Ethereum 2.0 launches
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The previous official wallet's repository says "Mist and Ethereum Wallet have been deprecated.".
Is it true that the Ethereum foundation isn't providing a wallet software anymore?
Why is that?
I would consider it as quite unsolvable as a user to determine which of the 24 third-party wallets is the most trustworthy, hence I'd prefer to just use one developed by the same people as Ethereum.
I went from mining Ethereum and even releasing a minimal mining GUI for folks who wanted to support PortableApps.com to feeling uneasy about it. I don't even have an ETH client on my PC now, so I can't even access the fraction of an ETH I own. I'll probably ditch ETH donations to PortableApps.com as well.
Well, they received $ 18.3 million in crowdfunding [1], so I would dare to say it's not only "their" resources but also the resources of the community which they're spending, isn't it?
Given that the central thing a user needs to use a cryptocurrency is the wallet it would seem a bit weird to collect $ 18M from their users to develop a cryptocurrency and then not develop the software which the users need to use the currency?
I mean they're a non-profit organization, if they don't hand anything out for the $ 18.3 M then they have profited quite a bit by taking in money but not delivering effectively usable goods from it?
[1] https://en.wikipedia.org/wiki/List_of_highest-funded_crowdfu...
Developing yet another Ethereum wallet when there are so many on the market would be a waste. It’s better for the foundation to provide a list of high quality wallets that already exist.
It's actually quite easy: I opened the websites of all the 24 wallets they list and checked the imprint of each. None says it was developed by the foundation.
> Developing yet another Ethereum wallet when there are so many on the market would be a waste.
> It’s better for the foundation to provide a list of high quality wallets that already exist.
What would you think of me if I raised $18M to build a non-profit children's hospital and then used it to instead build a website which lists children's hospitals which were built by other people, most of which being for-profit companies, some even proclaiming themselves as registered in shady tax-haven countries, and most not even clearly showing where their company is registered?
I personally prefer the role of the EF as a facilitator more than monolithic employer. And they can (and do) do facilitate in more ways than just handing out grants. It's just they experience has shown that helping out this way for wallet development (or even more generically software development) works better.
To add, they did start out providing the software as you say. After a certain point though, their efforts were outpaced by community effort or business opportunities arising in the Ethereum ecosystem. At this point it took a while for them to figure out what new role to take on with their ("our") funds, eventually settling on what they're doing now.
> It's just they experience has shown that helping out this way for wallet development (or even more generically software development) works better.
Does it really work better from the perspective of a user though?
Because as a user I am now sitting in front of 24 websites which look equally "meh" in terms of trustworthiness (fancy design and huge claims), each of them trying to get me to hand out money to their software (that's what a wallet is about!), and almost all of them seemingly being for-profit companies which avoid listing their address.
A single 1 well-known website (EDIT: I meant wallet, not website) of a non-profit would "work better" for me as a user in terms of trusting my choice to keep my money safe. (If I had any, not buying ETH in this situation :)
> To add, they did start out providing the software as you say. After a certain point though, their efforts were outpaced by community effort or business opportunities arising in the Ethereum ecosystem.
Do you notice that you're actually arguing in favor of my point? :)
You say that their efforts were "outpaced", i.e. they failed. That's not a good thing to yield for $ 18 M :(
> Because as a user I am now sitting in front of 24 websites which look equally "meh" in terms of trustworthiness (fancy design and huge claims), each of them trying to get me to hand out money to their software (that's what a wallet is about!), and almost all of them seemingly being for-profit companies which avoid listing their address.
Yes, I guess that's definitely a disadvantage of the ecosystem growing so much. It's great that that happened, but it also means that the EF does not control everything anymore. They cannot advertise just one solution with so many out there, lest they rub someone the wrong way. But they also can't say nothing either. And then it just becomes very confusing with this information overload for beginners (though I think "list of 24 websites" is a bit of an exaggeration; it's not _that_ bad imo [0])
I don't think this is entirely new in the world of software though. Generally you then get to things like looking for advice on forums or word-of-mouth, and then there's a guy like me saying "if you're a beginner only wanting to make transactions on Ethereum, get a Ledger Nano X hardware wallet and use their Ledger Live application". And "if you then want to move on interacting with dApps, use Metamask and connect it to your Nano X".
> A single 1 well-known website of a non-profit would "work better" for me as a user in terms of trusting my choice to keep my money safe. (If I had any, not buying ETH in this situation :)
Well, you would definitely know cryptocurrency is a bit different than a website securing your funds. Someone needs to hold onto the private keys. If you're looking for something similar to a bank, then get something similar to a bank (Coinbase?). But this difference (custodial services, private keys, hardware wallet) definitely adds to the barrier one needs to overcome to get started. I would also argue that "1 well-known website" (or 1 major client implementation that then becomes the defacto standard) does not quite fit into the whole "decentralization" aspect of cryptocurrencies, but not everyone cares as much about that.
> Do you notice that you're actually arguing in favor of my point? :)
You could look at it that way I guess ;) Progress is a function of money, and the EF has more to attend to than just software/wallet development. They could certainly blow through all their ("our") money in a year building a super fancy wallet. Or, as has happened, spend a little to jump start the ecosystem, and then comes along not one but multiple better wallets _for free_! None of "your" money was spent on developing these. Seems like a good deal to me, as now "your" money can be spent jump starting other awesome things that no one is paying much attention to yet.
In my book that's not too far off from an "official" ethereum wallet.
Mmh thanks, well security is more relevant to me, but I nevertheless went to their website.
Apparently it's a browser plugin. That's a big security no-no from my side, too much attack surface - sorry.
Then, if you require P2P protocol compatibility, I would say this issue shows that nobody really cares about alternate implementations: https://github.com/btcsuite/btcd/issues/1661
When Btcd was first released, it was pretty capable, and had lots of development. But it has fallen behind, which makes sense. Why would anybody take the risk of trusting that an alternate implementation when it doesn't decide what bitcoin is, in the end? You may have to patch bitcoind a bit to get your desired interface, but that is much less work than maintaining a full P2P and consensus layer.
It is also dangerous to use you a non-standard crypto library. Check this vulnerability, which was caused by LND relying on the btcd project's library: https://lists.linuxfoundation.org/pipermail/lightning-dev/20...
Does that? What I see here is bitcoind adding a new feature that isn't yet implemented in btcd. The new feature uses a different extension mechanism in the p2p protocol (a new message to signal knowledge of a new feature vs using the existing version message bits in the main p2p handshake). That new version of bitcoind also hasn't yet been released, but I'd imagine that btcd will land a fix sooner to permit unknown message types being sent from its PoV.
> Check this vulnerability, which was caused by LND relying on the btcd project's library
Incorrect. The btcsuite libraries we use weren't related to the bug at all. Instead, the bug was introduced by _new_ code which attempted to convert between the fixed 64-byte signature encoding used in the LN Protocol, and the variable sized encoding used in the base Bitcoin protocol. The resulting signatures _were_ valid ECDSA signatures, but didn't adhere to an additional constraint that the Bitcoin system places on this signatures from a mempool policy standpoint. The signatures themselves were still valid from the PoV of Bitcoin consensus, in that they would be included in blocks.
bitcoind doesn't decide what Bitcoin is either: a recent consensus issue introduced for a period of times in _newer_ versions caused it to potentially fork off the "actual" chain. In this instance, btcd was unaffected along with many other implementations and earlier versions of bitcoind.
If there is any way in which different implementations of consensus-critical code behave differently for the same inputs, it can be used to split the network. If you are running a node implementation other than the majority hash-rate reference client, you open yourself up to be potentially vulnerable during the fork. This remains just as true, if not more so with staking instead of proof-of-work.
You can do things to protect yourself like run ALL implementations and shut down if a fork is detected, although properly setting that up is nontrivial and in the end what value is gained? It very, very, VERY rarely makes sense to have multiple reference implementations of consensus code.
I always hated how wasteful and energy-inefficient mining is. Staking reduces energy costs by many, many orders of magnitude. With lightweight clients in development, it is possible to validate chain using Raspberry Pi.
I hope (but don't expect) that some time in the next 10 years Bitcoin will follow. If not, it's just so much CO2 that could have been avoided.
Right now, most of the mining is financed via inflation. But as this comes to an end, eventually, the cost of mining will be borne by anyone making transactions on the network through tx fees.
Somebody has to pay the electricity bill on all these ASICs.
EDIT: One could try to argue that high transaction costs are not a problem because nobody wants to trade bitcoin, people just hodl it. Cool. But if that's what people will do, then the money raised through transaction fees will not be enough to support a sufficient hash rate to protect the network.
I wrote about all this two years ago already: https://www.konstantinschubert.com/2018/11/28/proof-of-stake...
For 'kill' as in 'stops being big and important' I think it's going to happen relatively soon, mostly agreeing with your article. Bitcoin already lost its past domination in users and total fees paid to ethereum, the only missing part is for eth to actually monetize that by fully switching from PoW to PoS. When eth stakers start making even billions annually while btc buyers lose billions annually to mining, btc losing its first place is only a matter of time. After that, PoW is going to be widely discredited and viewed as obsolete.
I'd like to hear from Bitcoin proponents where we are wrong in our thinking. What assumptions are incorrect? Is there a flaw in economic reasoning? If not, what is being done with Bitcoin to address this existential risk for Bitcoin?
https://www.cs.princeton.edu/~arvindn/publications/mining_CC...
Selfish mining is possible, at least for a short period of a time, but sunk costs are eventually sunk costs and you compete for the next block.
>Figure 2: Illustration of Mining Gaps. Miners will only mine when the instantaneous expected reward exceeds the instantaneous cost
This makes no sense, rational actors generally consider discounted future cash flows, not just instantaneous reward. Perhaps the quality of the paper is explained by the researchers following this strategy and only working on 15th and 30th of every month (when their salaries are remitted to their bank account representing an instantaneous reward).
This also assumes that miners will be holding enough bitcoin that price increases alone will not only pay for their operations but also cover a reasonable interest in their holdings. It's not logical to think this will happen. And even of it does, you'll be left with only a handful of miners.
I see your point but doesn’t sound like a great pitch.
Flash loans/minting, for example, have turned the markets into the ultimate meritocracy. Anyone - rich or poor - can access up to hundreds of millions of dollars instantly to execute any profitable transaction, no human review or approval necessary. Liquidity pools, introduced by Uniswap, solved many of the problems and risks associated with holding thinly traded assets. Smart contracts have enabled any new project’s tokens to instantly have real value, because in most cases new tokens can only be released to the market by locking ETH into the contract in exchange for the new tokens.
These innovations, along with those that are coming, enable a shockingly large number of new opportunities in the finance world to a much larger audience than ever before. It might be a few years before security, market manipulation protections, etc. are mature enough for mass adoption. But the opportunities that DeFi enables will drive demand for ETH, in a way that today’s Bitcoin simply cannot.
What does this mean? If I'm poor (or rich), why not borrow hundreds of millions of dollars to make some highly speculative trade? If it goes well, I win big; if it goes tits up, the lender loses big (not me).
I'm certain that's an uncharitable reading of your comment - please take it in the spirit of "this is what I'm asking you to explain to me in simpler terms," not as an argument.
This means you can't take the highly speculative trade, you can only go for a sure thing. But if you do have a sure thing, you can borrow as much currency as the lender can provide.
But... is it like sports memorabilia at that point, the value is all perception rather than utility and could one day just.. collapse
It's a way of selling BTC for other tokens, extracting and removing its value over time, and instead investing it into DeFi and similar.
Primarily two extremes for how this is done: Centralized, like WBTC (https://coinlist.co/help/what-is-wrapped-bitcoin-wbtc), and decentralized, like tBTC (https://defirate.com/tbtc/)
I always thought the hardwired reward for mining, namely, X btc every 10 minutes, is the cause of Bitcoin's wasting electricity.
The electricity used is roughly proportional to the hashrate, which in turn is roughly proportional to the price of btc -- until the next halving, which I think is more than one year but less than 2 years from now.
These halvings of the reward every 2 years (which occur on a schedule set before Bitcoin was launched all those years ago) will some time in the next 10 years (which is 5 halving, representing a reduction in the reward by a factor of 2 * 2 * 2 * 2 * 2 == 32) or 12 years bring the Bitcoin network's electricity usage down low enough that a reasonable person will no longer avoid Bitcoin out of worry that it is bad for the global climate.
Note that this mining reward doled out every 10 minutes is not a transaction fee. E.g., neither of the transacting parties (i.e., neither the sender nor the receiver) pays it.
So tell me again what will eventually kill Bitcoin.
> Right now, most of the mining is financed via inflation. But as this comes to an end, eventually, the cost of mining will be borne by anyone making transactions on the network through tx fees.
> Somebody has to pay the electricity bill on all these ASICs.
This is just wrong.
If the award available to miners decreases due to lack of inflation they will use less power-consuming hardware.
If that still results in loss due to electricity cost then miners will leave the market until the amount of miners in the market is equal to the amount of tx-fees available.
In other words: This is a market with supply and demand. If one decreases the other also goes down until they're balanced. It won't just make the market disappear!
So even if almost nobody was willing to pay any tx-fees and there was no inflation then Bitcoin would still be running. It may just move back to running in the background on consumer hardware which was bought for other purposes instead of having giant mining data centers.
This also means that mining isn't going to infinitely waste energy:
The demand for energy cannot go higher than the offer of tx fees / block reward.
So there is a finite upper boundary to Bitcoin's power consumption. I think a finite upper boundary is enough to justify its existence, the precise value of such a constant is arbitrary so you might as well not waste your time in arguing if it is too high or too low and instead be happy that there IS a boundary :)
Those tools don't work in this chain death scenario of dwindling hash rate.
https://medium.com/@schwartz4live/invitation-for-community-d...
Congrats to the Eth folks though, this really was a big undertaking.
Doing the same for Bitcoin would be very hard, and if it simply follows Ethereum's footsteps, then it is unclear why even use Bitcoin.
But -- I hope we see this fork sooner rather than later. Bitcoin miners will have no economic incentive to capture back the CO2 produced.
Ethereum is built to a spec. That's why the different client developers had to coordinate their work. This is not the case with Bitcoin. There, the official client is the de-facto spec you have to comply with if you develop another client.
The bigger problem is that the current narrative of Bitcoin heavily discourage hard forks.
Transitioning to PoS would be a social task with Bitcoin, not a technical one. Also note that Ethereum was promised from the beginning to transition to PoS, they just didn't expect to take this long.
ETH is still on PoW and will continue to be on PoW for many more years.
- If people pay high effective tx fees, it's shit because, well, it's expensive.
- If people pay low effective tx fees (through lightning or block size increase or whatever) then, as soon as inflation ends, the money won't be enough to pay for a sufficient hash rate.
This means hash rate will be low compared to the market cap, and the necessary capital for a double spend attack may be worth it.
Maybe it’s all less of an issue because bitcoin will develop a network of trust that can replace the block chain.
But then, why not go with something like Stellar right away.
Bitcoin solves the need for third parties in the financial system. That's it, it's not meant to be some eco currency - never was.
Where's the validation that the current financial system needs to have its energy needs reduced? Bitcoin cuts out the energy requirements of all the countless third parties, for a start.
POS is a joke.
I don't have numbers (I suspect it's impossible to do a true apples-to-apples comparison), but I feel like Bitcoin still likely fails by this metric. I recall reading a year or so ago that Bitcoin was using the same amount of electricity as a small developer nation. I expect the other financial systems use more than that in total, but consider that these other financial systems handle orders of magnitude more transaction volume, and include a lot more services than Bitcoin does.
> We can just use renewable energy sources long term.
Renewables aren't free. It costs time, effort, and energy to build the infrastructure (solar panels, windmills, etc.), not to mention caustic chemicals for some of these, which do have negative environmental effects. Maintenance has costs, as does eventual replacement. The land required to house these production farms also is not free.
Yes, the energy produced by renewables is obviously much much cleaner than that produced by other means, but they still have costs.
https://www.invigorlaw.com/sec-says-cryptocurrencies-bitcoin... https://medium.com/blockchain-at-berkeley/does-proof-of-stak...
The very core of Bitcoin is PoW.
any scaling solution or consensus change that doesn't retain this important feature wouldn't be bitcoin, just another fork. potentially could go from PoW as long as supply is not inflatable it could still be considered Bitcoin (depending on whether users switched to the new version or not)
GP is correct. The Bitcoin community is fiercely conservative, and a proposal to switch from PoW to PoS would be met with about as much scorn as a proposal to increase the total supply.
Ethereum, on the other hand, has never had any strong attachment to PoW -- quite the opposite, really. Switching to PoS has been a major goal since the early days of the project.
What about Ripple/XRP or Stellar? I mean, I'm not a fan of it but they've been doing a non-proof-of-work chain since 2012.
Not true. Cardano has been operational with PoS since early 2020. And it’s staking process is much more straightforward and user friendly.
It doesn't damage the environment if used with solar power or an energy source that isn't damaging to the environment. In other words, it isn't necessary that it damages the environment.
Is it wasteful when you use the elliptical machine or tread mill? It is a tragedy that energy is being wasted in such magnitude in gyms around the world?
"I don't know how to communicate this, or even if it is possible to do so... but the question of justice has concerned me greatly of late. And so I say to any creature who may be listening: There can be no justice, so long as laws are absolute. Life itself is an exercise in exceptions."
As far as smart contracts are concerned; they're hardly "contracts", but you probably already knew that. Even Vitalik Buterin regrets calling them that way [1].
[0]: https://en.wikipedia.org/wiki/Rough_consensus
[1]: https://twitter.com/VitalikButerin/status/105116093269977088...
- Every system will be gamed, no exceptions.
- It is impossible for the architects of any system to imagine all the ways it will be gamed.
That's why it's not possible to create fixed laws that are just. Inevitably someone will find a hack that turns the intent of the law around while remaining true to its letter.
This seems to be what dooms both pure libertarian capitalist schemes and pure socialist command economy schemes. In the former case there is not enough structure to contain exploits and no recourse when someone finds a good scam. In the latter case it's impossible for central planners to imagine the results of their plans when they are exposed to opportunistic economic agents. The fatal flaw in both ideologies is their dogmatism. It causes them to fail to adapt when flaws and exploits in the rule system are inevitably found.
- people aren't assholes
- all involved parties can audit blockchain transactions
- all involved parties are programmers and can audit a contract written in an esoteric programming language
- all involved parties voluntarily agree to be bound by these contracts despite the fact there's no way they can be enforced
I think the current lowlevel framework is fine, because it's allowing different projects to explore how to introduce flexibility back into the system at a higher level -- but because it's being done at the level of a project within the Ethereum ecosystem, each approach can live & die on it's own, without risking the entire ecosystem on one approach.
The main set of coding patterns I've seen all center around deploying contracts which act as an "upgradable proxy" -- an immutable frontend contract, which can be redirected to point to another contract that does the actual work.
This "redirect" usually can only be done via txn signed by an "admin" account, which may be a single anon -- or it may be something more complex, like MakerDAO or Aave.com, where any updates are proposed by the dev team, but have to be approved by on-chain governance votes. Said votes in turn literally have $$$ staked on-chain to properly motivate them to make things work. There are also time-locks on many of these updates, giving users a last chance to run for the hills if governance does something malicious / stupid.
The nice thing about that structure is that it also allows governance to let in updates which compensate users for mistakes or exploits at a meta-level, all without violating the underlying immutability of the smart contract bytecode.
---
It's a pretty rapidly evolving space, and I'm sure what I described won't resemble the final form in even a few years.
I think it's really great to see that there is a way to introduce justice and flexibility on top of an immutable system, rather than making the system itself become mutable. This allows the immutability of the lowlevel system to act as a source of trust between anonymous groups, that they have to act within some immutable set of ground rules, while then re-introducing the flexbility on top, so humans can act like humans when mistakes occur.
Put another way: how good is a smart contract if it’s easy to create a deceptive one?
But establishing agreement with another human means I have to establish a common language with them, then work out what we're agreeing to, then establish some set of mutual trust between us (usually involving some form of identity verification, even if it's a "who are you on twitter?" level of thing). And then we perpetually have to track that the other person's incentives haven't changed outside of the contract in such a way that violating it would be more profitable. The effort involved in all of that scales very poorly, especially from the service provider's perspective.
On the other hand, if someone wishes to operate in good faith, their incentive is to make the smart contract as simple as possible, and as amenable to independent verification from outside parties (as well as theorem provers).
And no one has to worry about establishing mutual trust with the other person, or that they'll just change their mind in the future. Even if a contract is upgradable, if you only choose to work with ones that are either immutable, or require a timelock / voting period before changes take effect, you (collectively all the consumers of the contract) know your margin of safety.
And that margin of safety is provided because you can trust the base layer is itself immutable and secured. Whereas with risk mitigation through bonds etc, who is the trusted third party we mutually agree to hold our deposits? how do each of us trust that third party isn't in league with one of us? (I trust the "Certified Bank of Nigeria In England", but do you?).
That's the core bit that a smart contract platform like Ethereum provides -- a base layer for establishing mutual trust in objective terms. You can build whatever manner of agreements on top of such a base layer, but if the base layer isn't there, each separate agreement (expensively) requires the two parties find some common ground.
At least for any contract in which "everybody" is reasonably defined, known upfront, and finite.
The switch to eWASM would greatly improve security, efficiency and perhaps allow a diversity of languages to be used on Ethereum. It should be a matter of exposing the appropriate primitives to call other contracts, generate log events, write to the store and so on.
[0] For instance, see a PR that reduces codegen from 55K to 1.6K bytes on an innocuous contract https://github.com/vyperlang/vyper/pull/1488
[1] I'm guilty of it too; https://github.com/ActorForth/evm-assembler/blob/master/docs...
https://github.com/ethereum/EIPs/blob/master/EIPS/eip-2315.m...
Your evm-assembler looks pretty interesting. It's crossed my mind before to write an evm Forth, just for fun, and the lack of a return stack so far has dissuaded me.
eWASM does look interesting, though!
Seems like there's discussion of scrapping the whole phase 2 "execution environments" and just allowing heterogenous execution on rollups.
As blockchain tech goes, Ethereum always seemed the most interesting.
Last but not least, full eth2 turns eth into a positive yield asset, a share in ethereum (real income depends on fees paid by users - ethereum already dominates).
To not overhype, the current launch is really an incentivized testnet only for PoS itself - real ethereum still runs on PoW as it was. It's important because it shows that after long delays eth2 is finally starting to happen, and because consensus itself is like a car that can drive without transporting anything or anyone - not very useful at the moment, but changes required to make it useful are relatively small compared to building the car from the ground up.
Uh, why do you say that?
The security of PoS in fact ought to be much LOWER than the security of PoW:
The goal of requiring proof of work is that you cannot just send multiple versions of the same transaction into different areas of the network to double-spend your money - because you need to commit work for producing a block, and due to consuming energy you can't fake that.
Well, you can compute two (or more) blocks in parallel, but then you'll spend half of your available CPU (or ASIC nowadays) cycles on each block, thus cutting your speed in half. So the non-malicious competitors on the network will produce more blocks meanwhile because they're not splitting their computation power, and thus your fake blocks will get invalidated because they're on the shorter chain.
With PoS on the other hand you can create as many fake blocks as you want and spam them to the network. The only security is the hope that the random network topology arbitrarily results in the double-spending blocks arriving at the targets under attack after the other blocks arrive.
But if you run thousands of nodes on the cloud and thus have better network connectivity than the victims you can make your double-spend blocks arrive first at the victims.
So:
- PoW: Relies on physical limits, you need to have physical hardware and physical energy to conduct an attack.
- PoS: Relies on the network connectivity of the attacker being hopefully worse than the connectivity of the non-malicious network. Who can guarantee that? Nobody.
Last but not least, there's no way to delete PoW attacker's gpus, but hostile stake is always going to be slashed. Asic pow chain can be forked - once - to a gpu pow, but that's it, and after that there's no recourse to sustained attacks. This property virtually guarantees that no attack against PoS with slashing is ever going to happen.
What defends against the attacker configuring his nodes to just not relay the blocks which slash his deposits, by having a majority in the network connectivity, and thereby convincing victim nodes that he in fact is the victim of false slashing because the victims will only discover the slash-claims much after the attackers "valid" blocks?
Or in other words:
Isn't the slashing mechanism also reliant upon mere hope that the network topology randomly happens to be in favor of non-malicious peers?
https://twitter.com/technocrypto/status/1330150362427387910
In proof of stake, mining equipment and electricity consumption is replaced by the cryptocurrency itself. You put up your currency as a bond, get rewarded more for running the network, and lose your bond if you misbehave.
The other big advance for ETH2 will be sharding, so each node doesn't have to process every transaction. But that's not the part that launched today.
A new virtual machine for smart contracts (EWASM instead of EVM) giving better contract analysis options, and possibly higher sync speeds due to optimisations.
Also, sharding - so multiple jndependent blockchains, that should fix the scalability.
If I’m not mistaken, this release is not yet a full blown new chain, but just a partially functional one, designed to test stabiloty and safety.
Disclaimer - I’m a bit out of loop, so I meay be slightly wrong somewhere.
The roadmap has changed for the phases after this launch so that Eth1 contracts and the Eth1 chain can run on Eth2 so that the past years of Eth1 development are not thrown away.
Reading on the roadmap: https://ethereum-magicians.org/t/a-rollup-centric-ethereum-r...
Disclaimer, this roadmap is valid as of today Dec 1st 2020 but it might have change a couple of months from now.
I wouldn't mind staying with EVM, since EWASM doesn't seem to offer much significant improvement (static jumps only, really).
- scaling issues (it can't be used as a currency if this isn't fixed) - power issues (would be nice if we didn't create a huge pointless energy sink if we could avoid it) - the amount of footguns in ethereum (I think the language is too permissive)
It looks like this solves at least 2 of the three!
The other part, which is on Ethereum mainnet already, is a layer-2 idea called rollups, which store transactions on chain in a very compressed format without losing security guarantees. There are several rollup systems, capable on today's Ethereum of doing 1000 to 9000 simple tx/sec.
Once both systems are live, total capacity will be 20K to 100K tx/sec, not counting the quadratic improvements.
On the research side, there's also work to make data validation more efficient by replacing merkle trees with something more compact, like polynomial commitments. That would add another 10X factor to rollup scaling.
Regarding footguns, people are working on more rigorous languages than Solidity that still compile to the EVM. So far their compilers aren't as solid so they don't get much production use yet.
Anything more than ~3000 tx/sec will be a game changer and maybe ethereum will finally deliver on the promise of usability as currency.
Not 100% sure what ETH is using here but there is a mechanism.
If someone would want to fake timestamps, they would need to deviate from the protocol and would thus not be on chain.
https://github.com/ethereum/eth2.0-specs/blob/dev/specs/phas...
Here is how they sync: https://ieeexplore.ieee.org/document/8946264
Assuming they describe the BeaconBlocks mentioned here: https://github.com/ethereum/eth2.0-specs/blob/dev/specs/phas...
Also, which effect would an increased difficulty have?
It would seem to be a way to avoid the rich-get-richer aspect because hiring people wouldn't make sense - they'd get more value going it alone, so existing capital has reduced influence.
Obviously there is no nation that backs its currency value for an objectively "good" common cause - every nation probably only thinks within her interest for most of the time. If you want to create such an institution which can print money backed by the values you like - then the answer is much more political than technical, and the crypto algorithms alone wouldn't help you in achieving that.
I was merely talking about replacing proof of work with a human step rather than something computed. Intellectual labour (such as to plug our gaps in AI) moreso than physical. Answer a quiz when you buy a coffee or sit there for a few hours to mine coins while analysing a corpus. Something like that.
I saw that some exist, I don't know how relevant they are.
If it is useful then it won't be secure because it would be free to "hash". The mechanism has to be costly. Proof-of-work is in many ways proof-of-waste. If tomorrow we find out that hashing is profitable then everyone can start hashing and be able to attack the chain for free (subsidized by the usefulness). Only the hash power above the useful level can add security.
Now that the launch has succeeded, I will stake some of my Eth. As more people do that, APR will fall.
Poo, minimum 32 ETH or at current prices $19k. This reinforces my dislike of staking. Only making the already rich richer. Keeping lesser ETH holders out of the profit.
But who am I kidding; if I magically had 32 ETH to stake I'd probably feel differently.
i.e. can an ETH holder somehow delegate a pool to be able to stake with that ETH but not spend it?
You can't do anything with Eth2 that is locked. Some pool staking services offer a token for each ETH staked, but you can not use the staked ETH.
What distinguishes Bitcoin from most cryptocurrencies is that a) It has a (relatively) simple goal -- sound money -- and thus less attack surface; and b) Its community is fiercely conservative, to the point that major changes to Bitcoin (e.g. increasing the total supply) are completely off the table. These properties inspire confidence, making Bitcoin a much safer bet than any other cryptocurrency.
The narrative that is often pushed forward is that they have different use cases. Bitcoin is a limited-supply store of value (analogous to precious metals). BTC blockchain isn't well suited for quick transactions, but it is the blockchain that is the most robust and secure. Ethereum, being Turing complete, provides an ecosystem on which other applications can be built.
Both are valuable because of their universally recognized scarcity and value. If you want to put your wealth in a SoV cryptocurrency, Bitcoin is the clear schelling point.
Ether will remain competitive with BTC, it may even flip it in market cap, but I doubt Bitcoin will ever go away.
Ethereum's mining fees exceed Bitcoin's:
That would mean it has better long-term security prospects than Bitcoin, as security is proportional the revenue earned by validators.
That's why I said that Ethereum's long-term security prospects are better. Its mining fees have exceeded Bitcoin's and with the multi-pronged efforts to further scale Ethereum - that are vastly more promising than Bitcoin's - there is a high likelihood of these fees further increasing their gap with Bitcoin's.
As long as speculation is the main thing going on in crypto, BTC is king, since it is purely speculative, has the best name recognition, and doesn't try to hide that fact.
It's different from a conventional bank account, because there the returns are (theoretically) coming from the bank loaning it to entrepreneurs to buy factory and farming equipment and create value.
You could however be morally against earning interest through others speculating. In that case you could still earn better interest by just by being USDC-sUSD LP on curve.fi.
if one entity somehow manages to control over half to the total ETH tokens, does this enable an attack analogous to bitcoin's 51% problem (which happens when one miner controls over half of the network's raw cpu power)?
Also, see this tweet from Vitalik: https://twitter.com/VitalikButerin/status/130129808602782105...
So even if there was a successful first attack from some organised body that's all the time they get.
I'm not sure that's correct (the tweet doesn't get into any details so I went to ethereum's website https://ethereum.org/en/developers/docs/consensus-mechanisms...)
> The threat of a 51% attack still exists in proof-of-stake but it's even more risky for the attackers. To do so, you'd need to control 51% of the staked ETH. Not only is this a lot of money but it would probably cause ETH's value to drop. There's very little incentive to destroy the value of a currency you have a majority stake in. There are stronger incentives to keep the network secure and healthy.
The keypoint seems to be that if your attack fails your stake gets destroyed so besides the positive incentives (a good stable network working for all) this system also relies on punishing failed attacks.
A 51% staker who just censored transactions could hold out longer. If the problem were severe, the community would have to decide whether they want to manually fork off the attacker. The equivalent for PoW would be changing the hash function.
Gaining 51% can be more expensive to do on PoS than on PoW. If 10% of the tokens are staked, you need to accrue another 10% of the total market cap. On PoW, if the annual inflation rate is 2%, the hardware is good for two years, and half the mining cost is electricity, then the total value of mining equipment is only 2% of the market cap, and that's how much you'll have to spend to get 51%. (If miners are rentable, then much less for a brief attack.)
The community will notice and can decide to do a hard fork of the network where they "delete" the attackers coins.
So the network would have experience a hickup, but the hacker has lost billions of dollars worth of ETH and can't attack anymore.
This is different from Proof of Work & Bitcoin. If an attacker gets 51% of the "mining power" (physical hardware), there's nothing the community can do to "delete" their hardware.
Long answer: The beacon chain _will_ run in parallel until the two chains are merged. Until that time, ETH in the Beacon Chain isn't transferable, so effectively not a separate asset.
However, exchanges are offering Eth2 staking derivatives which they're branding as "ETH2". But it should be remembered that this is a derivative, not a separate M0 asset.
At any point in time, of course, any node or set of nodes can declare a fork in the chain to be invalid and reorganize on another chain. That's what happened with Ethereum Classic and it could happen again. I think less likely unless there's a vulnerability discovered in Eth2, though.
Also less likely because in some ways the Ethereum Classic incident helped cement Ethereum's place by scaring off all the ideologues and keeping the participants who were more pragmatic.
Check out https://ethereum.org/en/eth2/
"What is Eth2?
Eth2 refers to a set of interconnected upgrades that will make Ethereum more scalable, more secure, and more sustainable. These upgrades are being built by multiple teams from across the Ethereum ecosystem."
Wondering if I should invest in the coin itself (which makes sense for deflationary coins) or a company doing something with it (which makes sense for an inflationary coin)
Conventional economists use "deflation" to mean "price deflation" -- that is, the price of goods, on average, decreases over time, as denominated in the currency in question.
Austrian (heterodox) economists often use the term "deflation" and "inflation" to refer to changes in the money supply, rather than prices.
In the crypto space, people often use the term "deflationary" to refer to currencies that do not increase exponentially in supply; or more specifically whether the marginal change in supply is decreasing.
For 1, no -- saying "Ethereum is deflationary" is equivalent to saying "the value of Ethereum will always go up", which is clearly nonsensical, because it's saying that Ethereum is a risk-free investment.
For 2, no, Ethereum is not deflationary, the supply increases linearly, so the supply is always increasing.
For 3, yes, Ethereum is deflationary, because the supply increases linearly, which means the marginal change in supply tends to zero.
Your question about investments seems to be following the implication that if 3 is true, then 1 must be true, since they both use the word "deflationary". That may be the case, but I would hesitate to think that a mechanical system can guarantee an increase in value.
People use "deflationary" for hard-capped supplies, "disinflationary" for uncapped supplies that have yearly inflation rate going down toward 0 (such as with a pure linear emission), and "inflationary" for emissions whose yearly inflation rate stay above some constant greater than 0.
It does make sense if you compare a less inflationary currencly to more inflationary currencies. It's risk free in the sense that the USD exchange rate will keep up with inflation of the USD in the long term.
So you can compare how "inflationary" currencies are by 2 & 3, but not by 1 -- that's not a mechanical effect. Even the most stringent monetarist in the world wouldn't at a minimum factor in monetary velocity into the value equation. And monetary velocity is a behavioral thing that can be mediated both by availability of current and future capital as well as liquidity preferences of individuals viewed in aggregate.
Inflation = value of money decreases.
Sargos seems to be confusing 'inflation' and 'monetary inflation' (increase in money supply).
As a matter of fact, knowing how many ETH will be produced over a given period of time is a question I never managed to get a satisfactory answer to.
There's probably an algorithm buried somewhere in the code, but it's likely not a simple one.
For PoS, issuance is a formula depending on the amount staked. How that works out: https://docs.ethhub.io/ethereum-roadmap/ethereum-2.0/eth-2.0...
If you want to dig into the actual formula, it's explained here: https://benjaminion.xyz/eth2-annotated-spec/phase0/beacon-ch...
Until PoW migrates to PoS, probably in about a year, they'll operate in parallel and we'll have both rewards added together.
A final factor is an upcoming change to the way transaction fees work, which will burn most of the fees instead of awarding them to validators. That will reduce net issuance further, possibly even taking it negative.
So Ether's (in/de)flationary behaviour is a consequence of multiple factors: network consensus participation (mine or stake), network utilisation (burn due to gas fees for using the Ethereum VM), and network parameters (block or epoch reward)
Some people, Austrians define any change in the amount of base currency as inflation/deflation. This is the traditional definition.
However the normal everyday usage of inflation/deflation talks about the 'General Price Level', usually measured with things like GDP Deflator, or CPI. Some way of trying to measure the general price level. All of those measures are imperfect.
By the first definition, both Bitcoin and ETH are inflationary but only slightly so.
By the second definition it is very hard to say because we don't really have a way to measure it.
I don't understand any of it.
I don't understand cryptocurrencies.
I don't understand what problems they really solve.
> "Ethereum is open access to digital money and data-friendly services for everyone – no matter your background or location. It's a community-built technology behind the cryptocurrency ether (ETH) and thousands of applications you can use today."
I can do all these things already.
> Ethereum is a technology that lets you send cryptocurrency to anyone for a small fee. It also powers applications that everyone can use and no one can take down.
I don't have this need ever, to be frank. Who really does, looking at the larger population?
> It's the world's programmable blockchain.
I don't understand what this means. What does this do for real-life applications?
What problem / which problems are being solved here?
In the case of Ethereum, digital scarcity secured by a blockchain enables a turing complete state machine that the world can use. In the most basic terms, this will remove clearing houses for transactions of assets. In the long term this will lead to novel types of assets, and make ownership extremely liquid. Imagine using your phone to buy shares in a recording artist you just discovered, and selling those shares when they win a grammy. Imagine building a stream of passive income based on the shares you've earned in projects you've worked on throughout your life.
As an example, already, anyone in the world can buy property in the US: https://realt.co/
What the web did for infomation, Ethereum will do for value.
For example, in the mid-aughts I was talking with the CEO of a well-funded "semantic web" company about joining. I liked the people and the tech was cool, but I just couldn't figure out how it would turn a profit. His answer was similar to yours, a "what couldn't they do?" answer. Turns out they never found an answer, and got acquired for their technology without ever turning into a real business.
As somebody who used to write software for financial traders, it's not clear to me that removing clearing houses is a step forward. They provide important services. And I'm even more skeptical that allowing randos to trade in opaque, unregulated assets is a good idea. Music industry actors, for example, have decades of experience in creative accounting and screwing people over. Real estate has a strong caveat emptor tradition, and property management companies are not exactly a watchword for fair dealing. So from you description, I'm mainly imagining people all over the world getting fleeced with no practical legal recourse.
As best I can tell, the cryptocurrency space seems hell-bent on rediscovering why strong markets and government oversight exist in the first place. The only demonstrated market advantage Bitcoin has in a decade of operation is in light financial crime like money laundering, capital control evasion, ponzi schemes, ransom payments, and outright theft.
I do hope these technologies turn out to be useful for something. But the "imagine the possibilities" routine worked much better when there was less of a track record. Now I'd rather examine the actualities.
I'm sorry but I really totally fail to see what is appealing about this future hellscape where literally every aspect of our lives is transacted, monetised and profitable. What is good about this? Why is this something to aim for?
This sentence is completely opaque to me. I have no idea what you are trying to say.
> In the most basic terms, this will remove clearing houses for transactions of asset
So I will be able to go to Starbucks, buy a cup of coffee, pay for it with Ethereum and not involve my bank?
> Imagine building a stream of passive income based on the shares you've earned in projects you've worked on throughout your life.
I can currently buy shares in companies I work for. Why is Ethereum different (other than I don't understand it)?
https://en.m.wikipedia.org/wiki/Real_estate_investment_trust
At this point it seems like you've just recreated being a shareholder in a REIT except without all the legal protections.
Since real estate is a physical thing, it needs to interface with the legal system, the recorder of deeds, etc.
The goal of all this is to circumvent the legal system, but it will never happen for anything physical. Won't even happen for ownership of music groups if anyone ever hopes to use a court.
I can do all these things already.
Up until the invention of Bitcoin, there was ZERO scalable way for me @joeblau to send you @louwrentius money the way I send an email. By that, I mean the only thing I need to rely on is a protocol (like SMTP) and you'll receive it.
What problem / which problems are being solved here?
I don't understand what this means. What does this do for real-life applications?
If it's mine, why can't I just transfer the shares straight to you for the listed price (Currently $567.60)? Because there is no platform digital trustless value transfer that will ensure that we both get what we want: Me getting the money, and you getting the shares.
Your central argument is: 'You offer a service to everyone. I already have that service. Therefore you are not creating value'
Vitalik has written some surprisingly approachable pieces on the various problems that cryptocurrencies face. It's not too much of a leap to see how these problems appear in non-cryptocurrency contexts. The value I see in cryptocurrencies is that they must develop robust/antifragile solutions to the coordination problems that have plagued society forever. Even if some problems can't be solved, then there are mental tools for making sense of what's going on.
[1]: https://vitalik.ca/general/2019/04/03/collusion.html [2]: https://vitalik.ca/general/2020/08/20/trust.html
Most blockchains are strictly inferior to a modern financial system when it comes to things like speed and cost of transferring small sums of money - which is the use case that most people have. But, if you are running Wikileaks, blockchain payments are superior because the credit card companies can't decide to stop processing your payments.
Does anyone else need it? Right now, I think the answer is "no". But nobody really needed a Linux desktop either, and 25 years on we have Chromebooks and Android.
Ethereum allows you to upload complex scripts to it, where those scripts are executed by a variety of different nodes which compare results and ensure that the script was executed faithfully. Do I personally need this? Probably not, no. There's a competitive market in cloud hosting and very few circumstances where I would be afraid that Amazon, Google, or Microsoft is going to tamper with my computation, or refuse to execute it. But there are situations in which it is difficult to get multiple parties to agree on a trustworthy host for data and applications, and current political trends point toward that problem growing in significance. Maybe at some point we will want to use blockchain systems to maintain audit trails or even to coordinate our computations.
If these systems can prove robustness and reliability over a long period of time, maybe it makes sense to write the rules for multi-party computations as Ethereum scripts, and it becomes a ubiquitous low-level part of the stack. Maybe everyone ends up having an Ethereum account and we use it in place of the current payment system. Who knows? These scenarios are unlikely, but then nobody in 1995 would have believed that in 2020 both the majority of the world's servers and the world's most popular personal computing devices would run Linux.
Crypto has its good uses, and I've relied on it for my livelihood before (and even wished it wasn't just used as a speculation vehicle) when traditional banking couldn't meet my needs, so it's a very Americentric/Eurocentric thing to assume it's only ever good to speculate on and buy drugs on the Dark Web.
That's it- that's its killer app, it's an alternative to existing money transfer and store of value mechanisms, anything else like "smart contracts" or reduced carbon footprints from better Proof-of-Stake implementations are a nice bonus and worth developing, of course.
https://www.amazon.com/Bitcoin-Standard-Decentralized-Altern...
- Someone lives somewhere that the U.S refuses to bank with (Sanctions)
- Someone who lives somewhere that simply has no financial infrastructure readily accessible and relies on prepaid cards for things like water and electricity (Rural Africa?)
- Some industries are forbidden to use the majority of credit card processing facilities without excess fee's (Adult content for example)
These are examples where one could build processes around something like Ethereum, with the understanding that you are primarily just adding another input to the existing system but with the trade-offs being more access and lower fees but also less protections and greater risk.
It is basically a distributed computing platform designed to handle money, idea is you make a program that handles money, and it runs in a decentralized manner, this way noone can interfere with it, for example you could make a program that tells the users the password to login on a dissident newspaper if they donate something, since it is decentralized the government would have a harder time taking it down. (that is just a simple example, people doing all sorts of stuff with this)
Many of us feel the same about programmable money. It seems pretty interesting, unexplored, and has exciting, scary potential. It seems like a great place to build community groups openly, fairly, freely(in the libre sense). It reminds me of being a kid in the 90s dialing up to the internet and discovering peoples homepages and forums, sharing ideas and playing with new ways of organising and working together, playing and having fun. The ethereum dev community is inspiring to me.
But you dont have to agree that it is world changing, thats ok. I think there is value in it and will work to prove you wrong! We're all on the same side in the end.
Forget about decentralization/transactions for a second and let's take an example of your company transitioning your 401k to another plan. Think of all the people moving this money, all the legal process that it has to go through, all the find print that must be followed, etc. There's a TON of work to move a 401k and the process typically takes months. What if I told you that you could transfer your 401k plan, without the additional overhead of people, and you could do it in seconds? That's Ethereum.
Let's take another example of buying a house. If you've ever gone through this process it takes months to finish, theres tons of middlemen (bank loan process, approval, selling the loan, lawyers to secure the property, real estate agents, etc). What if I told you that you could buy a house, without this overhead, in seconds? That's Ethereum.
The bottom line is our current financial system is based on an army of lawyers, middlemen, banks etc. and large transactions take time and money to solve. With a concept like Ethereum you just don't need any of that, you can transfer large amounts of value instantly and you don't need this army of people.
It is frankly the difference between horses and cars. It's a technological shift that makes previously impossible actions possible.
Everyone just seems to want to use it like gold, to store wealth or speculate with. This is stupid. But alas.
Decentralized finance is already happening. You can take out loans against your Ethereum or borrowing or lend already without a bank or an intermediary like LendingClub.
The orchestration of money and being able to program money is limitless without the intermediary is huge. True peer to peer financial instruments are now possible.
The trust factor requirement is removed from the physical infrastructure and operators.
For bitcoin and most cryptocurrencies, this is used for a ledger of value transactions.
Now we have an way to transfer ownership and value. What the internet did for information transfer, we now have for value transfer.
Ethereum generalizes this with a virtual machine that can run arbitrary computation and store arbitrary state.
A trustless global value transfer machine that requires no PII (which could be regulated, and added as a requirement in compliant applications, of course), central point of trust, or custodian of data. Where the security layer between the service/application/protocol and the end-user is abstracted away and taken care of by the Ethereum ecosystem.
In the phase we're in right now, a lot of applications are related to finance. There is both transformation of traditional finance[0], and the new sector of "defi" that IMO is here to stay and grow but is in the early half of a huge bubble that will burst hard).
That aside, this is enabling a new way to structure ownership, applications and anything between. If blockchain-based currencies and smart contract platforms end up as Orweillan tools of control, or liberating and improving our society, is mostly lot up to developers, teams, and users.
I hope more people get it.
But not not too many too soon, because the infrastructure wouldn't handle it. Eth2 improves on that by magnitudes, so this news is a crucial step.
[0]: Source: Working at a digital asset service provider with some bigger and more well-known financial institutions as clients, and friends in the industry.
Simple solution for illegal/semi-legal activities. Think some goods, money laundering (try to transfer money to North Korea, Iran) even to your relative.
Also, there are some privacy minded individuals as well who would like to pay for things like VPN, domains, servers who don't want to get their account tied to theirs credit card.
Speaking of Ethereum, think of it like digital money + some js function which can be executed on demand. It allows you to make scams like bitconnect. In other words casino / gambling. Really hard to do legally but very easy to deploy casino function to Ethereum. Those markets are huge.
Oddly enough making payments programmable also introduced some of the first bugs in payment programming which raises many issues with the whole concept. In any case, it is all moving forward very fast.
You can lend dollars on ethereum for 4% APR at the moment. That's a good reason to use this even for someone not interested in other functions. The interest comes from borrowers, who are mostly speculators going long on crypto.
https://compound.finance/markets
USDC is tokenized dollar that can be swapped to/from dollars in a bank account on coinbase. Recently it was even used by the US Treasury to transfer dollars to Venezuela.
Lets say I want to transfer some assets to a guy without anyone knowing from any internet connection. There is a demand for this global service.
Crypto-currency faciliates this. You buy crypto with your normal currency. Transfer. Switch back to normal currency. Yes you've endured some volatility in price but the whole operation was done in an hour or so.
So legit business will set up as "Bitcoin Banks" allowing people to trade in and out of them.
It's truly "digital cash".
In person, I can exchange value (e.g.: chocolate for firewood) without anyone interfering.
Online, I can exchange information without anyone interfering (using encryption).
Online, I cannot exchange value without anyone interfering.
Exchanging value at a distance is complicated, because there’s so many different laws, bank APIs, apps, regulations, etc etc. We use middle-man services to simplify these problems for us — but they charge hefty fees. There’s delays, and arbitrary restrictions. All these complications also introduce additional risk (compared to exchanging the value in person).
A single, perfect global bank, or a perfect standard for all banks to follow, would allow me to exchange value online without anyone interfering. However, such a thing isn’t likely to happen.
Cryptocurrencies, if executed well, offer a real pathway to “I can exchange value online without anyone interfering.”
I think that's basically Ethereum.
Oh, also imagine that instead of costing money directly, you instead have to pay somebody to run their car engine at full speed while up on blocks in a garage. Oh, and if they ever stop revving their car engine, somebody else might rev their engines faster/more and then they can steal all your money.
Edit: Apparently ETH 2.0 has reduced the amount of pointless engine-revving.
1. There is $14.17B of value locked in DeFi, so it's clearly useful to someone(and scams don't account for the majority of it).
2. USD is not my primary currency, I'm fortunate my employer agrees to pay me in USDC. The fees are usually around $1.5, previously when I used PayPal fees used to be 5.5% deducted from my side.
3. I keep most of my money in USD, which earns interest around 8% APY monthly on yearn.finance/earn. Contrast with the savings account on my bank which gives me 3%.
I don't trade, I don't speculate. I own a small amount of ETH to pay for fees. If you are from TradeFi you will find it much more useful!
I guess all crypto-currency is an attempt at digital cash. I.e. the ability to send "money" between people who do not trust each other digitally; with secrecy/privacy in manner which cannot be taken away by states/governments/banks etc.
Why people want to solve this problem through a scheme of chained hash-values and mining (which I guess is just padding the data you compute hash-values from until it hits a certain number of 0's at the end), is still unclear for me.
1) Consistent with a specific set of ideals (anyone can issue, what happens on the network is a matter of individual responsibility, establish economic incentives to funnel people into good behavior, finders keepers, etc.)
2) Obfuscated enough that it’s not immediately regulated into oblivion by the existing financial system
Many people on this site subscribe to the ideals in #1, thus the fervor. The CFTC has decided to do away with #2 (in the states) but it took them over a decade.
Have you ever had your property nationalized?
Have you ever had to leave everything behind and start from scratch somewhere else?
Have you ever lost your savings because the government tried to print its way out of debt?
Maybe you enjoy the privilege of living in a country where these are very unlikely to happen. Most people don't.
I think mostly it's for people don't want the government/Federal Reserve fiddling with the value of their money.
Personally, I think monetary policy is an incredibly valuable and important tool, but I recognize that trusting the powers that be to wield it properly is a bit naïve of me.
People buy cryptocurrencies and hope the price rises and they can dump it back into the USD it has always been valued in, before everyone else does the same.
Since spamming forums to inflate the price doesn't work as it did a decade ago, in order to prevent them crashing to the floor, all kinds of nonsense white elephant use-cases have to be imagined/invented.
We all understand cryptocurrencies. (You're just not supposed to admit it out loud.)
At least you are honest.
>ETH 2.0 is finally here and will transform Ethereum as we know it. But what is the philosophy underpinning ETH 2.0? And what is Ethereum building towards? It all starts with the idea that Ethereum is the foundation of a social contract for the global economy.
>Ethereum is a global public good that is open, borderless, neutral, transparent, and censorship-resistant.Ethereum provides a system of property rights, rules, and economic opportunity for anyone in the world with an internet connection. With Ethereum users and builders are sovereign and able to determine their own economic destinies.
>This is important in an age of declining trust in institutions where many people don’t have access to stable systems of property rights or economic opportunity. With this in mind ETH 2.0 was designed with five key principles:
- Simplicity - Long-term stability - Sufficiency - Defense in depth - Full light-client verifiability
>Simplicity - Allows ETH 2.0 to minimize development costs, reduce its attack surface, and clearly convince users that protocol parameter choices are legitimate because they’re easier to understand (key for credible neutrality).
>Long-Term Stability - Although Ethereum so far has favored evolution over stability, ETH 2.0 is designed with the idea that once built, there should be little need to change it for long periods of time - a necessity for Ethereum to serve as public infrastructure.
>Sufficiency - Blockchains must be powerful enough for it to be possible to build trust minimized layer2 protocols on top of it. In order to achieve this blockchains must include an expressive programming language, scalable data availability and computation, and fast block times.
>Defense in Depth - Blockchains must work well under a variety of possible security assumptions. A key way to achieve this is to design the system so that it is as decentralized as possible to prevent faults, collusions, and attacks. And in the case where harmful collusion does take place, it’s important to make it extremely expensive for those colluding and easy for non-colluding participants to recover the system.
>These are the core reasons underlying Ethereum’s shift to Proof of Stake.
>Full Light-Client Verifiability - Many users will only interact with Ethereum through light clients. Thus it’s important for those users to be able to verify that the data in the full system is available and valid, even under a 51% attack (under certain assumptions).
[1] Ethereum is on course to settle $1 trillion in one year more than double the transaction volume of Bitcoin.
[0] https://twitter.com/RyanWatkins_/status/1333588739277414401 [1] https://cointelegraph.com/news/ethereum-set-to-become-first-...
While I understand why you are confused you must understand that many people can't do what you can do and it's not guaranteed you will be able to do it in the future either. Just look at the situation in Venezuela for example. Even in SE Asia loads of people are still unbanked with no way of changing that.
It's an alternative financial system that anyone can hack on and no one can prevent you from using. Many, especially on HN, quickly lose their Hacker ethos and revert to being state worshippers when it comes to the monetary system, for reasons I don't fully understand. But there is a sizable community of programmers around the world that value a completely open, transparent, hackable, and protocol-oriented financial system. Its network effects have allowed it to be greater than the sum of its parts, and novel financial applications continue to be constructed on it.
About your other points: I see no benefit whatsoever in investing my own time trying to teach you about cryptocurrencies.
Think about it as a secret. Act as it doesn't exist and both our lives will be better.
Amateur spaghetti code, even in a good language like Go, will not scale, by definition.
Certain design decisions for achieving scalability should have been adopted from the day one. Basically, it is all the principles behind FP and Erlang - share nothing, in the first place.
Scalability comes from being pure functional. This is the main conclusion from last 30 or 40 years of CS research.
Stateless and share-nothing applies to protocols and services too.
This is why so many failed with so called micro-services - only stateless will work.
Things of the scale of Ethereum require deep CS knowledge. Just being overconfident and too cocky is not enough.
Ethereum is the most heavily used blockchain by far and powers all of DeFi which comprises of digital versions of most of the traditional finance tools. It also powers the entire NFT/collectible space which is used by many games, the NBA, and MLB. The interesting experiments such as quadratic funding and decentralized autonomous organizations are also homed on Ethereum. There's some good overviews out there if you're genuinely interested.