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> I think Ethereum 2.0 is currently demonstrating at scale that proof of stake works fine and can be secure against hordes of very incentivized hackers trying t

> I think Ethereum 2.0 is currently demonstrating at scale that proof of stake works fine and can be secure against hordes of very incentivized hackers trying to cheat. That should hopefully bury the whole proof of stake is centralized argument. This is really shakey ground to prop up an argument in favor of cryptocurrency: AFAICT no cryptocurrency ever dies until people stop trading it, which virtually never happens. I’m reminded of the saga of “stable coins” — stable coins of the non-IOU sort. Every major example of one has imploded at least once during times of high market volatility, no exceptions. Including as recently as 2020. You’d think after enough of these implosions the concept would be disproven on a fundamental level, but no. (Many have considered these unstable stablecoins theoretically unsound ever since the concept’s inception — bitUSD IIRC — with clear parallels to PoS.) Developers and VCs have been deeply invested in PoS consensus for many years now, mostly because they were attractive financial bets to make. There’s no use in my even opining on the theoretical flaws of PoS, because implosions of cryptocurrencies seem to not even matter to investors. Anyway, at some point, the people funding and developing these PoS systems evidently shifted into abject promotion mode for obvious financially motivated reasons based on really nothing aside from investor expectations. Nothing has ever been proven about PoS aside from the fact traders are willing to hold speculative positions in these coins — no different from the reasons they’ve held any other cryptocurrency. And even if PoS were a fundamentally discredited concept disproven as many times over as “unstable stablecoins” have been, it would change absolutely nothing about investor behaviour.

jillesvangurp 5y ago
I'm talking about it scaling; not about the value of the token. Ethereum 2 tackles scalability through PoS and sharding. Hence the reported energy advantage. Ethereum 2 will be one of the largest proof of stake networks once it launches both by market value and by number of users and validators. The longer that stays up without incidents; the better. The market value means that every known angle towards possibly abusing/hacking the network will be pursued by countless very incentivized hackers. Them failing to get anywhere increases the level of trust people have in these networks. In think your point of view is a bit comparable to late stage skeptics arguing against dot com companies 20 years ago. They were mostly right and yet the FANG companies booted (or rebooted) straight out of that. So clearly they were also wrong. Very wrong. Because those companies are now worth trillions. Looking at what came out of that bubble, it is hard to argue that there was nothing there. Of course there was. But of course there were many failures as well and lots of investors backing the wrong companies for all the wrong reasons. But the technology from that era bootstrapped a multi trillion dollar industry. The blockchain space is very similar. Lots of obvious scams, naive companies, poorly thought through business ideas, half-assed technology, etc. And lots of investors getting rich on being there early and losing other people's money (which, lets face it, is how that greed fueled behavior works). It's a symbiotic relation ship between mediocre investors and mediocre entrepreneurs. That hasn't changed in the last 20 years. That bubble is going to pop at some point. But that does not mean it will drag all blockchains with it. The thing with Ethereum is that is mostly not directly dependent on VC cash. And that's one of it's strong points. The wider ecosystem is of course. But people like Vitalik Butarik and his friends are not reporting to anyone financed by a VC because they are already financially independent. That's also the reason they have been moving slowly and carefully with Ethereum 2 for years rather than rushing it to market in a few months. They've been talking about proof of stake and sharding for years already. Before the first bitcoin bubble even (four years ago or so). Blockchains are as strong as those running them. Ethereum 2 right now looks like it is happening and has staying power and will have quite a bit staked among quite a few users. I'd argue most of the Ethereum 1 value is actually based on that future potential.
- atweiden 5y ago
  For a technology to be falsifiable, there needs to be an agreed upon method of measuring its fundamental failure. Even in cases like stablecoins where investors are provably losing millions of dollars on repeat oweing to fundamental design faults of the underlying protocol, the coins continue being traded nonetheless. The coins are still worth money despite the many instances of clear technical failures — “being worth money” appears to be the sole arbiter of “validity”. How can the underlying tech really be disproven? Cryptocurrency is an effectively unfalsifiable technology. You could be selling a one-wheeled tricycle, and investors would still trade it based on one narrative or another. That is more or less the case with PoS.

jillesvangurp 5y ago

I'm talking about it scaling; not about the value of the token. Ethereum 2 tackles scalability through PoS and sharding. Hence the reported energy advantage. Ethereum 2 will be one of the largest proof of stake networks once it launches both by market value and by number of users and validators. The longer that stays up without incidents; the better. The market value means that every known angle towards possibly abusing/hacking the network will be pursued by countless very incentivized hackers. Them failing to get anywhere increases the level of trust people have in these networks. In think your point of view is a bit comparable to late stage skeptics arguing against dot com companies 20 years ago. They were mostly right and yet the FANG companies booted (or rebooted) straight out of that. So clearly they were also wrong. Very wrong. Because those companies are now worth trillions. Looking at what came out of that bubble, it is hard to argue that there was nothing there. Of course there was. But of course there were many failures as well and lots of investors backing the wrong companies for all the wrong reasons. But the technology from that era bootstrapped a multi trillion dollar industry. The blockchain space is very similar. Lots of obvious scams, naive companies, poorly thought through business ideas, half-assed technology, etc. And lots of investors getting rich on being there early and losing other people's money (which, lets face it, is how that greed fueled behavior works). It's a symbiotic relation ship between mediocre investors and mediocre entrepreneurs. That hasn't changed in the last 20 years. That bubble is going to pop at some point. But that does not mean it will drag all blockchains with it. The thing with Ethereum is that is mostly not directly dependent on VC cash. And that's one of it's strong points. The wider ecosystem is of course. But people like Vitalik Butarik and his friends are not reporting to anyone financed by a VC because they are already financially independent. That's also the reason they have been moving slowly and carefully with Ethereum 2 for years rather than rushing it to market in a few months. They've been talking about proof of stake and sharding for years already. Before the first bitcoin bubble even (four years ago or so). Blockchains are as strong as those running them. Ethereum 2 right now looks like it is happening and has staying power and will have quite a bit staked among quite a few users. I'd argue most of the Ethereum 1 value is actually based on that future potential.

atweiden 5y ago
For a technology to be falsifiable, there needs to be an agreed upon method of measuring its fundamental failure. Even in cases like stablecoins where investors are provably losing millions of dollars on repeat oweing to fundamental design faults of the underlying protocol, the coins continue being traded nonetheless. The coins are still worth money despite the many instances of clear technical failures — “being worth money” appears to be the sole arbiter of “validity”. How can the underlying tech really be disproven? Cryptocurrency is an effectively unfalsifiable technology. You could be selling a one-wheeled tricycle, and investors would still trade it based on one narrative or another. That is more or less the case with PoS.