PP Cincinnati Reds HB Baseball Fan Boots 038D 48SBz8W
I read a Techcrunch story this morning that makes strong claims regarding inevitability of ETH collapse. Some thoughts on why I am not convinced by the arguments in the article follow.
tl;dr ETH could very well end up being worthless but it won’t be for the reasons claimed in the article.
Baseball Fan Reds 038D Cincinnati HB PP Boots Is ETH needed for Gas?
The crux of the argument is as follows: suppose ETH ecosystem births forth a coin called BuzzworldCoin, which reflects pricing of a real world meaningful digital resource in a popular application. The question is, what is the optimal currency for gas payments so that BuzzworldCoin transactions can go through? if the optimal currency is BuzzworldCoin itself, the argument goes, then ETH isn’t really needed for anything and so it has no real value.
Transaction Costs Matter
But why should BuzzworldCoin be the optimal currency for such payments? What miners, which are real world businesses, want is hard currency, such as EUR or USD. If you are a bitcoin maximalist, perhaps, BTC, which doesn’t change the argument. Therefore, if they get paid gas fees in an app token, they will immediately try to convert the app token to a hard currency either via a public exchange, or a direct trading relationship with a market maker.
Since there exist established ETH/EUR, ETH/GBP, ETH/USD and ETH/BTC markets, it is very likely that a market for converting any one app token to a hard currency will be wider ( in terms of bid/ask spread ) and shallower ( in terms of available liquidity ) than the currently existing ETH markets.
The Lowest Transaction Cost Currency Is the Best Gas
Therefore, all things being equal, a miner will prefer to get paid gas fees in either USD/EUR/BTC or ETH, because doing so will incur lowest possible overall transactions costs, relative to getting paid in app tokens.
It’s clearly inconvenient for users to have to get ETH and make an additional gas payment explicitly in order to use some other app which doesn’t really use ETH. This is, however a UX concern, not a fundamental concern about ETH value. I agree that a horrible user interface is something that ultimately can kill the ecosystem and this issue needs to be addressed for crypto as a whole to grow.
What Can Send ETH to Zero ?
Fan Cincinnati Baseball HB PP 038D Boots Reds Rather than concern about which currency to pay gas costs in, the primary risk factor that can send ETH to zero is ultimately lack of BuzzworldCoin-like killer apps. The promise of ETH as a world smart contract computer needs to be fulfilled eventually for ETH to have long term value. To that end, scalability and POS solution coming online at some point soon is critical.
Read more on this from sizes Shoes Collector Horses Trainers amp; Sneakers ladies Running Men's Kids zfxwx1q7B: