In this video, I discuss Ethereum's poor performance since the September 2022 merge, and some reasons behind it.
One of the worst things about Ethereum is this:
The whole system is set up to maximize rent-seeking by large ETH holders and beneficiaries of the huge premine/presale. Most Ethereum sheep don't even realize this.
Ethereum extracts money from its users/transactors and gives that money to large Ethereum stakers (the more Ethereum you own and stake, the higher the probability that you will get to win the next block).
How does this work? When you make an Ethereum transaction, you pay a base fee and a priority fee (tip) to the validators (i.e. people who have staked their ETH).
Unlike in BTC, in ETH you even pay this fee whether or not your transaction goes through.
The base fee is burned (EIP 1559), thus decreasing the overall supply of ETH and helping ETH stakers/validators. ETH stakers/validators keep the priority fee/tip, thus getting even richer.
Do you see what is happening? The entire system is set up to rent-seek off of transactors, in order to benefit holders. Kinda reminds you of the endless tolls and fees in the traditional fiat system that enrich banks and payment processors.
Summary:
Users get financially penalized for using the network, while holders/stakers of ETH get rewarded.
Not investment advice! Consult a financial advisor.
I am not being paid or otherwise compensated by any company or cryptocurrency project that I mention in my videos. My opinion is not for sale. Please do not contact me with any affiliate or advertising deals.
#Ethereum #Bitcoin
Disclaimer Neither Bitcoin University, nor any of its directors, officers, shareholders, personnel, representatives, agents, or independent contractors (collectively, the “Operator Parties”) are licensed financial advisors, registered investment advisors, or registered broker-dealers. None of the Operator Parties are providing investment, financial, legal, or tax advice, and nothing in this video, on this YouTube channel, or at www.Trader.University or www.BitcoinUniversity.com (henceforth, “the Sites”) should be construed as such by you. This video, channel, and the Sites should be used as educational tools only and are not replacements for professional investment advice. Trading or investing in new and volatile assets like Bitcoin can be risky.
