Crypto Noobs: Let's keep it understandable!

Is Ethereum the next rocket ship? What is Ethereum?

September 15, 2021 Alexandre Fuchs & Gabriel Riesco Season 1 Episode 6
Crypto Noobs: Let's keep it understandable!
Is Ethereum the next rocket ship? What is Ethereum?
Show Notes Transcript

What is Ethereum? 

We talk about structural differences between Ethereum and Bitcoin: Philosophies, Blockhain differences, 

We also discuss questions and issues like:

  1. What are Tokens 
  2. Different kinds of Blockhains
  3. Decentralization
  4. Security 
  5. Proof of work vs proof stake 

We do not provide financial advise in any form. All information is our opinion and for entertainment use. 

Every Podcast we add to our public follow list an account we think of as Value add.  

This Episode we add to the list

A great Podcast By Laura shin covering EIP 1559 on Ethereum:

https://podcasts.apple.com/us/podcast/unchained/id1123922160?i=1000527216697 i

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Gabriel Riesco:

Well, hi, Alex, how you doing today? Good How you doing? Very good. So today we're going to cover a very, I think interesting subject, which is aetherium versus Bitcoin? What are the differences? And kind of understand the different uses of each one of those. So let's start first with aetherium. Because we already covered Bitcoin in previous episodes. So Alex, what can you describe what? What's the theory?

Alexandre Fuchs:

So, if aetherium and eath, I guess again, like Bitcoin is both a token and a protocol, where piece of software If you want, I think we're going to talk about them all together to try to keep it simple. But it's basically again, a decentralized blockchain technology where transactions can be recorded and they are publicly available on the public blockchain. But in addition to Bitcoin, or as a comparison to Bitcoin, which I think probably is what most people are interested in, it has several different structural differences, I guess, that make it more useful for certain things specifically, it was first it was built many years after Bitcoin. So in some ways, it is trying to address certain limitations that were against structural not deficiencies, not problems with Bitcoin was trying to be just a little bit different as ever, there are different philosophies about what the cryptocurrency and blockchain system can be. A theorem in itself is a, the way to think about it is that it is both at the base layer, working similarly to Bitcoin in terms of recording transactions, making them public and allowing you to have wallets of dresses where you can send back and forth, the individual tokens. But it also has certain scripting certain software languages associated with it, which allow you to build on top of that different projects that use different rules to do certain things. So whereas Bitcoin is very limited in what it does, and has, for example, a very limited throughput, it can only include certain amount of very similar transactions, both in terms of types of transactions and the number of transactions on each block of the blockchain. Ethereum gives you many more tools, were on to the Ethereum blockchain, that you can actually write other topics, other tokens, and the throughput itself is much higher, meaning that you can record many more transactions.

Gabriel Riesco:

Okay, so would you say that Bitcoin is more used as of right now, as a store of value, and aetherium is more where you can build all kinds of protocols on top of the blockchain layer?

Alexandre Fuchs:

Yeah, I think, to simplify again, and I think it is quite important, I think, for this audience and for the discussion to simplify in a wave that carries most of the material insights rather than try to get hung up on individual little pieces to simplify. There are a number of different layers in trying to build a set of financial services, if you want in and around the blockchain. And what Bitcoin is really good at, is being decentralized, being very lightweight, being very simple. And offering essentially a very well simple, not a really extended set of rules and, and use it uses, which in this case, as you say, can be simplified as it's a good store of value, or it's a good foundational layers settlement layer the way you want to think about the foundation in the house. It is the lowest most simple standardized protocol and the oldest and probably the most established, what aetherium did was to acknowledge that Bitcoin could not do a number of things, and could also not process a whole lot of volume, and therefore tried to be both the foundation and say, the first floor of the house at the same time. Could you could you give an example? What are the things that you can build on aetherium? That is not so easy to build on Bitcoin for whatever it's worth these days is a bit of a craze on arts NF T's right? So non fungible tokens, as are called NF T's basically what they are is that whereas every Bitcoin is more or less interchangeable, or every theorem is a table, The interchangeable you can create tokens. So you can create elements or units that are different from each other. And therefore, for example, you can attach them to a piece of art or they can acknowledge the veracity, the the authenticity of a piece of art, for example. And those can be built on the Ethereum blockchain, meaning that they can be packaged, specified, organized, protected, transacted on if they're in blockchain, they can be stored inside the blockchain, whereas you will not be able to do that on Bitcoin.

Gabriel Riesco:

Right? Could you explain why?

Alexandre Fuchs:

So Bitcoin basically, again, to oversimplify Bitcoin just does Bitcoin. That's all it does. You want to send a fractional piece of Bitcoin? That's what you do you send it from one address to another address, the protocol is very simple, it's handles very simple transactions. What a theory allows you to do is it allows you to store onto a theory some more complex objects. And those objects themselves can then be used by software languages to create new tokens. So for example, there are many, many, many tokens that have been created onto the Ethereum blockchain. In you know, similarly to how lightning and some other things are written onto on top of Bitcoin. But the theory is already prepared for already engineered to allow third parties to create kind of their own ecosystem, their own use use cases. So for example, there are many kryptos that will handle in video game currency, there are some that will, for example, deal with sports teams and kind of sports betting or, or sport properties, there are things that have to be tokens, again, that are targeted towards art, there are tokens that are associated to individual lending activities for, let's say, automobiles or trucks or hard assets, all of these different individuals specific, if you want to think of them as apps, right, can be written on aetherium much more easily than they can on Bitcoin.

Gabriel Riesco:

Okay, so just to make it clear, when you refer to tokens, you can build different tokens on aetherium, which is much more difficult to do on Bitcoin. Actually, it's impossible, right? Unless they're doing themselves with lightning, we'll talk about that later. But when you're talking about tokens, is it correct to say that tokens are kind of like companies or Icos that are built on top of the Ethereum blockchain? Is that correct?

Alexandre Fuchs:

That's a mess, right, because in the old world, you had you know, fairly simple instruments, you had equity in debt, currencies, commodities, right. And equity or securities gave you partial ownership of a particular business that had cash flows, and therefore, for example, the securities exchange commission has, you know, oversees and regulates the issuance the transaction of securities, but not currencies, for example. And, and again, debt securities are also securities, but there have obviously, a different payoff for the lender and for the borrower and so forth. tokens are this thing, which is new, and which can be a security can be a non security. There are a number of different arguments about this, the XRP lawsuit right now is really at the forefront of trying to elucidate for the markets, more or less what is going to be considered a security and again, take an example, which requires just a longer discussion. etherium, or the SEC is point of view as described by President past. commissioners was a security probably when it was issued, and is probably not a security today. And the reason is that a token is an item in a blockchain or in software, which can be used to do all kinds of different things. So for example, you have a token like uniswap rights, which again, that's been built on the Ethereum blockchain. And what that does the Ubisoft project is a project that allows you to outside of an exchange exchange in aetherium token for another aetherium token. So this gets kind of company that we may have lost already, some people but the way to think about it is that uniswap itself offers a very simple protocol so that you can go out and say I want to turn this particular crypto acid I have into another crypto assets and in order to do so the fees I'm going to pay to the people providing liquidity and providing this exchange. I'm going to pay for them in unisol swap tokens. So now, the uniswap token has now become a both a project, which is facilitating this exchange, but at the same time is a tool or the tokens itself are used to pay for the service which is provided.

Gabriel Riesco:

Okay, so let me understand this is, I want to make sure that I understand that people understand it too. So, if I understand this correctly, say with the example of uniswap uniswap, it's a project that is doing this service for doing the service that they're providing this token, right? So, if the service becomes valuable, then the value of the token is going to go up and the price of the token is going to go up. Is that right?

Alexandre Fuchs:

Well, yeah, theoretically, right. I mean, so stepping back projects, lead deliver utility, should attract users who are willing to spend value for the service, when the only way to use the service is to spend the token which is associated with a service, then that token should in turn, right and back value, because people are using it now separate from that there's all this speculation as to what the future is going to bring for the use of this token. So then you have speculators come in and say, Okay, this token is incredibly valuable, and it's going to go up and all that good stuff, all the market dynamics that we see. But when you boil it all down to the fundamentals, the reason there's confusion about whether a crypto currency, even though or crypto assets is a currency or not a currency is a security or not a security is because that token very often can be a measure of how well the service is doing, the project is doing. And while the project doesn't really look like a company, it kind of has revenues, and it kind of has costs, and therefore, in some ways, so for example, there are projects where the people who launched the project kept for themselves a lot of the available tokens. So what they do is that, okay, it's fascinating, because there's all kinds of different ways in which these tokens can be distributed, right? They can be what's called pre mined or post mine basically means do they exist when the project was launched? Did the creator of the project retain a large amount of those tokens? Do they have the ability to sell them into the market, as soon as a token happen, they're also very often new projects that are that are launched, where they just distribute tokens to everyone. And the idea is that at the very beginning, when nobody's using it, that token has no value. But as the use of whatever service project goes up, it starts having value and therefore many other people have it. And it's considered to be, you know, a nice thing to receive these tokens, you just have as a perfect example that was distributed through in there, what they call airdrops where you know, you basically just ask for it and get it or you are a record holder at a certain particular date. There's a flare airdrop coming for x RP, there's a number of airdrops that exists here and there. But basically, the point being that that token, in certain projects has a lot of value and is used directly in the service. And sometimes it's not using the service at all, like, there is not very much, there's a variability. So you can't you can't use a universal rule to say that he took it as a security or not a security was a currency or not a currency. This is the mess that we're in. But having said that, you can go and look up fees that are generated in individual tokens, or you can go and look at the sweep the fees that are spent on the uniswap network, one sushi swap, which is another swapping, again, this is these are tokens that are used to allow people to transact

Gabriel Riesco:

on aetherium right

Alexandre Fuchs:

again, and then. And then it gets more complicated, because that's the Ethereum blockchain. And then you have other blockchain like Solano or others, that are trying to compete with aetherium by having other philosophies about how to do things which are which caused them to be either more extensible or easier for people to write code and create new projects for, which is difficult to imagine, because there's just so many of them already on aetherium. But also do it cheaper or higher transaction throughput or whatever.

Gabriel Riesco:

Okay, so just to try I'm trying to organize here. So it seems to me that there's two different, there's probably more but basically two different kinds of blockchains. One is more like Bitcoin, which is transfer of value, doesn't allow a lot of other protocols to build on top, which has to do with scalability, but we'll talk about later sharp. And then there's other blockchains like Ethereum, that gives you more flexibility or more speed and it's easy To buy is easier to build protocols on top of it, is that correct? Yes.

Alexandre Fuchs:

I mean, if you were to take the real estate analogy, there's like land, you buy land, okay? And the land does the land, and it doesn't do much, but it's land. So you own land, I own land in Louisiana, and I own land in Colorado, whatever it is. And then you have unfinished projects, which have a lot of potential. So you have land plus a foundation. And then people say, Oh, I'm gonna buy that, because I'm going to be able to build on it and do things and have a hotel and have a motel or having a factory or do something. And then they are like finished buildings, or apartments, or whatever it is that you can go and buy, right? That analogy, but it's more or less that. So

Gabriel Riesco:

the first one is Bitcoin.

Alexandre Fuchs:

First one is Bitcoin.

Gabriel Riesco:

And the second one is a theory, the

Alexandre Fuchs:

second one is aetherium. And then the third one would be more advanced chains that do something very specific, that is in a particular way, like an NF. T, for example, would be a good example of a fully finished building that stressed or a statue or whatever it is, it's done. It's not going to change very much. And it can be, you know, as itself not modified very much and, you know, transmitted from person to person,

Gabriel Riesco:

if I'm correct. And I don't know, that's why I'm asking this question. But most of NF T's are built on top of ethereal Yes, yes. Because when you said like there's a third blockchain, it seems like there's actually a third blockchain for NF T's. No, not at all. So okay, sorry. We're still with kinds of blockchains and competition. And there's competitions that are more towards Bitcoin, kind of, I think, projects and the ones that are more ethereal, which we can buy, or build protocols on top of it. Let's

Alexandre Fuchs:

try to describe it in authority. Right? So blockchain is a blockchain. So blockchain has certain rules, and it says into blocks a certain type of information. So Bitcoin has a certain structure for its blockchain. And the theory, we'll have another structure for blockchain. What's the difference? And why does it matter? number of different things. Number one, decentralization. So the idea of all of these blockchains is that in order to function, there has to be copies of the blockchain distributed around the world, all around the world, in many, many, many different places, in order for it to be decentralized, in order to not be centralized. So the difference between all these blockchains and say, to simplify Swift, or any of the rails that exists in the traditional financial system is that there's a bunch of machine guns and people protecting a central server somewhere where all the information is and they're doing everything they possibly can to make sure that that one is secure. The blockchain is secured by the fact that it is blocks after blocks verified, and once a block is adopted, it is photocopied everywhere around the world in all kinds of different places, and has to be you know, so if you're running a node, which has the concept of putting in Bitcoin, you now have a full copy of the ledger in your house.

Gabriel Riesco:

Okay, so let me let me stop you there. Because these were we're getting the the difference between aetherium and Bitcoin. It's the subject of proof of stake versus proof of work. So let's talk about that in you already started, right, do me

Alexandre Fuchs:

a favor, I just want to mention two things. And we're gonna get to proof of state and proof of work. Okay, one second, if you don't mind. So the thing is, the block size, the amount of information you can put in a block dictates how big everything that is distributed around the world is. And there was a big fight four years ago, five years ago on Bitcoin and the specifically decided or the community decided to keep the block size small, which meant that you could not process many transactions per second, you cannot put a lot of complication in it. But the value of that was that, you know, at the size of the Bitcoin blockchain is about 300 gigabytes, meaning that anybody can go and buy a couple $100 PC or even, you know, described running off a Raspberry Pi or anything like that, and have a copy of the full node in their house, if you have something like aetherium, or if you have other blockchains, which allows many 1000 times the size of information, meaning many 1000 times the throughput of transactions, and also allow the complexity of the data to be higher in order to power more services, then the decentralization gets logically a little bit lower. Because what happens is that the investment that you have to make in order to have a copy of the all of the blockchain as a much larger investment, now you need a much larger computer storage space and so on so forth. So to be able to do so.

Gabriel Riesco:

So to kind of to simplify that or, as an example of that, if I myself want to verify the note of Bitcoin, it's 300 gigabytes. It's doable for me just spending like 200 bucks maybe you know, on a piece, so completely agreed to correct one word for me to do that in a blockchain like aetherium which is a Much larger size. Trying to verify the whole node, it would be more of an investment, it would be harder. And that affects the decentralization.

Alexandre Fuchs:

Yes, I agree with everything you said except the word verify. So verification is done by miners. It's a more complex system and you get paid for doing that a node is just keeping a photocopy of the blockchain, in your location on the network.

Gabriel Riesco:

So well, let's let's say I can check it. Yep,

Alexandre Fuchs:

you can check it and you can hold a copy of it to your role as a Bitcoin by?

Gabriel Riesco:

It's hard to do in theory. Exactly. Exactly. For someone like me,

Alexandre Fuchs:

yeah, for the average, the average person and therefore the whole idea, four years ago, during that blockchain size war, was that the most important thing was that the network would be secure. And, and, and resistance to any change by any few people wanted to influence it, because it was so decentralized, and there were copies everywhere, and if you couldn't attack it,

Gabriel Riesco:

so this is basically the difference between proof of stake and proof of work? No, it's different.

Alexandre Fuchs:

Okay, so that's block size, proof of state and proof of work is different. And we can get to that. But just before we get to proof of stake versus proof of work, there's also the concept of the complexity of the information you can store in the block. So in Bitcoin, you can store very little things. It's like I'm oversimplifying, which is like this address sent this amount of Bitcoin to that address done over private keys and some verification all against it. That's what it does. On the Ethereum blockchain, it has been built to store all kinds of other things that allow you to create all kinds of other projects that you can put onto it. But again, it makes it heavier, it doesn't make it slower, but it just makes it heavier and bigger. And, and also, just to make it super simple, simpler code is more robust and resistant, less subject to bugs, just think of anything that is super simple, you know, will probably not break very much stuff we're just trying to do more stuff will break more often. It will also get changed more often and verify more often. So for example, Bitcoin doesn't really get up. I mean, it gets updated, but it doesn't get really updated. There's been taproot, and there's been a bunch of different things that have upgraded it. But it is pretty much the same for a long, long time. aetherium, as we saw in August, just now can change materially in the way that it works. It also has other things. So let's not forget the elephant in the room, which is a Bitcoin has a fixed supply of tokens. Okay, whereas aetherium has a variable supply of tokens, so we can get all that Yeah, that's a different.

Gabriel Riesco:

Yeah, another difference between both of them? So are you ready to do it?

Alexandre Fuchs:

Exactly. You want it so.

Gabriel Riesco:

So

Alexandre Fuchs:

proof of work and proof of steak is is kind of easy if you super simplify it, but the way to go

Gabriel Riesco:

before you explain her, can you tell us which one is which,

Alexandre Fuchs:

of course. So Bitcoin is and probably will always be proof of work. And a theorem is moving towards

Gabriel Riesco:

proof of steak from proof of work. So currently, it's proof of work. Yeah, they're moving to proof of steak.

Unknown:

Yeah. Okay.

Alexandre Fuchs:

So the one thing about it is that So first, we talked about nodes, which was just you have a photocopy of the whole blockchain. So that is, if you want is a free plan of crypto, it's like, you don't get anything for it. You're just being a good participant. And you're adding yourself to the network. And you're like, you know, you're carrying around your your membership card, you have a node, it has a copy of the blockchain you'll but what does that mean? It means that you've run a piece of software, and that software connects to the Bitcoin network, and then make sure that there's yet another copy of the blockchain somewhere else in the world so that if anything were to happen, there's redundancy upon redundancy and redundancy, because of course, if like, if Australia gets cut off, the internet gets cut off or whatever it is, and then gets reconnected A week later, or whatever it is, the whole idea is that Bitcoin will regenerate itself, you know, like a Hydra and recreate whatever it's missed

Gabriel Riesco:

from the network, because everyone has a copy,

Alexandre Fuchs:

because you know, exactly, and wherever it's reachable, it's keeping the most accurate copy anybody that gets shut off, for whatever reason, will just sync back up to where it is, without any chance of, again, you got to believe in this but without any chance of corruption. And therefore, as long as there's one person who has the most valuable, you know, the most recent set of blocks, it will propagate throughout the system. Okay. So that's what nodes are, okay. miners are the people who verify individual blocks. And so the magic of the blockchain, if you want to completely simplify it is that you can trust everything, which is an ambassador has been verified. So now you only have two problems, you need to make sure that you have a copy of the past everywhere. And you have to make sure that you have a proper mechanism in order to validate new transactions. If you have those two things, pretty tough. The Go and attack a system because all the stuff which is in the past doesn't change. And you have a single point, you know, like, you cannot go and change the ownership of something in a central database, that's not how it works, you'd have to create a transaction that would have gotten from one address to another address, whatever you're trying to steal. And all the transactions are now in millions of different places. Right. So now let's look at the validators or the miners, right. They use different words in different chains, but supposedly doing the same thing. They have to use a particular process to get consensus and all agree that these transactions are valid. So a bunch of transactions get filed, right? I want to send you some Bitcoin or some Ethereum or something like that, that comes out on the inbox. And then you've attached your private keys, and I've attached my private keys and all the information is there. And the idea is that again, in a decentralized way, there's a bunch of miners mining pools, you've seen all the videos of computers doing that knowledge and stuff, they have a protocol to try and figure out the the you which transactions are valid or which transactions are nonpareil. Now in proof of work, which is very difficult to accept from the outside, when you think about it, is that your investment in computing power. The hash rates, the amount of effort that you're putting into it is going to determine how much of validity I'm going to give to your calculation or in other ways how much I'm going to reward you for having done the work and how much I'm going to believe what you're going to say. It's kind of nonsense, but the it's kind of really interesting when you think about it. The idea is that if you were to think about the work that you need to do in order to validate the blockchain, it is let's see 100. But now the miners are committing to do 5 billion compared to the 100 of work, extra work, you know, guessing merch, unnecessary work, just pure work in order to say, I am Yvette, I'm validating it. And I have verified and triple verified and quadruple verify the million verified, I'm re verifying and adding all these resources to the network proof of work of the work that I've done, right, in order to participate in the validation. So the problem with that is that just like any economic piece, as the price and so Bitcoin works that way, as the price of bitcoin goes higher than miners can devotes massive amount of energy, just turn on coal, fire plants, and do all this kind of stuff, which is, you know, because it's economical for them to actually do a lot of extra work and say, hey, look, I turn on my lights, I did all this calculation, all this stuff that I did, I really want to be part of this network, I really am doing a good job didn't just see me right, even though they could have done like 100 times less work in order to just verify it, what they're doing is doing extra work, in order to say look at all the effort that I've spent all the money that I've spent all the just energy that I've spent to validate this transaction, and the system is there to reward them for that. And this is one of the key criticisms of the energy usage. And we can talk about all that because it's very interesting. It's not as simple as that. Proof of stake is now a different system where it says I am going to put some assets of mine, I'm going to put a value of mine on on on the chopping block, I'm going to I'm going to take you know 32 eath, I'm going to put this is assessment eath is moving to but that other proof of stake systems work. If I'm going to validate if I'm going to validate transactions, I am going to put value of mine into a pool that if I'm wrong, and if I validate the wrong transaction, or if all the people around you remember, this is happening in parallel, and everybody's checking each other's work, right. And so if in proof of stake in both in both in both in definitely in both because everybody checks themselves also in proof of work. But in proof of stake. That's really important because if other people disagree what I'm so for example, let's say that I'm there, I put in my 32 eath in the pool as staking that I'm putting at risk in case I validate wrong transactions, right? And let's say that I'm trying to steal something. So I'm trying to validate a secret transaction that's going to take this from this money to that money and take it To me and give it to me, when that happens, I could lose much more than the value that I'm trying to steal, or at least I've put capital up, I've put some stake that I have at risk that is essentially protecting the network that if I'm a bad actor, I'm going to be penalized. Right? Now, you would think it's a much better system. Right? You were, it's easy to say that that's, you know, well, the incentives are there, you know, the who would do this, right. But it has multiple things to think about. The first thing is that, first, that means that only wealthy people or wealthy institutions can participate in the validation, which is kind of true in in, in in proof of work. But it wasn't true in the beginning. So in the beginning, anybody could mine now, for sure that's changed, though, that's not a very good argument, but still an argument. But also, you can buy yourself some influence. So for example, you could just decide that you put all the money in the world to try to stake as many of these validators as possible, there's what's called a 50 by 1% attack, which means that you get a majority of the consensus and you overpower the network. Again, we're simplifying. And the idea is that bitcoiners or some people behind Bitcoin prefer, the idea that energy is ultimately almost theoretically, the person who's willing to put the most energy into something should be the person whose opinion you follow the most American, I'm really I'm paraphrasing, and this is all metaphors. But I think it's helpful. Compared to the in there's a lot of criticism that basically the proof of stake is a system, which is very, very much Akin, central banks, financial institutions were only the big institutions get to set the rules amongst themselves. Because for example, who says that the steak should stay at 32? Heath, it could very well go to 32,000 eath. In order to be a validator, there's a number of different things that can happen. That could make it more sorry, less, more, more centralized, less decentralized. So this is a bit different people think different things. You know.

Gabriel Riesco:

So the argument is simplify a little bit. Sure,

Alexandre Fuchs:

yes. Which is helpful.

Gabriel Riesco:

would be correct me if I'm wrong. You know, the proof of work. It's more of a decentralization going towards more decentralized than the proof of stake. Is that is that correct? Or at least as the argument, still different methods? I

Alexandre Fuchs:

think the it's too early to, to know.

Gabriel Riesco:

Okay, but that's the debate. Now, one thing I should point out is thing that proof of work is the way to go because it's more decentralized than proof of stake. Fair enough.

Alexandre Fuchs:

I forgot to mention them. Probably the most important thing, which is the proof of stake obviously requires much less energy, you only do the computation that you need in order to validate the stuff. There's much less brouhaha, there's way less of an energy footprint XRP ripple theory M and so on. so forth, a theorem two, zero, the new version of the theorem is meant to go to that because then what it does is it requires much less energies to power the network. And

Gabriel Riesco:

the outcome of that is that the proof of stake? In a way it's more flexible. He talks. It's also faster, and it takes less energy, is that correct? To build protocols on top of it, or or just actually, the no word of all in a work of all the transactions are fast, let's

Alexandre Fuchs:

super simplified. Bitcoin is super simple to run. It's very robust. It's not very capable. It can do much, many things. It's very decentralized. It is energy intensive. It's particularly integer insensitive when the price goes up. So for example, there's a very interesting thing, which is that it has a limiting factor that as price goes up, energy goes up. If energy goes up, then people's perception of Bitcoin goes down and is viewed badly as we saw when I was a couple of months ago. Ethereum in comparison is way more scalable, can transact many more transactions, you can do many more things on it. But it's more complex, perhaps more buggy. There's some discussion as to whether some bad things have happened recently or not. But it also as many more usages, use it. So it's just two different philosophies. And again, it's difficult to say the The sorry last thing is in. For the longest time in cryptocurrency, there was this concept of Bitcoin dominance that basically, if you want to do anything, you have to go from Bitcoin. And that recently has changed to where Ethereum, much of the chagrin of some BTC maximalists, with aetherium looks to have more usages to more people, which doesn't necessarily mean that it's better. It's just difference, but now it has established itself. And even if you look at the market cap market cap is approaching 50% of Bitcoin. It has grown materially in terms of power.

Gabriel Riesco:

Do you know the exact numbers of the market cap of Bitcoin? And

Alexandre Fuchs:

I look them up and then just

Gabriel Riesco:

know that varies?

Alexandre Fuchs:

I don't that's my No, no, we're crossing over to a trillion dollars on on bigger We're at 950. Today, where was Bitcoin at 50,500, we're at 950 million, a billion dollars on market cap circles. So a trillion dollars, and at 39744 a theory and more at about $466. billion. So we're talking about, you know, again, about 50%. But the important piece, again, is supply and, you know, fixed supply or known increases in Bitcoin at about 2% a year versus unknown maximum potentially changeable in and then with the New London upgrade of aetherium, you're now starting to burn some aetherium. So it's an opportunity for the supply of aetherium to go down as well. So it's kind of a mess.

Gabriel Riesco:

Okay. This is a little weird question, or no, no, unless you add to answer, but it seems that on Bitcoin on the Bitcoin blockchain, as you said, is more difficult to do transactions or other slower or to build protocols on the blockchain itself. And it seems like on if it's faster, correct. So it seems that Bitcoin is building a layer to the lightning work network used to be able to do faster transactions. Is that accurate? Yeah, generally, I

Alexandre Fuchs:

think, and again, I'm not a specialist at all. But my sense is that the efforts to try to build lightning and some other protocols on top of Bitcoin is to try to handle

Gabriel Riesco:

faster transactions, right?

Alexandre Fuchs:

Faster transactions made and smaller ones to many more transactions, which means smaller ones. And there's also some efforts to try to build some projects on top of it, right, but all of which kind of is external truly to the Bitcoin protocol itself. Right? Ethereum is just trying to do it inside the inside, layer to a right on. Its right to be layer one and layer two, if you want to think about it, again, back to the real estate's Bitcoin for sure as a foundation and as a bunch of people trying to build houses on it. Ethereum is more of prefab where you have foundation plus the beginning of a house and then you can build more floors or change the house or do things.

Gabriel Riesco:

Got it. So I think we can actually leave it here for now. And maybe next episode, we can talk more about the data Make sense? That makes sense. Do that. Alright, thanks. So

Alexandre Fuchs:

if you've made it so far, congratulations. I really appreciate you.

Gabriel Riesco:

Thank you all for listening. Thank you, Alex. And we'll see you next episode. Thanks, Bill.