Author Topic: Vitalik want's to dilute Ethereum more! You are welcome to make our mistakes!  (Read 5461 times)

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Offline Akado

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Same movie, different characters. That's actually nice for whoever paid attention to BTS this year and learned from it. Imagine knowing what would have happened to BTS in the past year? If Ethereum plays out like BitShares did, we will be having dejavus for a year and profit the most. If. Depends on how they handle the situation.
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Offline Ander

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News that they are switching from paying miners to paying developers would be seen as a POSITIVE by the market for Ethereum. 

It wont.  The market was planning on 0% inflation proof of stake coming in a year.  You could look forward to that conversion date as the end of the inflation.   Now they have to expect the current mining phase to be followed by future inflation as well even after proof of stake.  The change is for the inflation to last longer, which the market hates.

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All this proves is that our THINKING is still over 1 year ahead of ethereum.   This time next year they will be discussing the need to completely re architect their system because it is constrained by performance and the fees are so high that people are switching to other platforms (such as ours :) )

Yes!

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1 year ago our financial situation looked something like theirs:

Yes!

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Ethereum is a great project with a great following that shouldn't be underestimated.   I really hope they can learn from our mistakes rather than repeat them.   Astute traders can probably learn from this pattern and predict where they will be in 6 months.

Its great, but I hope they repeat our mistakes.  I want to buy the absurdly cheap ETH later.
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Offline bytemaster

This is just V's opinion and an enumeration of OPTIONS.     

26% inflation from miners represents $1M per month in net SELL pressure on ETH.   Imagine what the BTS price would be if we were paying miners anything close to that!!

News that they are switching from paying miners to paying developers would be seen as a POSITIVE by the market for Ethereum.    BitShares went from NO inflation to 2% inflation and all hell broke lose.  Even with vesting balances BTS inflation is only 10% and falling.

All this proves is that our THINKING is still over 1 year ahead of ethereum.   This time next year they will be discussing the need to completely re architect their system because it is constrained by performance and the fees are so high that people are switching to other platforms (such as ours :) )

1 year ago our financial situation looked something like theirs:

1000 BTC in the, a couple hundred thousand USD, and 80M BTS worth $0.03 each and 3 million in capital losses.    In dollar terms, our war-chest was a similar size a year ago to what theirs is today.   Then BTS fell in value (along with BTC) and what we thought was a 1+ year runway (or infinite with delegate pay) ran out in just 6 months while we were forced to sell BTS at the low just to pay taxes.

They will probably make the same mistake we did in over-estimating our financial runway.   We assumed that BTS prices would stay near 50M and that delegate pay would be sufficient.   What happens to their runway when ETH falls to 25M.  What happens to their developers when their burn rate is cut to $50,000 per month or less?    They probably aren't even factoring in the tax consequences of directing future mining rewards to the foundation. 

Ethereum is a great project with a great following that shouldn't be underestimated.   I really hope they can learn from our mistakes rather than repeat them.   Astute traders can probably learn from this pattern and predict where they will be in 6 months.
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Offline Ander

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Ethereum is going to go through what we went through for the past year.  Lucky for them they can look at exactly what happened to BTS and know exactly what is coming for ETH.  It will go exactly the same.  We were so nice as to give them a sneak preview ahead of time, now they should know that they can just dump now and buy later.

When the price is half or less of the IPO price it will be buy time.  12-15 cents per ETH or so.
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Offline btswildpig

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" In any case, our original promise that the issuance rate will not exceed 26.00% per year, and the goal that the eventual final issuance will be much lower (likely 0-3% per year) with proof of stake, will both be kept "

So , the dilution rate would still the same and wound't dilute "more" . The only difference here is where the diluted funds would be directed .
这个是私人账号,表达的一切言论均不代表任何团队和任何人。This is my personal account , anything I said with this account will be my opinion alone and has nothing to do with any group.

Offline Empirical1.2

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They say

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In any case, our original promise that the issuance rate will not exceed 26.00% per year, and the goal that the eventual final issuance will be much lower (likely 0-3% per year) with proof of stake, will both be kept.

I don't follow ETH that much but if the possibility that ETH could be diluted at varying rates up to 26% per year has been there from the start, the blowback won't be nearly as bad as for BTSX which was perceived as being a no dilution crypto-currency by the majority of the market at the time. 

Where they will definitely struggle though is that there is a significant time gap between when you pay for development and when that development starts generating significant income or bringing in new users to offset the cost.

So if they do start pushing the high end of the 26% dilution rate their price will suffer especially if ETH demand drops a lot during the interim waiting period like BTS's did.
« Last Edit: September 28, 2015, 07:31:03 pm by Empirical1.2 »
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Offline btswildpig

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I think wanting dilution is nothing wrong .
Excuting it disregard of the community and market's reaction would be .

The key is whether he can go through with it in days .  And I think we all know the answer to that . He can not even if he wants to .

So , I don't know why you guys are all this excited .....
这个是私人账号,表达的一切言论均不代表任何团队和任何人。This is my personal account , anything I said with this account will be my opinion alone and has nothing to do with any group.

Offline Akado

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That's actually awesome news if you can buy bellow IPO price! However like bitcoinsatan mentioned, you don't know how people will react, even though I'm more inclined to see a dump as soon as few people start to spread the word "dilution" around.

As long as Vitalik acknowledges DPOS it's already a victory for us. It means it's adopting our system that got so criticized in the past by other people who might be Ethereum followes. It might even give us more credibility since Ethereum has a fan base bigger than ours. So as long as we get good in the picture and we can make a few articles off of it I'm all fine.

Just get an article "How Ethereum adopted BitShares' DPOS" out and I'm good with it.
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Offline BunkerChainLabs-DataSecurityNode

They're not just copying our dilution, but DPOS.  Watch the price jump as their actions are considered revolutionary and cool by the market.

It's not what you do, but how you do it - marketing

https://bitcointalk.org/index.php?topic=1195487.msg12546317#msg12546317

Do they have any monetization plan?

"Another action that may be taken is, when Ethereum switches to proof of stake, keeping 50% of the old issuance rate active for a year and directing the issuance into some kind of mechanism, perhaps a simple voting scheme or perhaps something more complex incorporating delegated voting, decision markets and potentially other revealed-preference tricks from game theory, in order to pay developers."

Actually, then that would be a DPOS or Delegated POS.

Vitalik announces DPOS dilution...

and the crowd goes wild!!

https://www.reddit.com/r/ethereum/comments/3mpq6b/new_ethereum_blog_post_from_vitalik_buterin_the/

The title of that thread you linked to is:    

Vitalik writes Dear John letter to the Ethereum community...

Is that really how everyone else interprets it?

It sounds like ethereum is about to go poof.
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Offline Empirical1.2

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Prepare to see ethereum price go to the bottom the next months like it did with bts after dilution was announced!

"Another action that may be taken is, when Ethereum switches to proof of stake, keeping 50% of the old issuance rate active for a year and directing the issuance into some kind of mechanism, perhaps a simple voting scheme or perhaps something more complex incorporating delegated voting, decision markets and potentially other revealed-preference tricks from game theory, in order to pay developers. In any case, our original promise that the issuance rate will not exceed 26.00% per year, and the goal that the eventual final issuance will be much lower (likely 0-3% per year) with proof of stake, will both be kept. We highly welcome community input on whether and how to go down this path; if there is large opposition we will not do this, though the community should understand that NOT doing this comes with a risk of greater reliance on the for-profit ethereum ecosystem."
https://blog.ethereum.org/2015/09/28/the-evolution-of-ethereum/

PS  Tip of the day/weeks/months to come: margin sell ETH, margin buy BTS ;)

 +5% ETH will crash

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Offline liondani

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Prepare to see ethereum price go to the bottom the next months like it did with bts after dilution was announced!

"Another action that may be taken is, when Ethereum switches to proof of stake, keeping 50% of the old issuance rate active for a year and directing the issuance into some kind of mechanism, perhaps a simple voting scheme or perhaps something more complex incorporating delegated voting, decision markets and potentially other revealed-preference tricks from game theory, in order to pay developers. In any case, our original promise that the issuance rate will not exceed 26.00% per year, and the goal that the eventual final issuance will be much lower (likely 0-3% per year) with proof of stake, will both be kept. We highly welcome community input on whether and how to go down this path; if there is large opposition we will not do this, though the community should understand that NOT doing this comes with a risk of greater reliance on the for-profit ethereum ecosystem."
https://blog.ethereum.org/2015/09/28/the-evolution-of-ethereum/

PS  Tip of the day/weeks/months to come: margin sell ETH, margin buy BTS ;)