Thread by @madcapslaugh

1/ oh gosh, please forgive me, @mhass33 and I just started writing this [THREAD] and now its gotten out of control....

@mhass33 2/ Over a year ago I began professionally following Ethereum. I made lots of friends, saw how valuable community is. Traveled the world, tinkered with my own dApps, analysed countless projects for token economics. I thought it would be good to publish my notes. Brace yourself

@mhass33 3/ Ethereum gets a bad rap in the crypto market today, its much more fun to hate it then appreciate what has been built and what can be built
coindesk.com/scam-or-iterat…

@mhass33 4/ There are a few perma eth bulls, but the market as a whole is rooting for Ethereum’s demise. @RyanSAdams @TrustlessState @sassal0x its a lonely fight, but you guys are doing a great job.

@mhass33 @RyanSAdams @TrustlessState @sassal0x 5/ @ConsenSys published a great piece about the state of Ethereum in 2019, if you work in this industry and you have not read this, shame on you! consensys.net/blog/news/ethe…

@mhass33 @RyanSAdams @TrustlessState @sassal0x @ConsenSys 6/ The leading position in smart contracts is Ethereum’s race to lose, we looked at the market and invested in some of the competition we see could become a leader if #ETH struggles
@NEARProtocol
@solana @NervosNetwork
ETH1 scaling solutions @loomnetwork and @SkaleNetwork

@mhass33 @RyanSAdams @TrustlessState @sassal0x @ConsenSys @NEARProtocol @solana @NervosNetwork @loomnetwork @SkaleNetwork 7/ There is a reason why quality teams like @StarkWareLtd are building on Ethereum. There just isn't any other good place to be today

@mhass33 @RyanSAdams @TrustlessState @sassal0x @ConsenSys @NEARProtocol @solana @NervosNetwork @loomnetwork @SkaleNetwork @StarkWareLtd 8/ There are a lot of things wrong with Ethereum today and some of these things are more economic than technical, and its generally not about scaling.
@NervosNetwork gets it.

@mhass33 @RyanSAdams @TrustlessState @sassal0x @ConsenSys @NEARProtocol @solana @NervosNetwork @loomnetwork @SkaleNetwork @StarkWareLtd 9/ One of the economic/investment challenges in the space is that you make a lot more money by building/rooting for an eth competitor than working on improving eth
@Algorand
@blockstack
@hashgraph
this splits talent and leadership between teams that have high overlaps

@mhass33 @RyanSAdams @TrustlessState @sassal0x @ConsenSys @NEARProtocol @solana @NervosNetwork @loomnetwork @SkaleNetwork @StarkWareLtd @Algorand @blockstack @hashgraph 10/ I sat with Vitalik for an hour long chat after i got kicked out of @ScalingBitcoin (no ticket), he put it very nicely, you have VC coins and Professor coins, but you dont have any good marketing coins, and building a community is just as important as being technically sound

@mhass33 @RyanSAdams @TrustlessState @sassal0x @ConsenSys @NEARProtocol @solana @NervosNetwork @loomnetwork @SkaleNetwork @StarkWareLtd @Algorand @blockstack @hashgraph @ScalingBitcoin 11/ in my mind, none of these platforms really compete with #BTC, as a rule of thumb if you have a face, you don't compete with BTC

@mhass33 @RyanSAdams @TrustlessState @sassal0x @ConsenSys @NEARProtocol @solana @NervosNetwork @loomnetwork @SkaleNetwork @StarkWareLtd @Algorand @blockstack @hashgraph @ScalingBitcoin 12/ Crypto is a social movement, it's only valuable because people attribute it value, one of the things competitors to ethereum will struggle with is building a community and creating a wide distribution of tokens

@mhass33 @RyanSAdams @TrustlessState @sassal0x @ConsenSys @NEARProtocol @solana @NervosNetwork @loomnetwork @SkaleNetwork @StarkWareLtd @Algorand @blockstack @hashgraph @ScalingBitcoin 13/ A few weeks ago I got to chat with @VladZamfir , @ethereumJoseph , and @VitalikButerin , to hear (briefly) first hand what each thought about the space

@mhass33 @RyanSAdams @TrustlessState @sassal0x @ConsenSys @NEARProtocol @solana @NervosNetwork @loomnetwork @SkaleNetwork @StarkWareLtd @Algorand @blockstack @hashgraph @ScalingBitcoin @VladZamfir @ethereumJoseph @VitalikButerin 14/ Joseph said to invest in companies that make Ethereum scalable

@mhass33 @RyanSAdams @TrustlessState @sassal0x @ConsenSys @NEARProtocol @solana @NervosNetwork @loomnetwork @SkaleNetwork @StarkWareLtd @Algorand @blockstack @hashgraph @ScalingBitcoin @VladZamfir @ethereumJoseph @VitalikButerin 15/ Vitalik said ETH will be whatever the community wants it to be

@mhass33 @RyanSAdams @TrustlessState @sassal0x @ConsenSys @NEARProtocol @solana @NervosNetwork @loomnetwork @SkaleNetwork @StarkWareLtd @Algorand @blockstack @hashgraph @ScalingBitcoin @VladZamfir @ethereumJoseph @VitalikButerin 16/ Vitalik and @beller (Libra) sat with me for over an hour and answered every question I could fire off at them about ethereum. In short, Libra is flexible and motivated, and could be built on ETH2, but probably wont

@mhass33 @RyanSAdams @TrustlessState @sassal0x @ConsenSys @NEARProtocol @solana @NervosNetwork @loomnetwork @SkaleNetwork @StarkWareLtd @Algorand @blockstack @hashgraph @ScalingBitcoin @VladZamfir @ethereumJoseph @VitalikButerin @beller 17/ Ethereum is a hard concept to explain, is it "MONEY", a world computer, a programmable money system, a cloud storage provider, an immutable ledger, an ICO launching platform? The answer is unclear, but it sure is awesome!

@mhass33 @RyanSAdams @TrustlessState @sassal0x @ConsenSys @NEARProtocol @solana @NervosNetwork @loomnetwork @SkaleNetwork @StarkWareLtd @Algorand @blockstack @hashgraph @ScalingBitcoin @VladZamfir @ethereumJoseph @VitalikButerin @beller 18/ Bitcoin is easy to explain, you can just learn about the history of money, how money broke after WWI, and how BTC fixes this. @NickSzabo4 @thebitcoinrabbi and @saifedean do a great job explaining this. even to little kids nakamotoinstitute.org/shelling-out/

@mhass33 @RyanSAdams @TrustlessState @sassal0x @ConsenSys @NEARProtocol @solana @NervosNetwork @loomnetwork @SkaleNetwork @StarkWareLtd @Algorand @blockstack @hashgraph @ScalingBitcoin @VladZamfir @ethereumJoseph @VitalikButerin @beller @NickSzabo4 @thebitcoinrabbi @saifedean 19/ The creation of #BTC was something magical, PoW is well designed, and IMHO not wasteful. medium.com/@danhedl/pow-i…

@mhass33 @RyanSAdams @TrustlessState @sassal0x @ConsenSys @NEARProtocol @solana @NervosNetwork @loomnetwork @SkaleNetwork @StarkWareLtd @Algorand @blockstack @hashgraph @ScalingBitcoin @VladZamfir @ethereumJoseph @VitalikButerin @beller @NickSzabo4 @thebitcoinrabbi @saifedean 20/ The 21m meme of bitcoin is one of its strongest selling points, some people criticise it, saying that there are a limited supply of old junky cars, but that doesn't make them valuable, this misses the point, BTC has utility that an old car does not

@mhass33 @RyanSAdams @TrustlessState @sassal0x @ConsenSys @NEARProtocol @solana @NervosNetwork @loomnetwork @SkaleNetwork @StarkWareLtd @Algorand @blockstack @hashgraph @ScalingBitcoin @VladZamfir @ethereumJoseph @VitalikButerin @beller @NickSzabo4 @thebitcoinrabbi @saifedean 21/ Eth does not have a fixed issuance, which makes it more complicated to explain why it will be a deflationary asset. @TrustlessState has some good thoughts on how to get around this thedefiant.substack.com/p/ether-is-the… but its still hard to explain. especially to a no-coiner.

@mhass33 @RyanSAdams @TrustlessState @sassal0x @ConsenSys @NEARProtocol @solana @NervosNetwork @loomnetwork @SkaleNetwork @StarkWareLtd @Algorand @blockstack @hashgraph @ScalingBitcoin @VladZamfir @ethereumJoseph @VitalikButerin @beller @NickSzabo4 @thebitcoinrabbi @saifedean 22/ The problem with eth is that the monetary policy isnt set, 21m is a strong shelling point for btc, the eth issuance is potentially updated every time the network is hard forked for an upgrade, which happens at least once a year. "minimum viable issuance" is hard to swallow

@mhass33 @RyanSAdams @TrustlessState @sassal0x @ConsenSys @NEARProtocol @solana @NervosNetwork @loomnetwork @SkaleNetwork @StarkWareLtd @Algorand @blockstack @hashgraph @ScalingBitcoin @VladZamfir @ethereumJoseph @VitalikButerin @beller @NickSzabo4 @thebitcoinrabbi @saifedean 23/ Without a fixed cap its hard to position eth as a commodity like gold, and instead it appears like fiat which can be printed at will by a small group of people, and moving to PoS means that there is little to no external costs to printing new coins

@mhass33 @RyanSAdams @TrustlessState @sassal0x @ConsenSys @NEARProtocol @solana @NervosNetwork @loomnetwork @SkaleNetwork @StarkWareLtd @Algorand @blockstack @hashgraph @ScalingBitcoin @VladZamfir @ethereumJoseph @VitalikButerin @beller @NickSzabo4 @thebitcoinrabbi @saifedean 24/ Because 21m is a central part of the narrative of btc, it will be hard for the community to accept changing the block rewards, even if it becomes necessary.

@mhass33 @RyanSAdams @TrustlessState @sassal0x @ConsenSys @NEARProtocol @solana @NervosNetwork @loomnetwork @SkaleNetwork @StarkWareLtd @Algorand @blockstack @hashgraph @ScalingBitcoin @VladZamfir @ethereumJoseph @VitalikButerin @beller @NickSzabo4 @thebitcoinrabbi @saifedean 25/ @ArthurB from #tezos wrote a great post about this, ex.rs/on-supply-caps/ we got to speak about this briefly when he was in Tel aviv, he is in general a fan of btc

@mhass33 @RyanSAdams @TrustlessState @sassal0x @ConsenSys @NEARProtocol @solana @NervosNetwork @loomnetwork @SkaleNetwork @StarkWareLtd @Algorand @blockstack @hashgraph @ScalingBitcoin @VladZamfir @ethereumJoseph @VitalikButerin @beller @NickSzabo4 @thebitcoinrabbi @saifedean @ArthurB 26/ In short... Block rewards are a tax on the holders of the networks native assets, they dilute the % of ownership of the native asset to pay for good behaviour, ie security, of the block producers.

@mhass33 @RyanSAdams @TrustlessState @sassal0x @ConsenSys @NEARProtocol @solana @NervosNetwork @loomnetwork @SkaleNetwork @StarkWareLtd @Algorand @blockstack @hashgraph @ScalingBitcoin @VladZamfir @ethereumJoseph @VitalikButerin @beller @NickSzabo4 @thebitcoinrabbi @saifedean @ArthurB 27/ The fear is that if inflation decreases to 0, the only thing keeping the block producers honest is transaction fees, which may be low enough that block producers can be bribed to reverse transactions @danheld models why its all good blog.picks.co/bitcoins-secur…

@mhass33 @RyanSAdams @TrustlessState @sassal0x @ConsenSys @NEARProtocol @solana @NervosNetwork @loomnetwork @SkaleNetwork @StarkWareLtd @Algorand @blockstack @hashgraph @ScalingBitcoin @VladZamfir @ethereumJoseph @VitalikButerin @beller @NickSzabo4 @thebitcoinrabbi @saifedean @ArthurB @danheld 28/ @hasufl and @_prestwich discuss some ways to get around the block reductions uncommoncore.co/wp-content/upl…

@mhass33 @RyanSAdams @TrustlessState @sassal0x @ConsenSys @NEARProtocol @solana @NervosNetwork @loomnetwork @SkaleNetwork @StarkWareLtd @Algorand @blockstack @hashgraph @ScalingBitcoin @VladZamfir @ethereumJoseph @VitalikButerin @beller @NickSzabo4 @thebitcoinrabbi @saifedean @ArthurB @danheld @hasufl @_prestwich 29/ The fix cap probably will work, even though lots of people have questions about it, good thing is we will get to see how it stands up over the next 8 years or so. cryptobriefing.com/bitcoin-halvin…

@mhass33 @RyanSAdams @TrustlessState @sassal0x @ConsenSys @NEARProtocol @solana @NervosNetwork @loomnetwork @SkaleNetwork @StarkWareLtd @Algorand @blockstack @hashgraph @ScalingBitcoin @VladZamfir @ethereumJoseph @VitalikButerin @beller @NickSzabo4 @thebitcoinrabbi @saifedean @ArthurB @danheld @hasufl @_prestwich 30/ The government knows that bitcoin cant be stopped, and they are adjusting their views on this

@mhass33 @RyanSAdams @TrustlessState @sassal0x @ConsenSys @NEARProtocol @solana @NervosNetwork @loomnetwork @SkaleNetwork @StarkWareLtd @Algorand @blockstack @hashgraph @ScalingBitcoin @VladZamfir @ethereumJoseph @VitalikButerin @beller @NickSzabo4 @thebitcoinrabbi @saifedean @ArthurB @danheld @hasufl @_prestwich 31/ Facebook’s Libra will launch and will onboard the general world to crypto but will be closer to AOL than the general internet we have today

@mhass33 @RyanSAdams @TrustlessState @sassal0x @ConsenSys @NEARProtocol @solana @NervosNetwork @loomnetwork @SkaleNetwork @StarkWareLtd @Algorand @blockstack @hashgraph @ScalingBitcoin @VladZamfir @ethereumJoseph @VitalikButerin @beller @NickSzabo4 @thebitcoinrabbi @saifedean @ArthurB @danheld @hasufl @_prestwich 32/ Bitcoin is a revolution, revolting against fiat

@mhass33 @RyanSAdams @TrustlessState @sassal0x @ConsenSys @NEARProtocol @solana @NervosNetwork @loomnetwork @SkaleNetwork @StarkWareLtd @Algorand @blockstack @hashgraph @ScalingBitcoin @VladZamfir @ethereumJoseph @VitalikButerin @beller @NickSzabo4 @thebitcoinrabbi @saifedean @ArthurB @danheld @hasufl @_prestwich 33/ I buy bitcoin to give to my children,the same way I would buy gold and hide it for them

@mhass33 @RyanSAdams @TrustlessState @sassal0x @ConsenSys @NEARProtocol @solana @NervosNetwork @loomnetwork @SkaleNetwork @StarkWareLtd @Algorand @blockstack @hashgraph @ScalingBitcoin @VladZamfir @ethereumJoseph @VitalikButerin @beller @NickSzabo4 @thebitcoinrabbi @saifedean @ArthurB @danheld @hasufl @_prestwich 34/ I don't know anyone that is comfortable buying eth with the plan on holding it for 20 years, not today, but I think as the platform matures we can get there

@mhass33 @RyanSAdams @TrustlessState @sassal0x @ConsenSys @NEARProtocol @solana @NervosNetwork @loomnetwork @SkaleNetwork @StarkWareLtd @Algorand @blockstack @hashgraph @ScalingBitcoin @VladZamfir @ethereumJoseph @VitalikButerin @beller @NickSzabo4 @thebitcoinrabbi @saifedean @ArthurB @danheld @hasufl @_prestwich 35/ Ethereum is a revolution against the patent office. It gives open source projects the ability to create defensible revenue streams without the need of a trusted third party

@mhass33 @RyanSAdams @TrustlessState @sassal0x @ConsenSys @NEARProtocol @solana @NervosNetwork @loomnetwork @SkaleNetwork @StarkWareLtd @Algorand @blockstack @hashgraph @ScalingBitcoin @VladZamfir @ethereumJoseph @VitalikButerin @beller @NickSzabo4 @thebitcoinrabbi @saifedean @ArthurB @danheld @hasufl @_prestwich 36/ DeFi shows the power of open source software that can move money around and can be stacked defipulse.com/defi-list/

@mhass33 @RyanSAdams @TrustlessState @sassal0x @ConsenSys @NEARProtocol @solana @NervosNetwork @loomnetwork @SkaleNetwork @StarkWareLtd @Algorand @blockstack @hashgraph @ScalingBitcoin @VladZamfir @ethereumJoseph @VitalikButerin @beller @NickSzabo4 @thebitcoinrabbi @saifedean @ArthurB @danheld @hasufl @_prestwich 37/ People ask is ETH money,being money is more of a spectrum than a yes or no question. In some circles, Pokemon cards are money

@mhass33 @RyanSAdams @TrustlessState @sassal0x @ConsenSys @NEARProtocol @solana @NervosNetwork @loomnetwork @SkaleNetwork @StarkWareLtd @Algorand @blockstack @hashgraph @ScalingBitcoin @VladZamfir @ethereumJoseph @VitalikButerin @beller @NickSzabo4 @thebitcoinrabbi @saifedean @ArthurB @danheld @hasufl @_prestwich 38/ Vitalik told me he thinks Eth does not need to be money to succeed, but being money is for sure helpful

@mhass33 @RyanSAdams @TrustlessState @sassal0x @ConsenSys @NEARProtocol @solana @NervosNetwork @loomnetwork @SkaleNetwork @StarkWareLtd @Algorand @blockstack @hashgraph @ScalingBitcoin @VladZamfir @ethereumJoseph @VitalikButerin @beller @NickSzabo4 @thebitcoinrabbi @saifedean @ArthurB @danheld @hasufl @_prestwich 39/ Vlad made a great point in my conversation with him about the dangers of on-chain governance, if a network can be compromised by token holders, you must consider that it has already happened

@mhass33 @RyanSAdams @TrustlessState @sassal0x @ConsenSys @NEARProtocol @solana @NervosNetwork @loomnetwork @SkaleNetwork @StarkWareLtd @Algorand @blockstack @hashgraph @ScalingBitcoin @VladZamfir @ethereumJoseph @VitalikButerin @beller @NickSzabo4 @thebitcoinrabbi @saifedean @ArthurB @danheld @hasufl @_prestwich 40/ I spoke with Arthur from Tezos and Ryan from Web3/Polkadot (at the time) and we spoke about how onchain governance is important for newly arrived big players to feel like they are investing in building on a platform where they can have influence

@mhass33 @RyanSAdams @TrustlessState @sassal0x @ConsenSys @NEARProtocol @solana @NervosNetwork @loomnetwork @SkaleNetwork @StarkWareLtd @Algorand @blockstack @hashgraph @ScalingBitcoin @VladZamfir @ethereumJoseph @VitalikButerin @beller @NickSzabo4 @thebitcoinrabbi @saifedean @ArthurB @danheld @hasufl @_prestwich 41/ These two views are not contradictory, on chain governance is important, but does prevent the creation of an agenda free platform. sometimes an agenda is a good thing. it depends on your goals

@mhass33 @RyanSAdams @TrustlessState @sassal0x @ConsenSys @NEARProtocol @solana @NervosNetwork @loomnetwork @SkaleNetwork @StarkWareLtd @Algorand @blockstack @hashgraph @ScalingBitcoin @VladZamfir @ethereumJoseph @VitalikButerin @beller @NickSzabo4 @thebitcoinrabbi @saifedean @ArthurB @danheld @hasufl @_prestwich 42/ Creating an agenda free platform is hard, the blockchain that succeeds will have the greatest censorship resistance and be the most anti fragile

43/ which is a large part of the value creation in this space, building a programmable money moving platform that cannot be corrupted or controlled by existing or future world powers

44/ Decentralisation is a feature, it’s not a goal. Decentralisation enables participants to trust that the system they investing into will remain consistent, with the same rules persisting into the future

45/ The base layer must be decentralised, but it’s ok if centralised things are built on top.
Platforms like XRP, EOS, Tron etc, are not in the same race as Ethereum because they have no path to becoming decentralised

46/ Bitcoin has survived a number of hostile takeover attempts, the most interesting of which was the No2X resistance movement, resulting in Bitcoin Cash forbes.com/sites/ktorpey/…

47/ The ability to run a full node ensures that the same network rule set which you initially agreed to, is the current rule set.

48/ Bcash is not a good idea because it makes running a full node more challenging, thus giving more control to miners to influence the future of the platform

49/ While many improvements have been made to date, Ethereum in general suffers from this same challenge. There are those that say it’s hard to run a full node, and in a sharded system it will only get more difficult.

50/ Ethereum needs to achieve feasible self-validation. Introducing state rent is a possible solution, but when I spoke with Vitalik, he shot down my emphasis on state rent saying that he was not confident how to manage it.

51/ He didn’t get into all the details, but my understanding is that if a contract gets revoked for not paying rent, it’s hard to identify who exactly should be paying for liveness- the user? the contract owner? the person building a dapp on the contract?….

52/ Not everyone needs to run a full node, but there should be enough people doing it to create checks and balance between devs, miners and node operators

53/ Infura and metamask are double edged swords for ethereum. Infura makes deployment and interaction with the existing web infrastructure easier, but it means that everyone is connecting to the same fail point
Metamask sucks because you need to install a plugin

54/ The ethereum foundation is also a double edged sword. It helps to coordinate improvements to the platform, and it is well funded, but it operates primarily behind a closed door. The EF’s influence over the direction of the platform challenges the open nature of ethereum

55/ Ethereum makes it easy to issue arbitrarily scarce digital assets, this is an amazing tool but to date has been primarily misused.

56/ The ICO bubble created thousands of scam projects which made many people money but lost many more people money. It was enabled through the permissionless issuance of tokens that could be sold for ETH

57/ Most ICOs issued payment tokens, which increased friction to the product they never built ;P, in most cases the blockchain or a unique token was never needed and the only reason they ICO’d was to fundraise from easily scammed investors

58/ The assumption behind the bubble was that mass adoption of real crypto products was around the corner, but we were really quite far away from economically sustainable products built on public blockchains

59/ Wallets are a huge potential money maker, but key management is too complicated for most people

60/ @ZenGo has a good solution, but its hard to explain how they dont have access to funds, yet can recover funds - if they get shut down by a bad state actor how will that work? @argentHQ has some great tools for fund security, but social key recovery is taxing

61/ If i have to write down another 12 word phrase i might just pop out my eyeballs, seriously i have like 50 of them at this point

62/ Installing metamask feels like installing flash to play a crappy game in 2002. @WalletConnect is my favorite

63/ Ethereum provides security and functionality for these digital assets, but the assets do not necessarily provide benefit to the network that they run apon

64/ @NervosNetwork is a multi-asset settlement chain, where the tokens essentially pay a tax to the native token holders, this is a very interesting approach but will need to a simple UX for end consumers

65/ I spoke to Vitalik about the issue of tether running on ethereum, driving up gas prices, benefiting from the security provided by ethereum but not necessarily giving back to the network, his take was the more that is built on ethereum the more valuable the network becomes

66/ People claim scalability is a bottleneck hurting crypto adoption, this is both true and not true, its true because spikes in usage increase network fees, but it’s also not true, because the killer app beyond the “self sovereign store of value” has not yet been discovered

67/ There exist many scalability solutions for ethereum today, powered by technology such as plasma, state channels, zk proofs etc, but none to date has attracted significant developer attraction. @StarkwareLTD looks very promising

68/ Actually Ethereum can scale 500x using zkp today, for many use cases, but it will take some work to put this into production. I spoke with both Vitalik and @EliBenSasson from Starkware, and we should see DEXs getting this kind of performance improvement in the near future

69/ Public blockchains will need to scale in order to gain adoption, but first they will need to figure out what they are good for, outside of trading tokens

70/ This last year has introduced many early indicators that decentralized businesses, organized by tokens, focused on providing services to customers, while taking a profit, will lead this industry to it’s next stage of development.

71/ The advantages of compossibility have become clear through services like @InstaDApp @SetProtocol and @synthetix_io and we are just getting started

72/ The ability to build an anti fragile marketplace, with no centralized leadership, but with clear roles of customers, service providers and maintainers, is the most promising use case beyond money that I have seen to date

73/ Cosmos is an attempt to take the scaling issue and make it a horizontal issue.
Binance left ethereum to become a cosmos island/planet
In cosmos each blockchain runs one application, or a small set of applications, secured by their own validators

74/ I was at a lecture by the Near guys in berlin where they talked about the challenge of overhead this presents to most projects, i sat with Illia

75/ after his presentation to push back on the concept that projects pick between a “soup to nuts” solution like ETH or go with a self service like Cosmos, I can see many projects start with ETH and move to cosmos as they grow.

76/ Ethereum has such a lead in terms of tooling and developer community it will be very difficult for the competitors to take the lead

77/ Bitcoin is not trying to be ethereum, it just wants to be sound money, it has a clear path to do this, as long as it doesn’t collapse

78/ Bitcoin doesn't care about the price of bitcoin, the higher the price the better brand, and the faster large transactions safely confirm. I think bitcoin could survive a drop to $1. I would buy a lot of them.

79/ At some point we will see a government publicly execute someone for owning btc, this will be good for bitcoin

80/ It’s impossible to use bitcoin as currency today because of the 10 min block times and the transaction fees (and privacy, volatility and other UX issues)

81/ LN claims to solve these issues but it needs to improve in UX, which is happening fast. there are great guys working on it like @pierre_rochard

82/ There are concerns over LN centralization, im not particularly concerned
Its ok for L2 to have different centralization properties than L1 as long as they are known and the market adjusts

83/ Ethereum has two paths to scalability, layer 2 on eth1 and eth2
It’s a question if eth2 will need a layer 2 of its own

84/ i asked vitalik his thoughts on this and he said he is coming around to the idea that eth2 with scaling solutions powered by zkp will be sufficient to handle world adoption

85/ Vitalik was the co-author of the plasma whitepaper, but he has now done a 180 on plasma, and said the security models don’t line up. I wonder what @maticnetwork thinks about this

86/ eth 2 is a hard project
There are lots of groups that are taking the eth 2 roadmap and trying to get to market faster

87/ Near is one such company, they are doing a great job, and are including such peripherals as @portis_io, gas station and js libraries. Near will launch first, but they will need to succeed in building a developer community and creating wide token distribution

88/ Eth2 itself is a confusing topic. The project is broken into stages: 0) beacon chain 1) shards 2) smart contracts
There are currently 9? teams working independently on building eth 2 phase 0 clients,

89/ this beacon chain will be the first launch product of eth2 and will give people the opportunity to convert via a burn and mint model. The hope is that eth1 token holders will swap for eth2 tokens

90/ I asked vitalik what happens when eth2 trades on futures markets at lower than eth1, he said they can produce a doc that specs the ability for a 2 way peg. he said once the announce the peg, the price will stabilise

91/ I am impressed with how Vitalik is distancing himself from decision making
Progpow was a controversial addition to eth1, and vitalik has basically stayed out of it

92/ As i said before, he is taking a passive role on many issues. When asked if eth is money, vitalik said “it will be money if they want it to be, but if its not money a DCF model will float the network just fine”

93/ People criticise ethereum that it has unclear governance, lane rage quit because of that, afri got kicked out because of it, i used to think it was bad, but after talking to vlad i realised the point, to make it harder for a group with an agenda to takeover the network

94/ Funny enough, Vlad is adamant that “Eth is not money” yet his insistence against on-chain governance is supportive of the money use case. Maybe he is a master of the art of war

95/ People criticise eth2 by saying that it is underfunded, and too dispersed, meaning its too hard to coordinate all these teams to create a product that works. They are right, that its a very inefficient way to build things.

96/ But if eth2 does come to market and does work, the fact that ETH2 was made by all these teams means that it will be very hard for one of them to unduly influence the direction of the network.

97/ Eth2 is moving from PoW to PoS, PoS is less costly to operate, and more environmentally friendly, because it uses less electricity
People argue that PoW is wasteful, because it burns a lot of electricity in the process of updating the ledger

98/ its true that it uses a lot of electricity, but the benefit is that all network participants know that rewriting the history of blocks will cost real world money, thus making it more difficult to change the ledger

99/ PoS lowers operational costs, which means that the barrier to a profitable network will be lower. PoS has many attack vectors and it is unclear exactly how to overcome them. But we will work on it.

100/ It will take time to make PoS bullet proof by thwarting attacks to raise confidence in PoS to the same level that PoW has today with its 10 year history.

101/ Again, the work of the guys @nervosnetwork has impressed me. They argue that proof of stake may work for layer 2s but that a layer 1 settlement layer must be inherently permissionless, and proof of stake doesnt offer this medium.com/nervosnetwork/…

102/ I asked Vitalik what the miners will do after the PoW ethereum chain is sunset, he said they will most likely migrate to the original ethereum chain ETC. I thought that was interesting.

103/ I believe there is a risk to eth2 that eth1 could be its biggest competitor. Will be interesting to see how this dynamic plays out.

104/ Today Defi is ethereums killer app, and all the eth competitors are trying to figure out how to build their own defi system. We will see DeFi come quickly to other platforms

105/ There are great posts on how D defi products are
hackernoon.com/how-decentrali… In short most DeFi products today have a big red button a central controller can push and shut everything down

106/ @udiWertheimer had a great debate with @koeppelmann from Gnosis, in Berlin, Udi came out on top saying that offshore finance tools powered by bitcoin have the same trust requirements of defi on ethereum today, but with lower platform risk, i think he is right

107/ Udi had the same debate with @yoniassia from eToro in Tel Aviv a few weeks later, and Yoni won the debate, Yoni focused more on the long term vision of defi, which i think is worth going for as a community. Even if we’re not there today, we could get there

108/ @ameensol wrote a great analysis about the kill switch on compound

https://twitter.com/ameensol/status/1169207253347569665?lang=en

109/ @Makerdao, the darling child of eth defi, also has a kill switch
Makerdao issued the mkr token, which is probably a security but thats ok as long as they dont get shut down

110/ The problem with defi today is that they all depend on centralized price oracles
hackernoon.com/a-discussion-o…
No one has really figured out how to make a decentralized oracle

111/ I met @joeykrug from augur in tel aviv, we talked about oracles, we agreed that public chains and oracle parasites will never find a permanent solution, but will be a cat and mouse game like cyber security today.

112/ @joeykrug mentioned that as DEXs get more liquidity, the price oracle issue becomes simpler to solve

113/ Dex’s need to replace centralized exchanges. It’s a blemish on the space that we move around these self sovereign assets through centralized utilities

114/ seriously, A stolen cellphone or sim swap leading to access of funds, is a major security flaw that needs to be fixed markets.businessinsider.com/currencies/new…

115/ Defi has a problem where the updates to the codebases running the various defi services are controlled by centralized organizations, making them not defi but open/stackable finance. The people in control must be trusted to not change the code to something malicious

116/ Because each defi product builds on top of the code of pre-existing defi, it means that a bug anywhere in the stack can mean a complete collapse. MakerDAO just had a bug bounty which could have collapsed DAI, and thus the entire defi movement on ethereum.

117/ Defi today is built to generate yield for people that are already Crypto rich. I asked Lubin and Vitalk how they saw this maturing, ie removing the 150% collateral.

118/ Vitalik said that groups of people with offline trust could collateralize each other as a pool, we are seeing some people start these projects. @AlexMasmej is researching this important area

119/ on one hand we need some KYC to become mainstream, on the other hand we need more privacy. I still cant figure out what to do with my #ENS handle. I dont want you all to know where I spend my money

120/ Defi, or open finance will need to go through a maturation phase which will require some KYC. A lot of people hate KYC in the space, but some solution will streamline it. @OurielOhayon from ZenGo has good thoughts on this

121/ I spent a lot of time with @MatanField from @DaoStack, discussing the value of DAOs
DeFi without mature DAOs seems impossible to me, things like legal DAOs
Openlaw DAO seems like a precursor to this

122/ I Joined @meta_cartel, and think @pet3rpan_ ‘s work to create a community to push forward adoption outside the defi community is a worthy cause. I join the town hall meetings when i can and like the progress we are making. I feel like we are still underfunded

123/ Having a real DAO manage a real DeFi product is an exciting potentiality
A real legal DAO will be able to manage KYC and AML for different regions

124/ Bitcoin will never have KYC because it has no visibility outside of its own chain
Dex’s interacting with btc and crypto can have kyc and that should make most governments happy

125/ I mapped out a few different economic models showing how DAOs could build sustainable business models that fund ongoing network maintenance and development, i'll share those later

126/ Many projects can offer value without a token, it's good to see projects getting funding without the need to superimpose a token prematurely. There may be models to give investors returns with no token whatsoever (like a fee on a lending platform)

127/ Most tokens may end up being deemed securities but the beauty of this space is that it is a place to tinker and at least today there is plenty of rope (sometimes to hang ourselves with)

128/ I think its good that @eos and #kin got in trouble with the #SEC.
I think its good that libra is working to get a green light to become usd coin

129/ The path to awesomeness for ethereum seems clear to me
First, ignore the bitcoin community’s narrative but learn from bitcoin’s success

130/ ETH needs a monetary premium to sustain security levels which will make a robust defi ecosystem feasible. ETH influencers should keep this in mind when pushing off the difficulty bomb

131/ Second, continue the process of central leadership taking a back seat. I asked Vitalik what his plans were after eth2 launches, and he said he had no idea, the question seemed to set him back
Have the EF evolve to some kind of dao with greater transparency

132/ Get some incentivized full nodes running, check out @o_rourke from Pocket and @yanivgraph, they have good ideas how to do this
Figure out a way to make the nodes easier to run by an average person, promote self verification

133/ Figure out a monetary policy and make it a meme
Launch eth 2 with shards and smart contracts and have it work
Fix all the bugs that will come out of PoS

134/ Leverage the btc blockchain to prevent long range attacks, recognize that btc may be more immutable in the short term
Figure out how to utilize IPFS, but not via file coin. Make good incentivications

135/ Make it really easy to build on, advertise, marketing, maybe a Super Bowl commercial? Made with Ethereum stickers? @marketingDAO

136/ Make it easy for other chains to plug into you, Position it like the other chains are your side chain
Want to win like @ameensol said

137/ Know who your competitors are and treat them like competition
i sat in a meeting of eth core devs and magicians and all that la la rainbow stuff is for after you win, now you need to be all like ninjas and t-rex stuff.

138/ Thanks for reading this rant, sorry it was so long. Its been a great year. I’m excited to see what’s up next for Ethereum and the rest of the community! If I didnt mention you im sorry, this took me all day, and i realize now how much i left out. /fin

@mhass33 @La__Cuen did a great job on this write up. the drama that unfolded was noteworthy in how many people were not interested in having a critical conversation on the current state of ethereum.