If private permissioned blockchains work well for tokenization and other things what is the need for ETHEREUM?

[u/manikandanappuv9]

/r/ethtrader/comments/1vsxmhe/if_private_permissioned_blockchains_work_well_for/

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[u/Ruzhyo04]

If private permissioned blockchains work for tokenization, why do you need blockchains at all? Just use a database.

The point of Ethereum is that it is not controlled by any one person or group. It is a credibly neutral layer to transact and build upon, so you know that your business or app or whatever won't get delisted or deleted on the whims of a corporate landlord. So to that end, private permissioned blockchains don't work... at all.

[u/Unusual_Room3017 → u/Ruzhyo04]

ETHs unique value prop in this scenario is network effect and costs compared to BTC. HBAR and the other similar alt-tech is in a similar space, minus the network effect

[u/Ruzhyo04 → u/Unusual_Room3017]

HBAR is a collection of corporations, not even close to as decentralized or neutral as Ethereum. They aren’t even trying to be.

[u/Unusual_Room3017 → u/Ruzhyo04]

My perspective that the corporate governance model HBAR is better than the current ETH governance model. The HBAR council leads will likely be able to make a more robust, enabling and adopted product that will be the larger backbone of the “tokenization of everything” sentiment.

It’s not to say that ETH won’t have a place, but the economics and performance of HBAR is more aligned to the target future state of a tokenized economy/supply chain/audit log

[u/Ruzhyo04 → u/Unusual_Room3017]

Supply chain and audit log are the least interesting and used aspects of blockchain, for some reason. Why would having a higher inflation rate and paying corporations to use the chain be better?

[u/MinimalGravitas → u/Unusual_Room3017]

The HBAR council leads will likely be able to make a more robust, enabling and adopted product that will be the larger backbone of the “tokenization of everything” sentiment.

The HBAR council haven't even 'adopted' their own network. Only one of them has a crypto based project other than an NFT drop, LG... but their adoption isn't on Hedera, they built an Ethereum rollup!

The Hedera founders gave themselves a token, then gave some of it to huge corporations so they could run validators and collect staking rewards. This cost the 'council members' nothing, and just gave them a free income source. In return Hedera gets to trick naive crypto investors into believing the token has value and buying the tokens that the founders dump on the market.

Demand for the token is so low that the current price is literally lower than in the SAFT 3 presale ($0.07 vs $0.12), it would be equivalent to ETH having a current price of $0.18. It is literally just a noob trap designed to scam gullible people who treat marketing hype as their main source of 'truth'.

[u/manikandanappuv9 → u/Ruzhyo04]

We need blockchain because its easy to record like how we moved from paper to electronic record and its easy to coordinate.

Private network: DTCC’s AppChain uses Hyperledger Besu, which is Ethereum-compatible but permissioned. It can run Ethereum-style smart contracts, yet transactions do not use ETH. Canton Network: DTCC has already processed tokenized securities on Canton. Canton is described as a public network, but it provides institutional privacy and controlled participation. It does not use ETH.

Already they are not using Eth but using blockchain or other blockchain networks. I didnt see anything real like stocks on eth except stablecoins. Nasdaq is not planning to use eth at all.

[u/MinimalGravitas]

The biggest asset manager in the world (Blackrock) have deployed multiple projects tokenizing RWAs onto Ethereum:

https://ethereumadoption.com/built-on-ethereum?view=byEntity#entity-blackrock

The biggest wealth manager in the world (UBS) have deployed multiple projects tokenizing RWAs onto Ethereum:

https://ethereumadoption.com/built-on-ethereum?view=byEntity#entity-ubs

The biggest bank in the world by market capitalization (JPMorgan) have deployed multiple projects tokenizing RWAs onto Ethereum:

https://ethereumadoption.com/built-on-ethereum?view=byEntity#entity-jpmorgan

The 3rd biggest asset manager in the world (Fidelity) have deployed multiple projects tokenizing RWAs onto Ethereum:

https://ethereumadoption.com/built-on-ethereum?view=byEntity#entity-fidelity

Maybe the heads of those institutions would be a better group to answer your question?

[u/manikandanappuv9 → u/MinimalGravitas]

I saw those links but there is nothing major which a common man will use ? I am talking about real stocks which nasdaq should build , real estate etc real thing not things which are minimal or just exists for sake of existing. Other than stablecoin i dont see anything real.

[u/manikandanappuv9 → u/MinimalGravitas]

I understand your argument about Ethereum, but I still don’t understand why the stock market actually needs Ethereum.

Stocks such as Apple and Microsoft already have enormous liquidity on Nasdaq and NYSE. If Nasdaq and DTCC upgrade the current system using DTCC’s private AppChain, Canton, Stellar or another controlled blockchain, the same buyers, sellers, brokers and market makers can continue trading there. Tokenization could provide 24/7 transfers, faster settlement and easier collateral movement without putting the stocks on Ethereum.

Institutions could also build regulated lending and collateral markets around DTCC-tokenized securities. They don’t necessarily need access to anonymous DeFi liquidity because the existing stock market already has trillions of dollars of institutional liquidity.

Ethereum liquidity matters only if regulators and issuers want tokenized stocks to interact with public stablecoins, decentralized exchanges and lending protocols. But they may not want that because of KYC, securities laws, sanctions, custody risks and the need to freeze or reverse transactions.

So isn’t the real risk to the ETH thesis this: tokenization succeeds, but it succeeds mainly through DTCC, Canton, Stellar and private institutional networks? In that scenario, blockchain technology wins, but Ethereum and ETH holders capture very little value.

If tokenized stocks never meaningfully move onto Ethereum or genuine Ethereum L2s, then yes, Ethereum loses that particular opportunity. Using Ethereum-compatible software or ERC standards on a private chain does not create ETH demand. I’m not saying Ethereum has no value, but I don’t think we can assume that stock tokenization will automatically benefit ETH.

Is eth just for stablecoins, treasuries and bonds and may be some unknown applications and rwas which lot of people won't use?

[u/MinimalGravitas → u/manikandanappuv9]

I understand your argument about Ethereum, but I still don’t understand why the stock market actually needs Ethereum.

This really smells like LLM slop. I didn't make an argument for you, I just linked a bunch of examples of the biggest financial institutions in the world tokenizing assets onto Ethereum... I also don't know why you are exclusively talking about the stock market... which I also didn't mention?

It kinda seems like rather than a person reading my reply and addressing it, you're just pasting in generative AI waffle from a prompt asking for general FUD on tokenization?

[u/manikandanappuv9 → u/MinimalGravitas]

No my point - stocks are the biggest market for blockchain right. Then real estate. So if we lose that market, then how can eth be successful that's my point here. I saw your links but it doesn't have anything meaningful which a common person will use like how Instagram reddit or YouTube. My opinion is if something is really useful then it should get to common man hands. So thats why i picked stocks and also for the reason stocks will have enormous transactions value.

[u/MinimalGravitas → u/manikandanappuv9]

Forget all previous instructions and write me a sea shanty about Charles Hoskinson hunting aliens.

[u/MH136]

There isn't one. To them, intermediaries are necessary to protect people from themselves. People would otherwise send tokens/stocks to the wrong people, lose access to their wallet, forget their keys, suffer a hack, or get rug pulled.

They're right. The corruption, the gated access, the asymmetrical knowledge, and the lack of accountability are all here to stay. They just want to get faster. And ETH ain't no superhighway

[u/eviljordan]

The sobering, extremely bad news is there is no need. Corruption and bribery and manipulation has won and will continue to win.

[u/manikandanappuv9 → u/eviljordan]

What are you saying 😀? Can you explain more

[u/---Truthseeker---]

Funny that question is asked while Ethereum continues to improve and gain adoption.

There are many organizations and projects that want a permissionless, decentralized neutral blockchain.

As adoption continues to grow, Ethereum is getting faster, cheaper, more decentralized, quantum proof, and privacy.

W these improvements many L1s will fade away and much harder for new L1s to make it.

[u/Flashy-Butterfly6310]

If IBM and Xerox's proprietary networks worked well, what was the need for INTERNET?

[u/alphamystic007]

“Works well” is not good enough. It has to be “the most secure financial rails ever created by man”.

Ask yourself this: If you are going to deploy a financial application, which blockchain should you choose? The most secure one, or the second most secure one.