Can Ethereum (ETH) Scale in Time to Be Relevant?
YouTube’s The Crypto Lark just hosted a round table with Crypto Zombie, Crypto Spark and Kevin from Bitcoin for Beginners to tackle some of the big questions facing crypto analysts and enthusiasts. He starts with Ethereum, which recently bounced off an all-time low for the year at $183, according to WorldCoinIndex. It’s currently trading at $222, at time of writing, after a quick rebound, but the huge slide has left investors and adopters questioning its fundamentals.
Two theories about Ethereum have emerged. It’s either the victim of its own network popularity for the ICO market, providing the blockchain onramp for over 1,500 projects that have raised capital and built financing platforms through ERC20 tokens, or there are valid and critical concerns about Ethereum’s ability to scale and grow.
In the scenario where Ethereum does scale and is successful, there’s still the possibility that ether (ETH), the native cryptocurrency, becomes worthless. A recent article in TechCrunch goes so far as to call it a done deal because “there is no hard requirement for Gas in an Ethereum contract.”
But Vitalik Buterin, co-founder of Ethereum, offers his rebuttal.
“There is a clear benefit to using ETH to pay for Ethereum in the protocol as it stands today: paying for gas with ETH is built-in and has no gas cost of its own, so there is no “tax tax”. Paying for gas in any other token does not have this advantage. Also, ETH is the only medium of exchange on Ethereum where the gas cost of transactions is 21000, and not ~40000.”
Kevin from Bitcoin and Beginners believes that the release of the network’s scaling and performance solutions, namely Casper, Plasma and sharding, will quell a lot of the criticisms. Making ETH clearly indispensable for all the decentralized applications on the network would also increase its value and utility.
Crypto Zombie says you have to think about how robust the Ethereum ecosystem is right now and how much time and development has gone into the network. “I actually think Ethereum is going to be all right.” But he does question the timeline and the possibility that the developers may need two years to implement the upgrades, which he calls a lifetime in crypto.
Kevin sees an upside to patience, as it gives the Ethereum developers enough time to test their code and make sure it’s sound and secure against backdoor hacking.
Crypto Spark points out that the crypto community is in unchartered waters with no real idea of what could happen if there was some insurmountable problem with the Ethereum network, which hosts so many projects. But he remains positive because of the enthusiasm and talent Ethereum has generated and attracted. He dismisses the wave of negative press Ethereum has generated over the past three months.
Crypto Lark picked up on Spark’s point on the negative press, and notes that market manipulation can extend into the media with articles promoting FUD to influence Ethereum’s price.