Counting the seven deadly sins of Ethereum, who can play the "Rescue Anthem" for it?

Author: Wenser, Odaily Planet Daily

Despite the recent poor performance of Ethereum's market price, Ethereum's "soul leader" Vitalik has already entered the "Next Level."

On September 11, during a conversation with former ENS core contributor Brantly.eth about the value of ENS, Vitalik once again showcased his "rebellious side"—he first crafted a rather sarcastic evaluative tweet, stating, "Look, Mr. Buterin. Here are those who think only PoW is decentralized. Here are those who don't appreciate your support for synthetic wombs. Here are those who don't like vaccines. What happens when they all try to cancel you together?" (Note: The accompanying image is a highly ironic scene from The Simpsons S 11-EP 12 depicting a doctor's diagnosis.) After users on the X platform left a negative comment saying "What A Dck," "Brave Little V" unceremoniously responded: "No, it's a dck," along with an image of a big yellow duck holding a sign that says "PoS is more decentralized than PoW."

It must be said that after the completion of milestone events such as the "10th anniversary" and the approval of Ethereum spot ETFs, Ethereum, as a blockchain network ecosystem with a market capitalization of nearly $284 billion, inevitably begins to face its own "adolescent crisis"—Can the Ethereum ecosystem continue to thrive? What problems currently exist? How to solve the existing problems?

This article approaches the topic from the perspective of the "seven deadly sins" to discuss where Ethereum is headed, for readers' reference. (Note: This article is the first in the series.)

Ethereum also has "Seven Deadly Sins": When price performance is poor, everything said is wrong

Everything starts with "price."

The reason Ethereum has faced criticism from all sides in recent months, even with many loyal supporters of Ethereum speaking out rarely, is due to its weak price performance—on January 1 of this year, the price was around $2,280, and subsequently, Ethereum surged to nearly $4,000 on March 13 as Bitcoin broke new highs. This was followed by the well-known decline, with the price dropping to around $2,223 on September 7, and currently quoted at around $2,360, with an annual increase of only 3.5%.

The current situation can be attributed to the following reasons * (Note: The following "charges" are merely humorous and should not be taken as personal attacks)*:

Coingecko Data interface

First Deadly Sin: Greed—Ethereum Foundation frequently dumping

As the cryptocurrency with the second-largest market capitalization after Bitcoin, a promoter of the ICO boom, and one of the most successful cryptocurrency projects in history, Ethereum has grown into a towering giant in the crypto industry. Along with this, the Ethereum Foundation, as the "official organization," possesses a massive amount of ETH tokens and significant "orthodox" discourse power. However, the Ethereum Foundation has not been as cautious about selling tokens as many had hoped—like traditional equity companies being careful about selling stocks; instead, its "dumping actions" during bull and bear cycles have been the most eye-catching, almost a "must-have operation for gaining presence."

According to LookonChain's previous statistics, as of the end of August this year, the Ethereum Foundation had sold 239,000 ETH since January 1, 2021, amounting to approximately $654 million. Additionally, monitoring by Spot On Chain at the end of August showed that ETH experienced two significant declines in the past month (a total drop of 23.5%). Among them, the Ethereum Foundation alone sold 35,400 ETH (approximately $9.5 million), while still holding 275,000 ETH (approximately $677 million).

Subsequently, the "dumping" continued, with the most recent operation on September 9, when the Ethereum Foundation sold another 450 ETH (worth about $1.03 million). Just this one address has cumulatively sold 3,066 ETH (total value approximately $8.68 million) on-chain over the past eight months, with an average selling price of $2,830.

It must be said that despite the "noble cause" of "supporting ecosystem development," such exaggerated dumping actions still make one sigh: Why is the Ethereum Foundation so greedy?

Ethereum Foundation "dumping" record

Second Deadly Sin: Pride—Ethereum's development route "ordained" and neglecting the living forces of ecological development

Ethereum's journey to today has a certain relationship with the arrogance of the "official forces," including co-founder Vitalik and the Ethereum Foundation, which has a somewhat "success is due to them, failure is also due to them" feeling.

This is specifically reflected not only in the "L2 development route" ordained by Vitalik himself and Ethereum core developers but also in the remarks made during the recently concluded 12th AMA of the Ethereum Foundation. In response to the question during the AMA, "If the blob fails to reach the target average, should we lower the target to ensure price discovery?" Ethereum core researcher Dankrad Feist stated: "Ethereum is currently creating a new market for rollups—the data availability (DA) market. Many alternative solutions hope to take market share from Ethereum—Celestia, Eigenlayer, Avail, etc. But they cannot compete on security, so they hope to compete on price."

For the already flourishing Ethereum ecosystem, it may have always been in a state of "ignoring other chains."

Moreover, Vitalik's own "disregard" for the DeFi track is also a significant reason. He previously expressed concerns about "the use cases of cryptocurrency DeFi," believing that DeFi would lead people to overly pursue financial speculation and speculative value. In response, DeFiance Capital founder and CEO Arthur Cheong stated: "The worst view is that the founder of the largest L1 public chain does not truly understand the use cases and industries that drive ETH's price and make its market cap reach $330 billion. The price of ETH may see $0.03."

Pride may indeed be the original sin of progress.

Arthur publicly diss Vitalik

Third Deadly Sin: Envy—Ethereum Foundation researchers "restaking" themselves

In the still-primitive crypto world, sometimes holding a key position does not mean one can earn a fortune. People need to eat and drink; making money is not shameful.

Perhaps this is also one of the reasons why some Ethereum Foundation researchers choose to "restake" themselves into a specific project—after all, compared to the more academic atmosphere of the Ethereum Foundation, projects that can directly provide salaries and token rewards may be the better choice.

In May this year, Ethereum Foundation researcher Dankrad Feist became an advisor to the Ethereum restaking project EigenLayer, following Justin Drake, emphasizing that "joining in a personal capacity does not represent the Ethereum Foundation, focusing on risks and decentralization." He also stated: "I do receive a lot of tokens from EigenLayer, but I don't think this will change or affect my stance on the core protocol development. If Eigenlayer is completed by highly trustworthy people, it will bring significant benefits to Ethereum. I believe the current leaders intend to do this and plan to help them take responsibility for it. If I believe this is no longer the case, I will not hesitate to speak out and resign."

Listen, what a righteous expression! Even the retreat for progress has been prepared, under the guise of "joining because I believe the project benefits Ethereum; if not, I will resign immediately!"

Fourth Deadly Sin: Wrath—Ethereum Foundation's transparency frequently questioned

The internal management, personnel changes, and expenditure of the Ethereum Foundation have always lacked effective means of display.

As early as 2019, EthHub founder Eric Conner raised "community concerns about the transparency of the Ethereum Foundation." At that time, Ethereum Foundation researcher Justin Drake responded that "the foundation has about 100 employees, with annual expenditures of about $20 million." Vitalik then stated that "questions about Ethereum governance did not delay the development of Ethereum 2.0," which now seems somewhat of a conceptual shift and avoidance of the main issue.

Recently, the Ethereum Foundation's protocol support team added two new employees responsible for funding support work, marking the first recruitment for this team, and the source of this news was a personal tweet from Ethereum core developer Tim Beik.

In August, regarding the Ethereum Foundation's address depositing 35,000 ETH into Kraken, Ethereum Foundation Executive Director Aya Miyaguchi stated, "For a long time this year, they were told not to engage in any funding activities due to complex regulations, which prevented them from sharing plans in advance. Moreover, this transaction does not equate to selling. From now on, they will gradually sell in a planned manner."

Additionally, in such an unpredictable market environment, members of the Ethereum Foundation also struggled to maintain composure—Ethereum Foundation member and Geth development lead Péter Szilágyi previously stated, "I often wonder if I chose the wrong industry?" He believes that compared to SpaceX, the crypto industry is simply a "casino for fools," contributing nothing to humanity. Everyone wants to be the next Vitalik, but no one wants to build something useful; everyone is just thinking about how to extract value. Only Bitcoin attempts (though failed) to become a safe-haven asset; the rest are just selling shovels, with no signs of a gold rush.

To a certain extent, perhaps he harbors disappointment and anger towards the Ethereum ecosystem, aptly described as "grieving for its lack of effort, angry at its misfortune."

Fifth Deadly Sin: Sloth—Ethereum Foundation unable to provide a coherent roadmap and leadership for the ecosystem

This point may be aptly criticized by Zhu Su, founder of Three Arrows Capital—during August, when Ethereum Foundation-related addresses frequently deposited large amounts of ETH into exchanges, he bluntly stated: "Although the Ethereum Foundation sold 30,000 Bitcoins raised when Bitcoin's price fell from $600 to $300, Ethereum still became one of the most successful projects in the crypto space. The problem with the Ethereum Foundation is not the early 'dumping,' but the current inability to provide a coherent roadmap and leadership for the ecosystem."

This can be seen from Vitalik's previous promotion of SBT (soulbound tokens); projects related to the Ethereum ecosystem that were once keen on chasing trends have now become "overgrown with weeds."

Moreover, the statements from Ethereum Foundation personnel are also puzzling: At the end of August, former Ethereum Foundation employee Hudson Jameson stated that the foundation's annual budget of $100 million is not unreasonable, in which he mentioned "salary portion: I do not have the latest data on how many people are 'working' at EF (those receiving regular payments as contractors or employees). If I had to guess, I would say that so far, the number of people in various regions is at least 200, but this is just a guess."

After the Ethereum Foundation's spending came under scrutiny, Ethereum Foundation member Josh Stark also stated that the Ethereum Foundation is about to release the latest report covering 2022 and 2023, expected to be published before Devcon SEA (scheduled for November 12-15 this year).

Regarding the "Ethereum Foundation's annual budget of $100 million," The Daily Gwei founder Anthony Sassano even considered this matter "insignificant" in terms of ETH's market capitalization.

However, in contrast, the Ethereum Foundation's attention to "legal issues" and "privacy issues" may not be as sufficient as we imagine:
In April 2023, Ethereum Foundation researcher Justin Drake revealed that the IP addresses of ETH stakers were monitored as part of a metadata set, which the crypto community viewed as a privacy issue for Ethereum.

In 2019, Ethereum Foundation researcher Vlad Zamfir also issued a clear warning at Devcon 5: developers need to start considering the legal status of Ethereum, rather than merely hoping that the scale of Ethereum's development will grow to the point where the government has to accept it. He believes the government will not allow such a disruptive revolution to happen, and Ethereum now needs to adapt.

Although former Ethereum Foundation employee Hudson Jameson also mentioned earlier that "a key expenditure that the Ethereum Foundation may have overlooked includes global trademark protection legal fees to prevent scammers from using the Ethereum name or logo."

In the recently concluded 12th AMA of the Ethereum Foundation, in response to the question "Where does ETH's value lie today? Has the rollup ecosystem overshadowed ETH, causing it to lose value?" Ethereum Foundation core researcher Dankrad Feist stated: "Ethereum is building a financial platform that will become the most neutral platform to date. It allows for the issuance of financial assets, enables trading of these assets, and can create new financial products based on them without permission, all of which are very valuable activities. Capturing value from this is possible, but the mechanism for achieving it is not yet clear… I personally believe that if we focus on building a value-generating ecosystem on Ethereum, that will be the best, and I think value capture will eventually happen naturally. This does not mean I do not consider it, but focusing on it while the value generation part is still insufficient is a significant mistake…** The highest value transactions will continue to occur on Ethereum L1, while rollups will expand the cake by providing users with enough space to trade on Ethereum."**

In a certain sense, the Ethereum Foundation is also feeling its way across the river.

Sixth Deadly Sin: Gluttony—Ethereum ecosystem's throughput limit has not yet been reached

In response to the same question, Ethereum Foundation core researcher Justin Drake's answer was "more ambitious," as we can sense his ample confidence in the Ethereum ecosystem and development aspirations from his remarks.

He stated: "ETH is money. The accumulation of ETH's value is crucial to Ethereum's success. I believe that if ETH does not become the programmable currency of the internet, Ethereum cannot become the settlement layer of the value internet. The accumulation of ETH's value boils down to traffic and monetary premium. The important metric is total fees, not the fees per transaction. The ultimate goal of Ethereum's success is 10 M tx/s, which can provide billions of dollars in daily revenue even if each transaction fee is less than 1 cent."

In terms of transaction throughput, Ethereum is also a "gluttonous beast."

It is worth mentioning that the Ethereum block explorer Etherscan previously stated that on September 1, despite the Gas prices continuing to decline in recent weeks, Ethereum's daily Gas usage still set a historical high of 109,140.14 M. From this perspective, the Ethereum ecosystem remains one of the most active blockchain networks in today's cryptocurrency industry. This is also indirectly supported by what SlowMist founder Yu Xian said: "The top phishing gangs are rolling in the hottest ecosystem, which is the EVM ecosystem"—after all, only ecosystems with high ecological value and active ecological transactions will attract a large number of phishing attacks.

It can be said that the Ethereum ecosystem's "gluttony" symptoms are still ongoing.

Ethereum's throughput remains astonishing

Seventh Deadly Sin: Lust—Founder Vitalik accused of being infatuated with romance, neglecting his career (humorous version)

First of all, it should be stated that this last deadly sin is not a personal attack, but rather a humorous discussion.

As the co-founder of Ethereum and the "soul leader" of the Ethereum ecosystem, unlike the vanished "Bitcoin creator—Satoshi Nakamoto," Vitalik's every move particularly stirs the hearts of countless people in the cryptocurrency industry: his views are revered as standards, the technical standards he proposes are seen as "ordained routes," and his on-chain operations are regarded as endorsements. Even his personal life and romantic experiences are placed under the magnifying glass of public scrutiny and discussion.

Previously, Vitalik's photos with different girls attracted excessive "concern" from many people. In a sense, for many, Vitalik has become a symbol, and many have developed unrealistic "alternative demands" for him—such as "Vitalik should not date; he should focus on his career," "Vitalik should tweet more to promote Ethereum," and so on.

Image of Vitalik being forced to "promote" Ethereum

Vitalik must also feel quite helpless about this; he previously posted a tweet stating, "Someone told me I need to do less philosophical thinking and post more content that drives Ethereum up, so I’m going to post a bullish post about Ethereum."

In this regard, I can only say that even as the leader of an entity worth hundreds of billions of dollars, Vitalik is still just a person, not a "god," so let’s have fewer expectations and give him more freedom. After all, no one wants their every word and action to be excessively interpreted under the "magnifying glass" of the public.

As for dating, it is his personal freedom; even if it is lust, what is wrong with that?

Suspected dating image of Vitalik (internet image)

Conclusion: Named "Seven Deadly Sins," but actually "Seven Dragon Balls"

Finally, as mentioned earlier, "when price performance is poor, everything said is wrong," Ethereum's "seven deadly sins" seem to be accusations and criticisms, but in reality, what the author wants to convey here is that these issues are more like "seven dragon balls"—once gathered, they can summon the "dragon" to fulfill a wish.

When the Ethereum Foundation and the Ethereum ecosystem can face the existing problems, perhaps we will see a more prosperous and thriving blockchain network ecosystem.

In the next article, we will delve into the more fundamental issues currently facing the Ethereum ecosystem based on the specific details mentioned today.

After the introduction, the main course of this series of articles will follow, so stay tuned.