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Oh yeah totally I mean, one of the first bonkers things I learned about money is that its value changes and there's nowhere you can put it where it doesn't evap

Oh yeah totally I mean, one of the first bonkers things I learned about money is that its value changes and there's nowhere you can put it where it doesn't evaporate (devalue from inflation) where it might not instantly disappear (crash). Everything is a balance. But like, for locking up $130k in a wildly volatile market, I'd expect way more than 2%. That's way out of balance. Like, there are no reasonable (sure there are some bond ETFs or the one ESG ETF under 2%) Vanguard ETFs below that, and the ones you'd invest in are at worst 8%, none of which are anywhere near the risk or volatility of ETH. So to me, the 2% doesn't seem like an incentive. But I don't think it was designed that way? I thought it was to make the rewards more equitable, and also continue to keep validator skin in the game (why would you corrupt Ethereum, you get paid in ETH). I don't know if it really succeeds at these things; I think rich people can stake multiple times and the initial big miner investment are probably sufficient skin (plus like, are people committed to ETH because of their mining rigs or because of the gains?), but that's just conjecture, hard (impossible?) to know for sure.

rglullis 5y ago
You are not locking $130K, you are locking 32ETH. > people committed to ETH because of their mining rigs or because of the gains? ETH is not to be priced like a stock. ETH is to be priced like a non-renewable commodity like oil. If the network is not efficient, people will move away from it, demand for ETH goes down and so does its price. People staking ETH are betting that the network utility will grow and the demand for ETH will grow as well. > I think rich people can stake multiple times If you think it is a bad allocation of the capital, why would you think that people with lots of it would put so much into stake?
- camgunz 5y ago
  > You are not locking $130K, you are locking 32ETH. OK I mean, my point is in whatever fiat you want to pick, 32 ETH is a lot. > ETH is not to be priced like a stock. ETH is to be priced like a non-renewable commodity like oil. I don't know if ETH is like oil; when we run out of oil we legit run out, like it's gone. We can run out of blocks on Ethereum, but ETH sticks around "forever". As a result, I think the stock comparison is actually more accurate. Shares are divisible, their value relative to fiat fluctuates, they're transferable, etc. Or I mean, we could also view it as a currency. I just don't think it's a commodity at all, especially because it doesn't have physical utility. Every other commodity (like oil as you point out, or orange juice or cotton or copper) has physical utility. ETH doesn't. > If the network is not efficient, people will move away from it, demand for ETH goes down and so does its price. Well idk, the network is pretty inefficient right now. Buterin just posted "Endgame" where the main theme is basically "we'll get the transaction rate up". Relative to centralized transaction rates, Ethereum is very slow. And there are networks with faster transactions rates! And yet Ethereum remains popular. I think a lot of crypto advocates get caught up in the actual attributes of a network but then can't explain why clearly inferior networks like Bitcoin and Ethereum are super popular. Well, it's because they're worth a lot of fiat--very few people care about the nitty gritty of blockchains, they just want to get rich. So I don't think "people will move away from it" as long as the fiat price is high. And this just kind of torpedoes crypto optimism right? We have these networks that clearly solve a lot of problems that Bitcoin and Ethereum have, but it turns out the path to success and popularity is to make your coin as casino-like as possible. I think that's a compelling reason to be pessimistic, not optimistic. > People staking ETH are betting that the network utility will grow and the demand for ETH will grow as well. Yeah I mean, "bet" is the apt word here. >> I think rich people can stake multiple times > If you think it is a bad allocation of the capital, why would you think that people with lots of it would put so much into stake? I think the reasons other people would are legion: - I'm rich and I'm bored/interested - I understand the technology and I think we'll overcome the risks and downsides - As a libertarian I super hate liberal democracy and any kind of gatekeeping, and I'm willing to take some pretty drastic, risky actions to subvert its financial system - I believe a lot of people are disillusioned by capitalist economies and that will drive adoption of alternative economies and currencies FWIW I am in the 4th camp. I just think subverting financial systems set up by democracies is deeply immoral so I can't bring myself to profit off of it. Also I don't have 32 ETH to throw around haha.
  - rglullis 5y ago
    > 32 ETH is a lot. The point is that the staking contracts were set at 32 ETH since the time when ETH was about $100. There is a good amount of people that staked then when it was a lot easier, and today there is always the possibility of staking pools (just like there are mining pools) > ETH sticks around "forever". Not since July, when the EIP-1159 introduced gas fee burn. There has been since then a lot of blocks were more ETH was burned with the gas then generated as miner rewards, so ETH can be > network is pretty inefficient right now. (...) And there are networks with faster transactions rates! The mistake you are making is that - like the $130k comment above - you are thinking in terms of a static system. Ethereum is constant development precisely as a way to address the bottlenecks that are being hit. There are already people using Layer-2 systems for making transfers and for decentralized exchanges. This year we also are starting to see more complete scaling solutions. The more Layer-2 solutions come up, the less important the base-layer performance becomes for users. Talking about the base-layer when it has been widely established that Ethereum is heading to the direction of scaling through roll-ups and other layer-2 systems is either ignorance or intellectual dishonesty. > "bet" is the apt word here. Pretty much in the same way that people "invest" in Uber or other Unicorns even if they go years without turning a profit, people "invest" in Ethereum (or Bitcoin, or Cardano, or Solana, or whatever) because they expect that in the future that network will be useful. It is a bet that it will be more profitable and create wealth in the future. > I think the reasons other people would are legion: You misunderstood my question. You were criticizing PoS because you claimed that it wasn´t capital efficient (2"% is not much..."), at the same time you pointing out the "issue" that "rich people" could put more at stake than others. These criticisms are at odds with one another. > I just think subverting financial systems set up by democracies is deeply immoral Not only you are clearly mistaking opinions for facts; this single statement seems to be based on a worldview that: - assumes that "financial systems" were "set up" by democracies. - assumes that being a "liberal democracy" is a binary property. - assumes that leaders and elites from the "liberal democracies" are actually working with the interests of people at heart. - assumes that "liberal democracies" are the inevitable endgame for government. - assumes that people working with decentralization are only concerned about "finance". - is based on a false dichotomy of "full-anarchy" vs "globalized world subject to a set of universal values as defined by liberal democracies" > so I can't bring myself to profit off of it. Do you own any stock? Pension funds? a 401-k? Worked for any VC-funded company? Bought anything made in China even though you knew there was an alternative product made in $wherever_you_live? Then yes, you are profiting off of it. So please just get off the high horse.

rglullis 5y ago

You are not locking $130K, you are locking 32ETH. > people committed to ETH because of their mining rigs or because of the gains? ETH is not to be priced like a stock. ETH is to be priced like a non-renewable commodity like oil. If the network is not efficient, people will move away from it, demand for ETH goes down and so does its price. People staking ETH are betting that the network utility will grow and the demand for ETH will grow as well. > I think rich people can stake multiple times If you think it is a bad allocation of the capital, why would you think that people with lots of it would put so much into stake?

camgunz 5y ago
> You are not locking $130K, you are locking 32ETH. OK I mean, my point is in whatever fiat you want to pick, 32 ETH is a lot. > ETH is not to be priced like a stock. ETH is to be priced like a non-renewable commodity like oil. I don't know if ETH is like oil; when we run out of oil we legit run out, like it's gone. We can run out of blocks on Ethereum, but ETH sticks around "forever". As a result, I think the stock comparison is actually more accurate. Shares are divisible, their value relative to fiat fluctuates, they're transferable, etc. Or I mean, we could also view it as a currency. I just don't think it's a commodity at all, especially because it doesn't have physical utility. Every other commodity (like oil as you point out, or orange juice or cotton or copper) has physical utility. ETH doesn't. > If the network is not efficient, people will move away from it, demand for ETH goes down and so does its price. Well idk, the network is pretty inefficient right now. Buterin just posted "Endgame" where the main theme is basically "we'll get the transaction rate up". Relative to centralized transaction rates, Ethereum is very slow. And there are networks with faster transactions rates! And yet Ethereum remains popular. I think a lot of crypto advocates get caught up in the actual attributes of a network but then can't explain why clearly inferior networks like Bitcoin and Ethereum are super popular. Well, it's because they're worth a lot of fiat--very few people care about the nitty gritty of blockchains, they just want to get rich. So I don't think "people will move away from it" as long as the fiat price is high. And this just kind of torpedoes crypto optimism right? We have these networks that clearly solve a lot of problems that Bitcoin and Ethereum have, but it turns out the path to success and popularity is to make your coin as casino-like as possible. I think that's a compelling reason to be pessimistic, not optimistic. > People staking ETH are betting that the network utility will grow and the demand for ETH will grow as well. Yeah I mean, "bet" is the apt word here. >> I think rich people can stake multiple times > If you think it is a bad allocation of the capital, why would you think that people with lots of it would put so much into stake? I think the reasons other people would are legion: - I'm rich and I'm bored/interested - I understand the technology and I think we'll overcome the risks and downsides - As a libertarian I super hate liberal democracy and any kind of gatekeeping, and I'm willing to take some pretty drastic, risky actions to subvert its financial system - I believe a lot of people are disillusioned by capitalist economies and that will drive adoption of alternative economies and currencies FWIW I am in the 4th camp. I just think subverting financial systems set up by democracies is deeply immoral so I can't bring myself to profit off of it. Also I don't have 32 ETH to throw around haha.
- rglullis 5y ago
  > 32 ETH is a lot. The point is that the staking contracts were set at 32 ETH since the time when ETH was about $100. There is a good amount of people that staked then when it was a lot easier, and today there is always the possibility of staking pools (just like there are mining pools) > ETH sticks around "forever". Not since July, when the EIP-1159 introduced gas fee burn. There has been since then a lot of blocks were more ETH was burned with the gas then generated as miner rewards, so ETH can be > network is pretty inefficient right now. (...) And there are networks with faster transactions rates! The mistake you are making is that - like the $130k comment above - you are thinking in terms of a static system. Ethereum is constant development precisely as a way to address the bottlenecks that are being hit. There are already people using Layer-2 systems for making transfers and for decentralized exchanges. This year we also are starting to see more complete scaling solutions. The more Layer-2 solutions come up, the less important the base-layer performance becomes for users. Talking about the base-layer when it has been widely established that Ethereum is heading to the direction of scaling through roll-ups and other layer-2 systems is either ignorance or intellectual dishonesty. > "bet" is the apt word here. Pretty much in the same way that people "invest" in Uber or other Unicorns even if they go years without turning a profit, people "invest" in Ethereum (or Bitcoin, or Cardano, or Solana, or whatever) because they expect that in the future that network will be useful. It is a bet that it will be more profitable and create wealth in the future. > I think the reasons other people would are legion: You misunderstood my question. You were criticizing PoS because you claimed that it wasn´t capital efficient (2"% is not much..."), at the same time you pointing out the "issue" that "rich people" could put more at stake than others. These criticisms are at odds with one another. > I just think subverting financial systems set up by democracies is deeply immoral Not only you are clearly mistaking opinions for facts; this single statement seems to be based on a worldview that: - assumes that "financial systems" were "set up" by democracies. - assumes that being a "liberal democracy" is a binary property. - assumes that leaders and elites from the "liberal democracies" are actually working with the interests of people at heart. - assumes that "liberal democracies" are the inevitable endgame for government. - assumes that people working with decentralization are only concerned about "finance". - is based on a false dichotomy of "full-anarchy" vs "globalized world subject to a set of universal values as defined by liberal democracies" > so I can't bring myself to profit off of it. Do you own any stock? Pension funds? a 401-k? Worked for any VC-funded company? Bought anything made in China even though you knew there was an alternative product made in $wherever_you_live? Then yes, you are profiting off of it. So please just get off the high horse.