All transactional system's states are derived from the "list of transactions" and All transactional systems support enough transparency to generate a variety of consolidations, control totals and 'state variables' with which to verify agreement between various input and output sources.
This is simply not true. All transactional systems (= monetary systems) are SUPPOSED TO DERIVE from a list of transactions, but not all of them have as atomic data, the transaction list. In fact, ONLY crypto has this. It is what sets crypto apart from other monetary systems. ALL other monetary systems I know off, are "state" based ; crypto is "transaction based".
Gold is state-based: you HOLD the gold or not. You have a balance of gold. There is no memory of the gold transactions as "fundamental atomic data". There is the "balance state" as fundamental atomic data: how much gold do you own ?
Now, with gold, one counts on the laws of physics to certify that this balance state is DERIVED from transactions: that you cannot "double spend" gold, and that the only way to "create" gold possession, is to dig it up, make it by nuclear transformation, to get it from space or to have it made from lead through the Stone of Wisdom, all of these ways to "create gold balance" being accepted as legit.
Very similar with cash. The fundamental data of the cash system is "who holds what cash ?". Again, one counts on the laws of physics that the state of cash holdings is derived from transactions, and that the origin of the cash is legit (printed by the FED), done by checking the bill physically, and counting on the fact that counterfeiting is severely punished, so that not many people do so and get away with it.
With bank accounts, again, the fundamental state is the holdings of the bank accounts. However, this time, there is no a priori guarantee that the state of bank accounts is derived from transactions or legit creation, as the contents of computer memory in bank computers has no intrinsic method of being derived from transactions. The software that is supposed to do so, can always be modified to do otherwise, and there's no way to make sure. THIS is why accountants are necessary, to check this.
What is checked, is whether the "state of bank accounts" is derived from a possible set of legit transactions.
With crypto, this is meaningless. The fundamental data IS already the list of valid transactions. The state is only derived from that, locally, and without any authority. The only thing that has authority is the list of transactions. So there's NO POINT IN PROVING that the balances are derived from a list of transactions, because that's what you do when you calculate the balances.
If I have access to a wallet application that reports to me I have a "valid transaction" and simultaneously have access to, say, a block explorer somewhere in random cloudland that is tallying all the outputs for a given address they may agree or disagree.
That's silly. If you and that block explorer in cloudland differ, then there are only 3 possibilities:
1) you and that block explorer are looking at DIFFERENT BLOCK CHAINS, at different lists of transactions
2) your wallet application is buggy
3) that block explorer is buggy
If your wallet and your block explorer are working correctly, and are looking at the same block chain then of course they find the same balances.
This is as ridiculous as saying that "if I have a common list of numbers, which is shared by a cloud server, then in order to check the validity of that list, I make the sum of those numbers locally, and I ask that cloud server to make that sum. If the numbers agree, then the list of numbers is good.
Of course not. IF you share an identical list of numbers with a cloud server, and both of you make the sum, then of course both of you will find the same number. If not, the lists weren't identical, or one of both summing operations was buggy. Nothing else.
In other words my wallet may report that I have a valid transaction and the balance may or may not have moved. Assuming the blockchain is working as advertised, that tells me that either I've got a dodgy wallet or a dodgy block explorer.
Indeed. And that doesn't matter, in fact. What counts, and the ONLY thing that counts, is that your valid transaction is on the block chain. What your wallet may think, what the block explorer may think, and whatever erroneous calculations you may do doesn't matter: the right thing happened on the block chain, and everybody using correct software will be in agreement with the transaction as you intended it. No double spending will be happening, no false creation of coins will have happened - whatever your faulty software may tell you.
Simply saying to users "ok, you've got a valid transaction, now f*ck off" is not enough. A system with such limited audibility is unlikely to engender the public consensus and resistance to huge confidence knocks thats required to get through what bitcoin had to go through in its first decade because it doesn't only have to support it's own integrity but also that of a host of client technology of a vast range of quality and origin.
As the only data that matter, are the block chain transactions, you using faulty software to misunderstand those data has nothing to do with audibility. You seeing that web sites use faulty software doesn't matter. In the end, the block chain is what counts and nothing else. With balance checks you cannot check the block chain because there are no balances on the block chain, you can only DERIVE balances FROM the block chain.
However, you CAN check the validity of transactions. That's what nodes and miners do. If ever non-valid transactions are included in the block chain, in any case the whole thing failed and the crypto is dead. So the only thing that matters is that the transactions are valid. In as much as the principles of the checking are correct (whether the bitcoin way, or the cryptographic monero way), then that's all that is needed. And if the *principles* are faulty, then the whole coin is dead in any case.
So in the end, the mathematical principles are sound, or they aren't sound. If they aren't sound, then the whole thing is dead. If they are sound, then you can check them, and that is the ONLY necessary and sufficient check that there is to it.
If I build a brick wall and and counted the number of levels as I went along, I should also be able to measure the wall height and divide by the brick thickness as an alternative to check on my previous result. The number of levels remains the same in both cases, it's just my measure of it I'm checking.
Ah, I guess you regularly check Pythagoras' theorem too ?
(P.S. Gold does not have privacy or obscurity "built in". Any privacy that gold holders enjoy is extrinsic not intrinsic and the fact that a vault "hides" the gold does not make the vault any more valuable
)
Of course gold has privacy and obscurity build in. There's no way for you to check the world's gold balances. You only know how much gold YOU own. There is even no transaction history anywhere. Nowhere there is a centralized ledger with the balances of gold ; let alone a ledger of all gold transactions. The ONLY thing that you can do with the "gold system" is to look how much you own. You don't know how much gold your neighbour has, how much Putin is holding, how much gold Bill Clinton holds, and there's no way for you to make any "balance check" to see whether the amount of "spend gold" and the amount of "received gold" are in agreement. What you are complaining about with monero, you cannot do it with gold. You know that the balances check because of the laws of physics. You know that the balances check in monero, because of cryptographic properties.
That has never undermined people's trust in the value of gold.
