Vitalik Buterin, the creator of Ethereum, and Justin Drake, a researcher at Ethereum, spoke about Ethereum 2.0, during the latest Ask Me Anything session on Reddit. The AMA was hosted by the Ethereum Foundation and lasted for over 12 hours, wherein all the members of the Ethereum 2.0 research team answered the community’s questions pertaining to Ethereum 2.0.
Ethereum 2.0 is considered to be the Foundation’s biggest project as it includes some major updates to Ethereum. This upgrade is said to achieve scalability and make the network more efficient. The upgrade from Ethereum to Ethereum 2.0 is called the Serenity phase, aka the final phase of Ethereum 1.0. The key solutions brought by Serenity include Proof-of-Stake [PoS] – Beacon and Casper, Sharding, eWASM, Plasma, Raiden, and zero-knowledge proofs. Vitalik Buterin had previously claimed that Serenity is the world computer, which is a combination of different features that the team has been discussing for the past few years.
During the AMA session, the team was asked about what the best response would be to a developer, who is hesitant about building on Ethereum today, taking into consideration that Ethereum 2.0 will take over in the next few years. This question was asked by a Redditor, 0xStark.
To this, Buterin stated that after the state and execution model for Serenity solidifies, the team would be working with the developer community, wherein they would be focusing on modifications to high-level languages such as Solidity, and Vyper.
“Hopefully at that point it will become clearer how to build applications in such a way that they could be redeployed as-is on the 2.0 chain. At least that’s my hope.”
Justin Drake also replied to the question, wherein he stated:
“Building on Ethereum 1.0 today is great for learning and prototyping. It’s also great for assembling a culturally-aligned team consistent with the philosophy of the Ethereum community (which may be different than the philosophy of the Bitcoin, Ripple, Bitcoin Cash, EOS, Tether, etc. communities).”
Furthermore, another Redditor, Elizabeth Giovanni asked the researchers whether there were any economists being consulted to help decide the issuance rate of a full Proof-of-Stake system [PoS], and the effects certain decisions would have on the network and the community, both in the long-run and short-term. Here, Vitalik Buterin said:
“Personally at this point the feedback I’m most interested in is actually feedback from potential stakers. The main question basically being, are there any other tweaks we can make to the economics that, given a fixed level of reward, will (i) encourage more people to validate, and (ii) encourage many small solo validators or smaller pools, as opposed to a few large pools.”
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Coin Metrics data reveals inaccuracies in Kik’s claim of being as dominant as BTC, ETH blockchains
Upon investigating Kik’s claims in response to SEC’s lawsuit filed earlier this month, CoinMetric data reported inconsistencies in the on-chain activity and adoption rate of its native token, Kin.
In a study dubbed, “An Analysis of Kin’s On-Chain Activity,” the crypto-asset elaborated on the two assertions made by Kik in its letter to the US Securities and Exchange Commission.
Kik’s first claim was regarding its blockchain activity. Its in-house token, Kin, supposedly exceeded Ether and Bitcoin to record the fifth highest daily blockchain activity. This was debunked by CoinMetric’s investigation after taking into account its “Operation Count” [the same metric used by Kik to support their claim] and “Transfer Value.”
In terms of the Operation Count, the report explained,
“According to Kik’s source for the metric, “blockchain activity” is defined as “the number of operations on the blockchain in the last 24 hours.” Operations are broadly defined as any type of action that could be recorded on chain. But operations are not standardized across blockchains which makes comparing across chains difficult.”
Besides, drawing parallel comparisons across blockchains with radically different use cases and operations is difficult.
Although Kik’s original research showed a high number of account creations, Coin Metrics data revealed that many of these accounts were empty.
Additionally, Kin’s “create account” operation has a fee of .001 Kin. The report highlighted that a metric such as “operations count” for the purpose of blockchain activity cannot be used as a measurement tool since Bitcoin and Ethereum blockchains do not track account creations on-chain.
In terms of Transfer of Value, the report elaborated,
“Theoretically, high daily transfer value should signify high activity. But transfer value is often quite noisy, especially on low fee blockchains where there are minimal costs to sending transactions. Some transfers might simply be users moving money around between addresses they own”
Instead, Coin Metrics contrived “adjusted transfer value” metric to eliminate what it called, “noise and certain artifacts like self-sends, or deliberate spammy behavior.” Coin Metric noted that this gives a clearer picture of the on-chain activity, resulting in a decreased transfer value when compared to other blockchains, even if it had a high number of daily blockchain operations.
Additionally, Kin’s average transaction value was also low, when compared to other blockchains. For the first claim, Coin Metrics concluded that the Kin platform had more micro-transactions than Bitcoin and other dominant blockchains, while highlighting the fact that the latter blockchains are not primarily used for such transactions.
Regarding Kik’s second claim that said that over 300,000 users were earning and spending Kin as a currency, Coin Metrics assessed its blockchain usage. The number of addresses is not necessarily equal to the number of users since a single user could have multiple addresses. Hence, Coin Metrics took the number of active users into account, which the report defined as “the number of unique addresses that were active in the network [either as a recipient or originator of a ledger change] during that day.” The report noted,
“Kin 2 has significantly more originating active addresses than Kin 3. Although Kin is in the process of migrating to Kin 3, it appears that Kik is using data from the Kin 2 chain to support their claims about usage.”
Further, Kin 2 and Kin 3 had more active addresses that received payments than originated payments, which meant that there were more “earners” on Kin than “spenders,” also noting that only 35,000 addresses held over 10,000 kin [nearly $0.23]. The report added that the figures are lower than other blockchains which have a minimum of 1,000,000 addresses with at least $1.
After examining multiple critical aspects, Coin Metrics concluded that Kin fell below dominant blockchains in terms of daily active addresses, despite maintaining steady growth. It said,
“A majority of Kin’s active addresses have small account balances. While this makes sense for a network built around micropayments, when viewed across multiple metrics, our data show that Kin is not more widely used than dominant chains such as Bitcoin or Ethereum.”
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