Ethereum is unforkable, ETH on-chain and much more - The Daily Gwei Refuel #69 - Ethereum Updates

Transcript

hello everyone and welcome to another episode of the daily gray refuel where i recap the latest news in the ethereum ecosystem i'm your host anthony cesano and today is the third of march 2021 all right everyone let's get into the news from the last 24 hours so actually i posted this tweet just a couple of hours ago basically i was looking at some on-chain metrics around ethereum because i'm getting ready for uh this month's uh kind of ethereum data pump uh data pump episode where i go through the different um on-chain analytics for ethereum and define all that so i mean subscribe to the channel if you if you if you don't want to miss that that will be out this weekend uh but basically uh what this chart shows and it's called the ethereum huddle waves chart and what it shows is it basically shows

like when was the last time you know you know eighth was moved on chain now the reason i highlighted this is because twenty percent of the total each supply has not moved on chain over three years and you can see on the chart here on the left hand side it will give you percentages per kind of like time frame so between three and five years uh 16 hasn't moved and then uh five years and more four percent of the total supply hasn't moved in over five years which is pretty interesting right because the ethereum network came out in 2015 and that five-year metric only came into existence last year because before then we only had up to um you know under under five years so it's really interesting to see that four percent of the total supply which would be about

maybe i think 3.5 million eighth has not moved in over five years which at this point i would consider was probably never going to move right i mean if you haven't like if you haven't moved it since genesis you've either kind of lost the keys or um you know you you're not interested in it you forgot about it right maybe someone does come ahead and move it one day and we'll know more and more like if it gets to like the seven year range where we'll see like if there's been any coins you know not moved in in seven years or more as well so that's going to be interesting to watch and you know you can look at the other time frames here i would consider anything that has been active in the last i guess six months to be the active supply of eth

right anything after that seems to be holder supply because if you if you haven't kind of moved your your eighth on chain in six months it's fair to say that you're a holder right i think um i think that makes sense or maybe your eighth is in like a uni-swap pool or whatever and it's just like you know trading there that's still i mean it's not holding but it's still different to just outright kind of moving it um to sell it sort of thing and i would say that in terms of like actively traded supply it's probably like i i guess like a month or less and and that metric is about 19 i think almost 20 which is like the actively kind of traded supply here and then after that yeah you can see the breakdown here on this chart which i thought was was really cool here but you

can go check out this chart for yourself if you don't have a paid account it will only show you data up to one year ago i think um there's a there's a paid version of of of this kind of tool that you can get and so it's on glass note the links down here it'll be in the youtube description but basically it'll let you see like the most kind of up-to-date data here so yeah that's really cool to see i think obviously it's bullish when bitcoins haven't moved in a long time right it means they're part of like the holder base or at least they're part of like exchange cold storage as well which counts for a lot and it's funny if you actually go here you can look at the bitcoin hotel waves as well and obviously bitcoin's been out longer than ethereum so you know it has like a

10-year metric i'm pretty sure if it wants to load up here um where it'll show you you know coins that haven't moved in like over 10 years and it's actually crazy over 10 of the btc supply hasn't moved in over 10 years on chain and i think a lot of this is the original kind of supplier that satoshi mine that is that is attributed to him um or them uh but you know then then we break it down more and you can see that you know over seven years uh hasn't moved seven point six percent of the supply hasn't moved in over seven years which means these are long-term holders right that's not satoshi anymore uh at least most of it i think and then you know over between five and seven years four percent of the supply hasn't moved so obviously as we keep ageing

and ethereum keeps aging we're going to go into these brackets as well but i don't think there's going to be a period of time at least not for a very long time where 10 percent of the east supply hasn't moved on chain in over 10 years right that's going to take a while for us to get there if we ever get there i think bitcoin's a unique case because obviously bitcoin was the first right back then 10 years ago it was worth like basically nothing so no one really cared and a lot of the original supply was was mined uh the the first supply was mined by satoshi and a bunch of other early miners like hal finney who who's actually passed away a few years ago so maybe you know he had cold storage coins that he kind of like put under a time lock or

something for his family or maybe he lost the keys to his coins we don't know but that's actually very impressive that over 10 of the supply hasn't been moved in 10 years um and that's of the total supply so the total uh kind of like i guess you could say 21 million coins so it'd be about over 2 million coins just hasn't been moved i'm not actually certain if that's the so the um total supply or if it's the circulating supply i think it's probably the circulating supply because it's measuring stuff that hasn't moved so if we take the circulating supply to be i think 16 and a half or something million for bitcoin i haven't checked in a while um and 10 of that we get like 1.6 million right and satoshi was thought to have like one million coins so there's another 600 000

there that you know might just belong to people that forgot their keys right a lot of people in the early days didn't really care because it was worthless so yeah very interesting there but i'm very curious to see how the ethereum huddle waves evolve over time here so there's been a lot of talk about obviously miners threatening to fork the network over eip1559 i'm not going to rehash that whole debate but that's been discussed a lot lately right um and arthur zero x on on on twitter here re-shared a piece from haseeb that he wrote i mean his wrote this piece a while ago i remember reading it in october of 2019 or november of 2019 where he says ethereum is now unforkable thanks to d5 now this is a kind of a little bit of a lengthy pcr i'll link it in the description you can

go give it a read but basically what it means what it it goes and runs through is is that we now have such a rich ecosystem of apps on ethereum that in order to fork ethereum and have your like fork survive more than kind of just like limp along you'd have to get these apps to come with you right because say you folk ethereum right now and you have all the apps on there it doesn't matter right the community doesn't come with you the ecosystem doesn't come with you the apps can actually be um you know shut down in an emergency shutdown way so for maker for example um it can actually be completely shut down by its governance system and then that shuts down die which shuts down kind of the rest of the i guess um the you know most of like the

activity and the apps on on on d5 in general so because of d5 it's very hard to fork ethereum and have a successful fork so that's why i think that if for some reason some miners band together and fork off of one five five nine and try to get their own fork to survive um there's like a pretty much a zero percent chance that that's going anywhere right no no like probably like maybe one app out of all the apps on ethereum might follow that for some reason right but almost all the apps have said that they are four one five five nine or they haven't said anything yet they haven't said four or against so the biggest app seems to be for it so i think that that that's what matters a lot but it's it's cool to see that these pieces were being written back in 2019

and they're kind of playing out now in 2021 right because ethereum has never really had a i guess a contentious fork besides the dow right i mean the dow is a bit of a different situation because it wasn't a planned thing right whereas you know bitcoin has had a thing in 2017 for those who don't know where there was like a big part of the bitcoin community at the time that wanted to increase the block size right they wanted to go from one megabyte to two megabyte and they didn't want segwit which was implemented on the bitcoin network um in the end but what ended up happening and right up until like i think a few days before the fork it was i think it was august 1st of 2017 at the four captain a lot of the hash power a lot of you know a big part of the ecosystem was

signaling that they were going to you know just follow the the two megabyte kind of fork and they wouldn't have segwi and then that would be bitcoin but then you know a few days before the i i think like roger via and a few of the other big players basically said okay well we're not going to fork bitcoin and and use bitcoin sorry we're not going to like make uh kind of like the the chain that we off be kind of like bitcoin we're just going to fork off and call like our thing bitcoin cash we're going to have bigger blocks and you know no segway all this sort of stuff so that ended up happening and that was extremely contentious at the time for those of you who were there you would know what i mean but like there was hash wars going on where miners were

changing chains right and the price was going nuts like bitcoin cash like you know i don't think it i i think it like went up so quickly and big and bitcoin went down so quickly um that i mean it didn't flip but like it was getting close i remember seeing all the money fly out of bitcoin like it was it was surreal you see all the bitcoin being sold and all the bitcoin cash being bought up because there was for a short period of time a very real uncertainty in the market about what was actually going to be the the real bitcoin now obviously you know the rest is history bitcoin cash kind of lost the and you know bitcoin is bitcoin so i don't think that's going to happen here with with the 1559 you know potential fork i mean as i've said many times i

don't think there's actually going to be much of a fork from this but and and i think that's a lot in large part due to the ecosystem on top of ethereum right the the application ecosystem d5 specifically um so yeah that's that's something to think about and definitely a piece to to read here i highly recommend reading it i remember reading it back in 2019 and thought it was thought it was really great and for those who don't know haseeb he works at one of the vc funds dragonfly capital and he he basically um you know he's pretty deep in the d5 kind of weeds and has been for a while as you can see here but yeah i think it's a good thing to kind of keep keep you know keep your mind on because i've seen people and they've messaged me being like

you know i don't understand how you know the ethereum governance process works i saw this chart that like miners are against you know one five five nine they've signaled that they're against it does this mean it's not going to happen and you know i obviously i can forgive people for not following along with ethereum governance it's it's definitely messy it's definitely something that you have to you know pay keen attention to if you want to follow along with it but at the end of the day and as i've explained many many times right on the refuel miners do not have power like they have very very little power and the game theory of of proof of work ensures that the miners are just going to go with the ecosystem goes at the end of the day and you know there are bigger some bigger players than others i would say

that some of the major d5 apps like maker compound rv you know control a lot of the vote right not not every voice is created equal that's just how it is it's just reality of it um so that and then exchanges also hold a big card here right if the exchange says that you know this is the um ticker of eth for this ethereum blockchain well i mean that right there is another kind of um i guess like a massive signal right and then especially the core devs being like well you know whether you know we're going to maintain this chain we're going to work on this chain this is going to be a theorem that's another one right and then you know the community just reinforces those views and kind of like helps to inform them as well around that so governance is super messy

i wrote a bit more about governance in the daily newsletter today actually if you want to check that out but yeah governance is super messy we're not going to figure it out you know you can't solve governance um but what you can do is you can basically have kind of like assurances that you know a particular group can't exert their will on another group and i don't think miners can exert their will on the rest of the community in ethereum i just don't think that's gonna happen and i can't wait till we have one five five nine in in you know what's looking like july at this stage uh where we can finally kind of like show people that managers do not have power here but what i'm very curious to see is what kind of like you know screw around the miners potentially do when we do the eighth one

to eth2 merge right because if they're scared about a thirty percent pay cut due to one five five nine then what are they gonna do about 100 pay cut when we do the merge right and i don't think what they can do anything that's like you know that's going to impact the chain or in a kind of like bad way or in a lasting way worst case scenario they attack the chain we just kind of like merge before the attack onto eth2 and that's it right the miners are gone i do think that the miners being profit maximalists are just gonna mine the chain right up until the merge and then everyone's gonna move over that chain will probably be kind of like um kept alive by some miners as part of like an opportunistic thing which is fine right free forked east for all of us to kind of like trade for more

eth whatever i think that's definitely gonna happen but again you know the power lies in the community the apps you know all the different stakeholders the node runners of course people who run nodes and decide where to point their nodes that's critically important too it doesn't rely in kind of like just the miners right and i actually much prefer the fact that we're going to proof of stake because i think proof of stake actually aligns incentives better between the people who are validating the network and securing the network and the people who are using the network because i never mind right but i'm a user of ethereum and i'm staking now right a lot of miners actually haven't used ethereum before and there's been like lots of talk about this where a lot of miners don't even you know they don't run their own nodes

they don't um even have metamask installed they literally just mine the coins and they dump it right they just dump eth now that's obviously not a really great thing to have when you want to have everyone aligned so a lot of the stake is right now in in on the e2 chain are people in the ecosystem that have been here for a while stacking eighth using eighth using d5 like isn't that just a much better kind of stakeholder group to have than than than miners who are kind of like just not in it for the same reasons and i'm not saying this applies to all miners but i mean so many of the ones that i've seen are just like not you know not very aligned right and um i i think you know from the mining pools and kind of like signaling this stuff

with their hash rate against one five five nine because they're going to take a little bit of a pay cut i mean that to me is just like because one five five nine you know the reason we want it is because it's a massive improvement to the ethereum gas kind of mechanism you know gas fee market kind of like that way we do fees not just because of the fee burning so yeah i know i've gone on a lot on a lot about this lately but i think it is critically important to understand how governance works in ethereum and which parties have power which don't because at the end of the day as i said there are some parties that have more power than others and there are some parties that don't have any power but think they do and i think that's minors um and not to say that miners can't do

anything if they all banded together maybe they could but at the end of the day the game theory exists to basically say you know you're going to mind the chain because it's profitable for you to do so if you band together and try and attack the chain you know you you have to be sure that all the other miners are going to you know stick to the the the kind of like plan that you made right um so it becomes a kind of like i guess for those of you who have seen the movie reservoir dogs right it becomes a game like that where it's kind of like you know you're trusting this person and this person is trusting this person this person is doing this and you don't really know right and it's all this trust and then eventually everyone just kind of like defects right and does what

makes sense for them and what makes sense for mine is is always to mind the most profitable chain you know miners are not a charity they need to cover their costs they can't just mine a chain at a loss because they're just obviously losing money and they can't cover their costs so yeah anyway digress there i think i i went on enough about that for now uh so bellagio put out this really interesting tweet just before where he said you know books are being banned but on-chain books will unban them because on-chain books are going to be nfts i've spoken about how nfts are going to go far beyond you know art pieces and in-game items and stuff like that and he basically lists the benefits here of kind of like tokenizing you know books right making nfts out of them

you can have crypto native payments you can have transparent royalties where the nft right of the book every time it's sold 10 of that proceeds goes to the original author right you can have you know your keys in your wallet so you control the you know the thing in your own kind of crypto wallet so not your keys not your books right um digitally signed special editions right which is really cool because you know it'll come from the person because they've signed it with their ethereum address or their ens or whatever no region locks you know totally global right for everyone to use no server-side censorship because it's on the ethereum it's decentralized and fully machine readable translatable and annotatable because it's digital first this is the things these other things that i think

haven't come to the forefront yet because of uh one of the major issues being scalability being the fact that nfts weren't really as popular um until recently that are going to change everything about certain industries right um you know for anyone who knows about like i guess like the book industry the publishing industry it's freaking bad like it's really bad especially you know college textbooks right um you know we call it university in australia but you know for the us college textbooks are like extremely expensive right and they're just like always required for different classes and you know the the the resellers don't kind of like pay royalties to the original publishers and stuff like that so it's just a complete mess and there's just like you know i mean ip law comes into a copyright law i

mean there's so much you know mess on it and it's just really really um really bad now this can help with that this can revolutionize that industry it's obviously not like a very flashy industry right it's kind of boring for college textbooks but where it does become flashy is when novelists start doing this when novelists basically you know skip write past publishers and just you know self-publish on ethereum i think that's going to start a movement in of itself now not to say that publishers don't have their role to play right they obviously act as like you know ways to get your kind of work out there through distribution channels and and kind of marketing and all that sort of stuff but there are a lot of people who self-publish but they usually do it on amazon now imagine being able to do it on

ethereum in a fully digital way and still have your physical books you know through amazon or whatever right um but be able to kind of offer all these benefits and i think we're going to see that because we're already seeing that with artists coming into the space to do their nfts and stuff like that so i think we're going to see that with with with books as well which is going to be really cool to see play out so super rare published this blog post about something that has been kind of i guess talked about in the nft community lately now as i've said before nfts are bringing in a host of new people into crypto right these are not crypto natives these are artists you know um you know musicians uh uh people who you know collect game items all this sort of stuff they're coming into this

space and they have a very different view of this this sort of stuff and they they they are not like our crypto natives and they don't particularly understand the underlying technology so what ended up happening over the past few days is that there's this narrative that formed around nfts actually actively harming the planet right and what this blog post aims to do from super rare which is actually a very good blog post i highly recommend going and reading it it aims to explain how the ethereum network works and how issuing nfts on ethereum does not increase the carbon footprint of ethereum and and the tldr is basically that plus what increases the carbon footprint of ethereum is when the each price goes up and more miners come online right i know i know at this point i sound like a

broken record with how much i talk about miners but but that's that's the point right the ethereum network uh hash power grows with the price of if that's just how it always it always is right hash rate follows price now and they also you know they go through this basically and they go through this in in a detailed way but not too technical which i thought was really cool and then they basically um mentioned that if the ethereum community is working on going to proof of stake which i really like because you know this is you know one of the major reasons we are moving to proof of stake because the ethereum community as a whole not everyone but most people from what i've seen consider proof of work to be incredibly wasteful and incredibly harmful for the planet now whether that's you know true or not

i mean there's discussions and debates for and again i'm not going to debate my point here i don't have a strong opinion either way um if i'm being honest but i like proof of stake for different reasons over proof of work but you know i think as we kind of get into more mainstream consciousness there are a lot of people who are very very environmentally conscious right they don't want to increase their carbon footprint if they can avoid it now and on top of that we're also going to have governments right questioning this stuff being like well this proof of work thing is very wasteful right you know bitcoins using potentially up to one percent of the global energy use to produce this thing and and whatever right i know as i said there's arguments for and against but i think ethereum moving to proof of

stake very soon um you know when the merge happens is going to be very very beneficial for its network because we'll be kind of immune from those attacks from governments and any immune sorry any immunity that we can have from from governments is going to be very important because we're obviously going you know and creating products that governments aren't necessarily going to be okay with and if we can get their attention you know away from ethereum in any way possible i think that's a net positive right and let bitcoin deal with that because i kind of view bitcoin as like a shield for ethereum because you know every every kind of regulator in government seems to be just focused on on bitcoin right and they kind of like focus on bitcoin uh from you know the the coin itself and then from the network and the energy use

so while that's happening we can just you know quietly in the background do all our stuff and then obviously merge into proof of stake and it's going to be all good there but i think artists in particular are very um conscious of their carbon footprint from what i've noticed and you know it's kind of abhorrent to them to see that uh you know these networks are using so much carbon emissions just to do something that they don't necessarily have to do you know proof of stake does work it does have some of its trade-offs right where proof-of-work has some advantages but the argument goes that you know the trade-off of not wasting or at least not using all of this kind of you know massive amounts of electricity um for for kind of i guess like i'm not gonna get too technical here but maybe

a little bit less security is worth it right so yeah i thought that was a very important post from super ray here and glad to see that they're actually you know they know what they're talking about you know sometimes i view blog posts from from different companies and i'm like this this doesn't make any sense right and and super red definitely knows what they're talking about so go give this a read i thought it was very interesting so xerox ruffy on twitter today put out this amazing thread on optimism and optimistic roll-ups uh it's a 25 uh a long tweet thread here i'm not going to read it out obviously you can go check it out but it basically breaks down how you know what optimism is what optimistic roll-ups are how they work you know how they um you know how much throughput they provide

i mean there was a really really awesome tweet down here somewhere i think where he basically said that um where was it yeah to put all the figures in context synthetics tests reported decreases in gas costs of up to 143 times and transaction confirmation times as low as 200 milliseconds while uni-swap tests reported decreases in gas cost of up to 100 times and transaction transaction confirmation times of 169 milliseconds so that i mean that that is just like a massive scalability gain there right um so yeah i definitely recommend going and reading this thread if you want to get a deeper dive on this from a technical perspective and you know it's not a long read here and it doesn't go too technical it'll just give you get you up to speed

on why everyone's excited about this technology uh there was one tweet that i got it got a bit of hate for which was this one about the differences between side chains and layer two solutions and i think i've maybe misrepresented this in the past as well where i've said and disclaiming here i'm an advisor to polygon which was known previously known as matic i've said that polygon is a side chain now i mean this isn't like totally true and mahalo from the uh one of one of the co-founders of polygon kind of corrected this and said that polygon is obviously not a side chain only solution which it isn't because poly chain has an ecosystem of different layer two things that they're developing but the currently deployed stuff the matic network right the matic pos network or

the polygon pos network um is a production ready plasma implementation uh with their side chain which uses ethereum for commits and staking slashing so i've spoken about um on the refill before about how side chains can essentially checkpoint themselves to ethereum to inherent ethereum security so something was to go wrong on the side chain right if say all the validators were malicious and like you know destroyed the side chain or like did something funky on there you could just roll it back to the the um the committed kind of state on ethereum right and as he says here there's also staking slashing of um kind of like along with that too so you can actually slash the validators for doing something wrong using ethereum too um uh not a theorem

two ethereum as well um so yeah it's very important um to kind of realize that and i think that it's it's getting a little bit harder to kind of break down what's a side chain what's a layer two you know what's good what side chain is bad all this sort of stuff right i think the term side chain is just like straight up it's just a bad term because because i've used it before to describe you know everything can be a side chain right you know centralized exchanges can be a side chain you know x die is a side chain anything that has its own validator set can be a side chain to ethereum like other layer one block chains but the reality is is that like it doesn't really make too much sense right just because they can bridge in doesn't mean they're a

side chain they don't really have anything to do with ethereum they can just bridge into ethereum so really they're just standalone things so i think you're either a layer two or you're like a hybrid layer 2 slash sidechain maybe right or you could say that you're a hybrid where you know you do checkpoint to ethereum but you also rely on your own security you know it's hard right and i think as an ecosystem um we have to kind of like agree on a term because i don't want everyone just calling everything layer twos i don't want people calling other blockchains layer two to ethereum because that is not true like it's objectively not true uh because you know polkadot doesn't inherit any security from ethereum it does not checkpoint to ethereum but it can bridge in right you know technically based on the usage of the term that i've been using

for a while now it is a quote-unquote side chain i guess you could say but it's not you know that that term is just like so bastardized at this point that i just don't want to use it anymore so from now on i'm going to try really hard not to use the term side chain i'm just going to say if it's a layer 2 or if it's a chain that's bridged into ethereum or if a chain that is kind of like inheriting ethereum security because it's check pointing to it which i think is the better approach to this but you know i think at the end of the day you know the end user shouldn't have to worry about this at all you know it's up to us to kind of like worry about it the people in the weeds and the people are building this stuff and educating

about this stuff but you know the end users most of the world is not going to know any of this right they're not going to care about it uh which which i think is fine but i think it's up to us to make sure that we build things that you know aren't like insecure or don't rug poor people right because you know i do think users care about decentralization when it matters because they may not come for the decentralization but they stay for it right because if they come and then they work they go on a chain or something and then they kind of get like rug pulled or or like their funds get stolen or whatever because of the chain security being um kind of i guess like compromised then they're gonna care right uh they're gonna care that it wasn't decentralized so i think that

it's up to us as builders to make sure that we build the most decentralized and secure systems for the end user so amazon aws announced a uh i guess like a new kind of feature on their uh service on the amazon web services today called uh general availability of ethereum on amazon managed blockchain now the trdr here from what i understand is it's basically a way to spin up the ethereum blockchain using amazon's managed blockchain services so you can spin up like an ethereum node essentially now the reason why you know you would use this is if you're like uh you know someone who needs infrastructure quickly spun up you can just spin it up on on amazon here and it's really easy to communicate with and all that sort of stuff and

they're going to kind of like more detail about this here i think it's cool that amazon is supporting ethereum but at the same time i don't recommend any home users like me and you you know to to run our stuff on cloud providers like aws i recommend running our you know your node locally if you can run it on your local pc i mean right behind me here i have my staking pc right that's where i run my kind of like eight one node my e2 node my two stakers on that box there all locally right um that helps the centralization because we don't want like you know all the nodes just living on aws where a government can just say to amazon we want you to shut down like all the the kind of ethereum nodes and then 50 of the nodes go offline or something

right that's very bad for decentralization so i strongly recommend not running nodes on you know you know for your own personal use on these um kind of cloud providers uh i i i i can understand why companies are gonna do it right because it you know maintaining infrastructure can be burdensome can be something that you just want to like delegate to someone else which is fine and you know the staking companies and infrastructure companies that do this too and they kind of like use these services but when you can run your node locally and on your own kind of hardware it's best to do that and if you aren't running an eth1 node today highly recommend going and doing it it's not hard there's uh there's a lot of guides out there bankless has some guys you can just search you know bankless eth1 node and you'll come up

ethup has a guide as well you can just go to docs.edub.io and check it out there and yeah it's very simple to get started and you help to decentralize the network out like that so i highly recommend doing that but it's still good to see um you know amazon supporting ethereum here i think it just like adds more credibility to a platform gets more eyeballs on it act as like acts as maybe a little bit of a marketing machine too which i thought was pretty cool so last a tweet here from jake shivinsky from compound finance so the tweet reads the entire world becomes much easier to understand when you realize that the economic value of any good or service is simply whatever someone will pay for it end quote now this is something that i have been grappling with over the past few weeks with people

because they see that in the nft space particular in particular there's a lot of things that are just like going crazy right a lot of pieces whether it be art or whether it be game items or whatever a lot of nfts are just selling for crazy amounts i saw the other day there was like a b pool kind of um uh piece that sold for like 6.6 million dollars or something right and that's not even like a a a a bad offender or anything people has like a really great you know reputation and following and he's been doing art for quite a while now but there are like i guess opportunists coming into this space right now that are minting you know these nfts and making a killing off of them and people are kind of being like what the hell like this is all over

value this is a bubble and maybe it is right but the point is is that it becomes easier to understand why this is happening if you just realize that people are parting with their money on their own right they're just like okay for whatever reason they're like i want to spend the x amount of money on this and whether they're doing it because they're investing and it turns out to be a bad investment right that's the same as any other thing that you'll buy right any other token that you buy you know maybe they're doing it because they really want to support the artist but maybe the artist never takes off right and then they they just have something that might be special to them you know there's a million different reasons why people buy things so jake's point here is that don't worry about why they're doing it just accept

that they are and i think that's that's that's really um crucial but if you are trying to use it as like a top signal or as like a way to see how hot the market is that can work as well because if people are just throwing money at stuff that you know seems kind of insane to throw money at and just doesn't make any sense that could normally uh maybe not normally but sometimes be like a top signal if that's what you're kind of like looking for but it's really hard because as i've said the nft space is attracting like so many different people right now that signs of like froth are indistinct indistinguishable from signs of adoption i think and that doesn't just apply to nfts i think that applies to the crypto markets in general where things are very frothy but are they frothy because of the fact that

it's a bubble why are they frothy because there's a lot of people coming into the ecosystem now and maybe that just goes hand in hand maybe it's a bubble because a lot of new people are coming in and those people won't stay but i don't think so because as i've explained before i think a lot of people are going to stay this time because of defy they're going to stay because of nfts they're going to stay because they're into governance right there's a lot of different use cases that ethereum now has to keep people here 2017 had none of this right all you were doing in 2017 was speculating on future use cases so i just this is why i talk about this cycle being longer right as a general kind of crypto cycle and maybe it being like the last cycle where we don't have like

another two year bear market or whatever i don't know for sure if that's going to happen i i actually think it might but um at the end of the day there's going to be froth wherever you look and it's gonna probably get much more frothy because we still haven't reached anywhere near kind of mainstream adoption i think crypto's going mainstream but the adoption of the apps is still nowhere near mainstream because it's just too costly right now we're gonna get there with layer 2 and all that all that sort of stuff but yeah i think just go along for the ride don't worry too much about what's happening what you know how much money people are making or how much money is being spent on stuff you know if you're scared that the market's topped out maybe you need to take some off the table not investment

advice but maybe you need to sell some right i've seen i've had a few friends do this where they were like i need to just sell right because it's too much stress i need to just get out of the markets um you're not all of it like you know some of their stash and that's totally fine right i mean i feel it too like i'm always anxious and scared when i see a you know a dump happen like especially the other day when i saw that 30 dump happen you know i kind of like thought to myself i'm like i believe this isn't the you know a new kind of cycle top i believe that we're not going into a two-year bear market or whatever again but you never know and you know as someone who sat through the entire bear market and watching it

you know um every single day and waiting for it to just go above you know 200 bucks for so long right you get scared and i totally understand that but if that's you take some off the table right i don't think that you should be like you know 100 invested into crypto if you can't be i mean i am right but i am for my own reasons um and you know i think i personally i think i should be taking some off the table myself but i just can't because i'm so bullish but that's not supposed to be like investment advice or a signal to you i don't know what's going to happen in the markets i might might be wrong you know maybe we're going to another bear market sometime soon i don't know but if you're seeing froth you know maybe you use that as a signal

to to kind of take some off the table because you're feeling not too comfortable about it and that's fine i don't blame you for that i don't think anyone should blame anyone for that taking profits is healthy you know you shouldn't be ashamed i mean the reason why most people invest in this stuff is to sell it at a higher price later right so why should you have been shamed for selling anyway i i've gone on to rant again about that uh uh i think that's it for today's episode because i've gone over time here so thank you everyone for listening and watching be sure to give that video a thumbs up subscribe to the channel if you haven't yet join the discord server subscribe to the newsletter and i'll catch you all tomorrow thanks everyone