Make Ethereum Cypherpunk Again
vitalik.eth.limo
vitalik.eth.limo
Haha no, the number one culprit is that 99% of blockchain projects are either scams, bullshit, not actually decentralized, or simply fail despite pulling in vast amounts of funding (sometimes more than one of the above!).
However, I do agree that most--if not all--problems in the cryptocurrency space arise from the "currency" aspect. Just not so directly as "transaction fees".
From day one Satoshi had a road map to scale BTC to Visa-like levels while keeping TX fees around a penny. Just incrementally increase the block size over time.
Soon after Blockstream's Greg Maxwell and Adam Back hijacked the Bitcoin Core GitHub repo they locked down the block size to 1mb, something Satoshi and the original devs never imagined anyone being dumb enough to do let alone intended.
Bitcoin Cash (BCH) stayed with the road map and has worked great with low fees for over a decade now. BTC twisted itself into a digital ponzi scheme for morons.
Doesn't this point to Bitcoin's decentralized nature being largely smoke and mirrors?
You're claiming that just two individuals have had a significant negative impact on a project that was intended to be free from central control. That in itself seems like a failure of the project's goals.
Blockstream was able to create the perception of an economic majority — thanks to forums like Bitcointalk and Reddit (moderated by one guy: Theymos / Michael Marquant).
In reality, a lot of people didn’t support blockstream, but through censorship and permanent bans, a few people were able to create the perception of economic majority.
They didn't just control the repo, but they somehow managed to convince the miners to support them. Exchanges and users simply defaulted to "the longest chain is Bitcoin", ensuring their victory. So they weren't alone.
But Bitcoin's truly decentralized nature allows for forks, where if you disagree with the development direction you can always go your own way. So the spirit of Bitcoin lives on in other projects (both via forks and via projects with no shared history with Bitcoin).
> You're claiming that just two individuals have had a significant negative impact on a project that was intended to be free from central control. That in itself seems like a failure of the project's goals.
Yes, it was (and is) still a major failure of the project's goals.
Similarly bitcoin is decentralized in that “anyone can fork it” but reality is without backing from major players, that will never gain any traction at all.
So no, functionally it is nothing approaching decentralized.
At the crucial point they did however convince the miners to support a Segwit + blocksize increase, which pulled away the support.
Of course, it's obvious that it was just a bait-and-switch and the blocksize increase is nowhere to be seen, and will probably never happen.
Ultimately, miners would only support a hard fork if a super majority went along with it and with the major forums being censored that was going to be impossible.
Without the censorship there would have been a super majority supporting the hard work given the sentiment on the forums at that time.
Also in the end it doesn't matter what is in the Bitcoin Core github. It's a network and you can run any variant you want. Bitcoin Cash tried and failed, because in the end it is not what the users, the node operators, chose to adopt.
I believe most people call this bcash.
And those who are clueless and just follow the hivemind.
It still lives on as an uncensored subreddit where all forks of Bitcoin may be discussed.
And focusing so much on a subreddit that's not tied to the project no more than r/bitcoin is to Bitcoin, while dismissing it's existential reason as "irrelevant", is tiring.
Only counting "everybody" as people on your side is common in cults, but is rarely indicative of the real world.
You can make anything in the world but if you have transaction fees that high every single time that project will be guaranteed to fail.
But generally I agree with you, the fees are a big problem.
Shopify and others are now using SolanaPay to do USDC transactions and they settle in under a second for under a cent. It takes a very beefy server to run a Solana validator, though, so many worry that it’s insufficiently decentralized.
I suspect that in the longer run, most of the value will be stored on Ethereum and compatible chains while most transactions will be done on Solana and newer chains.
eth mainnet is lindy as the most secure settlement/data availability layer, other layers for execution settling back to mainnet or other da layers potentially solve settlement fee/l1 data writing rent issues
They're not yet production ready though. All use centralized coordinators and failsafes, as a precaution against catastrophic flaws in the smart contracts they have deployed on L1, that could lead billions of dollars worth of digital assets being stolen/lost.
I find those to be worthless usecases to society in general, but they are usecases.
The higher the transaction fees, the more validators earn. There is no incentive to build tech which will lower transaction fees, even though it would enable practical use cases. Ethereum community is not interested in value creation because they know that value creation doesn't pay. They can earn more money just monopolizing media attention, attracting new investors and lobbying (aka corrupting) politicians.
Having worked in the industry, I've witnessed how they literally suppress innovations which would result in more scalability and lower fees. They only embrace solutions that are flawed by design to create an illusion that they're trying. Billions of dollars are literally wasted just to maintain the illusion.
I don't know where all that money is coming from. The crypto folks are clearly right about one thing; the monetary system is broken... But they seem to be making more money keeping it broken than fixing it.
Not really. 95% of the gas fees get burned and do not go to the validators at all. Only the 'tip' or 'priority fee' goes to the validators and even that is barely anything. Most of the transaction related income validators get is from MEV - basically bribes to order transactions in the block in a particular manner allowing arbitrageurs to extract additional value. These bribes are somewhat correlated to the level of the gas fees, but not always.
Since supply of compute is inelastic, it means that demand for compute fully determines fees + MEV. Any effort to scale the network would result in supply elasticity and would therefore cause fees + MEV to drop which would go against the interests of those who provide the validation service and earn the fees + MEV.
False until proven with sources. I'm involved with ethstaker and follow core development closely and have never seen anything like this.
This line stood out to me and is sad to see.
I think this has a slightly ironic benefit in practice: by paying out in-kind, as it were, you inherently filter for participants who actually are after the functionality provided by the distributed system and aren't just out to make a quick buck, which leads to a better true believer:huckster ratio. Reminds me of how capitalistic incentives don't always translate to good content: see cooking recipe / other SEO blogspam, or capeshit. Scene respect is the sort of in-kind pseudocurrency that, while not without its own flaws, ime incentivizes better art.
Trackers and crypto are popular because they offer utility to users that you don’t find in centralized systems. You can even see the popularity of trackers shift as centralized services like Netflix appeared and then got worse. Crypto is all about ‘degen gamblers’ but as a result has oodles of cash, that in turn they’ve been spending hand over fist on marketing to get in more greater fools. The problem for crypto is how to square the utility they provide with the ideological mission whilst still managing to maintain momentum when arguably moving to the latter cannibalizes the former.
Interesting. Let me disagree though. As an intangible, unquantifiable pseudocurrency - we’re getting into the realm where currency-as-analogy sounds both pointed and on-topic, but is a somewhat strained analogy - ‘scene respect’ is as corrosive, perverting and uh… pervertible as any other incentive. It breeds quasi-religions, staffed by gurus and followers, blighted by orthodoxies and schisms. All of which the pre- and post-bust cryptoverse has. All of which seem to matter very little when real money arrives, which it may well again.
[1] https://www.ycombinator.com/topcompanies/revenue
[2] https://twitter.com/paulg/status/1740936771192623175
[3] https://www.coinfabrik.com/blog/oldest-blockchain-companies/
The trouble is, neither of those make money if run honestly. A true distributed exchange never has custody of anything. So there's no opportunity to steal or speculate with customer funds. (Front-running remains a possibility). It's just a back-end data service. It has to charge a commission. Most crypto exchanges are free to use; they make money either by stealing or manipulation.
Much the same is true for stablecoins. Tether just printed another billion dollars worth of Tether. Nobody deposited a billion dollars worth of USD. USDC is supposedly backed by U.S. Government securities, but is not formally audited.
Tether just printed another billion dollars worth of Tether.
Uniswap has done almost $2 trillion in volume over the past 4 years.
See:
https://medium.com/coinmonks/uniswap-v3-explained-57e0cdf867...
Underlying all the buzzwords, blockchains are about distributed communications with economic incentives attached to them and a more complex leader election mechanism. So there can be many things that can have the term blockchain slapped on them with a bit of tweaking.
Tether is audited regularly: https://tether.to/en/transparency/#usdt
It would not have survived multiple bear market cycles with tens of billions in redemptions and drawdowns if it wasn't solvent. The last cycle took out plenty of players who truly were insolvent (Luna, FTX, BlockFi, fo name a few).
Circle's reserves for USDC are listed by Blackrock : https://www.blackrock.com/cash/en-us/products/329365/ and provides monthly accounting reports, the most recent issued by Deloitte: https://www.circle.com/en/transparency#transparency
They also run the cryptocurrency village at Defcon.
Monero researchers have figured out how to do true atomic swaps between Bitcoin and monero, ensuring the exchange delistings will not kill the ultimate privacy coin https://eprint.iacr.org/2020/1126.pdf
Finally, the IRS offered a bounty if you could trace XMR. Not claimed (as far as we know!). How many other coins have that level of state interest
https://www.forbes.com/sites/kellyphillipserb/2020/09/14/irs...
(I feel inclined to agree, but I want more solid reasoning.)
It aims for one thing, untraceable payments, and not only seems to do that well, it actually is used to pay for stuff. Granted, most of that stuff is probably illegal, but it seems to work as a currency and not an 'investment' which seems to be the case for most of the other coins.
This criticism he levies at web3 here is the core reason I stopped believing in the vision. I was a big fan of it when ethereum launched mainnet. Mist browser, a reference interface for a truly decentralized internet. The vision: decentralized message transport, file storage and consensus/finality/incentivization for applications that need it. What a beautiful idea.
Instead we got metamask and http websites selling us erc20 tokens.
I think I probably agree that a big part of it is transaction fees. I think though that the Ethereum project abandoning the idea of a reference client left people to develop with the tools they had. There's no money in building a new browser for a different kind of web. There is money in selling DAO tokens to supposedly fund a lock that can be locked and unlocked by sending a cryptographically signed transaction executed on every node on a network and paid for for no good reason to be kept on record forever by everyone on the network. Don't have the decentralized tools to build it? Eh, fuck it, just build a website with pretty animations and flat monochrome icons that fade in and out as you scroll. As long as they can send us ETH we are happy, we will decentralize the rest later when someone else does the heavy lifting.
We needed mist to make this happen. The reason web3 failed is because the only part of it that ever actually worked was ethereum, and that's all that's needed to get people to give you their money. If we had bootstrapped with swarm and whisper them there would've been no excuse from dapp builders why all they have is a regular website, and scams wouldn't have become so prolific because we would have a baseline standard: the whole thing has to be decentralized or you're not getting a dime.
Funny you mention said lock, because the pivot and associated fallout there was what really revealed (to me) that the creators of Ethereum cared more about the "currency" aspect than the "crypto" aspect.
From that point on, you could see this reflected in every decision made about the development and direction of Ethereum and the associated ecosystem. There were numerous core protocol decisions that ultimately came down to "better for future users of the network or better for current users of the network", and the latter won out every time, especially when economics were involved--and they're always involved with a cryptocurrency.
Number go up, and whatnot.
nonsense. plenty of chains do this, but all have the same copy-pasted dapps.
ethereum is horrible, cannot die soon enough imo. ETH and BTC maxis are also very toxic community.