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> Will investors choose to invest in a system that leaks value, or a system (like Ethereum post-merge) that is designed to accrue value? Ethereum is leaky, too

> Will investors choose to invest in a system that leaks value, or a system (like Ethereum post-merge) that is designed to accrue value? Ethereum is leaky, too. Since the merge, supply has grown by more than 2500 ETH.

deleted 4y ago
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mudrockbestgirl 4y ago
You realize supply growth was significantly larger with PoW, right? It's like saying "Ethereum uses energy too!" completely ignoring the fact that it uses 99.9% less energy.
- sph 4y ago
  What has supply growth anything to do with how the network is secured (PoW specifically)? There is no correlation nor relation whatsoever between the two.
  - zeroclip 4y ago
    Security is strongly correlated with issuance i.e. supply growth. If miners must spend X amount of value to compute hashes and secure the network, and the issuance or protocol reward is not sufficient to justify this spending, the security of the network is at risk.
  - mudrockbestgirl 4y ago
    Miners/stakers get paid for securing the network and that's exactly what determines how much ETH is issued.
  - DennisP 4y ago
    Ethereum lowered the issuance rate dramatically when it changed to PoS. The reason it was able to do this without lowering the cost of a 51% attack is that it no longer has to rely on rewards alone. It can also apply penalties. Certain provable attacks result in automatic destruction of stake. In PoW terms, it's as if a 51% attack caused the attacker's mining rig to burn down.
zeroclip 4y ago
Compare PoS and PoW here, +2800 ETH vs +51,500 ETH. https://ultrasound.money/ https://ultrasound.money/ Supply growth is not a bad thing for a crypto currency. Ideally the protocol rewards participants enough to incentivize them to secure the network, but no more.
DennisP 4y ago
As a percentage of supply, Ethereum only issues about 10% as much as Bitcoin. On top of that, a portion of Ethereum fees are burned instead of paid to stakers. The supply is still slowly increasing, but at a (fairly modest) fee level of around 16 gwei the supply starts to shrink. The higher the demand for blockspace, the faster the supply shrinks.
- greyface- 4y ago
  "the PoS merge [...] will reduce issuance to the point where the ETH supply will begin to shrink" https://news.ycombinator.com/item?id=31826155 https://news.ycombinator.com/item?id=31826155 "the ETH supply will begin to shrink" https://news.ycombinator.com/item?id=29080421 https://news.ycombinator.com/item?id=29080421 > only issues about 10% as much 10% is 3 halvings. I'll take a nap.
  - DennisP 4y ago
    After you're better rested, maybe read my second paragraph?

deleted 4y ago

[deleted]

mudrockbestgirl 4y ago

You realize supply growth was significantly larger with PoW, right? It's like saying "Ethereum uses energy too!" completely ignoring the fact that it uses 99.9% less energy.

sph 4y ago
What has supply growth anything to do with how the network is secured (PoW specifically)? There is no correlation nor relation whatsoever between the two.
- zeroclip 4y ago
  Security is strongly correlated with issuance i.e. supply growth. If miners must spend X amount of value to compute hashes and secure the network, and the issuance or protocol reward is not sufficient to justify this spending, the security of the network is at risk.
- mudrockbestgirl 4y ago
  Miners/stakers get paid for securing the network and that's exactly what determines how much ETH is issued.
- DennisP 4y ago
  Ethereum lowered the issuance rate dramatically when it changed to PoS. The reason it was able to do this without lowering the cost of a 51% attack is that it no longer has to rely on rewards alone. It can also apply penalties. Certain provable attacks result in automatic destruction of stake. In PoW terms, it's as if a 51% attack caused the attacker's mining rig to burn down.

zeroclip 4y ago

Compare PoS and PoW here, +2800 ETH vs +51,500 ETH. https://ultrasound.money/ https://ultrasound.money/ Supply growth is not a bad thing for a crypto currency. Ideally the protocol rewards participants enough to incentivize them to secure the network, but no more.

DennisP 4y ago

As a percentage of supply, Ethereum only issues about 10% as much as Bitcoin. On top of that, a portion of Ethereum fees are burned instead of paid to stakers. The supply is still slowly increasing, but at a (fairly modest) fee level of around 16 gwei the supply starts to shrink. The higher the demand for blockspace, the faster the supply shrinks.

greyface- 4y ago
"the PoS merge [...] will reduce issuance to the point where the ETH supply will begin to shrink" https://news.ycombinator.com/item?id=31826155 https://news.ycombinator.com/item?id=31826155 "the ETH supply will begin to shrink" https://news.ycombinator.com/item?id=29080421 https://news.ycombinator.com/item?id=29080421 > only issues about 10% as much 10% is 3 halvings. I'll take a nap.
- DennisP 4y ago
  After you're better rested, maybe read my second paragraph?