A Tale of Bitcoin Companies that Provide No Value
1039 sats \ 7 comments \ @tomlaies 6 Aug 2022 bitcoin
Hi everyone, I want to let out a little steam right now because I'm infuriated
Yesterday, a "Bitcoin Company" joined our Meetup group to promote their product. (I don't want to mention the companies name because they might be an outright scam, Idk yet). A little annoying, this is a private group and no advertisement space. But let's give them the benefit of the doubt and hear them out.
Their business model is as follows: You can buy stuff from their website, they send it to specified Bitcoiners in your city and we are supposed to exchange the received packages at our Bitcoiner meetups. Makes sense, if it's legit it is an interesting business model. The buyer can be KYC-free, pay with Bitcoin and get his stuff.
But here is the thing: This provides no decentralization or trustless system. The buyer still has to trust the online shop that it ships what it does. The buyer has to trust the package receiver. The package reciever has to know the buyer and trust the buyer - if he doesn't he can't make sure he isn't used as a money laundering infrastructure for drugs or illegal weapons and that the police won't show up at his door. The package receiver also has to trust the online shop.
See what is happening here? This is no different than a Bitcoiner asking another Bitcoiner to buy something for him on Amazon. It requires bidirectional trust between buyer and package receiver, it requires bidirectional trust between package receiver and online shop.
Why should you care? Because there are lots of Businesses like this out there. Of course we want to support everything Bitcoin and everyone who wants to blow life into the ecosystem economy. But it is like with shitcoins or with lending services that take custody of your Bitcoin for claimed 20% interest rate: We first have to ask ourselves if it provides decentralization and trustless setups. And if the answer is no then they are taking advantage of the community without providing value.
write
preview
related posts
202 sats \ 1 reply \ @DarthCoin 6 Aug 2022
https://lightningescrow.io/ and also https://darthcoin.substack.com/p/the-dark-side
reply
0 sats \ 0 replies \ @DeezSats 6 Aug 2022
lightningescrow.io is the way! It is a sorely needed service. Notice it is based on trust and reputation, while preserving its customers' privacy in a trustless way. That looks like a business I could interact with. Of course if a completely decentralized escrow system could be devised, that would be better, but that is a tall order and things like this solve problems today. It is an innovation only made possible by bitcoin, and plays a role in the circular economy.
reply
1 sat \ 0 replies \ @mikhael 6 Aug 2022
Lol this is what all the Blockchain culture misses - Bitcoin and other various financial innovation solve a technical problem, but they don't solve political problems.
We still have to deal with human beings, who are unpredictable and can pull the rug out from under you. We have to deal with middlemen.
Bitcoin doesn't help with that. All it is is P2P digital cash, nothing more - and pretending it's anything more is just going to get you into trouble.
reply
1 sat \ 3 replies \ @DeezSats 6 Aug 2022
I don't agree that everything has to be trustless and decentralized. That is the wrong measuring stick for a bitcoin small business. Reputation system works. That said this example company raises serious red flags for the reasons you mention, it is not scalable, and the problem they purport to address needs a decentralized solution. No business should put their customers in the Fed's crosshairs, which is the domain of fiat. I haven't seen many scams like this in the bitcoin space. The fact you don't mention who they are demonstrates the power of reputation as they will in short order have none.
reply
0 sats \ 2 replies \ @tomlaies OP 6 Aug 2022
I don't agree that everything has to be trustless and decentralized.
That's the point. Does it need decentralization (y/n)? And if it does, can it be solved with Tor, torrent or Bitcoin? The answer is yes.
Everything else is a shitcoin.
reply
101 sats \ 0 replies \ @earnbitcoin 6 Aug 2022
And if it does, can it be solved with Tor, torrent or Bitcoin? The answer is yes.
There have been numerous collaborations since the beginning of bitcoin (and probably before) on building what this "bitcoin company" is pitching.
Here's discussion on a much earlier idea which never materialized:
BitDrop (or ShadyDeliveryNetwork), a non-robotic courier system https://bitcointalk.org/index.php?topic=6279.0;all
Decentralized Package Shipment System https://en.bitcoin.it/wiki/Decentralized_Package_Shipment_System
And there have been numerous ICOs and such since, of one variety or another of this decentralized parcel delivery concept. None got anywhere (see NextPakk, then XPackk as an example of one that at least became operational).
Anyway, ... my point is the reason it keeps coming up is because parcel delivery is something we all use, and there could be alternative approaches that do it better than the current (corporate) methods.
Arcade City (now that they're again bitcoin-only, and LN-enabled now), which started out as decentralized Uber, wants to build whatever other P2P / gig services as make sense, so we probably will see parcel delivery be one of those services from them.
reply
5 sats \ 0 replies \ @DeezSats 6 Aug 2022
I guess I was adamantly agreeing with you, lol.
reply