This is the final part of a four part post highlighting golden nuggets from "Own The Internet - A Bull Case For Ethereum" on Zerohedge.com authored by Packy McCormick via NotBoring.com (Paraphrase, commentary, embellishments and musings by Boston C!)
According to Packy, there are six big challenges with Ethereum:
"It’s Slow. The Ethereum blockchain currently does somewhere around 19 transactions per second. Visa, for comparison, does about 1,700."
"It’s Expensive. The simplest transaction costs about $5 in gas fees, and when I minted The Great Online Game as an NFT, it cost nearly $1k to mint and auction it."
"It’s Volatile. Gas fees are based on auction, and change all of the time based on demand. That makes it hard to transact with confidence or predictability."
"It’s Inflationary. Unlike Bitcoin, there’s no hard cap on the number of ETH that could theoretically be minted, and Proof of Work requires minting a bunch of new ETH, which means growth leads to dilution for existing ETH holders."
"It’s Environmentally Unfriendly. Mining means using a lot of electricity."
"It’s Inefficient. Most of the money spent on transaction fees leaves the system -- miners are forced to sell the ETH they earn to pay for electricity, hardware, and taxes."
"The fact that Ethereum has seen the adoption it has despite all of those challenges is impressive, but they remain real challenges. When I tweeted an ill-fated tweet asking for reasons not to buy ETH, many of the answers centered around one of the above, most commonly the cost of gas and inflation.
Plus, increased demand for Ethereum-based dApps -- more DeFi, more NFTs, more DAOs, more games -- means more transaction fees, but those fees don’t really accrue to ETH holders. They leak out of the system to cover miners’ real-world, fiat costs in the Proof of Work process.
So today, ETH’s price is based on demand for more ETH, like Bitcoin’s is, and like the dollar’s is. It isn’t tied to revenue, like a company’s is, but it will be soon."
In the meantime, I'm trading into relationships, buying silver, gold and crytpos! Not financial advice!
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