[thawaya3113]

How is crypto any better at doing this than say, Western Union?

Ultimately, as someone who finds blockchain technology really cool, what I struggle with is, in which scenarios is blockchain better than Postgres?

[dcolkitt]

I agree that anything that can be done with a blockchain can technically be done with a database. But the practical challenge comes down to coordination problems. With blockchains you get credibly neutrality out of the box.

Different developers are comfortable building inside a shared execution environment. If Western Union built a smart contract execution system, you'd have a much, much harder time convincing developers to build inside of it than you would on Ethereum. It would be much less likely that Ethereum would shut off, change the rules, ban you from the platform, etc.

The advantage that gives blockchains is composability. Thousands of different applications can instantly talk to one another using standardized calls inside atomic transactions. Databases by contrast are siloed. So they work really well if you stay within the application that database was built for. But really poorly once you try to cross applications, and hence databases. Imagine how hard it would be and how many hoops you would have to jump through to be able to use Venmo to buy Nasdaq listed stocks. In contrast USDC and Uniswap work together seamlessly because they're both built on the same common credibly neutral layer, Ethereum.

[lazzlazzlazz]

This is totally correct and something that devs on HN seem to struggle to understand. There are many theories as to why, but it is an unending source of amusement.

[mNovak]

"credible neutrality" is a nice phrase for a concept I've struggled to articulate, thanks

[randomran01234]

Better by what metric? Ethereum settlements are nearly instant and global, involve no need for a private third party arbiter, and are built on permissionless and open source protocols. Some of the areas they fall short is often around throughput, energy externalities, and user privacy. As the article points out, there are engineering solutions and new cryptography being applied to all three of those problems.

[peyton]

Composability; as a user I can prove things publicly about my assets and other people can offer services independently of the asset issuer. E.g. take out a loan against my bacon coins or whatever, even if Bacon Bank didn’t think to implement a way for lenders to verify my ownership of bacon coins.

[forum_ghost]

Postgres doesn't help with scenarios where you don't want your sovereign foreign reserves seized.