The challenges of cryptocurrencies

[Humaniq.co]

Long read, and full disclosure that I'm a representative of Humaniq.  This article was primarily written by our founder, Alex Fork, who's a friend of Vitalik Buterin and has drawn a lot of inspiration from his work.  I say primarily because I'm the communications expert, or so I think, so I've edited some parts for clarity and brevity. Hope you enjoy the read. If you're interested in finding out more, there are links in the article. 

https://medium.com/@humaniq.ico/the-challenges-of-cryptocurrencies-3d78591941a6#.qi7baxxoi

Excerpt: 

Challenges of the Modern Cryptoeconomy

A significant number of financial and technology (fintech) thought leaders believe that virtual currencies represent a serious phenomenon that is already changing how traditional finance and banking works.
However, cryptocurrencies have noticeable challenges both at the technical and the social level, so let’s dive in.
- The first problem is the desire of nation states to control who gets to play in their financial system and, consequently, to counteract (or not validate) cryptocurrencies at the state level. This is the cause of many recurring legal issues associated with cryptocurrencies.
- The second is technical — there is a high degree of complexity associated with Blockchain scalability that eventually could lead to entire system collapses. The main challenges include: vulnerability to DDoS attacks, Blockchain size, and bandwidth TPS (transactions per second).
- The third problem is the architecture of consensus: PoW leads to mining centralization and technological centralization, PoS makes it possible for the attacker to maintain parallel block chains without high costs. I know many of you would love to jump all over this simplistic explanation, but we don’t want to dive all the way down the rabbit hole today.

[Fuserleer]

Not a bad article, but it mirrors a lot of what I've been preaching for the past 3+ years now, especially regarding the following:

- The first problem is the desire of nation states to control who gets to play in their financial system and, consequently, to counteract (or not validate) cryptocurrencies at the state level. This is the cause of many recurring legal issues associated with cryptocurrencies.

- The second is technical — there is a high degree of complexity associated with Blockchain scalability that eventually could lead to entire system collapses. The main challenges include: vulnerability to DDoS attacks, Blockchain size, and bandwidth TPS (transactions per second).

- The third problem is the architecture of consensus: PoW leads to mining centralization and technological centralization, PoS makes it possible for the attacker to maintain parallel block chains without high costs. I know many of you would love to jump all over this simplistic explanation, but we don’t want to dive all the way down the rabbit hole today.

All difficult problems, but I think the first will take the longest to be "solved", unless a hand is forced.  The best way to force that hand is for a project to achieve rapid mass market adoption, and I mean true adoption here; the 15M users that Bitcoin has is NOT adoption.  With a rapid influx of users over the short term, there will be no ignoring the fact that these regulatory issues need to be solved asap.  A bonus here is that the regulations would probably be a lot softer, as there's now 100's of millions of consumers to keep happy too.

But then it becomes a chicken and egg problem, the tech we have currently can hardly support 10M users, let alone 100M+ consumers.  Until we have tech that can scale, is efficient and easy to use, mass adoption of that magnitude won't happen, because it can't happen.  At best the tech will be bastardized with private and permissioned restrictions and hidden away in the back end of a bank.  That's not adoption either in my book as the USP of this technology is to give people a choice not to use a bank, NOT give the bank a more efficient system to decrease their OPECs and increase profit margins.

Which brings us to points 2 and 3.

There are a lot of people looking at solving one or both of these at the moment, myself included.  Seeing as you bring them up, what efforts or solutions does Humaniq bring to that table?

[Alex Fork]

 Seeing as you bring them up, what efforts or solutions does Humaniq bring to that table?

You can have a look at our Whitepaper here: https://humaniq.co/#whitepaper

I think that it could be bio-identification based concept. Something like "Proof of Human".

[Fuserleer]

 Seeing as you bring them up, what efforts or solutions does Humaniq bring to that table?

You can have a look at our Whitepaper here: https://humaniq.co/#whitepaper

I think that it could be bio-identification based concept. Something like "Proof of Human".

Hmm, that whitepaper doesn't seem to address anything that your colleague talked about in the OP

[Humaniq.co]

Seeing as you bring them up, what efforts or solutions does Humaniq bring to that table?

You can have a look at our Whitepaper here: https://humaniq.co/#whitepaper

I think that it could be bio-identification based concept. Something like "Proof of Human".

Hmm, that whitepaper doesn't seem to address anything that your colleague talked about in the OP

The article itself is one of the chapters from the white paper, with edits for brevity.  

So, regarding the scalability, aka the Transactions Per Second problem, we think that a temporary fix is likely to use blockchain currencies like BitCoin as a sort of reserve that is used to resolve a smaller number of large transactions that are achieved by bundling large numbers of small transactions that use alternate cryptocurrencies that are built on architecture that can handle the bigger scale necessary for true ecommerce.  Bitcoin used for transfer payments rather than Bitcoin being used as the primary transaction currency.  

This isn't actually a problem that we're trying to solve, we were just highlighting that we understand the challenges facing cryptocurrencies. The main problem Humaniq is trying to solve is how to make it simple and easy for people with no access to traditional banking services to join the global economy.  Most of these people don't have a PC that can handle the ledger, so a mobile wallet that connects to a PC account is useless to them.  This is where the biometric identification comes into play.  For cryptocurrencies, all we care about is that a person is the user who owns the tokens necessary for whatever transaction they're engaging in.  We don't care if they're Mike Smith from Green Bay or Siju Adekunlewe from Cameroon.  What we want to do is create a network of users who can start an account just by using biometric identifiers, and secure and verify their transactions using blockchain crypto.  The whitepaper gives a full breakdown of our plan for distributing tokens that these users can use to trade for more transferable currencies.  

I think that your project is interesting, and we do hope that you're able to make progress with the technical challenges that you're working on, because it will benefit us all if we can solve the scalability problem.

[tripwirearmpit]

 Seeing as you bring them up, what efforts or solutions does Humaniq bring to that table?

You can have a look at our Whitepaper here: https://humaniq.co/#whitepaper

I think that it could be bio-identification based concept. Something like "Proof of Human".

Hmm, that whitepaper doesn't seem to address anything that your colleague talked about in the OP

Because they are on two different planets from the look of things 
Anyway, that humaniq ico looks bad so im not investing any there.

[Alex Fork]

so im not investing any there.

We have already reached the minimum amount on pre-ICO. And you are still welcome to join us =)

[HCLivess]

So many logical fallacies here I want to puke. You compare yourself to mighty Vitalik? Thou shalst be banished from this realm

[Humaniq.co]

So many logical fallacies here I want to puke. You compare yourself to mighty Vitalik? Thou shalst be banished from this realm

The founder of our project is an associate of Vitalik, by the way.  We're not trying to lean on name-dropping too much, but he is aware of our project and he did retweet our announcement.  In the white paper, Alex referenced one of Vitalik's more influential articles.  Referencing someone is acknowledging they have valid information that you find useful. Yes, Vitalik is mighty.  If you're working on an Ethereum based project and you're not referencing his work, then you're probably doing it wrong.   

We achieved 83.3% of our crowdfunding goals in the first 12 hours.  We'd like to thank everyone who has participated and we're really excited to move forward with this.

To get in on the ground floor of something cool (Humaniq), please visit our crowdfunding site at https://cyber.fund/system/Humaniq


Our crowdsale wallets:
Ethereum - 0xa2c9a7578e2172F32a36c5c0e49d64776F9E7883
Bitcoin - 1JwkMP7eoqjg5rEG3vGuub8h5k3orPkpTf

Thanks for being awesome ladies and gentlemen.

Here's a 4 page brief that I've condensed from our white paper. People may find it easier to understand the project from this. 
https://docs.google.com/document/d/1jXcbUwZDxOz63e7jjPY2eBg4ii7hv25n9STvd_JnGzE/edit?usp=sharing