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Why should you care about Ethereum Layer-2?

thecryptojournal.substack.com

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Re: Why should you care about Ethereum Layer-2?

#61

Post by riptheworld »

lottin wrote: post #59
riptheworld wrote: post #58

Earlier quoted context omitted.

You could use existing trusted lending Institutions, no? Investors can loan their excess Bitcoin to a lending institution that pools Bitcoin from multiple investors and loans it out to borrowers? In return, the investor receives interest on the loaned amount when it is paid back in full? If the loan isn’t repaid, the courts get involved to seize other physical assets from the borrower (cars, homes, etc.). In some sen…

Nothing prevents crypto-currency denominated loans in traditional finance. That was not the claim. The claim is that financing operations are not possible in so-called "decentralised finance".

Ahh I see! Thanks for the clarification!

Re: Why should you care about Ethereum Layer-2?

#62

Post by tata71 »

_ink_ wrote: post #52
tata71 wrote: post #47

Earlier quoted context omitted.

Temporarily, until people realize they are a sidechain, and Loopring does what they do without inherent added security risks.

Why is Solana a side chain?

Not sure how to answer the question.

This is like asking "why are Google services centralized?".

Re: Why should you care about Ethereum Layer-2?

#63

Post by dannyw »

lottin wrote: post #37
dannyw wrote: post #34

Earlier quoted context omitted.

Mortgages are overcollateralized loans. Credit cards are loans based on future income streams (which can be securitised in fact with crypto technology -- think a defi bank automatically getting 20% of your future income until it is repaid)

The problem isn't overcollateralisation itself but the inability to seize the collateral in particular, and assets in general. A mortgage depends crucially on the bank's ability to seize the collateral in the event of default, and the same applies to credit cards. The problem is blockchain assets are unconfiscatable, which means any form of financing involving such assets is unworkable.

No, blockchain assets can be confiscated. Maker, Aave, confiscate and liquidated billions of assets in the past few days.

Smart contracts are Turing complete and you can build anything with it. You can even build an opt-in judiciary system with the power to reverse transactions.

I think you'll be pleasantly surprised if you look at how DeFi actually works.

Re: Why should you care about Ethereum Layer-2?

#64

Post by landemva »

zomglings wrote: post #25
bruce343434 wrote: post #11

Earlier quoted context omitted.

Why isn't etherium deprecated then and everyone moves to polygon? What's the catch?

I can perhaps shed some light on this. I am the founder of Moonstream ( https://moonstream.to ). Our customers use our API to consume on-chain events from their off-chain infrastructure. We currently support Ethereum and Polygon, and run our own nodes on both blockchains. Polygon is much less decentralized than Ethereum. There are 100 validators on the network. In the future, there will be some sort of scoring and au…

The crystallized 100 validator set has concerned me, and has caused me to presently not run a validator to learn. I was unaware of frequent reorgs.

Re: Why should you care about Ethereum Layer-2?

#66

Post by lottin »

dannyw wrote: post #63
lottin wrote: post #37

Earlier quoted context omitted.

The problem isn't overcollateralisation itself but the inability to seize the collateral in particular, and assets in general. A mortgage depends crucially on the bank's ability to seize the collateral in the event of default, and the same applies to credit cards. The problem is blockchain assets are unconfiscatable, which means any form of financing involving such assets is unworkable.

No, blockchain assets can be confiscated. Maker, Aave, confiscate and liquidated billions of assets in the past few days. Smart contracts are Turing complete and you can build anything with it. You can even build an opt-in judiciary system with the power to reverse transactions. I think you'll be pleasantly surprised if you look at how DeFi actually works.

No, Maker & Aave haven't confiscated anything in the past few days. Either you don't know what 'confiscate' means or you don't know how Maker & Aave, and DeFi lending in general, work.

Re: Why should you care about Ethereum Layer-2?

#68

Post by muzikman1 »

dcposch wrote: post #7

Kneejerk dismissals here are sad to see. L2 is, in my view, some of the most interesting research happening in computer science right now. The article above is not a great explanation--in particular, L2s are not off-chain as the article presents. The point of L2 is that it on-chain, inheriting the security and censorship resistance guarantees of L1. To simplify: L2 is about creating a fast, high throughput state mach…

Thank you for your reply.

It does not say it's 'off-chain'. It says that the scalability solution is off-chain - 'can process transactions off-chain'.

See: https://ethereum.org/en/developers/docs/scaling/

Re: Why should you care about Ethereum Layer-2?

#69

Post by zomglings »

landemva wrote: post #64
zomglings wrote: post #25

Earlier quoted context omitted.

I can perhaps shed some light on this. I am the founder of Moonstream ( https://moonstream.to ). Our customers use our API to consume on-chain events from their off-chain infrastructure. We currently support Ethereum and Polygon, and run our own nodes on both blockchains. Polygon is much less decentralized than Ethereum. There are 100 validators on the network. In the future, there will be some sort of scoring and au…

The crystallized 100 validator set has concerned me, and has caused me to presently not run a validator to learn. I was unaware of frequent reorgs.

I don't think they would be able to hit the block rate they do if they allowed more validator nodes.
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