Chat 5: Chats with a New Etherean

Transcript

foreign [Music] so I think as long as I uh make space by deleting the previous one that I edit and post up there should be room for a new one you hear me okay yeah it's my stupid camera it's all good I'm gonna go ahead and get some coffee so I don't have to get up and caffeinate in the middle of things um what was I thinking oh I assume you can hear me um yes I can hear you cool I think so you posted this to yesterday's chat

to your channel I don't think it's great to fragment it so you're welcome to have them all on your channel but I could also give you publishing rights to each Staker and you could publish them there if you want um okay we have uh we have a broader reach and so yeah I agree uh I just didn't know what else to do I didn't and I just didn't like I said there's a lot of links in the chain with sending it to me me doing it me sending it back and I was just trying to streamline things a little bit but uh yeah I don't uh I don't mind uh publishing it to your Channel at all yeah because as I looked at it I'm like wait in a way we kind of lost one is following the series is like now

switching to a different channel to catch that that episode um well you want me to re -upload it with those publishing rights secretly I don't care you do whatever you want like well there's no my phone isn't chatting I don't so I'm cool with sustaining any momentum that uh we may have been acquiring so the funny thing about me and medium media like I don't worry too much about where it goes um like if it's out there then I think it's eventually going to connect to the right people um but in terms of like this series I do think continuity would be beneficial

yeah I agree uh uh but often when things are in their formative stage there's a little bit of uh shuffling around like yeah figuring out how to get that graphic on the on the front of it and I'm still trying to yeah like I said streamline the yeah getting it back to you and one of the things about me probably not the best thing in the world is like once I'm done with a chat like I'm done like I don't I don't have I don't I'm I moved on to something else and so I don't I don't find a ton of time to like Tinker with it and that that's my own weakness uh because like I'm not I'm not maximizing content value but I'm also

like I'm just doing something else so yes well I'm happy to Tinker uh but yeah we'll just figure out what uh how we want to do it uh the publishing rights thing sounds like the best move though I think uh okay that way I can just upload it uh from here and just get it where it needs to be so I know how to give that access but I don't know how to use it so we can go from there once we get started I'll give you the access and then we'll figure it out from there okay that sounds good um let's see so I on my end uh to to play on what we were what we've been talking about or to summarize what

we talked about I guess in the last few days some of the key uh hit points have been uh an overview of the online community uh different branches of it what those branches uh offer uh in particular particular strengths uh in those different branches uh and sort of just differentiating between them that was a a good chat also giving the names of some active members of the community who are producing content that would be considered uh valuable noteworthy have you consumed any of that uh let's see uh the specific I haven't

been to the Reddit page I've uh I've looked around at some of the followers to your Twitter page and try and sort of investigated some of that I have not gotten on that YouTube page that uh you recommended the the gentleman you recommended yesterday but uh I if if I could encourage you to do anything I would encourage you to begin by listening to the Daily way every day okay because what you're going to find is like as a as a beginner 90 of it is going to be like be Goblin gobbledygook after a few weeks you'll you'll catch some recurring themes and it'll begin to

make more sense okay I have subscribed to it uh I think and it comes out about eight eight thirty uh every weekday-ish um and so like I do it while I'm exercising but it's best like if you just fit it into your schedule somewhere and then be like this is my daily wait time whether you're driving or like whatever it is that you can fit in um and then we can yell at Anthony if he ever misses an episode for messing up our schedule okay uh I don't think I'm subscribed to it so I'm going to subscribe to that now g-w-e-i that's right guay is is just a

measure of the unit of gas for ethereum okay gas yeah gas is is the um wow oh my gosh like can I have two minutes to zoom out and tell you what ethereum is like I could do this so fast sure ethereum is a smart contract platform it allows people to write programs that run exactly the same way every time in a trustless environment but to harness all of this computing power thousands of computers around the world it's not free it can be pretty cheap though so ether is the gas for the ethereum smart contract network if you want to interact with that that platform you buy ether

and then you do things and as you do things that ether is consumed by the network in many cases it's burned by the network or awarded to people who are securing the network and so um that is ether exists to fuel the ethereum smart contract platform done okay and uh I'm presuming are we are we talking about gas fees that's now it's uh more okay uh I'm presuming as as gas or that the trend is that gas fees are lowering um as the system finds ways to make it more efficient I'm not

I'm not sure yeah no that that's really cool um so yeah transaction fees uh so the difference between gas and transaction fees gas is how much ether you use right and so it's it's measured usually in way so you might say you know that transaction was you know 500 way that was the gas fee that I paid um but when you multiply gas times the exchange exchange price then you get the transaction fee so if you paid like 500 gas at and you know the the transaction or the the exchange rate is you know fifteen hundred dollars then you end up saying well I paid four dollars and fifty cents as a transaction fee

um and that didn't answer your question that was that was tangential to your question remind me the question was there's a good one that I want someone else uh well the the difference between uh I was under the impression that staking cheaper and gas were uh or no I'm not sure I'm confused no you you were wondering if it gets cheaper like if okay and that's that's a huge question we call scaling um and so uh when ethereum was first developed obviously it was new and um there was no one using it and then everyone you know discovers it and begins using it and then they have to do

improvements to the to the platform to allow for more transactions and so each one of these hard Forks usually includes updates to improve the efficiency of the smart contract platform in an attempt to allow for more transactions what we're moving toward in the future like um is is that the ethereum network is a settlement layer for lots of some lots of these things we call Layer Two Solutions and they are other platforms that check into ethereum for security but allow really cheap like microcent transactions okay uh is the relationship between gray

and ethereum similar to cents and dollars uh there's a a fraction of gray equals one ethereum is that a is it a fixed ratio unlike uh market value relationship of ethereum to dollars is it a fixed number of gray equals one of theory yeah I want to say that uh one way is like and I'm sorry I should know this better I don't look at it very often is like eight decimal places um so point one two three four five six seven eight zeros one uh if ether is one way and you'd want to double check that it is it is like static math it's just not something I think about every day so fractions of a cent it sounds like yes yes okay and so the the the transaction

fee is uh the expense to the network of completing uh steps in the smart contract so if it's a simple smart contract we call these a simple send like if I'm sending ether from me to you that's going to be like super cheap but if I'm engaging with uh like a maker Dow collateralized debt position where there are you know hundreds of of uh smart contract steps involved then you know you're looking at a hundred dollars in fees and if if ether is very expensive um so like right now ether is fifteen hundred dollars if ether was 10 times the cost it is now a transaction that

today would cost 100 might cost a thousand dollars and that's why we have uh what we call Layer Two Solutions and they are much cheaper to use they have much higher throughput um but at the same time uh you know I talked about it being expensive to interact with a maker.cdp if you're doing something that's very valuable to you uh like um maybe you are buying a hat but no something on network something on chain that is very valuable to you like uh I don't want to be too complicated about like what could happen but maybe you really need this transaction to go

through maybe you're willing to pay a thousand dollars for that maybe your outcome is that you're going to get ten thousand dollars and the one thousand dollars is no big deal uh so it's all relative and yeah okay so there are times when a high transaction fee is Justified oh absolutely especially you're going to see that in March um in March when we have this Shanghai hard Fork uh when withdrawals are enabled there are going to be races uh when that happens uh for different things the the most obvious kind of race is someone has lost control of their um of their ethereum keys and maybe

somebody maybe I'm the thief and as the thief I want to get that in my pocket as soon as I can and so if that ether is worth forty thousand dollars then heck I'm willing to pay five thousand dollars in a gas fee to be the first person to be the priority uh and and get that in my pocket oof how do Keys get lost uh so the most obvious way is uh people leaving them uh unsecured on their computer and maybe their computer gets attacked so you know you get viruses and maybe those viruses are scanning for uh things that look like seed phrases or private

keys and when they find them they send them back and so you're like I just noticed my computer got hacked and I have my seed phrase uh in in a uh in a notepad on my desktop you can't really know until someone else does something if it has been stolen and so first best practice is never leave your sheet phrases like on a computer they should always be written down on paper um okay that's good next it's like let's let's move that before somebody else does it becomes a race to get it first oh and uh uh I guess the moving and shaking uh occurs anonymously so there's no way

in terms of well I guess the attitude's different though uh you don't look at that as in terms of uh criminal behavior is it is it looked at is it okay and if if you're if your keys are compromised and stolen you should report it to the FBI and the local police okay period uh yeah I mean because I made light of hacking the other day um there is unethical and immoral and illegal hacking uh that does exist and that is when you integrate someone's computers and steal their keys uh but there is an expectation when you put a smart contract on the network that people will poke at it

um and those people are not necessarily black hat attack hackers in many cases they're just curious people they're not necessarily trying to steal something they're not getting into your computer digging for your keys trying to steal things from you they are doing kind of like Network penetration testing I see another potential lesson on prudent security measures that uh oh yeah that would be great to be a good discussion or a good thing to put together uh just knowing that you don't want to leave it uh as someone who loves the note app knowing that you don't want to leave that information uh copied and pasted into one of those programs on your

laptop uh yeah I hope I hope in a few days we get you set up with metamask if you're not already and get you something like an ens address as we're doing that we'll talk about uh how to secure that so that no one else is going to get access to your funds and and also levels of security like you don't want to leave a million dollars secured by metamask um it's actually we end up using devices like uh so I'm going to unplug those is a uh grid plus by lattice one if I get in the camera if you want it um so this is a and I had to unplug it

uh because my my plug is is right near the desk but it's a hardware wallet it it links to your browser and prevents anyone from stealing Keys directly from them okay so you have to physically push buttons here on this screen before any funds can be moved even if someone gets into your computer unless they know your passcode and are in your seat and you know are hijacking you they can't get your stuff okay uh back going back to metamask I about a year and a half ago I uploaded uh gosh 10 or 11 nfts uh or some of my digital art converted to nft and I had

to have uh had to open up a meta mask I don't know if it's an account a wallet uh I'm not sure what the what the terminology is but I had to move uh I guess for transaction fees uh which was surprisingly expensive um at least you know to a novice uh but yeah uh I lost I think maybe about a hundred dollars or so which to me is which to me is expensive uh just no that's expensive to any sane person in the fees of converting uh uh the R2 uh to nfts and posting it on a site and there was a conversion I think my

ethereum had to be converted to Seoul and then uh Soul was the primary coin that was used in the transactions yeah um that's that's Solana is is a contract platform they they regard themselves as an eth killer and so they they sacrifice decentralization for Speed and cheapness um one day one day we might talk about these this the snailing trilemma but it's it's all complicated anyway Solana is is another chain and they're like you know what you don't really need worldwide

decentralization to have the smart contract platform what you really need are a few really fast computers uh and so that's that was that's their competition but Solana has gone down several times and I think that their platform has mostly crashed and dissolved I know it still exists but it's I think it might be dying or dead at the moment um yeah it's been a year and a half and it was only uh a couple of a couple of weeks of uploading that uh that was the extent of my uh experience with it but I had to I had to create a wallet I don't even know how much if anything is still in that uh in the wallet I I would really have to blow the dust off some of

that stuff and uh take a look at it but it's it's been a while but yeah I do have some uh at least broken the seal on metamask you have some soul man probably yeah yeah which is probably not worth anything no I mean I I don't know I the last it's hard for me not to like rub salt in a room in a wound because this is a platform that like a year ago was like we're going to crush ethereum and yeah this is about a year ago they have fallen on Hard Times um wow they've actually rebounded uh they're they're trading at 21 right now and I think that they they were trading around 200 a year ago yeah so

November 6 2021 they were 259 dollars uh yeah anyway um we we will talk about Heath killers at some point they they do they are in some ways a thing that Spurs ethereum toward Positive Growth but in other ways they're a real distraction unless they are actually like bringing some kind of new value which doesn't happen too often okay I'm trying to write down crypto Killers as future uh these colors oh sorry Heath Killers

I'm reading and talking at the same time uh uh defy that was the last question that I had uh written down prior to uh this one what are these things uh what is defy yeah so there have been like a few rages uh or uh fads in ethereum uh things like we had this thing called the Ico boom um and that was when it was I think I

guess 2017 when a bunch of platforms are like we are going to launch a new platform we're going to launch it from ethereum uh we're gonna take Investments and then issue you a token and we're going to build something huge and incredible and that's called an initial coin offering so it's an Ico and so uh people dump money in and they get coins 99.9 of the time uh the people who were selling or promoting those icos just took the money and ran like yeah um so that was one of the early fads in ethereum and then was something like nfts

um and I don't want to call it a fad it's still around but you know you create these jpegs and you sell them and you make a ton of money um another of the I shouldn't call them fads because they still exist in a valuable way but they got really big for a while like bigger than last December uh it was everybody on the news was talking about it yeah I guess it was about six months leading up to that yeah there are these these big like booms I guess uh and so Defy is another one of these things uh there is this time called defy summer uh and that is decentralized finance it is the idea of Defy is

um essentially recreating complex financial instruments on on top of the ethereum network uh and so um think of things like I take my ether and deposit it at a website they take that ether and uh maybe loan it out to an Ico the Ico gives them tokens in return that they distribute to people who have deposited and they get yield and so one of the big themes of Defy is the idea of yield that is depositing coins or tokens

and getting Returns on that and that's that's essentially like a driving engine behind D5 another angle of Defy is leveraged lending so uh let's say um you know we could even turn to buying a house let's say I have 10 000 ether and I want to buy a house but I don't want to sell my ether I could take my 10 000 ether and lock it up in a contract and borrow against it uh and that's that's essentially a um a credit-backed loan or I'm sorry an asset backed loan and so I put in 10 000 and I can borrow three thousand ether

uh and you know at current prices then I get 450 000 in cash when I sell that and then I could buy a house and technically I haven't sold my ether right because it's locked in this loan and ideally if the price of ether goes up then I can pay that loan back more cheaply and I I did good on the house another thing a lot of people will do is take ten you know 1 000 ether and borrow ten thousand dollars against that and buy more ether with that deposit that borrow against it deposit that and borrow against that I call that rolling

a CDP so you're like getting into this really deep leveraged position yeah if the price of ether goes up you did really well if the price of ether goes down uh you're required to put more collateral into that position to keep it collateralized if you cannot collateralize it you're liquidated the the system not any person but the smart contract layers will sell your ether on your account at market price in order to settle the loan and so if you have a thousand ether and you borrow ten thousand dollars against that

but the price of either goes down uh the network will sell your ether to cover that ten thousand dollar loss to make the system whole at your expense and that's called being liquidated um so these are defies essentially you can imagine it just as complex financial instruments built on top of the ethereum network okay I guess I was reading an article last night that mentioned that uh please the two things are are yields and loans that those are the at least I'm not I'm not huge in a D5 but those are the two like

Hallmark features okay um well let's see uh well I I mentioned the first half of what I was what I was thinking about in terms of putting together some instructional materials first was the crash course into the branches of uh social networking uh the second one was the scenario uh we talked about more of the sequential uh so I got a hundred dollars what do I do and the five components of that um I'm dying to answer this when can I answer this well I don't know what what we're at time wise for today do I we can dedicate

all of tomorrow to uh just getting started directly with them wait a day we can we can do it if we got time I don't know you're the loquacious one you know I'm just listeners um I don't even know what our time is but the question excites me because um it has evolved over time until now I'm like I know exactly what I would do with it oh and and so um can I do it you so do the setup and then I'll I'll do my side of it give me the setup like you told me like some guy who you know oh okay uh

yeah I was I was talking to him about the the chats but uh we've been having and uh his uh response was uh I got a hundred dollars what what should I do or ask ask him what I should do and uh I said that I would and here we are okay so I'm coming at this as an eighth Maxi um not as a profit Maxim and so the idea being that you're going to deposit a hundred dollars and forget it like you're you're coming back in 20 years to see what happened to it because if it's like a short-term investment then my suggestions might be very different then

it would be like you know how how can you what what's the maximum quick profit um so the idea is you have a hundred dollars and you want you want to come back in 20 years and see how it did um now if you start at coin gecko you're going to see like the top thing is Bitcoin and so you kind of have this assumption that Bitcoin is going to last a while I agree with that but you also know that I think Bitcoin is a month sorry a Model T okay right ethereum being a smart contract platform it's in really rapid iterative growth it's really doing well it has a lot of brains and development behind it the next few things tether USD coin

those are stable coins if you invest in a stable coin in 20 years ideally if you're if you're not if you don't blow up you're gonna have exactly what you started with um so you'd have a hundred dollars then uh there are a couple other projects but I'm going to assume that with a hundred dollars we're going to invest it in ethereum in some way and the simple answer is just by Ether and hold it but I want to take it a step further uh you know that staking is enabled on ethereum now and staking means uh you put a bond on the network and you get you know safely four or five percent return every every year

um and so really the the best bang for your buck is to take that hundred dollars and put it into an ether staking token because then you're getting uh if if ether appreciates an asset in in price you get that and if uh the staking token is gonna like add rewards onto that uh and so to look at that to look at the staking products we would go to um rated.network and rated.network shows a couple different places where you could stake uh are you looking at that or am I looking at that uh I could actually

share it sure I need to open a new screen up I always have junk bro um okay so this is rated.network uh this is one site that looks at uh Beacon chain validator rankings these are places that stake and how much return they're getting and these are

if as as super Fizz the guy on the internet I'm always going to tell you the best way that you can stake is solo staking from home on your own Hardware but that takes 30 32 ether it's like 45 000 right now or not gonna happen uh and so what you're gonna do you're gonna need to use a service and so I'm going to zip through some of these Services okay people who who are new tend to go oh cool yeah people go tend to go toward Lido uh Lido isn't a product that I recommend because uh they have a very centralized operation and they have sort of openly stated that like they want to take over the network and uh that's

totally contrary to our decentralized ideas coinbase is similar it's an exchange provider they hold all of your coins and they stake for you and they're in control uh going all the way through the next three Kraken finance and Bitcoin Swiss they all work the same they take your coins they're called custodians they're custodial exchanges they stake for you to be very honest you don't hold any ether uh you hold what we say is an entry in their database and if if they fold if they go out of business if they delete you if they're like we don't like you then they're in control of your funds oh and that gets us to Rocket pool which that's the place that I really

suggest people using um I'm going to say some words like trustless open source decentralized permissionless and fractional we can go over those words sometimes sometime but the idea is uh when you stick with rocket pool you stick with this worldwide network of like 1900 individual operators who stake on your behalf you do that through a smart contract so even if rocketpool fails you can still withdraw from the smart contract uh so I'm gonna uh it's I talk about rocket pool a lot I'm absolutely obsessed with it uh but for all of the right reasons um and so rocket pulls staking token is

called r-e-t-h-r-eath um and if you go to actually I'm going to show where it's at if you go to stake.rocketpool.net um you could actually buy RPL tokens here so you have a hundred dollars that's going to be like wow that's pretty close um .07 eth that you're going to send to them and they're going to give you 0.065 our eth um asking me why there's a difference there

okay what's what's going on why the difference so the longer our eth exists the more staking rewards it accrues oh so value accrues on that token so ideally in a year or two or we said 20 years if you come back you still have .065 ether but at that time it's then worth like 0.015 each okay and if we have the Assumption you know East is worth whatever five thousand dollars then then you have 70 or 750 um out of the out of the original deposit um yeah anyway

I feel like if I'm terrible like if I get started talking about rocketpool I just gush non-stop because it is such a a cool and highly aligned product okay well then I guess there's room to learn more uh about that and uh that certainly sounds like a better rate of interest accruing than I don't know your typical uh savings account or something along those lines you know well you're accepting a lot of risk you're accepting a risk that ethereum will do well uh you're also expect accepting something we call Smart contract risk that is the risk that that rocket pool might not do well

um and so for each of these risks you're half you're having to decide is it worth what I'm getting back out of it or am I accepting more risk than I'm comfortable with and that's always a difficult balance I would also there's also risk withholding US Dollars like they inflate um that's why people go to things like gold and even gold is not like it's it's not a totally safe asset uh yeah uh and of course uh just for example I was talking to I went to England in 2017 and uh London was an extremely extremely expensive city and then I talked to somebody on Friday who

said that the pound versus the dollar now it's a lot uh cheaper for an American to go over there and spend the money and have a decent time um so okay well as with every chat um you open one door and it creates a room with three or four more doors in it and uh we've got a few more things you know I'd love to learn more about uh rocket pool and um gosh uh the family of ethereum killers and uh I'm just looking at the the notes that uh yeah yeah I'll need you to steer me honestly to not always talk about rocketpool because I am so excited about it and like I acknowledge I talk about the things that I like and

if I'm allowed like I will not shut up because I'm just the things that excite me or the things that I like will keep talking about forever and it's good because you'll see a lot of things that excite me here I'll just try to keep up and ask questions uh as I as needed um but we had a good stopping point for today yep I think I'm going to put this in Dropbox and I'm going to give you access to the east Staker YouTube channel um as we get that figured out I think you would want to upload both of these talks maybe or however you want to do it I I hate for one to be lost in a different channel so yeah yeah okay yeah we'll talk um and uh yeah I'll uh I'll look uh just

let me know when that's ready and uh I'll hop right on it all right see you Jason all right later [Music] foreign [Music]