for those assets, what are the advantages of decentralization?
Lots of advantages in reliability and assurances. More fundamentally it obsoletes some functions of auditing and government along with the associated costs to society.
It automates many of the administrivia of corporation management.
If you have ever run a public company, the advantages are more immediately apparent.
the pt that i was getting at is that until Bitcoin fulfills Satoshi's visions as a generally accepted and large enough form of
currency or money, there will be no such trust or confidence given by the masses or larger financial institutions to embed asset derivatives into the blockchain as the "legal" ledger.
what will drive Bitcoins growth is a maintenance of its Sound Money function along with transactional growth which we are fortunately beginning to see w/o a doubt. once it becomes a generally accepted global and apolitical public good as money, then it might be used to embed more riskier assets within the blockchain as with CP.
otoh, the blockchain may only ever be applicable to Bitcoin as Money. in which case, all those speculative assets may just be bought and sold with BTC as they will become denominated as such with the records continuing to be maintained by those organizations responsible for enforcing those contracts.
if we use Bitcoin to win the Money Game, we win Everything. that is where the problem lies.
Yes Yes...
This is why I would like to see SPV side chains implemented on some altcoins.
In matters such as these, it is not as important to see how things work, as it is to see how they fail and under what circumstances.
i would prefer NOT to see the spvp implemented, period, for all the reasons i've already made ad nauseum. let them experiment on federated servers.
i'm not even sure how you'd bring an altcoin into a SC with spvp since the monetary properties of such altcoins are usually so divergent and non-sensical to most Bitcoiners it wouldn't be worth anyone's time or effort.
I'm quite sure NL was referring to a SPV proof trial test on an altcoin before merging it into Bitcoin.
By the time such a trial test had enough time to prove out the various risks of having a multitude of side chains offering new functionality below an established coin, you might just find that usage and gravity inadvertently shifted to that altcoin over bitcoin. I still believe alts are the highest potential threat to the whole experiment. Network effects and the economic need for interoperability between users have successfully kept alt coins at bay so far, but if SC's prove successful network effects might just shift to the tested altcoin.
The get rich quick crowd will pump and dump these experimental coins from the alt coin. Nothing more. They would be the ones jumping on them from Bitcoin as well. The waters will be muddied either way, it might as well be the altcoins. The network effect would still prefer the stability of Bitcoin over smaller forks. Besides, the side chains are about counterparty risk, so they are unlikely to even be accepted until Bitcoin itself gains wider acceptance. Let ApplePay experiment with SC technology, it could be their chance to break into crypto.
If investment and network effects shift to the alt than this would also be a highly informative and interesting result. If the proposal is meritorious, the VC's would do better financially with an alt anyhow, if we are looking at ROI. A 1$MM buy in on an alt goes a long way.
(So much free advice for them!)
We just don't know how it would play out, that's the point. We have plenty of time to do it later if all the evidence shows that there is no unmanaged risks.
I'd rather get rich slowly rather than quick anyhow. When we have the opportunity to change everything for posterity, why sell out for a few cookies?
That's the problem with tail risks. How do you know what is a "long enough time?"
This is why the catastrophic failure issue suggests there shouldn't really be one coin after all, and trying to maximize "network effect" may be over-fitting. Monoculture is fragile.
By that I meant long enough to see some of the tail risks manifest, and to see the recovery from it (if it does). We identified some pernicious ones already.
There is a lot of talk about what "will" happen, but if we are honest with ourselves, we don't know what will happen.