TL;DR
If Ethereum needs to scale AND proceed to carry the title of ‘Extremely Sound Cash,’ it wants to maneuver from the Bloomingdales mannequin, to the Walmart mannequin.
If Ethereum’s transaction fee goes down (prefer it has just lately), the provision of ETH truly goes up, watering down its general worth.
So with a purpose to keep ‘extremely sound’ Ethereum must change into the Walmart of crypto: As a substitute of processing a small quantity of worldwide financial transactions at excessive charges (anyplace between $3-3000), the ETH community must transition to excessive transaction volumes, with tremendous low charges.
Full Story
Bloomingdale’s 2022 income = $2.8B Bloomingdale’s mannequin = promote costly objects, in low volumes.
Walmart’s 2022 income = $573B Walmart’s mannequin = promote low-cost objects, in excessive volumes.
If Ethereum needs to scale AND proceed to carry the title of ‘Extremely Sound Cash,’ it wants to maneuver from the Bloomingdales mannequin, to the Walmart mannequin.
Confused? Here is what we’re on about:
Each month, there’s a specific amount of latest Ethereum created, with no cap on how a lot will be created in complete, over time.
To fight this fixed inflation fee, a piece of every price is destroyed each time an Ethereum transaction is made.
The extra ETH transactions are made → the upper the transaction charges change into → the extra ETH is burned.
…the concept being that the entire quantity of Ethereum will truly lower over time, as extra folks begin utilizing it (giving it the title of ‘Extremely Sound Cash’).
The one drawback is…
If Ethereum’s transaction fee goes down (prefer it has just lately), the provision of ETH truly goes up, watering down its general worth.
So with a purpose to keep ‘extremely sound’ Ethereum must change into the Walmart of crypto:
As a substitute of processing a small quantity of worldwide financial transactions at excessive charges (anyplace between $3-3000), the ETH community must transition to excessive transaction volumes, with tremendous low charges.
Step 1: guarantee low charges, no matter present transaction quantity.
(As a result of nobody goes to undertake to a worldwide financial community that is charging $3-$3000 a bit, in charges).
