The real question here is not whether one can design a market that prevents bad behavior, but whether any of the major players will ever bother using it. If the “little guy” is always on the losing end of market shenanigans, then market makers will never have an incentive to move their liquidity to the “fair” market.
The "little guy" is always at a disadvantage in capitalism (or small business, or mom & pop shop)
I suspect there's a disconnect between people talking about democratization of access, and people pointing out crypto doesn't actually make things fair.
Crypto doesn't make things fair for the little guy.
It does add additional transparency to financial markets though, as well as things like open, verifiable, non-custodial, programmable financial contracts (as long as all the inputs can be verified reliably on-chain)
This gives people equal access (with some limitations on what that means)
>It does add additional transparency to financial markets though
No, not really. This comment is more crypto myth-building. There's nothing technical about blockchains that adds transparency. Any company that wants to publish all its financial statements publicly can technically already do so and could always do so. They don't for many reasons, the most important ones being that customers overwhelmingly want financial privacy, and financial companies are required by law to provide a certain level of privacy for customers.
No, smart contracts are technically not "contracts" in the legal sense and are also not "non-custodial" because they require middlemen to run the blockchain. There is also nothing more open or verifiable about smart contracts compared to any other program. They're just programs. I absolutely hate that they used the name "smart contract" for this because it's so misleading.
>as long as all the inputs can be verified reliably on-chain
This will never happen because the only reason they're useful is because they take inputs from off the chain. The marketing is that users will be able to actually use these things to perform services. Of course that is self-contradictory because of the previous reason.
>This gives people equal access
No it doesn't, because only a small fraction of people are going to become smart contract programmers or are going to become skilled in auditing smart contracts. You might as well say all finance gives people equal access because anyone can become a CPA.
1. Saying that transparency isn’t desired does not refuse his point. Not only that but the off topic declaration where you imply privacy is impossible on blockchain is incorrect.
2. Miners and block verifiers are not middle men. They have negligible control where as a middle man has full control.
3. The verifiably of smart contracts is not exceptional for its own sake, but for the fact that it prevents cheating in a system where cheating is heavily incentivized.
4. Auditing smart contracts will generally be much easier than auditing EVM bytecode. Ethereum isn’t the only game in town and the most sophisticated layer 1 smart contract languages converge toward functional, locked down languages which lend themselves to automated and manual auditing. The same way open source increases user security even though 99% percent of users won’t build or read its code.
You are so off base on all of your point I seriously doubt you don’t have an emotional stake in your position. Perhaps the classic “I’m a smart tech person yet I missed out, so really it’s always been bad and I’ll be proven right someday,” syndrome. You know other people that missed out simply developed some grace, and others still that identified problems went to work on them rather than pretending they were unsolvable.
The dogmatic crypto skeptic is as bad as the crypto shill.
>Saying that transparency isn’t desired does not refuse his point.
That's not what I was saying, at all.
>Not only that but the off topic declaration where you imply privacy is impossible on blockchain is incorrect.
Please do not argue straw men. I never implied privacy is impossible. I know about things like privacycoins. Some have even been mentioned in this comment chain. My actual implication here is that blockchains cannot promise either privacy or transparency. Those who want to use mixers and privacycoins will do so and you won't have any transparency into their activities. Those who want to insist you use KYC exchanges and traceable coins will do so and you won't be able to have privacy there if you want to transact with them. So basically, an ordinary person has no control over how much transparency or privacy there actually is on the network. Unless you have an outsized level of control on the network (and therefore the network is not decentralized) then you're completely dependent on the other more powerful party. So basically blockchains are providing nothing of value here compared to an ordinary financial service.
>2. Miners and block verifiers are not middle men. They have negligible control where as a middle man has full control.
No, they have full control. Like actual full control over the network. Individually they don't, but as a whole they do, that's literally how the network functions.
>3. The verifiably of smart contracts is not exceptional for its own sake, but for the fact that it prevents cheating in a system where cheating is heavily incentivized.
No, this is wrong. Verifying a smart contract does not prevent cheating. Even if you verify that the smart contract technically has no bugs, it could still do the wrong thing, or the other party could just commit good old-fashioned normal fraud and never hold up their end of the bargain. Smart contracts are not actually smart not are they contracts.
>4. Auditing smart contracts will generally be much easier than auditing EVM bytecode. Ethereum isn’t the only game in town and the most sophisticated layer 1 smart contract languages converge toward functional, locked down languages which lend themselves to automated and manual auditing. The same way open source increases user security even though 99% percent of users won’t build or read its code.
This whole paragraph is based on a falsehood. Open source does not increase user security, go look at the recent log4j disaster. What actually increases security is having security engineers being paid to look for and fix security issues, the cost of which is not significantly different between open or closed source. I have seen no reason to believe it's any different in smart contracts. Functional languages can be good for proving certain types of code with fixed requirement, but the same thing also applies to any of that category of software, financial or otherwise. It's again not related to blockchains at all.
>I seriously doubt you don’t have an emotional stake in your position. Perhaps the classic “I’m a smart tech person yet I missed out, so really it’s always been bad and I’ll be proven right someday,” syndrome.
This is a totally wrong, nonsensical and completely rude comment, please never say anything like this again. Never even let the words cross your mind. Your intelligence is capable of much better things.
>and others still that identified problems went to work on them rather than pretending they were unsolvable
This also makes no sense. I've been looking at this for 10 years. The problems aren't unsolvable. There are plenty of problems to solve, the reason why you shouldn't bother solving them is because all of those problems are intentionally caused by the bad design of blockchains. Our work is hard enough without purposefully making it harder, but that's the only thing blockchains do.
>The dogmatic crypto skeptic is as bad as the crypto shill.
I'm not a "crypto skeptic" and I don't care to discuss dogma. This is about the facts. Please avoid making these ridiculous accusations, please stop trying to psychoanalyze me, and just stick to the facts. That will help both of us.
> There's nothing technical about blockchains that adds transparency
False. On a public chain like Ethereum, every single historical operation and its outcome events and state can be traced and verified. If the source code is published, the running bytecode can be verified to match the source code.
> smart contracts are [...] not "non-custodial" because they require middlemen to run the blockchain
Also false - miners/validators have no opportunity to seize or freeze assets
> There is also nothing more open or verifiable about smart contracts compared to any other program
See above. You can verify what code was running when and with what input.
>False. On a public chain like Ethereum, every single historical operation and its outcome events and state can be traced and verified. If the source code is published, the running bytecode can be verified to match the source code.
No it's not false. Ethereum doesn't matter, there are a ton of sidechains and mixers that obfuscate transactions and you can't stop people from using them, you also can't guarantee they will provide source code or provide any means to verify their own smart contracts which they don't have to build on top of Ethereum's platform. And many of them don't anyway, specifically because of deficiencies in Ethereum.
>Also false - miners/validators have no opportunity to seize or freeze assets
Actually they do, if they all decide they don't like you then they can blacklist your wallet address. For practical purposes it's the same as a frozen asset. The inability to seize assets is actually a bad thing because it means the network operators have no effective way to confiscate stolen money.
>See above. You can verify what code was running when and with what input.
And you can also do that with literally any other program regardless of whether it's on a blockchain or not.
Right... why do you think the perpetrators or ransomware attacks demand to be paid in crypto-currency, instead of via a plain old wire transfer which according to you is more opaque?
For one, accounts on it are pseudonymous. If by "transparency", you mean "every activity can be traced back to a meatspace individual or institution as recognized by a national government and/or law enforcement", that is a different level of "transparency".
It's not being compared to wire transfers but to server-side software (including those responsible for executing legacy wire transfers).
Because it's still less tracesble than a bank account, but unless one converts it in a dex to something truly untraceablr like monero or zcash, ones attempts to transact with it will be traced, so you won't be able to do much else with it. Coinbase and all other exchanges are known to freeze coins linked to illegal activity.
'Any company that wants to publish all its financial statements publicly can technically already do so and could always do so.'
What, in PDF? and store them on a website or FTP server? Totally discoverable and analysable?
And if two different companies publish statements (inevitsbly in slightly dofferent formats) you need a team of analysts working for 6 months to match up the transactions?
