I feel like I'm missing something. The innovation of Bitcoin, which I grant is interesting, was in solving the game theoretical aspects of maintaining a trust-less distributed public ledger. It could be relied upon and used by anyone, and was under the control of no individual or group of entities.

The core of the game theoretical solution was the creation of a digital token which (miraculously) was purported to be useful as a general purpose currency. (i.e. it could at least theoretically have value, and built in scarcity.)

To take control of the distributed ledger would require the expenditure of significant resources, and the ultimate result would be the attacker would gain some control over the ledger. If the attack was successful enough to do this, the assumption is it would destroy the value of the currency, which the attacker needs to stay high to realize any return on the attack.

Somehow Satoshi and early adopters bootstrapped this system early enough, and did enough social engineering, for it to take off.

It's not clear that the value of the tokens needs to stay high to provide incentives to the miners to continue mining. A catastrophic loss in the value of bitcoin would cause the shakeout of many miners. But the system might remain as secure as before. Meaning, I don't understand if the incentive system works to maintain proof of work method for maintaining the integrity of the ledger, if a token does not have significant value, in another realm.

The problem I see with other blockchain systems, is that the bizarre economic speculation we see happening in the crypto currency space needs to happen to boost the price enough to make it worth mining.

I could see a privately used blockchain being used between largish entities that are "frenemies." For example financial institutions the don't fully trust each other creating a pool of entities that incentivizes the members to act collectively to prevent cheating. In that case, it's using the cryptographically secured ledger as the "truth." Kind of like using a permanent escrow service. I have no idea whether this is an efficient way to solve this problem. Do banks really have disputes about the actual value of accounts relative to each other that they currently have no simple way to resolve?

This case would not need the tokens, and would not need miners. It would be a way of distributing the trust aspects to a wider group, but not to the public.

In the wider world my intuition is that a successful, trust-less, distributed ledger requires the kind of current fantastic waste of the who crypto-coin proof of work system.

If a given crypto currency project can't get their public blockchain to be secured in a pretty damn close to trust-less manner, the vexing problems of trust, when it comes to keeping track of debts and assets on distributed system, are not solved.

To see the problem with Bitcoin, think about the actual cost per transaction, if you include mining costs. I remember seeing estimates of $30-$50 per transaction. That is horrifying, because the majority of that cost is wasted electricity. Currently, the majority of the cost of a bitcoin transaction is being borne by either the miners, or the speculators who are required to keep new money coming in to the system. (Otherwise, miners selling their block rewards could crash the price.)

So, I think there is a great confusion in "marketplace of hype". The hype, the "sizzle" comes from the dramatic climb in price of Bitcoin and cousins. Since it became clear to the hypesters that Bitcoin had virtually no utility as a currency, they decided to extract the "blockchain" element to carry the expectations of investors. Bitcoin and the like do have real utility as an almost perfect vehicle for pure speculation, for which there is perennial human demand.

I would love to hear if someone can point out something I'm missing here!