A digital bond from Ethereum looks like a fantasy to every ETH fan. However, ETH 2.0 is making a difference in the famous network and will undoubtedly open up many new possibilities. Hence, the convertible potential of the entire $ 26 billion wealth into income assets is very likely.
The concept of a digital bond from Ethereum is similar in many ways to traditional bonds. Stefan Coolican, President of Ether Capital, says that setting it will ultimately bring bond-like properties to the Ethereum blockchain with similar potential benefits. Suddenly, Ethereum’s entire digital bond scenario seems to be possible.
Understanding the possibilities of Ethereum digital binding
Coolican explains that introducing the stake would transform ether from a purely digital commodity into a financial asset capable of paying dividends to its users. The New Age ETH does not bear the counterparty risks associated with a traditional bond, as the shares would be entrusted with the return instead of a counterparty.
1 / We are on the verge of the birth of the Ethereum digital bond.
What does this mean and why is it important? Thread 👇 pic.twitter.com/iUDYH7Gjrc
– Stefan Coolican (@StefanCoolican), July 16, 2020
The staked ETH would most likely represent an intrinsic return value. Interestingly, the risks would be related to the ETH protocol. They would also guarantee users dividends, which in turn would support the value storage concept that the ETH community firmly believes in.
Continue towards ETH 2.0
In addition, implementing the proof-of-stake would drastically reduce the inflation rate to close to zero. Hence, a limited supply to ETH means that it will inherit many of the characteristics of real money.
However, an actual digital bond from Ethereum may not be possible anytime soon. In theory, the smooth ETH trip will run into innumerable problems before the Ether deployment is fully transformed. Critics like the Skale developer Konstantin Kladko warn of errors in the ETH 2.0 layer. He warns that the actual shift towards advocacy for Ethereum may prove embarrassing as ETH lacks the capital for such a transformation phase.
Kladko goes on to elaborate the “fatal flaw”, saying that a one-way bridge means users will tear down 32 ETH to achieve a stakeout. He adds that ETH1 will always be more than ETH2. It remains to be seen how a digital bond of Ethereum can emerge from such challenging reviews.
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