14 ms·

The Problem with Ethereum

440 points by myth_buster 5y ago

reactspa 5y ago
This article actually explains certain aspects of Crypto way better than actual articles that try to explain Crypto. E.g., I've been wondering why a certain Bitcoin podcaster, who is very popular, has never mined a Bitcoin. He/she talks all day about "stacking Sats", but he/she only buys them. Reading this article made me realize that he/she might see him/herself as a member of the ruling class.
- dheera 5y ago
  > I've been wondering why a certain Bitcoin podcaster, who is very popular, has never mined a Bitcoin The people actually mining Bitcoin don't have time for podcasts. Podcasts, Youtube, media in general are mostly dominated by people who don't actually do other work, because creating content for those platforms is extremely time-consuming.
- kristofferR 5y ago
  Bitcoin mining isn't something you can do on your own anymore. Unless you're accidentally located at a place with the cheapest electricity you'll have no chance. Not to mention the ASICs, by the time end-users can acquire them they're usually outdated.
- sanderjd 5y ago
  It's actually the opposite: even that podcaster is probably not wealthy enough to successfully mine a bitcoin. Bitcoin mining requires a big business and not even one that is easy to start wherever you happen to be; you have to have access to cheap electricity.
teruakohatu 5y ago
> working class — a group that does the work the community needs to operate it. It would be more correct to call miners a Merchant Class. They exploit capital to make profit. Like merchants of old, they take risks that regulations (real-world and the "ruling class") won't impede profit. Hardware gets outdated quickly as mining difficulty rises, so a timely exit is not difficult - wait until cards die, or offload them ebay. > As a Bitcoiner I find these actions intolerable and unacceptable Bitcoin has also forked, many times. Bitcoin Gold for example restored the ability to mine with GPUs. The "ruling class" decided that unless you had access to custom hardware, you could not be part of the "working class".
- Tenoke 5y ago
  >Hardware gets outdated quickly as mining difficulty rises, People can and still do mine Ethereum with the cards they did 5 years ago, and the difficulty is irrelevant to whether your hardware is outdated or not.
  - Tepix 5y ago
    If you run your mining rig in the Ukraine with stolen electric power, yes you can do that.
    - Tenoke 5y ago
      According to the nicehash calculator (which is fairly accurate) even with the really expensive electricity (0.34euro/kwh) in Germany you'll net 1.31 euro a day with a 1080 (released May 2016). https://www.nicehash.com/profitability-calculator/nvidia-gtx-1080 https://www.nicehash.com/profitability-calculator/nvidia-gtx...
- javert 5y ago
  > Bitcoin has also forked, many times. This is a false comparison. The bitcoin blockchain maintains the original monetary policy of bitcoin, which is effectively set in stone. That is not true of Ethereum, and that is the purported problem with Ethereum.
FeepingCreature 5y ago
Is there any network where the inflationary half-life of the currency is something like a week? I've been looking for something like that since I heard that Bitcoin was deflationary. (I was excited about Eth until I learnt its currency had persistent value...)
- dash2 5y ago
  Are you saying you would like to purchase and use such a currency? Or would you like other people to purchase and use it?
  - FeepingCreature 5y ago
    No, I would like to mine it. Imagine: a network where the only gains you get are from spending your money quickly. The anti-hodl. It would be completely worthless as a store of value or investment vehicle. Its only conceivable use would be as a fast and efficient transaction ledger. Which is what I wanted out of blockchain to begin with! I'd be happy to support a network like that, even if my income was rapidly vanishing.
    - dash2 5y ago
      Right... and who will be buying and using this money?
      - FeepingCreature 5y ago
        People who need fast, cheap, safe transactions rather than a value store.
        dash2 5y ago
        If a VanishingCoin will lose half its value in a week, and I buy and sell it in a second, using it as a fast cheap safe transaction, then my cost will be at least equal to (1/2)^(1 sec/1 week) of the transaction. VanishingCoin will be outcompeted by SteadyCoin, which is just as fast, cheap and safe, and doesn't lose its value.
DenseComet 5y ago
Seems like one of the core arguments of this is that the the core devs have pushed the difficulty bomb multiple times because they've missed their original timelines for switching to PoS without any repercussions. It seems to me that this is actually the correct thing to do. I'd rather the core devs take their time and iron out the issues instead of being incentivized to play fast and loose with a system that manages billions.
- fastball 5y ago
  The actual core idea seems to be that the core devs can do whatever they want without cooperation from miners, which is... the opposite of true.
  - Tenoke 5y ago
    Miners were very opposed to EIP-1559 and in the end when the talks failed they mostly just ignored them. It's kind of true.
    - latchkey 5y ago
      Not true at all. There was never any real consensus among miners on this front. As a very large miner, I was always for 1559 because I understand the underlying mechanics. The miners who I watched were just kind of bandwagon on the theme of "wait, I'll earn less cause you're burning my fees"? Which in reality isn't entirely the case (price and usage have gone up, along with the lack of wallet support).
      - Tenoke 5y ago
        The Community calls didn't reach agreement with miners, and the fact that they kept protesting it is why the Ethereum Foundation decided to move the ETH 2 timeline forward. https://cryptobriefing.com/ethereum-miners-protesting-eip-1559-has-accelerated-upgrade-eth-2-0/ https://cryptobriefing.com/ethereum-miners-protesting-eip-15... >As a very large miner, I was always for 1559 because I understand the underlying mechanics. I don't know what mechanics you think others didn't understand. Your profitability has dropped and the move is basically moving miners' profit to the largest holders (e.g. everyone who pushed for the change). It's not like the fees have dropped since EIP-1559 if that's something you thought the change will bring for some reason.
dash2 5y ago
"Something here seems awfully similar to the system that crypto-currency was meant to fix. It was meant to eliminate rulers. It was meant to make everyone accountable for their actions. It was meant to reward the intelligent, the hard working and the capable, and not reward the incompetent, or the makers-yet-breakers of promises. However, this repeat of the broken old system seems to be playing out again." One response is that the promise was not well thought through. The idea was to replace "rulers" (human beings who make decisions to take care of a system) and "law" (written rules interpreted by humans) with code. But (a) code is written by humans who make mistakes; (b) the world changes, and systems need to update to respond to that; (c) somebody has to be responsible for dealing with a and b. As a result, currencies need central organizers to look after them. And those central organizers need to be motivated, i.e., paid. Old-fashioned currencies have sovereigns to back them, and the sovereigns are paid by the monopoly of taxation and/or the ability to issue money. Inefficient, but it works. From this perspective, bitcoin et al. look like technical solutions to social problems. In particular, bitcoin is designed to have nobody taking care of public goods problems on its behalf. That's a flaw![1] [1] https://wyclif.substack.com/p/thought-bubble-defending-bitcoin https://wyclif.substack.com/p/thought-bubble-defending-bitco...
- agumonkey 5y ago
  Also, humans or not, in any given system, there will be people in position to analyze and take advantage of subtle / indirect / emergent effect of that system. Be it better brains, more funding to try strategies, it will happen.
  - deleted 5y ago
    [deleted]
  - hiddencache 5y ago
    Is that a bad thing? Maybe that's how systems become more efficient.
    - agumonkey 5y ago
      Depends on which side you're on. The big smart may again take advantage of the rest.
fastball 5y ago
> Something here seems awfully similar to the system that crypto-currency was meant to fix. It was meant to eliminate rulers. It was meant to make everyone accountable for their actions. It was meant to reward the intelligent, the hard working and the capable, and not reward the incompetent, or the makers-yet-breakers of promises. However, this repeat of the broken old system seems to be playing out again. Was it? Most of these goals were definitely not talked about when Bitcoin was first invented, and to this day I wouldn't say this is the list the vast majority of people in the crypto space would come up with if you asked them what the point of cryptocurrency is.
tpae 5y ago
It takes a lot to build a community. The way that article portrays it ties more into an allegory. Let's not forget that every participant is there voluntarily, and if they are genuinely suffering, they will choose to move on. Ethereum is a powerful connecting force that brings trust within the internet.
- void_mint 5y ago
  > Ethereum is a powerful connecting force that brings trust within the internet. I've got a bridge to sell you when you're ready
  - muzster 5y ago
    Off Topic: In case anyone is not familiar with the phrase : "I've got a bridge to sell you when you're ready" (1) A con artist who sold a bridge. https://en.wikipedia.org/wiki/George_C._Parker https://en.wikipedia.org/wiki/George_C._Parker Not to be confused with :- (2) Rumoured that the wrong 'London' bridge was sold to Arizona (vs Tower Bridge) https://www.history.com/news/how-london-bridge-ended-up-in-arizona https://www.history.com/news/how-london-bridge-ended-up-in-a... It could be argued that both apply - but I'm not getting into that argument !
  - spacedude99 5y ago
    Luckily I can afford the bridge having bought Ethereum years ago.
    - elevenoh 5y ago
      ouu not a bad attempt with the dash of humour included, but overall little tasteless here. you'll improve at this ;)
    - void_mint 5y ago
      Luckily I can afford the bridge having bought Baseball Cards years ago
Sevii 5y ago
I emphasize with the arguments here but I differ in my conclusion for two reasons. 1. I don't own just Ethereum, its not a boat that I'm riding in, its one of many gambles I'm making. 2. The Ethereum network has generated a ton of really good stuff (Smart Contracts, DEFI, NFTS, IPFS, ENS, etc) despite whatever governance problems it has. Cryptocurrencies are far from mature. There is no guarantee eth and btc will still be valuable in 10 years. They could be replaced entirely by new chains with different software.
- latchkey 5y ago
  10 years ago I didn't think bitcoin would be here today. Yet, here we are. If we waited for everything to be mature, then we wouldn't have used web browsers in the early days. I remember when people were afraid to put a credit card into a website. Bitcoin and ETH won't get replaced for the same reasons we ended up with Hacker News, Facebook, Google, Apple, Ebay, Amazon... network effects are amazingly strong. Bitcoiners use the phrase: "The next bitcoin is bitcoin."
  - sanderjd 5y ago
    It's hard to know when something is Facebook, Google, Apple, or Amazon vs. when it's MySpace, AOL, Palm, or pets.com!
    - latchkey 5y ago
      If you put it that way, then that explains all of the failures before bitcoin, of which there were many 'digital cash' attempts.
- kristofferR 5y ago
  IPFS isn't connected to Ethereum as far as I know.
- caf 5y ago
  Even when gambling, I don't gamble on a crooked table.
phase5 5y ago
Here's some other articles on the problems with Ethereum: https://github.com/libbitcoin/libbitcoin-system/wiki/Proof-of-Stake-Fallacy https://github.com/libbitcoin/libbitcoin-system/wiki/Proof-o... https://hugonguyen.medium.com/proof-of-stake-the-wrong-engineering-mindset-15e641ab65a2 https://hugonguyen.medium.com/proof-of-stake-the-wrong-engin... https://hugonguyen.medium.com/work-is-timeless-stake-is-not-554c4450ce18 https://hugonguyen.medium.com/work-is-timeless-stake-is-not-... https://medium.com/hackernoon/sharding-centralizes-ethereum-by-selling-you-scaling-in-disguised-as-scaling-out-266c136fc55d https://medium.com/hackernoon/sharding-centralizes-ethereum-... https://blog.lamden.io/turing-incompleteness-and-the-sad-state-of-solidity-d5278ba4eda0 https://blog.lamden.io/turing-incompleteness-and-the-sad-sta...
cliftonk 5y ago
That this gets upvoted to #2 speaks poorly of HN. Why on earth are we still talking about the DAO? This is a collection of tired, irrelevant arguments that entirely ignores product-market fit and a large, vibrant community of developers. [edit] ah, of course. a bitcoin maximalist. how dare there be an alternative use-case for crypto that involves people using it. the thing bitcoin has going for it is a large community of peripheral people believing it will be the global reserve currency (it wont).
- dcow 5y ago
  Uhmm.. what product market fit? And why is proof of steak good?
  - darthrupert 5y ago
    I prefer, nay, demand proof of cake!
  - BLKNSLVR 5y ago
    Proof-of-steak is quite satisfying to pass. And since I'm committing to this literal shitpost, the proof-of-steak misspelling is entirely appropriate to the amount of salt in the article.
  - deleted 5y ago
    [deleted]
  - TimJRobinson 5y ago
    $100B+ invested across hundreds of decentralized apps, with exponential user growth, is absolutely product market fit - https://defillama.com/chains https://defillama.com/chains
    - arcturus17 5y ago
      Nothing about that says product-market fit beyond the speculative use case - which I would agree does show spectacular product-market fit since it is proven there are tons of people willing to speculate and crypto provides an asset class with attributes that people are really craving (poor regulation, high risk and volatility, etc.)
dcow 5y ago
I lost interest in Eth when the “code is law” law was broken. I’m glad I did. I don’t believe proof of steak is the correct solution to the energy required for proof of work. To be clear, a lot of good insight has come from Eth, but I’m not ideologically bought in anymore. Recently I have been exploring Chia as a farmer. Rather than the ruling class being a group devs and random early miners, the ruling class is a (soon public) corporation. At least a corporation has a clear legal structure of existence in a capitalist society. I see it as a sort of anchor between a purely cyber community and the actual world we subject ourselves to. I can buy shares in a corporation if I want to participate in the ruling class. The ruling class has legal agency to increase the value of its share price, which is the dual of it’s the underlying asset. Farmers still make less over time but the logistics are clearly laid out in detail, and TX fees kick in to supplement. Maybe it too will all go up in flames, but until it does I’m along for the ride. I believe we can sustain a proof of work system that is orders of magnitude more efficient than constantly running sha. And personally I feel “crypto” has had enough iterations that it’s about time to pick an innovative one and throw some labor behind it.
- latchkey 5y ago
  As far as I understand it, Chia suffers from the problem of just filling hard disks with useless data. https://www.backblaze.com/blog/chia-analysis-to-farm-or-not-to-farm/ https://www.backblaze.com/blog/chia-analysis-to-farm-or-not-... Filecoin is a more viable and useful option imho.
  - dcow 5y ago
    There are way more HDDs lying around needing to be used than GPUs, though. Storage is so much easier to come by. File coin has structural problems like you cant mine filecoin without first buying filecoin to stake…
    - everfree 5y ago
      > File coin has structural problems like you cant mine filecoin without first buying filecoin to stake Why do you consider this a structural problem?
ineptech 5y ago
This is overlong and pretty florid, but its conclusion (that a long record of forked changes, each being good for big ETH holders but bad for miners, is roughly equivalent to the self-dealing of wealthy insiders in the traditional financial world) doesn't seem wrong.
- kristofferR 5y ago
  The distinction he makes between miners and holders seems totally arbitrary in my view, it's not like the miners aren't also holders. The more you mine the more you hold.
- secondaryacct 5y ago
  Anyone who thought differently when crypto appeared was most likely young and naive. If a system deal with effort credit, some will find ways, whatever rule you think they follow, to get more credit for less effort. There s no solution, it s the basic of energy limitation: you have an enormous incentive to conserve energy until we can get so much more than we require with so little spending that it becomes irrelevant. But then, we ll find ways, probably, to spend so much energy that we ll reach the limit again. A bit like in the 2000s when you kept doubling your disk drive space every year and still kept filling it at exponential rate :D
- chrisco255 5y ago
  Why is it wrong? Ethereum has had the plan to move to proof of stake for years, and the purpose of the network is to serve its users not to enrich miners. We pay miners for security. That's great, but if we find a cheaper way to do security, there's nothing wrong with choosing a different security solution.
- everfree 5y ago
  Miners are contractors. They have no stake in Ethereum's long-term success unless they become ETH holders as well. Ether's price has risen exponentially. It doesn't make sense (and isn't necessary) to pay miners exponentially higher amounts of money to do the same job, thus the issuance reductions.
kristofferR 5y ago
> As a Bitcoiner I find these actions intolerable and unacceptable. I know none of them would ever be accepted in Bitcoin. This sums up the whole piece in my view. Bitcoin development stagnated years ago exactly because nobody involved wanted to change/hard fork it to implement improvements. For people who want a Bitcoin-like Ethereum with no DAO fork or staking there's Ethereum Classic.
- tofukid 5y ago
  https://github.com/bitcoin/bitcoin/commits/master https://github.com/bitcoin/bitcoin/commits/master I wouldn’t consider that stagnate.
  - kristofferR 5y ago
    Sure, it's just moving very slowly after the block size civil war. I remember the early years when the talk was about interesting developments instead of just the value.
    - javert 5y ago
      Bitcoin has chosen consistency with its original principles over "innovation." A good choice, in my book. What we should think of as constituting sound money has not changed since 2008. That is what bitcoin is supposed to be - sound money. Ethereum is supposed to be something else - and it makes sense for Ethereum to "innovate" much more than bitcoin does.
      - Tepix 5y ago
        > That is what bitcoin is supposed to be - sound money. Bitcoin can't be used as money in most cases as transactions are too expensive and slow. It has failed its primary function. Instead of doing something about it, the notion of using bitcoin like money has been abandonded and it's merely a "store of value". That's until people stop valuing it.
        5y ago
seibelj 5y ago
The great part about cryptocurrency is that if you don’t want it, don’t buy it - don’t read about it - don’t do anything. It is a purely voluntary system. If you want to avoid US Dollars, it’s essentially impossible for most people. There is no problem with Ethereum.
- smt88 5y ago
  You're correct in the financial sense, but not socially. I can't entirely opt out of crypto because people around me are making or losing (mostly losing) money it. Mining also pollutes air that I breathe and accelerates climate change. Regardless of whether you think these external effects are worthwhile, they exist and are unavoidable.
- lxgr 5y ago
  Except if you want to buy a GPU today.
- perryizgr8 5y ago
  Except miners slurping up the entire limited GPU supply means I haven't been able to afford a proper graphics card for about 3 years now.
hamburgerwah 5y ago
Ethereum is and has always been the toy of Vitalik Buterin and his cronies. They control roughly 64% of all ETH. Everyone else is just share cropping suckers.
- BLKNSLVR 5y ago
  From what I've read and heard of Vitalik Buterin, he seems most unlikely to have "cronies". The reason Charles Hoskinson left the Ethereum Foundation is that Vitalik wanted it to be non-profit, whilst Charles wanted it to be commercial / for-profit. Most of what I've heard of Vitalik paints him as having a saint-like aura (my own admittedly hyperbolic description). But then maybe we'd all appear that way if we had $billion resources at hand...
  - deleted 5y ago
    [deleted]
  - javert 5y ago
    Vitalik is a saint in comparison to Hoskinson, but that doesn't mean Ethereum is sound money. It is what it is; lots of good innovation there, but sound money, it is not.
    - whitepaint 5y ago
      None of the cryptos are sound money ("money not liable to sudden appreciation or depreciation in value") except stablecoins on Ethereum. Bitcoin can easily lose 80% of its value in a month and no one would be surprised. Bitcoin is the biggest speculative bubble of all time. It absolutely has no utility (imagine if Bitcoin disappeared now - what would the world lose?). The actual real exciting stuff regarding the cryptos is here: https://ethereum.org/en/dapps/ https://ethereum.org/en/dapps/
      - javert 5y ago
        Bitcoin can be sound money after the price stabilizes, which will probably take decades if it ever happens. Nothing else in the world ever could be sound money except commodity money, like gold, but I'd argue that bitcoin is better.
Havoc 5y ago
Author is looking for perfection in what is essentially a Wild West. I also think it’s asking the wrong questions in a way. Whether Bill Gates should have made billions or not whether he should be in charge and corporate structure is largely irrelevant to Silicon Valley crushing it. Fairness equitability and consistency would be nice but is not compulsory at all
- javert 5y ago
  Bitcoin itself isn't the Wild West, and that's part of what the author is saying.
Apofis 5y ago
The only value argument of Etherium over Bitcoin is that you can have computation on the blockchain, which is a joke when you consider AWS and Azure exists. The rest are delusional details.
- chrisco255 5y ago
  Could you explain precisely, how you might build a $350 billion plausibly neutral, open source, non-gated, cryptographically secure blockchain and smart contract platform with 100% uptime over 6 years on AWS and Azure?
swayson 5y ago
Human greed is the problem. How much of promising tech, starts out so innocent till big money becomes aware of it or those who want to make a quick dime, tarnish principled thinking and action.
- imtringued 5y ago
  Cryptocurrencies are just as bad as the fiat they replace. The problem with fiat is that people use it as a high score to measure their own status/rank. But it is also needed to pay people. But people only work if they get paid. You run into the money shortage problem that caused so much trouble in 2008.
sarah180 5y ago
There are good points here, but I think analogizing the situation into a class struggle within a society is both confusing and specious. Ethereum is not a civilization: it's a piece of FinTech.
miguelmota 5y ago
If something is hard in theory, it's 10x harder in implementation. Complex systems have a lot of 'unknown unknowns' that can't be forecasted. Ethereum is $300B+ live network so every small change takes time to research, test, and implement. Migrating from PoW to PoS is like swapping out the engine of an airplane in mid-air.
- jstx1 5y ago
  If you ask the cryptocurrency subreddit, the best thing to do with any money you have[1] is to buy ETH at any price and stake it (i.e. lock it in and receive interest until ETH 2.0 is released). I find that absolutely mindblowing given all the complexity you're pointing out + the fact that there is no date and no clear explanation of what happens to the funds in the event of failure. And on top of this the fact that most people are doing the staking through exchanges because they don't have the required 32 ETH to do it themselves, it looks like a giant disaster waiting to happen. And somehow Ethereum is one of the most positively viewed cryptocurrencies out there. I don't get it. [1] This is only a mild exaggeration.
  - pshc 5y ago
    ETH2 is going to happen sooner or later… The beacon chain already works in production so it seems inevitable the devs will merge mainnet onto it. Not completely convinced about their 2021/2022 timeframe. All the validator deposits are public data; how would they be destroyed? The funds will have to be unlocked at some point, people will demand it.
    - jstx1 5y ago
      > The funds will have to be unlocked at some point, people will demand it. This seems contrary to everything crypto claims to be about. "Just trust them, surely you'll get the money back"
      - pshc 5y ago
        I believe in them to deliver eventually. Would you be interested to place a long bet?
acjohnson55 5y ago
Did Ethereum ever make a promise that "code is law"? The references I'm finding are all in Ethereum Classic docs. Fair point to the author for finding the dynamic nature of Ethereum's progression not to their liking, but it's a real reach to portray it as some kind of class conflict parable.
animex 5y ago
I think if anything the crypto-experiment has revealed is that an uncaring, cold machine doesn't meet the needs of the human condition. A person fat-fingers his life savings to null, a thief socially engineers someone's money, a bug causes assets to be trapped, etc. It's clear we need a better system that can service our imperfections.
- casi18 5y ago
  and things like social wallets and trust networks as a response to those issues are emerging as the best way forward, less seed phrases and hardware wallets with tiny buttons. connecting with friends is the best security. turns out ethereum is a social network with a very fast uptake worldwide. it shows us that community and support for one another is the Layer 0 that these things are built on top of. code isnt law, people come first. if we stick with that it could work pretty well.
- jkhdigital 5y ago
  Unfortunately we live in an uncaring cold machine (the natural universe), which is ignored or hand-waved away at our mortal peril.
ceilingcorner 5y ago
Calling miners “the working class” is a misleading label no doubt chosen to instill sympathy. By that measure, factory owners in the industrial revolution were the working class.
silasdavis 5y ago
There's plenty wrong with Ethereum, but casting miners as 'the working class' is a flawed analogy. The mercantile class would be closer to the mark. Notably, their hashing power is based in real world economic power and they extract an annuity from capital expenditure on mining operations and hardware. I also question whether miners are really providing the labour power, as you might expect the working class to do. They build the roads and keep the lights on but the means of production of value is (or ought to be) the services provided by those writing functionality that makes the network useful, i.e. the smart contract writers. Whether one thinks smart contracts on Ethereum have any value is another question but that was at least the vision. A move to proof-of-stake does not remove the role of miners/validators. Validators will still earn a reward from validating blocks. So it's not as if this 'class' is being disenfranchised totally. Finally the social class analogy entails disjointness of classes, this is certainly not the case for miners, many of whom are major token holders, and some of whom are involved in governance (of course by miners we are taking about the humans controlling the mining rigs not the computers themselves)
- denton-scratch 5y ago
  > There's plenty wrong with Ethereum, but casting miners as 'the working class' is a flawed analogy. Agreed. Marx's working class consists of those who do not own means of production, and are therefore compelled to sell their labour. Miners do not lack means of production; they operate expensive mining machinery. That machinery continues to run, and earn money for the miner, even while the miner sits on the beach. Selling their labour really isn't a good model for what's going on. Miners are just ordinary capitalists, exploiting a market opportunity.
  - Dylan16807 5y ago
    And there's a fixed amount of mining labor to be done, requiring far less than 1% of the current effort spent. So why are the pay cuts a problem? (Especially if you chart payout in USD.)
  - dragonelite 5y ago
    The two class cycles workers cycle: Commodity(labor) -> Money -> Commodity(food, housing bills) Capitalists cycle: Money -> Commodity(means of production) -> Money(profit/surplus value) At least that is the bit that kind of sticked to me and made me realized in the west you want to do the second cycle. Earn money by selling labor, live life as a cheap ass for a while use savings to become a asshole landlord.
msaadat 5y ago
> By burning the working class’ money, the ruling class and wealthy class end up with a larger piece of the overall pie. It’s ingenious. Evil, but ingenious. The arguments in the article would have carried more weight without the loaded language. Miners are more like banks in a fiat system rather than 'working class'. Pay cuts for middle-men means increase in efficiency of the system. Very evil indeed.
shp0ngle 5y ago
Who the hell cares. Crypto people were warned repeatedly, since 2017 (and arguably even sooner), that this is all a scam and they should not put their money there. They ignored those messages for years, put the money there anyway (because the number goes up), so, tough luck. Articles "network XY is more decentralized than network YZ" are boring.
- jl2718 5y ago
  Because at some point the banks will fail and one of these ‘scams’ is going to be necessary for you to get along in life. I’m sorry that this is the case; I really wish that the system we live in was sustainable, but it’s not, and it probably won’t be reformed before it’s too late. Maybe this is a matter of opinion, but it happens to be the most common opinion of people that have studied the matter without incentive to believe one narrative. I have never seen a well-informed defense by an independent writer that did not rely almost exclusively on appeal to authority. There are opportunists. There are scammers. That’s not how this thing got started. We started this to mitigate an unstoppable problem. I personally never liked many economic aspects of the Bitcoin protocol, and dismissed it very early. I know many others that aped into mining a fortune based on much less understanding. I’m now willing to accept that it is the least bad of likely candidate solutions, and the reason for that is that all newer entrants cannot gain relevance without massive investment, which means owners from the old failing system.
  - meowface 5y ago
    I'm generally optimistic about cryptocurrencies, but these kind of catastrophe scenarios where cryptocurrencies play the role of savior have always seemed pretty silly to me. If the US dollar collapses or experiences hyperinflation, and/or US banks all collapse, pretty much everything is going to be fucked everywhere, most likely. Especially because whatever's driving that catastrophe is probably disrupting lots of other things, as well. (A major war, for example. The global Bitcoin/Ethereum/etc. networks might become disconnected and fragmented in those scenarios. Let alone infrastructure for fiat exchanges or paying for things with cryptocurrency.) I think these events are very unlikely to begin with, yet a lot of cryptocurrency maximalists speak as though they're likely or inevitable in the mid-term or near-term. But if they do actually happen, I think digital currencies are going to be the least of almost everyone's concerns at those times.
kokizzu3 5y ago
still related: https://www.youtube.com/watch?v=Ykyd4iRi5yc https://www.youtube.com/watch?v=Ykyd4iRi5yc
- skinnyasianboi 5y ago
  Maybe it was relevant 3 years ago but imo at least 4 of his 6 points are not valid anymore
Ericson2314 5y ago
The idea that anyone who is concerned (at least via analogy) about dealing with inflation by knee-caping wages wants to boost bitcoin is, frankly, hilarious. Ah, baby's first step.
csomar 5y ago
> Excuses are made and explanations are given as to why in this particular case an exception needs to be made to the “Code is Law” promise I really wonder what Ethereum investors think of this. A "precedent" was made. Crypto has yet to come to the real test with governments, courts and the physical laws of humans. With Bitcoin, it can be stipulated that changing the network is impossible or unheard of; but that's not the case for Ethereum. It doesn't help, also, that the network is being "processed" by a few elites (or pools of wealth) that could be, potentially, identified and made to obey the "government/s". This is not the case of Bitcoin where the introduction of KYC for mining will require a hard-fork. Bitcoin (the core chain) has never undertook a hard-fork (which is why a lot of Bitcoin forks are out there).
- whitepaint 5y ago
  Majority should decide. Majority decided. Majority will decide. I completely agree with this.
- nootropicat 5y ago
  >This is not the case of Bitcoin where the introduction of KYC for mining will require a hard-fork. That's not true, introducing full kyc for transactions only requires 51% of hashrate. >It doesn't help, also, that the network is being "processed" by a few elites (or pools of wealth) that could be, potentially, identified and made to obey the "government/s". A direct opposite is true. PoW is extremely vulnerable to a government takeover. Even in the worst case, buying majority of hashpower requires few billions at most - which is well within the ability of many countries. More practically, overwhelming majority of mining is done by registered companies in impossible to hide industrial warehouses, making them trivial to regulate and force to do kyc. Total fees are very low on bitcoin now, meaning it's more profitable to mine even empty blocks (due to kyc requirement) in a place with cheap electricity than try to mine with transactions in a place with more expensive electricity. Additionally, America is notorious for trying to enforce its jurisdiction globally, so eg. European miners processing kycless American transaction may find themselves in an American prison. Even if their countries won't extradite them, all it takes is a vacation in a wrong country. Chinese ban on mining has ironically made miners-enforced kyc a much more likely prospect. Other countries are much more likely to cooperate with America and jointly force miners to enforce kyc. Contrary to PoW, PoS can function purely anonymously - invisible home nodes instead of big industrial warehouses. External attack by buying enough stake is impossible - there's simply not enough for sale over any realistic periods of time. Regulation is infeasible because legal escape is in theory possible even if only one tiny place in the world remains without forced kyc - there's no need for GWs of power, just some power and internet. Even in countries where it's illegal, hiding a home node is realistic - using tor, vpns and similar, making enforcement very hard. Hopefully kyc laws on block generation aren't actually enforced as that would significantly impact adoption, however, if they were actually to happen, you are going to see bitcoin miners enforcing kyc while eth2 PoS continues unchanged.
mypastself 5y ago
If nearly half the text is bolded, what’s the purpose of the boldface? I feel like there’s a 51% font attack brewing within the article. Regarding the content, the class allegory itself can go the other way as well: the core developers can be thought of as the workers, the miners are the owners of means of production etc. The one point that’s relevant is the rule-making: the DAO hack hard fork has proven that Ethereum’s boasts of decentralization are dubious at best.
- stackzero 5y ago
  +1 for 51% font attack
- xtracto 5y ago
  Looks more like the zebra striping for tables: its there just so that you can differentiate paragraphs
nootropicat 5y ago
Miners are most definitely not the working class and they're not doing any useful work. This sounds harsh because most individual miners aren't hostile in any way - but if miners were a one entity, there would be no exaggeration at all. Collectively, paying miners is like paying the mob to not destroy the system, as they are only group with the power to do so. Without miners at all attacks would be impossible. 51% attacks on ETC show that the threat is real. The working class are users - people using and building on ethereum. Their wealth is continuously drained by the mob, but there is hope - a wall staffed by militia is being slowly erected. It's called proof of stake, and once finished, the mob can finally be told to fuck off. In the meantime the absolute value of protection money paid to the mob has grown several times, making it possible to reduce the protection payments percentage rate without impacting security of the people.
- Tepix 5y ago
  Miners are not doing any useful work is incorrect, they are securing the system.
  - elevenoh 5y ago
    Yeah folks don't seem to realize every monetary system requires 'sacrifice' for its security (whether this is lock-up of capital, work etc.) The market most efficiently determines whether [& which] to sacrifice (e.g. computation or capital lock-up) is worthwhile.
    - mandmandam 5y ago
      The market has not efficiently determined that though. _Objectively_ better alternatives to Bitcoin are around for at least the last five years. No one can realistically argue that it's better to have a system use 6 million times more energy, cost infinitely more, and require waiting 16 minutes for a confirmation compared to less than a second. "The market" is chock-full of inertia, vested interests, propaganda, sunk costs, and technical ignorance. There are literally thousands of cryptocurrencies - and the majority are scams. What has "the market" done to protect people? I say all this to do my part to improve "the market", but my estimation of the market's ability to efficiently determine its arse from a hole in the ground is low. Other examples of "the market's efficiency" include tobacco companies responsible for killing millions making bank for decades by fudding science, energy companies fudding data for decades to burn the planet while making billions, monopolies, duopolies, externalised costs, racketeering, collusion, collateral damage, etc etc etc.
horrified 5y ago
I would imagine most Ethereum miners are pretty well off by now, so the "working class" analogy is really off. Also "the ruling class" can not really force their rules on others. Everybody participating in cryptocoins right now is hopefully aware that it is an experiment with uncertain outcomes. So the "promises were broken" thing doesn't really convince me, either. I don't think the users of Ethereum were promised a finished product. "Code is law" also only applies if people accept the law. In the DAO case, people decided to change the law, or stick to Ethereum classic.
darkFunction 5y ago
> No moral questions are seriously considered about whether changing this rule is a breach of the promise made at the time of the constitution of the community. This is patently untrue. These questions literally split the community. The majority chose a direction and moved on.
amarant 5y ago
A lot of comments here criticise the analogies made in the post. While the criticism might be correct, I feel this is like missing the forest because of the trees.. Etherium, and most crypto-currencies for that matter, were initially made to fix a broken financial system, where banks unjustly control too much wealth, and changes the rules so that they will always control too much wealth. Etherium does not fix this, it merely copies this system, with all its flaws(and some new ones). That is why etherium is pointless. It does not provide value to society, as it utterly fails to solve the problem it identified. There is no other crypto-currency that does solve this problem, but then I guess some of them never tried to in the first place.
- ikt 5y ago
  > Etherium, and most crypto-currencies for that matter, were initially made to fix a broken financial system No? Buterin argued to the bitcoin core developers that Bitcoin and blockchain technology could benefit from other applications besides money and needed a more robust language for application development that could lead to attaching real-world assets, such as stocks and property, to the blockchain.[15] It's like you're trying to describe Ethereum from what bitcoin fanboys have told you.
  - jstx1 5y ago
    I think that you're confusing money and finance. In addition to being money (like Bitcoin), Ethereum is clearly doing a lot in the space of finance - that's the whole point of DeFi (it's also supported by what Vitalik said according to your own comment).
  - amarant 5y ago
    But the only kind of application that would even theoretically benefit of running on the Blockchain is a finance application, and it's not better at that than the current system. In fact, it's worse. The whole idea of "code is law" is deeply flawed, and I think the hard forks prove that. The problem then is that smaller financial injustices that do not get the attention of the core Devs, will go unchecked and unfixed forever. The idea of zero trust financial applications is intriguing, but in practice "zero trust" means "trust Vitalik", and to be honest, I trust my current bank more than I trust some random dude in the internet, thank you very much. (Not that I'm a fan of my current bank, they suck, just slightly less than any alternative I'm aware of) I know some people develop other kinds of applications too, but I completely fail to see the point of running (for example) a video game on the Blockchain other than the novelty..
unknownOrigin 5y ago
Oh boy, I see the crypto market is on the rise again so it's time for the HN crypto hot takes to grace our eyes yet again. We get it alright, crypto bad.
stackzero 5y ago
bitcoin maximalism is the worst. wealth will tend to concentrate over time anyway (parteo distribution) and a "ruling class" will emerge on bitcoin. miner's voting with hash power is not the future of cryptocurrency governance. If bitcoin does not evolve to allow this effectively it will be regulated out of common use. It's possible to experiment and build decentralized governance models directly into blockchains see e.g. https://polkadot.network/polkadot-governance/ https://polkadot.network/polkadot-governance/ (disclaimer not a shill I like the tech)
- throw2500 5y ago
  The problem: the libertarian ideology that inspired Bitcoin explicitly denies that there can be a ruling class because free markets are optimal, distributed, and stay free forever. But a Pareto distribution is kind of the default wherever people interact. So a system needs to be deliberately constructed to counteract it, if that's its goal. And saying "praise the market" won't be enough.
birdyrooster 5y ago
Everything wrong with crypto is the notion you can make a global reserve currency impervious to special interests. It’s going to be gamed by the people at the top, they will use all and any leverage to change the code to favor them more. They will extract the value from the system like they have every other system and the easiest part is that stakeholders like you and me don’t get any vote. You can’t decouple monetary policy from governance, it just isn’t sustainable. Fiat will always be better for the stability of finance and governance bc citizens (stakeholders) perceive or have a tiny lever of control. Crypto gives you no control as a citizen, and you will become discontent with the impotence of your lawmakers to pay for laws having no sway over the system preventing them from spending. Keynes hasn’t been disproven yet and so deflationary currencies are pretty much insanity, the business people will turn every deflationary coin into their own inflationary piggy bank. History proves me right. National governments the world over will gladly ban crypto before raising income taxes. They have backed themselves into this corner with the central banks and they won’t be able to resist its ease.
- elevenoh 5y ago
  >Everything wrong with crypto is the notion you can make a global reserve currency impervious to special interests This ain't binary. Ain't yes or no. Also.. why do you assume crypto is gunning for 'global reserve currency'? Crypto enables all types of experiments toward reducing the insider-asymmetry nature of central control control (e.g. political whim money printing, political whim monetary policy) >Fiat will always be better for the stability of finance and governance bc they perceive or have a tiny lever of control Political, centrally controlled money shifts economic risk from away from markets/market participants (the most efficient distributed value-computation we have) onto politically-determined populations. example: fiat policy shifted 2008 wall street bankruptcy risk away from markets onto ordinary people who're being inflated-away & exploited by the Cantillion Effect.
  - birdyrooster 5y ago
    The only reason Michael Saylor is telling people to mortgage their house and sell their stonks to buy BTC is because he and a bunch of other whales are gunning to make BTC the world reserve currency. You see this mentality everywhere and it is the only way these coins are going to go to the moon. Not to mention a lot of these people are libertarians who see this as their way to “fix” the problems of central banks. Certainly our politics leads to the socialization of corporate risk, but crypto is subject to the same politics only with a much smaller pool of voters. Spending on any community at this global scale will be looked at as pork and the needs of disenfranchised will calcify further. Again, it’s code and it’s not immutable. The mechanisms of distributing crypto clients will betray the interests of the common citizen. There is no leverage for commoners, only special interests. Inflation could be used to redistribute wealth for greater equity and the worlds wealthiest see this threat which I think is the only reason crypto has their attention.
dalbasal 5y ago
The social class metaphor is stretched pretty thin, but it can be interested to follow such threads and see where they lead. I suppose it's endlessly interpretable, but here's my take on bringing it down to earth. - Different "classes" have different interests. (1)Miners. (2) Big, rich coin owners. (3) Rule makers and influencers. Group 2 & 3 overlap and might collaborate to screw miners. - The author is thinks fundamentals/promises like "code is law" and such will gradually crack, because absolute adherence will be broken. - Rule making is corruptible. "sounds just like the corrupt fiat money system we’re trying to escape" Sounds to me like you have arrived at "governance." The hope a lot of people had/have for crypto is that it replaces people, institutions and rules with explicit code. Coins would be governed by code instead of people, which works until it doesn't work. Since this is already framed in a historical materialism sense... Imagine a society where all laws come from God, are engraved in stone and adjudicated with trials by duel, ordeal or some other way of leaving things in His mighty hands. This works until it doesn't. A currency crisis leaves 90% of people in debt slavery, and the army can't find enough recruits. A UFC champion is abusing trial by combat to get away with all crime and rob everyone. Stuff no one could have foreseen. One of the rules isn't perfect. IRL, such societies will go one of two ways: (1) They have systemic instability, where the stone tablets can be broken and new rules adopted. Or, (2) they fudge. They have a complete and perfect constitution, and a supreme court that interprets it liberally like the US. Maybe they pretend to have a constitution even though one has never been written, like the UK. It turns out we can make that guy fight a bear instead of some poor prisoner. There's a theoretical option 3: adhere. Play out the consequences whatever that requires. Maybe god wants everyone in debt slavery, and that ufc champion running around robbing old ladies. Everything crypto seems to drive to the extremes. An obsession with perfect. There is no perfect. Say smart contracts work great for collectible sneakers. Yes, it collapses when a judge rules to give a sneaker collection back to a guy that got robbed. Does that really make it worthless? Is an institution responsible for cancelling and issuing sneaker coin, on court order, really such a blasphemy?
- pattusk 5y ago
  > "The hope a lot of people had/have for crypto is that it replaces people, instititions and rules with explicit code" My experience in crypto over the past two years has been exactly the opposite. The main issues facing the space today all have to do with governance: how do you get holders of gov tokens to vote rather than hold? how do you involve them in the evolution of your protocol? There are entire protocols being designed to allow "vote selling" to incentivize delegation for small owners. Code is a tool to make sure laws are enforced. But the rules are increasingly being made and amended at the social/political layer. It may not be democratic. it may not be fair. it may not be efficient. but it's a damn interesting experiment to watch evolve.
jaked89 5y ago
Early crypto adopters are freedom minded people. I have no problem with a new economic system where the wealthiest are the most freedom-oriented. If crypto ever replaces the current monetary system, late adopters will have to fight for crumbles. And that's OK; you support deception & violence, so you stay poor. That's cosmic justice.
- kevingadd 5y ago
  So if I'm understanding you correctly, "late adopters" including people who don't have money for mining hardware/coins or don't even own a computer, just a phone - deserve to be poor because not buying in to crypto is supporting "deception and violence"? What's the logic here?
  - iSnow 5y ago
    The logic of Bitcoin maximalists who already revel in dreams that one day, they will relocate to remote islands or citadels while watching the world burn down. Any human with a moral compass would shudder at the thought of a collapse of Western democracy, but not them: they giggle in anticipation of becoming the new ruling class or at least an exclusive society of mega-rich while those who doubted the Bitcoin religion will have to prostitute their daughters to the nouveau riche. "Have fun staying poor" is their battle cry. In their twisted libertarian world view, people forced by hunger to toil day in, day out is not violence, but the state taxing incomes is.
  - jaked89 5y ago
    Strawman attack. I didn't mention mining; anyone can purchase crypto. If you prefer to support the fiat thugs by holding into their tokens, be ready to pay the price.
gorgoiler 5y ago
Cryptocurrency is so unfair. Who do these people think they are, trying to push upon us a new gold? If a new value exchange mechanism is to be invented, it really ought to be one that doesn’t slyly concentrate billions of wealth into the hands of a few. There’s plenty ways of doing that already thank you very much.
- casi18 5y ago
  > Who do these people think they are, trying to push upon us a new gold? it is completely opt in, you don't have to participate. which seems better than the money governments say we have to use (because they are in control of it and can use that power to maintain control of people). > one that doesn’t slyly concentrate billions of wealth into the hands of a few. lots of people in crypto very open to any ideas or suggestions you have to solving the matthew effect, non-coercive tax systems, and public goods funding. genuinely, any community currency design or trust system or consensus mechanism you can come up with people will be excited to try out. its a massive open design space right now and people want new ideas. lots of interesting discussions happening via orgs like https://www.radicalxchange.org/ https://www.radicalxchange.org/
  - gorgoiler 5y ago
    The government is the people. If cryptocurrency is an end-run around the collapse-of or lack-of democracy then I get it, but we deserve better in the West.
    - casi18 5y ago
      I think making tools for transparency of financial information with privacy for the individuals is very beneficial to our democracies. and I think tools that help people coordinate/unionise/collectivise around shared interests is good for all of us who are working people. we dont have to be totally cynical and an accelerationist to believe there are flaws with government and money. I dont think the western democracies are collapsing, i feel like i have decent representation where i live. But i think things could be done better, ive also witnessed massive wastes of resources in local government, corruption and collusion. I dont think the systems we've inherited from pre-electricity society are going to be the absolute best we can ever come up with. this is hackernews, where people praise saas startups and hobbies and research on new gpus. but damn you if you think we can come up with better money or government. I think people are just skeptical of the intentions of those of us working in the space (which is sensible) because of the money and the memes and the absurdity of the energy around the crypto space. but i dont understand why people are so doom and gloom about it, 99.9% of the people involved arent living in a bunker waiting for the collapse of society, generally the eth devs ive met are very positive and optimistic and like you say, believe we deserve better.
yawaworht1978 5y ago
None of the Cryptocurrencies are truly decentralized, at best, they are distributed. They all have devs with access to the repos and devs who can deploy changes. Especially Ethereum is firmly in the hands of Buterin and company. Both depend on each other. Without miners, no currency, without code no mining, without very high algo difficulty, no safety.
aazaa 5y ago
Long story short - hype and broken promises. About security. About scalability. About proof of stake. About code is law. About the world computer. About deadlines and timetables. All the way to the very beginning of the project, although the author doesn't go there. Make the thing so damn complicated few can reason about it or see the time bombs hidden behind the marble pillars. That's a recipe for a high priest class. Still, the hoards eat it up. It's a testament to the power of complex, flawed ideas, marketed to the hilt, and the promise of riches if you stick with the leadership. It's really a recipe for a technology religion.
- sanderjd 5y ago
  My prior with respect to the ability for ethereum to deliver "the merge" to switch to proof of stake was recently reevaluated dramatically upward, after the recent London hard fork went through without a hitch. I was following it for awhile and there is (in my view) really no way to look at it except as an example of an extremely well run very large update to an enormous and complex system. The communication was good, the cadence of test rollouts was good, the testing setup with multiple testnets was good, the upgrade itself was a total non-event, which is honestly unbelievable to me, as someone who has worked on upgrading complex (but significantly less so) systems. I still have a lot of questions about ethereum as a project (like: what are blockchains actually good for?), but this software project management stuff is way down the list of concerns for me. I certainly don't understand why people care about arbitrary deadlines and timelines. One advantage of open and permissionlessly developed software like this is not being beholden to a boss breathing down your neck about deadlines and timelines. Just build the software, it will be done when it's done.
deleted 5y ago
[deleted]
whalabi 5y ago
Author declares themselves a "bitcoiner" and writes things like: > PostNote: This article pairs well with my piece on Bitcoiners having integrity. What it boils down to is there is no integrity in Ethereum and nothing but integrity in Bitcoin Which seems a little...
- sanderjd 5y ago
  Ugh.
shesto 5y ago
Article is legit, i just dont understand why most HN people are being hater about crypto, generally. Especially ETH
johnpanny342 5y ago
PLEASE LISTEN TO MY GOOD TESTIMONY NOW I have lost money several times by sending Bitcoins I have lost money by sending Bitcoins to wrong address and I have also fallen victim to fake traders who block me and stop talking to me after I send them Bitcoins as investment. But luckily for me, my friend introduced Mr Jim Uber to me and Mr Jim Uber is a professional Software Manager and Crypto Technician who has worked with Blockchain Company for 5 years now. Mr Jim Uber helped me to recover back my lost bitcoins just by using a software which I paid for and He asked me to recommend more friends. I will recommend anyone looking for how to recover back their lost Bitcoins to contact Mr Jim Uber right now, contact his email now : jimuberservices@gmail.com or whatsapp him now +19784003014 because he is a Professional and He works with BlockChain company. regards

440 points by myth_buster 5y ago

This article actually explains certain aspects of Crypto way better than actual articles that try to explain Crypto. E.g., I've been wondering why a certain Bitcoin podcaster, who is very popular, has never mined a Bitcoin. He/she talks all day about "stacking Sats", but he/she only buys them. Reading this article made me realize that he/she might see him/herself as a member of the ruling class.

dheera 5y ago
> I've been wondering why a certain Bitcoin podcaster, who is very popular, has never mined a Bitcoin The people actually mining Bitcoin don't have time for podcasts. Podcasts, Youtube, media in general are mostly dominated by people who don't actually do other work, because creating content for those platforms is extremely time-consuming.
kristofferR 5y ago
Bitcoin mining isn't something you can do on your own anymore. Unless you're accidentally located at a place with the cheapest electricity you'll have no chance. Not to mention the ASICs, by the time end-users can acquire them they're usually outdated.
sanderjd 5y ago
It's actually the opposite: even that podcaster is probably not wealthy enough to successfully mine a bitcoin. Bitcoin mining requires a big business and not even one that is easy to start wherever you happen to be; you have to have access to cheap electricity.

teruakohatu 5y ago

> working class — a group that does the work the community needs to operate it. It would be more correct to call miners a Merchant Class. They exploit capital to make profit. Like merchants of old, they take risks that regulations (real-world and the "ruling class") won't impede profit. Hardware gets outdated quickly as mining difficulty rises, so a timely exit is not difficult - wait until cards die, or offload them ebay. > As a Bitcoiner I find these actions intolerable and unacceptable Bitcoin has also forked, many times. Bitcoin Gold for example restored the ability to mine with GPUs. The "ruling class" decided that unless you had access to custom hardware, you could not be part of the "working class".

Tenoke 5y ago
>Hardware gets outdated quickly as mining difficulty rises, People can and still do mine Ethereum with the cards they did 5 years ago, and the difficulty is irrelevant to whether your hardware is outdated or not.
- Tepix 5y ago
  If you run your mining rig in the Ukraine with stolen electric power, yes you can do that.
  - Tenoke 5y ago
    According to the nicehash calculator (which is fairly accurate) even with the really expensive electricity (0.34euro/kwh) in Germany you'll net 1.31 euro a day with a 1080 (released May 2016). https://www.nicehash.com/profitability-calculator/nvidia-gtx-1080 https://www.nicehash.com/profitability-calculator/nvidia-gtx...
javert 5y ago
> Bitcoin has also forked, many times. This is a false comparison. The bitcoin blockchain maintains the original monetary policy of bitcoin, which is effectively set in stone. That is not true of Ethereum, and that is the purported problem with Ethereum.

FeepingCreature 5y ago

Is there any network where the inflationary half-life of the currency is something like a week? I've been looking for something like that since I heard that Bitcoin was deflationary. (I was excited about Eth until I learnt its currency had persistent value...)

dash2 5y ago
Are you saying you would like to purchase and use such a currency? Or would you like other people to purchase and use it?
- FeepingCreature 5y ago
  No, I would like to mine it. Imagine: a network where the only gains you get are from spending your money quickly. The anti-hodl. It would be completely worthless as a store of value or investment vehicle. Its only conceivable use would be as a fast and efficient transaction ledger. Which is what I wanted out of blockchain to begin with! I'd be happy to support a network like that, even if my income was rapidly vanishing.
  - dash2 5y ago
    Right... and who will be buying and using this money?
    - FeepingCreature 5y ago
      People who need fast, cheap, safe transactions rather than a value store.
      - dash2 5y ago
        If a VanishingCoin will lose half its value in a week, and I buy and sell it in a second, using it as a fast cheap safe transaction, then my cost will be at least equal to (1/2)^(1 sec/1 week) of the transaction. VanishingCoin will be outcompeted by SteadyCoin, which is just as fast, cheap and safe, and doesn't lose its value.

DenseComet 5y ago

Seems like one of the core arguments of this is that the the core devs have pushed the difficulty bomb multiple times because they've missed their original timelines for switching to PoS without any repercussions. It seems to me that this is actually the correct thing to do. I'd rather the core devs take their time and iron out the issues instead of being incentivized to play fast and loose with a system that manages billions.

fastball 5y ago
The actual core idea seems to be that the core devs can do whatever they want without cooperation from miners, which is... the opposite of true.
- Tenoke 5y ago
  Miners were very opposed to EIP-1559 and in the end when the talks failed they mostly just ignored them. It's kind of true.
  - latchkey 5y ago
    Not true at all. There was never any real consensus among miners on this front. As a very large miner, I was always for 1559 because I understand the underlying mechanics. The miners who I watched were just kind of bandwagon on the theme of "wait, I'll earn less cause you're burning my fees"? Which in reality isn't entirely the case (price and usage have gone up, along with the lack of wallet support).
    - Tenoke 5y ago
      The Community calls didn't reach agreement with miners, and the fact that they kept protesting it is why the Ethereum Foundation decided to move the ETH 2 timeline forward. https://cryptobriefing.com/ethereum-miners-protesting-eip-1559-has-accelerated-upgrade-eth-2-0/ https://cryptobriefing.com/ethereum-miners-protesting-eip-15... >As a very large miner, I was always for 1559 because I understand the underlying mechanics. I don't know what mechanics you think others didn't understand. Your profitability has dropped and the move is basically moving miners' profit to the largest holders (e.g. everyone who pushed for the change). It's not like the fees have dropped since EIP-1559 if that's something you thought the change will bring for some reason.

dash2 5y ago

"Something here seems awfully similar to the system that crypto-currency was meant to fix. It was meant to eliminate rulers. It was meant to make everyone accountable for their actions. It was meant to reward the intelligent, the hard working and the capable, and not reward the incompetent, or the makers-yet-breakers of promises. However, this repeat of the broken old system seems to be playing out again." One response is that the promise was not well thought through. The idea was to replace "rulers" (human beings who make decisions to take care of a system) and "law" (written rules interpreted by humans) with code. But (a) code is written by humans who make mistakes; (b) the world changes, and systems need to update to respond to that; (c) somebody has to be responsible for dealing with a and b. As a result, currencies need central organizers to look after them. And those central organizers need to be motivated, i.e., paid. Old-fashioned currencies have sovereigns to back them, and the sovereigns are paid by the monopoly of taxation and/or the ability to issue money. Inefficient, but it works. From this perspective, bitcoin et al. look like technical solutions to social problems. In particular, bitcoin is designed to have nobody taking care of public goods problems on its behalf. That's a flaw![1] [1] https://wyclif.substack.com/p/thought-bubble-defending-bitcoin https://wyclif.substack.com/p/thought-bubble-defending-bitco...

agumonkey 5y ago
Also, humans or not, in any given system, there will be people in position to analyze and take advantage of subtle / indirect / emergent effect of that system. Be it better brains, more funding to try strategies, it will happen.
- deleted 5y ago
  [deleted]
- hiddencache 5y ago
  Is that a bad thing? Maybe that's how systems become more efficient.
  - agumonkey 5y ago
    Depends on which side you're on. The big smart may again take advantage of the rest.

fastball 5y ago

> Something here seems awfully similar to the system that crypto-currency was meant to fix. It was meant to eliminate rulers. It was meant to make everyone accountable for their actions. It was meant to reward the intelligent, the hard working and the capable, and not reward the incompetent, or the makers-yet-breakers of promises. However, this repeat of the broken old system seems to be playing out again. Was it? Most of these goals were definitely not talked about when Bitcoin was first invented, and to this day I wouldn't say this is the list the vast majority of people in the crypto space would come up with if you asked them what the point of cryptocurrency is.

tpae 5y ago

It takes a lot to build a community. The way that article portrays it ties more into an allegory. Let's not forget that every participant is there voluntarily, and if they are genuinely suffering, they will choose to move on. Ethereum is a powerful connecting force that brings trust within the internet.

void_mint 5y ago
> Ethereum is a powerful connecting force that brings trust within the internet. I've got a bridge to sell you when you're ready
- muzster 5y ago
  Off Topic: In case anyone is not familiar with the phrase : "I've got a bridge to sell you when you're ready" (1) A con artist who sold a bridge. https://en.wikipedia.org/wiki/George_C._Parker https://en.wikipedia.org/wiki/George_C._Parker Not to be confused with :- (2) Rumoured that the wrong 'London' bridge was sold to Arizona (vs Tower Bridge) https://www.history.com/news/how-london-bridge-ended-up-in-arizona https://www.history.com/news/how-london-bridge-ended-up-in-a... It could be argued that both apply - but I'm not getting into that argument !
- spacedude99 5y ago
  Luckily I can afford the bridge having bought Ethereum years ago.
  - elevenoh 5y ago
    ouu not a bad attempt with the dash of humour included, but overall little tasteless here. you'll improve at this ;)
  - void_mint 5y ago
    Luckily I can afford the bridge having bought Baseball Cards years ago

Sevii 5y ago

I emphasize with the arguments here but I differ in my conclusion for two reasons. 1. I don't own just Ethereum, its not a boat that I'm riding in, its one of many gambles I'm making. 2. The Ethereum network has generated a ton of really good stuff (Smart Contracts, DEFI, NFTS, IPFS, ENS, etc) despite whatever governance problems it has. Cryptocurrencies are far from mature. There is no guarantee eth and btc will still be valuable in 10 years. They could be replaced entirely by new chains with different software.

latchkey 5y ago
10 years ago I didn't think bitcoin would be here today. Yet, here we are. If we waited for everything to be mature, then we wouldn't have used web browsers in the early days. I remember when people were afraid to put a credit card into a website. Bitcoin and ETH won't get replaced for the same reasons we ended up with Hacker News, Facebook, Google, Apple, Ebay, Amazon... network effects are amazingly strong. Bitcoiners use the phrase: "The next bitcoin is bitcoin."
- sanderjd 5y ago
  It's hard to know when something is Facebook, Google, Apple, or Amazon vs. when it's MySpace, AOL, Palm, or pets.com!
  - latchkey 5y ago
    If you put it that way, then that explains all of the failures before bitcoin, of which there were many 'digital cash' attempts.
kristofferR 5y ago
IPFS isn't connected to Ethereum as far as I know.
caf 5y ago
Even when gambling, I don't gamble on a crooked table.

phase5 5y ago

Here's some other articles on the problems with Ethereum: https://github.com/libbitcoin/libbitcoin-system/wiki/Proof-of-Stake-Fallacy https://github.com/libbitcoin/libbitcoin-system/wiki/Proof-o... https://hugonguyen.medium.com/proof-of-stake-the-wrong-engineering-mindset-15e641ab65a2 https://hugonguyen.medium.com/proof-of-stake-the-wrong-engin... https://hugonguyen.medium.com/work-is-timeless-stake-is-not-554c4450ce18 https://hugonguyen.medium.com/work-is-timeless-stake-is-not-... https://medium.com/hackernoon/sharding-centralizes-ethereum-by-selling-you-scaling-in-disguised-as-scaling-out-266c136fc55d https://medium.com/hackernoon/sharding-centralizes-ethereum-... https://blog.lamden.io/turing-incompleteness-and-the-sad-state-of-solidity-d5278ba4eda0 https://blog.lamden.io/turing-incompleteness-and-the-sad-sta...

cliftonk 5y ago

That this gets upvoted to #2 speaks poorly of HN. Why on earth are we still talking about the DAO? This is a collection of tired, irrelevant arguments that entirely ignores product-market fit and a large, vibrant community of developers. [edit] ah, of course. a bitcoin maximalist. how dare there be an alternative use-case for crypto that involves people using it. the thing bitcoin has going for it is a large community of peripheral people believing it will be the global reserve currency (it wont).

dcow 5y ago
Uhmm.. what product market fit? And why is proof of steak good?
- darthrupert 5y ago
  I prefer, nay, demand proof of cake!
- BLKNSLVR 5y ago
  Proof-of-steak is quite satisfying to pass. And since I'm committing to this literal shitpost, the proof-of-steak misspelling is entirely appropriate to the amount of salt in the article.
- deleted 5y ago
  [deleted]
- TimJRobinson 5y ago
  $100B+ invested across hundreds of decentralized apps, with exponential user growth, is absolutely product market fit - https://defillama.com/chains https://defillama.com/chains
  - arcturus17 5y ago
    Nothing about that says product-market fit beyond the speculative use case - which I would agree does show spectacular product-market fit since it is proven there are tons of people willing to speculate and crypto provides an asset class with attributes that people are really craving (poor regulation, high risk and volatility, etc.)

dcow 5y ago

I lost interest in Eth when the “code is law” law was broken. I’m glad I did. I don’t believe proof of steak is the correct solution to the energy required for proof of work. To be clear, a lot of good insight has come from Eth, but I’m not ideologically bought in anymore. Recently I have been exploring Chia as a farmer. Rather than the ruling class being a group devs and random early miners, the ruling class is a (soon public) corporation. At least a corporation has a clear legal structure of existence in a capitalist society. I see it as a sort of anchor between a purely cyber community and the actual world we subject ourselves to. I can buy shares in a corporation if I want to participate in the ruling class. The ruling class has legal agency to increase the value of its share price, which is the dual of it’s the underlying asset. Farmers still make less over time but the logistics are clearly laid out in detail, and TX fees kick in to supplement. Maybe it too will all go up in flames, but until it does I’m along for the ride. I believe we can sustain a proof of work system that is orders of magnitude more efficient than constantly running sha. And personally I feel “crypto” has had enough iterations that it’s about time to pick an innovative one and throw some labor behind it.

latchkey 5y ago
As far as I understand it, Chia suffers from the problem of just filling hard disks with useless data. https://www.backblaze.com/blog/chia-analysis-to-farm-or-not-to-farm/ https://www.backblaze.com/blog/chia-analysis-to-farm-or-not-... Filecoin is a more viable and useful option imho.
- dcow 5y ago
  There are way more HDDs lying around needing to be used than GPUs, though. Storage is so much easier to come by. File coin has structural problems like you cant mine filecoin without first buying filecoin to stake…
  - everfree 5y ago
    > File coin has structural problems like you cant mine filecoin without first buying filecoin to stake Why do you consider this a structural problem?

ineptech 5y ago

This is overlong and pretty florid, but its conclusion (that a long record of forked changes, each being good for big ETH holders but bad for miners, is roughly equivalent to the self-dealing of wealthy insiders in the traditional financial world) doesn't seem wrong.

kristofferR 5y ago
The distinction he makes between miners and holders seems totally arbitrary in my view, it's not like the miners aren't also holders. The more you mine the more you hold.
secondaryacct 5y ago
Anyone who thought differently when crypto appeared was most likely young and naive. If a system deal with effort credit, some will find ways, whatever rule you think they follow, to get more credit for less effort. There s no solution, it s the basic of energy limitation: you have an enormous incentive to conserve energy until we can get so much more than we require with so little spending that it becomes irrelevant. But then, we ll find ways, probably, to spend so much energy that we ll reach the limit again. A bit like in the 2000s when you kept doubling your disk drive space every year and still kept filling it at exponential rate :D
chrisco255 5y ago
Why is it wrong? Ethereum has had the plan to move to proof of stake for years, and the purpose of the network is to serve its users not to enrich miners. We pay miners for security. That's great, but if we find a cheaper way to do security, there's nothing wrong with choosing a different security solution.
everfree 5y ago
Miners are contractors. They have no stake in Ethereum's long-term success unless they become ETH holders as well. Ether's price has risen exponentially. It doesn't make sense (and isn't necessary) to pay miners exponentially higher amounts of money to do the same job, thus the issuance reductions.

kristofferR 5y ago

> As a Bitcoiner I find these actions intolerable and unacceptable. I know none of them would ever be accepted in Bitcoin. This sums up the whole piece in my view. Bitcoin development stagnated years ago exactly because nobody involved wanted to change/hard fork it to implement improvements. For people who want a Bitcoin-like Ethereum with no DAO fork or staking there's Ethereum Classic.

tofukid 5y ago
https://github.com/bitcoin/bitcoin/commits/master https://github.com/bitcoin/bitcoin/commits/master I wouldn’t consider that stagnate.
- kristofferR 5y ago
  Sure, it's just moving very slowly after the block size civil war. I remember the early years when the talk was about interesting developments instead of just the value.
  - javert 5y ago
    Bitcoin has chosen consistency with its original principles over "innovation." A good choice, in my book. What we should think of as constituting sound money has not changed since 2008. That is what bitcoin is supposed to be - sound money. Ethereum is supposed to be something else - and it makes sense for Ethereum to "innovate" much more than bitcoin does.
    - Tepix 5y ago
      > That is what bitcoin is supposed to be - sound money. Bitcoin can't be used as money in most cases as transactions are too expensive and slow. It has failed its primary function. Instead of doing something about it, the notion of using bitcoin like money has been abandonded and it's merely a "store of value". That's until people stop valuing it.
      - 5y ago

seibelj 5y ago

The great part about cryptocurrency is that if you don’t want it, don’t buy it - don’t read about it - don’t do anything. It is a purely voluntary system. If you want to avoid US Dollars, it’s essentially impossible for most people. There is no problem with Ethereum.

smt88 5y ago
You're correct in the financial sense, but not socially. I can't entirely opt out of crypto because people around me are making or losing (mostly losing) money it. Mining also pollutes air that I breathe and accelerates climate change. Regardless of whether you think these external effects are worthwhile, they exist and are unavoidable.
lxgr 5y ago
Except if you want to buy a GPU today.
perryizgr8 5y ago
Except miners slurping up the entire limited GPU supply means I haven't been able to afford a proper graphics card for about 3 years now.

hamburgerwah 5y ago

Ethereum is and has always been the toy of Vitalik Buterin and his cronies. They control roughly 64% of all ETH. Everyone else is just share cropping suckers.

BLKNSLVR 5y ago
From what I've read and heard of Vitalik Buterin, he seems most unlikely to have "cronies". The reason Charles Hoskinson left the Ethereum Foundation is that Vitalik wanted it to be non-profit, whilst Charles wanted it to be commercial / for-profit. Most of what I've heard of Vitalik paints him as having a saint-like aura (my own admittedly hyperbolic description). But then maybe we'd all appear that way if we had $billion resources at hand...
- deleted 5y ago
  [deleted]
- javert 5y ago
  Vitalik is a saint in comparison to Hoskinson, but that doesn't mean Ethereum is sound money. It is what it is; lots of good innovation there, but sound money, it is not.
  - whitepaint 5y ago
    None of the cryptos are sound money ("money not liable to sudden appreciation or depreciation in value") except stablecoins on Ethereum. Bitcoin can easily lose 80% of its value in a month and no one would be surprised. Bitcoin is the biggest speculative bubble of all time. It absolutely has no utility (imagine if Bitcoin disappeared now - what would the world lose?). The actual real exciting stuff regarding the cryptos is here: https://ethereum.org/en/dapps/ https://ethereum.org/en/dapps/
    - javert 5y ago
      Bitcoin can be sound money after the price stabilizes, which will probably take decades if it ever happens. Nothing else in the world ever could be sound money except commodity money, like gold, but I'd argue that bitcoin is better.

Havoc 5y ago

Author is looking for perfection in what is essentially a Wild West. I also think it’s asking the wrong questions in a way. Whether Bill Gates should have made billions or not whether he should be in charge and corporate structure is largely irrelevant to Silicon Valley crushing it. Fairness equitability and consistency would be nice but is not compulsory at all

javert 5y ago
Bitcoin itself isn't the Wild West, and that's part of what the author is saying.

Apofis 5y ago

The only value argument of Etherium over Bitcoin is that you can have computation on the blockchain, which is a joke when you consider AWS and Azure exists. The rest are delusional details.

chrisco255 5y ago
Could you explain precisely, how you might build a $350 billion plausibly neutral, open source, non-gated, cryptographically secure blockchain and smart contract platform with 100% uptime over 6 years on AWS and Azure?

swayson 5y ago

Human greed is the problem. How much of promising tech, starts out so innocent till big money becomes aware of it or those who want to make a quick dime, tarnish principled thinking and action.

imtringued 5y ago
Cryptocurrencies are just as bad as the fiat they replace. The problem with fiat is that people use it as a high score to measure their own status/rank. But it is also needed to pay people. But people only work if they get paid. You run into the money shortage problem that caused so much trouble in 2008.

sarah180 5y ago

There are good points here, but I think analogizing the situation into a class struggle within a society is both confusing and specious. Ethereum is not a civilization: it's a piece of FinTech.

miguelmota 5y ago

If something is hard in theory, it's 10x harder in implementation. Complex systems have a lot of 'unknown unknowns' that can't be forecasted. Ethereum is $300B+ live network so every small change takes time to research, test, and implement. Migrating from PoW to PoS is like swapping out the engine of an airplane in mid-air.

jstx1 5y ago
If you ask the cryptocurrency subreddit, the best thing to do with any money you have[1] is to buy ETH at any price and stake it (i.e. lock it in and receive interest until ETH 2.0 is released). I find that absolutely mindblowing given all the complexity you're pointing out + the fact that there is no date and no clear explanation of what happens to the funds in the event of failure. And on top of this the fact that most people are doing the staking through exchanges because they don't have the required 32 ETH to do it themselves, it looks like a giant disaster waiting to happen. And somehow Ethereum is one of the most positively viewed cryptocurrencies out there. I don't get it. [1] This is only a mild exaggeration.
- pshc 5y ago
  ETH2 is going to happen sooner or later… The beacon chain already works in production so it seems inevitable the devs will merge mainnet onto it. Not completely convinced about their 2021/2022 timeframe. All the validator deposits are public data; how would they be destroyed? The funds will have to be unlocked at some point, people will demand it.
  - jstx1 5y ago
    > The funds will have to be unlocked at some point, people will demand it. This seems contrary to everything crypto claims to be about. "Just trust them, surely you'll get the money back"
    - pshc 5y ago
      I believe in them to deliver eventually. Would you be interested to place a long bet?

acjohnson55 5y ago

Did Ethereum ever make a promise that "code is law"? The references I'm finding are all in Ethereum Classic docs. Fair point to the author for finding the dynamic nature of Ethereum's progression not to their liking, but it's a real reach to portray it as some kind of class conflict parable.

animex 5y ago

I think if anything the crypto-experiment has revealed is that an uncaring, cold machine doesn't meet the needs of the human condition. A person fat-fingers his life savings to null, a thief socially engineers someone's money, a bug causes assets to be trapped, etc. It's clear we need a better system that can service our imperfections.

casi18 5y ago
and things like social wallets and trust networks as a response to those issues are emerging as the best way forward, less seed phrases and hardware wallets with tiny buttons. connecting with friends is the best security. turns out ethereum is a social network with a very fast uptake worldwide. it shows us that community and support for one another is the Layer 0 that these things are built on top of. code isnt law, people come first. if we stick with that it could work pretty well.
jkhdigital 5y ago
Unfortunately we live in an uncaring cold machine (the natural universe), which is ignored or hand-waved away at our mortal peril.

ceilingcorner 5y ago

Calling miners “the working class” is a misleading label no doubt chosen to instill sympathy. By that measure, factory owners in the industrial revolution were the working class.

silasdavis 5y ago

There's plenty wrong with Ethereum, but casting miners as 'the working class' is a flawed analogy. The mercantile class would be closer to the mark. Notably, their hashing power is based in real world economic power and they extract an annuity from capital expenditure on mining operations and hardware. I also question whether miners are really providing the labour power, as you might expect the working class to do. They build the roads and keep the lights on but the means of production of value is (or ought to be) the services provided by those writing functionality that makes the network useful, i.e. the smart contract writers. Whether one thinks smart contracts on Ethereum have any value is another question but that was at least the vision. A move to proof-of-stake does not remove the role of miners/validators. Validators will still earn a reward from validating blocks. So it's not as if this 'class' is being disenfranchised totally. Finally the social class analogy entails disjointness of classes, this is certainly not the case for miners, many of whom are major token holders, and some of whom are involved in governance (of course by miners we are taking about the humans controlling the mining rigs not the computers themselves)

denton-scratch 5y ago
> There's plenty wrong with Ethereum, but casting miners as 'the working class' is a flawed analogy. Agreed. Marx's working class consists of those who do not own means of production, and are therefore compelled to sell their labour. Miners do not lack means of production; they operate expensive mining machinery. That machinery continues to run, and earn money for the miner, even while the miner sits on the beach. Selling their labour really isn't a good model for what's going on. Miners are just ordinary capitalists, exploiting a market opportunity.
- Dylan16807 5y ago
  And there's a fixed amount of mining labor to be done, requiring far less than 1% of the current effort spent. So why are the pay cuts a problem? (Especially if you chart payout in USD.)
- dragonelite 5y ago
  The two class cycles workers cycle: Commodity(labor) -> Money -> Commodity(food, housing bills) Capitalists cycle: Money -> Commodity(means of production) -> Money(profit/surplus value) At least that is the bit that kind of sticked to me and made me realized in the west you want to do the second cycle. Earn money by selling labor, live life as a cheap ass for a while use savings to become a asshole landlord.

msaadat 5y ago

> By burning the working class’ money, the ruling class and wealthy class end up with a larger piece of the overall pie. It’s ingenious. Evil, but ingenious. The arguments in the article would have carried more weight without the loaded language. Miners are more like banks in a fiat system rather than 'working class'. Pay cuts for middle-men means increase in efficiency of the system. Very evil indeed.

shp0ngle 5y ago

Who the hell cares. Crypto people were warned repeatedly, since 2017 (and arguably even sooner), that this is all a scam and they should not put their money there. They ignored those messages for years, put the money there anyway (because the number goes up), so, tough luck. Articles "network XY is more decentralized than network YZ" are boring.

jl2718 5y ago
Because at some point the banks will fail and one of these ‘scams’ is going to be necessary for you to get along in life. I’m sorry that this is the case; I really wish that the system we live in was sustainable, but it’s not, and it probably won’t be reformed before it’s too late. Maybe this is a matter of opinion, but it happens to be the most common opinion of people that have studied the matter without incentive to believe one narrative. I have never seen a well-informed defense by an independent writer that did not rely almost exclusively on appeal to authority. There are opportunists. There are scammers. That’s not how this thing got started. We started this to mitigate an unstoppable problem. I personally never liked many economic aspects of the Bitcoin protocol, and dismissed it very early. I know many others that aped into mining a fortune based on much less understanding. I’m now willing to accept that it is the least bad of likely candidate solutions, and the reason for that is that all newer entrants cannot gain relevance without massive investment, which means owners from the old failing system.
- meowface 5y ago
  I'm generally optimistic about cryptocurrencies, but these kind of catastrophe scenarios where cryptocurrencies play the role of savior have always seemed pretty silly to me. If the US dollar collapses or experiences hyperinflation, and/or US banks all collapse, pretty much everything is going to be fucked everywhere, most likely. Especially because whatever's driving that catastrophe is probably disrupting lots of other things, as well. (A major war, for example. The global Bitcoin/Ethereum/etc. networks might become disconnected and fragmented in those scenarios. Let alone infrastructure for fiat exchanges or paying for things with cryptocurrency.) I think these events are very unlikely to begin with, yet a lot of cryptocurrency maximalists speak as though they're likely or inevitable in the mid-term or near-term. But if they do actually happen, I think digital currencies are going to be the least of almost everyone's concerns at those times.

kokizzu3 5y ago

still related: https://www.youtube.com/watch?v=Ykyd4iRi5yc https://www.youtube.com/watch?v=Ykyd4iRi5yc

skinnyasianboi 5y ago
Maybe it was relevant 3 years ago but imo at least 4 of his 6 points are not valid anymore

Ericson2314 5y ago

The idea that anyone who is concerned (at least via analogy) about dealing with inflation by knee-caping wages wants to boost bitcoin is, frankly, hilarious. Ah, baby's first step.

csomar 5y ago

> Excuses are made and explanations are given as to why in this particular case an exception needs to be made to the “Code is Law” promise I really wonder what Ethereum investors think of this. A "precedent" was made. Crypto has yet to come to the real test with governments, courts and the physical laws of humans. With Bitcoin, it can be stipulated that changing the network is impossible or unheard of; but that's not the case for Ethereum. It doesn't help, also, that the network is being "processed" by a few elites (or pools of wealth) that could be, potentially, identified and made to obey the "government/s". This is not the case of Bitcoin where the introduction of KYC for mining will require a hard-fork. Bitcoin (the core chain) has never undertook a hard-fork (which is why a lot of Bitcoin forks are out there).

whitepaint 5y ago
Majority should decide. Majority decided. Majority will decide. I completely agree with this.
nootropicat 5y ago
>This is not the case of Bitcoin where the introduction of KYC for mining will require a hard-fork. That's not true, introducing full kyc for transactions only requires 51% of hashrate. >It doesn't help, also, that the network is being "processed" by a few elites (or pools of wealth) that could be, potentially, identified and made to obey the "government/s". A direct opposite is true. PoW is extremely vulnerable to a government takeover. Even in the worst case, buying majority of hashpower requires few billions at most - which is well within the ability of many countries. More practically, overwhelming majority of mining is done by registered companies in impossible to hide industrial warehouses, making them trivial to regulate and force to do kyc. Total fees are very low on bitcoin now, meaning it's more profitable to mine even empty blocks (due to kyc requirement) in a place with cheap electricity than try to mine with transactions in a place with more expensive electricity. Additionally, America is notorious for trying to enforce its jurisdiction globally, so eg. European miners processing kycless American transaction may find themselves in an American prison. Even if their countries won't extradite them, all it takes is a vacation in a wrong country. Chinese ban on mining has ironically made miners-enforced kyc a much more likely prospect. Other countries are much more likely to cooperate with America and jointly force miners to enforce kyc. Contrary to PoW, PoS can function purely anonymously - invisible home nodes instead of big industrial warehouses. External attack by buying enough stake is impossible - there's simply not enough for sale over any realistic periods of time. Regulation is infeasible because legal escape is in theory possible even if only one tiny place in the world remains without forced kyc - there's no need for GWs of power, just some power and internet. Even in countries where it's illegal, hiding a home node is realistic - using tor, vpns and similar, making enforcement very hard. Hopefully kyc laws on block generation aren't actually enforced as that would significantly impact adoption, however, if they were actually to happen, you are going to see bitcoin miners enforcing kyc while eth2 PoS continues unchanged.

mypastself 5y ago

If nearly half the text is bolded, what’s the purpose of the boldface? I feel like there’s a 51% font attack brewing within the article. Regarding the content, the class allegory itself can go the other way as well: the core developers can be thought of as the workers, the miners are the owners of means of production etc. The one point that’s relevant is the rule-making: the DAO hack hard fork has proven that Ethereum’s boasts of decentralization are dubious at best.

stackzero 5y ago
+1 for 51% font attack
xtracto 5y ago
Looks more like the zebra striping for tables: its there just so that you can differentiate paragraphs

nootropicat 5y ago

Miners are most definitely not the working class and they're not doing any useful work. This sounds harsh because most individual miners aren't hostile in any way - but if miners were a one entity, there would be no exaggeration at all. Collectively, paying miners is like paying the mob to not destroy the system, as they are only group with the power to do so. Without miners at all attacks would be impossible. 51% attacks on ETC show that the threat is real. The working class are users - people using and building on ethereum. Their wealth is continuously drained by the mob, but there is hope - a wall staffed by militia is being slowly erected. It's called proof of stake, and once finished, the mob can finally be told to fuck off. In the meantime the absolute value of protection money paid to the mob has grown several times, making it possible to reduce the protection payments percentage rate without impacting security of the people.

Tepix 5y ago
Miners are not doing any useful work is incorrect, they are securing the system.
- elevenoh 5y ago
  Yeah folks don't seem to realize every monetary system requires 'sacrifice' for its security (whether this is lock-up of capital, work etc.) The market most efficiently determines whether [& which] to sacrifice (e.g. computation or capital lock-up) is worthwhile.
  - mandmandam 5y ago
    The market has not efficiently determined that though. _Objectively_ better alternatives to Bitcoin are around for at least the last five years. No one can realistically argue that it's better to have a system use 6 million times more energy, cost infinitely more, and require waiting 16 minutes for a confirmation compared to less than a second. "The market" is chock-full of inertia, vested interests, propaganda, sunk costs, and technical ignorance. There are literally thousands of cryptocurrencies - and the majority are scams. What has "the market" done to protect people? I say all this to do my part to improve "the market", but my estimation of the market's ability to efficiently determine its arse from a hole in the ground is low. Other examples of "the market's efficiency" include tobacco companies responsible for killing millions making bank for decades by fudding science, energy companies fudding data for decades to burn the planet while making billions, monopolies, duopolies, externalised costs, racketeering, collusion, collateral damage, etc etc etc.

horrified 5y ago

I would imagine most Ethereum miners are pretty well off by now, so the "working class" analogy is really off. Also "the ruling class" can not really force their rules on others. Everybody participating in cryptocoins right now is hopefully aware that it is an experiment with uncertain outcomes. So the "promises were broken" thing doesn't really convince me, either. I don't think the users of Ethereum were promised a finished product. "Code is law" also only applies if people accept the law. In the DAO case, people decided to change the law, or stick to Ethereum classic.

darkFunction 5y ago

> No moral questions are seriously considered about whether changing this rule is a breach of the promise made at the time of the constitution of the community. This is patently untrue. These questions literally split the community. The majority chose a direction and moved on.

amarant 5y ago

A lot of comments here criticise the analogies made in the post. While the criticism might be correct, I feel this is like missing the forest because of the trees.. Etherium, and most crypto-currencies for that matter, were initially made to fix a broken financial system, where banks unjustly control too much wealth, and changes the rules so that they will always control too much wealth. Etherium does not fix this, it merely copies this system, with all its flaws(and some new ones). That is why etherium is pointless. It does not provide value to society, as it utterly fails to solve the problem it identified. There is no other crypto-currency that does solve this problem, but then I guess some of them never tried to in the first place.

ikt 5y ago
> Etherium, and most crypto-currencies for that matter, were initially made to fix a broken financial system No? Buterin argued to the bitcoin core developers that Bitcoin and blockchain technology could benefit from other applications besides money and needed a more robust language for application development that could lead to attaching real-world assets, such as stocks and property, to the blockchain.[15] It's like you're trying to describe Ethereum from what bitcoin fanboys have told you.
- jstx1 5y ago
  I think that you're confusing money and finance. In addition to being money (like Bitcoin), Ethereum is clearly doing a lot in the space of finance - that's the whole point of DeFi (it's also supported by what Vitalik said according to your own comment).
- amarant 5y ago
  But the only kind of application that would even theoretically benefit of running on the Blockchain is a finance application, and it's not better at that than the current system. In fact, it's worse. The whole idea of "code is law" is deeply flawed, and I think the hard forks prove that. The problem then is that smaller financial injustices that do not get the attention of the core Devs, will go unchecked and unfixed forever. The idea of zero trust financial applications is intriguing, but in practice "zero trust" means "trust Vitalik", and to be honest, I trust my current bank more than I trust some random dude in the internet, thank you very much. (Not that I'm a fan of my current bank, they suck, just slightly less than any alternative I'm aware of) I know some people develop other kinds of applications too, but I completely fail to see the point of running (for example) a video game on the Blockchain other than the novelty..

unknownOrigin 5y ago

Oh boy, I see the crypto market is on the rise again so it's time for the HN crypto hot takes to grace our eyes yet again. We get it alright, crypto bad.

stackzero 5y ago

bitcoin maximalism is the worst. wealth will tend to concentrate over time anyway (parteo distribution) and a "ruling class" will emerge on bitcoin. miner's voting with hash power is not the future of cryptocurrency governance. If bitcoin does not evolve to allow this effectively it will be regulated out of common use. It's possible to experiment and build decentralized governance models directly into blockchains see e.g. https://polkadot.network/polkadot-governance/ https://polkadot.network/polkadot-governance/ (disclaimer not a shill I like the tech)

throw2500 5y ago
The problem: the libertarian ideology that inspired Bitcoin explicitly denies that there can be a ruling class because free markets are optimal, distributed, and stay free forever. But a Pareto distribution is kind of the default wherever people interact. So a system needs to be deliberately constructed to counteract it, if that's its goal. And saying "praise the market" won't be enough.

birdyrooster 5y ago

Everything wrong with crypto is the notion you can make a global reserve currency impervious to special interests. It’s going to be gamed by the people at the top, they will use all and any leverage to change the code to favor them more. They will extract the value from the system like they have every other system and the easiest part is that stakeholders like you and me don’t get any vote. You can’t decouple monetary policy from governance, it just isn’t sustainable. Fiat will always be better for the stability of finance and governance bc citizens (stakeholders) perceive or have a tiny lever of control. Crypto gives you no control as a citizen, and you will become discontent with the impotence of your lawmakers to pay for laws having no sway over the system preventing them from spending. Keynes hasn’t been disproven yet and so deflationary currencies are pretty much insanity, the business people will turn every deflationary coin into their own inflationary piggy bank. History proves me right. National governments the world over will gladly ban crypto before raising income taxes. They have backed themselves into this corner with the central banks and they won’t be able to resist its ease.

elevenoh 5y ago
>Everything wrong with crypto is the notion you can make a global reserve currency impervious to special interests This ain't binary. Ain't yes or no. Also.. why do you assume crypto is gunning for 'global reserve currency'? Crypto enables all types of experiments toward reducing the insider-asymmetry nature of central control control (e.g. political whim money printing, political whim monetary policy) >Fiat will always be better for the stability of finance and governance bc they perceive or have a tiny lever of control Political, centrally controlled money shifts economic risk from away from markets/market participants (the most efficient distributed value-computation we have) onto politically-determined populations. example: fiat policy shifted 2008 wall street bankruptcy risk away from markets onto ordinary people who're being inflated-away & exploited by the Cantillion Effect.
- birdyrooster 5y ago
  The only reason Michael Saylor is telling people to mortgage their house and sell their stonks to buy BTC is because he and a bunch of other whales are gunning to make BTC the world reserve currency. You see this mentality everywhere and it is the only way these coins are going to go to the moon. Not to mention a lot of these people are libertarians who see this as their way to “fix” the problems of central banks. Certainly our politics leads to the socialization of corporate risk, but crypto is subject to the same politics only with a much smaller pool of voters. Spending on any community at this global scale will be looked at as pork and the needs of disenfranchised will calcify further. Again, it’s code and it’s not immutable. The mechanisms of distributing crypto clients will betray the interests of the common citizen. There is no leverage for commoners, only special interests. Inflation could be used to redistribute wealth for greater equity and the worlds wealthiest see this threat which I think is the only reason crypto has their attention.

dalbasal 5y ago

The social class metaphor is stretched pretty thin, but it can be interested to follow such threads and see where they lead. I suppose it's endlessly interpretable, but here's my take on bringing it down to earth. - Different "classes" have different interests. (1)Miners. (2) Big, rich coin owners. (3) Rule makers and influencers. Group 2 & 3 overlap and might collaborate to screw miners. - The author is thinks fundamentals/promises like "code is law" and such will gradually crack, because absolute adherence will be broken. - Rule making is corruptible. "sounds just like the corrupt fiat money system we’re trying to escape" Sounds to me like you have arrived at "governance." The hope a lot of people had/have for crypto is that it replaces people, institutions and rules with explicit code. Coins would be governed by code instead of people, which works until it doesn't work. Since this is already framed in a historical materialism sense... Imagine a society where all laws come from God, are engraved in stone and adjudicated with trials by duel, ordeal or some other way of leaving things in His mighty hands. This works until it doesn't. A currency crisis leaves 90% of people in debt slavery, and the army can't find enough recruits. A UFC champion is abusing trial by combat to get away with all crime and rob everyone. Stuff no one could have foreseen. One of the rules isn't perfect. IRL, such societies will go one of two ways: (1) They have systemic instability, where the stone tablets can be broken and new rules adopted. Or, (2) they fudge. They have a complete and perfect constitution, and a supreme court that interprets it liberally like the US. Maybe they pretend to have a constitution even though one has never been written, like the UK. It turns out we can make that guy fight a bear instead of some poor prisoner. There's a theoretical option 3: adhere. Play out the consequences whatever that requires. Maybe god wants everyone in debt slavery, and that ufc champion running around robbing old ladies. Everything crypto seems to drive to the extremes. An obsession with perfect. There is no perfect. Say smart contracts work great for collectible sneakers. Yes, it collapses when a judge rules to give a sneaker collection back to a guy that got robbed. Does that really make it worthless? Is an institution responsible for cancelling and issuing sneaker coin, on court order, really such a blasphemy?

pattusk 5y ago
> "The hope a lot of people had/have for crypto is that it replaces people, instititions and rules with explicit code" My experience in crypto over the past two years has been exactly the opposite. The main issues facing the space today all have to do with governance: how do you get holders of gov tokens to vote rather than hold? how do you involve them in the evolution of your protocol? There are entire protocols being designed to allow "vote selling" to incentivize delegation for small owners. Code is a tool to make sure laws are enforced. But the rules are increasingly being made and amended at the social/political layer. It may not be democratic. it may not be fair. it may not be efficient. but it's a damn interesting experiment to watch evolve.

jaked89 5y ago

Early crypto adopters are freedom minded people. I have no problem with a new economic system where the wealthiest are the most freedom-oriented. If crypto ever replaces the current monetary system, late adopters will have to fight for crumbles. And that's OK; you support deception & violence, so you stay poor. That's cosmic justice.

kevingadd 5y ago
So if I'm understanding you correctly, "late adopters" including people who don't have money for mining hardware/coins or don't even own a computer, just a phone - deserve to be poor because not buying in to crypto is supporting "deception and violence"? What's the logic here?
- iSnow 5y ago
  The logic of Bitcoin maximalists who already revel in dreams that one day, they will relocate to remote islands or citadels while watching the world burn down. Any human with a moral compass would shudder at the thought of a collapse of Western democracy, but not them: they giggle in anticipation of becoming the new ruling class or at least an exclusive society of mega-rich while those who doubted the Bitcoin religion will have to prostitute their daughters to the nouveau riche. "Have fun staying poor" is their battle cry. In their twisted libertarian world view, people forced by hunger to toil day in, day out is not violence, but the state taxing incomes is.
- jaked89 5y ago
  Strawman attack. I didn't mention mining; anyone can purchase crypto. If you prefer to support the fiat thugs by holding into their tokens, be ready to pay the price.

gorgoiler 5y ago

Cryptocurrency is so unfair. Who do these people think they are, trying to push upon us a new gold? If a new value exchange mechanism is to be invented, it really ought to be one that doesn’t slyly concentrate billions of wealth into the hands of a few. There’s plenty ways of doing that already thank you very much.

casi18 5y ago
> Who do these people think they are, trying to push upon us a new gold? it is completely opt in, you don't have to participate. which seems better than the money governments say we have to use (because they are in control of it and can use that power to maintain control of people). > one that doesn’t slyly concentrate billions of wealth into the hands of a few. lots of people in crypto very open to any ideas or suggestions you have to solving the matthew effect, non-coercive tax systems, and public goods funding. genuinely, any community currency design or trust system or consensus mechanism you can come up with people will be excited to try out. its a massive open design space right now and people want new ideas. lots of interesting discussions happening via orgs like https://www.radicalxchange.org/ https://www.radicalxchange.org/
- gorgoiler 5y ago
  The government is the people. If cryptocurrency is an end-run around the collapse-of or lack-of democracy then I get it, but we deserve better in the West.
  - casi18 5y ago
    I think making tools for transparency of financial information with privacy for the individuals is very beneficial to our democracies. and I think tools that help people coordinate/unionise/collectivise around shared interests is good for all of us who are working people. we dont have to be totally cynical and an accelerationist to believe there are flaws with government and money. I dont think the western democracies are collapsing, i feel like i have decent representation where i live. But i think things could be done better, ive also witnessed massive wastes of resources in local government, corruption and collusion. I dont think the systems we've inherited from pre-electricity society are going to be the absolute best we can ever come up with. this is hackernews, where people praise saas startups and hobbies and research on new gpus. but damn you if you think we can come up with better money or government. I think people are just skeptical of the intentions of those of us working in the space (which is sensible) because of the money and the memes and the absurdity of the energy around the crypto space. but i dont understand why people are so doom and gloom about it, 99.9% of the people involved arent living in a bunker waiting for the collapse of society, generally the eth devs ive met are very positive and optimistic and like you say, believe we deserve better.

yawaworht1978 5y ago

None of the Cryptocurrencies are truly decentralized, at best, they are distributed. They all have devs with access to the repos and devs who can deploy changes. Especially Ethereum is firmly in the hands of Buterin and company. Both depend on each other. Without miners, no currency, without code no mining, without very high algo difficulty, no safety.

aazaa 5y ago

Long story short - hype and broken promises. About security. About scalability. About proof of stake. About code is law. About the world computer. About deadlines and timetables. All the way to the very beginning of the project, although the author doesn't go there. Make the thing so damn complicated few can reason about it or see the time bombs hidden behind the marble pillars. That's a recipe for a high priest class. Still, the hoards eat it up. It's a testament to the power of complex, flawed ideas, marketed to the hilt, and the promise of riches if you stick with the leadership. It's really a recipe for a technology religion.

sanderjd 5y ago
My prior with respect to the ability for ethereum to deliver "the merge" to switch to proof of stake was recently reevaluated dramatically upward, after the recent London hard fork went through without a hitch. I was following it for awhile and there is (in my view) really no way to look at it except as an example of an extremely well run very large update to an enormous and complex system. The communication was good, the cadence of test rollouts was good, the testing setup with multiple testnets was good, the upgrade itself was a total non-event, which is honestly unbelievable to me, as someone who has worked on upgrading complex (but significantly less so) systems. I still have a lot of questions about ethereum as a project (like: what are blockchains actually good for?), but this software project management stuff is way down the list of concerns for me. I certainly don't understand why people care about arbitrary deadlines and timelines. One advantage of open and permissionlessly developed software like this is not being beholden to a boss breathing down your neck about deadlines and timelines. Just build the software, it will be done when it's done.

deleted 5y ago

[deleted]

whalabi 5y ago

Author declares themselves a "bitcoiner" and writes things like: > PostNote: This article pairs well with my piece on Bitcoiners having integrity. What it boils down to is there is no integrity in Ethereum and nothing but integrity in Bitcoin Which seems a little...

sanderjd 5y ago
Ugh.

shesto 5y ago

Article is legit, i just dont understand why most HN people are being hater about crypto, generally. Especially ETH

johnpanny342 5y ago

PLEASE LISTEN TO MY GOOD TESTIMONY NOW I have lost money several times by sending Bitcoins I have lost money by sending Bitcoins to wrong address and I have also fallen victim to fake traders who block me and stop talking to me after I send them Bitcoins as investment. But luckily for me, my friend introduced Mr Jim Uber to me and Mr Jim Uber is a professional Software Manager and Crypto Technician who has worked with Blockchain Company for 5 years now. Mr Jim Uber helped me to recover back my lost bitcoins just by using a software which I paid for and He asked me to recommend more friends. I will recommend anyone looking for how to recover back their lost Bitcoins to contact Mr Jim Uber right now, contact his email now : jimuberservices@gmail.com or whatsapp him now +19784003014 because he is a Professional and He works with BlockChain company. regards