Crypto and religion have a bit in common.
In the book Sapiens by Yuval Noah Harari, Harari outlines a natural limitation of direct relationships and gossip to form bands.
In the wake of the Cognitive Revolution, gossip helped Homo sapiens to form larger and more stable bands. But even gossip has its limits. Sociological research has shown that the maximum ‘natural’ size of a group bonded by gossip is about 150 individuals. …
Ethereum is a global, decentralized settlement layer for value on the internet.
Today, code is live on Ethereum for various “money legos” for borrowing, lending, investing, saving, trading… the DeFi stack is forming, but users are few.
The development to date has been propped up by a variety of investments, including:
Decentralized finance today is primarily on top of Ethereum and has many cooperating, stacked components:
Smart contracts enable new assets, and new assets may soon act as collateral to enable yet further new assets, all enabled by the underlying core consensus protocol.
So, 2) and 3) rely on 1), and therefore cannot achieve decentralization that is greater than that of 1). Said otherwise, since 1) sets the foundation layer for 2) and 3) to be built on, 1) also sets a theoretical maximum level of decentralization 2) and 3) can achieve / maintain.
While some assets and protocols are built on top of Ethereum with Ethereum’s core tenets in mind, others may not be. …
As a follower and supporter of the Ethereum project, I always support healthy conversation around network developments and upgrades. The goal with this article is to surface a thoughtful discussion about the economic merits and challenges of the current Ethereum 2.0 ether migration design with an approach of a one-way bridge.
In my view, Ethereum’s story is equal parts technology, and equal parts finance, and with the migration to Ethereum 2.0 approaching, it is important to consider both technical and economic challenges together, and with equal scrutiny.
From a technical standpoint, the viability of a one-way bridge versus a two-way bridge is well represented and articulated; however, the discussion around the strengths and challenges of the economic design for the migration are currently underrepresented in the discussion, and deliberation over the economic aspects of a one-way migration has been limited so far. …