The Eye Opening Truth About Ethereum | Michael Saylor

The Eye Opening Truth About Ethereum | Michael Saylor

‘I think that the rest of crypto takes a shortcut right now. The shortcut is issuing unregistered security. There really isn’t an example that I can think of any kind of smart contract network or proof-of-stake or crypto trading network that competes with bitcoin that didn’t take the shortcut of an unregistered security. They’re not decentralized.

Ether rallied by over 40% from $1,000 on July 13 to over $1,400 on July 16. The jump appeared partly due to euphoria surrounding “the Merge” slated for September. At the time of writing, Ethereum is trading at $1,405. The uptick has caused mixed reactions in the short term. Some traders are optimistic about Ethereum’s outlook due to the golden cross’s appearance on the four-hour chart.

On the contrary, analysts believe that this 40% rally is fake out and a 45% crash is on the horizon. If you still don’t know what to do with your Ethereum, Jet-Bot, one of the best crypto trading bots, got 100% rating at CoinPayments website according to 7000+ users feedbacks. The platform is official broker of the Binance exchange. Copy best traders automatically to earn up to 2000% APY on Jet-Bot copy trading platform. There is wide range of strategies and indicators to build your perfect bot.

While analysts disagree on the short-term outlook, in the long term, Michael Saylor made his thoughts known on why to stay clear from Ethereum. As a guest on the ‘Not Investment Advice’ podcast, Saylor went into detail on why he is against Ethereum in the long-term. Ultimately, Saylor’s disdain for Ethereum is because, at the end of the day, he doesn’t clearly understand who is making the final decisions for Ethereum.

The Eye Opening Truth About Ethereum photo

‘The issue with ETH is that if you want a decentralized network, you have to actually install a protocol and it has to run unmolested, you know, unmodified for 5 to 10 years before you can conclude that it is decentralized and censorship resistant, and ETH hasn’t even gotten there yet. The clock on ETH won’t start until after the problem with ETH is fixed.

They’ve still left all sorts of questions. What’s the issuance schedule going to be for the next thousand years? You know what? You know what the staking rules are? What are the odds that there is so much? There’s such an ambitious technology agenda that the protocol never stops mutating. The problem with an ever-mutating DNA structure is that it usually results in a monstrosity. For obvious reasons, you can’t keep mutating the protocol, so ETH isn’t really something that you can have an opinion on yet because they haven’t stopped mutating it.

If you had to have an opinion on what I see in front of me, what you see is that this is something that was sold as an ICO to the public by the Ethereum foundation. The Ethereum foundation controls it. It’s an investment contract. It’s been hard multiple times, and the hard forks aren’t just hard forks to fix the fatal bug, they’re hard forks to change the underlying monetary protocol, and the protocol keeps materially changing and it is never stabilized. Right now you’ve got an ETH mining constituency, and every year for the past five years they’ve had difficulty destroying it. Well, if they keep putting it off, well, the miners don’t want to destroy themselves. Who’s controlling the network? Not the miners, right?

There’s a small group of developers that control what the network is, and that’s a company. It’s a software company, and ETH is an equity. They’ve sold it to the general public and they keep changing the protocol. Hard forks are just software upgrades that are mandatory, so it’s not a decentralized network, it’s not a commodity. There’s no reasonable person that understands the law or ethics that could conclude that Ethereum is a commodity. You can’t. Gary Gensler doesn’t think it’s a commodity. You can read his videos on it.

Does it pass the Howie test as an investment contract? The question you’ve got to ask yourself is who makes the decisions and what’s the basis on which they make them. It doesn’t help to vote on these things either. By the way, if you vote on them, companies vote on things if the shareholders get a vote. That makes it a security.

The only way to establish a commodity in cyberspace is for someone to follow Satoshi’s example. The example is that you create the software, give it to the world with no economic motive, and the protocol is set forever. No one changes it. So if you’re going to change it, you could justify fixing a bug, but if someone hard forked bitcoin to be 42 million coins instead of 21 million coins, or they hard forked it to change the issue and schedule, all of a sudden you’ve centralized it, you reset the clock. It looks like something which is controlled by an entity. You have to wait a decade to figure out whether or not it’s stabilized. I think the real issue with ETH is that a decade after they finish changing it and screwing with it, you can have an opinion on it. But it doesn’t look to me like they’ll stop hard forking it for the next three years, like the plan is to keep hard forking and hard forking.

I’ll give you a question. When you stake your ETH, okay, well what’s the yield schedule on the stETH for the next decade and then when can you get your stETH out?’

What do you think of Sailor’s thoughts here? Do you think that he’s accurate about Ethereum or is he being too close-minded?

 [This article is a transcription of a video made by Only The SAVVY]

[Original video:]