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Ethereum 2.0 launches

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Re: Ethereum 2.0 launches

#551

Post by clemens2000 »

brian_cloutier wrote: post #492
isthatsoup wrote: post #482

Earlier quoted context omitted.

We can just use renewable energy sources long term. Really don't understand the obsession some people have with the energy requirements of bitcoin mining - please compare these with the energy requirements of the financial systems it replaces. Bitcoin solves the need for third parties in the financial system. That's it, it's not meant to be some eco currency - never was. Where's the validation that the current financ…

Why is POS a joke?

The SEC has come out to say that BTC and ETH 1.0 are most likely not violating US securities laws. By moving to proof of stake ETH has lost that stamp of approval. In addition some people argue that POS is violating security laws. Large institutions are far less likely to adopt a cryptocurrency that might run into legal trouble down the line.

https://www.invigorlaw.com/sec-says-cryptocurrencies-bitcoin... https://medium.com/blockchain-at-berkeley/does-proof-of-stak...

Re: Ethereum 2.0 launches

#552

Post by ishishkin »

woah wrote: post #541
ishishkin wrote: post #536

Earlier quoted context omitted.

What has happened in 2014? Is that a time when brain-washing campaign in crypto-media has been started? "Slashing" is not a solution to this problem.

Vitalik Buterin came up with a solution for the nothing-at-stake problem: https://blog.ethereum.org/2014/01/15/slasher-a-punitive-proo... Also, I'm not sure why you and the other commenter are so argumentative about this. There are several PoS networks out there such as Cosmos, Tezos, etc, holding more than a billion dollars. If there was an issue, someone would have hacked them by now.

> Vitalik Buterin came up with a solution for the nothing-at-stake problem

Is that a link to an article from a peer reviewed academic journal?

> There are several PoS networks out there such as Cosmos, Tezos, etc, holding more than a billion dollars. If there was an issue, someone would have hacked them by now.

I'll give you a hint: "slashing" is not a thing that sustains security of these networks.

Re: Ethereum 2.0 launches

#553

Post by nootropicat »

beaner wrote: post #517
DennisP wrote: post #514

Earlier quoted context omitted.

So what happens after Ethereum finishes migrating to proof of stake and has lower inflation than Bitcoin?

The problem is not what the inflation rate is at any given moment, but that it can be changed so easily, like the very switch to ETH 2 is an example of. The inflation curve in Bitcoin is considered sacred. In Ethereum, it's developer whim and EIP approval.

It was known from the start that the PoW phase is just a temporary development phase, with no parameters set in stone. Eth2 has a deterministic inflation schedule that depends on total amount of stake.

  def calc_annual_reward(total_staked_eth):
     return math.exp(31556926 / 384 * 64 / 31622 / total_staked_eth ** 0.5) - 1
This is the return rate for validators - this should be multiplied by the average online percentage, eg. 0.9 if average participation is 90%. On top of that comes fee burning, which is inherently variable, but likely to lead to deflation at least initially. Extrapolating fees from the last 24 hours and assuming 10M eth is staked, the net result is a deflation of 1.3%.

Re: Ethereum 2.0 launches

#554

Post by nojster »

lekevicius wrote: post #39

I am incredibly happy about this. It's the first step for a major cryptocurrency towards ledger security that does not damage the environment via mining. I always hated how wasteful and energy-inefficient mining is. Staking reduces energy costs by many, many orders of magnitude. With lightweight clients in development, it is possible to validate chain using Raspberry Pi. I hope (but don't expect) that some time in th…

> It's the first step for a major cryptocurrency towards ledger security that does not damage the environment via mining.

Not true. Cardano has been operational with PoS since early 2020. And it’s staking process is much more straightforward and user friendly.

Re: Ethereum 2.0 launches

#555

Post by socialentity »

downandout wrote: post #454
beaner wrote: post #443

Earlier quoted context omitted.

The false premise you're using is that smart contracts provide more utility than sound economic policy does.

I don’t think that “sound economic policy” would, for example, have major banks offering flash loans. There are many things that can only be achieved through decentralization. Policymakers and banks alike have a serious interest in remaining gatekeepers, and would never enable many of the DeFi functions.

On the other hand, if flash loans are not sound economic policy, doesn't that imply they won't prevail? Evolution will weed them out.

Re: Ethereum 2.0 launches

#556

Post by socialentity »

downandout wrote: post #501
kgin wrote: post #499

Earlier quoted context omitted.

So the loan and the return is a single "transaction" (in db terms)? What sort of situation could this be used in? I'm having a hard time truly imagining use without any risk of transaction rollback.

They are primarily used for arbitrage transactions. Token swaps on decentralized exchanges are instant - there is no order book. So you can compose a single transaction that involves many exchanges, swaps involving different tokens, flash loans, etc. If the transaction ends with a profit after the loan is paid back, at the market prices that exist at the time the transaction is executed, the flash loan occurs, and pr…

How would that work, though? It sounds like guaranteed arbitrage? But does arbitrage work as a trading strategy? I thought markets quickly become too efficient for that?

Re: Ethereum 2.0 launches

#557

Post by jerry1979 »

downandout wrote: post #361
nootropicat wrote: post #253

Earlier quoted context omitted.

Define 'kill'. ETC has been 51% attacked multiple times and it still exists. It's very possible some people are going to mine btc on their personal hardware even in 2100. The only caveat is the difficulty adjustment algorithm, as it's potentially possible for btc to become stuck at an extremely high difficulty. For 'kill' as in 'stops being big and important' I think it's going to happen relatively soon, mostly agree…

Bitcoin might fall into obsolescence, but it won’t be because it is mined. It simply isn’t as useful as ETH. I firmly believe that DeFi, which is based upon ETH’s smart contracts and distributed EVM concept, is the future of the finance and investing universe, even with its many issues today. Flash loans/minting, for example, have turned the markets into the ultimate meritocracy. Anyone - rich or poor - can access up…

Have you checked out rsk? It lives on top of bitcoin and apparently does smart contracts.

https://www.rsk.co

Re: Ethereum 2.0 launches

#558

Post by tsujp »

nyhc99 wrote: post #505
tsujp wrote: post #33

Earlier quoted context omitted.

No. The required amount is greater than 2/3 (67%) not greater than 1/2 (51%) on PoS for Ethereum. Also, see this tweet from Vitalik: https://twitter.com/VitalikButerin/status/130129808602782105... So even if there was a successful first attack from some organised body that's all the time they get.

Correct me if I'm wrong, but you would only need greater than 2/3 of the amount of Ether currently staked, not 2/3 of the total amount of Ether. The amount of staked Ether probably would be less than 10% of the total issued Ether, maybe much less as staking rewards go down.

Correct it is of the staked Ether not total supply. It's an important detail of course and easily missed, a good way for future people stumbling across here to think about it is that any attack only involves those participating in consensus. For Bitcoin consensus is mining. For the beacon Ethereum chain consensus is staking, therefore only staking Ether is relevant.

Re: Ethereum 2.0 launches

#559

Post by wocram »

kgilpin wrote: post #508
dmihal wrote: post #475

Earlier quoted context omitted.

Bitcoin isn't valuable because of its technical properties, just like gold isn't valuable because of its physical properties. Both are valuable because of their universally recognized scarcity and value. If you want to put your wealth in a SoV cryptocurrency, Bitcoin is the clear schelling point. Ether will remain competitive with BTC, it may even flip it in market cap, but I doubt Bitcoin will ever go away.

Bitcoin is valuable because of its value?

Just like USD :)

Re: Ethereum 2.0 launches

#560

Post by socialentity »

hnick wrote: post #507

This might be as good a place as any to ask, since I'm completely out of the loop on the scene: Are there any successful crypto schemes that use human effort (labour) instead of capital/computing effort? Something like Captcha or Mechanical Turk, hopefully something generally useful to society at large. Solving problems that computers can't (yet). It would seem to be a way to avoid the rich-get-richer aspect because…

Gold?
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