A blockchain is as trustworthy as the 51% majority of its CPU power. Unlike the bank CEO, that power is faceless. You will likely never find the guys who cleaned out $18 Million from the Bitcoin Gold accounts, because, unlike a normal bitcoin user, they know how to stay anonymous.

The trouble is not that you have to trust 1000 CEOs. You don’t. In the ideal world, you would only need to trust that 501 of them are honest. Not any specific 501, just any random 501 of the 1000.

In real life, you need to trust the — however many — CEOs that own the most CPU power on the network. Of those 1000 CEOs, they are probably 5, plus 10 mining pools that contain most of the remaining 995. Of those 5 CEOs, one is a crook, running a global botnet. If his botnet has enough computing power, he can ruin everybody’s day, and it doesn’t matter that the other 999 CEOs are trustworthy.

You might argue that the same is true with a bank — but it is not. Iceland has demonstrated that it is possible just to put your bank CEOs to jail when they screw up. Everyone who works at the bank is vetted and can be found. Your money is insured. (And overspent 6 times, etc, but this could be regulated if we, the people, wanted it. It is kind-of obvious that we don’t.)

We have one system that currently mostly works, except for countries with crooked governments — and one that currently doesn’t, and looks like it can’t. I am sincerely not sure which one is the lesser of two evils.

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Science Fiction, Tech, sarcasm, and philosophical ramblings about the Universe.

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