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Enjoyed the article. I think one can boil it down pretty simply: decisionmakers at Ethereum don't care about investors. They're going to make decisions that sup

by bo1024 6y ago

Enjoyed the article. I think one can boil it down pretty simply: decisionmakers at Ethereum don't care about investors. They're going to make decisions that support and enable interesting decentralized applications, and "defi" is incidental to that, but in they end they wouldn't care if Eth gets massively devalued or something as long as the ecosystem is healthy and growing. Disclaimer: this is just my own perspective and speculation based on a bit of reading and brief convos with Ethereum foundation people.

chrisco255 6y ago
That's not true. If ETH gets devalued through inflation by too much the security of the network would be compromised. They are explicitly moving to a 100% proof of stake model for securing the network (already partially deployed). This directly incentivizes stakeholders to protect the valuation of ETH. Finally, if EIP-1559 is implemented, the network will begin burning transaction fees. That is to say, it's possible in the future more ETH will be burned via transaction fees than produced from staking, in which case ETH issuance will go negative.
- bo1024 6y ago
  I don't think it follows that my summary is wrong. I'm suggesting Ethereum people are happy to incentivize investment and stakeholders to protect ETH's value -- but not because they actually care about investors getting a good return, rather, because they want good security properties for their decentralized applications.
grubles 6y ago
That's not true at all. The decision makers in Ethereum care overwhelmingly about maximizing the value of their massive premine holdings. The latest EIP-1559 proposal (tl;dr ETH gets burned in every transaction) makes their stash an even larger percentage of the overall ETH distribution. Which is even more egregious when you learn that proof-of-stake rewards those with the most money (read: the decision makers).
- CryptoPunk 6y ago
  >>The latest EIP-1559 proposal (tl;dr ETH gets burned in every transaction) makes their stash an even larger percentage of the overall ETH distribution That assumes they don't spend their ETH on fees, which doesn't make realistic assumptions about the makeup of this group. >>Which is even more egregious when you learn that proof-of-stake rewards those with the most money (read: the decision makers). PoS is no worse than PoW in this respect. Both PoW and PoS reward validators in proportion to their capital assets. In the case of PoW, mining ASICs, and in the case of PoS, ETH. In any case, the fact that larger miners/stakers make more is neither surprising nor a cause for concern. It's the rate of return on capital being higher for larger investors that would be concerning, as that has the effect of concentrating wealth. There is less of an economies of scale effect in staking than in proof-of-work generation, with smaller validators having a ROI on their capital assets that is closer to that of larger validators in PoS than in PoW. So PoS should have a weaker tendency toward growing wealth inequality than PoW.
- bo1024 6y ago
  > The decision makers in Ethereum care overwhelmingly about maximizing the value of their massive premine holdings. That's not the impression I got of Vitalik Buterin at all, nor others at the Ethereum foundation. Maybe you have a different set of decisionmakers in mind.
gruez 6y ago
Haven't fully read the article, but >I think one can boil it down pretty simply: decisionmakers at Ethereum don't care about investors As opposed to bitcoin devs?
- plussed_reader 6y ago
  The guiding hand of Satoshi continues to rub one out while sitting in some corner.
  - phist_mcgee 6y ago
    Come on dude, that really does not add anything to the conversation..
    - plussed_reader 6y ago
      The thread is referencing Ethereum devs, when the bitcoin dev(s?) are where? Lot's of folks riffing on the original implementation, but ultimately just a fork.
- bo1024 6y ago
  I don't know what you mean exactly, but: Bitcoin is really stable, it's not under development in the same way Ethereum is. So "bitcoin devs" don't really exist. Whereas a relatively small group of people could potentially change how Ethereum works, a lot.

by bo1024 6y ago

chrisco255 6y ago

That's not true. If ETH gets devalued through inflation by too much the security of the network would be compromised. They are explicitly moving to a 100% proof of stake model for securing the network (already partially deployed). This directly incentivizes stakeholders to protect the valuation of ETH. Finally, if EIP-1559 is implemented, the network will begin burning transaction fees. That is to say, it's possible in the future more ETH will be burned via transaction fees than produced from staking, in which case ETH issuance will go negative.

bo1024 6y ago
I don't think it follows that my summary is wrong. I'm suggesting Ethereum people are happy to incentivize investment and stakeholders to protect ETH's value -- but not because they actually care about investors getting a good return, rather, because they want good security properties for their decentralized applications.

grubles 6y ago

That's not true at all. The decision makers in Ethereum care overwhelmingly about maximizing the value of their massive premine holdings. The latest EIP-1559 proposal (tl;dr ETH gets burned in every transaction) makes their stash an even larger percentage of the overall ETH distribution. Which is even more egregious when you learn that proof-of-stake rewards those with the most money (read: the decision makers).

CryptoPunk 6y ago
>>The latest EIP-1559 proposal (tl;dr ETH gets burned in every transaction) makes their stash an even larger percentage of the overall ETH distribution That assumes they don't spend their ETH on fees, which doesn't make realistic assumptions about the makeup of this group. >>Which is even more egregious when you learn that proof-of-stake rewards those with the most money (read: the decision makers). PoS is no worse than PoW in this respect. Both PoW and PoS reward validators in proportion to their capital assets. In the case of PoW, mining ASICs, and in the case of PoS, ETH. In any case, the fact that larger miners/stakers make more is neither surprising nor a cause for concern. It's the rate of return on capital being higher for larger investors that would be concerning, as that has the effect of concentrating wealth. There is less of an economies of scale effect in staking than in proof-of-work generation, with smaller validators having a ROI on their capital assets that is closer to that of larger validators in PoS than in PoW. So PoS should have a weaker tendency toward growing wealth inequality than PoW.
bo1024 6y ago
> The decision makers in Ethereum care overwhelmingly about maximizing the value of their massive premine holdings. That's not the impression I got of Vitalik Buterin at all, nor others at the Ethereum foundation. Maybe you have a different set of decisionmakers in mind.

gruez 6y ago

Haven't fully read the article, but >I think one can boil it down pretty simply: decisionmakers at Ethereum don't care about investors As opposed to bitcoin devs?

plussed_reader 6y ago
The guiding hand of Satoshi continues to rub one out while sitting in some corner.
- phist_mcgee 6y ago
  Come on dude, that really does not add anything to the conversation..
  - plussed_reader 6y ago
    The thread is referencing Ethereum devs, when the bitcoin dev(s?) are where? Lot's of folks riffing on the original implementation, but ultimately just a fork.
bo1024 6y ago
I don't know what you mean exactly, but: Bitcoin is really stable, it's not under development in the same way Ethereum is. So "bitcoin devs" don't really exist. Whereas a relatively small group of people could potentially change how Ethereum works, a lot.