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Vitalik Non-giver of Ether Dec 10
1. Time for a brief tweetstorm on non-financial applications of blockchains. As blockchain scalability gets better and better, and UX improves and fees drop as a result, this will become a bigger and bigger part of the story.
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Vitalik Non-giver of Ether Dec 10
Replying to @VitalikButerin
2. One underappreciated way to view blockchains is as an extension of cryptography that does different things. Cryptography allows you to encrypt data, prove data was signed by someone, etc etc.... blockchains OTOH allow you to prove that a piece of data was *not* published.
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Vitalik Non-giver of Ether Dec 10
Replying to @VitalikButerin
3. A simple example is a blockchain university degree verification app I saw recently. A degree is certified with just a digital signature, but *revocations* are put on chain. With cryptography alone you can't check that a revocation was *not* signed; but with a blockchain....
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Vitalik Non-giver of Ether Dec 10
Replying to @VitalikButerin
4. To check that a degree was not yet revoked, you simply scan the chain and check all of the logs of the revocation contract. If a given degree was signed, and the revocation is not found on chain, then that means it's still valid.
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Vitalik Non-giver of Ether Dec 10
Replying to @VitalikButerin
5. You can extend this to other contexts. A big one is key revocation in self-sovereign identity. If you have a key A, then you switch to key B, then key A is hacked later, how does someone you're interacting with no key A is no longer valid? Can check for revocations on chain.
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Vitalik Non-giver of Ether Dec 10
Replying to @VitalikButerin
6. Another category of use cases is verifying integrity of processes. For example, in an auction, you might want to verify that everyone's bid that was submitted on time was included, and no late bids were included. If bids are published to chain, even encrypted, you can do this.
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Vitalik Non-giver of Ether Dec 10
Replying to @VitalikButerin
7. There are also many categories of use cases where different applications need to be on a common database, and it's just more convenient (or less risk of capture) if it's a credibly neutral platform. Supply chain tracing stuff theoretically falls here.
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Vitalik Non-giver of Ether Dec 10
Replying to @VitalikButerin
8. Public blockchains have a genuine competitive advantage over both centralized servers and consortium chains in credibly signaling neutrality. Right now it seems like benefits like this might not be worth the costs of public chains, but that's just the public chains of today...
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Vitalik Non-giver of Ether Dec 10
Replying to @VitalikButerin
9. Blockchains of the future with proof of stake and sharding will be thousands of times more efficient, and so the efficiency sacrifices of putting things on a chain will become more and more acceptable.
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Vitalik Non-giver of Ether Dec 10
Replying to @VitalikButerin
10. Blockchains are NOT about cutting computational costs (at least relative to centralized servers). Blockchains are about incurring a sacrifice in the form of INCREASED computational costs to achieve a *decrease* in *social costs*.
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Vitalik Non-giver of Ether
11. Computers have become 1 trillion times cheaper, per unit computation, in the last 70 years. Human labor has gotten 2-10x more expensive. So incurring high technical costs to achieve reductions in social costs is at least sometimes a very good bargain.
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Vitalik Non-giver of Ether Dec 10
Replying to @VitalikButerin
12. If layer 1 becomes cheap enough I literally foresee things like receipts of everyday purchases being published to blockchains. Because it'll just be the simplest tool out there for achieving the desired guarantees of verifiability, non-double-spending, etc.
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Vitalik Non-giver of Ether Dec 10
Replying to @VitalikButerin
13. Another interesting thing that blockchains give is the value of permanence. For example, an ERC721 collectible that you hold in your ethereum wallet is "yours" in a very real cryptographic sense that would not be the case if it was just stored in a centralized server.
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Vitalik Non-giver of Ether Dec 10
Replying to @VitalikButerin
14. Centralized servers can decide to change the rules later, they can get hacked, or they can just shut down if the company disappears. A blockchain Merkle receipt, on the other hand, is forever.
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zeg Dec 10
Replying to @VitalikButerin
that is a perspective of a "stable" currency, which lost ~90-95% of its value in this time period. i prefer to measure inflation in a litre of milk or a carton of eggs. id argue that human labor still gets you similar amount of milk as 70 years ago.
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Vitalik Non-giver of Ether Dec 10
Replying to @VitalikButerin
15. Non-financial applications have a leg up over financial ones in one important sense: there is less at stake if they break, so fewer reasons to fear deploying them fairly quickly. So they could be the first applications deployed widely, especially in institutional contexts.
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Dmitry Dec 10
And yet the first "killer" application on Ethereum is financial
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Vitalik Non-giver of Ether Dec 10
Replying to @VitalikButerin
Fin (except replies to replies)
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DisRupTion Dec 10
Replying to @VitalikButerin
How come that blockchain adoption within corporate companies is still stagnating ? Though all of them are working with databases ? All of them are highly interested in cutting any kind of costs, be it social or computing.
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Joseph Kennedy Pence Dec 10
Replying to @VitalikButerin
Unless China and Russia decided to team up, take over the majority of the mining, and completely destroy the chain forever. Actually.... That's a pretty good idea, isn't it?
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