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Ethereum: A Store of Value with Cash Flow [pdf]

ethereumcashflow.com

81–90 of 302 posts

Re: Ethereum: A Store of Value with Cash Flow [pdf]

#81
post #60

Cash flow is for businesses. Ethereum doesn’t know what it is. The rules are always changing, running a full node is practically impossible, and issuance is always changing. It’s not even clear that the features claimed in this paper will be true one year from now. Multiple consensus failures (most recently this last month) and constant design changes do not provide a secure foundation for sound money.

It could be a case of the perfect is the enemy of the good though.

I mean Ethereum isn't perfect but not much else is either.

Re: Ethereum: A Store of Value with Cash Flow [pdf]

#82
post #43

Earlier quoted context omitted.

The potential issue isn't spontaneous breakage, but rather a determined attacker exploiting the incentive structure in an unexpected manner. And the financial motivation to do this is much greater for ETH since it's around 100 times more liquid than ALGO.

It will likely not fail due to a direct attack on PoS. Ethereum has shown they are willing to rollback the chain in case of attacks. What's more concerning is that Proof of Wealth (which is what Stake really is), is just going to lead to those with biggest balances dictating rules to everyone else. Exactly what happened in EOS, Steem, etc... It will become a plutocracy with cute emojis.

>It will become a plutocracy with cute emojis.

Three comments repeating the same point are not enough, you should spam this argument some more, maybe then it will make sense.

Re: Ethereum: A Store of Value with Cash Flow [pdf]

#83
post #54
post #42

Earlier quoted context omitted.

A regular centralized company wouldn't want to necessarily use the ETH blockchain. They would use a private blockchain for internal auditing or supply chain partnerships, and would probably build it on something like HyperLedger https://www.hyperledger.org/use/fabric (What?! The Linux Foundation??). Binance did fork ETH and has built out the Binance Smart Chain. Problem is that is still centralized. The unresolved de…

Why would any company build a private blockchain? Private companies have top to bottom control of their systems, which means they don't need proof of work or proof of stake or any other system to establish trust: they can just issue PKI keys to employees from a database. Private blockchain has never made any sense: you just give all your employees private keys and move on with your life. EDIT: Which is to say, I'm su…

Because consortiums of companies exist?

Because companies don't really trust each other and have huge legal teams review 100+ pg contracts? Even internally trust is lacking at times?

It does have some efficiencies. They are likely tiny compared to separating money and state, like we managed to separate religion and state.

Re: Ethereum: A Store of Value with Cash Flow [pdf]

#84

Earlier quoted context omitted.

> You're comparing a risk-free rate (government bonds) > with a rate on risky investments. I don't think so. What is the "risky investment" here? I compared lending of different currencies. In the case of Euros or Dollars, the lender is a government. In the case of crypto, the lender is a smart contract. Both are assumed to be reliable.

The last resort of the US, UK, etc. governments is to print money if they really want to avoid defaulting on their debt. Can smart contracts print money? Surely there must be some way for the counterparty in the contract to default.

"Defaulting" in crypto means the collateral goes from the borrower to the lender. The collateral is always more valuable than the borrowed asset. Otherwise, all borrowers would "default" all the time. As there is no other downside to it than to lose your collateral.

Re: Ethereum: A Store of Value with Cash Flow [pdf]

#85

It will be interesting to see if interest rates in government controlled currencies and crypto currencies will stay diverged in the long run. Without the distorting action of governments printing money, interest rates might be set by market forces in "crypto land". This might lead to a long term situation where artificially low interest rates are paid in government controlled currencies, but market prices are paid in…

Since ETH staking returns do represent a (sort of) risk free rate for ETH denominated loans, low fiat rates would pull down on those rewards, if the exchange rate volatility comes enough for people to stomach the currency risk.

The same sort of flows balance exchange rates and interest rates among national currencies, though as you point out, sufficient risks and controls abound to prevent complete parity between the rates.

I’d challenge the notion that one side is paying market rates, and one isn’t, at least in nominal terms. Bond purchases and ETH stakes are both market transactions at the prevailing rate, just with different structural forces in play.

Re: Ethereum: A Store of Value with Cash Flow [pdf]

#86
post #74

Earlier quoted context omitted.

How do you define a pyramid scheme? Thing go up in value?

I'd basically see it as an investment opportunity that greatly favours early adopters.

70% of ethereum was sold at rock bottom prices to "early adopters" in a presale.

You are right. It is a ponzi.

Re: Ethereum: A Store of Value with Cash Flow [pdf]

#87

What mostly excites me about Ethereum ist the very vibrant ecosystem of developers and builders around it. You can think of NFTs and DeFi whatever you want, the sheer amount of new applications and innovative ideas on the ethereum blockchain has been mind-boggling. My personal favorite is Sorare, which combines NFT collectibles with fantasy soccer. And sure, right now everything suffers from high gas prices but it lo…

Ethereum is quite exciting in that regard, but my feeling is that most eth enthusiasts don't actually care about that. They only care about the value and thus it has become another crypto pyramid scheme for now. The only crypto community who has shown any genuine effort in creating a "currency" is Dogecoin. And that is mainly because they are more aware that their coin has no value without real adoption. But sadly, e…

There is no doubt that it's a pyramid scheme.

Everything is a pyramid scheme these days including the entire stock market (especially big tech).

But the modern monetary system is designed to sustain such pyramid schemes. It can keep them going forever. No matter how much net value they destroy; it will offload the costs to fiat salary earners who accept fiat currencies.

TBH I'm confused how the world economy is able to keep running at all with all these extreme inefficiencies everywhere.

Re: Ethereum: A Store of Value with Cash Flow [pdf]

#88

Personally, I've moved all of my funds from other currencies into Ethereum. Not that I think it will make lots of money, but because Ethereum actually could have utility, and has a solution to the climate change impacts of Bitcoin. So really, if I'm going to hold any cryptocurrencies, that's where I want them

Proof of Stake just means those with the biggest money bags (stake sounds so much better than wealth) rule over you, explicitly. It is simply plutocracy, but with cute emojis.

So we don’t have plutocracy in the current fiat money system(s)? Relative inequality is super low and investment opportunities abound for all income levels?

We don’t have a plutocracy in PoW coins like BTC either right? Super cheap and easy to spin up a mining operation I heard.

Re: Ethereum: A Store of Value with Cash Flow [pdf]

#89
post #10

The fact that something is scarce doesn't make it a store of value. Scarce simply means is in short supply, but prices aren't determined by supply alone, they are determined by supply and demand. Moreover, if an asset is in fixed supply, then its price is determined entirely by the demand. This means such an asset will only be a store of value if the demand for the asset remains strong over a long period of time, whi…

The money behind big tech has mastered manipulating demand and that is exactly what you are seeing in the Ethereum/NFT ecosystem.

It is one giant fraud bankrolled by unlimited capital that can artificially increase prices at which point there becomes demand from people in fear of missing out, once the early capital has the suckers locked in the prices plateau at first as the capital stops buying and driving the price up, and then begins a steep crash as they cash out and lock in the gains, this only causes fear and panic among the late entries that made investments at the peak which they couldn't afford to lose...rinse and repeat.

The NFTs may be even more blatant and egregious than the ERC20 coins in terms of fake sales driving up interest, media and demand for shit no regular investor will ever flip. A lot of it is just transparent fraud and money laundering, with the people involved not even shying away from it but openly justifying it on the basis they feel the stock market and art collectors have always engaged in the same misconduct.

Take Elon Musk, openly pumping Doge...I'm not judging, I get the humor in it, but a lot of people have been crushed over the years in the crypto bubbles, yesterday was a prime example where Elon was likely the sole cause of Doge exploding in value (maybe 5x in a few days and 100x over a month) and as the big money way slowly cashing out these massive media campaigns were behind a marketing scam of "DogeDay" essentially making their killing on the backs of the poor uneducated late investors. One would hope his Tweets shined a bright light on the dystopia of it all, but it seems everyone is either so greedy or in such bad positions financially they would rather take part.

My guess is now that they have reaped their profits at the expense of the little guy, they will buy back in with the profits and we should see another pump following the -25% DogeDay scam.

Re: Ethereum: A Store of Value with Cash Flow [pdf]

#90

What mostly excites me about Ethereum ist the very vibrant ecosystem of developers and builders around it. You can think of NFTs and DeFi whatever you want, the sheer amount of new applications and innovative ideas on the ethereum blockchain has been mind-boggling. My personal favorite is Sorare, which combines NFT collectibles with fantasy soccer. And sure, right now everything suffers from high gas prices but it lo…

All those things will never break among the common folk. The common folk wants ease of use above anything else. It has to be as easy as sending money via paypal. No doubt ETH can be the base of that technically, but the model which has ETH holders make money off the appreciation of the ETH token in the process is flawed. Fortune500 and even startups who'd use the open source ETH blockchain technology to bring many se…

>All those things will never break among the common folk. The common folk wants ease of use above anything else

In my experience the common folk want number go up above anything else.

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