The web is fraught with scams because it's grown to the point now where the only remaining ways of making next-level Internet money on the web are to resort to wildly complex and unethical tactics and/or deception to get attention, to fake success, or to spend a lot of money to gain attention. Social media is also not accurate in it's portrayals of potential for many because they simply are too big to allow users to succeed or even to be organically visible now.
Something like NFTs, which are totally worthless digital files in real life, are marketed as "valuable goods", and it's literally insanity... Trust me, I've seen plenty of pitches even when I didn't want to on social media... Non stop. If you lose your wallet your money is gone? No FDIC protections? Good luck waiting for government to catch up on proper regulations.
Even if this poorly though out pyramid scheme of branding the online greed heist as "Web 3" succeeds, it will be short lived once the rich cash out, and all that will be left is a totally broken internet with no commerce flowing through it, and the value of real world products and services will be severely corrupted by it all. Everyone will suffer for it, from the rich that get literally mugged on streets by the disenfranchised to the disenfranchised that spend years trying to find success with their last dollar.
The solution is to stop supporting platforms that are peddling this phony pyramid scheme, and to reinvest in keeping the Internet open, and to stop money and influence from changing how the Internet worked 5 years ago, but even if you don't change this terrible course, you'll suffer too when you realize that everything has been dumbed down or made overly-complex on the Internet and function and utility have been corrupted to get you to pay for upgrades each month...
Internet-based business had been making record breaking profits for years based on fair payment for advertising space, and for selling tangible goods and services. If you start a high-overhead business for free and then try to convert it into a paid service then that's where the business model went wrong, not because users are now dependent on the service and primed for milking that dependency.
The only people advocating the schemes are people who are invested in them, but they're too caught up to admit the simple truth. We will learn how to communicate in real life again probably while the Web3 dumpster fire burns out, and then rebuild hopefully... :/
> Something like NFTs, which are totally worthless digital files in real life, are marketed as "valuable goods", and it's literally insanity...
I agree that marketing NFT's as investments is outright insane, but a NFT is not just a "file". It is simply a certified, non-forgeable stake in a crowdfunded endeavor. NFT's can thus be used to promote openness, no different than any other form of patronage.
That's a really overly-complex way of stating in jargon that it's a digital file with another (encrypted) digital file attached to it that means absolutely nothing if it's lost by hardware or connectivity failure or if the power goes out.
Tom Selleck selling reverse mortgages was bad enough.
In reality, a lot of NFTs are ultimately purchased by their owners in the course of laundering money due to the lack of oversight, and there's a lot of profiteering in the process of minting NFTs, so there's a vested interest in recruiting people into the establishment.
People that trust it without proper research are getting ripped off in droves, victimization at it's worst... A Lot by this hustle. The modern way of downloading a car.
Really makes me wonder if anyone (except corporations) really is making honest money over the Net any more to be frank.
> It is simply a certified, non-forgeable stake in a crowdfunded endeavor.
No it's not. It is not non-forgeable (blockchain can always do a "Vitalik" and rollbback whole database), it also doesn't certify anything because there is literally no space inside NFT for certificate of any kind. (technically there are a few bytes, but that's not enough)
> NFT's can thus be used to promote openness
No they can't. Again, there is nothing in the NFT to facilitate this.
>>If you lose your wallet your money is gone? No FDIC protections? Good luck waiting for government to catch up on proper regulations.
You can use a smart wallet where you assign your own set of n guardians (even your own phone can be a guardian), and m and n of those guardians can recover your wallet, with you deciding on m and n.
Such wallets can even have software enforced daily withdrawal limits, which can only be overriden with the approval of the guardians.
It's a completely open system which can be configured any way one wants. A one-size-fits-all government solution destroys innovation and breeds rent-seeking bureaucracy.
I suspect the people most vehemently lobbying against open-finance/Web-3.0 are those most deeply entrenched in the centralized power structures of the establishment.
One thing I could agree on is the multitude of scams, deceptive marketing etc in the Web 3.0 space. This is a consequence of money being freed from its reigns. It has both positive and negative consequences, and those are the negatives.
But finance is on the balance beneficial to humanity, by facilitating more sophisticated coordination, so when you turbo-charge finance, you get a net boost to human coordination.
> I suspect the people most vehemently lobbying against open-finance/Web-3.0 are those most deeply entrenched in the centralized power structures of the establishment.
Crypto shills are not the underprivileged, poor/homeless class of society either? They’re usually well-paid, educated tech/finance bros.
Yes, I wouldn't be surprised if crypto holders started off as wealthier. They're certainly overly-represented amongst the wealthy now. But they'll be under-represented amongst the centralized establishment.
Some interesting facts about crypto asset holders:
Nearly half of Millennial millionaires have more than 25% of their wealth in crypto. Millennials have otherwise been floundering relative to older generations in terms of wealth. Crypto is a rare bright spot for the younger generations, so it's unsurprising much of the older establishment wants to crush it.
> With regard to lottery play for respondents of various racial/ethnic groups, non-Hispanic whites and Native Americans had the highest proportion of gambling on the lottery (51% for each group); however, with regard to mean levels of gambling on the lottery, blacks and Native Americans had the highest averages (20.6 and 25 days, respectively).
> Those in the lowest fifth in terms of socioeconomic status (SES) had the “highest rate of lottery gambling (61%) and the highest mean level of days gambled in the past year (26.1 days).
The wealthy people are the ones selling the lottery tickets (/crypto).
> Also, 44% of crypto holders in the US are non-white
Depending on how Hispanic people are counted, thats almost exactly in line with the 2020 census, which puts the non-hispanic white population at 57.8% [0]. I think if you adjust for the average age of cryptocurrency holders, 56% white would actually be more white than the demographics of the overall age group, which I think is not the point you were trying to make.
The proportion of the US population that is white is 72% if hispanic whites are included. That would be more in line with the statistics I saw showing black and hispanic Americans are over-represented among crypto holders.
That's true. But it's also true that those that brush off the idea of whats essentially a checking account denominated in a currency of their choice (i.e. stablecoins) is unnecessary. They're usually well-paid, educated bros from a developed country where they have access to a well developed financial network, have banks in their neighborhood, have a stable currency and don't live under capital controls.
That is such a fun attack vector, can't wait to see all the stories about socially engineered attacks when this tech will spread.
Now crypto user not only will need to audit all source code of his wallets ans every smart contract written in whatever flavor of the day language including Haskell. But they will also need to do an interview and assess technical knowledge of every signer of his wallet. Every wallet. It will be glorious :)
People don't need to personally audit the software they use or create their own security protocols. Software will emerge that has undergone audits from recognized software security firms and best practices will emerge for how to create personal security networks. Devices will also be created to simplify and make user-friendly the process of acting as a guardian.
1. Much less centralization than legacy finance, as you only have to be able to trust in the integrity of open source software released at one point in time, not trust a black box corporation and government over the course of a long period of time while your funds are deposited at a bank.
2. The centralization is not mandated - you can choose to audit the software yourself.
3. If you do choose to rely on a trusted third party, the set of parties you can choose from is open, with no restrictions on who you can choose to rely on.
Overall it enables a much more configurable and open financial system, with a larger set of parties able to participate in the market, and a much larger range of configurations that those parties can utilize.
It's at least possible to smuggle a wallet/brain wallet passphrase (or a signed offline transaction) out of the country via sneakernet, homebuilt amateur radio, "professional" smuggling operations that can relay a message to your family outside of the country, point-to-point across the border, or a coded letter/telephone conversation if you suspect you're under surveillance. There's always a strategy to get the money out of the country (though I admit, not necessarily in the other direction).
You can't do that with a bar of gold, or a bundle of banknotes.
What I mean is that while traditional stores of value are portable, they are harder to hide and easier to confiscate. A wallet or offline transaction is just a piece of info that can be scribbled on a piece of paper that a customs agent or border guard won't look twice at. Even if they do confiscate it, you've lost nothing because they can't change the destination of the offline transaction, or decrypt the wallet (if encrypted).
Not to mention that it's exactly as easy to smuggle and disguise a $50 worth of digital currency as it is to smuggle and disguise $50k worth of digital currency. This can't be said of banknotes, especially if all you have available is lower face value notes.
It feels as if 5 similar articles reach the HN top page every day like this. The same arguments are made, the same rebuttals are made, the same comments are made ad nauseam, every single time, with no apparent conclusion. Are we officially living in a simulation? What's happening?
Waste-maximizing mining farms only add to the cost (before you say "PoS": the model of a plutocratic oligarchy that can further concentrate their wealth by taxing all transactions doesn't sound cheap either).
Cost of hosting and bandwidth is asymptotically approaching zero. For most things it can be easily subsidized with pocket change. For bigger things, the pre-tollbooth-on-everything Web has already figured out Bittorrent and p2p protocols where basically the receiver pays/subsidizes it through their ISP.
> the model of a plutocratic oligarchy that can further concentrate their wealth by taxing all transactions doesn't sound cheap either
How is that different from what banks do right now for all your transactions? It's the exact same and owned by Wall Street oligarchy (Morgan Stanley, Goldman, BoA, Citibank, etc). The only difference is that you can't reverse the transaction.
As for the rest of your argument, I agree; although, idealistic and unlikely. I simply found it ludicrous that author thought the internet is powered by fairy dust.
In EU countries many fees are regulated and have caps. For example, debit card interchange fee is max 0.2%.
In the real world rich are getting richer and use their wealth to gain even more control too. But in a PoS system this is not a bug, but the core mechanic of the system. You can't even make a PoS system that is even slightly egalitarian, because then a "rich" wallet could be split into many "poor" sockpuppet ones and gain even more influence.
To be fair, if you hook up a raspberry pi or some random old laptop to the web you can serve a significant amount of traffic as long you mind how you construct your website.
> I'm willing to pay the hosting fees for that and it's my decision not to pass this on to any visitors.
You are willing to pay hosting fees. But do you pay for Gmail, Instagram, Facebook, YouTube, Twitch, and a whole host of other platforms that the majority of the population uses?
Remind me how companies that have billions of users pay for it? How many people are going to visit your website compares to theirs? How much do people like you contribute to the entire revenue stream?
The creator economy is tiny compared to these platforms.
If the web if kept free then there are other groups of companies or "communities" that are profiting off your data.In no way has server costs ever been free.
Servers are cheap and computers are fast. This site appears to be hosted on Neocities: a platform with a generous free tier that doesn't profit off user data.
Cheap is not free. People are putting in the work on Neocities to make sure the platform stays up, reachable, and free of abuse. There's regular stories of open-source maintainers burning out due to the support burden. If you're not paying for the service, then the service owners will raise money some other way or stop offering the service. Today, that way is ads and data mining.
If you are operating a small website, sure. Most business aren’t. How does Neocities earn money if no one is footing the bill? Free tiers are a marketing strategy, not a business model.
There really is no reason businesses need to run colossal bloated websites. That's mostly the result of technical ignorance from business owners. No ignorance is inevitable.
It seems really odd to lambast the 'claims of web3' and then link to a project with far great ambiguity in how it intends to 'make a better, free, decentralized internet'. Indeed, even the authors have to write a dripping apology justifying why they are reliant on Discord, a highly centralized chat service.
Every time web3 is mentioned, a sizeable portion of HackerNews goes into "old man shouting at clouds" mode and logic seems to go out the window.
Noone who has any interest in web3 is going to change their minds based on strawman sloganeering arguments like those presented in this article, and it's hard to imagine someone who is currently undecided being persuaded when the very first arguments presented are as weak as 1)"There are projects with this thing called 'quadratic voting' that I don't like" 2)"You don't need cryptocurrency to be decentralized" 3)"If it was good why would FB and Twitter allow it?"
Yeah I've read a bunch of those and if nothing else they actually make some points that need to be discussed. I think things like pointless and excessive energy use, "don't you just need a database really", "doesn't decentralized storage kind of suck in lots of important ways" are much more substantive criticisms that web3 projects need to address than "I disagree with how some projects choose to organize voting", which is nothing more than a bottomless bikeshed and could be made validly made about "pre-web3" projects as well.
For example, I can remember Debian for example having "lively debates" about its voting system inside and outside the community since at least as far back as 2000. I don't think anyone outside that project has any right to an opinion about how Debian want to arrange their voting and I feel the same way about every weird-ass token-voting system some web3 project wants to put in place.
I think it's implied: don't pursue cryptocurrency or the blockchain where traditional methods work just fine.
The problem right now is that there's a peverse incentive for entrepreneurs to jump on the crypto/NFT bandwagon because a bunch of VCs are desperate to fund those sorts of companies. Nobody in that space is incentivised to point out that the emperor has no clothes.
There's a lot of people who have their money tied up in the crypto space. If it takes off, they get rich without doing anything. If it crashes, they become poor. So they have a huge incentive to push crypto even if it's not actually good for anyone but themselves.
The solution is to not perpetuate this web3 thing.
What problems does web3 attempt solve anyways? The internet is mostly decentralized already. Maybe the apps and services are localized walled gardens, but you can already vote not to participate in them w/o hashing anything.
It does solve problems. The question is whatever current solution should be adopted as it's has it's own flaws and we can get stuck with them for decades.
Censorship resistence for developed world countries. When you cant just rewrite history we might finally get rid of "illegal numbers" situations like blue-ray keys and such.
And for less fortunate, failed or just athoritorian states there will finally be some option to access international banking system. It's like tor for money. Because crypto is controversial in countries with functional government, but it's might be the only way to fund opposition activity in more oppressive regimes.
> Censorship resistence for developed world countries.
This is one of those things that either can't really work or is going to cause a massive disaster, such as when someone publishes the next OPM leak on the blockchain.
Can they be solved? How would you suggest to solve early adopters / whale issue?
In crypto you're represented by pair of keys and by design anyone can have as many pairs of keys as they want. And to fix it you'll have to compromise on decentralisation and / or privacy.
For now almost every single crypto project including majority of legit ones is some sort of pyramid scheme.
its a bit odd that they don't mention any of the other projects that are being worked on today that don't rely on cryptocurrency, the "SAFE Network" being one of them
The criticism of catering to early adopters and whales is a bit weird to me. How is this different than any project that receives funding? What's the ideal solution for this?
Personally, I'm curious to see a project like Mastodon or Peertube fund itself using a token. I don't think those projects will ever get any meaningful use aside a few nerds and outcasts that got booted off of Web2 properties. You'll probably get speculators in it purely for profit, but to me it sounds better than the alternatives.
> Personally, I'm curious to see a project like Mastodon or Peertube fund itself using a token
Agreed. Most of the people criticizing Web3 are underestimating the power introducing token incentives will have. "Ordinary people" just don't care enough about decentralization of data for projects like Mastodon to take off otherwise. They've been around for a while, and they're not competing with Big Tech. A Web3 platform that rewards successful content creators natively with a token and not hearts/likes might though.
There are still many good blogs out there, niche news sites, people who really love sharing what they know.
What we need to do (again) is to make these hidden gems accessible and "findable" by whatever means, as we see that search engine providers are often motivated by money alone which leads to declining quality in their results.
The web is mostly decentralized, set up a server in your home and off you go.
I wouldn't worry that much about Web3 because very few organizations will care to partake, there's not value in it for them.
If a bunch of kids want to make fake money, tokens and have fun in the their 'Web Tree House' and call it 'Web 3' with Paper Pirate Hats and Wooden Swords then so be it.
> “Now imagine with this proposed Web3 that it’s true that users will own their data and experience. Why in the world would FB and Twitter and the mega corporations allow that? They stand to gain so much.” - my friend Auzzie, a pretty smart dude.
This defeatism is kinda almost the point. Why are we just conceding the internet to this small group of companies? Why not at least try to take it back? I really don't understand what this particular bullet-point is trying to say here.
People tend to forget that users determine the course of things, companies just build for users. Web2 gets better as things centralize, Web3 gets better as they decentralize and compose/interoperate. That is how we change this dynamic and "eliminate the middlemen."
Web3, metaverse and things like that are just vaporware. Not going anywhere.
Someday in the future we will laugh about those terms as much as we do when we remember bill gates vision of “the information superhighway”
I don't agree with your conclusions about Web3, but if you have a vision for the future of the web, go for it - you may be right.
Most of the problems cropping up are due to insecure computer programs that run on a blockchain (aka Smart Contracts).
Centralized control whether VC's and money, or Goverments and regulations, skew the decentralized world into a framework that works for Profit or Fit a government model.
All the things about "community" owned just raise the question that what are the structures the communities adopt, what are the roles and what are their rights and responsibilities, and how are people elected to the roles. And how do you make sure these communities don't end up like the existing communities (countries, companies, NGOs, etc...) that you are trying to differentiate from?
You can't just have a bunch of people and call it community owned. By that definition then this world is already community owned, the internet is already community owned.
You can't also just bypass humanity, this world is the way it is largely due to humanity, not capitalism, not socialism, not because it's not community owned. If the human beings in your community inherently have the same traits as human beings in other communities, how can you make sure you community doesn't end up like the other communities?
People are losing their minds over this. Barely anything web3 has even been built yet. Perhaps it never will. Still, the idea that young people want to do things differently is so terrifying to these geocity boomers that they must churn out pamphlets like their life depends on it. Embarassing.
Yes, it’s definitely not that older people with experience understand why this is a bad idea.
The hubris of youth is useful for bringing change, but experience shows that often the effects of that change are poorly understood and often cause significant issues.
Why do you think this is an age thing? I know plenty of older people that are wild about anything blockchain related and plenty of younger people who despise it all.
If we really want a decentralized internet, the right ISP needs to come along and strike the right balance between allowing ingress traffic and pricing. If everyone could run a website from their homes without worrying about DDNS then things would be much easier -- buy a <$25 SBC, buy a domain name, and you're off to the races on the "small" internet -- if you ever need more then pick what you want.
I’d argue that the complexity of domain registrars and DDNS is less than that of public key cryptography and blockchain. Also again the right ISP would obviate the need and do both things for you, and that gets even easier when ipv6 is even more mainstream.
It’s easy to explain how web2 works right now to a lay person in non technical terms. I think it’s much harder to explain blockchain and even more so the systems and standards built on top. You’re basically going to be asking for blind trust from consumers
Listening to Stephen Diehl is a good way to stay poor. Web 3.0 is not a sector that Diehl and his ilk will be able to get their favorite left-wing legislator to squash.
> Listening to Stephen Diehl is a good way to stay poor.
Wait, so is web3 a technology/concept that can benefit people in general? Or just a “get rich quick” scheme, since ignoring it will make you “stay poor”?
Web3 is very clearly a ponzi scheme, like most things in the crypto and blockchain space. You gotta get in early go get rich. Or stay away and spend time and energy on things that matter instead.
Not all web3 apps will use this, in fact most will run away from any kind of voting system, so moot point.
2. "on a handful of very-expensive-to-run nodes hosted on Amazon Web Services and maintained by insiders."
Use Bitcoin, with lightning, runs in your Raspberry.
3. I don't even get the point he's making.
4. Ethereum themselves suffered a leak that drained their cryptowallet of $55M.
Again, use Bitcoin, don't use centralized hackable shitcoins.
5. "These attacks happen at least a few times a year. Some famous events are Bitcoin Gold in 2020, Etherium Classic in 2019, and Verge in 2018."
And again, the answer is use Bitcoin.
"Any entity (or group of entities combined) that control 51% of the hash rate have the collective power to control the network,"
So you want to buy 51% of bitcoin's mining capacity? You absolutely can, it would only cost you billions, well within the reach of any tech magnate or nation state. But the more you pour into it, the more profitable the mining becomes, thus other miners get more BTC, that they can in turn transform into USD to buy more mining equipment.
6. Artificial scarcity.
I don't even follow.
7. Early adopters etc.
And again, the answer is to use Bitcoin, not preminted centralized shitcoins.
Something like NFTs, which are totally worthless digital files in real life, are marketed as "valuable goods", and it's literally insanity... Trust me, I've seen plenty of pitches even when I didn't want to on social media... Non stop. If you lose your wallet your money is gone? No FDIC protections? Good luck waiting for government to catch up on proper regulations.
Even if this poorly though out pyramid scheme of branding the online greed heist as "Web 3" succeeds, it will be short lived once the rich cash out, and all that will be left is a totally broken internet with no commerce flowing through it, and the value of real world products and services will be severely corrupted by it all. Everyone will suffer for it, from the rich that get literally mugged on streets by the disenfranchised to the disenfranchised that spend years trying to find success with their last dollar.
The solution is to stop supporting platforms that are peddling this phony pyramid scheme, and to reinvest in keeping the Internet open, and to stop money and influence from changing how the Internet worked 5 years ago, but even if you don't change this terrible course, you'll suffer too when you realize that everything has been dumbed down or made overly-complex on the Internet and function and utility have been corrupted to get you to pay for upgrades each month...
Internet-based business had been making record breaking profits for years based on fair payment for advertising space, and for selling tangible goods and services. If you start a high-overhead business for free and then try to convert it into a paid service then that's where the business model went wrong, not because users are now dependent on the service and primed for milking that dependency.
The only people advocating the schemes are people who are invested in them, but they're too caught up to admit the simple truth. We will learn how to communicate in real life again probably while the Web3 dumpster fire burns out, and then rebuild hopefully... :/