Cryptocurrencies are provably inferior when you don’t require censorship resistance.
- Any volatile cryptocurrency transaction for real-world payments requires two currency conversion steps
- Any stable cryptocurrency requires any entity to convert dollars to tokens and vice versa at par
Blockchain “security” guarantees are horribly inefficient and overrated
- A “private blockchain” is trivial to implement append-only log: just cryptographically sign a hash claim
- “Publick blockchains” protected by proof-of-whatever promise a “no central authorities” & “fully distributed trust” append-only data structure. This is a lie.
- Any lottery-based reward creates mining pools
- The code developers also can do act as central authorities
- And protection is limited to the amount of money wasted
Limited capacity fee death spirals: Fun for the whole family…
- If the number of transaction < capacity, the transactions may be cheap, including cheap for spammers who want to occupy space forever
- If the number of transaction > capacity, fee auction death spiral starts, where the price/transaction goes from $0-$30+.
- Either option is exploitable by a moderately-funded adversary
Eulogy made by Nicholas Weaver