Crypto Tokens: A Breakthrough in Open Network Design

Large networks &quot;create&quot; value and cryto tokens are an excellent way to overcome some of the key barriers of network building, and potentially to allocate value to members (users, developers, infrastructure providers) in a better way than traditional centralized networks. Very exciting from all those perspectives; not to mention the innovation that will be unshackled by lowering the cost of entry.<p>That said, I am trying to understand if there is enough value to go around when the network is smaller than (n) nodes? What if the application is not one that will benefit greatly from network effect, doesn&#x27;t have need for the security&#x2F;auth model and doesn&#x27;t need massive compute&#x2F;resources? What if it will never grow beyond a certain number of nodes (for whatever reason)? Note: those are NOT my opinions expressed in question form...they are pure questions that I want to brainstorm and hope that the responses are along the lines of &quot;here&#x27;s how those types of apps can benefit&quot;.<p>Also, at mass adoption levels (while understanding we are nowhere near that, but for the sake of the thought experiment), do we end up with millions of micro-networks, rather than the relatively small number of networks we have today? If so, does the crypto token model still hold up? My gut is it would for the infrastructure providers because they can support (n) networks. I am not sure about the rest of the ecosystem or what constructs need to be built&#x2F;added if that model is to thrive?

I think even if Etherium&#x2F;Crypto Tokens or likewise are the best idea since the typewriter, humans have a staggering way of choosing the worst solutions to problems.<p>I have a bet on for £1000 with a futurist friend that he say with 10 years half of humanity will have made a transaction on a blockchain and I say not.<p>My only regret at this stage is that I didn&#x27;t make the bet in Bitcoin...

The only thing that makes blockchains better than privately owned databases is that you don&#x27;t have to trust a private party. They are otherwise hugely inefficient. For the life of me, the only &quot;application&quot; I can think of that they are clearly better at is if you use them to replace the investment and trading of precious metals.<p>That&#x27;s a huge thing, but in the long run, I think that will be the only thing.

Blockchain-based contracts seem like a useful thing in the abstract, but I&#x27;ve always had two questions that no one has really been able to satisfactorily answer. These might have been answered, though, because it&#x27;s been awhile since I looked into it:<p>1. What about blockchain length? The article kind of alludes to this, but there seems to be this &quot;we&#x27;ll deal with that problem later&quot; idea, even though it seems critical. The answer I always got that chains would fork or be stored distributively but then that suggested the primary use would be in small networks, or that there would be critical problems to solve sooner rather than later.<p>2. Isn&#x27;t a guaranteed decrease in monetary supply a problem? I was kind of under the impression that ideally a currency experiences a small amount of increase monetary supply, to avoid things becoming prohibitively expensive. The process of generating coin seems kind of backward to me in many ways, although I&#x27;m not an expert in the area.

Can someone please explain this to me like I&#x27;m 5? I get what tokens are but I still don&#x27;t understand it.<p>Traditionally say I have a php&#x2F;mysql site, that&#x27;s on a server, say Digital Ocean and files are uploaded to Amazon storage.<p>How does that translate to Etheruem? What about private messages? If everything is public on the block chain, isn&#x27;t that an issue? Does Etheruem run code?<p>Can anyone point me to some reading on this? And how to create a &#x27;decentralized&#x27; social network?<p>This is the future and I&#x27;d like to get a handle on it, thanks!

Whenever it says &quot;breakthrough&quot; I get very, very cautious. Hype? Or really innovative? I&#x27;ll stick to hype for the moment.

Etherium has serious potential as a distributed network, and as a networked means of greatly enhancing transaction and contract efficiency. I think we are seeing just the tip of the tip of its iceberg.<p>Bitcoin concerns me. If&#x2F;when BTC is makes its appearance in the every day lives of ordinary people, its anonymity value will have eroded significantly. Traditional currencies have not yet started to compete with BTC, but they can and they will if necessary. Try getting a mortgage, car loan, business loan with BTC as collateral as one example of where my concerns rest. Look at the grossly inverted price of BTC and gold prices (artificially assuming 1BTC = 1Oz).<p>Before BTC there was growing dissatisfaction with money center currencies that persists today. BTC &#x27;took the edge off&#x27; for many in those circles and may have relieved pressure on gold prices.<p>I don&#x27;t necessarily believe this, but I&#x27;ve read in economic revisionist circles that BTC would be means for certain central banks to redirect some demand and attention for precious metals away from their vaults and toward an asset class they, better than anyone, are capable of mining with their existing computing infrastructure. So, by invention or acquiescence, BTC serves money center interests, for now, but not indefinitely.<p>BTC remains a highly speculative and risky asset&#x2F;network in my mind.

lets assume for the sake of argument some of these platforms aren&#x27;t scams&#x2F;bullshit hype and actually add value in some way. like the prediction platforms augur or gnosis.<p>the main problem, i then see is that if these tokens are required to use the platform, wouldnt their cost be prohibitive? and the platform wont be useful?<p>these tokens are going up in value just like bitcoin which always had actual use (mostly on blackmarket) so their incentives are aligned with the token being used as a currency, but not as an app token that is required for the product.<p>so in effect, these are just over hyped quasi securities offerings and trading.

I think that token networks in general have potential. While its impressive that cryptotokens have proven to be a store of value, as they exist now don&#x27;t offer any significant advantages to cash, except for black market transactions.<p>What i&#x27;m interested in is the ability of token networks to be useful for legitimate transactions between entities. I think in particular there&#x27;s potential for token networks to increase the trust and liquidity of virtual goods. Right now cryptocoins are basically only useful for traditional transactions that cash is already very efficient at. What I want to see more of is using the logging and trust ideas of token network to develop transactions between virtual goods, that normally exist in siloed ecosystems.

There is a lot of talking and linking here that doesn&#x27;t lead to technical resources.<p>Does anyone have a more formal explanation of how blockchain is being used here?