Zuckerberg’s $100B metaverse gamble is ‘super-sized and terrifying,’ shareholder says

October 25, 2022 Coin Telegraph

<div>Zuckerberg's 0B metaverse gamble is 'super-sized and terrifying,' shareholder says</div>

In an open letter, Altimeter Capital's CEO and founder recommended the tech giant cut its Metaverse investments from $10-15 billion a year to $5 billion.

A shareholder’s open letter to Meta CEO Mark Zuckerberg has labeled the tech giant's investment into the Metaverse as “super-sized and terrifying.”

The shareholder has urged the company to scale down its investment in the Metaverse and its related technology arm amid a significant fall in its stock price over the last 18 months.

The open letter was published on Oct. 24 and was directed at Zuckerberg and the board of directors. It was authored by Brad Gerstner, CEO and founder of technology investment firm Altimeter Capital, which owns roughly a 0.11% share in Meta, according to Hedge Follow.

Gerstner said that Meta’s foray into the Metaverse, while important, should not command as much investment from the company as it currently does.

He said the company has announced investments of $10 billion to $15 billion per year into its Metaverse project, including AR/ VR tech and Horizon World, but “may take 10 years to yield results," explaining:

"An estimated $100B+ investment in an unknown future is super-sized and terrifying, even by Silicon Valley standards.”

Rather, he has urged the company to focus more on artificial intelligence (AI) and less on the Metaverse, as it “has the potential to drive more economic productivity than the internet itself.”

“While most companies will struggle to monetize AI, we believe Meta is incredibly well positioned to leverage AI to make all of its existing products better,” he added.

Gestner’s comments come on the same day the Bank of America downgraded Meta from a “buy” to “neutral” valuation, partly due to its Metaverse investments likely to remain an “overhang” on the stock because of the “lack of progress” and “new competition from Apple.”

Gerstner added that over the last 18 months, Meta’s stock has fallen 55% compared to an average of 19% for its “big-tech peers,” which he suggests “mirrors the lost confidence in the company, not just the bad mood of the market.”

Gerstner isn’t the only person to think the future of the Metaverse is a relatively “uncertain” one either.

On Jul. 30, Ethereum co-founder Vitalik Buterin said that while “the Metaverse will happen,” corporate attempts such as those by Facebook will “misfire” because “it’s far too early to know what people actually want.”

The share price for Meta Platforms Inc (META) has plummeted 60.53% over the last year to $129.72 at the time of writing – a far greater fall in the current bear market than the likes of Apple, Amazon and Google.

Meta is set to report its third-quarter 2022 results on Oct. 26.

Mango Market exploiter brags after rug pulling Mango Inu ‘shitcoin’

October 24, 2022 Coin Telegraph

Coin Telegraph

Avraham Eisenberg is at it again, following up his exploit of Mango Markets by deploying a new 'shitcoin' named Mango Inu to purportedly swipe liquidity from bot traders.

In just over a week after pulling off the $117 million exploit of Mango Markets, Avraham Eisenberg is now boasting about making $100,000 rug-pulling a “shitcoin” called Mango Inu, again claiming he "did nothing wrong."

Eisenberg recently ousted himself as one of the persons behind the recent $117 million exploit of the Solana-based decentralized finance (DeFi) platform Mango Markets, which he has also claimed was "legal."

In an Oct. 23 post on Twitter, Eisenberg said the scheme involved deploying a “shitcoin" named Mango Inu, which he suggests was aimed at "exploiting bots" that gobble up newly launched tokens.

Eisenberg said the strategy involved deploying tokens, adding liquidity, and then "rug" right after the bots buy the token.

“Talked to someone who would deploy coins, add liquidity, and rug right after the bots bought, was a good low capacity strat last year when the bots bought anything that moved,” he said.

Much like the Mango Markets exploit, when people on Twitter questioned the morality and legality of the whole ordeal, Eisenberg argued that he hadn’t broken any laws as there was no promotion of the token:

“What part? Mango Inu is definitely not a security (no marketing, etc), no promises were made, just open market liquidity transactions.”

Eisenberg said the token managed to get over $250,000 “invested/gambled” within half an hour with "absolutely no promotion," and that the fact that it occurred meant that "we're still so far away from the bottom."

He also explicitly warned not to buy the token, as "if you buy this you will definitely lose all your money.”

The other day I deployed a shitcoin called Mango Inu and did absolutely no promotion. It got over 250k invested/gambled in like a half hour.

We're still so far away from the bottom.

(to be clear if you buy this you will definitely lose all your money)
— Avraham Eisenberg (@avi_eisen) October 23, 2022

Pointless tokens continue to arise

The Mango Inu token is another example of a token that has gained questionable market takeup recently despite not having any utility — a symptom usually associated with bull markets.

Earlier this month, a memecoin named “THE” token was created in response to a satirical Oct. 14 Twitter post from Ethereum co-founder Vitalik Buterin calling for the creation of an easily shilible project called “The Protocol.”

THE was subsequently launched on Ethereum and the Binance Smart Chain right after Buterin’s tweet, and pumped 77% by Oct. 20, though it has since dropped back down 60% to sit at $0.015 at the time of writing.

The token, which was listed on exchanges such as Uniswap (V3), MEXC Global and Bitget, appears to serve no other function than the actualization of a joke made by Vitalik to foster wild speculation.

Blockchain cybersecurity firm PeckShield has urged caution with this token.

#PeckShieldAlert #THEProtocol PeckShield has detected ~25 $THE are newly created on both Ethereum and BSC
6 out of 25 of these $THE appear to be #honeypot 0x0cbA6 distributed 100M $THE to address Vb (Vitalik)
0x716Fb distributed 6.4M $THE to address vitalik.eth
Be Cautious! pic.twitter.com/nGNhR8kuj7
— PeckShieldAlert (@PeckShieldAlert) October 18, 2022

New Ethereum-Based Altcoin Explodes 119,118% After Vitalik Buterin Jokes About Creation of Crypto Protocol

October 21, 2022 The Daily Hodl

Ethereum solo validators that censor blocks should ‘be tolerated’ — Buterin

October 18, 2022 Coin Telegraph

Censorship

Speaking about a hypothetical scenario, the Ethereum co-founder said censorship should be tolerated depending on the case.

Ethereum co-founder Vitalik Buterin believes that solo validators that choose not to include certain transactions should “be tolerated” to stop the Ethereum community from becoming the “morality police.”

Vitalik Buterin made the comment in reply to a Twitter poll from latetot.eth, discussing a hypothetical scenario whereby a validator censors a transaction that doesn’t align with their beliefs.

The thread, published on Oct. 17, asked what should happen if a solo validator, in a country at war with another, decides not to process a block because it includes donations to the opposing military force.

I’m a solo home validator in Country A. We are at war w Country B, and I decide that I’m not going to include donations to their military when it’s my turn to make a block. This validator should:
— latetot.eth (@latetot) October 16, 2022

According to Ethereum’s co-founder, the answer for a censorship case should be aligned with the level of transgression.

The post attracted notable attention, as Vitalik explained in the thread that any other answer would potentially lead to turning the Ethereum community into morality police:

I would say "be tolerated". Slashing or leaking or socially coordinated anything should only be considered for massive reorging of other people's blocks, not making wrong choices about what to put in your own.

Any other answer risks turning ETH community into morality police
— vitalik.eth (@VitalikButerin) October 17, 2022

In Ethereum proof-of-stake (PoS), validators decide what transactions to include in their blocks if any. PoS is a modern consensus method that powers decentralized finance (DeFi) projects and cryptocurrencies.

Validators are allowed to decide what transactions to include in a block. what we shouldnt do, is encourage staking services like Exchanges or Lido that are so huge and centralized that they can easily be coerced into cencoring by governments or other third party agents.
— mao (@5t4rman) October 17, 2022

Also answering the thread, Martin Köppelmann, co-founder of Gnosis and a long-time Ethereum decentralized application developer, said he agreed with tolerating the validator in that situation while warning about how MEV-boost censorship rising in Ethereum following the Merge.

For the record, in this specific poll, I would also vote for "tolerate". But IMO the quick roll-out of MEV-boost in hindsight was a mistake and should have been done more diligently to prevent a situation where the content curation of 1 entity currently affects 52% of all blocks.
— Martin Köppelmann (@koeppelmann) October 17, 2022

Although the thread discusses a hypothetical scenario, concerns about censorship in the Ethereum network surged last week, with 51% of Ethereum blocks being compliant with the United States Office of Foreign Assets Control (OFAC) standards as of Oct. 14, as MEV-Boost relays take over market share one month after the Merge.

MEV-Boost relays are centralized entities acting as trusted mediators between block producers and builders. All Ethereum PoS validators can outsource their block production to other builders. Due to Ethereum’s upgrade to a PoS consensus, MEV-Boost has been enabled to a more representative distribution of block proposers, rather than a small group of miners under proof-of-work (PoW).

As noted in a recent opinion piece, Slava Demchuk, CEO and co-founder of AMLBot, the Ethereum upgrade could bring modifications in Anti-Money Laundering (AML) and Know Your Customer (KYC) practices in the crypto industry. He stated:

“U.S. regulators are increasingly expressing concerns about the huge sums circulating in DeFi without any control. As the Ethereum blockchain serves as the primary chain for most tokens, its recent shift from PoW to PoS may be used as an argument for their attempts to influence (at least a part of) the decentralized market.”

Vitalik Buterin Reveals Ethereum’s (ETH) End Game, Names Several Big Visions for Future

October 5, 2022 The Daily Hodl

Armstrong, Buterin, Saylor, Star in Coinbase Crypto Documentary

October 4, 2022 The Crypto Briefing

Terra (LUNA) Collapse Big Step Backward for Crypto Decentralization: Ethereum (ETH) Creator Vitalik Buterin

October 2, 2022 The Daily Hodl

Vitalik Buterin Predicts What’s Coming for Ethereum Ecosystem Over Next Two Years

September 26, 2022 The Daily Hodl

Ethereum co-founder Vitalik Buterin defends DAOs against critics

September 21, 2022 Coin Telegraph

Coin Telegraph

Buterin believes collusion and corruption can be minimized when deciding power is in the hands of the entire group, rather than an individual or small minority.

Ethereum co-founder Vitalik Buterin has come out swinging in defense of Decentralized Autonomous Organizations (DAOs), arguing that in some circumstances they can be more efficient and fairer than a traditional corporate structure.

In theory DAOs are collectively owned and managed by their members and have no central leadership. All decisions relating to aspects such as the usage of treasury funds or protocol improvements are made via voting on proposals submitted to the community.

In the lengthy Sept.20 post on his website, Buterin outlined that critics often argue DAO governance is inefficient, that DAO idealists are naïve, and traditional corporate governance structures with boards and CEOs are the optimal methods for making key decisions.

DAOs are not corporations: where decentralization in autonomous organizations mattershttps://t.co/PDh9tIRXcm
— vitalik.eth (@VitalikButerin) September 19, 2022

However, the Ethereum co-founder believes "this position is often wrong" and argues even naive forms of compromise are on average likely to outperform centralized corporate structures in certain situations. Although, he does believe it depends on the decision type which he says fall into two categories; convex and concave.

Examples of convex decisions include pandemic response, military strategy and technology choices in crypto protocols. While concave decisions include judicial matters, public goods funding and tax rates.

"If a decision is concave, we would prefer a compromise, and if it's convex, we would prefer a coin flip," he wrot

According to Buterin when decisions are convex, decentralizing the decision making process can lead to "confusion and low-quality compromises," however when they are concave, "relying on the wisdom of the crowds can give better answers."

"In these cases, DAO-like structures with large amounts of diverse input going into decision-making can make a lot of sense."

DAOs usually embrace decentralization to defend themselves from external attacks and censorship. Due to the nature of the space, and the remote and online nature of some projects, it can be more difficult to “do background checks and informal in-person ‘smell tests’ for character.”

Buterin argues this is exactly why DAOs are necessary, arguing the decentralized world needs to “distribute decision-making power among more deciders, so that each individual decider has less power, and so collusions are more likely to be whistleblown on and revealed.”

He does concede DAOs are not without their issues though. In certain situations, a more centralized structure is required, such as when an organization operates with a central core leadership and has separate groups all working independently.

The core leadership is decentralized, but Buterin says it can be necessary for the individual groups to follow a clear hierarchy, adopting a "clear opinionated perspective guiding decisions."

"A system that was intended to function in a stable and unchanging way around one set of assumptions, when faced with an extreme and unexpected change to those circumstances, does need some kind of brave leader to coordinate a response."

Buterin elaborates further, saying in some cases, DAOs may need the "use of corporate-like forms" to "handle unexpected uncertainty."

He concludes by saying that for some organizations, even in a crypto world that “much simpler and leader-driven forms of governance emphasizing agility are often going to make sense.”

“But this should not distract from the fact that the ecosystem would not survive without some non-corporate decentralized forms keeping the whole thing stable.”

Ethereum co-founder Vitalik Buterin shares vision for layer-3 protocols

September 20, 2022 Coin Telegraph

Coin Telegraph

While layer-2 protocols have been focused on “scalability,” layer-3 protocols would serve a much different purpose, says Ethereum co-founder Vitalik Buterin.

While Ethereum-based layer-2 solutions have been focused on hyperscaling the network, Ethereum co-founder Vitalik Buterin believes layer 3s will serve a far different purpose — providing “customized functionality.”

Buterin shared his thoughts in a Saturday post, providing three “visions” of what layer 3s will be used for in the future.

The Ethereum co-founder said a third layer on the blockchain makes sense only if it provides a different function to layer 2s, which have been used mainly to enhance scaling via zero-knowledge (zk) Rollup technology:

“A three-layer scaling architecture that consists of stacking the same scaling scheme on top of itself generally does not work well. Rollups on top of rollups, where the two layers of rollups use the same technology, certainly do not.”

But, “a three-layer architecture where the second layer and third layer have different purposes, however, can work,” said Buterin.

One of layer 3’s use cases would be what Buterin describes as “customized functionality” — referencing privacy-based applications which would utilize zk proofs to submit privacy-preserving transactions to layer 2.

Another use case would be “customized scaling” for specialized applications that don’t want to use the Ethereum Virtual Machine (EVM) to do computation.

Buterin also said that layer 3 could be used for “weakly-trusted” scaling through Validiums, a zk-proof technology. Buterin said this may be beneficial for “enterprise blockchain” applications by using “a centralized server that runs a validium prover and regularly commits hashes to chain.”

But, Buterin added that it’s still unclear whether layer-3 structures will be more efficient than the current layer-2 model when it comes to building customized applications on Ethereum.

*Layer-2 Vs Layer-3 Network Architecture. Source:* *StarkWare.*

“One possible argument for the three-layer model over the two-layer model is: a three-layer model allows an entire sub-ecosystem to exist within a single rollup, which allows cross-domain operations within that ecosystem to happen very cheaply, without needing to go through the expensive layer 1,” Buterin said.

But, Buterin said that because cross-chain transactions can be executed easily and cheaply between two layer 2s that have committed to the same chain, building layer 3s may not necessarily improve the efficiency of the network.

Buterin’s comments on possible layer 3 use cases come as StarkWare’s newly produced recursive validity proofs appear to have possibly put an end to Ethereum’s scalability concerns.

Declan Fox, the product manager at Ethereum software firm ConsenSys, recently told Cointelegraph that “with recursive rollups and proofs, we theoretically can infinitely scale.”

These recursive proofs have been well tested in production, with StarkWare co-founder Eli-Ben Sasson recently telling Cointelegraph that its recursive proofs have rolled up as many as 600,000 nonfungible token mints in a single transaction on Immutable X and that 60 million transactions could soon be on the cards “with more engineering and tweaking.”

Vitalik Buterin

Pointless tokens continue to arise

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