Ethereum Genesis Sale | Hacker News Reader

Ethereum Genesis Sale

ethereum.org

93 pointsMichaelAO55 comments

Ethereum launch in review:

- Investment Prospectus: https://www.ethereum.org/pdfs/TermsAndConditionsOfTheEthereu...

- Premine Part I: Anyone can buy ETH in exchange for BTC for the next 42 days

- Premine Part II: On top of Premine Part I, +10% of the total ETH allocated during Premine Part I will be distributed to "early contributors"

- Premine Part III: On top of Premine Part I and Premine Part II, +10% of the total ETH allocated during Premine Part I will be distributed to the Ethereum Foundation

- The supply of ETH is uncapped and inflationary at a rate of +25% per year

- The premine is being conducted by "EthSuisse", a Swiss entity which will be prompty dissolved after the premining period ends. The Ethereum team makes no guarantee that development of Ethereum will continue after the dissolution of "EthSuisse"

- Regardless of how many BTCs are raised during the premine period, ~4000 BTC is explicitly reserved to pay for "Expenses incurred prior to and related to Genesis Sale". Translation: they are pocketing the first 4000-5000 BTC

> The Ethereum Platform is being developed primarily by a volunteer contributor team - many of whom will be receiving gifts of ETH in acknowledgement of their dedication - and will continue to be developed on a volunteer basis by some developers as well as under a more formalized contracting or employment relationship for other developers. The group of developers and other personnel that is now, or will be, employed by, or contracted with, Ethereum Switzerland GmbH ("EthSuisse") is termed the "Ethereum Team." EthSuisse will be liquidated shortly after creation of genesis block, and EthSuisse anticipates (but does not guarantee) that after it is dissolved the Ethereum Platform will continue to be developed by persons and entities who support Ethereum, including both volunteers and developers who are paid by nonprofit entities interested in supporting the Ethereum Platform.

It's not 25% inflation (of the outstanding money supply) per year; it's a fixed number of ETH per year. Essentially another open-loop deflationary monetary policy.

That's not deflationary in any sense. The total amount of Ether issued always increases, thus devaluing all the Ether issued earlier.

That's why it doesn't make any sense to buy it now, unless you need it now.

> That's why it doesn't make any sense to buy it now, unless you need it now.

I think inflation/deflation has very little impact on investment value, only on nominal price on a unit currency. A currency could be wildly inflationary and still a good store of value, if people sell them cheaply because of the expected inflation and it turns out future demand was underestimated. In that case, it would still increase in price just as much as a deflationary currency.

You're using a nonstandard definition of deflation. When the real economy grows faster than the money supply, prices go down, which is deflation. If the money supply is growing at 1% per year or less (which will happen in year N of Ethereum), it's easy for real growth to outstrip it. Alternately, if demand for ETH grows faster than the supply the price of other currencies will fall relative to ETH.

I generally think that pre-mined cryptocurrencies are bad, just a lottery for a small group of insiders.

And this ethereum sale is pre-pre-mined ... pay now for the chance to get pre-mined currency later.

I'm intrigued by the concept, though. Decentralized storage, compute, scripting and secure exchange is an ideal platform for autonomous corporations.

> I generally think that pre-mined cryptocurrencies are bad, just a lottery for a small group of insiders.

It's less a lottery for the early adopters and more a money funnel for the creators -- and a cash toilet for everyone else.

The technology here is interesting but not new, and the problems that will make this fail are found in the social fabric, not code.

Realistically, though, I think there is a scalable new business model emerging: make up something of no tangible value (bonus points for instead selling a promise of providing something of intangible value), slap on a price tag, add pretty design and some concept videos. Rinse and repeat until the pop.

Fresh tulips on deck.

> Realistically, though, I think there is a scalable new business model emerging: make up something of no tangible value (bonus points for instead selling a promise of providing something of intangible value), slap on a price tag, add pretty design and some concept videos. Rinse and repeat until the pop.

But they already have proof of concept clients and scripting languages set up. It's not as if they're doing a crowdfunding campaign with just an idea. Would I be wary of the project if it had no code? Sure, anyone would be. But am I wary of a project that's being actively developed? Certainly not as much. The code can speak for itself.

New business model? Hyping and selling worthless junk to suckers is probably the oldest scheme. From magic trinkets and panaceas to 100500% guaranteed profit investments

Look at the "Intended use of renevue" page - it's basically crowdfunding. Time will show if they'll deliver on the goals (probably not? Those are some pretty big numbers.), but it seems like a useful way to address the "lottery for a small group of insiders" concern.

It is probably a mistake to summarise the ethereum project as a cryptocurrency, it aims to be a lot more than that. That said, the problem with this kind of fundraising is that an important part of the "investors" are not apt to judge the technical merits of the project as a distributed app plateform. I cannot either so I wont be investing, but I would enjoy some technical input on the matter. Autonomous corporations could be a world-changing innovation, possibly as important as the cryptocurrency concept itself.

As for the non-technical aspects of the project it seems to me that the ethereum team has tried to make the fundraising fair and non-speculative. There is a great amount of fear from people who have vested interest in some alternative cryptocurrencies in this thread. It is a shame that we cannot have rational discussions as it usually the case on HN. Greed is not always good.

> Also, please note that before the release of the Genesis Block in the winter of 2014/2015, ether will not be usable in any way, in fact it won’t technically be created until that point in time.

This doesn't exactly instill confidence. Buyers are purchasing an IOU, which is the opposite of a trustless, distributed system. (At least they're up-front about it.)

People also should note that the Ethereum folks have blown past many deadlines, so I would be skeptical of this being ready even in Winter 2014/2015. (Disclosure: I plan to invest regardless)

If you have time to read up on the technicals, the following introductory paper (dubbed 'the yellow paper') is highly informative with regards to the technology and related work Ethereum is based upon: http://gavwood.com/Paper.pdf

I don't see this panning out well. Between the wonky incentive scheme, the lack of usefulness, and the mishaps with broken hash algorithms and stuff, there is not a lot of promising stuff going on here.

Is there something I'm missing? Does Ethereum actually let us do anything new, or better than we can do it now?

Ethereum is truly innovative; the first genuine stab at a post-Bitcoin blockchain.

It's also going to take many, many years to work the kinks out. The scripting language is so much more sophisticated that it'll be quite some time before the ins and outs of attack vectors will be reasonably understood.

I'll save comments on the mining for another time; I'm not totally up to date with their current plans. One thing any mining strategy needs to have a solution for is the popularity / security dichotomy: Bitcoin has provably much more compute than you securing the network. This makes you want to tag on to Bitcoin, with, say the side-chain proposal.

On the other hand, if you do that, pre-mining becomes harder, and you will be dealing with ASIC cartel economics. If you go the other way and build a 'non-ASIC-able' proof of work, you probably don't want to accidentally get on the ASIC bandwagon when you've promised your customers that they won't be on it.

> If you go the other way and build a 'non-ASIC-able' proof of work, you probably don't want to accidentally get on the ASIC bandwagon when you've promised your customers that they won't be on it.

You also run the risk that anybody with access to a botnet might be able to gain 51% of the network's processing power.

Are we already going post-bitcoin? By all accounts we are still struggling to figure out bitcoin.

I actually think it's unfortunate that a "pure" currency was the first application of the blockchain. Bitcoin's problems are around mindshare and social acceptance, because it's useless without it. Something like Filecoin interests me much more, because the value of the system is a bit more independent of crowd psychology.

You can "snap together" pieces and build an ethereum script for various things here: http://etherscripter.com/0-4-0/

See the code sample link. You can even check out the output in a Lisp-like language.

You didn't actually answer any of my questions. Why is ethereum useful? It's also not that innovative. Increase the scope of the scripting language and charge for ops, and you've just turned Bitcoin into it.

You'd also need a key-value store linked to contracts, as well as the ability for contracts to call each other. Those are more difficult (though your main point stands)

One thing that nobody's mentioned in the Ethereum camp is how useful good tooling is. If you think back to the past year of Bitcoin history there are a lot of high-profile sites that could have and should have made use of more sophisticated bitcoin escrow transactions. Why didn't they[0]? IMO there isn't going to be much of an abstraction layer over the underlying Bitcoin transaction language and anyone who wants to use these features will have to learn how to write directly in the transaction bytecode[1]. Ethereum will have much better tooling (they're already working hard at it!) and this is how you'll turn Ethereum's competitive feature advantages over Bitcoin into users.

-----

[0] Ok, let's assume good faith on the operator's part.

[1] What I'd like to see is a 'C' for bitcoin transactions instead of the current assembler. I don't think that will happen.

Is this the western/hipster equivalent of a 419 scam?

Yes

I find it sad to see this type of negative comment on a site dedicated to technological innovation and entrepreneurship. And I'm saying this as someone who doesn't plan to invest in Ethereum.

people dedicated to technological innovation can't believe in scams?

There's plenty of quacks calling themselves innovators and entrepreneurs. We should pride ourselves in taking a critical eye to things, and the OP isn't the only person to smell the unmistakable funk of a scam in this.

They already have a working proof of concept and lots of interest from the Hacker community.

Have you even looked at it? If you don't think that it's innovative, I guess it's something you would invent in your sleep?

Makes me hope they actually succeed, so that I can watch out for your "I could have done that" comment on HN.

Ethereum is undeniably innovative (the first crypto currency that incorporates a Turing complete language). It certainly is a very risky investment but a scam?

From Wikipedia on 419 scams: "The scam typically involves promising the victim a significant share of a large sum of money, which the fraudster requires a small up-front payment to obtain."

I don't see Ethereum promising anybody a large sum of money, so I guess it's not a 419 scam. Nice try, though.

Presumably it is simply a crowdfunding campaign.

I bet most people don't even know what they are "buying", but they all wanna get richer quick.

Introducing Freethereum: a future fork of Ethereum with its own Genesis Block. Please note that before the release of the Freethereum Genesis Block, freether will not be usable in any way, in fact it won’t technically be created until that point in time.

Buy Now: 1 BTC = 9999 FREE

Exodus to 1MAHTNYgv6di77RVcCU7vXtA7FgYEosb8H!

Code doesn't make a fledgling currency. The brand does via the demand that brand creates.

Ethereum is more ambitious than being merely a fledgling currency. It's a fledgling civil infrastructure. That's a pretty big responsibility. Forks and threats of forks are a way to keep "brands" honest.

And speaking of brands, everyone likes "free"!

Introducing Libreum: a future fork of Freethereum with its own Genesis Block. Please note that before the release of the Libreum Genesis Block, Libreum will not be usable in any way, in fact it won’t technically be created until that point in time.

Invest Now: 1 FREE = 1l1l1l LIBRE

Payable to 1SLASHDEVSLASHNULL

Ha ha! But serious:

There's the thought experiment of "Aethereum" (note the subtly-different leading-A spelling). It is the suggestion there be another alt-coin, which uses Ethereum's code (and thus is feature-equivalent), but skips its initial distribution, instead using a point-in-time copy of the evolved Bitcoin distribution. For more info:

https://bitcointalk.org/index.php?topic=563972.0

More generally, the idea has been termed a "spin-out". (I like "spincoin" as a description of the process, too, and proposed a specific refinement called "Sumcoin" in that thread back in April.)

This tactic – or just the credible threat of it – creates an interesting differentiation challenge for feature-based cryptocoins.

Sometimes reading new crypto news I think that all my attempts to build some real software for people are just worthless. All I need is stay at home for 6 months and roll out another $coin$ to participate in this gold rush. Oh ok.

They have clients in 3 different languages, something like 3 different scripting languages that compile to the assembler, a working testnet, an ecosystem of working contracts, and a bunch of 3rd party apps already. It's good to be skeptical, but this comment strikes me as ignorant.

This comment strikes me as emotional :)

I didn't say I can rewrite all _their_ codebase in 6 months.

But if we are talking just about something working enough to get attention - why not?

OK, I have followed some of the musings of the cryptocurrency crowd, though not in tremendous depth. I watched the video, I'm not looking for a tl;dr; per se, just what is it that I just watched?

I feel like I just watched yet another solution to all the world's problems or something.

Now, when he says "users can be rewarded with tokens of value into the startups that they invest in" .... Now, in my world, this is not a novel concept. This is called "money," wall street does this every day. Just saying ...

The key technology of cryptocurrency is the blockchain, which essentially allows for many sorts of centralized verification to be replaced with math. Most of the application ideas floating around the cryptocurrency world aren't fundamentally new, but are rather taking centralized ideas and doing them in a decentralized way.

So, Bitcoin is just online money transfers, but without banks or credit card companies or Paypal being involved. Ethereum is just the stock market (and lots of other things), but without Wall Street or any of the other centralized authorities.

It's not yet clear what the best use-cases are, or which specific implementations (if any) will survive. But I'm pretty optimistic about someone finding something useful to do with this technology.

Hah classic Mircea Popescu :)

http://log.bitcoin-assets.com/?date=22-07-2014#764497

22:54:55mircea_popescu:;;sell 5000 "ethereum coins deliverable March 15th, 2015" 1 BTC "Up to 1k BTC's worth accepted. Get in touch."

I was pretty excited about Ethereum when I first heard about it, but now, it looks like there is no fixed cap on the total amount of ether, which I consider to be a major fault.

What's stopping people from forking and making a "version" with a fixed cap, like bitcoin?

I believe that they have stated that they are aware of the possibility of forks due to people having differing preferences, and that their stated view of that is that if thats what people want to do then that is what people will do.

So, I don't think theres anything preventing such a new version from being created.

(It could be difficult to get a large enough mass of people on it though.)

Bitcoin has a fixed cap but it won't be reached until 2140. For the first four years it had linear growth, just like Ethereum will have. Demand increased faster than supply so the price went up.

In percentage terms, Ethereum's growth will be down to 5%/year after 20 years.

Ethereum has all the trappings of a cult (have you seen some of the nuball videos they have posted) and cults aren't known for having it all together.

Apparently literally everything is a cult.

Those videos sound interesting, link?

Peter Thiel apparently is a "believer" [0]... What does this means to you?

[0] http://www.coindesk.com/peter-thiel-fellowship-ethereum-vita...

My opinion of the Thiel Fellowship has been dropping lately.

Does anyone have a TLDR on this?

The devs are going to make a shit ton of money.

YACS - yet another coin scam

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