23 votes

The Ethereum Merge is done, opening a new era for the second-biggest blockchain

22 comments

  1. [3]
    AugustusFerdinand
    Link
    I don't know what any of this means (nor do I care) aside from one thing: GPU mining is effectively dead and so GPU prices should be working their way back to sane levels.

    I don't know what any of this means (nor do I care) aside from one thing:

    GPU mining is effectively dead and so GPU prices should be working their way back to sane levels.

    16 votes
    1. [2]
      meatrocket
      Link Parent
      I’ve started to hear some rumblings of Ergo being the next GPU-mining focus. I don’t have data to back that up at the moment, but I think it’s a stretch to think that every miner is just going to...

      I’ve started to hear some rumblings of Ergo being the next GPU-mining focus. I don’t have data to back that up at the moment, but I think it’s a stretch to think that every miner is just going to give up (as much as I might like them to).

      2 votes
      1. Macil
        (edited )
        Link Parent
        Many GPU miners in the short term are going to switch to mining other cryptocurrencies, but most of them will find it unprofitable to continue and will stop. Cryptocurrency mining rewards are...

        Many GPU miners in the short term are going to switch to mining other cryptocurrencies, but most of them will find it unprofitable to continue and will stop.

        Cryptocurrency mining rewards are split between all miners, and will be diluted by more miners joining. The mining rewards are what pay for mining to happen. Out of all mining rewards given by GPU-mineable cryptocurrencies, Ethereum used to contribute 90%, so now there's only enough mining rewards across other cryptocurrencies available to pay for 10% of the previous amount of GPU mining. Most miners that switch over to other cryptocurrencies are going to find their share of the mining rewards are way too low to be profitable and will soon stop mining.

        7 votes
  2. guts
    Link
    The historic upgrade casts aside the miners who had previously driven the blockchain, with promises of massive environmental benefits.

    The historic upgrade casts aside the miners who had previously driven the blockchain, with promises of massive environmental benefits.

    4 votes
  3. [10]
    skybrian
    Link
    I guess it went smoothly? Are there more technically or financially oriented stories about this?

    I guess it went smoothly? Are there more technically or financially oriented stories about this?

    1 vote
    1. [9]
      dubteedub
      Link Parent
      Well the price of Ethereum did drop another 8% today as soon as the "Merge" finished. Its down 20% from one month ago, 42% from 6 months ago, and 60% year to date. I guess this is good that the...

      Well the price of Ethereum did drop another 8% today as soon as the "Merge" finished. Its down 20% from one month ago, 42% from 6 months ago, and 60% year to date.

      I guess this is good that the electronic stickers crew are not wasting the electricity of a medium-sized country now, but I don't really see how this switch to proof of stake makes Ethereum or any other crypto worth the trouble. NFTs thankfully have all but died out and that was the only real driver behind Ethereum in particular that I was aware of.

      So now that this merge has happened, the price is still plummeting and their one major use case is dying. For the crypto enthusiasts, what is there to really look forward to at this point?

      10 votes
      1. Macil
        (edited )
        Link Parent
        People into it for the software / smart contracts / decentralization aren't too worried about the price or NFT popularity. Ethereum existed for most of its life without NFTs and even further than...

        People into it for the software / smart contracts / decentralization aren't too worried about the price or NFT popularity. Ethereum existed for most of its life without NFTs and even further than 60% down from a past peak price. People in the community are very excited that the merge got pulled off, and now the development effort put into the merge can go back to working on sharding, a planned upgrade which will massively expand Ethereum's capacity and significantly lower its congestion-based transaction fees.

        Cryptocurrency speculators looking to get rich from it are probably pretty disappointed with it right now though. I think many traders expected the news of the merge to cause a price rally and planned to sell on the merge to take advantage of that before others did, instead causing a price dip as many rushed to sell before the others.

        8 votes
      2. [7]
        guts
        Link Parent
        Not sure why thankfully and have not died at all.

        NFTs thankfully have all but died out and that was the only real driver behind Ethereum in particular that I was aware of.

        Not sure why thankfully and have not died at all.

        1 vote
        1. [5]
          mat
          Link Parent
          On the plus side, at least the massive environmental damage aspect has been somewhat mitigated, but with that sorted out NFTs "are only valuable as tools for money laundering, tax evasion, and...

          On the plus side, at least the massive environmental damage aspect has been somewhat mitigated, but with that sorted out NFTs "are only valuable as tools for money laundering, tax evasion, and greater fool investment fraud."

          They're a lot more dead than they were nine months ago, and hopefully that trend will continue. Nice idea, in theory, to create unique digital artworks - but the implementation is completely braindead, rendering the whole thing worse than useless.

          13 votes
          1. [2]
            NoblePath
            Link Parent
            There are at least two nft galleries in nyc, for whatever that’s worth.

            There are at least two nft galleries in nyc, for whatever that’s worth.

            1 vote
            1. vord
              Link Parent
              Considering a lot of the traditional art industry is driven by money laundering and tax evasion, I'm not surprised.

              Considering a lot of the traditional art industry is driven by money laundering and tax evasion, I'm not surprised.

              7 votes
          2. [2]
            guts
            Link Parent
            That's like saying FIAT or any technology has been used for money laundering, tax evasion, and investments fraud., therefore those are bad. You are hopeful but the ecosystem and development are...

            NFTs "are only valuable as tools for money laundering, tax evasion, and greater fool investment fraud."

            That's like saying FIAT or any technology has been used for money laundering, tax evasion, and investments fraud., therefore those are bad.

            They're a lot more dead than they were nine months ago, and hopefully, that trend will continue.

            You are hopeful but the ecosystem and development are still high, big companies such as Reddit, Starbucks, and Disney already are in the space.

            create unique digital artworks - but the implementation is completely braindead, rendering the whole thing worse than useless.

            Also wrong on this one, the are more utility cases as permissionless and decentralized membership, digital assets for games and social apps, web3 domains as ENS and Unstoppable Domains, KYC of real humans as Soulbound tokens.

            There are more examples but I do not find it worth it to have a conversation with someone who will always be closed-minded.

            1. skybrian
              Link Parent
              I hope we can avoid pointless discussions about things that supposedly always or never happen, because there are usually exceptions. It's more useful (but is difficult) to try to figure out how...

              I hope we can avoid pointless discussions about things that supposedly always or never happen, because there are usually exceptions. It's more useful (but is difficult) to try to figure out how common they are and how much that's worth.

              4 votes
        2. vord
          Link Parent
          At absolute best, they do not solve a novel problem. Anything an NFT can do a database row in a traditional RDBMS can do better. Even with the lower-energy PoS. The "Non-Fungible" in NFT is a lie....

          At absolute best, they do not solve a novel problem. Anything an NFT can do a database row in a traditional RDBMS can do better. Even with the lower-energy PoS.

          The "Non-Fungible" in NFT is a lie.

          Crypto as a whole sucks at the actual problem it's intended to solve... providing digital currency. Between high volatility and high transaction costs, it's useless for everyday use.

          8 votes
  4. [5]
    Akir
    Link
    Just because it's unexamined doesn't mean that it's not problematic. It was my understanding that Proof of Stake was originally supposed to rely on having a lot of storage available; is that not...

    “Proof-of-stake is like running an app on your MacBook,” he said. “It's like running Slack. It's like running Google Chrome or running Netflix. Obviously, your MacBook plugs into the wall and uses electricity to run. But no one thinks about the environmental impact of running Slack, right?”

    Just because it's unexamined doesn't mean that it's not problematic.

    It was my understanding that Proof of Stake was originally supposed to rely on having a lot of storage available; is that not the implementation that Etherium decided on? It's good if that's the case, but if more storage is a requirement then that's just another issue that is left unexamined.

    While I do think this is a great thing - to have the people running Etherium finally put their money where their mouth is - it's basically just the equivalent of tightening a screw on a falling blimp when it comes to crypto in general. Miners who were previously investing in Etherium are just going to put their equipment to mining altcoins like everyone else is doing.

    1 vote
    1. [3]
      stu2b50
      Link Parent
      I think you're probably thinking of Chia or other PoW schemes where the "work" was changed to be less energy intensive. How Proof of Stake works is that holding Ethereum increases your chances...

      It was my understanding that Proof of Stake was originally supposed to rely on having a lot of storage available;

      I think you're probably thinking of Chia or other PoW schemes where the "work" was changed to be less energy intensive.

      How Proof of Stake works is that holding Ethereum increases your chances (e.g if you have 64 Ethereum you have 2x the chance of being a validator as someone with 32 Ethereum) of randomly being chosen to be a validator (a general in BFT, effectively). The randomly chosen validators for a new block then basically just run Byzantium Fault Tolerance at this point, and the validators are rewarded with Ethereum.

      The bigger problem with PoS is that it's not as clear that it actually works as a consensus mechanism that's resistant to attack. For all the ills of PoW, it certainly and fairly simply accomplishes the goal of making bad actor attacks very expensive. I suppose we shall see if PoS has what it takes - Ethereum will be a big target for sure.

      7 votes
      1. Macil
        Link Parent
        In PoW, if you use your mining rigs to attempt a double-spend attack, you can go right back to profitably mining or attempting more attacks with them right after. In PoS, attempting a double-spend...

        The bigger problem with PoS is that it's not as clear that it actually works as a consensus mechanism that's resistant to attack. For all the ills of PoW, it certainly and fairly simply accomplishes the goal of making bad actor attacks very expensive.

        In PoW, if you use your mining rigs to attempt a double-spend attack, you can go right back to profitably mining or attempting more attacks with them right after. In PoS, attempting a double-spend attack gets your entire stake slashed preventing you from attempting more attacks or going back to validating, significantly raising the costs of attacks. PoS has multiple properties like this and finality that give it certain security properties that are stronger than PoW does. It's true that PoS is much more complicated than PoW and has a higher risk of a design or implementation defect existing, but PoS systems like Ethereum's have been live for years in other busy blockchains, and the software engineering that went into Ethereum's implementation has been incredibly meticulous, with multiple interoperable implementations developed to a standard and all heavily tested together.

        4 votes
      2. petrichor
        Link Parent
        Indeed, and being not particularly involved in the cryptocurrency world, I'm content to sit back and observe from afar. Proof of Stake is significantly more complicated than Proof of Work, and...

        The bigger problem with PoS is that it's not as clear that it actually works as a consensus mechanism that's resistant to attack. For all the ills of PoW, it certainly and fairly simply accomplishes the goal of making bad actor attacks very expensive. I suppose we shall see if PoS has what it takes - Ethereum will be a big target for sure.

        Indeed, and being not particularly involved in the cryptocurrency world, I'm content to sit back and observe from afar. Proof of Stake is significantly more complicated than Proof of Work, and complexity breeds risk.

        I'm really curious about how robust their randomness measure in particular will hold up to be.

        1 vote
    2. Macil
      (edited )
      Link Parent
      You're thinking of Chia's Proof of Space, an alternative consensus mechanism to Proof of Stake and Proof of Work. Chia's Proof of Space does significantly improve on the energy usage of Proof of...

      It was my understanding that Proof of Stake was originally supposed to rely on having a lot of storage available;

      You're thinking of Chia's Proof of Space, an alternative consensus mechanism to Proof of Stake and Proof of Work. Chia's Proof of Space does significantly improve on the energy usage of Proof of Work, but it still has e-waste issues and is believed to have run up hard drive costs for a while as Chia miners bought them up. Proof of Stake as used by Ethereum is much better than either of these as it does away with both the energy and e-waste externalities of the others, as it only incentivizes validators to compete with each other through staked currency within the system rather than any external real-world resources.

      3 votes
  5. [3]
    streblo
    Link
    Anyone know the expected ROI on staking? Is this something that could be a drain on defi investments? Also, why is there a minimum stake if it's essentially a weight-based lotto anyways?

    Anyone know the expected ROI on staking? Is this something that could be a drain on defi investments?

    Also, why is there a minimum stake if it's essentially a weight-based lotto anyways?

    1. Macil
      (edited )
      Link Parent
      I'm not sure what the ROI on staking is presently, but it does go down the more people that join, so I expect people to join in continuously until the expected returns are a low percent similar to...

      I'm not sure what the ROI on staking is presently, but it does go down the more people that join, so I expect people to join in continuously until the expected returns are a low percent similar to other common investments.

      There are staking pools that let people with less than the minimum stake participate and get returns.

      2 votes
    2. skybrian
      (edited )
      Link Parent
      I believe the minimum stake is because the distributed consensus algorithm only scales up so far. It limits the number of direct participants.

      I believe the minimum stake is because the distributed consensus algorithm only scales up so far. It limits the number of direct participants.