I enjoyed a recent post from the visualize value substack:
I had lunch with a real estate investor today.
After my layman explanation of the difference between BTC and ETH, he shot back an analogy:
Bitcoin is digital land that’s appreciating due to its finite supply.
Ethereum is digital land that you can build cash-flowing assets (property) on top of.
the “finite supply” aspect of bitcoin is a necessary part of its success. the rapid adoption of ethereum as a platform for executing smart contracts is a necessary part of its success. while I see bitcoin as the foundation of all crypto now and for the foreseeable future, I don’t share that same belief of ethereum. early mistakes and a broad base of deployment will end up choking forward progress. core concepts of such a computational platform must be implemented in a forward looking way that allows extension and composition. I’m not counting ethereum out, but am currently exploring cardano as a platform for implementing distributed applications.
here I reproduce a list of design principles from the project:
- Separation of accounting and computation into different layers
- Implementation of core components in highly modular functional code
- Small groups of academics and developers competing with peer reviewed research
- Heavy use of interdisciplinary teams including early use of InfoSec experts
- Fast iteration between white papers, implementation and new research required to correct issues discovered during review
- Building in the ability to upgrade post-deployed systems without destroying the network
- Development of a decentralized funding mechanism for future work
- A long-term view on improving the design of cryptocurrencies so they can work on mobile devices with a reasonable and secure user experience
- Bringing stakeholders closer to the operations and maintenance of their cryptocurrency
- Acknowledging the need to account for multiple assets in the same ledger
- Abstracting transactions to include optional metadata in order to better conform to the needs of legacy systems
- Learning from the nearly 1,000 altcoins by embracing features that make sense
- Adopt a standards-driven process inspired by the Internet Engineering Task Force using a dedicated foundation to lock down the final protocol design
- Explore the social elements of commerce
- Find a healthy middle ground for regulators to interact with commerce without compromising some core principles inherited from Bitcoin
aside from the “healthy middle ground” for regulators, that being a potential back door, I’m on board with these ideas. how these ideas are implemented makes all the difference, but this seems like a worthwhile line of inquiry.
if you have thoughts about cardano vs ethereum, cardano vs bitcoin, or any other aspects, connect with me on twitter @plantimals.