Comment on MIT Students Stole $25 Million In Seconds By Exploiting ETH Blockchain Bug, DOJ Says
qwerty@discuss.tchncs.de 6 months agoScammers have been doing that with cash, PayPal, gift cards and even regular bank transfers that are supposedly so safe.
Crypto transactions being irreversible are no different than cash or gold transactions, you can’t magically revert giving someone cash once you realize they scammed you. Only thing you can do is report it to the police. Crypto works the same way, but for transparent coins like btc, or eth you at least have a proof that a transaction took place unlike cash.
Ibaudia@lemmy.world 6 months ago
Yes, exactly my point. It’s way harder to scam with physical stores of value like cash, because there aren’t layers of obfuscation like there can be with digital stores of value. That is why scamming is so much less common in meatspace compared to crypto, where every single interaction, even with a vendor or exchange, is a potential landmine you have to be cognizant of.
With PayPal or bank transactions, those can be reversed and there are regulatory bodies to ensure consumer protections. Even with physical stores like cash, it is much easier to track someone and prosecute for illegal activity since they can’t hide behind crypto wallets.
Every store of value has some form consumer protections and systems of accountability except for crypto, and as such scammers are empowered by it.
qwerty@discuss.tchncs.de 6 months ago
How is it harder to scam with cash? You come to my store to buy something, you hand me the bill, I take it and don’t give you anything in return. Even if you call the police it’s my word against yours, how will you prove that I took your money?
Most scams are done irl with FIAT (fake bills, overpriced cooking pots, fake tech support, palm reading, IRS google play cards, nigerian princes, fake e-bay items, fake charge-backs for real e-bay items, uber ride cancels, uncancellable memberships, hidden costs…) at the end of the day you can’t protect everyone from everything, especially from their own gullibility. The design of crypto, when used properly, prevents all of the non-gullibility based scam types (chargebacks, cancels, hidden costs, automatic deductions etc.). For some people complete control over their money is a plus and some prefere to have it handled by banks and governments, maybe crypto just wasn’t made for the latter.
Ibaudia@lemmy.world 6 months ago
Video cameras. Also the shopkeep develops a reputation and is easily identifiable.
Technically the truth, but a MUCH larger percentage of the crypto ecosystem is devoted to scams. I don’t think that is just “growing pains”, the design of crypto, again, incentivizes this behavior because it gives victims no recourse.
Yes, but gullibility is the #1 problem and again, crypto has no safeguards or recourse.
Control but only within the system and ruleset that is made by those who control the chain. If institutions leverage their power in the space in a mass-adoption scenario, then they will be the ones making these rules and controlling what you can do, and the rigidity of crypto’s rules advantage them in that case, no the consumer.
qwerty@discuss.tchncs.de 6 months ago
I don’t have cameras in my store and i doubt you walk around with a gopro strapt to your forehead. Crypto stores develop reputation as well.
On what are you basing the opinion that MUCH larger percentage of the crypto ecosystem is devoted to scams? Legal action is the only recourse you have with cash, the same can be done with crypto. If design of crypto incentives scams then so does the design of cash.
Neither does cash, gift cards and all of the methods Nigerian princes and certified Microsoft technicians from IRS have been successfully using for years to scam their victims.
The whole point of making the system decentralized is so that a powerful actor can’t seize control over it. There are hundreds of chains with different rules and regulations, you can chose the one that fits your needs, and if a powerful actor tries to change it’s rules the community can decide that the version of the chain with altered rules isn’t one they want to take part in and split off. It has happened before with block size wars that resulted in btc/bch split. Both chains run fine to this day, each with their own rules decided by their own community.
rudyharrelson@kbin.social 6 months ago
I'm curious if you would prefer crypto disappear entirely, or if you would prefer it be properly regulated so it has all the same, or greater, protections so that it can be part of the economy without being as risky for consumers.
I can only assume the early internet had little to no consumer protections on purchases (compared to the protections they have today, that is), but I could be wrong on that. Laws and regulations tend to always lag behind technology.
I like the idea of taking power away from big banks. Crypto is no silver bullet, but I'd like to think it could get there one day. But since capitalism always protects itself, I doubt any wealthy lobbies are going to be asking congress to pass common sense regulation for a currency that takes power away from institutional banks.
Ibaudia@lemmy.world 6 months ago
I would prefer for crypto to be gone. Based on my understanding of blockchain, I don’t see how it can be used as currency ever. Blockchains can be extremely useful, just not as currency.
The only thing you can really do about stolen tokens is have some authority de-list them and re-issue new token to the victim. That’s hardly a solution. It also extremely centralizes control, which runs antithetical to the purported benefits of crypto.
Crypto also doesn’t take power away from institutions. If institutions were to leverage their power in the space, they would become just as, if not more powerful than they are currently, assuming a mass-adoption scenario. The inflexibility of crypto always works to the advantage of those setting the rules.
Crypto is also incredibly power inefficient. Even with proof-of-stake instead of proof-of-work, it is still factors less efficient than normal FIAT transactions, and as of yet I see no solution to that. One may pop up in some hypothetical future, but I have no faith in that.
Additionally, crypto will also always reward those who engage with it disingenuously, as it is not linked to one’s real identity and, again, is inflexible and impossible to truly regulate. In a mass-adoption scenario, scammers would become enormously more successful.
Most importantly, crypto is a digital asset whose store of value is implicitly tied to the belief that it can be sold for FIAT. It is almost exclusively a speculative vehicle, and always had been since its inception. Actual crypto purchases are disincentivized by how slow, inefficient, unwieldy, and volatile it is. Not to mention high transaction fees for the most popular coins. It is also deflationary, meaning one is disincentivized from spending it, which is extremely bad for the economy in a mass-adoption scenario. Gentle inflation is one of the core principles underpinning our economy. Having currency also be an asset that appreciates in value is objectively a bad thing.
I feel like I could keep going for a while but hopefully you at least understand why I feel this way now lol.
rudyharrelson@kbin.social 6 months ago
Hm, my understanding was that blockchain was the technology that handles the distributed ledger rather than the currency itself. Blockchain seems useful to a point in this realm, but is, like we both know, extremely energy inefficient and unsustainable.
No arguments here. Though I think there could be better solutions out aside from using some centralized authority to delist stolen tokens. Blacklisting certain wallet IDs could be a crowd-sourced project, much like how blocklists for adblockers are largely community-driven.
Gotta disagree with "crypto doesn't take power away from institutions". Exactly as you said, if institutions leverage their pre-existing power in the crypto space, it becomes centralized because a small pool of wealthy players control the majority of the currency. The currency itself is not centralized, but it can be exploited by bad actors who wish to manipulate its value (or just profit off of it, either way). If existing institutions weren't using their massively accumulated wealth to affect the crypto space, they would be losing power over the people who decided to avail themselves of it and bypass conventional banks. I consider this a weakness in cryptocurrency that needs to be addressed, but is this weakness any different from any other currency?
Zero arguments from me. It's an environmental disaster.
Depends on how you intereact with crypto. In the US, most states require crypto brokers to verify the identity of those trading on their platforms. No different from opening a checking account with a bank. Sure, one could get into crypto anonymously but it's considerably harder. Some crypto ATMs exist, but I think virtually all of them have cameras and require you to show photo ID to use them (at least in the US).
I disagree that it's been a speculative vehicle since its inception. It's undeniably a speculative investment now, and has been for years, but when it first started out, it was basically worthless and adopted by a handful of businesses who were understandably pissed off after the 2008 market crash. People naturally speculated as to whether or not it would take off, and I think it's unfortunate that it became a speculative investment by those who weren't really interested in its use as a currency.
I'm no economist, but I don't see much difference between "crypto's value is implicitly tied to the belief that it can be sold for FIAT" and "FIAT's value is implicitly tied to the belief that the issuing government values it"
Oh believe me, none of this is news to me. I just wanted to see what you thought. I've found the cryptocurrency conversation interesting as the years have passed and enjoy asking people for their thoughts when they appear to be engaging in good faith. Most people I see are very unpleasantly hardline for or against crypto and don't care to take time to discuss any of the nuance.