A Discussion on Ethereum

If one were to compare Ethereum merely to a company, viewing it as a corporation, it would represent a significant misunderstanding of blockchain technology. Ethereum is not just an enterprise or a platform; it embodies a decentralized ecosystem that reflects a new way of social and economic organization.

This means that Ethereum is not a singular entity but rather a network of countless individuals and organizations participating and collaborating together. While many people tend to idolize roles like "king" or "CEO," this actually contradicts the original intent of Satoshi Nakamoto's blockchain design. The true value of Ethereum lies in the collective wisdom and contributions of its community, rather than a centralized decision-making body.

Comparing Ethereum to a company overlooks its decentralized nature. This not only simplifies its operational mechanisms but also neglects the profound impact it has had in innovative fields such as decentralized finance (DeFi). The developments in these areas challenge traditional financial systems and redefine global concepts of trust, value, and ownership.

Of course, any economy will inevitably face unique challenges and obstacles during its development.

Etherism and the Matthew Effect

Etherism will inevitably encounter the issue of the Matthew Effect. This problem is not unique to Etherism; it relates to fundamental issues across all forms of ownership. We can view Ethereum as a form of shared ownership, based on consensus and contribution, representing a decentralized, community-driven public resource rather than traditional private or state ownership.

In simple terms, there is indeed a phenomenon of "the big fish eating the small fish" within Etherism. In the early stages of Etherism, when social resources were relatively abundant and everyone started from a similar point, this system significantly propelled productivity development. Everyone could envision a bright future through investment or effort, as evidenced during the early stages of investment and development where many experienced rapid wealth.

However, as Etherism has entered its mid-development phase, the advantages of scale for large capital have begun to manifest. At this point, individuals with small or no capital clearly feel the pressure from larger capital. For example, Coca-Cola leverages its market share to lower production costs, making it difficult for new entrants to compete in the same market. Absent sudden disasters or industry transformations, large companies are almost impervious. Consequently, any claims of being an "Ethereum killer" appear laughable. Moreover, large companies can also employ "malicious" tactics, such as raising gas fees, to suppress new Layer 1 projects. Many large enterprises expanded their market share and established monopolies through loss-making operations in their early days, which is why many feel that "making money is becoming increasingly difficult."

Despite intense market competition, the overall nature of competition remains relatively "civilized." Although resources are not as abundant as before, most people can still make a living. This is thanks to Vitalik Buterin's commitment to choosing decentralized, community-driven public resources over the traditional private or state models advocated by Charles Hoskinson. "It’s a disgrace to have janitors and CEOs sitting in the same meeting—Charles Hoskinson."

The Later Stages of the Ethereum System

As resources become scarcer, the behavior of large capital begins to appear unseemly. At this point, small fish can no longer be consumed by larger fish, leading to competition among the larger players for resources, thus officially commencing competition among public chains. Those public chains that are both visionary and execution-oriented will gain better development opportunities, typically referred to as Layer 2 projects.

For instance, many feudal dynasties, in their early stages, experienced significant population declines due to wars, allowing both landlords and commoners to own land. However, over time, landlords employed various means to continually seize land. Benevolent methods included acquiring land from farmers forced to sell at low prices due to their inability to withstand natural disasters; malevolent methods involved colluding with government authorities to expand their power through fraud and intimidation.

Regardless of the methods used, the outcomes are often similar: commoners end up owning less land while landlords accumulate more. Over time, landlords form powerful factions that can challenge imperial authority while further exploiting the common people. When disaster strikes and commoners can no longer survive, they often choose to rebel; or when the emperor, facing financial difficulties, seeks to consolidate power, local warlords may also raise the banner of rebellion. These two scenarios often intertwine.

Ultimately, the old dynasty collapses, plunging the common people into dark times for centuries, until a new dynasty rises, and the cycle of history repeats itself. The cyclical nature of history indicates that as long as the various "systems" of human economics remain unchanged, the Matthew Effect will persist. In the tech industry, we have experienced or witnessed this phenomenon countless times. Although this topic may seem distant, we still stand on the early edge of the historical process.

Good Capitalists and Systemic Issues

Many believe that there are good individuals among capitalists or landlords, and this is indeed true. However, the issue of overturning capitalism or the Ethereum system does not rest on the morality of capitalists but rather on the mechanisms of capitalism itself. As Zhang Mazi said to Huang Silang, "Without you, that is what matters most to me." The morality of capitalists is not the key factor. Instead, those with a more inherently benevolent nature may find it easier to shift their thinking, while those with rigid mindsets may struggle to change.

Capitalism and the Creation and Transfer of Wealth

Another critical point is that capitalism or the Ethereum system is not fundamentally aimed at production. Before discussing this, we need to reach a consensus: there are two methods for wealth growth: creation and transfer.

Creation, or production, is the process of enlarging the "cake." In primitive society, people were limited to gathering natural fruits, but with the advent of agricultural society, they began to learn how to cultivate, marking a significant leap in human society.

Transfer, or seizure, encompasses both legitimate and illegitimate forms. For example, earning a profit through trade is a legitimate transfer of wealth, while plundering through war is an act of violent seizure. Overall, wealth transfer is a zero-sum game; an increase in one party's wealth inevitably corresponds to a decrease in another's, thereby intensifying conflict.

Thus, to achieve harmonious social development, it is essential to prioritize the growth of production rather than the transfer of wealth. However, many early Layer 1 projects gradually evolved from the role of "heroes" to "dragons" that transfer wealth during their development. Thanks to Vitalik Buterin's disdain for the phenomenon of "transfer," this issue has resurfaced in some Layer 2 projects.

The Core Purpose of Capitalism

Returning to the discussion on capitalism, its core purpose is to achieve capital appreciation, which is often referred to as the Matthew Effect—wealth accumulation by any means necessary. In the early days of capitalism, capitalists typically focused on production, as the total wealth of society was limited, and rapid wealth accumulation could only be achieved through increased production—what is commonly referred to as "the first pot of gold."

However, once capital accumulates to a certain scale, capitalists often seek shortcuts. While production can generate wealth, the process is slow and labor-intensive. This is where finance comes into play. The most common forms include decentralized exchanges (DEXs) and various lending centers. For instance, I lend you money and charge interest, or I stake in LSDFI or LRTFI to earn interest subsidies. When capital is relatively small, the effect of interest may not be apparent, but when capital scales up, interest can lead to "financial freedom." For example, if you have a wealth of 100 million, you can earn tens of thousands daily just by lying down, without participating in production activities and contributing to the increase of social wealth. Of course, bank interest does not directly create social wealth, but it can indirectly promote production: your loans may assist other enterprises, which, through their production activities, increase social wealth, while you merely collect a portion of the profits.

The Magic of Capital and Social Injustice

However, the concept of "interest" is not limited to lending; other models may be far less legitimate than they appear. For instance, imagine you own ten properties in Manhattan, effortlessly collecting tens of thousands in rent each month, while a promising doctoral student in finance might earn a similar monthly salary. Does this not seem absurd? In a sense, the role of the landlord doesn’t even necessitate a watchdog.

The magic of capital becomes evident here—you can amass wealth comparable to that of highly skilled professionals without lifting a finger. If I were in your position, I might also desire such a comfortable life. Yet, where is the true comfort? It is merely a burden borne silently by others. Behind your state of "lying flat" lies the hard work of countless laborers.

Capital appears to be an endless abyss, attracting numerous heroes and entrepreneurs to plunge in. Take Jack Ma, for example; once an idealist dedicated to "making it easy for everyone to do business," he has now become synonymous with wealth. Many industrialists, after achieving success, have shifted their focus to real estate. If it weren't for the strict regulatory controls on finance, we might already be living in a world dominated by private banks.

Financial Freedom and Entrepreneurial Choices

Once individuals experience the taste of "financial freedom," few are willing to return to the arduous path of entrepreneurship. Therefore, despite many countries striving for years to direct funds toward manufacturing, the results have been minimal. Capital consistently favors areas of "rental income," whether it be real estate, Bitcoin ETFs, Ethereum ETFs, or the stock market—these are the preferred choices for those no longer inclined to labor.

Capitalism and the Suppression of Consumption Power

A significant issue is that capitalism ultimately suppresses consumer power. This is the very question many pose: since the wealthy control 80% of the wealth, why not encourage them to spend?

The reason lies in the fact that a person's wealth can grow infinitely, but their capacity to consume is limited. If wealth cannot circulate in the market, it loses its significance. For example, Vitalik Buterin may eat lobster every day, but that amounts to only 365 meals in a year; he could buy a Mercedes every day, but that totals only 365 cars in a year. Despite potentially earning billions, the amount available for personal consumption would top out at a few hundred million a year. If the rest of the wealth is not injected into the market, it not only fails to create new wealth but may even lose its basic monetary functions—paper currency only holds value in circulation; stacked in a warehouse, it is merely waste paper.

Thus, capitalism can indeed stimulate consumption in its early stages, encouraging people to purchase altcoins, NFTs, and memes. However, as the Matthew Effect becomes evident, large capital ultimately leads to a decline in consumer power. The more Vitalik Buterin earns, the less wealth remains in circulation for the general populace.

The Paradox of Overconsumption

Can Vitalik Buterin engage in overconsumption? Certainly, he could eat a lobster every day and discard another, but this would not invigorate the lobster market. Moreover, the media would start to criticize him for wastefulness. As a public figure, he cannot afford to act in such a manner.

Suppose he buys 100,000 lobsters daily; this would indeed activate the lobster market, but he could not possibly consume them all. How would he handle the leftovers? If he disposed of them, he would find himself in a situation reminiscent of the 33-year milk dumping incident. If he distributed the lobsters to others, wouldn’t that equate to wealth redistribution? What then would be the meaning of the money he worked so hard to earn? It would be better for him to earn less from the outset and share it with everyone.

From the perspective of capital, every capitalist is merely a puppet of capital. This means that once Vitalik Buterin embarks on the path of capital, his sole task becomes the incessant pursuit of wealth, expanding his capital. Even if he personally resists this capitalistic operation, the power of capital and the interests of capitalists drive him forward.

The Matthew Effect and Capital Logic

In an environment characterized by the Matthew Effect, if your capital grows slower than others, you will be consumed by the faster-growing large capital. Therefore, if Vitalik Buterin were to engage in excessive consumption, this behavior would contradict the logic of capital; should he do so, capital would unceremoniously abandon him, replaced by other capitalists.

This is why capitalism has long found itself in such dilemmas. Of course, the spirit of ETHism is rooted in the design of Satoshi Nakamoto, closely aligned with socialist ideals. While we have yet to determine whether socialism can succeed, the path of capitalism ultimately cannot overcome these three obstacles.

The Hopes of Youth and Speculative Frenzy

As 4 billion disillusioned young people around the world seek breakthroughs in the blockchain boom, this may be our only hope in facing the current predicament. However, the result has been a frenzy of speculation, with many engaging in reckless gambles, some even losing everything. This is precisely the scenario the original designers hoped to avoid.

L2 Competition and the Future of Consumption

In summary, competition among Layer 2 projects has commenced, with each exploring different directions. Currently, the most viable path remains the creation of consumption. Therefore, I have chosen #BASE, which aims to bring 1 billion users from off-chain into the blockchain ecosystem, transforming user habits through its decentralized, secure, efficient, and rapid features, thereby revitalizing modern economic scenarios. This potential is compelling; it represents more than just a reaccumulation of wealth—how could you possibly miss out?

Powerful players like Sony, Coinbase, and Kraken have also entered this competition, making the process undoubtedly captivating, showcasing vivid examples of the Matthew Effect. If you choose to stand by and remain uninformed—“unseen, undervalued, misunderstood, and too late”—how can you escape your ultimate fate?

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