I have been skeptical for a long time that the transition to proof of stake would actually happen. It just seemed like the project was delayed and delayed, and there are so many fundamental development problems with this sort of decentralized migration. Nothing quite like this has ever worked before.
But here we are and there is no obvious problem in sight. I'll keep my fingers crossed, and if it goes off without a hitch, I'll have to admit I was too pessimistic and revise my opinion of the Ethereum ecosystem upwards.
Ethereum post-merge looks a hell of a lot like a security. We'll see what regulators do, but it's concerning that the Ethereum Foundation has been so quiet about regulatory hazard.
Also alarming is the question marks as to when you'll be able to withdraw staked Ethereum, given the security risks from attacks intended to cause slashing and the dependence on total stake for what the staking rewards are.
I don’t even understand what I’m looking at on fake money websites anymore. A bunch of graphs that don’t correspond to anything at all? The title doesn’t even appear on the page. There’s no text content indicating what this is about. Y’all have fun with your gambling, I guess.
My intuition is that PoS isn't economically stable model. In PoW, the miners had interest in stability of prices because their costs were anchored in reality by the mining rig. So once you had expended the real life cost of a mining rig, your interests were to only increase the price of the coin. Whales might have wanted to manipulate prices but they ran the risk of bankrupting miners (many of them were miners).
Now the incentives are perverse. Since prices aren't anchored by real world expenses, the incentives of whale stakers is extreme price volatility, so that they can increase the share of the network they hold. They are free to pump and dump as they please even more than before because there's nothing anchoring them to reality. They get to set the price alone.
Well, they can only move the price by whatever percentage they hold in ETH. I would assume, maybe naively but not unreasonably, that a holder with no plans to sell would see staking as a mostly risk free way of generating return. So I'd assume that these big guys would be putting most, if not all, of their capital into staking. Therefore I wouldn't expect their ability to move the market to be significantly higher than total staked ETH as a percentage of total supply.
Again, naively, people panic and a smaller but substantial move could cascade, but a news article could do that as well. Stakers don't have a monopoly on the ability to cause a stampede.
Last I read on the mechanics of all of this, the emission rate, burn rate, fee burn and staking requirement were designed in such a way as to keep a certain amount of total ether staked. I don't recall what that percentage was, I think around 10% and it's not exact, this is game theoretical after all and incentives are what drives this so it will fluctuate a bit.
There are problems with not having an ongoing cost to validation, and not having assets external to the system at risk, a big one is the so called "nothing at stake" problem which ethereum claims to have solved (and have a compelling case as to why if you read about it) but I don't believe this problem you speak of is one of them. I am somewhat concerned that these metrics to maintain a certain percentage at stake will not shake out the way they planned and have to be adjusted with a hard fork, this happens in ethereum all the time with incentive structures.
If somebody is as ignorant as me as to what is this about, it’s about ETH cryptocurrency changing to Proof of Stake, take it from what seems to be the original source:
https://ethereum.org/en/upgrades/merge/
"ultrasound" money is not money where the issuance and protocol rules can/do change at the direction of a core group of developers like they do in Ethereum
What cryptocurrency cannot adjust its protocol based on what the core developers want? You want a cryptocurrency that can launch once and never change after that, even as critical bugs are found? I don't think any cryptocurrency like that exists nor do people want it.
I'm not a fan of cryptocurrency, but it is good to see one of the major ones move away from endlessly thrashing hardware and consuming huge amounts of energy.
So congrats, that's one major negative externality tackled, assuming that this all works out.
An open source project pulling off one of the biggest upgrades in the history of software development thanks to efforts of a distributed group of people should be celebrated here. Else, what is the point in calling ourselves "Hacker" News?
What makes this one of the biggest upgrades in the history of software?
How many Ethereum nodes are there compared to, say, iOS or Android or Windows deployments? What’s their hardware diversity? What’s the complexity of Ethereum compared to the aforementioned operating systems?
"upgrade" is a misnomer. It's a "fork"
There will be 2 competing versions of Ethereum after this. Actually there will be 3 because there's already ethereum classic from the last time Ethereum hard forked.
It's just another cryptocurrency fork. It's not particularly more work or harder impact than your average Debian point release, with the most obvious difference being that there are fewer users affected.
The biggest gap between people involved with the Ethereum ecosystem vs. mainstream media seems to be that the former are focused on the economic impact of The Merge, while the latter is focused on the environmental impact. Don't get me wrong, reducing energy costs is great and everyone agrees with that, but the resulting changes in monetary policy are probably even more impactful. But of course this is not sensationalist or simple enough for the media to focus on.
The charts on this website are great, but people outside of the ecosystem likely won't understand them, which is a real problem if Ethereum wants adoption.
What nobody pays attention to is that the entire thing is a cartel and only incentivizes restricting freedom over time and automating turmoil.
It’s a complete disgrace to what cyberspace represents. It’s an opportunistic, exploitative, incompatible, deprecated, deficient paradigm stuck in a physically-constrained view of the future perpetually hindering progress due to preventing the mind in being able to contemplate non-physical things as infinite.
Pathetic, sad, crappy, leaky.
All driven by greed and ignorance.
People are being played to act as pawns for the same “elite controllers” that they complain about; being led to perpetuate playing the same game. The only thing worse than actual scarcity is completely artificial scarcity and erecting simulacra around that notion as if it were real. Way to go building an actual matrix of ignorance and slavery.
Everyone has a mutual interest in not destroying the world we live on. A fraction of a percent of the population cares about Etherum's impact on the way they already conduct business.
This is good. It took way too long to get here, but it's good that Ethereum is finally fixing its "waste energy to create coupons" system. I still don't really see the point of most ethereum applications but at least it's trying to burn the planet much slower now.
All eyes should now be on Bitcoin to also switch to a non-planet-burning proofing system. Ethereum proved that it can happen and all other blockchains should be held to a similar standard.
Labeling Bitcoin mining as "wasteful" is a subjective opinion not an objective truth. Mining does produce something: physics backed security guarantees, which has a value that's determined by a free market (see Bitcoin price/market cap).
This deserves to be the top spot on HN right now. Years of countless replies and mockery here across N accounts telling me this day would _never_ happen. Yet here we are, we're finally about to break away from the shackles of PoW and the crypto skeptics are silent.
EDIT: I'm rate limited/soft banned so I can't reply to most of you/anyone until tomorrow. While I can still edit:
-Cash is the ultimate scammer currency, it would take a ages for crypto to match or replace cash as the best "scam" currency"
-Privacy =/= laundering. Privately transacting is not implicitly a crime.
-Crypto has value as trustless value transfer outside the nation-state system, especially in these uncertain times
-Smart contracts are criminally undervalued. Programmable money is the future.
My stance has been “I’ll believe it when I see it” after years of the merge being “months” away. I’m a skeptic but happy to see a major cryptocurrency switching off the planet burner.
> we're finally about to break away from the shackles of PoW and the crypto skeptics are silent.
One very popular cryptocurrency is making the switch. That still leaves Bitcoin, with double the trading volume, and most of the other popular cryptocurrencies.
More importantly it doesn't change the fundamental problem with crypto: it's deliberately difficult to regulate, which means that it's still a scammer's paradise.
And Ethereum's price can still fluctuate wildly on any given day, making it unsuitable for most real-world transactions.
there’s been much discussion here about how PoS does little to provide a decentralized monetary system since it appears to be built with the idea those with the most money should determine what the “truth” is
Strongly disagree that PoW is a form of "shackles"
PoW = bad is an Ethereum marketing narrative.
The Bitcoin community has many robust counterarguments to this narrative.
Yes. The environmental argument of Ethereum 'burning up the planet' is now about to be addressed and that will silence the endless criticism made by the extreme crypto skeptics about Ethereum incinerating the planet.
They will now just congratulate the re-centralization of Ethereum running on Proof-of-Stake.
The crypto-skeptics will never be silent, but I can assure you that crypto is still here to stay, with some crypto projects surviving and some of them will not survive.
Pretty sad to see so many people hate on proof-of-work. I can only assume it's because they have read shallow articles that tell them "Bitcoin uses X amount of energy therefore it must be bad, because using energy is bad" or something along those lines. It's not so simple.
Proof of work solves issues like:
- What to do with electricity before the generating source is connected to the grid
- Reduces carbon emissions by incentivising the burning of methane gas (20x worse than CO2)
- Makes it more viable to research new energy sources by lowering the cost.
- Acts as a load-balancer for the grid and makes it way more stable. This in turn means that we can build out huge amounts of solar and wind that rely on the weather.
Of course there are situations where Bitcoin is mined using non-renewable sources but if you believe that Solar and Wind are so cheap, then that issue will sort itself out, no? And it won't take long.
If you're an environmentalist and you want to solve the global issue of CO2 emissions, Bitcoin (and PoW) is a very very valuable tool. Don't throw it away because of a faulty belief.
lacker|3 years ago
But here we are and there is no obvious problem in sight. I'll keep my fingers crossed, and if it goes off without a hitch, I'll have to admit I was too pessimistic and revise my opinion of the Ethereum ecosystem upwards.
CastFX|3 years ago
paul_funyun|3 years ago
Also alarming is the question marks as to when you'll be able to withdraw staked Ethereum, given the security risks from attacks intended to cause slashing and the dependence on total stake for what the staking rewards are.
dmak|3 years ago
eyelidlessness|3 years ago
machina_ex_deus|3 years ago
Now the incentives are perverse. Since prices aren't anchored by real world expenses, the incentives of whale stakers is extreme price volatility, so that they can increase the share of the network they hold. They are free to pump and dump as they please even more than before because there's nothing anchoring them to reality. They get to set the price alone.
betwixthewires|3 years ago
Again, naively, people panic and a smaller but substantial move could cascade, but a news article could do that as well. Stakers don't have a monopoly on the ability to cause a stampede.
Last I read on the mechanics of all of this, the emission rate, burn rate, fee burn and staking requirement were designed in such a way as to keep a certain amount of total ether staked. I don't recall what that percentage was, I think around 10% and it's not exact, this is game theoretical after all and incentives are what drives this so it will fluctuate a bit.
There are problems with not having an ongoing cost to validation, and not having assets external to the system at risk, a big one is the so called "nothing at stake" problem which ethereum claims to have solved (and have a compelling case as to why if you read about it) but I don't believe this problem you speak of is one of them. I am somewhat concerned that these metrics to maintain a certain percentage at stake will not shake out the way they planned and have to be adjusted with a hard fork, this happens in ethereum all the time with incentive structures.
sdfhbdf|3 years ago
thrdbndndn|3 years ago
> Ultra sound money is an Ethereum meme focusing on the likely decrease of the ETH supply.
> If capped-supply gold is sound, decreasing-supply ether is ultra sound.
I have no idea what this last sentence means.
cflynnus|3 years ago
capableweb|3 years ago
unknown|3 years ago
[deleted]
Nursie|3 years ago
So congrats, that's one major negative externality tackled, assuming that this all works out.
RestlessMind|3 years ago
pavlov|3 years ago
How many Ethereum nodes are there compared to, say, iOS or Android or Windows deployments? What’s their hardware diversity? What’s the complexity of Ethereum compared to the aforementioned operating systems?
cflynnus|3 years ago
stonogo|3 years ago
cuteboy19|3 years ago
If they mess up they can just roll back the immutable blockchain again, same way they did it last time
PufPufPuf|3 years ago
throw827474737|3 years ago
Also PoS fans watch out and lets talk again in the future, I believe you are loosing some of your desired properties and may be surprised long-term..
zionic|3 years ago
mudrockbestgirl|3 years ago
The charts on this website are great, but people outside of the ecosystem likely won't understand them, which is a real problem if Ethereum wants adoption.
pyinstallwoes|3 years ago
What nobody pays attention to is that the entire thing is a cartel and only incentivizes restricting freedom over time and automating turmoil.
It’s a complete disgrace to what cyberspace represents. It’s an opportunistic, exploitative, incompatible, deprecated, deficient paradigm stuck in a physically-constrained view of the future perpetually hindering progress due to preventing the mind in being able to contemplate non-physical things as infinite.
Pathetic, sad, crappy, leaky.
All driven by greed and ignorance.
People are being played to act as pawns for the same “elite controllers” that they complain about; being led to perpetuate playing the same game. The only thing worse than actual scarcity is completely artificial scarcity and erecting simulacra around that notion as if it were real. Way to go building an actual matrix of ignorance and slavery.
smoldesu|3 years ago
unknown|3 years ago
[deleted]
technion|3 years ago
jeroenhd|3 years ago
All eyes should now be on Bitcoin to also switch to a non-planet-burning proofing system. Ethereum proved that it can happen and all other blockchains should be held to a similar standard.
cflynnus|3 years ago
mamoriamohit|3 years ago
schizo89|3 years ago
unknown|3 years ago
[deleted]
michaelsbradley|3 years ago
[deleted]
zionic|3 years ago
EDIT: I'm rate limited/soft banned so I can't reply to most of you/anyone until tomorrow. While I can still edit:
-Cash is the ultimate scammer currency, it would take a ages for crypto to match or replace cash as the best "scam" currency"
-Privacy =/= laundering. Privately transacting is not implicitly a crime.
-Crypto has value as trustless value transfer outside the nation-state system, especially in these uncertain times
-Smart contracts are criminally undervalued. Programmable money is the future.
robin_reala|3 years ago
jitl|3 years ago
muglug|3 years ago
One very popular cryptocurrency is making the switch. That still leaves Bitcoin, with double the trading volume, and most of the other popular cryptocurrencies.
More importantly it doesn't change the fundamental problem with crypto: it's deliberately difficult to regulate, which means that it's still a scammer's paradise.
And Ethereum's price can still fluctuate wildly on any given day, making it unsuitable for most real-world transactions.
fermentation|3 years ago
cflynnus|3 years ago
rvz|3 years ago
They will now just congratulate the re-centralization of Ethereum running on Proof-of-Stake.
The crypto-skeptics will never be silent, but I can assure you that crypto is still here to stay, with some crypto projects surviving and some of them will not survive.
pbreit|3 years ago
k__|3 years ago
They will never be silent.
The goalposts will move endlessly.
kevinak|3 years ago
Proof of work solves issues like: - What to do with electricity before the generating source is connected to the grid
- Reduces carbon emissions by incentivising the burning of methane gas (20x worse than CO2)
- Makes it more viable to research new energy sources by lowering the cost.
- Acts as a load-balancer for the grid and makes it way more stable. This in turn means that we can build out huge amounts of solar and wind that rely on the weather.
Of course there are situations where Bitcoin is mined using non-renewable sources but if you believe that Solar and Wind are so cheap, then that issue will sort itself out, no? And it won't take long.
If you're an environmentalist and you want to solve the global issue of CO2 emissions, Bitcoin (and PoW) is a very very valuable tool. Don't throw it away because of a faulty belief.