Why is Ether so popular, despite its infinite supply?

[ndnh]

Can someone educate me the deep interest with Ether? I understand that it has an infinite supply but the supply is controlled based on rising difficulty. One advantage of Ether is its use for smart contracts, and usage ensures demand which could cause prices to rise.

But Bitcoins have a finite supply (unless the code changes) and its first mover advantage allows it to gain proper market share and ensure its demand, and with its limited supply, theoretically, prices should go up. However, if users were to hoard Bitcoins and there is no usage (delayed expenditure) which leads to low-demand, Bitcoins will devalue.

I'm confused. Resident economists, please enlighten me.

Infinite supply is better than finite supply, that is why many alts (like DOGE) are going for that. The price doesn't have much to do with it. Price is based on the speculation that the technology (smart contracts, blockchain, etc.) is worth x.

Bitcoin and Ethereum aren't competitors. They are made to do altogether different things. If Bitcoin goes down soon, Eth would most probably go down with it.

Prices doesn't works on theory here. Just on what some whales think...


Hoarding generally and theoretically limits supply without compromising on demand and causes prices to rise.


Disclosure: I hold Bitcoin, Ethereum and a little Lisk.

[johnyj]

Mathematical wise, the inflation rate will all drop to close to zero regardless of constant supply or limited total supply, so if you have a little bit mathematical knowledge then you know they are essentially the same inflation wise

Of course limited total supply will create much higher potential for value gain, but you can always change a coin to limited total supply later when it gained enough market traction, which ethereum is striving for

[biggbox]

because it's fast and the people wants a "normal" e-currency with instant transactions.

This. It is literally that simple - people just want something that works well.

yes we all want something better that now,bitcoin have many problem on transaction or supply,or maybe price. but,have you think etherum will answer all bitcoin problem?or etherum just gonna be one of many crypto that have cheap price under bitcoin?

Because of the quick blocks, they arn't going to experience network congestion. Yesterday there was a period where just one bitcoin block was found in an hour, which increased the backlog. With Ether making blocks practically every minute it's not going to happen to them. And all the end user cares about is whether something works. They don't want to hear excuses or explanations about why their transaction hasn't gone through. They just want stuff to work.

So what is going on with the development or the push for Bitcoin thunder network now? The last I read, the thunder network is going to try resolve the problem of network confirmation.

It is too little too late. The lightning network is a last ditch attempt to save Bitcoin. I am simply not convinced it will come out early enough and even if it magically gets released next 3 months it will have a slow adoption curve. At the same time, ETH is making incredible progress not just as a currency but in all sorts of areas.

This risks that Bitcoin will drop in half are considerable and thats a risk I am not willing to take when there are coins with a more promising future.

The last code check in is 7 days ago. At least it's moving. lol.

https://github.com/blockchain/thunder

[Cuidler]

But what is stopping Chinese Ether miners from taking over half the world's processing power, all over again? They have access to cheaper raw materials, cheaper power to mine Ether.

The fact that they cant do that due to PoS. With PoS, only stakeholders can participate in the staking process and earn fees on the network. ETH stakeholders are spread throughout the world as it should be.

ETH is proof of work today, not proof of stake. But the fact is most coins are distributed from initial IPO sale - terrible distribution and even before going to proof of stake, not much % of coins is going to be distributed from much fairer proof of work - most coins simply ends distributed from initial IPO sale to dump to naive today buyers or dominate proof of stake era.

[fanatic26]

ETH is proof of work today, not proof of stake. But the fact is most coins are distributed from initial IPO sale - terrible distribution and even before going to proof of stake, not much % of coins is going to be distributed from much fairer proof of work - most coins simply ends distributed from initial IPO sale to dump to naive today buyers or dominate proof of stake era.

^^^^ At least someone understands whats actually going on with ETH.


P.S. If ETH is so much better than BTC can anyone link me to something ACTUALLY using ETH that matters? Where are these bitcoin killer apps and contracts?

[tonlong]

But what is stopping Chinese Ether miners from taking over half the world's processing power, all over again? They have access to cheaper raw materials, cheaper power to mine Ether.

The fact that they cant do that due to PoS. With PoS, only stakeholders can participate in the staking process and earn fees on the network. ETH stakeholders are spread throughout the world as it should be.

ETH is proof of work today, not proof of stake. But the fact is most coins are distributed from initial IPO sale - terrible distribution and even before going to proof of stake, not much % of coins is going to be distributed from much fairer proof of work - most coins simply ends distributed from initial IPO sale to dump to naive today buyers or dominate proof of stake era.

The price of something is determined by two factors: supply and demand. We know the supply increases by a certain amount every year. But, if the demand increases just as much, then the relation of supply over demand will remain constant, and the price will remain constant.

[biggbox]

Can anyone comment on the fact that the main Ether chain will be too large for practical applications?

[cjmoles]

I don't see any references to how the "gas" charges affect the ether supply in this thread.  Once the platform adopts a proof of stake system and discards the proof of work system, won't the ether supply diminish somewhat as more D'Apps come online?

[bitwhizz]

Gas?

[biggbox]

I've read in another discussion that the ETH core team are not very well versed in handling finances. I am unsure what this holds for ETH in the future. If a whole dev team is unable to come up with a good financial plan to chart the future of their own project, I am a little doubtful of their vision.

[manselr]

Gold s infinitive as well, at least in our lifetimes, yet, the price s stable and even going up. Why?

You can't compare gold's legendary network effect with some altcoin... that is delusional. Bitcoin can do everything eth can do with sidechains, eth can't do what Bitcoin can do since its turin complete. Honestly I think eth is doomed long term. Still a good idea to hold some for p'n'd sake.

[stoat]

Gold s infinitive as well, at least in our lifetimes, yet, the price s stable and even going up. Why?

You can't compare gold's legendary network effect with some altcoin... that is delusional. Bitcoin can do everything eth can do with sidechains, eth can't do what Bitcoin can do since its turin complete. Honestly I think eth is doomed long term. Still a good idea to hold some for p'n'd sake.

Will you still be saying this when ETH market cap is at 10billion?