TL; DR
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If Ethereum wants to scale AND continue to hold the title of “Ultra Sound Money,” it needs to move from the Bloomingdales model to the Walmart model.
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When Ethereum’s transaction speed drops (as it has recently), the supply of ETH actually goes up, decreasing its overall value.
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So, to remain “ultra healthy,” Ethereum must become the Walmart of crypto: instead of processing a small number of global monetary transactions at high fees (anywhere from $3 to 3,000), the ETH network must move to high transaction volumes. with super low costs.
Full story
Bloomingdale’s 2022 sales = $2.8 billion. Bloomingdale’s model = selling expensive items, in low volumes.
Walmart’s 2022 sales = $573 billion. Walmart’s model = sell cheap items, in high volumes.
If Ethereum wants to scale AND continue to hold the title of “Ultra Sound Money,” it needs to move from the Bloomingdales model to the Walmart model.
Confused? This is what we’re talking about:
A certain amount of new Ethereum is created each month, with no limit on how much can be created in total over time.
To combat this constant inflation rate, every time an Ethereum transaction is made, a portion of each fee is wiped out.
The more ETH transactions are made → the higher the transaction fees become → the more ETH is burned.
…the idea is that the total amount of Ethereum will actually be that decrease over time, as more people start using it (earning it the title ‘Ultra Sound Money’).
The only problem is…
When Ethereum’s transaction speed drops (as it has recently), the supply of ETH actually goes up, decreasing its overall value.
To remain ‘ultra healthy’, Ethereum must become the Walmart of crypto:
Instead of processing a small number of global monetary transactions at high fees (anywhere from $3 to 3000), the ETH network needs to move to high transaction volumes, with ultra-low fees.
Step 1: Ensure low fees regardless of current transaction volume.
(Because no one will join a global monetary network that charges $3-$3000 each in fees).