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Re: Decentralized Finance: Can It Really Give Us Our Freedom Back?
Replying to legiteum : "I simply don't get DeFi. I have yet to hear a good explanation of it that used specifics instead of some vague hand waving. And most of the projects I've seen that call themselves DeFi are actually... centralized. And as such they are no different than an ordinary financial institution. I don't have a problem with companies trying to innovate in the financial space, and that's a good thing, but calling it "DeFi" sounds like hype to me."
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I get where you're coming from, mpoletiek—haha! Apologies for being another vague hand-waver! But you’re right, there’s a lot of buzzwords in the DeFi space that can make things murky, and not all projects live up to the purist decentralized vision. DeFi is essentially about using blockchain technology to remove traditional intermediaries (and thereby reducing costs substantially, removing inefficiencies, increasing transparency etc). You're also right that many projects marketed as "DeFi" may still have centralized aspects, which makes them feel like just another financial institution. I guess this is the corner we as a community are trying to turn, together.
I believe the key to true decentralization, and thereby more financial inclusion/freedom, rests in the governance structure of any said project. That’s the only tangible way to give more people, more control over their finances and indirectly, their future -- when they have a direct say in the way money works.
While some projects have deviated from this principle, there are some like ShiftCTRL that is dedicated to these core tenets of sound money by leveraging Bitcoin-backed stablecoins and a community-driven governance structure where every member has a say in the framework’s future direction. I do encourage you to check out more about ShiftCTRL and our whitepaper (especially the governance framework) to see how we're moving closer to making decentralized finance a reality: https://www.shiftctrl.money/ Would love to hear more from you about this!
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I get where you're coming from, mpoletiek—haha! Apologies for being another vague hand-waver! But you’re right, there’s a lot of buzzwords in the DeFi space that can make things murky, and not all projects live up to the purist decentralized vision. DeFi is essentially about using blockchain technology to remove traditional intermediaries (and thereby reducing costs substantially, removing inefficiencies, increasing transparency etc). You're also right that many projects marketed as "DeFi" may still have centralized aspects, which makes them feel like just another financial institution. I guess this is the corner we as a community are trying to turn, together.
I believe the key to true decentralization, and thereby more financial inclusion/freedom, rests in the governance structure of any said project. That’s the only tangible way to give more people, more control over their finances and indirectly, their future -- when they have a direct say in the way money works.
While some projects have deviated from this principle, there are some like ShiftCTRL that is dedicated to these core tenets of sound money by leveraging Bitcoin-backed stablecoins and a community-driven governance structure where every member has a say in the framework’s future direction. I do encourage you to check out more about ShiftCTRL and our whitepaper (especially the governance framework) to see how we're moving closer to making decentralized finance a reality: https://www.shiftctrl.money/ Would love to hear more from you about this!
As I see, you are pretty new to the Forum, using replies without quoting
Welcome to the forum!Thanks for going in and telling something new on it (that may or not be useful, further analysis is needed, but, still
), and staying positive. If you want to stay there and get a hold of things (written and non-written), check the materials here:
Newbies - Read before posting
FAQ: Everything you need to know about forum 'activity, account ranks and merit
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Says the account with 0 merit
Someone has supposedly been following this story since Oct 2023.
They're conclusion is this isn't happening: https://x.com/flamincrypto/status/1828832506306797926
They're conclusion is this isn't happening: https://x.com/flamincrypto/status/1828832506306797926
So the only route for bitcoin to become the global p2p network is lightning?
when you realise lightning is a completely different network you then realise that your statement makes no sense
EG
the future of cars is to only ride bikes
there will be subnetworks for small niche utility, but..
when you realise lightning is buggy with issues even LN devs wont/cant fix*, you realise that for small niche subnetwork utility, LN wont be it.. devs will have to start again using a different network model for subnetwork niche utility
(*the more popular LN gets the more issues it will have with liquidity)
So when/how does BTC become a global currency?
Are we saying that was never the goal? Are we saying that it was all a part of the plan to only be a store of value and that people will always use something else for daily transactions at scale?
BTC is still a great option for p2p payments and tx's, especially for cross-border payments and sending money to people on the other side of the world, with just their BTC address. It is true that fees can go high, like it happened when ordinals and runes tx's were filling up the BTC blocks, but things like that can only be temporary. The thing is, we cannot change the way the network is designed, if there is a demand for block space, tx fee is going to go up and miners will prioritize tx's that pay the higher fee.
Fees are only there to help protect the BTC blockchain against transaction spamming. They will increase according to network activity. If the attacker keeps pushing transactions on the Blockchain, fees will rise until they become too expensive for such attacker to continue. People like you and me would need to wait until fees decline to get back in the game. You can always set a low fee when making a transaction. The only downside is that you will have to wait longer for it to go through. It can take from a few hours to a few days.
If you're still in a hurry, you could try switching to an altcoin with lower network congestion. Or you can open a channel on the Lightning Network while on-chain fees are low to take advantage of its benefits. When on-chain fees rise, you won't be affected because you'll have BTC "parked" in the LN. Fees will stay dirt-cheap, while transactions will confirm almost instantly. A pity that Mike Hearn missed out all of the fun. Bitcoin is doing well without him. I wonder who will leave the development team next? Will it be Luke Dash Jr. (a staunch Ordinals critic)? Only time will tell.
So the only route for bitcoin to become the global p2p network is lightning?
Wait... so when demand for blockspace goes up, fees go up is a part of the design. I get that.
But so high that it can't scale to support a global p2p economy?
BTC is still a great option for p2p payments and tx's, especially for cross-border payments and sending money to people on the other side of the world, with just their BTC address. It is true that fees can go high, like it happened when ordinals and runes tx's were filling up the BTC blocks, but things like that can only be temporary. The thing is, we cannot change the way the network is designed, if there is a demand for block space, tx fee is going to go up and miners will prioritize tx's that pay the higher fee.But so high that it can't scale to support a global p2p economy?
It was temporary because it couldn't continue. The demand couldn't handle the cost.
So how does this scale again?
Ultimately money is your own. If I worked for it, I should be able to do whatever I want with it.
Exactly, you can spend or save as you want. If someone needs to save they can use fiat or bitcoin, the latter would obviously be better but situations are not same in every country to allow the latter.We are still far from a bitcoin-only economy and even if we see a fait-bitcoin hybrid economy, people will continue spending that they usually do. Because these habits of buying useless things or buying less necessary items has stemmed since an ancient time.
As bitcoin usage increases, merchants will adapt themselves to use it and then it will be worth watching.
So we're going to mint all the BTC and then what? Use LN?
Are we ignoring the fact that fees can go up at any time?
Doesn't this signal that the protocol isn't as resilient as we need it to be for a global p2p economy?
Doesn't this signal that the protocol isn't as resilient as we need it to be for a global p2p economy?
That's what makes it resilient. Only shitcoins promise to have cheap fees at all times and they invariably collapse the moment they encounter a hint of congestion and suddenly fail to deliver on that promise. Dynamic fees are a necessity. You might not like it, but it's how it has to be.
Wait... so when demand for blockspace goes up, fees go up is a part of the design. I get that.
But so high that it can't scale to support a global p2p economy?
Anyone seen this?
https://www.youtube.com/watch?v=SlPgee7dpO0&feature=youtu.be
This is some pretty good analysis in my opinion.
https://www.youtube.com/watch?v=SlPgee7dpO0&feature=youtu.be
This is some pretty good analysis in my opinion.
This might be an ill-informed question, but I came across this recently and was wondering how we feel about BTC upgrades/improvements?
It feels like BTC is now chasing fiat gains over building a global p2p economy, hoping that lightning network or some other L2 solves the scaling problems for non-custodial transactions.
https://blog.plan99.net/the-resolution-of-the-bitcoin-experiment-dabb30201f7
It feels like BTC is now chasing fiat gains over building a global p2p economy, hoping that lightning network or some other L2 solves the scaling problems for non-custodial transactions.
https://blog.plan99.net/the-resolution-of-the-bitcoin-experiment-dabb30201f7
Mike Hearn was always slightly "out of kilter" in terms of their views about how Bitcoin should work. Some of it didn't really fit with the underlying ethos. I'd take anything said in that blog with a healthy amount of skepticism. It's their vision that failed (and rightly so).
And it's simple-minded speculators who are chasing fiat gains. Just because they're loud and numerous, doesn't mean they're representive of the community as a whole.
I think this is the issue... How hard is it for the core devs to come together and agree on a BIP that defines the purpose of bitcoin.
Bitcoin is either digital gold or it's here to replace fiat. The narrative seems to bounce between the two and while I think it's solved digital gold, the people who wanted to replace fiat are left wanting. Meanwhile the culture seems to have literally forced them out to go build their own solutions.
As I understand it BTC doesn't have the bandwidth required to use it as money (TPS). Therefore, something else is needed to make this possible?
Either by upgrading BTC or building something "like" lightning network?
Is it a proper critique of lightning network that it's not simple enough for most people to use it as money in a non-custodial way?
Either by upgrading BTC or building something "like" lightning network?
Is it a proper critique of lightning network that it's not simple enough for most people to use it as money in a non-custodial way?
Bitcoin is money already. Unfortunately, however, it may not be the everyday money that people imagine. It could be a money for final settlement though. If it can't be used to buy a cup of coffee, a sachet of toothpaste, a packet of salt, or a piece of banana at the convenience store next door, then it can only be a limited form of money. It is money nonetheless.
We've been advised to keep our coins in cold wallets but it is also widely acceptable to keep small amounts in hot custodial wallets for small transactions every once in a while. This same approach could be employed in the use of on-chain and off-chain networks in payments.
The Lightning Network I'm afraid isn't only not simple for the common folks, it might be flawed also.
I think Bitcoin is still missing the "Acceptable" property of money. Mostly due to slow TPS and volatility. LN's complexity forced most TX's to go custodial so while it works... kinda missed it's intended use-case no?
Isn't she currently serving?
Can't she pursue this now?
Is this the first policy point we've seen from her?
Isn't it funny she's copying Trump?
Can't she pursue this now?
Is this the first policy point we've seen from her?
Isn't it funny she's copying Trump?
Re: Are you still excited about Bitcoin or has it reached its pinnacle?
The one thing that's a bit disappointing, but understandable as human nature, is Bitcoin Core's drama.
When I think about massively adopted open source projects (Linux, Apache, ect) there's a lot of stories to recall that are full of drama, but in the end the important projects continue to evolve. The software is updated, maintainers rotate in, and features demanded by users are developed and released. Projects that fail to do this die and are replaced by better teams and better software that continue to see adoption. A great example is OpenSSL when a critical vulnerability forced engineers from all over the world to make a concerted effort to resolve the issues and facilitate better governance going forward.
There's always a feature or two that cause a debate over the purpose and scope of a project, but if a feature is truly needed it's developed and when it's developed outside the core project the developers are supportive and collaborative in the work and one project promotes the other within the community.
Considering all of this, when I read on the history of Bitcoin Core, the culture feels toxic. When you tell people that the goal is to create a state-less money and then insult individuals who try to enable this use-case by improving TPS while maintaining fundamental innovations (non-custodial ownership) you can expect them to leave and create their own implementation. When adoption continues on alternative chains and additional innovations discovered (smart contracts) that further the goals of BTC (global p2p economy without middlemen) you'd expect bitcoiners to celebrate and work to implement something similar, but this hasn't been the case. Instead, we see the community double down on their toxic rhetoric.
I fear we're seeing poor human nature rear it's head and guide BTC, enabling continued religious zeal around a rhetoric that prevents continued innovation and change. This nature is fed by fiat gains in the original project which is novel among open source projects. When your original release isn't continuing to pay dividends it's a lot easier to keep an open mind about innovation and progress.
The development and adoption of Lightning Network reminds me more of critical proprietary software that's seen mass adoption, but fails to receive continued support. The community or corporation that picks up the ball is forced to bolt on an overly complex solution in order to remain relevant in a space where the user's expectation has evolved.
Just a thought.
When I think about massively adopted open source projects (Linux, Apache, ect) there's a lot of stories to recall that are full of drama, but in the end the important projects continue to evolve. The software is updated, maintainers rotate in, and features demanded by users are developed and released. Projects that fail to do this die and are replaced by better teams and better software that continue to see adoption. A great example is OpenSSL when a critical vulnerability forced engineers from all over the world to make a concerted effort to resolve the issues and facilitate better governance going forward.
There's always a feature or two that cause a debate over the purpose and scope of a project, but if a feature is truly needed it's developed and when it's developed outside the core project the developers are supportive and collaborative in the work and one project promotes the other within the community.
Considering all of this, when I read on the history of Bitcoin Core, the culture feels toxic. When you tell people that the goal is to create a state-less money and then insult individuals who try to enable this use-case by improving TPS while maintaining fundamental innovations (non-custodial ownership) you can expect them to leave and create their own implementation. When adoption continues on alternative chains and additional innovations discovered (smart contracts) that further the goals of BTC (global p2p economy without middlemen) you'd expect bitcoiners to celebrate and work to implement something similar, but this hasn't been the case. Instead, we see the community double down on their toxic rhetoric.
I fear we're seeing poor human nature rear it's head and guide BTC, enabling continued religious zeal around a rhetoric that prevents continued innovation and change. This nature is fed by fiat gains in the original project which is novel among open source projects. When your original release isn't continuing to pay dividends it's a lot easier to keep an open mind about innovation and progress.
The development and adoption of Lightning Network reminds me more of critical proprietary software that's seen mass adoption, but fails to receive continued support. The community or corporation that picks up the ball is forced to bolt on an overly complex solution in order to remain relevant in a space where the user's expectation has evolved.
Just a thought.
As I understand it BTC doesn't have the bandwidth required to use it as money (TPS). Therefore, something else is needed to make this possible?
Either by upgrading BTC or building something "like" lightning network?
Is it a proper critique of lightning network that it's not simple enough for most people to use it as money in a non-custodial way?
Either by upgrading BTC or building something "like" lightning network?
Is it a proper critique of lightning network that it's not simple enough for most people to use it as money in a non-custodial way?
When the BTC protocol doesn't change to enable tx's for the masses people will create things like Lightning Network.
I don't see this as a bad thing. Ideally BTC can evolve, but I don't see evidence that it's willing to do that. Obviously it will take time, but I'm afraid it's currently not governed in a healthy way.
Concerning Lightning, it seems like it was a good idea, but technically complex so most people end up using custodial solutions or products like Phoenix, which is centralized infrastructure.
Is there light at the end of this tunnel?
I don't see this as a bad thing. Ideally BTC can evolve, but I don't see evidence that it's willing to do that. Obviously it will take time, but I'm afraid it's currently not governed in a healthy way.
Concerning Lightning, it seems like it was a good idea, but technically complex so most people end up using custodial solutions or products like Phoenix, which is centralized infrastructure.
Is there light at the end of this tunnel?