Dear @LLFourn, I’ve read your thoughtful article, which I appreciate. However, you’ve misunderstood and over-simplified a few of my points and made a few inaccurate assumptions. I know you’re intentions are good so this isn’t intended to ignite any major debates; plus, I don’t have a lot of time for debate anymore because it’s clear the team has no interest in engaging the community on this issue, but a few comments are warranted.
From your article:
There are no paradoxes in life. What humans perceive as a paradox is actually just a collision with our own ignorance. In this case, there is no contradiction if you truly understand my point: A system can be intended to be trust-less, but a flaw in the system’s implementation can thwart its actual trustworthiness. More specifically:
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The technical integrity and trustworthiness of a blockchain is undermined when the 50%+1 attack risk exists (and it does in this case).
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The integrity and trustworthiness of a crypto market and corresponding economy is undermined when the concentration of crypto wealth gives whales enough power to manipulate the market (as proven below).
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The integrity and trustworthiness of a blockchain’s political governance (i.e., technical development decisions, project voting, PR strategies, minting rewards algorithms, allocation of scarce team resources, crisis management strategies, regulatory and government relations strategies. . . . ) is undermined when a non-trivial portion of the community has reasonable doubts about the long-term viability of the project and/or the integrity of its crypto market due to the preceding two vulnerabilities.
Thus, on every meaningful level–technical, market, and political–a high concentration of wealth in any economic/market system completely undermines the integrity of that system. In response to these points, there are two general good-faith responses:
- “We trust the team and whales; so don’t worry, be happy and enjoy the ride.”
OR
- “We love the team, but the high ADA concentration has many unintended long-term consequences that represent real risks to the viability of our project and community; therefore, we should take these concerns seriously and do everything possible to resolve these problems ASAP.”
The people who take your position have chosen the first option. I’ve lived long enough to know that option just kicks the can down the road. So, I choose the second option.
Yes, it certainly does. Have you ever worked on Wall Street? In Canary Wharf in London? Have you ever lived in the U.A.E., Saudi Arabia, Mexico, Russia, DRC, or any country in which the financial system is blatantly dominated and controlled by whales? Did you see how less than 10 people who substantially controlled over 70% of all the wealth within the American economy were able to dictate to over 300 million Americans that their taxes would be used to bailout the banks in 2008? How did they get that power and leverage over the entire ecosystem? They controlled the wealth because they controlled the laws that govern the way the system works; that’s the nexus of politics and economics. Controlling the flow of capital within a consortium of banks and/or as a consortium of whales certainly does give you the power to control an entire economy.
In fact, in this case we already see the whales manipulating the ADA market quite frequently with their sell- and buy-walls.
SELL-WALL:
BUY-WALL:
Bear Raid Attacks. When whales have the power to deliberately or inadvertently distort markets (See also this BTC whale caught on video.), unsuspecting crypto holders have no idea why the value of their crypto holdings suddenly collapses. During these market collapses, whales profit from their sell orders; then they can gobble up even more currency after they cause the market price to plunge. Then, that creates a buy-wall, which pushes the price back up rapidly, giving them an opportunity to pump the price up until they’re ready to dump another huge load of crypto into the market. In securities trading, this illegal strategy is called a “Bear Market Raid.” Regardless of its legality, this strategy is only possible when a market is dominated by a relatively small number of whales. And a small number of whales can only dominate a market when the distribution is highly concentrated.
These are market failures, not the mechanics of a free market. Market failures are fundamentally spawned by dysfunctional monetary and regulatory policies. In crypto markets, these market failures are the direct result of extremely high concentrations of crypto wealth in the hands of a few, which is the direct result of poorly executed ICOs and monetary policies.
The people who have debated against my position on this issue have ignored many aspects of economics and politics in the real world, including the past decade of crypto politics in the real world. I’ve already written extensively in many threads about these dynamics so I’m not going to repeat them anymore.
Of course, I never said “greedy narrow minded whales” anywhere, nor did I ever even insinuate that. My position has always been based on a capital structure argument, not a moral or personal attack against the whales. It’s nearly impossible to have a rational, good-faith debate when people make so many false assumptions about my position. Even somebody as sincere and thoughtful as you can’t resist twisting my words. 
This is why I stopped engaging most of the people who were debating me.
There were probably a dozen other comments in your article that misrepresented my position and/or over-simplified my statements and/or were technically inaccurate from a formal economics perspective, but my intention is not to get sucked into any more debates; so, I’m moving on.
Bottom Line: Some people prefer to hope for the best and not worry about problems until they arise. They may also be exhausted from debating or they might prefer to avoid controversial debates to avoid impacting the value of their ADA holdings. I can understand all those things, but these problems won’t go away. So, rather than waste time debating people who don’t want to see the problems, it’s more productive to spend my time working on projects to help reduce the impact of these problems. Over time I may share more about these projects, but in the meantime, I wish you the best.
(Again, I really did appreciate your thoughtful article, even though it misrepresented many of my statements.)