Way too many bitcoiners are not paying attention to the two serious crises playing out in ETH just weeks away from the merge.
Both have implications for bitcoin & its future.
Instead of saying "we told you so" or ignoring what's going on, let’s go through both individually 🧵
Both have implications for bitcoin & its future.
Instead of saying "we told you so" or ignoring what's going on, let’s go through both individually 🧵
1st issue:
ETH miners are contentiously preserving the PoW chain.
Bc DeFi & stables are integral to ETH's value prop, issuers like USDC essentially select which chain wins & which collapses.
Scary that future forks live or die based on a US company.
ETH miners are contentiously preserving the PoW chain.
Bc DeFi & stables are integral to ETH's value prop, issuers like USDC essentially select which chain wins & which collapses.
Scary that future forks live or die based on a US company.
https://twitter.com/ameensol/status/1465378459157295107
2nd issue:
Fall out from the Tornado sanctioning & the realization that ~70% of validators are US-based, regulated custodians that have to comply with OFAC.
This introduces the real possibility of base-layer protocol censorship being introduced on ETH.
Fall out from the Tornado sanctioning & the realization that ~70% of validators are US-based, regulated custodians that have to comply with OFAC.
This introduces the real possibility of base-layer protocol censorship being introduced on ETH.
https://twitter.com/TheEylon/status/1558911348255461378
I legit can’t believe there wasn’t a real plan for either situation & they werent actively anticipated.
How were these possibilities not primary concerns until the recent sanctions?
Not postponing the merge until there's less uncertainty is insane to me.
How were these possibilities not primary concerns until the recent sanctions?
Not postponing the merge until there's less uncertainty is insane to me.
https://twitter.com/ercwl/status/1559271285464748035
While separate & concurrent issues, their overlap actually points towards a worse case scenario world which should be prepared for.
I ask these questions to reduce any future possibility of BTC capture and to highlight impt differences between PoS & PoW.
I ask these questions to reduce any future possibility of BTC capture and to highlight impt differences between PoS & PoW.
https://twitter.com/milessuter/status/1559918850455511040
Issue 1 eliminates the viability of any potential fork of the network. If entities beholden to regulators now play kingmaker on which chain lives - that's permissioned.
The PoW fork is annoying but the real concern is being forced to become OFAC-chain.
The PoW fork is annoying but the real concern is being forced to become OFAC-chain.
https://twitter.com/ameensol/status/1558523768477138944
Issue 2 shows how PoS, as it currently stands, has a majority of stake that's subject to complying with blacklists - having the validity of certain types of transaction dictated by the regulatory regimes.
Hardly a "unstoppable world computer.'
Hardly a "unstoppable world computer.'
https://twitter.com/milessuter/status/1559358148158291969
While not a single Wall St person was jailed when massive fraud collapsed our economy in '08, and HSBC just gets fined for laundering 🇲🇽 cartel money…
OFAC violations explicitly state that Officers at the company could serve jail time for non-compliance
OFAC violations explicitly state that Officers at the company could serve jail time for non-compliance
https://twitter.com/milessuter/status/1559554438519525377
Sanctions are only going to increase.
Due to its design PoS makes sanctions poisonous for all parties involved. It's obviously the case.
PoW is clearly *fundamentally* different.
Conflating the two is intellectually dishonest but no doubt they will try.
Due to its design PoS makes sanctions poisonous for all parties involved. It's obviously the case.
PoW is clearly *fundamentally* different.
Conflating the two is intellectually dishonest but no doubt they will try.
https://twitter.com/milessuter/status/1560047832052162561
I really dont see any non self-contradictory option for these US regulated staking services outside of shutting down.
OFAC deciding not to come at MTL-holding regulated US entities helping to produce violating blocks is wishful optimism vs a real plan imo
OFAC deciding not to come at MTL-holding regulated US entities helping to produce violating blocks is wishful optimism vs a real plan imo
https://twitter.com/brian_armstrong/status/1560016827253551104
The community is preparing to potentially not even risk it and instead fork off all of the regulated staking services.
https://twitter.com/lrettig/status/1559722364191088642?s=20&t=LaZJnsQV1Z6wx-NV2LiiHQ
Which brings us back to Issue 1 and the danger of USDC/Circle/Tether being able to dictate which chain is valid.
It dictates where this massive amount of USD tokens actually resides.
The chain retains redeemability has massive impact on which survives.
It dictates where this massive amount of USD tokens actually resides.
The chain retains redeemability has massive impact on which survives.
https://twitter.com/ercwl/status/1558370453978320896
Most recent replies from bitcoiners have completely missed the point, lacking substantive context here
We should pay attention instead of indulging in surface level schadenfreude; to actively anticipate threats so we avoid waking up in a similar situation
We should pay attention instead of indulging in surface level schadenfreude; to actively anticipate threats so we avoid waking up in a similar situation
https://twitter.com/milessuter/status/1558813535056134144
Some takeaways:
Stratum v2 is urgently needed to give optionality to PoW miners.
Bitcoin needs to be vigilant to never limit the all-important ability to fork freely.
Regulated entities subject to US financial regulations won't flaunt OFAC when it comes down to it. They can't.
Stratum v2 is urgently needed to give optionality to PoW miners.
Bitcoin needs to be vigilant to never limit the all-important ability to fork freely.
Regulated entities subject to US financial regulations won't flaunt OFAC when it comes down to it. They can't.
Switching to PoS next month w so much uncertainty is just crazy to me.
If OFAC immediately after the transition to PoS insists to these institutions that they must censor txs or else be deemed to be in violation of sanctions, then chaos will ensue.
If OFAC immediately after the transition to PoS insists to these institutions that they must censor txs or else be deemed to be in violation of sanctions, then chaos will ensue.
https://twitter.com/milessuter/status/1558834221304643584
How is this somehow a surprise & just recently become an emergency for the community to address mere weeks away from the point of no return?
I haven't heard a good answer tbh.
But bitcoin should absorb lessons to become more resilient while others "move fast and break things"🍿
I haven't heard a good answer tbh.
But bitcoin should absorb lessons to become more resilient while others "move fast and break things"🍿
I've said it in the past, but Lyn nails it here:
https://twitter.com/LynAldenContact/status/1560077123183853568
I spend 2% of my time on ETH yet it couldnt have been clearer that this was a possibility
6+ years of planning for PoS and this, like, didn't come up?
I'd just assumed it was a given & that smart technical solutions had been baked in…but apparently not?
6+ years of planning for PoS and this, like, didn't come up?
I'd just assumed it was a given & that smart technical solutions had been baked in…but apparently not?
https://twitter.com/milessuter/status/1452992611707412498
Did you forget to wargame, Anon?
https://twitter.com/milessuter/status/1441026256431054854
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