The Scale Ability of the Ethium Computer

Today we are re-sharing our Business Breakdown on Ethereum. This episode was originally released in May 2021 and became the inspiration for Web3 Breakdowns.

Launched in 2015, Ethereum is an open-source, blockchain-based platform with a native cryptocurrency, Ether. Today, ETH stands as the second most valuable cryptocurrency to Bitcoin, and Ethereum is the preferred platform for blockchain projects.

To help me break down Ethereum, I am joined by Justin Drake. Justin is a researcher at the Ethereum Foundation. During our conversation, we cover what differentiates Ethereum from Bitcoin, the increasing number of projects being built on the Ethereum platform, and what a shift from proof of concept to proof of stake means for Ethereum. I particularly enjoy Justin’s framework for defining money and various analogies to better conceptualize the blockchain. I hope you enjoy this breakdown of Ethereum.

For the full show notes, transcript, and links to the best content to learn more, check out the episode page here.

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Show Notes

[00:03:02] - [First question] - What a blockchain is on a fundamental level

[00:04:36] - A core overview of Bitcoin and the Bitcoin blockchain

[00:06:40] - Proof of work and why security is so important

[00:08:38] - How much miners spend to secure the network

[00:10:20] - Early days of Ethereum and what separates it from Bitcoin

[00:12:02] - Vitalik’s role in the rise of Ethereum

[00:13:14] - What can currently be built on top of the Ethereum blockchain

[00:16:28] - Gas fees and an overview of ETH as a triple point asset

[00:19:42] - What generates ETH and decides its value

[00:22:36] - Defining proof of stake, how it works, and staking incentives

[00:25:10] - Yields from staking ETH in the form of newly minted tokens and tips

[00:29:15] - Load to power ratio of the Ethereum network

[00:33:38] - Terms for staking your ETH and how much is expected to be staked

[00:39:19] - Sequence of events when using ETH to buy an NFT

[00:43:13] - Transaction fees how they’re calculated when buying and selling ETH

[00:46:11] - Pros and cons of high network demand while trying to scale the Ethereum blockchain

[00:50:41] - Defining money and why Ethereum’s design makes it optimized to become an economic engine

[00:55:11] - Defi Pulse - The Decentralized Finance Leaderboard

[00:55:47] - Ethereum’s rigorous decentralization standards and best in class proof of stake

[00:58:57] - Overview of Bitcoin Wrapped and ETH as the native currency writ large

[01:01:16] - A further in-depth analogy to better understand the Ethereum network

[01:05:19] - Potential competitors and new DeFi blockchain innovation

[01:08:27] - Key lessons for builders when studying Ethereum and decentralized finance

[01:11:03] - Bankless, Epicenter.tv, Zeroknowledge.fm, Into The Ether

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