range but actually have no more in them than a hundred dollar no-name bag. Thus Guggi amoungst other “luxury” bags appeal to criminals in many ways just one of which is drug money laundering…

Web 3 and “Non Fungible Tokens”(NFTs) is a “market made in heaven” for short cons, long cons, and money laundering…

Crypto-coins will hang around for a while yet but they almost certainly will become one of the first “Black Tulup Bulbs of the 21st Century” in history books of the future. NFTs will follow on and they to will have their 15minutes of fame with the crooks, before the crooks move on…

SpaceLifeForm June 27, 2022 8:26 PM

@ MarkH, Clive, JonKnowsNothing, lurker, Winter, ALL

Cryptic Taxes

I that a good start? Did you see that I connected some dots? Probably not. One may shake their head, WTH is a ‘cryptic tax’? I am going to spend some time on this code review, probably near an hour. Or more.

Alright, lets start with your completely valid point that I write cryptic comments.



If you’ll follow your own wisdom, I’ll read about twice as many of your comments as I do. To my ageing gray matter, many of them have a sort of oracular “nudge nudge wink wink” quality which I find, frankly, cryptic.

When I see that, I skip.

But, there is a reason that I do that which is not obvious. My ageing gray matter has not lost the plot yet.

We have been training an AI for over two years now, and as you are well aware, certain stuff will instantly go into the Black Hole, never to escape. See BHMT.

So, sometimes, it is important to be cryptic, so that the BHMT will not kick in.

As Clive noted:


We think we understand the system, but the truth is we do not, all we can hope for is to understand some tiny part of it.

Moving on, lets get to


For most countries with their own state currency, taxes must be paid in that currency. Even if you suppose that fiat money has no intrinsic value, most participants in a national economy must obtain it.

This. There is no way that any sane government would accept cryptocurrency for tax payments.

No way. Not happening.

The reason is that fiat currency is more stable in value, and that is critical for a functioning stable government.

The government needs stability to plan income and expenses.

Cryptocurrency is a fascist attack on government. Full Stop.

So, circling back around here, can you you see why I used the term ‘cryptic taxes’?

Well, it is not just about government taxes and crytocurrency.

A ‘cryptic tax’ also means that you may be too lazy to read and educate yourself.

Whiner: “I went to be spoonfed talking points. I don’t want to think and actually do research. So hard. I want to watch Fox!”

So, when I do a cryptic comment, there is a reason.

[This post slowly grilled on the NoPreview grill for over 90 minutes with CodeReview Seasoning Sauce]

Clive Robinson June 27, 2022 8:31 PM

@ Martin Sewell, ALL,

After thirteen years, the only effective use cases of a blockchain are as a cryptocurrency and for timestamping.

You forgot to mention,

“Timestanping does not require ‘Proof of Work'”.

So under many peoples notion of a “blockchain” the use case drops to just “cryptocurrency” and all the crookedness that goes hand in hand with it.

When ever I hear about a new use for “blockchain technology” I immediately look to see if “proof of work” is required, and mostly I find it’s not, which means in turn “blockchain technology” is not needed.

SpaceLifeForm June 27, 2022 10:50 PM

@ MarkH, Clive, JonKnowsNothing, lurker, Winter, ALL

html barrier movie

I’ve seen this movie before.

After 90 minutes of CodeReview, I know I did not mess up the html. I know Clive has seen this also. It is always the first blockquote that gets broken.

I will now throw up a barrier. So, watch this ology unfold over time.

If you see a bolded cryptic comment, that does not mean I am screaming. But, I may be.

Maybe I will go to Italy.


The blockquote should have ended with

‘When I see that, I skip’

What was after that was my comment.

Bob June 28, 2022 1:35 AM

This note argues, that blockchain works for use cases where:
– A trusted intermediary is absent, too expensive, or is losing trust
– There is a need for anonymity of parties

since there are no practical alternatives to blockchain in such cases.

It also provides several examples that fit the condition above, like owning US dollars in some developing countries, without the fear of confiscation.


SpaceLifeForm June 28, 2022 3:30 AM

@ Clive Robinson, Martin Sewell, ALL

Stomping Kangaroos


After thirteen years, the only effective use cases of a blockchain are as a cryptocurrency and for timestamping.

The latter is probably questionable.

Fixing Clive’s touchscreen typo for clarity.


“Timestamping does not require ‘Proof of Work’”.

I believe you will learn that statement is False. See US v Schulte.

What is a Clock? Is this bit string really a TimeStamp?

How do you know? Can you prove it? Can you prove it was not changed?

Do you have a cryptographical signature the proves it was a Timestamp and that it was never altered?

It will take many more bits than most people have considered.

We are definitely over 1024 bits to securely authenticate a 64 bit timestamp. And that assumes there is a keypair securely stored elsewhere.

“Does Anybody Really Know What Time It Is?”

MarkH June 28, 2022 4:27 PM

@AL, Clive, all:

Thanks to AL for offering a real-world example, the IBM Food Trust. It seems to be based on or related to an open source blockchain project called Hyperledger Fabric.

I assume there must have been some consensus that this form of blockchain was a near-optimal realization for the project requirements.

Note that Food Trust does NOT use any grotesquely brain-dead “Proof of Work” consensus algorithm, so its transactions are efficient and inexpensive.

In this essential, it differs (as far as I’m aware) from blockchain as incorporated in any of the major “cryptocurrencies”.

Clive Robinson June 28, 2022 8:12 PM

@ MarkH, AL, ALL,

In this essential, it differs (as far as I’m aware) from blockchain as incorporated in any of the major “cryptocurrencies”.

As I understand it –see my earlier comments– there are,

1, Blockchains.
2, Chains of Merkel Trees.

The difference is some kind of “proof of work” (which is a laughable joke in Helium as it’s “proof of coverage” which is so easy to fake you can make jokes about it).

Which brings us to,

Note that Food Trust does NOT use any grotesquely brain-dead “Proof of Work” consensus algorithm, so its transactions are efficient and inexpensive.

So I would argue from that POV the IBM system is not a “Blockchain”(1), but a “Chains of Merkel Trees”(2).

People are free to take their own view on this unless an “official arbitrator” comes forward with a solid definition…

@ SpaceLifeForm, ALL,

I said,

“Timestamping does not require ‘Proof of Work’”.

And you said,

I believe you will learn that statement is False. See US v Schulte.

It’s easy to show on the technical side a “timestamp” does not require a ridiculous “proof of work”.

For instance there is a simple case of a newspaper printing a random number that is both a “nonce” and “truely random” immediately after the date in it’s “Mast head” every day. It is in effect “An immutable public record that is unpredictable” so shoyld not be forgable.

There are various algorithms that you can use to add it to a “Merkle Tree Chain” in a similar way to the “proof ot XXX” in the “Blockchain” and the chain will function as a “signed ledger”.

As for what the interpretation of legislation by a Court Says… I think many here might share my view that it can be both astoundingly capricious and down right inept at times, lacking in logic and with no forethought with regards future consequences and importantly harms (need I say more currently?).

Oh as for,

“Does Anybody Really Know What Time It Is?”

Like the White Rabbit and friends the time can be what ever I decide it is…

This is esspecially true for “elapsed process time” in a multitasking OS with real world interupts and inputs.

As long as there is a reliable way to time it to other times and their standards in both directions it does not matter.

As I keep noting on this blog, time is at best a concept of convenience for human beings, and unless we are both at the same altitude with respect to the earths geoid, your time changes differently to mine…

Experiments have shown two atomic clocks in the same lab when lifted by as little as a foot, measurably run at different rates with respect to each other, with the higher clock “clocking up time” faster than the lower. NIST have “a story” on this,


Oh and that’s all before you start “moving around” which also effects your –very– local time frame refrence with respect to others.

Winter June 29, 2022 12:03 AM


The difference is some kind of “proof of work”

A Blockchain is a signed Merkel tree, ie, each node is signed. The Proof of Work is a consensus algorithm. That is only necessary when there is no trust between anonymous participants.

Btw, Merkel trees are very useful. They are at the heart of Git.

0x77696c6c June 29, 2022 3:01 AM

Respectfully, most of the disagreement in this debate comes from confusing cryptocurrency with blockchain. On both sides, pro and against. The OP also doesn’t make any effort to really distinguish between them, other than in choice of pejoratives.

Clive Robinson June 29, 2022 5:27 AM

@ Winter, Bruce Schneier, Mill, ALL,

A Blockchain is a signed Merkel tree, ie, each node is signed. The Proof of Work is a consensus algorithm. That is only necessary when there is no trust between anonymous participants.

Which is my point a “Blockchain”(1) and a “Merkle Tree Chain”(2),

“Are quantitatively different”

The difference being the “Proof of XXX”.

The “Proof of XXX” is not required for a public ledger or most of everything else that the “Blockchain Fan-Bouis” keep promoting.

If you follow the logic through then clearly,

1, Proof of XXX is not required for Merkle Tree Chains.
2, Merkle Tree Chains are sufficient for most if not all non cryptocoin activities.
3, Merkle Tree Chains are not Blockchains.

Which brings us back to our host @Bruces and several others conclusion,

“Much has been written about blockchains and how they displace, reshape, or eliminate trust. But when you analyze both blockchain and trust, you quickly realize that there is much more hype than value.”

Whilst “Merkle Tree Chains” do have wide utility, low cost, can give high values of trust and immutability, thus do have value, the “Blockchain” has little or no actual utility, and is not low cost all because of the addition of the unneeded “Proof of Work” that creates faux value (the burning of billions of dollar bills to get a tiny but unique pile of ashes analogy).

Blockchain with “Proof of Work” as touted by “Oh so many” is in effect actually a failure.

The essence of “Proof of Work” was to get “hierarchy” replaced by “federation” and as we know it’s a very very very expensive failure in this regards, and exponentially increasingly so.

So the real question I guess is not about what “Merkle Tree Chains” can give us, or even why “Proof of Work” is detrimental in almost every respect but,

How to stop the ‘flimflam’ Hype?”

The answer, starts with removing ambiguity, which gives the flimflamer’s a place to hide their questionable activities.

Maybe we should professionally stop using the term “Blockchain” except to point out it’s,

1, A term beloved by con artists.
2, A deliberate misrepresentation by many to hide the mostly harmfull “Proof of Work” in otherwise mainly usefull Merkel Tree Chains.

Then turn up the heat and let stew…

Winter June 29, 2022 5:45 AM


The difference being the “Proof of XXX”.
The “Proof of XXX” is not required for a public ledger or most of everything else that the “Blockchain Fan-Bouis” keep promoting.

No, the difference is that a blockchain is a Merkel tree with digitally signed nodes. That is all. The Proof of XXX you mention is added to the node as a specific type of checksum.

And if you would look more closely at the Fan-Bois, you would notice that they all agree that “Proof of XXX” is only needed in distributed trust-less networks.

If the blockchain is centralized or if the nodes that add entries are trusted, then their identity is the only thing that is needed. Or maybe you see
Signing == Proof of Identity with Identity = XXX?

c1ue June 29, 2022 7:14 AM

Cryptocurrencies, NFTs and blockchain have no utility – defined as fulfilling or providing any form of superior service.
However, this isn’t the same thing as having no value.
I have long termed bitcoin to be “nerd art”. In this context, a bitcoin is no different than an Andy Warhol – neither have utility but both have value.
NFTs are simply the logical extension of blockchain into art – although they are in the very early stages of separating the wheat from the vastly more common chaff.

And I will have to reverse a bit: blockchain does provide utility: to scammers, grifters and the like. A beautiful vehicle to provide a veneer of “science” and “modernity” to the most obvious and simplistic con jobs.

Clive Robinson June 29, 2022 3:49 PM

@ Winter,

And if you would look more closely at the Fan-Bois, you would notice that they all agree that “Proof of XXX” is only needed in distributed trust-less networks.

All multi- part/user systems require a “root of trust”, it’s unavoidable, otherwise there can be no “trust”. In normal cryptographic systems chat using symetric block ciphers we talk of the “Key” or “KeyMat” as the “root of trust” and ignore for convenience all that goes into not just establishing it but keeping it.

Both privacy and authentication ultimately require such a “root of trust”, if it fails in some way, then they provably fail.

However as I noted to @SpaceLifeForm establishing such a “root of trust” does not have to involve “Proof of Work”. That is a “trusted time stamp service” does not need “Proof of Work” or similar just a reasonable belief[1] of,

1, Impartiality
2, Public record
3, No future predictability

The “Blockchain Proof of Work” was an attempt to do two things,

1, Be Federated not Heirarchical.
2, Create “artificial value”.

It has failed in the first (51% problem amongst others).

As for the second, “value” comes from two things directly,

1, Utility
2, Scarcity

And a third from either of the first,

3, Perception

You can reliably measure and quantify the first two but not the third.

Utility : is fairly simple to describe, it is the increase in “wanted usefulness” in a good. That is you take a raw resource and process it by work into a good of increased usefulness. So take lumps of iron ore and trees and by applying “work” make hammers, knives, chisles, drills, and many machines that are by “force multiplication” in turn capable of “adding utility”.

Scarcity : is also fairly easy to describe upto a point, but falls under the “only three meaningful numbers” notion[2] that is not actually about measurale quantity or scarcity but concepts of numbers, with respect to practical needs.

Perception : is as far as nature is concerned with artificialy polinated tulips the colour of the flower has no value it is incidental to function. It might be black this year, white next, orange the year after and so on it’s predicated on that fickle thing called “fashion” which is supposadly all down to human desires.

I can make different cakes using ingredients with effectively nutritionaly equal ingredients, and the same physical energy and thermal energy inputs so are from the production side equal. But you might prefere “strawberry” and others “blueberry” or “tart” or “gateaux”.

Which you prefere or want in prefrence at any time is “personal taste” that can and usually does constantly change.

For instance, as a normal prefernce I go for dark very high coco solids choclate from certain regions (yes I can taste the difference to a degree, the same as I can with water). However occasionaly I crave realy cheap milk choclate with cheap fruit and nuts in it and very little or no real coco solids or dairy products with the colour and flavour comming from vegtable fats and added caramel (burnt sugar that you can smell on opening the packet).

You might ask “Why?” well the answer is nostalgia a flip back to childhood and when the world was more than half a century different, colours were brighter and a new discovery awaited at nearly every corner. I can no more predict when I’m going to get nostalgia than I can a summer cough/cold (as the stuff keeps and is cheap, keeping a bar or two in the freezer is not realy an issue).

The failing of Blockchain “Proof of Work” is an interesting one and it’s based on a corrupted notion of “Value Added” from “Work” to make not “utility” but “scarcity”.

Yeah, take a moment to think that one through it kind of hurts the brain the first time through for most 😉

But it actually changes neither “utility” or “scarcity” all it realy does is play falsely into “perception”…

The analogy of,

“Document the burn of a billion dollar bills to make a near invisable pile of ashes”

Actually is quite close to the reality of “Proof of Work”.

It is the “perception” of the resulting ashes supported by the “documentation” in which some place value on the “burn” process.

That is they “percieve” destruction as having “value” as long as,

1, It is doccumented.
2, Has no tangible utility.
3, Has artificial scarcity.

Kind of the ultimate “nhilist dream” or nightmare that is faux not real.

That is the end point of the Nietzschean notion of the “crisis of nihilism”. From two central concepts of,

1, The destruction of values
2, The opposition to affirmation of creativity (life).

In effect “A fast race towards the chaotic leveling of all things by entropy”… Thus,

“The journey not the destination”

Chaotic destruction not creativity… in a “bonfire of the vanities” that leaves just a record of the flames… Where everything is the record…

[1] There is no such think as 100% security, likewise technical trust. It is all relative to what is currently known. To see why you have to understand you are not a killer untill you kill, and consequently not a murderer untill seen from others point of view based on knowledge of you killing another person. The same applies to any crime and just about everything else in life hence the old saw about “If a tree falls in a forrest and nobody hears, has it made a sound?” the question is about “future knowledge” not sound waves. Thus “reasonable belief” something is unknown in specifics it’s related to the notion of possession, we know there are small crystals of carbon that we can buy or have bought, we believe they each have unique structure, but unless we possess them we can not measure them, and logically we can not measure them all. But how about large crystals of carbon?…

[2] It has been said on occasions that there are only three meaningful numbers of “Zero, One and Infinity” the third of which actually tells us we are dealing with concepts rather than natural numbers. That is,

Zero = None of something, or something does not exist as a tangible physical object to our knowledge even though we can envision it could exist (think medieval europe and “black swans”).

One = Something unique at one or more levels, which actually describes as far as we are aware every tangible or physical object in our known universe though we can not prove it.

Infinity = An unknown but unimaginably large number of things, we use as a short hand for a countless number of things, such as infinite sands / stars. All of which as they are tangible are we believe finite in this universe… So no infinite variety just change.

AL June 29, 2022 4:29 PM

A Pentagon report finds security issues with the blockchain behind Bitcoin and Ethereum.

Trail of Bits says that it only takes four entities to disrupt Bitcoin and only two to disrupt Ethereum. Additionally, 60% of all Bitcoin traffic moves through just three ISPs. Outdated and unencrypted software and blockchain protocols were also identified …

ViaBTC, a leading global mining pool, assigns the password “123” to its accounts.

Don’t know what they’re thinking. It’s gotta be “abc123”.

lurker June 29, 2022 7:13 PM

@Clive Robinson, re head older than feet

That’s why it is so important to lie horizontal to sleep: so the body can adjust and catch up 😉

429 – keybounce on a touchscreen?

SpaceLifeForm June 29, 2022 7:47 PM

@ AL, EvilKiru, Clive, ALL

That’s quite scary.

Not if you avoided that CryptoCurrency Class with the Bad Professor.

Pay attention to the TLA behind the TLA Yellow Dot Curtain.

Be a good student.

Clive Robinson June 29, 2022 8:38 PM

@ SpaceLifeForm,

Pay attention to the TLA behind the TLA Yellow Dot Curtain.

Did you ever watch Apollo 13?

There is a comment in there supposadly attributed to Fred Haise where he looks out at a cloud of ice crystals that had been in his bladder a few moments before and says,

“The Constellation Urion,”

Every time I hear about those darn printer yellow orion constellation dots, it comes back fresh to mind.

As for the TLA does it stand for “That Load of Ar-souls” 😉

SpaceLifeForm June 30, 2022 12:21 AM

@ Clive, ALL

re: Apollo 13

While I watched the real show in real time, I started to avoid any video productions after that timeframe. Except maybe Sport. There are entire series over many decades that I have never Observed one episode of.

Pardon me while I get up to turn the knob on the the old black and white TV and adjust the aluminum foil on the rabbit ears . . .

It was around 1970 that I realized that TV was a distraction. To keep your brain occupied, to keep you from thinking, to keep you from connecting dots. Today, that is Faux Noise in a nutshell. Or Nuts Hell. You decide.

I have, however, watched Hidden Figures more than once.


I highly recommend you watch this if you get a chance to. Excellent writing, excellent production.

It will tell you a lot about where we are today.

SpaceLifeForm June 30, 2022 3:18 AM

@ lurker

re: 429

Has nothing to do with your HID. It is a Network Heisenbug.

Click back, wait a few minutes (your input should still be in the form box), and then submit again. I can not recall the last time that failed to work.

Clive Robinson June 30, 2022 4:49 AM

@ SpaceLifeForm, ALL,

It was around 1970 that I realized that TV was a distraction. To keep your brain occupied, to keep you from thinking, to keep you from connecting dots.

For me TV time and Film time were “social events where interaction were not required” and I could get some real thinking done without being disturbed by people.

A lady friend who was a little more observant and astute than most once observed I was the only person she knew “who could be truely alone in a party crowd”, and I joked, “hey just learning to sleep on my feet”.

But yes, it’s nolonger a cheap opiate for the masses, but a tax fiddling scam where many are hooked beyond their ability to swim clear.

Funny thing is I do have DVDs and some are “space related” movies, things like “The Dish”, “Gravity”, “The Martian” are in there even the weird and unsettling “Moon”, but for various reasons did not get to see “Source Code”. And yes a lot of SciFi, which is just “mind candy” to play “spot the story arc” amongst other things.

Odd correlation as my health deteriates my watching of DVD’s has increased and my reading of books has decreased a lot. If there is causation in there it does not bode well, so we’ll just jump over that.

But what I’ve realy stopped is “having the radio on”. It used to be that I would have some music radio station on but they have all to my mind become screachy and trite, even the Classical Music stations… Commercialism has become to predominant and invasive and worse it’s quality so desperately low, a “skinny dip in a sanitary tank” looks preferable…

lurker June 30, 2022 3:02 PM

“Click back, wait a few minutes (your input should still be in the form box), and then submit again.”

Yes, I did that, OK. But I did feel a speck of crud on the screen, so was prepared to give upstream the benefit of the doubt. My bad.

Phillip Coffman July 3, 2022 10:41 PM

Cryptocurrency is really based on the Dirac Delta Function. From Wikipedia on 7/3: “whose value is zero everywhere except at zero”

Har Har Har – admit.

Conceivably, there is a universe where you win, with an arbitrarily chosen coin. A zillion ICOs proves it? Not really…

Ralf Schwoebel July 5, 2022 4:05 AM

As a public database with a relatively safe “trustless” approach of updating data, I think IBM did an interesting thing with it: verifying the supply chain with smart contracts ( https://www.ibm.com/blockchain/supply-chain ).

I would also second the notion that anonymous money handling is important in some countries in this world. The Ukraine war is a good example – on both sides. Not all Russians are bad and now the embargo makes them suffer, too. One of our developers sits in St. Petersburg and without the crypto currencies he would be broke. None of the peer-to-peer payments you mentioned are currently working there!

Z-Man July 6, 2022 10:08 AM

From Bruce’s blog post:
But when you remove the insanity and the scams, what’s left?

Similarly a recent Forbes article had this quote (emphasis added)

“Bitcoin is nothing more than a string of digital codes, and its returns mainly come from buying low and selling high,” the Economic Daily newspaper wrote, it was reported by the South China Morning Post. “In the future, once investors’ confidence collapses or when sovereign countries declare bitcoin illegal, it will return to its original value, which is utterly worthless.”

Randy July 6, 2022 10:16 AM

Crypto ‘The Biggest Ponzi Scheme In Human History’—China Blockchain Execs Back Bill Gates And Warren Buffett After Huge Bitcoin Price Crash


The bitcoin price has crashed under the psychological $20,000 per bitcoin level it first crossed in late 2017 before entering a bruising three-year bear market that saw the bitcoin price fall to under $3,000.

Rick Rambough July 6, 2022 10:34 AM

@Ralf Schwoebel
I would also second the notion that anonymous money handling is important in some countries in this world. The Ukraine war is a good example – on both sides. Not all Russians are bad and now the embargo makes them suffer, too.

Solving that does not necessarily require anonymity. Just an alternate channel. Because the Russian government likely will not block incoming money anyway. And Bitcoin is not really anonymous anyway. But actual anonymity, like with Monero, also provides a means for human traffickers, drug smugglers and other criminals to stay in business.

Winter July 6, 2022 12:16 PM

For those who say
Cryptocurrency is no real money like the dollar

Please read the following to see the folly of your ways.

The Never-Ending Fiasco of Fiat Money
Its depredations will last until it finally dies

Gold is not only the ultimate means of payment. It is also a line of defence against the evils of fiat money. As Mr Greenspan so pointedly put it a couple of years ago: “Gold still represents the ultimate form of payment in the world. Fiat money in extremis is accepted by nobody. Gold is always accepted.“

Clive Robinson July 6, 2022 1:38 PM

@ Winter,

The Never-Ending Fiasco of Fiat Money

You and I have had this conversation in the past…

The argument for “fiat money” is usually that it “alows economic growth”. Less well said is it also alows “political manipulation”.

It apparently does not matter what we use to “trade work for goods” it will have disadvantages to one or more people, whilst giving benifit to others.

As I’ve noted before one primary purpose of fiat currencies appears to be politically inspired devaluation.

Which almost always favours the rich at the expense of the poor thus enforcing a substantial under class with a tiny minority over class kept in position by “Guard Labour” paid for usually by the scam of taxation. Where the cost falls on the economic underclass, yet the guard labour benifit is almost entirely devoted to the tiny / scant overclass.

As for “gold” well it falls into one of the two basic classes,

1, Utility
2, Scarcity

I mentioned above, and because of it’s luster and easy ability to work with very fine detail it also falls into that third class derived from either of the two basic classes,

3, Perception

But it is not the only scarce “precious metal” nor are metals particulary scarce, or alone, there are other physical items with scatcity such as jem stones.

Howrver you have to be carefull, at one point aluminium was so scarce it had an inordinately high price, but now appart from the machinations of certain US banks trying to create artificial scarcity thus faux value it is closer to it’s utility value.

Interestingly though is one of the increasingly more scarce metals is iron. The reason is it’s high utility in long life products such as infrastructure, manufacturing and machinery. Depending on who’s figures you believe less than 20% of metal on the market came from mining of ore.

But ultimately physical intrinsic objects are a very poor substitute for what money is realy used for which is to “trade work”.

So which ever way you follow it “sunshine” is the key to our economic growth. The trick is getting and storing that “energy value” in a usefull way.

But watch out for those who will not deal equitably, history tells of the strife “Water Wars” have brought in the past… And judging by the way certain people are buying up water rights and buying retrospective legislation to protect their position there will be neo-water-wars in the very near future as part of switching to a “rent seeking economy”.

I suspect the new “energy scarcity” that has seen a near doubling of prices for energy supply to those at the bottom of the socio economic ladder will continue to go up, and the excess income used to buy up other tangible assets that can earn significant rental income. So doing tripple duty of keeping the poor poor no matter how much the earn, also striping them of ownership of any tangible assets forcing them to rent thus easily being controled or dispossesed, all whilst driving a spiral against societies interest, buy keeping a certain tiny percentage effectively in power.

But don’t,take my word for it, I expect every one to go look for themselves…

Oh don’t forget the point @JonKnowsNothing makes about HIP-RIP, it’s purpose is to give money to a certain tiny majority to buy up the rentable assets of those being killed off by Covid. The way it is being done by the Fed turning on the printing presses is the “friends” get to buy up the assets with what to them is free money, and the rest of society gets laden in debt and have to pay it off six or ten times over in the next thirty years. Obviously to do this, certain services the citizens have paid for all their lives will be stripped away from them to pay off the debt… Oh ans killing od millions as they get to retirment frees up all that pension money to drive the economy round on a false churn…

That is basically the mechanics of “The Money Game” currently…

Jedward July 6, 2022 4:00 PM

Fiasco of fiat money? Isn’t crypto essentially ”fiat” as its value is not based on any intrinsic factors (external utility outside of BTC network, etc). Also for fiasco, cryptos like BTC have lost more of their value than the Russian ruble during last 6 months. It apparently requires a better support system to keep it from sliding toward zero.

If the USD had lost more than half of its value since start of this year like Bitcoin has done, Fox News would be calling for an uprising.

Buggy July 6, 2022 5:12 PM

@David Wood: “2022 is rather underscoring this point, as we’re right now watching the current fiat currency market leader, USD, go up in flames.”

The dollar is currently on fire, but not in a bad way. Look at 1 year returns against any other currency. It’s almost reached parity with the euro. It’s up 17% vs the Sterling in a year.

You can tell me the $ is a mirage also, but it’s clearly not suffering for it. The dollar is a good store of value … Proof? You could convert one unit of your cryptocurrency into dollars and get several units back in a few years.

Winter July 7, 2022 12:44 AM

@Clive, Headward, Buggy

Fiasco of fiat money?

I should remember to add the [Sarcasm /] tag.

All currency is nothing but a symbol, even gold, tobacco [1], or limestone [2]. Using some scarce item, e.g., gold, as a currency leads to deflation in a growing economy which leads to a scarcety of money in circulation that again leads to (much) less growth or even contraction. It also would not lead to price stability [3].

Economy 101 is that moneyprice mirrors products. If that is too dry, read Terry Pratchett *Making Money.

All currencies are social constructs based on trust and force (taxes). Calling one “valueless”, scraps of paper, or “just bits” is posturing because they are all just symbols and symbols are by definition without intrinsic “value”.

People who are against the state, any state, want a currency that is independent, eg, gold, cryptocurrency. People who think a state is a valuable way to organize society want fiat money. Either way, it is a choice of who or what you trust.

[1] ht-tps://www.encyclopedia.com/history/dictionaries-thesauruses-pictures-and-press-releases/tobacco-money

[2] ht-tps://text.npr.org/131934618

[3] ht-tps://gold-standard.procon.org/

Winter July 7, 2022 12:47 AM

Formatting error:

moneyprice mirrors products

Should be

money x price mirrors products

Winter July 7, 2022 1:37 AM

Brain error:

money x price mirrors products

Should be

money = price x products
(should include v for completeness)

Clive Robinson July 7, 2022 2:36 AM

@ Winter,

You know people are thinking it so bite the bullet and answer,

“What pray is ‘v’?”

I’ll go put another “toasting fork on the barbie” just in case we need extra squirm room 😉

Oh and remember although Calamine loation and Pepto-Bismol look similar, they are not the same. The former you slap on, the second you slurp down…

Winter July 7, 2022 4:04 AM


“What pray is ‘v’?”

Equation of exchange
M * V = P * Q

where, for a given period,
* M is the total money supply in circulation on average in an economy.
* V is the velocity of money, that is the average frequency with which a unit of money is spent.
* P is the price level.
* Q is an index of real expenditures (on newly produced goods and services).


Winter July 8, 2022 4:22 AM

On the usefulness of Cryptocurrency Regulations to cement the power of the USA financial industry over other countries. All the buzzwords used to justify USA total dominance over other economies surface again:

US floats framework for international crypto regulations that cement its power
Crypto-land told it can’t disrupt the global economy or financial system

And it’s not just about values. The framework suggests that if America leads discussion of digital assets, especially central bank digital currencies, it will create “opportunities for US companies to lead in the development of these technical systems.”

“Such international work should continue to address the full spectrum of issues and challenges raised by digital assets, including financial stability; consumer and investor protection, and business risks; and money laundering, terrorist financing, proliferation financing, sanctions evasion, and other illicit activities,” the framework states.

Another section warns the current lack of such regulations “challenges the ability of the United States to investigate illicit digital asset transaction flows that frequently jump overseas, as is often the case in ransomware payments and other cybercrime-related money laundering.”

Emphasis mine

MarkH July 10, 2022 4:23 PM

A “Cryptocurrency” Use Case

North Korea’s economy has long been enclosed by a stringent regime of international sanctions.

In the last few years years, the totalitarian state has apparently been able to obtain at least a couple of billion dollars of real money via … “cryptocurrency” (which I will continue to repeat, is not actual currency). For this hermit kingdom’s tiny economy, that’s an extremely useful amount.

It isn’t that North Korea actually uses this Ponzi stuff; they steadily convert it to old-fashioned obsolete untrustable money (China’s national currency, renminbi).

The value of cryptocoin is that it’s much more accessible than real money is, to theft by North Korea’s elite corps of state hackers:


MarkH July 10, 2022 4:30 PM


A great virtue of “cryptocurrency” (we are constantly told) is that it frees its users from having to trust slippery actors like sovereign states and regulated banks.

Unfortunately, it seems that at least the great majority of cryptocoin users are stuck having to repose their trust in “crypto exchanges,” which are (compared to banks and national governments) as solid as the Rock of Gibraltar.

Your mileage may vary … Good Luck!

Jake July 10, 2022 9:25 PM

@Ralf Schwoebel
Not all Russians are bad and now the embargo makes them suffer, too. One of our developers sits in St. Petersburg and without the crypto currencies he would be broke. None of the peer-to-peer payments you mentioned are currently working there!

Then you might want to know that USA is putting pressure on non-russian cryptominers and exchanges working with cryptominers and exchanges running in Russia. This will likely affect your developer unless he finds a completely Russian exchange to convert his crypto to hard cash.

And what does this tell us? Simply that as long as crypto depends on real cash to be “usable”, it will be subservient to government action.

Financial Times wrote about the U.S. request to the Japanese government to sever ties with Russian cryptominers and exchanges

Jake July 10, 2022 9:40 PM

@Jordan Olaffsen
Also, I’m astonished nobody has mentioned the lightning network, Bitcoin’s layer 2. It enables the nation of El Salvador to transact instantaneously, without fees, without electricity consumption.

That highlighted bit is the same kind of nonsense as the fact that cryptominers “return power to the grid during peak times”. Just like there is always a consumption of electricity, especially with crypto and especially with Bitcoin, the mining operations do not “return” anything to the power grid. They merely reduce their mining operations.

But in many European countries people have already been asked to reduce their electricity consumption. It is really time to shut down the power wasting crypto operations as well.

Viktor von Klot-Burton July 12, 2022 9:47 AM

Bitcoin Miners Shut as Texas Power Grid Nears Brink

(Bloomberg) — Nearly all industrial scale Bitcoin miners in Texas have shut off their machines as the companies brace for a heat wave that is expected to push the state’s power grid near its breaking point.

“There are over 1,000 megawatts worth of Bitcoin mining load that responded to ERCOTs conservation request by turning off their machines to conserve energy for the grid.”

While Texas is likely to face more energy shortages in the future, ERCOT expects crypto miners to increase electricity demand by up to six gigawatts by mid-2023, more than enough to power every home in Houston.

In reference to “ERCOT expects crypto miners to increase electricity demand by up to six gigawatts by mid-2023”, anyone can see how a demand increase like that would affect the cost of energy.

The irony is that the mining itself contributes to the greenhouse effect and eventually more frequent heat waves.

Winter July 12, 2022 10:22 AM

@Viktor von Klot-Burton

Bitcoin Miners Shut as Texas Power Grid Nears Brink

From Texas Freeze to Texas Blaze.

What a great way to advertise Free Markets in Power Generation and prove there is no AGW!

But we should remember the Great Words of the former Republican Mayor of Colorado City, Tim Boyd, when he wrote in February 2021:

No one owes you or your family anything; nor is it the local governments responsibility to support you during trying times like this! Sink or swim, it’s your choice! The City and County, along with power providers or any other service owes you NOTHING! I’m sick and tired of people looking for a damn hand out!

If you don’t have electricity you step up and come up with a game plan to keep your family warm and safe. If you have no water you deal with out and think outside of the box to survive and supply water to your family,” the post – which is filled with typos — reportedly continued. “If you were sitting at home in the cold because you have no power and are sitting there waiting for someone to come rescue you because your lazy is direct result of your raising! Only the strong will survive and the weak will perish.


Jake July 13, 2022 11:01 AM


…and prove there is no AGW!

How do you prove there is no AGW (Anthropogenic Global Warming)? Do tell. Or was that sarcasm?

BTW in reference to that former Republican Mayor of Colorado City, Tim Boyd: it is amazing that government representative thinks like that considering that the governments also want people to pay their taxes and obey laws.

Governments have been asking for – demanding- handouts from people either in the form of money or obedience. Even to the point of death, in the form of patriotism.

Billy Jack July 15, 2022 7:28 AM

I’ve never understood the fascination with blockchains. They seem to be a solution in search of a problem rather than the solution to any actual problem.

People talk like any database should be done as a blockchain but I cannot understand the point of it at all. It’s all just a bunch of hand waving and secret chants by people who don’t really understand the facts.

Unless the blockchain is a distributed work in progress, just how would it even work? A central computer building the blockchain would not solve anything.

Chris Drake July 15, 2022 11:22 PM

Cute, but rather than point out the problems, why not propose an alternative that eradicates them all?

I’m certain that a non-blockchain cryptocurrency is possible that makes heavy use of homomorphic techniques (and other modern mathematical/cryptographic advances) to implement a no-fee, abuse-resistant, stable-value, private (including against traffic analysis), difficult-to-lose (even after death), environmentally-friendly solution, which supports simple and fast peer-to-peer payments as well as subscriptions and billing agreements (you know, is real-world useable)… it just needs someone with a bit more math-understanding than myself to fit it all together.

Andre Robatino July 16, 2022 8:00 AM

“Someone, please show me an application where blockchain is essential. That is, a problem that could not have been solved without blockchain that can now be solved with it.”

Here’s an application (“SAMchain”) by Yale researchers. Of course that doesn’t prove it’s a useful application, but there doesn’t appear to be an obvious financial motive. I’d be interested in hearing Schneier’s opinion.


MarkH July 16, 2022 8:46 AM


Thanks for the info!

As with the IBM Food Trust (see above), SAMchain does not use a proof-of-work consensus algorithm.

Therefore, it’s underlying technology is fundamentally distinct from all major “cryptocurrencies.”

As Clive pointed out — and as the SAMchain paper says explicitly — this application is really a Merkle tree. Quite unlike “blockchain” as meant in the shady world of “financial innovation.”

Simply, the Ponzi/MLM applications incorporate proof-of-work; legitimate applications (as far as we’ve yet seen) don’t.

Johnny July 31, 2022 8:51 PM

Namecoin is a good use of blockchain. Essentially, it is DNS on blockchain, with the goal of censorship resistance (and preventing other bad behavior from registrars) while keeping human meaningful names.

There’s also Unstoppable Domains, which is similar.

Maybe there’s a way to gain similar benefits without being tied to a cryptocurrency, but what you get from it is a premade base of machines maintaining the network it uses, and financial incentives for doing so.

In both systems, being tied to a cryptocurrency means that making new domains has a cost associated, which may or may not be a good thing.

Lastly, a similar system could be used to protect end users, by storing their public keys in a public, tamper resistant form.

Chris Drake August 5, 2022 6:44 PM

Hi Bruce,

Since you asked: imagine you’re asked to build a genuinely secure messenger application, leaking near-zero metadata whatsoever to all (nonlocal to the endpoint device) eavesdroppers (i.e. no listeners-on-the-wire can know who you are, or that you’re even saying anything, let alone who to.).  Imagine also that they want payments included.

I’d guess your solution necessarily includes peer-to-peer transport, and since you need to defeat traffic analysis anyway, it probably uses a “mining” solution based on participants passing encrypted traffic (real and/or fake) around on behalf of themselves or others…

Technically, it’s maybe possible to replace the blockchain part with some clever homomorphic technology, but I think the “cryptocurrency” concepts embedded in there still count as “essential” ?

Yes, I’m aware it’s an absolutely horrible idea – bitcoin wastes insane energy, chia wastes insane disk space, we don’t need idiots turning up to waste insane bandwidth, and we definitely don’t need the bad guys having functional communications and payments free of all oversight!


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