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This was extremely helpful for helping me understand the app/protocol difference and why it’s so important in the case of bitcoin and blockchain tech. It also highlights why this is a fundamental shift in the architecture of the Internet and applications built on it, and why that matters. Must read.
“This relationship between protocols and applications is reversed in the blockchain application stack. Value concentrates at the shared protocol layer and only a fraction of that value is distributed along at the applications layer. uniswap ’s a stack with “fat” protocols and “thin” applications.”
Naval explains how coins can be used as a fifth protocol in machine to machine communication for the exchange of value, to weed out transactions and other demands on data that can be costly in huge quantities. It could be used to prevent Spam, DDOS attacks, etc. and even let machines operate autonomously among each other (such as a vending machine ordering its own restocks).
“Cryptocurrencies are electronic cash, and as such, will be used by electronic agents to exchange value, verify contracts, and track identity and reputation. All of a sudden, the computing resources spent by the Bitcoin miners doesn’t seem wasted – it seems efficient, given that it can be used for congestion control and routing of other network resources.”
Homepage: https://www.youtube.com/watch?v=cS6yYIASZZU
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