The Bid to Control Ethereum
The proposal submitted to the Ethereum Foundation would give Musk’s private investment group overall control over the Ethereum network, including majority voting rights. This would allow them to:
- Unilaterally update the Ethereum protocol
- Adjust ETH issuance and staking parameters
This shift in control would mark a massive change for the Ethereum network, opening the door for Musk and his consortium to reshape its structure and functionality.
Musk Moves on Non-Profits
This move on Ethereum follows a similar proposal for OpenAI, where Musk is looking to compel the AI company to adhere to its original non-profit mandate. Analysts have drawn parallels between the two potential acquisitions, highlighting Musk’s interest in “distressed assets” that he believes can be restructured for greater efficiency.
Financial expert Trent Hunter commented: “OpenAI is the world’s most valuable non-profit, and for its bagholders, ETH is the world’s largest non-profit. If Musk is looking to scoop up distressed assets, he should look no further than Ethereum.”
Speculation on Musk’s Plans for Ethereum
While the Musk consortium remains tight-lipped about their plans for Ethereum, rumors have been swirling. Some believe Musk may be interested in converting Ethereum (ETH) into a stablecoin, simplifying its network to enable basic payment functionality. Others speculate that Musk could apply his Department of Government Efficiency model to Ethereum, significantly reducing the number of network validators to a smaller, more centralized group.
Although ETH stakers have expressed concerns about such centralization, financial expert Trent Hunter points out that even with fewer validators, Ethereum would still be more decentralized than other networks like EOS.
“Ethereum Is Not for Sale” – Protest from Validators
In response to the proposed takeover, Ethereum validators have protested by encoding the message “Ethereum is not for sale” into their validated blocks. Ethereum’s founder, Vitalik Buterin, promised a detailed response to the bid. True to his word, he published a 6,000-word blog post titled “Applying Plurality Philosophy to Quadratic Arithmetic.”
Despite this, the Ethereum Foundation has reportedly rejected Musk’s bid, claiming it does not have the authority to approve such a deal. Musk responded swiftly, firing off a series of tweets demanding to know who was in charge of the network. He also threatened to cut off all USAID funding to the Ethereum Foundation, adding further tension to the situation.
Ethereum’s Market Response
The news of Musk’s takeover bid has sparked a rally in Ethereum’s price, with ETH climbing by 1%. This minor increase leaves ETH’s 12-month chart just 48% down compared to Bitcoin, signaling that the market may be reacting positively to the news of potential change.
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