Op-Ed: Ethereum Passes Its Defining Test with Flying Colors

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Ethereum DAO

Revolt was brewing yesterday morning following Poloniex’s unannounced listing of Ethereum Classic, a clone of Ethereum which continues on the original chain naturally created by Ethereum’s historical hardfork.

The unexpected and sudden announcement gave it a quality of being shocking which allowed such emotions as anger to take charge for a few hours, leading to kneejerk reactions, including threats of a 51% attack against an autonomous chain and people.

Once reason resumed the throne, many concluded that what we had just witnesses was the showcasing of public blockchain’s full power, where minority rights are upheld and there is a free market and free choice for all.

Ethereum Classic (ETC) will now probably be ignored and slowly reach its value of zero as it has as good as no developers, it harbors a thief who controls 14 million eth, it lacks the support of the vast majority of Ethereum’s community and, fundamentally, it is against giving people the exact right ETC currently enjoys, free choice. The exact right that makes their existence even possible.

A New Governance Model

The listing of ETC on Poloniex is, however, a significant moment in the public blockchain space for the rights of individuals who disagreed with the decision were fully upheld and even given a market. They are free now to continue with like-minded individuals in their own chain and compete on equal terms for the hearts and minds of users, developers, companies and the wider world.

This presents a new form of governance which has not existed before and, more interestingly, it combines two forms of governance, thus creating checks and balances. This merging of two thoughts to improve upon either of them on their own has been successfully used in the past and is where the theory of separation of powers comes from:

“Kingship, the earliest government, inevitably becomes corrupt and passes into tyranny. The best men in the community then unseat the tyrant and institute an aristocracy. But their descendants are corrupted by the opportunity to gratify their desires and so become oligarchs. Thereupon the community overthrows the oligarchy and institutes a democracy. Next, the people are debauched by evil leaders, and the collapse of the society brings in a monarch once more.”

The solution was to merge two of them. Public blockchains go further, mixing democracy with the right of each individual or group of individuals to form their own chain and therefore laws/rules. Applied to money this creates a free market that guarantees the rights of property for every individual, but also places the currencies in competition with each other and under the judgment of each individual who can freely choose which one to use.

Ethereum Now Bids for the Mainstream

The different approaches of Ethereum and Bitcoin has allowed the former to gain more and more mindshare and attention as well as backing from rich and powerful entities such as Microsoft and Thomson Reuters as well as VCs, entities that are shunned by some bitcoiners for unarticulated reasons. More importantly, Ethereum’s openness and scientific approach as well as their view that this is just a technology with the monetary aspect being secondary encompassed in Vitalik Buterin’s description of Ethereum’s philosophy as that of “political neutrality” has attracted developers and with them projects creating such a pace that even I, as a reporter, whose job is to keep up, am unable to do so.

This pace is likely to continue as the events of last month and yesterday, in particular, will probably increase confidence in Ethereum as a platform and community for they have passed the most serious test digital currencies have faced so far with flying colors. Moreover, the philosophy of political neutrality is likely to appeal to a far greater number who value incremental improvements and therefore find in Ethereum a familiar home where mainstream values are upheld or improved.

We will therefore probably see a continuation of HackETHons, new projects, events and attraction of new companies and VC capital as the nascent technology proves its strength and welcomes the world to what some say is the future: programmable money and intelligent machines.