IMO, Ethereum is actually doing a fantastic job at moving itself forward. The issue with Bitcoin has always been the lack of innovation to overcome its fundamental problems. Ethereum isn't afraid to do what needs to be done to become adopted.
Yes, the technology stack is INSANE. As someone who runs a plain text only website, thinks about using Commodore 64s to access the Internet, etc, I can completely ignore the complexity because they are solving an extremely difficult problem.
My hope is when these problems are solved, the teaching and mental model around them will become vastly simplified. Until then, they're in research mode.
Blog post? o.O
My occasional lazy-ass status check: what's the status of non-crypto-collateralized loans at the moment? Can I get a crypto loan to buy a car or house nowadays without having to post crypto as collateral?
(If the answer is yes, I'd be curious to know what aspect of present day crypto makes it competitive to establishment finance.)
To be clear, those products, lending money without fiat collateral are much, much more significant feature of modern financial system than payment settlement. Until crypto solves those somehow, any comparison is meaningless. Like trying to compare wheels with cars.
Services exist to do what you want, but like in fiat institutions the checking process has to be performed "off-chain" in lieu of collateral. If your follow up question is "well then what's the point of crypto?", consider that getting a fiat loan at a bank with collateral still requires human checks in order to ensure that, for example, the collateral exists. In crypto, the collateral check is performed automatically and autonomously, and is therefore immediately more efficient.
Heck, if ownership of other real-world assets was defined onchain, instead of paper, you could post that as collateral. For instance, if the ownership of your house was officially registered onchain, then you could post it as collateral. Because whoever loans you, would know that he would get the official ownership of the asset. Which is for all intents and purposes the same thing that happens when we mortgage our house. Except that with our current systems we involve a lot of lawyers, banks, and notaries, that to a large degree would be dis-intermediated into code. To be noted that, of course, you can refuse to leave the house even if you lose control of its ownerhship, but these happens with both paper ownership and onchain ownership. Both would require the enforcement of private property rights by some authority holding the sanctioned right to forcefully remove you.
I don't quite see how it could be a significant share of workload that would go to code. The parts you can dispatch there just are not that significant in costwaise when running a financial organization.
Furthermore, even the part that could be dispatched to code, won't. See DAO in the early days of etherium.
Last year for the ETHOnline hackathon, I made an app that allows anyone to request a loan in any erc20 token with (optional) collateral in any set of erc20s. In addition, the borrower identity is used to increase confidence: a linked Lens profile and/or verified passport using Coinpassport. The principal is then crowdfunded. [2]
While making this, I learned that Aave was originally called ETHLend and followed a similar model of requesting individual loans but this approach makes it difficult to attract liquidity so when they developed over-collateralized pools, the protocol became much more popular.
It's going to take better identity tools than we currently have. Of course, undercollatorized lending is the basis of traditional banking so replicating it on chain is a massive win for the ecosystem.
There's a few projects working on credit scores on chain: Sprectral [3] and Cred protocol. See this article about using Cred protocol [4]
[1] https://jumpcrypto.com/writing/paradigms-for-on-chain-credit...
[2] https://ethglobal.com/showcase/lwned-75x0f
[3] https://www.spectral.finance/
[4] https://medium.com/chelo-finance/chelo-tech-guide-2-uncollat...
Couldn't disagree more.
Bitcoin evolved like crazy in its younger days - largely removing features in the interest of security. The fact it does one thing really well and has a fantastically simple and clean UI in it's core app is a feature and the reason I prefer it over Ethereum.
I ran an Ethereum full node, but gave up years ago after new versions constantly broke it and it became way too much of a resource hog for an average joe to maintain.
I want a stable and reliable protocol and software, which I can wrap my head around with minimal surprises, and that's exactly what Bitcoin delivers. The risk-averse approach of the Dev team is appreciated, and the update cadence and size of the changelogs are still lean enough to swallow.
Ethereum scratches a completely different itch for me, and that's great. I don't need or want them to try and do the same things.
I'm not into crypto currency but I respect Ethereum for trying to move forwards and solve real actual problems with the field.
In fairness, by some accounts (I can't personally attest to their accuracy) more than 50% of that is already from renewables, eg. https://www.nasdaq.com/articles/renewable-energy-sources-tha...
I do know from experience there are mining outfits that have located themselves where the energy was going to waste anyway.
But it doesn't excuse the huge use of power, and I wouldn't be surprised if over the long term a more efficient algorithm like proof-of-stake displaces proof-of-work. It's basic physics once you can do the same thing for less energy, and technologies more efficient than their predecessors tend to win out.
If by that time there's a popular proof-of-whatever coin with a similar focus, lean feature set and works-as-expected usability as Bitcoin I would definitely consider switching to it!
Edit: To be clear I share your admiration for Ethereum migrating to proof-of-work, my concerns and contrasts in the earlier post are more around protocol bloat and client software user-experience.
It is in effect totally from fossil.
50% is self admitted. The other 50% - if no bitcoin mining then that 50% would go to replace fossil fuels in other places. Saving that amount of fossil fuel
Thus bitcoin mining increase total fossil fuel usage (and it is the total that matters not what each thing does) by the full amount of the enrgy minig uses.
This is a myth.
Energy, in a useable-to-humans form, does not generally "go to waste". Harvesting any kind of energy requires resources (windmills, solar panels, gas turbines, heat pumps, ...), many of them non-renewable themselves, as well as labor, that could always be deployed elsewhere.
https://www.argusmedia.com/en/news/2261931-bitcoin-miners-he...
Some will argue it becomes a crutch incentivizing oil to keep producing, but it's not like the plant was uneconomical or likely to close down before the recapture outfit came along.
TeraWulf is another interesting one - they plug directly into a nuclear plant and help smooth the demand curve off-peak (reactors can't quickly ramp up and down so the energy produced would otherwise go unused / unpaid for). Discussed in this article along with a few others:
https://www.forbes.com/sites/digital-assets/2023/07/04/4-bit...
Fossil fuels have nothing to do with Bitcoin, but rather how countries manage their electricity production. Bitcoin works just as well with electricity produced by renewable energy. And all other uses of electricity (of which Bitcoin is an insignificant percentage), or even worse, uses of energy in general, are also backed by fossil fuels (even more than electricity alone).
So if you're not happy with how your government manages electricity production (or how they're not taxing emissions enough), go ahead and complain to your elected politicians instead of shifting the blame to those who legitimately want to use electricity for their own purposes, which they have a right to, like anybody else who uses electricity.
The truth or falsehood of the statement is irrelevant, it's politically ludicrous.
Carbon prices last exactly as long as progressive governments, not a day more. The moment a conservative government takes power, they're destroyed. They have no moat. And I'm writing this from a country that has a small, modest carbon price.
Since carbon prices are politically impossible, that means that avoiding spending excessive electrical energy on inefficient vanity projects is a matter of personal responsibility.
As I mentioned, no "wasting" is happening. The "wasting" is all in your head. I can assure you that every watt is being used to its capacity (up to the unavoidable physical and other loss limits, like any electricity use).
> is the free-market equivalent
No, it isn't. That's not what "free-market" means. A carbon tax would have to be enforced by a government or government-regulated authority, it wouldn't be done in a free market. Free markets do not price externalities such as carbon emissions.
It's one of the jobs of governments to regulate markets, so that they work as efficiently as possible. In fact, that's one of their most legitimate and useful jobs. Furthermore, governments are the ones who have a monopoly on regulation. So if they are not regulating correctly, you know exactly who to blame. There's no one else responsible for doing that job.
> The truth or falsehood of the statement is irrelevant, it's politically ludicrous.
Well, I don't think that's true, but even if it were, if you keep blaming Bitcoin and similarly singling out other uses of energy as the culprits of carbon emissions, it would keep being politically ludicrous, because there are always people and businesses who would be affected by the demonization of such uses and would feel personally (or corporately) attacked by being singled out.
Which means that the only real, efficient and fair way of reducing carbon emissions is to tax them all equally. Whatever businesses (or other energy uses) stop being lucrative and go bankrupt, are exactly the businesses that should go bankrupt, because they are not sustainable (as long as the carbon emissions are taxed at an environmentally sustainable level and not more).
If you're going to reduce emissions, and practically all developed countries are working to do it AFAIK, then it should be done this way and I don't see why right-wingers or anyone else should object to such a plan, rather than what is really ludicrous, which is to arbitrarily demonize uses of energy, one by one, until you reach a critical mass of users who eventually are going to say "enough is enough".
Now, if your argument is that right-wing governments are in principle opposed to reducing carbon emissions, that's a completely different argument and again, it has nothing to do with Bitcoin. It's a political issue alone and the blame-shifting is not going to solve it.
> that means that avoiding spending excessive electrical energy on inefficient vanity projects is a matter of personal responsibility.
See, here are the problems with that argument:
1. There's no "excessive" electrical energy being used.
2. The project is not "inefficient".
3. It's not a "vanity" project.
4. It's not a matter of personal responsibility either. Once again, that's blame shifting.
Personal responsibility in the way you are imagining it is not going to solve this problem.
It'd be way, way, way, way easier to actually influence a right-wing government to solve it, once and for all, in the most efficient way possible, for the entire population than to change the behavior of hundreds of millions of people individually (especially by writing unconvincing arguments on the Internet).
Adding complexity to solve problems is mere cleverness. Removing it is intelligence. Huge reductions in complexity without loss of function — or even with gain of function — is the definition of genius.
The more complex a solution is, the less intelligence is evident in its design.
I think this is related to how data compression is central to the way intelligence works.
I've seen this in myself and others: There's a certain rush to creating a system so complex that you can barely master it yourself.
But in a real system (one being actually used by people other than its designers, that have interests other than working on it and admiring the beautiful machinery), there is an infinite supply of complexity in the form of external constraints and internal one-way architectural decisions, and you'll be grateful for every single bit of complexity you can still chip off while keeping the system running.
It takes good engineering to solve a problem, but it takes great engineering to solve a problem without creating three others elsewhere.
Yeah that’s basically what I mean.
There’s essential complexity and incidental complexity. The first is the complexity that comes from the real world. The second is self imposed due to design choices or path dependency effects. Minimizing the latter is good engineering.
I do maintain that every once I a while someone finds a way to radically cut complexity without losing essential capability. That’s genius, and it’s rare.
As I mentioned elsewhere, I'm okay with jargon, but it can be difficult to get the dosage right.
I am really not sure it would be better without jargon as each of these terms has a precise meaning.
To me, Vitalik’s brain is like 50 years ahead of the rest of us. I also trust him to speak as plainly and concisely as possible. I get the same rush from reading these posts as watching a great sci-fi film, except it’s not fiction. It’s (mostly) real.
However, when scifi-esque terms flow over into the real world and affect the livelihoods of real people, jargon only benefits the few who have the luxury to dabble in its lexicon. Why not make it as accessible by default?
There's a certain appeal to incredibly complex systems, at least to some people, and there can be joy in going so deep in a complex system that you and your peers are creating, you get to forget about any painful interaction points with the larger world in which it exists and by which it will still always be constrained.
Without understanding this emotion and motivation, it can be baffling to see where the ideas of crypto take people, because at face value, it just doesn't make a lot of sense sometimes.
When you don't understand it, it seems inscrutable and anyone who does seems like a genius.
When you understand it, it becomes boring and often trivial.
I can assure you that Vitalik isn't some kind of Uber genius who is 50 years ahead of everyone. Not even Einstein was, and he was much farther away than Vitalik is.
You can enjoy it as some sort of entertainment, but don't extrapolate it too far.
Besides-which: All of crypto use obfuscated technical and communal terms all through all their material, documentation and writing. Some of this is because the underlying tech is very complicated and the discussions of it's politics are also by virtue of that, some of it is because they like their technobabble because it makes it seem more interesting than it actually is and lends it authority from people who don't know any better, who are their best new investors.
Edits: I swear you could strike text on here but it seems I can't figure out how.
Edited edit: thank you kind stranger
[1] https://capitalizemytitle.com/strikethrough-text-generator/
I see this criticism often, usually leveled at either crypto or AI, even though literally everybody else does this too. Try reading a random excerpt of Intel's X86 architecture manual, the C++ language specification, or even a random physics paper off arXiv. If you're not well-versed in any of these subjects, you will probably understand very little.
If you think that all systems need (or even should) be understandable before being widely deployed, I'd argue crypto is still simpler than what we already have.
In this way, what's sold as this regulatory and authority bucking system is not only not doing that at all, it's if anything, even EASIER for people who aren't you to see what you're doing. The only way to engage with any of these products and keep your anonymity is to do so basically with either your own code, or ways of accessing the chains that are HIGHLY technical.
So which is it? Is this trying to be the hobby horse of gambling-addicted tech bros, or is it a replacement financial system that enables transacting business without governmental or legal oversight? Because it can be one of these but it can't be both, and frankly, BOTH suck in their own ways.
Yeah cults love their lingo, that's how you can tell they're cults. All this overspecialised vocabulary, and of course a massive reliance on endless recruiting which crypto achieves through FOMO and stuff like 'ngmi', 'stay poor' and all the usual BS that cults use.
Bitcoin, I think, achieved a purpose. The latter cryptos... I mean, when you look at some of the stuff they're including and their complexity, they seem to have been written entirely for the purposes of scamming people and obfuscating the fact they're being scammed.