Opinion: The crypto world is reborn on the brink of collapse

AC believes: Crypto is walking the old path of monetary policy in the early years, repeating the same mistakes, and re-making the mistakes that monetary policy has made before. Dragonslayers may be slowly turning into dragons. Wave after wave of Crypto iterated it into another shape, and we can’t remember why we set out in the first place. Crypto culture kills the Crypto spirit.

Indeed, it seems so. Instead of prioritizing core values ​​(decentralization, security, privacy, ownership, innovation), we focus on the stimuli of short-term greed (catch, hype, crowded with frenzy). This situation is rather sad.

These are just a few of the dark sides, but:

More and more public chains love stable coins, stable coins are Ponziized, and the mechanism is too simple and crude (this article was written in April 2022, when Terra did not collapse). The theoretical TPS is extremely high, but the TPS per second is lower than that of Ethereum Square.

Most DeFi projects are increasingly embracing regulation, which is contrary to the original intention of less intermediaries and permissionless.

Most GameFi is not fun at all, and the unsolved economic system will always end in a death spiral.

Most of the NFTs are dog-like and useless or basically useless community concepts. The more expensive it is, the more art it is. The airdropped tokens are also the air that feeds Ponzi and cannot be landed, just to continue the story for dolls.

Most DAOs are white prostitution, and a slogan can make people confidently recharge. Everyone has added no less than ten DAOs. There are more DAOs than people, and their work efficiency is extremely low.

Most project tokens are useless, although it is said to have the utility of governance, but is the staking process really for voting? Does a few painless votes really allow users to own a part of the protocol?

Opinion: The crypto world is reborn on the brink of collapse


Centralization equals low price, and decentralization equals value. The high gas you pay represents the added value of decentralization. Blockchain has many angles and levels of decentralization: decentralization of computing power, decentralization of governance, decentralization of tokens, decentralization of applications, decentralization of storage…

As a blockchain or Crypto project, the common practice of the project is to build it in a centralized manner first, and then slowly decentralize all aspects in the implementation of the roadmap. But although the future is depicted very well, if any project is to be completely decentralized, it is really not there, but complete decentralization is not the best state.

No one really cares about decentralization, so if you really want to build a truly decentralized protocol, you have to make a commitment to centralization at the beginning, otherwise you will only compromise in the long process, until Lost the right direction.

We will start by discussing the decentralization vision of Crypto and the need for decentralization in some areas, starting with the decentralization of Bitcoin development.

1. Whose Law is Code?

A point of view that is often mentioned in the Web3 era is that code is law, and code can refer to network protocols, smart contracts, or code of “recommendation systems”. The essence of code is law is actually the social consensus of the new world (the scary kind) , we mainly focus here on the issue of code and decentralization of development, and the role of users who do not understand code in the world of cryptography and computing.

There are many direct interactions between Web3 natives and “law”. Compared with real law, Web3 natives are also more aware and familiar with Code Law. But just like law, code modification, governance and promotion are also very difficult, more centralized.

a) Bitcoin’s P2SH battle

Bitcoin Magazin recorded the first war of Bitcoin code changes: the P2SH battle. This is the first network upgrade since Satoshi Nakamoto left.

In the years when Satoshi Nakamoto appeared, under his leadership, Bitcoin made many protocol changes without extensive discussions. Of course, this is a relatively centralized embodiment, but Satoshi Nakamoto himself was behind Did a very decentralized thing, that is, he disappeared, but also created the decentralization problem at the development level that we discussed.

Andresen, a core contributor to Bitcoin, became the appointed leader of Satoshi Nakamoto. He promoted the OP_EVAL opcode involved in P2SH, and hoped to launch it as soon as possible to realize the function. However, the introduction of OP_EVAL would cause some problems, and the developers split into several factions , one faction believes that the release should be released quickly, the other faction thinks that the release should be delayed, or other alternatives are used. So the developers decided to let the miners vote with their computing power, but the problem is that if the miner client does not upgrade, it will vote for support by default . There have been countless debates between developers of various factions.

This kind of undercurrent has been constantly happening in the development of the network, but as ordinary users, we cannot see these conflicts and differences. How should a decentralized digital currency be developed, how to make decisions, and how to decide Where is the direction?

b) Controversy is ongoing

Behind the scenes, the asymmetry between users and developers also leads to the fact that users usually only listen to the most vocal opinions. For example, many people may not know that Bitcoin will activate the BIP-42 soft fork in 2262 (right), I don’t know that Bitcoin was discussing using SNARK to scale in 2013. These are interesting from the perspective of the story, but if you think about it carefully, these things, as ordinary users or miners, seem to be unable to participate in Code Law, The characters in the story are core developers and people who understand technology.

An incident similar to P2SH happened recently. Some developers pushed an update without reaching a consensus with other developers, without going through the update process of Bitcoin Core (the Taproot update has also occurred such an incident, but everyone trusts That developer, so didn’t fire him). Such a change is seen by some developers as an attack on the Bitcoin network, just like the BCH kind.

Opinion: The crypto world is reborn on the brink of collapse

c) Who exactly controls Bitcoin?

Bitcoin Core is not the Bitcoin network, not the command and control point of the Bitcoin network, but the focal point of Bitcoin, nothing more. The Bitcoin network is not controlled by the Bitcoin Core, that is, in the de facto sense, development is centralized And the lack of strict processes does not directly affect Bitcoin.

But Bitcoin Core may be controlled by these people: GitHub internal employees (stealth tampering), and the keys of several developers (not the developers themselves). Among them, the developers have experienced withdrawal due to public opinion, or were Others kicked out. When the developer’s push is not passed, they may come directly and fork.

We need to focus more on Bitcoin Core or other development teams to make sure that at least the focus of the Bitcoin network is correct.

d) Facing the Law of Code

There are more than a dozen versions of Bitcoin nodes, all of which are generated due to various development differences. The current dominant version is Bitcoin Core, because Core’s code usually means the best performance, the most secure, most.

Opinion: The crypto world is reborn on the brink of collapse

The status of Bitcoin Core is not important, it is not a single word. It doesn’t really matter who controls Bitcoin Core, because it is everyone’s consensus at the end of the day. Node operators or users mostly hand over power to developers, which is Their consensus, which is their choice. In this case, the centralization of Bitcoin Core development may not actually matter, because no one forces nodes and users to run Bitcoin Core, Your Node Your Code. Of course any code changes require After a rigorous review to ensure that it is the best solution.

Bitcoin does not actually require “voting”, nor does it require ordinary users to participate in the development process, nor does it require democratic domination, nor does it require the pure decentralization of development. Bitcoin is anarchy, but requires rules, determined by the network The nodes are governed, defined and executed from the top down.

Decentralization is not as effective as centralization at some levels. For example, decentralization at the development level is needed for the team, but for the network, the decentralization of development may not be important…?

e) Code is Law is violated

We went at length about why we could trust the development team of Bitcoin Core if we wanted to, but while Bitcoin Core is our consensus, must they be right?

An overflow bug in 2010 caused a fork, which violated the longest chain principle, and 53 blocks were rolled back (0 in DAO event).

The problems involved in BIP-50 led to at least one double-spend transaction, slapping PoW.

The problem fixed by BIP-42 is that Bitcoin will have an infinite supply due to overflow. Whitepaper is Law, Code is not.

These are all because of the development team’s pot, which violates Code is Law and the concept of network decentralization. It does not mean that code and Law cannot be changed (just discussing Bitcoin, without any innuendo), but some development teams can sometimes In one word, let the entire network make amends for their mistakes. And with Bitcoin Core, we choose to forgive them time and time again.

Opinion: The crypto world is reborn on the brink of collapse

Is Bitcoin still the decentralised currency as imagined?

2. No trust required?

Moving on to the topic of consensus, although Bitcoin Core is everyone’s consensus, does everyone have to believe in consensus, or obey the majority?

There have been many live examples recently, and the projects are as follows:

We have a high APY (this article was written in April 2022, when Terra did not collapse), our investment background is very good, the technology is very advanced, and it is too revolutionary.

Our mechanism is too safe, but I don’t know what will be wrong in the implementation.

Our funds are managed by a particularly secure multi-signature wallet.

We are temporarily based on centralized services with better performance.

Our contract code may have accidental or intentional bugs.

Everyone rushed in when they saw the first few words of the first article, not DYOR. This is a common misreading of the trustless feature. If you don’t understand code, technology, or finance, then you need to be cautious, Blockchain is a terrifying dark forest… Anyone who abandons judgment and obeys “authority” may have dire consequences (simply talking about blockchain, without any innuendo).

Opinion: The crypto world is reborn on the brink of collapse

THORChain has done a very good job in this regard, but we still have to check whether it is the case, but it is still much better than an application that says its security is completely dependent on several multi-signature applications with unknown risks.

For things in the blockchain or online world, we must treat every day as April Fool’s Day and think about whether this thing is true or false.

3. No permission required

Although most people don’t want to, some users really want and need to run their own nodes. And the configuration requirements of many blockchain networks directly persuade them to quit. The real ultimate decentralized network is to allow ordinary users to run on home devices of.

Remember the section about no need to trust? Users can run a node or service themselves, in fact, they can remove a lot of additional assumptions that may be risky attached to the network (such as a relatively centralized Sequencer). In any case, allow users to join Coming to the network, it is a great addition to the overall diversity of the network, as well as to the user’s own security and privacy use. This is very typical of Solana, and nodes may be actively reviewed when they are down and restarted. Remove “suspected malicious transactions”. In contrast, Ethereum’s Danksharding plan is very user-friendly. Mina is also very good, and can even run in the browser.

For client diversity, even Ethereum is not doing very well. Of course, taking the example of browsers, it is difficult to break the monopoly of Chrome, and it will take a long time.

Opinion: The crypto world is reborn on the brink of collapse

Users also need to run their own application front-end. In many cases, the protocol is decentralized and neutral, but the application front-end is mixed with many other contents (Tornado.cash, Uniswap, dYdX, some bitcoin wallets), It leads to blocking and censorship. Although it may indeed have a positive effect, it has an impact on the decentralization of the application. The application needs to provide a decentralized open source front end, which can be hosted by users or the community, so as to ensure the application Censorship resistant, neutral, and decentralized. We need Arweave.

For a free and open Web3, any redundant permissions need to be removed, otherwise it will not be decentralized.

Privacy and Ownership

Web3 = Read + Write + Own. To have true ownership, we must find a balance between privacy and publicity.

In real life, ownership represents the ownership of houses, which means property rights, that is, the ability to refuse others’ use. In the Web era, from Web1 to Web3, everything, that is, data, is based on sharing and dissemination to increase value. We use NFTs to find a balance between publicity and ownership.

Opinion: The crypto world is reborn on the brink of collapse

In the Web2 era, our data is “sold” to Internet companies, creating value for them directly. In the Web3 era, the data we have creates value for ourselves. We hope that these data (Meme, NFT, big-ticket transactions) will be more widely disseminated , and this data can represent our own identity. But these spreads make our privacy exposure even more risky.

We need cryptography to guarantee our privacy while making the value creation process of our ownership more secure. Cryptography is the only means to enter the Web3 world and truly bring privacy.


The thriving development of blockchain and Web3 is based on innovation including: open source 2.0, composability, decentralization, ownership. Innovation is a necessary condition for success in any new field.

Higher stablecoin APY (halving next week) and higher TPS (lower than Ethereum in actual use of the mainnet) after careful “calculation” are not innovations, but a life-and-death struggle in a meaningless direction.

Opinion: The crypto world is reborn on the brink of collapse

The essence of innovation is to solve problems that others have not solved, and of course to create new problems that cannot be solved at present.

1. Solve problems that others have not solved

Really excellent innovation can be described in one sentence, the following are several typical public chains:

Avalanche: The earliest easy-to-use low-gas EVM chain.

Arweave: A permanent storage network without any censorship.

BSC: A fast and cheap centralized public chain.

Solana: Super throughput, contracts can write Rust.

Cosmos: A new blockchain network structure.

Arbitrum: Cheap, while borrowing the security of Ethereum.

In this process, if these problems are solved by others, innovation is likely to lose its meaning. For example, Polkadot and Near are both working on the roadmap of the previous version of ETH2, and ETH2 has already proposed the next generation of Rollup universe. Brand new solutions (it seems that only Bitcoin and Ethereum have the stability and popularity to support Layer2). They are all good innovations, but over time, they are a bit outdated, and they are indeed creations, but not so new.

2. Create new problems that are currently unsolvable

Each innovative branch may bring more problems after solving a problem. After the blockchain is created, the problems of expansion, consensus, and security also gradually emerge. There will also be collapse and integration. Process. Computers were created to make computers better. It is difficult to explain why an innovation is useful, but when the innovation creates more problems, we know that at least we will reap more progress later.

Every day-to-day thing that is taken for granted is an innovation optimized by the brains of the predecessors. At present, Web3 is the best place for innovation, and we need to cherish every potential paradigm innovation and ignore the meaningless paper innovation.

Whether the goal is really high-quality innovation can actually be condensed into two questions.

Is the first purpose to improve the technology/model/industry? (Could be a mild Ponzi structure, but not a Ponzi scheme.)

Is it a good new Meme? (New Kind of Money, Rely on Math not Validators, The Internet of Blockchain)

Key research dimensions

1. Next-generation infrastructure

Every year is the year of Web3 infrastructure. It’s a good thing, and it means we realize the foundations of the industry need to be stronger. Infrastructure inspires new applications, and applications inspire new infrastructure. But beware, no An infrastructure that solves the problem and cannot develop into an application is still meaningless.

Opinion: The crypto world is reborn on the brink of collapse

Infrastructure encompasses countless directions:

New chain: The chain is the network layer of the application and is the basis for the operation of the application.

New bridges: Bridges are necessary to communicate between networks.

Developer Resources: Next Generation Developers, More Researchers.

Facilities for developers: better development tools, more readable data, faster and more meaningful build tools.

Facilities for users: better wallets, better applications, especially for Web2 users, which will represent the overall expansion of Crypto.

Public Goods: Providing value to Web3 and the world at large.

The role of infrastructure is critical and deserves constant attention.

2. Next-generation innovative technologies

We need to look for innovations at the surgical level, not at the pharmaceutical level and the patch level. What I personally think of as a typical example of next-generation innovation is zero-knowledge proofs.

The first era of Crypto is Bitcoin, the second era is Ethereum and smart contracts, and the third era will be zero-knowledge proofs.

Web3 will be innovated due to the popularity of zero-knowledge proof technology, and it will be a more standardized, efficient and comprehensive development method.

Opinion: The crypto world is reborn on the brink of collapse

Zero-knowledge proofs will satisfy all decentralization (mining in the browser), no trust (additional trust assumption is math), innovation (alien technology combined with cryptography), privacy (zero knowledge is privacy), Meme (Cryptography and mathematics are the biggest “Meme” created in human history) and other features that Web3 should have.

In addition, I also very much look forward to the fusion of Web2 mature technology and Web3 to create a new generation of innovative technologies, such as the real integration of machine learning and Web3, and hardware innovations to make zero-knowledge proof and other technologies play a greater role.

3. Next-generation business models

DAO: More exploration of the DAO model is needed in the future. What can DAO do? What is suitable for it? How should it be done? DAO is the core of the Web3 and Crypto space, closely surrounding the community and users. We will continue to study the impact of DAO on traditional systems improvements, and the evolution of the DAO itself.

Creator economy: The creator economy is very similar to DAO. It is a concept that everyone is very familiar with, but it does not have real value. Art creators have their own communities and economies through NFT, but music, video and other fields create After countless times of blending with NFT, it seems that there is still a rejection reaction, and it is impossible to truly integrate and innovate. The real realization of the creator economy may require more co-innovation between Web3 social networking and NFT.

Guild 2.0: Guilds have been evolving with the appearance of games, and the emergence of Play-to-earn mode has given guilds a new lease of life. Guilds play an increasingly important role in the field of Crypto Gaming, playing a role in management, operation and integration . I believe this model will become more mainstream in the future, making the Crypto game industry more mature.

NFT 2.0: We all like PFP, but it may be just a consumer product (for now). What is the role of NFT? In fact, everyone has always had some hazy ideas in their hearts, it is Pass, Link, Art, Or Meme?


Remember the idea of ​​AC at the beginning? Nonetheless, we are entering a new era, and we are a new generation that can do better. Blockchain may be stepping into a wasteland for a while, and there are not as many “easy” innovations, But the foundation of Crypto has not turned into profit-seeking greed, but perhaps moved from trustless to partly trust-based. Still, we are on the right track.

Opinion: The crypto world is reborn on the brink of collapse

We should not be a decentralized Maxi, the existence of these core values ​​is not black and white, we just need to take them as the primary consideration at all times. For example, in the development and governance at the beginning of the project, these are not so necessary Decentralization can get some concessions, so that the entire Crypto and Web3 fields can really be built and developed rapidly.

Opinion: The crypto world is reborn on the brink of collapse

On the bright side: Web3 is already very good. There are countless young people and talented people migrating into Web3, using and building, which brings free mobility. We are on the hype train at a rapid rate, and in general this is A very good thing. This is a land of new opportunities where you can build the future, own ownership, incorporate digital identities, enable open finance, compose open source Lego, have a new generation of global work models.

Technically: Crypto brings infinite innovation. Consensus: Nakamoto Consensus, Avalanche Consensus; Cryptography: STARK, PLONK, Halo2; Computation: RISC Zero, Zexe, Cairo; Privacy: Zcash.

Pessimistically: Sometimes, you have to let it break. While Web3 is so absurd right now, it will collapse and merge, and then enter a new life. In a rapidly changing Web3 world, the biggest risk is not to take any risks, We need to identify real value in the clutter.

Even if you don’t care how to get Crypto to the right direction for the new life, at least some people care…  

Opinion: The crypto world is reborn on the brink of collapse

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Posted by:CoinYuppie,Reprinted with attribution to:https://coinyuppie.com/opinion-the-crypto-world-is-reborn-on-the-brink-of-collapse/
Coinyuppie is an open information publishing platform, all information provided is not related to the views and positions of coinyuppie, and does not constitute any investment and financial advice. Users are expected to carefully screen and prevent risks.

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