Is This the End of Crypto?
last time we talked about crypto it kind of seemed like the good times would just never end cryptocurrency is going mainstream Fortune famous the Brave crypto.com and then they did it's been a brutal week for crypto investors founder and CEO sandbagging freed has announced his official resignation not only did all these graphs go down but one of the largest crypto platforms went bust when we discovered that the founder was using tons of investors money to fund his other company and not telling anyone totally not okay crypto exchange STX filed for chapter 11 bankruptcy today it's safe to say there were red flags all over as of last week it was worth 32 billion surely it had to be some sort of this is why you're seeing this guy's face all over the news lately he literally lost like over 10 billion dollars overnight so now I feel a bit Vindicated well all of this turmoil has been going down crypto actually had a huge win lately something that no one's really talking about waiting for the murder it really solved one of their biggest problems so that's what I want to focus on today so what happened and is it enough to save the crypto verse let's do this the merge is perhaps the most important update in ethereum's history can you explain it to everyone this is the biggest development of the crypto space most ambitious change today hey before we go on I need to pay my bills and things today's sponsor but now to that please boy do we have something good in store today I'm not going to spoil it but I should say it took an entire day to film this video before we get into it I want to thank today's sponsor which is a service that we're actually using to make this video kind of meta thank you StoryBox for supporting this video check this out crypto farm with StoryBots you pay one set price and then you get unlimited access to all of this stuff there's over a million assets on this website and you can download as much as you want like as much as you want what I like to do is just download a bunch of this stuff test it out in my edit the stuff I use I use the stuff I don't use I'm not charged for all right maybe I don't want footage maybe I want templates like if you're not an animator but you kind of want to be an animator literally you can just download an After Effects template and you're an animator yeah I know how to animate but I secretly use templates all the time it cuts down on hours of work and they just made a plug-in for premiere so you could literally just have storyblocks inside of your video editor you're pulling stuff you're not like going and downloading and moving the file it's all in Premiere I've been using storyblocks for literally a decade well before I was a YouTuber or before they came to sponsor a video because it's seriously the best place to find a bunch of really good stuff for very cheap you pay one set price either annual or monthly that's it there's no hidden fees there's no extra thing and it's a very small price to pay to take back your creative control and to have like access to all of this good stuff so thank you storyblocks for supporting this video for supporting my channel there's a link in my description it's storyblocks.com Johnny Harris clicking that link unsurprisingly helps support this channel but it also allows you to go learn more about how to get in on this amazing service thank you again storyblocks all right let's get into this crypto video we've got a lot to cover okay so before we get into what changed in the crypto verse which is a very big deal let's do a little refresher for those who need it this time with a little bit of a spin hold on a second [Music] welcome to crypto 102. this is really stupid why am I doing this every time I have to explain the blockchain to people I have to do some gimmick to be like I'm going to teach you the blockchain using the simplest version no I'm done I'm not doing it [ __ ] blockchain let's do this if you want to understand why internet money is making the ocean rise all you really have to understand is this [Music] mining Farm it is a warehouse full of specialized computers that have one job and one job only solving math problems [Music] these things are all over the world hell I was in a Swiss bunker a couple weeks ago and the guy I was interviewing had one of these things is this just another way for me to slip in Switzerland to a video that's completely unrelated it totally is any chance I have I will mention my favorite country anyway these machines all over the world are sitting here racing against each other to solve a complicated math puzzle first and if you're the lucky computer that solves one of these complicated puzzles you win the race and that allows you to verify what's called a block which is just a little box of data on the Bitcoin blockchain for example this block is only one megabyte of data it's just big enough to hold like 2 000 transactions that people have made with their cryptocurrency as you publicly verify this block of transactions it gets added to a long chain of a bunch of other blocks that have been verified by the same math puzzle race process and they sort of get strung together into a publicly available totally verified chain of transactions verified by fancy computers that do a bunch of math it is called a blockchain wait no I'm not here to explain the blockchain I'm supposed to be explaining this so why would a bunch of people around the world pay a lot of money to make these big warehouses so that they can verify a math puzzle because if you're the one who owns the computer that successfully solves the math puzzle and verifies the block of transactions you get rewarded in the case of Bitcoin right now you'd get 6.25 Bitcoins which is like I don't know nothing more than a hundred and twenty five thousand dollars so yeah there's a huge incentive for people to build these things and to mine all day for Bitcoin anyway this race to complete math problems uses up a lot of processing power a lot of energy it takes a whole lot of work for your computer to run through all of these computations trying to figure out what the answer is and that's why this method is called proof of work every computer that verifies the transactions on the blockchain has to do a lot of work this is all well and cute until you think through all the energy that goes into building these machines and then you think of the electricity it takes to run them day and night and then you remember that they get really hot when they're running all the time doing these computations so you need to cool them down with AC units and then remember that most of the electricity we use today comes from burning hydrocarbons which releases a nice thick blanket of CO2 into the atmosphere that warms the planet and contributes to the ongoing global warming crisis so yeah that's how the math money makes the ocean rise but that problem may have just been solved ethereum pulls off the murder ethereum just got revamped the second largest blockchain ethereum which is home to the cryptocurrency ether has just completely changed the way that it does the whole crypto electricity math verification thing this isn't just some like changing the code and hitting update this verification process that they change is like the Beating Heart of the blockchain switching it out for something new is like switching out the engine of a car while it's hurling down the road at like 120 miles an hour insanely difficult to do so insanely difficult to do that nobody else has ever dared to try it but ethereum they were like it's worth it for the planet so they start working on this transition for years and years they're tinkering away they're testing it they're perfecting it until September 15 2022 when they finally flipped the switch and [Music] so what happened did it all Crash and Burn and die and the ethereum blockchain is no more did the car go hurtling off the highway without an engine [Music] no actually it went off without a hitch which again for me I'm just like cool good job guys but the thing that blew my mind is this look at this graph I mean look at this graph this is the energy consumption of the ethereum blockchain look at that drop off we're talking about a 99.5 percent drop in power consumption for this blockchain I mean to give you some context here before this transition which they called the merge the ethereum blockchain was consuming the same amount of electricity as the country of Chile it's as if a major developed country was suddenly taken off the planet's Energy bill the CEO of the ethereum blockchain claimed that this one software update has reduced Global power consumption by 0.2 percent which is just like
they did this by changing from the math puzzle race the proof of work race which I had to do to verify all their transactions to a totally different system called proof of stake so now instead of having a bunch of computers Around the World Racing each other all sucking up energy to do this big math race now every computer that wants to verify a block has to put in a stake a small amount of cryptocurrency that then puts you in the running to verify a block sort of like buying a lottery ticket if you want to win the lottery you have to make the money to buy a ticket then through a very complex process that I will not go into here a single random computer is picked to verify that block and take home that sweet sweet commission so no more of these big crypto Farms racing against each other to see who can get there first contributing the most processing power instead it's just one computer during the very light lifting of verifying a block because again it was the racing all of these Machines working simultaneously that used up the power not the verification process itself so there you have it the cryptoverse was saved the power hundred computers were turned offline and the world energy consumption plummeted all over the globe the ice caps stopped melting and the pollution was reduce their lowest levels in 40 years actually that's not what happened at all and the cryptoverse is far from Saved peptic Johnny I didn't know you were going to be here I thought you moved to Tampa I heard you were making another video so I thought I'd stop by can I come in I guess um okay I'm gonna be back crypto Johnny hey I heard you guys were talking about crypto and I'm here to tell you that the cryptoverse might not be totally saved but this is a huge step in the right direction I'm coming in oh gosh why do crypto people always have to be so polarized can we just stay curious about this new technology and just see what happens no no okay fine let's do this again can I at least get some Doritos okay I thought the video was over okay let's do this skeptic Johnny you start I honestly want to hear what you have to say I thought that the merge in this huge proof-of-stake thing was like a huge win for crypto so what's your rebuttal no I mean you're totally right having ethereum switch to proof of stake was a huge deal is a huge deal a completely like that graph that you showed earlier super impressive thank you didn't realize this was gonna be so amicable but let's be clear that this is just one of a million problems facing crypto the crypto space is still Rife with scams and volatility the real reason your little project hasn't taken off yet is because regular old people are way too afraid of losing their money with a cryptocurrency that can be worth 65 000 one month and then a couple months later worth thirty five thousand dollars word wait well that happened to me whoa you invest after the last video when this guy gave his big crypto sermon I was kind of convinced and things were going well and so I went and I bought like a thousand bucks worth of crypto and now it's worth like 300 yeah case and point you and like everyone else who dabbled in crypto you'll make it all back you just need to hold okay but even if he does make it back the volatility of crypto isn't actually its biggest problem if it's not the environment and it's not the volatility which I'm concerned about what is it this ought to be good it turns out that crypto's biggest problem is that guy hey how's it going guys oh God not this guy wait there's more of you what is this I don't do this who the hell is this guy that is Johnny Law and he is hard at work thinking about how to regulate crypto the real existential threat to crypto right now is not volatility or the environment or the lack of adoption it is Regulators No One's Gonna Get that reference unless they had an older brother who was into hip-hop in the 90s hey my brother had that album too love Nate Dogg before you go into the SEC wait hold on let me just finish this thought about the government and Regulators before you can have your rebuttal the fact is we did see some governments Embrace crypto like the government of El Salvador who like made it legal tender at that same time other governments were showing what it looks like when you regulate crypto in China they've outright banned crypto you're not allowed to conduct any kind of transactions in or outside of the country and you're not even allowed to mine it totally banned yeah that's cool but China still accounts for the second most mining activity in the world it's almost as if I don't know the rise of the cryptoverse is inevitable okay governments be damned you may actually get a front row seat to see how Unstoppable the crypto versus is because the United States may be next no no you're getting it all wrong me and the USA we're chill we love crypto in the US it's all about Freedom it's all about doing what you love okay me and Matt Damon were like best friends fortune favors the brave yeah but Matt Damon doesn't pass regulations in the United States the SEC does wait wait I know that one sec Security and Exchange Commission right yes great work the real Johnny's real smart but yes that is correct the SEC is a thing in the United States that is meant to protect investors just don't get it I mean look at this article that I have here from the head of the SEC that wrote it in the Wall Street Journal wait did you actually print off that paper yes I printed it out it helps me read it I'm dyslexic you have an issue with that I didn't I didn't say that dude I'm just subject too and I love printing things especially in Big Font thank you anyway head of the SEC writing in the Wall Street Journal guess how many times he mentions the environment I mean here you look at it does that article mention anything about the environmental concerns of crypto hold on I'm checking here I'll just tell you it doesn't the SEC doesn't care about the environment that's the EPA the SEC cares about one thing protecting Americans from being scammed so yeah it is amazing that the ethereum blockchain was able to get off of its insane energy consumption that is a great step but the cryptoverse is still riddled with the same old problems it's always had the problems that the SEC is rearing to sort out with a bit of good old regulation he calls are being renewed for oversight and legislation from Congress but wait they're not going to like ban crypto in the U.S like this isn't China right ha yes thank you this is all overblown I mean yeah they're not gonna ban it completely you're totally right but they could reclassify crypto as a security instead of a commodity right Johnny Law I mean yeah theoretically I could yeah I'm gonna be honest I don't know what that means basically what this means is that crypto would now be registered with the SEC like ethereum would have to register ether and all other applications with the government yeah that doesn't sound great for the whole untraceable unregulated crypto Utopia philosophy no it doesn't okay okay you've talked with all your nerdy regulation stuff this is 100 speculation there's no proof that they're actually gonna do this and besides even if they do a regulated but still decentralized monetary system is a lot better than a regulated centralized one like the one that we have with banks I am so glad you brought that up oh this is getting good so let's talk about decentralization it's one of the main pillars of the whole crypto project right yeah obviously great then you'll be interested to know that since they did this big merge this big flip to proof of stake almost half of all transactions now happening on the ethereum blockchain are taking place from two addresses only two two addresses so much for decentralized yeah but the fact oh wait I'm not done yet one sec I just need to say one more thing which is all of those Farms that I'm telling you about that are now like defunct and obsolete do you really think those people are just gonna like pack up and go home and be like well we have no use for our like hundreds of expensive computers and Mining farms in Iceland no they're just gonna switch to another blockchain that can use their computers to do the same old thing that they've been doing forever which is mining blockchain through proof of work that energy consumption isn't disappearing it's just being transferred holy [ __ ] sorry sorry but a couple weeks ago I was in Switzerland is there ever going to be a video where you don't mention Switzerland seriously dude no of course not but anyway when I was in that Swiss bunker which was right around the time that this merge was happening it was like the end of September they told me that they were shutting down their mining operation for a little bit just last week he says he's not making money right now so I'll take a break and it must have been because of the merge cool and their next step was to just like destroy all of those really expensive computers and revamp the bunker to be some hip Airbnb is that what their plan was I mean no they're probably just looking for like other blockchains to like use all their Hardware on yeah exactly it was sort of a rhetorical thing I didn't know you were going to actually try to answer the question um it was kind of embarrassing okay I'm gonna cut you off there because it's my turn to speak okay you've been just blabbering this whole time so yes a lot of these miners are moving to other blockchains to use their big mining Farms but this is just the beginning this is early days do you realize all Technologies start out clunky you want to hear my prediction the biggest effect isn't the big graph that goes down to zero of all of its energy consumption it's how it's going to Inspire other blockchains to do the same thing to adopt proof of stake like imagine if the Bitcoin blockchain adopted proof of stake it would change the world it would literally change the world but that's never going to happen Bitcoin has zero plans to switch to proof of stake or any other way of verifying and unlike ethereum which is run like a business they have a CEO they can actually make these decisions top down Bitcoin is this super decentralized project you would need 51 of the users to all agree to switch something this big it's not going to happen anytime soon but they might not have a choice if the rest of this master plan that ethereum has goes as smoothly as the merge then it's going to be more of a case of adapt or die wait a plan what are you talking oh you haven't heard the merge is just the beginning oh man buckle up for this one after the merge we have the surge then The Verge then The Purge then the Splurge really the Splurge why do these tech companies always have to come up with these cutesy naming things The Surge is just the next part of the master plan it involves massively scaling up the ethereum blockchain which is way easier to do now that we have proof of stake verification okay so you're probably asking what would this scaling up even do I actually didn't ask it would mean instead of the ethereum blockchain being able to perform like 20 transactions per second it would be able to perform over a hundred thousand transactions in a second guys this is huge don't even get them started on the verge yada yada yada I feel like this is just another set of empty words to get people excited so they invest in the math money project that you're doing every time we talk about crypto it seems like it always goes to this some like life-changing world-changing technology that's just right around the corner if we all just believe it just feels like yet another stop along the crypto hype train and I'm not here for it okay okay I think I'm gonna call it there guys but Johnny I wanted to talk about The Verge zip it crypto Johnny I'm shutting it down okay we've had enough you can talk about The Verge when initiative I make another one of these videos in like six months because apparently that's what I do now for now let me just say this the merge was indeed an incredible technical feat it was a huge Boon for the environment I mean that graph is insane this is going to be a great thing for the planet no matter what but will it save the crypto verse alone probably not there are way more trials and tribulations to overcome this technology is barely a decade old we don't have to have these strong opinions on either side the reality is none of us know what's gonna happen next so why don't we all just agree to sit back relax and see what happens next nope not gonna happen he says the same thing every time the goods all hold hands and be friends no okay I give up whatever do you guys want to go to beer or something I've actually been super into hard kombucha lately of course you have yeah I actually know a great place down the road let's go okay let's go let's do it foreign [Music]
2022-12-12 01:12
