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Merge soon

ultrasound.money

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Re: Merge soon

#121

Post by jhugo »

capableweb wrote: post #106
tzekid wrote: post #104

Earlier quoted context omitted.

As far as I understand, without any work (energy consumption) that is directly tied to the value of the asset, there's no argument left for it to be a currency, i.e. it can only be categorised as a security asset.

Buying Eth: No investment in a common enterprise, no expectation of profit nor is that non-profit derived from others. Not a security. Staking Eth: Investment in common enterprise, expectation of profit and profit derived from others. Looks and quacks like a security. Buying and holding Eth without staking it shouldn't be considered a security, while staking said Eth should be considered a security. At least if we're…

If there were two tokens, one of which was stakeable and the other not, traded separately but convertible, then sure. But that's not reality. ETH's value is in part defined by its ability to bear interest. Whether you personally stake or not has no bearing on whether your ETH is a security.

Re: Merge soon

#122

Post by chrisco255 »

pavlov wrote: post #83
chrisco255 wrote: post #68

Earlier quoted context omitted.

It's not a made up number any more than a stock's market cap. Is Apple really worth $2.5 trillion? I dunno, seems like a lot, but the market determines what things are worth. But for the record, there's more than $100B in USD-backed (cash and equivalents-backed) assets on the Ethereum blockchain. Plus billions of dollars worth of on-chain organizations and applications that exist (Uniswap, Aave, Compound, GMX, etc).…

> "It's not a made up number any more than a stock's market cap." This is a common crypto talking point but it makes no sense. Companies are regularly acquired at a premium to their market cap, often in cash. For instance, Elon Musk signed an agreement to pay $44 billion to take Twitter private. Assuming the deal goes through, every single shareholder of Twitter is going to receive cash in exchange for their shares.…

Pretty bad example because Elon Musk is currently in court to back out of the deal or get the price reduced.

Companies are also regularly liquidated for next to nothing or go bankrupt and disappear altogether (ie Enron, Lehman, et al).

There is no such process for cryptos because they are decentralized and no one owns 100% of the supply or has the authority to authorize a takeover. They are more akin to commodities in that sense. Could you buy all the world's lumber supply? Of course not, not even if you were Musk.

Ethereum has been a yield producing asset since Beacon chain went live in December of 2020.

Re: Merge soon

#123

Post by machina_ex_deus »

betwixthewires wrote: post #117
machina_ex_deus wrote: post #63

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…

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 th…

The volumes of ETH trading are always orders of magnitude lower than how much the whales hold.

Market manipulation is prevalent in all markets all the time. The risk of market manipulation comes from other participants (the bigger a share of the market a whale has, the less risk he has) and from real world anchors (which are what sets the price of stocks in the longer term despite their short term randomness).

ETH whales always had the ability to do price manipulation. And they did it to some extent mostly to the upside. But they risked breaking the market if they manipulated to the downside.

The miners also had real world selling incentives. The game was rigged but at least price incentives aligned.

The problem isn't about whether PoS works. The problem is that the lack of real world anchors means the whales are free to manipulate price as they please. They can agree as a cartel on a price, low or high, beforehand, and keep buying from retail low and sell high and gain higher and higher share, manipulating both to the upside and the downside.

The problem is that PoS has no downside price manipulation disincentives, and it encourages hoarding. You'll end up like diamonds where most of those are hidden outside the market by a huge whale that exploits a monopoly on supply.

Re: Merge soon

#124

Post by tornato7 »

thrdbndndn wrote: post #34
sdfhbdf wrote: post #25

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/

I have a vague idea of ETH merge, but not sure what this ultrasound money site is about. From Q&A: > 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.

Bitcoiners often call BTC 'Sound Money' - ultrasound money is a play on that to highlight that Ethereum simply has better economics after the merge

Re: Merge soon

#125

Post by noch »

pavlov wrote: post #83
chrisco255 wrote: post #68

Earlier quoted context omitted.

It's not a made up number any more than a stock's market cap. Is Apple really worth $2.5 trillion? I dunno, seems like a lot, but the market determines what things are worth. But for the record, there's more than $100B in USD-backed (cash and equivalents-backed) assets on the Ethereum blockchain. Plus billions of dollars worth of on-chain organizations and applications that exist (Uniswap, Aave, Compound, GMX, etc).…

> "It's not a made up number any more than a stock's market cap." This is a common crypto talking point but it makes no sense. Companies are regularly acquired at a premium to their market cap, often in cash. For instance, Elon Musk signed an agreement to pay $44 billion to take Twitter private. Assuming the deal goes through, every single shareholder of Twitter is going to receive cash in exchange for their shares.…

> Coins don't pay dividends. They don't represent any kind of underlying assets.

Every honest crypto market participant has long admitted that no one currently knows a good model for valuing crypto tokens. Indeed this is widely accepted. As a result, there is such a massive speculative premium placed on them and their prices are extremely volatile.

However, Ethereum will now pay a yield native to the protocol and so discounted [cashflows][1] apply in "Eth" terms. To try to value that ["internet dividend"][0] in USD is, however, still speculation and so ultimately reliant on global [liquidity][2] conditions (how much banks "print").

[0]: https://link.medium.com/HGOCQMUbltb The Web 3.0 Yield Curve

[1]: https://ethereumcashflow.com (pdf)

[2]: https://twitter.com/42macro/status/1550487881956802563

Re: Merge soon

#126

Post by PufPufPuf »

zionic wrote: post #17
RestlessMind wrote: post #11

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?

Exactly. This is a triumph and the entire open source community should be celebrating

No, this is a blockchain "triumph" only blockchain people care about.

Re: Merge soon

#127

Post by PufPufPuf »

RestlessMind wrote: post #11

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?

No, it's absolutely not as significant as you make it. Nobody outside the crypto community really cares.

Re: Merge soon

#128

Post by DennisP »

jhugo wrote: post #120
DennisP wrote: post #112

Earlier quoted context omitted.

It's not passive though. You get paid for running a node and validating transactions. You stake ETH as a surety bond that you'll do it correctly.

Those things are not as coupled as you make them sound: the vast majority of people getting paid interest on their ETH won't be running a node. They'll be receiving interest passed on by exchanges or other centralised entities that are staking their ETH.

And if those entities give them some kind of token they can trade around, giving them rights to their deposit plus some profits, that token might well be a security.

But if I loan you dollars and you promise to do something profitable and give me more dollars back, that doesn't make the dollar a security.

Re: Merge soon

#129

Post by DennisP »

machina_ex_deus wrote: post #123
betwixthewires wrote: post #117

Earlier quoted context omitted.

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 th…

The volumes of ETH trading are always orders of magnitude lower than how much the whales hold. Market manipulation is prevalent in all markets all the time. The risk of market manipulation comes from other participants (the bigger a share of the market a whale has, the less risk he has) and from real world anchors (which are what sets the price of stocks in the longer term despite their short term randomness). ETH wh…

ETH that's being staked is not available on exchanges to trade. If that manipulation is occurring, then PoS will reduce it by giving whales an incentive to take their ETH off the market, to stake it instead.

Re: Merge soon

#130

Post by [deleted] »

krainboltgreene wrote: post #119
dist1ll wrote: post #38

Earlier quoted context omitted.

Several reasons come to mind: - Operating systems, browsers, etc are not distributed systems. Their deployment procedure has no availability or liveness requirement. And they can be done asynchronously, at the discretion of the user. If you think about it, deployment for this type of software boils down to uploading build artifacts into a public folder. - Most other massively deployed software is developed by a singl…

> Operating systems, browsers, etc are not distributed systems This is a hilarious statement. > Their deployment procedure has no availability or liveness requirement. Only to be followed by this.

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