Yes, I know that it still exist, and yes, decentralized currency which utilizes distributed, cryptographic validation is not actually a strictly bad idea, but…
Is the speculative investment scam, which crypto substantially represented, finally dead? Can we go back to buying gold bars and Pokemon cards?
I feel like it is, but I’m having a hard time putting my finger on why it lost its sheen. Maybe crypto scammers moved on to selling LLM “prompts?” Maybe the rug just got pulled enough times that everyone lost trust.
Technology rarely advances for reasons that benefit the majority. It advances to make a few people rich, kill people very efficiently, or to increase profit margins on porn sales (see item 1, I guess).
If you think about the really good applications of things like crypto, NFTs, blockchain, etc., you quickly realize that they are things that aren’t marketable or profitable for the entities that would need to implement them. If all the banks and credit companies bought into something like blockchain or NFTs, then transaction fraud and identity theft would disappear overnight… but what would THEY get out of it? The only way it’s ever going to happen is with coordinated government mandates, and nobody running for office has the faintest idea of what crypto tech is other than “dumb way for the nouveau riche to waste their money”
I don’t think transaction fraud or identity theft would disappear overnight, they would just take on different forms.
I think a big part of why cryptocurrencies don’t take off as actual currencies (beyond speculative investors ruining everything), is the fact that there are a lot of clear benefits to a centralized system that blockchains have yet to adequately replace.
1: Scale. The amount of processing power it would require for all McDonald’s global credit card transactions on a blockchain is many orders of magnitude greater than that of using Visa or Mastercard. Even when you account for proof-of-stake coins like Ethereum. Maintaining a single large centralized database will always be more energy efficient than maintaining many large decentralized databases, especially when the latter comes wrapped in a dozen layers of cryptography.
2: Reversibility. If I buy something from a stranger on the internet and use my debit or credit card, my bank can issue a chargeback if said stranger tries to screw me over. This is fundamentally impossible on a blockchain without relying on some kind of middleman to hold funds in escrow, at which point you’re basically back to using big centralized banks to do all the heavy lifting. Sellers may view this as a positive aspect of using a blockchain, but they can’t realistically force buyers to use a payment processor more amenable to their desires. If they could, PayPal would have vanished years ago.
On top of that, one of the big problems that blockchain solves can be solved through centralized systems as well. The big one that people bring up is credit card fraud, but what a lot of people don’t realize is that credit card fraud is a lot less common outside the US than within. This is because places like the EU have mandated security measures such as chip-and-pin (the US only requires the chip part). Smartphone-based contactless payment systems like Apple Pay also provide effective 2-factor authentication at the point of sale. And while blockchain is theoretically more secure, in practice these mechanisms are “good enough” for everyday use.
How does crypto stop identity theft or transaction fraud? Crypto does nothing for credit, which is basically what identity theft is, and if you’re missing how widely there’s transaction fraud on crypto you haven’t been paying attention.
It’s not the cryptocurrency itself that prevents fraud, it’s the surrounding technologies such as blockchains and NFTs.
Using NFT to own the address to a PNG is hilariously stupid and worthless, but what it’s actually great for is receipts. If I buy a donut and get an NFT proving that I now own the donut (along with metadata about where and when I purchased the donut) and months later I am on trial for murder, I can prove to the court with absolute mathematical certainty that I couldn’t have killed anyone at that time because I was eating a donut halfway across town.
Using blockchain similarly is great for proving your transaction history. Maybe I somehow faked that NFT about the donut? Well, I couldn’t have, because it was months ago and blockchain history is cryptographically impossible to spoof.
These are obviously contrived examples, but when applied at scale it becomes an extremely powerful way to verify truth. Yes, I did in fact buy those tickets, here’s my NFT, now let me on the plane. No, I did not spend $3000 on knock-off accessories, here is my blockchain. The odds of someone being able to fake these is extremely low.
But, again, this will never come into practice, at least not in the near future. As @beefcat pointed out, implementing these systems would be expensive for the established financial institutions, and would present new challenges for them to create new processes for handling. An awful lot of work to create something that is stronger and safer when there is little motivation for them to do so.
I don’t know, this sounds a lot like DNA evidence. Sounds great in theory, but doesn’t actually mean what TV implies it to mean. In terms of a receipt, you still need to tie that to a person, or the wallet to the person. Given how easily people have lost their wallets, it’ll be a similar issue to “My credit card was used at that time”. Yes, the wallet / CC was used at a place at a time, but who was the person using it? In either case, they’ll want to use the security video or clerk witness testimony to tie it together.
I’m not even sure what situation you’re thinking that the airline would not accept their own printed ticket or shot of the ticket PDF or whatever they send you today, but the NFT would make all the difference. Again, either the Airline system reads your ticket data, whether it’s NFT, barcode, or traditional digital and can tie it to a sale in their system or they can’t. They can lose the NFT link just as well as the barcode link, and the gate agent isn’t going to understand or care that you have an NFT that cryptographically proves “blah blah blah”. They’re already checking ID. For someone to fake the barcode version, they would also need a fake ID or Passport to match it.
I sort of see what you’re saying if you went to court, and the airline wouldn’t do discovery or purposefully shredded their records of your ticket for some reason, but we already have receipts and bank statements and the like that do the same thing, and an NFT doesn’t change needing to prove you bought it in this case, presumably via linking a wallet rather than a bank account, though wallets don’t have the ID requirements bank accounts do, so in court that could actually be rather harder to do.
@dreadgoat@kbin.social @beefcat@beehaw.org there’s a whole insurance industry for covering legal fees regarding improperly titled real estate and it generated over $20 BILLION dollars in premiums in 2022!
If the title to a house were an #NFT, you could verify it’s validity in seconds!
