BNB Reddit Mentions | ChartExchange

A few bear cases for our space. Some have been mentioned by others already. These points are obviously all speculative and depend on decisions done in the future.
- Decentralization, censorship resistance and credible neutrality are not demanded by anyone in the space. So we end up in a walled garden of centralized databases like tempo, BNB and Solana. As always, no one needs these properties until they need them because they got debanked. At the moment there are quite a few projects which claim to be much more decentralized than they really are to get street creds. Similar things happened since the inception of our space, so not too worried here.
- Staking centralization: Might be that in a few years only a handful of entities run validating nodes which makes it easier to collude for personal gains. Largest node operator is coinbase which has 11% of all validators. After them comes Kiln and Kraken with 5% each and then many in the 1-2% range (Source is rated.network and coinbases own reports). This means we are in an ok spot at the moment as there would need to be many entities colluding to do anything to the network. But centralization is in my view the natural way things go and there needs to be a constant battle against it.
- People stop running (non-validating) nodes. This means no one outside of the inner circle is checking the integrity of the chain anymore. This might make stealth upgrades possible. See for example an upgrade that was pushed on solana by the solana foundation and the node operators last spring. The public only realized 2 weeks later that they stealthily updated the chain. Scary stuff. (https://www.cryptopolitan.com/solana-faces-scrutiny-after-private-patch-of-major-cryptographic-flaw/)
- Resource demand for running a node skyrockets. This would lead to staking centralization as mentioned above. Difficult to balance and therefore can be slowly eroded over time.
- An upgrade bricks the network. At the moment Ethereum has an 100% uptime. No rollbacks, no downtimes. Much better than anything else in our space. A narrative than can be lost with one single bug.
- There just isn't enough demand for all the transactions we are scaling for. Similar to the first point.
- Privacy never gets implemented properly. At the moment every transaction is transparent. For many states it is easy to connect your name to everything you are doing. You supported a group which is against the current people in power, that is straight to jail with you. There are ways to anonymize your transactions, but they are cumbersome and might make further transactions with centralized entities difficult.
- Rollups might never get implemented properly. At the moment the largest rollups have do have lower security guarantees than they could have. Most are working towards improving that, but progress is slower than, at least I, expected.
- Ethereum governance process gets co-opted by malicious actors or turns into a fruitless turf war. Ethereum governance is complex but has shown a lot of resilience against influence of single actors, which is great for a credible neutral Network. This could get subverted by some larger entities.
- People might like Ethereum the Network, but not uses Ethereum the token as much. Similar to how many people love Bitcoin the token, but only very few use the network at all.
- Regulatory issues. Mostly gone now, but they might come back at some point in the future.
- A decentralized Network of companies like the Ethereum space is not as efficient in pushing narrative as other projects in the crypto space. Having thousands of uncoordinated voices makes it easier for malicious actors to divide and conquer, see: https://en.wikipedia.org/wiki/Defeat_in_detail
I am sure I missed many other possible bear cases. As you can imagine I am all in on ETH not because I think it is smooth sailing for the Ethereum space, but because I think other ecosystems are in much rougher water than they claim to be. And some haven't even built a ship yet but claim to already winning the race...
I am honestly not sure where to read about all the bear cases. In my view the Ethereum space has a lot of intellectual honest people which discuss the bad sides and trade-offs of certain paths in detail, but I do not know of any easily accessible site. For me one of the better ones is Vitaliks website (vitalik.eth.limo) which discusses alternative roads from time time. Podcasts where he appears are always great and the way he discusses topics it is easy to see bear cases if things go a different path.

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BNBUSDT20240119C290
Binance Coin / Tether USD Jan 19 2024 290.00 Call
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