As I understand, the argument: if you have e.g. 10 million dollars of wrapped BTC in an Eth block, and the block reward is in Eth, then as a miner, it might be worth messing with the blocks even though doing so tanks Eth.
This seems suspect to my eye. As a scientist it seems to fail some basic falsifiability tests
First, this not a problem on Etth so far. And the versions of the theory I have heard fail to advance predictions on when it would be a problem. So its either already false (not problem for Eth now) or never will be (b/c its always a future problem)
Second, the theoretical underpinnings seem suspect and closer to a hot take than economic theory. Blocks always carry massively more funds than the rewards anyway no matter the asset. There is always the motivation to cheat. Yes, if the asset in the blocks is BTC and you mess with the bitcoin chain, you would have to cash out before BTC tanks, But futures, swaps, options or w/e make that increasingly possible. Sure, there’s some slippage as the market tanks , but is that 1) large enough to stop someone 2) not large enough for you to profit off of shorting BTC in the process? It seems something means this never works for BTC or multi asset chains. Like maybe tanking the chain makes your ASIC miners worthless. You effectively get slashed.
Again, there’s no answer that can be validated or falsified experimentally here.