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Delaying the Inevitable: Muir Glacier and the Ethereum Difficulty Bomb

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Re: Delaying the Inevitable: Muir Glacier and the Ethereum Difficulty Bomb

#51

Post by derefr »

arcticbull wrote: post #19
flarex wrote: post #18

Earlier quoted context omitted.

Decentralised Finance (Defi) apps are starting to gain traction on Ethereum. Theres about half a billion in funds currently making use of them. https://defipulse.com

Even those are mostly exchanges (speculation), derivatives (extra speculation) and stable coins (to enable speculation on exchanges which want to avoid AML and KYC in the facilitation of money laundering).

Sure, but they're not speculating on the value of crypto (which is what people are actually concerned about when they talk about speculation.) These apps are just generic infrastructure, like a stock market is generic infrastructure. And, as such, they have value as infrastructure, independent of any of the assets people might list on them; just as a stock exchange has value independent of the ridiculous penny stocks people might list on it.

Re: Delaying the Inevitable: Muir Glacier and the Ethereum Difficulty Bomb

#52

Post by derefr »

> Why? Because Ethereum isn’t just a store-of-value. The Ethereum network also contains smart contracts that execute native code on the blockchain.

It's funny when things are presented this way. Ethereum was never intended to be a store of value. It's a distributed computer that needs its own token economy in order to charge "hosting costs" to the computational agents running on it, and to allow those agents to trade work done for other agents for transfer of "hosting costs."

Ethereum would still be doing what it's designed to do, even if the price of ETH tanked. (In fact, dapp developers would probably prefer ETH to tank, since that'd mean transactions would be cheaper and less crowded by speculative traders and selfish miners.)

Re: Delaying the Inevitable: Muir Glacier and the Ethereum Difficulty Bomb

#53

Post by imtringued »

sp332 wrote: post #9
dcolkitt wrote: post #5

Earlier quoted context omitted.

I can't comment specifically on the details, but one consideration is that Ethereum's mining hash is designed to be ASIC resistant. Bitcoin is entirely mined by dedicated hardware that's incapable of doing anything other than mining Bitcoin. Ethereum is mostly mined by GPUs that can obviously be repurposed for other applications if need be. If the electricity cost for Ethereum mining gets too out of control, the mine…

But the ASICs are used because they are more efficient. Forcing miners to use less efficient hardware is going to drive up the average energy per hash calculated.

You're completely ignoring the difficulty mechanism in Bitcoin. When everyone has a 1TH/s miner that consumes 1kWh and suddenly a 10TH/s miner that consumes 1kWh comes out everyone is going to switch to the new miner. Because Bitcoin guarantees that a block is mined every 10 minutes it has to make the calculation 10x harder than before. The end result? The energy consumption didn't change.

What makes Bitcoin more energy intensive then? The price of Bitcoin. When the price of Bitcoin doubles that also means the mining profit doubles. More miners (= more energy consumption) join the blockchain until the profit margin is back to the previous level. The price of a Bitcoin is 70x higher than the price of Ethereum so that suggests that Bitcoin should use 70x more energy.

Re: Delaying the Inevitable: Muir Glacier and the Ethereum Difficulty Bomb

#54

Post by shakezula »

scribu wrote: post #27

As an outsider to the blockchain world, I would be more interested to know why proof-of-stake is not used by Ethereum yet. Found one article on the subject: https://medium.com/ibbc-io/the-beautiful-complexity-of-pos-3...

Proof of Stake has a separate set of problems to worry about than Proof of Work. It's a solution to some of the scaling problems, but at the expense of some security.

As with all engineering, it's a set of tradeoffs.

Re: Delaying the Inevitable: Muir Glacier and the Ethereum Difficulty Bomb

#55

Post by Semaphor »

leppr wrote: post #46
Semaphor wrote: post #37

Earlier quoted context omitted.

What are the problems with current PoS systems? Not being glib, seriously interested as there are at least a few that implement some kind of Pos (for example dPoS with Ark)

Permissioned networks are a very much easier setting to design a consensus protocol for than public ones. Describing a consensus algorithm as "Proof of Stake" simply means it uses some kind of stake to secure its decisions, this doesn't say anything about the assumptions it starts from. Existing "PoS" blockchains don't have the same decentralization goals as Ethereum.

How is Ark less decentralized?

Re: Delaying the Inevitable: Muir Glacier and the Ethereum Difficulty Bomb

#56

Post by bouncycastle »

arcticbull wrote: post #15

> A vibrant ecosystem of banking functions, asset management, trading exchanges, and more have sprung from this, requiring Ethereum to quickly respond to external events and triggers. That's a bit of a stretch isn't it? Other than speculation and money laundering, I don't think any dapps have gained any traction at all, let alone a vibrant ecosystem.

"Money laundering" is a dysphemism. The proper therm for it is "electronic privacy", or even just privacy.

Re: Delaying the Inevitable: Muir Glacier and the Ethereum Difficulty Bomb

#57

Post by tptacek »

bouncycastle wrote: post #56
arcticbull wrote: post #15

> A vibrant ecosystem of banking functions, asset management, trading exchanges, and more have sprung from this, requiring Ethereum to quickly respond to external events and triggers. That's a bit of a stretch isn't it? Other than speculation and money laundering, I don't think any dapps have gained any traction at all, let alone a vibrant ecosystem.

"Money laundering" is a dysphemism. The proper therm for it is "electronic privacy", or even just privacy.

Unless you're an ancap, this argument doesn't actually say anything; you can protect the proceeds of any crime from investigation and impoundment under the aegis of "electronic privacy". When people say "money laundering is a feature of dapps", it's pretty clear that they're referring to organized crime.

If you are an ancap, more power to you, but it's useful to have arguments that are persuasive to the huge majority of people who are not.

Re: Delaying the Inevitable: Muir Glacier and the Ethereum Difficulty Bomb

#58

Post by mirekrusin »

woah wrote: post #22
arcticbull wrote: post #19

Earlier quoted context omitted.

Even those are mostly exchanges (speculation), derivatives (extra speculation) and stable coins (to enable speculation on exchanges which want to avoid AML and KYC in the facilitation of money laundering).

We use the stablecoin Dai for althea.net. There are several networks running providing internet to people with wireless mesh nodes that pay each other with Dai.

Sounds like pied piper.

Re: Delaying the Inevitable: Muir Glacier and the Ethereum Difficulty Bomb

#59

Post by bouncycastle »

tptacek wrote: post #57
bouncycastle wrote: post #56

Earlier quoted context omitted.

"Money laundering" is a dysphemism. The proper therm for it is "electronic privacy", or even just privacy.

Unless you're an ancap, this argument doesn't actually say anything; you can protect the proceeds of any crime from investigation and impoundment under the aegis of "electronic privacy". When people say "money laundering is a feature of dapps", it's pretty clear that they're referring to organized crime. If you are an ancap, more power to you, but it's useful to have arguments that are persuasive to the huge majority…

"Money laundering" is also when you conceal the source of funds that haven't been tainted by crime

Everyone should have the right to privacy, electronic transactions are no different.

Of course, you can use the good old "if you have nothing to hide then you have nothing to fear" argument, which has already won over...

Re: Delaying the Inevitable: Muir Glacier and the Ethereum Difficulty Bomb

#60

Post by unilynx »

imtringued wrote: post #53
sp332 wrote: post #9

Earlier quoted context omitted.

But the ASICs are used because they are more efficient. Forcing miners to use less efficient hardware is going to drive up the average energy per hash calculated.

You're completely ignoring the difficulty mechanism in Bitcoin. When everyone has a 1TH/s miner that consumes 1kWh and suddenly a 10TH/s miner that consumes 1kWh comes out everyone is going to switch to the new miner. Because Bitcoin guarantees that a block is mined every 10 minutes it has to make the calculation 10x harder than before. The end result? The energy consumption didn't change. What makes Bitcoin more ene…

I don't think you can directly compare the prices of the coins, but you need to look at the reward that's at stake.

12.5 bitcoins every 10 minutes at 7277 USD/bitcoin = 9096 USD/minute

3 eth every 14 seconds at 132 USD/eth = 1697 USD/minute

then you'd expect the bitcoin miners to use 5.3x the energy of eth

EDIT: oh, someone already did the same calculations earlier a couple of comments below :)

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