Quote from: EarnOnVictor on July 29, 2022, 03:09:46 PM

Ethereum as the most actively developed blockchain [...]

It’s not. Bitcoin is; but you obviously are not a developer. I follow Bitcoin Core development, and I am familiar with the codebases of some altcoins; I know first-hand whereof I speak.

Quote from: EarnOnVictor on July 29, 2022, 03:09:46 PM

[...] needs regular upgrades and the introduction of Ethereum merge will help to realize this, and will reduce the present energy consumption by over 99%, and increase sustainability and security within the blockchain as the proof-of-stake mechanism will be the order of the day as it fades off "proof-of-work" system.

Will Ethereum sustain its current bullish trend during and after this merge?

Since you are so very worried about legalities, I am curious to know your opinion of the regulatory risk that Proof-of-Stake will be found to be a securities offering (Axios, 2022-07-27). The Axios article that I thereby linked was sent to me by someone in a discussion I started about this: I think that POS is obviously an illegal unregistered securities scheme, besides being otherwise a reprehensible scam for plutocratic financial mass-manipulation. Since American SEC Chair Gensler is only willing to say that Bitcoin is outside his agency’s jurisdiction (Axios, 2022-06-28), I think the writing is pretty much on the wall: Ethereum is preparing to commit regulatory suicide.

The 27 July Axios article linked above was sparked by a tweet from a law professor, Adam Levitin of Georgetown University:
https://twitter.com/AdamLevitin/status/1550990967670554624

Professor Levitin pretty much just confirmed what I had already been saying:

Quote from: https://nitter.pussthecat.org/AdamLevitin/status/1550990967670554624

Adam Levitin @AdamLevitin
Jul 23

Something no one is talking about: after the Merge, there's will be a strong case that Ether will be a security. The token in any proof of stake system is likely to be a security.

Jul 24
I've gotten some pushback here, so let me elaborate. "Security" includes an "investment contract." "Investment contract" is defined by SCOTUS in Howey as a K for investment in a common enterprise where profits are expected "solely from the efforts" of a third party. 2/

Howey speaks of an investment of "money," but that has always been interpreted just to mean an investment of value. Putting up a stake readily satisfies this element. 3/

The common enterprise element is also readily met with staking: the whole validation system requires multiple parties. That's the pooling (i.e., the more demanding interpretation of common enterprise--horizontal commonality). 4/

The expectation of profit is clear enough too--stakers get rewards. /5

So that brings us to the last element: the profits are expected to be derived "solely from the efforts" of others. In Howey, SCOTUS said "solely" a couple of times. And if that's the measure of things, then staking will not meet the test b/c the staker is also a participant.6/

But lower courts have basically read "solely" out of Howey, at least for things like multi-level distribution pyramids, where participants do have to try to recruit more marks. 7/

Basically Courts of Appeals (2nd, 9th, among others) have read "solely" as being more likely "primarily" or "significantly". And SCOTUS hasn't disagreed. It discussed the issue in a 1975 opinion without taking a position. 8/

Given that what any individual staker contributes relative to the total sum of the efforts in the enterprise is probably quite limited, I suspect the "solely [=primarily] from the efforts" of others element is met. 9/

Now none of this answers the trickier question (imho) of who the "issuer" is when you're dealing with a decentralized system. But that's part of the broader problem of how to fit decentralized systems into a person-based legal system. 10/10

Whenever this argument eventually comes before a judge, I would be very surprised if POS tokens are not found categorically to be securities—both in the United States, and in other jurisdictions around the world. They patently are securities, no matter how POS dupes and shills may try to evade the basic nature of the system. To see what I see, regulators and courts just need some time to catch up with a new nexus of law, technology, and economics.

For my part, I’ll just be holding my Bitcoin, munching popcorn, and saying, I told you so. 😼

Quote from: JeromeTash on July 29, 2022, 09:52:00 PM

How does proof of stake increase security of the Ethereum blockchain as compared to the proof of work, which has pretty much been solid since the inception of the network?

Simple answer: It won’t. I have not-insignificant technical expertise in Byzantine fault-tolerant distributed consensus systems; that is my technical opinion, as well as my experience with both POW and POS:

This is POW: In 2017, a corrupt faction of hostile miners dominated by Jihan Wu/Bitmain maliciously attempted to usurp Bitcoin. Their attacks included both economic attacks (forking Bitcoin), and in November 2017, an attempt to manipulate hashpower and difficulty adjustment to kill off the Bitcoin mainnet. That last was a technical attack on Bitcoin’s POW security—on the POW security mechanism itself. They failed in all attacks.

Quote from: nullius on August 01, 2022, 09:04:14 PM
Quote from: Lauda on June 15, 2017, 02:30:53 PM
I have already stated that the ASIC monopoly and mining cartel are much more dangerous than any kind of scaling issues. Just so that we are clear, all these idiots in altcoins parading "we are the best, we will win next" will get crushed. This is the time to be watching and learning from Bitcoin, i.e. how Bitcoin combats and resists malicious actors such as Bitmain.
This is POS: In May of 2022, a Do Kwon and a colluding cartel of big DPOS companies executed a contentious hardfork of the Terra blockchain, against massive community opposition. POS is a centralized system for the benefit of insider whales, falsely advertised under a thin veneer of fake “decentralization”.

I followed both events closely at the time. All of my theories about POW were empirically proved in 2017. In 2022, I was actually surprised by how easy it was for a group of whales to rule a POS blockchain as an oligarchy: POS is worse than I had thought!

Few Bitcoiners, and almost no altcoiners understand the way that Bitcoin’s Nakamoto Consensus actually works. They therefore are easily misled to believe that POS can replace POW. It can’t. It does not even achieve approximately the same objectives.

Ethereum is already significantly centralized—for instance, its ecosystem is substantially dependent on the central infrastructure of a single service, Infura, which is owned by a U.S.-based company in American jurisdiction, ConsenSys. Ethereum already cannot be compared to Bitcoin’s decentralization. In its consensus system, insofar as I can see, POW Ethereum is already much more centralized than POW Bitcoin. Ethereum’s switch to POS will further consolidate its centralization.

Quote from: EarnOnVictor on July 30, 2022, 04:18:06 PM

I'm not part of the coding team,

Obviously.