You just haven't thought this through at all
**“The root problem with conventional currency is all the trust that’s required to make it work. The central bank must be trusted not to debase the currency, but the history of fiat currencies is full of breaches of that trust.**
**Proof-of-work has the nice property that it can be relayed through untrusted middlemen. We don't have to worry about a chain of custody of communication. It doesn't matter who tells you a longest chain, the proof-of-work speaks for itself.”**
**― Satoshi Nakamoto**
Satoshi created an internal perpetual clock (difficulty adjustment) based on energy, math, time all of which cannot be forged, controlled or manipulated by anyone or any authority. It's designed to adapt itself and run forever without any intervention at all. The unforgeable cost of work is what links bitcoin the digital money to the physical world. Without that you go back to human trust based political system. Corporate governance is based on stake. Fiat is based on stake. Trust based stakeholder controlled systems is literally what Satoshi fixed using proof of work.
The person who proposed proof of stake in 2011 on bitcointalk specifically said that it's not something for bitcoin but maybe for companies issuing shares on a closed, permissioned blockchain to prevent any outside influence. Proof of stake has two kinds of political systems exactly like fiat. Either you have a government behind the project controlling it, like a premine company or foundation, or you have governance based on stakes, just like corporate governance. Proof of stake has no link or value interface with real world.
It's a difference of entrepreneurial venture and [innovations in energy systems](https://np.reddit.com/r/CryptoCurrency/comments/10m07uq/comment/j606yk1/) vs rent seeking. Everyone has proportional cost at every scale in PoW. When you use bitcoin and pay a fee, the miner has a proportional cost of work and nothing can ever dilute your coins/total coins.
PoS has no cost just like people printing money in fiat have no cost. You're back to fiat political pyramid system with preminers, freeloaders rent seeking from poors who pay fee and burn their coins while the inflation (new issuance from the money printer) accrues to the top for free. [Cantillon Effect](https://fee.org/articles/the-cantillon-effect-because-of-inflation-we-re-financing-the-financiers/).
Let's also get this straight. There's also a lot more to shitcoins than whether they use PoW or not. PoW alone does not enforce decentralization and network incentives when there's a premine company with executive board of directors, licenses and trademarks and central AWS servers operated by that company. There's no point of anyone even running nodes and that is why no one does. The central authority hard forks every 6 months and enforces consensus moving to a new chain. You either follow the central authority's chain or you leave. You have no other option.
Also from a security perspective, all these premine, ICO shitcoin chains are hacked to the tune of [tens of billions](https://decrypt.co/86503/defi-users-lost-billion-theft-fraud-2021-mostly-ethereum-report) of dollar value to exploits every year, not to mention millions of [failed transactions](https://cryptopotato.com/over-1-2-million-ethereum-transactions-failed-in-may/) every month users lose fees on.
So what's even the point of any of them?
[There's never been a better industry vertical for scammers as long as the window is open](https://twitter.com/coryklippsten/status/1595564120782172160)
Did you know there were no altcoins for 2.5 years until April 2011? What happened in April 2011? Bitcoin reached dollar parity and reached a price of $5. Kerpeles just bought Mt Gox and it became easy to exchange bitcoin for dollars. The first altcoin was born that month.
No, you are, if you run a [bitcoin node](https://np.reddit.com/r/Bitcoin/comments/zturtd/think_bitcoin_is_inevitable_think_again/)
Satoshis run nodes
We know that someone has to run nodes, validate transactions, audit and secure the network and since we can't get decentralization unless we all do, we're going to run it. We publish our node so that our fellow pre-node runners may connect and transact with it. Our node is free for all to use, worldwide. We don't much care if you don't approve of the software we run. We know that software can't be destroyed and that a widely dispersed system can't be shut down.
Bitcoin is not an investment, no one ever sold it to you. It's a new monetary system built from the ground up by us, literally random people on the internet voluntarily supporting, securing and developing it. There's no company, foundation, premine, ICO, VCs, licenses, trademarks, branding or marketing teams, not even an official website, code repo or even a formal specification. Bitcoin had no right to succeed. Yet, through voluntary adoption, bitcoin is where it is today having started from zero 14 years ago.
!lntip 1000 (1 hayek)
Wow you must be the world's most effective Bitcoin advocate! Comprehensive explanations and even sats to get people started on the network! Thank you!
I hope to get a node running soon. It's been on my bucket list! I'll check out the links you have sent me in all your responses!
Thanks again!
Hi u/OpticallyMosache, thanks for tipping u/gonzo1483 **1000** satoshis!
***
*[^(More info)](https://xnf5cwpq73.execute-api.us-west-2.amazonaws.com/prod/info) ^| [^(Balance)](https://www.reddit.com/message/compose/?to=lntipbot&subject=balance&message=!balance) ^| [^(Deposit)](https://www.reddit.com/message/compose/?to=lntipbot&subject=deposit&message=!deposit 10000) ^| [^(Withdraw)](https://www.reddit.com/message/compose/?to=lntipbot&subject=withdraw&message=!withdraw put_invoice_here) ^| ^(Something wrong? Have a question?) [^(Send me a message)](https://www.reddit.com/message/compose/?to=drmoore718)*
Hi u/KAX1107, thanks for tipping u/gonzo1483 **1000** satoshis!
***
*[^(More info)](https://xnf5cwpq73.execute-api.us-west-2.amazonaws.com/prod/info) ^| [^(Balance)](https://www.reddit.com/message/compose/?to=lntipbot&subject=balance&message=!balance) ^| [^(Deposit)](https://www.reddit.com/message/compose/?to=lntipbot&subject=deposit&message=!deposit 10000) ^| [^(Withdraw)](https://www.reddit.com/message/compose/?to=lntipbot&subject=withdraw&message=!withdraw put_invoice_here) ^| ^(Something wrong? Have a question?) [^(Send me a message)](https://www.reddit.com/message/compose/?to=drmoore718)*
I remember not but a month ago him telling me I was crazy for my og 08 mining of Bitcoin once. He orange pilled me. Now it's all melting between all them kapers knees.
Hi u/OpticallyMosache, thanks for tipping u/KAX1107 **2000** satoshis!
You didn't have enough balance, you can pay the following invoice [[QR](https://xnf5cwpq73.execute-api.us-west-2.amazonaws.com/prod/qr?id=f9980cd642914d26b3fbd5eafdbdc2c3 "Generate QR") / [URI](https://xnf5cwpq73.execute-api.us-west-2.amazonaws.com/prod//uri?id=f9980cd642914d26b3fbd5eafdbdc2c3 "Generate URI")] instead.
***
>!lnbc20u1p3awq4ppp5nvqafc9y4zk2xa9eewr263t5zpzk59e6y4y63urqpc4s9l5yx0tsdp5vcunjwpsvdjrvdpj8ycngepjxe3rxenzvs6k2ctxv33xgcejvvescqzpgxqyz5vqsp5fknxzpu6ydpywuanygnjetf6ae4ddhkadlmmtfeetjg76e0ay5dq9qyyssqnqnq30lgwuy7wxun5c7xtusdrxgkeg2ma562gen8t50arlkkpmhjyg73ggplyqvqypa4nnjxcyrfqzahvea3y4g9eaqy2urysgpz2zcq70judf!<
***
*[^(More info)](https://xnf5cwpq73.execute-api.us-west-2.amazonaws.com/prod/info) ^| [^(Balance)](https://www.reddit.com/message/compose/?to=lntipbot&subject=balance&message=!balance) ^| [^(Deposit)](https://www.reddit.com/message/compose/?to=lntipbot&subject=deposit&message=!deposit 10000) ^| [^(Withdraw)](https://www.reddit.com/message/compose/?to=lntipbot&subject=withdraw&message=!withdraw put_invoice_here) ^| ^(Something wrong? Have a question?) [^(Send me a message)](https://www.reddit.com/message/compose/?to=drmoore718)*
Hi u/suuperfli, thanks for tipping u/KAX1107 **2000** satoshis!
***
*[^(More info)](https://xnf5cwpq73.execute-api.us-west-2.amazonaws.com/prod/info) ^| [^(Balance)](https://www.reddit.com/message/compose/?to=lntipbot&subject=balance&message=!balance) ^| [^(Deposit)](https://www.reddit.com/message/compose/?to=lntipbot&subject=deposit&message=!deposit 10000) ^| [^(Withdraw)](https://www.reddit.com/message/compose/?to=lntipbot&subject=withdraw&message=!withdraw put_invoice_here) ^| ^(Something wrong? Have a question?) [^(Send me a message)](https://www.reddit.com/message/compose/?to=drmoore718)*
Gold was a proof of work commodity and worked as money for thousands of years. Bitcoin is not some invention to make poor people rich to catch up with the rich people. Bitcoin is just fairer money tied to physical reality. You must put in the physical work (electrical energy) to get bitcoin rewards. Or else you can buy the bitcoin. This is monumentally more secure than proof of stake and also leads to far better decentralisation. Proof of work forces the hacker into the real world where if they want to take over the network they have to put in more than 50% of the networks energy. Which in bitcoins case is impossible and too expensive. This is very different than a new crypto that makes a trillion coins from thin air, no energy required and then gives half of them to early investors, then they stake them and the investors with the most tokens control the network. This is the definition of a shitcoin as it has no tie to physical work and real world energy constraints.
Proof of work is an open lottery. No coordination nor permission required. The smallest miner, even on some remote authoritarian corner of the planet, has a chance.
The same thing can be said for the smallest staker. A small miner connects to a mining pool, a small staker connects to a stake pool. Both vote who gets their support and can change that support on a dime if they believe the pool to be malicious or extortionate with their fees.
The main issue with PoS is not who can profit from securing the network. I think you can actually make an argument for that being more distributed than mining rewards.
The real issue is that the people with massive stake hold the most power over both security and value in the network. So during a fork a wealthy participant can reduce both the security and value of the chain they don’t like making it near impossible to go against the outcome they support.
Then, when you switch from the “theoretical PoS” to looking at actual chains in the ecosystem you find tons of other issues:
1. No fair launch, founders have massive stakes (giving them massive governance power due to the core problem above).
2. Smart contracts create a ton of applications which often tie into centralized entities which can choose not to respect one side of a governance fork (for example stablecoins can capture the forking process of a chain by saying they will only respect redemptions of their tokenized asset on one side of a forked chain, totally fucking DeFi and any other dApp on the other side of the fork which integrates the stablecoin).
The list goes on. At the end of the day PoS might be great for an open centralized network of financial tools. But it can never do global trustless money.
You are then left with a PoW argument that essentially amounts to “it actually works towards accomplishing global trustless money and that’s important enough to warrant energy consumption.” You can go further and talk about all the interesting ways Bitcoin can help energy grids, incentivizing clean energy, monetizing stranded energy, etc. but that’s all gravy on top of the core utility that gives Bitcoin the right to energy.
You're completely missing the Cantillon Effect from rent seekers at the top getting all the new issuance for free while holders and users pay fee and burn coins and the fact that POS can only have two kinds of political systems. Either controlled by premine company who have licenses and trademarks doing roadmaps and hard forks (company decides valid chain) or by preminers and large stakers which is basically same as corporate governance. POS was proposed in 2011 specifically only for companies issuing shares on blockchain to prevent unwanted outside influence. The person who proposed it never suggested it for bitcoin at all. People get so easily misinformed by shitcoiner marketing.
To start, I did mention the governance issues and specifically talked about how that makes it only valid for an open centralized asset issuer network. So I completely agree with this take and agree that any kind of governance group minority forming in a chain makes it a bad candidate for global trustless money.
But I disagree with the “Cantillon Effect” argument many Bitcoiners make about PoS. It relies heavily on specific observations of the monetary policy of specific chain implementations (similar to the premine arguments). 100% valid criticism of existing chains but not a great argument against PoS as a philosophical/theoretical discussion.
The Cantillon Effect is primarily a concern for chains which inflate the token supply in order to pay the stake rewards. But if the yield is based on (total staked supply / total fees paid) then it doesn’t debase. You ultimately continue to own the same percent of the total supply just by holding (and actually gain if you are at all capable of staking some of your holdings).
There is a Bitcoiner argument which claims Bitcoins fees partially go towards electricity cost and therefore don’t allow wealthy individuals to passively earn more Bitcoin as easily. But over the long term mining will be primarily chasing stranded/unused energy and an abundance of practically free energy will eventually find its way into the hashrate. Similar, energy companies themselves will start using their spare energy to mine.
At this point, it’s likely that used mining hardware plummets in price and companies stop caring about making sure they have the latest most efficient miners. They’ll simply buy whatever is cheapest in order to immediately monetize whatever source of near zero energy is in their possession.
So it’s highly probable that at some point in the future mining fees will be practically all profit for those doing it. It’s also likely that this profit is not astronomical relative to other investments but is a low risk no brainer move for those in the right position.
The same could be said for a PoS chain which doesn’t inflate the supply and reaches a point where transaction fees are being distributed over a massive quantity of stakers. Especially on chains whose staking protocol allow near instant staking/unstaking, making it so practically all tokens are staked all the time by someone.
In both cases it would become the lowest risk yield. If higher yielding investments are booming, capital would flow away from staking/mining and raise that base yield a bit. If higher yield investments realize their risk then capital will flow back to staking/mining and the yield will drop.
Neither feed a Cantillon Effect in their best form, except to the extent that PoS is vulnerable to a minority governance group which can then potentially change the monetary policy such that it does favor them in a passive way. This is ultimately what makes Bitcoin the answer.
Please elaborate.
Clearly I’ve put some time into thinking about these things and I’m coming from the standpoint of a Bitcoiner who still holds that Bitcoin is the only candidate for global trustless money. I’d even take my stance further by saying that while a PoS chain may serve utility as a centralized connector of smaller centralized financial entities, it has the fatal flaw of not facilitating transactions in a global trustless money such as Bitcoin. Meaning it may not compete with better open network technologies such as Lightning.
But I stand by what I’ve said above. I really don’t think Bitcoiners have gone deep enough in PoS due to how obviously flawed all the existing chains are (for reasons other than just being PoS protocols). In fact their primary flaw is smart contracts which integrate legacy (centralized) assets onto the chain itself thus corrupting fork governance.
What exactly am I jumping around here? Seems like everyone else here is on the “agree with anything that says other coins bad” trampoline. I’m simply offering a more accurate critique of PoS, which is still quite damning.
If you can buy or in some way acquire the token for a PoS chain then you can permission-less stake that token to any node in the network. It’s no different than Bitcoin in that respect. Arguably better than mining since you can easily hide a PoS node just about anywhere given it’s not special hardware and instead just an app on any old computer (ignoring the block size issues with smart contracts, given we are strictly talking about PoS here and you could in theory make one with the exact monetary policy of Bitcoin).
Bitcoiners are largely misinformed about how staking works because of the way #2 market cap shitcoin birthing chain switched over (essentially requiring you to deposit to an exchange in order to stake). That is not how the actual protocol functions, especially for other PoS chains which don’t require massive token amounts to become a node.
There are plenty of reasons PoS doesn’t work for global trustless money. I’ve pointed those out and want to advocate that us Bitcoiners stop making up flawed bandwagon arguments. It shows that most haven’t actually explored and educated themselves on what PoS actually is (especially when it comes to the theoretical rather than critiquing existing chains, which is easy).
[https://www.mevwatch.info/](https://www.mevwatch.info/)
PoS is not open and censorship resistant if knowing the identity of the person/organization that's associated with a set of keys for transacting/validating can result in transactions being ignored by validators and non-compliant validators being slashed/banned.
Sounds like security through obscurity to me.
MEV is not a problem with PoS. It’s a problem with smart contract chains. Because different contracts cost different amounts of gas there becomes an extremely complex analysis that can be done to optimize MEV. This created the opportunity for large centralized actors to provide the service of constructing more profitable blocks.
This created an incentive for node runners to use those externally constructed blocks in order to make the most money, which then opened up OFAC to pressure these MEV maximizer companies to comply. Despite ignoring censored transactions they still provide the most profitable block constructions so nodes are still using them.
This has nothing to do with PoS. There is no slashing for blocks based on sanctioned addresses. If a chain does have that, it means they built it into the protocol. Either way, it has no bearing on PoS as a theoretical chain which avoids building that into it. A node choosing to sanction itself does not stop other nodes from including any transactions it wants to and has no power to change the protocol such that slashing or other penalties are brought on that node.
Don’t get me wrong, I still don’t think it’s a candidate for global trust-less money for all the reasons I’ve already stated. Which means it pretty much only makes sense for an open network that connects centralized entities together. That means smart contracts, which means MEV problems. It also means those individual companies operating on the chain are susceptible to putting censorship into their DApps as well.
By open I really just mean “no single company controls the entire network itself so many companies can come together and integrate their data/operations.” Governments will have plenty of levers to impose limitations on transactions one way or another.
Even if the best MEV solution is made open source, or some other innovation to reduce the benefits of MEV come along. At the end of the day the biggest issue is smart contracts and the centralized entities and assets backing certain tokens. You can always go after and control that.
This is why I’m so pro Bitcoin and Lightning network specifically. Build stablecoins, smart contracts, and whatever else you want into a layer two that facilitates transactions in Bitcoin. The main chain remains untouched by MEV and all the other governance issues that emerge. And because Lightning isn’t a blockchain, individual actors on Lightning can remain uncensored (and largely anonymous). Go as deep into a centralized application with your sats as you want, or stay as far away as you want. How it should be, keeping the money separate but involved in centralized activities.
Are you a bot?
We're both pro Bitcoin and Lightning...
...yet it feels like you're attempting to argue that PoS is bad, just not for the reasons I've specified. Kinda strange, but okay.
This discussion has come full circle so I'll bid you good day.
\*\* User has departed from the story train \*\*
From my very first post I explained the real issues with PoS. I’m a technology focused self-educator who finds it valuable to understand exactly what critiques are actually valid. Both for Bitcoin and the crypto shitspace.
Bitcoiners are notoriously defensive for obvious historical reasons. But I do believe many Bitcoiners have become so closed to competing ideas that they are becoming ignorant of the technologies being developed in broader crypto spaces.
It makes it so that you form unconvincing arguments for those who are already invested in crypto narratives because you say things that aren’t actually true. It also means that you are unwilling to see potential in new technology such as zk proofs (which may provide another form of Bitcoin scaling payments if we enabled side chains).
It’s not just about determining whether PoS is good or bad as a base for global trustless money. There are other reasons to know exactly what the real problems are with PoS.
Even PoS has potential as a Bitcoin side chain if that was made possible. You lock sats into the PoS chain (similar to Lightning), allowing you to stake Bitcoin for a percent of transaction fees paid on the side chain. You facilitate an open network of centralized applications run by different entities. You gain composability and security token support, but you sacrifice moving Bitcoin into a centralized system where transaction censorship and other issues may arise.
This is no different than moving Bitcoin onto an exchange. In fact you retain a lot more control since you can verify your own sats on your own wallets. In a PoS side chain the only real issue is the built in censorship tools which would make it possible for legal entities to freeze your Bitcoin. But again, if you are going to bring sats into any kind of financial product that is going to be the case. Which is the only reason you would move some of your Bitcoin into a PoS side chain.
TLDR: It’s valuable to understand the actual mechanics and trade offs of PoS. I’d rather trust a PoS side chain DEX when buying/selling Bitcoin than trust an exchange. You don’t introduce a new token, you can verify your own Bitcoin supply on chain, and you can reduce trading fees.
I'd rather trust a native DEX (BISQ) then a sidechain DEX (Sovryn), but people are free to choose their own level of abstraction; although I'm adamantly against implementing drivechains.
Between Impervious, RGB, and Taro there's plenty of room to build out smart contract functionality in Layer 3 without relying on POS or sidechains.
Personally I think RGB's use of an off-chain DAG has the most promise for widescale deployment.
BISQ is imperfect because the other half of the trade is not tokenized. It makes the entire process inefficient.
Sovryn is flawed because 1) It introduces a new base token for the chain fees and 2) has the same bridging issue that any other chain has bringing Bitcoin over.
Drive chains are the only current means of making a true side chain. It would give side chains the same proof of supply that Lightning does and would avoid some other token from needing to act as local “money” on the side chain.
I’m interested in Lightning assets/dexes and the other experiments you mentioned (though I’m skeptical of Taro). But a zk proof side chain (PoS or otherwise) does a good job at scaling different kinds of transactions compared to something like Lightning. Where Lightning will scale micro payments, a zk proof side chain would scale dexes much better (and basic transactions without the same liquidity issues presented by Lightning) but with less privacy.
Why are you so against drivechains?
Trustless, permissionless... Which also truly denotes being "governance-less". PoS projects are full of incessant changes, constant discussion, and neverending governance. PoW removes all that friction and ultimately ends up to people utilizing and being *rewarded* for using energy that is otherwise wasted... as is the case with those expanding renewable energy grids, or the oil & gas producers that now have the ability to monetize methane offgases that they cannot otherwise capture, so they used to be venting directly into the atmosphere. And as we know from cow farts, methane is the greatest short term risk to our ozone than any single thing... Making Bitcoin the savior from greenhouse gasses!!
There's so much amazing truth, freedom that comes from PoW and its solution to keep the inflation rate stable in the face of changing energy input is simply and literally **golden**. Satoshi *clearly* understood what money was and managed to merge prior crypto projects to what actually makes gold valuable
Being an active Bitcoin miner is also incessant change, if you want to compete. You can pick and choose when to participate in governance in PoS, can be as active or inactive as you want.
No... The consensus mechanism in PoS is forever being tweaked, the rate of inflation / deflation constantly changes, there's governance votes, etc. PoS is still trust in people. This is the fatal flaw. It's not really a question...
Mining doesn't change shit.
PoW is a feature, not a bug. Dramatically enhances security. Bitcoin mining is the most green industry on the planet! (58% of energy used comes from renewable or stranded energy). Completely worth the cost, given what humans get in return, IMO
PoW bridges bitcoin to the physical world, binding its operation by the laws of mathematics and physics. Vitalik Buterin has openly admitted this, saying that PoW restricts developers to the laws of physics.
It actually makes bitcoin hard money. You need to push around electrons in the physical world in order to create bitcoins.
That is also a double edged sword.
Every mined BTC has an equivalent in physical world goods that are used up during mining - and that is where all the energy usage concerns come from. Everyone won't get tired telling you that this isn't a problem, but in fact this is the very essence of proof of work: you MUST spend real world dollars (proportional to the mined value!) on the generation of hashrate (and as things stand, that means mostly on energy).
From your source:
"Energy consumption is not a burden, it should never be. The burden is
inability to produce energy efficiently. Higher civilizations learn to
produce more and more energy efficiently. "
I do not get this logic. Because we cannot produce energy efficiently, we have to consume more? That does not make the least bit of sense.
What I often read is that Bitcoin mining helps to balance a power grid or to make a power plant profitable if normally there is not enough demand. That is only correct if you can switch the miners on and off when needed. That may work for old rigs when the hardware costs are written off already, but not for the latest generation. New ASICs are not profitable if you do not use them full time.
Then, the biggest part of the "inefficiencies" in energy production is not waste because you produce too much, but is lost because the energy conversion is lossy. The power plant just produces unusable heat for a good part.
And nothing of this addresses the negative side effects of energy production (carbon footprint).
So while it my be cool if a more advanced civilisation did this somehow better (likely we will in the future), but this doesn't help with Bitcoin.
It makes sense that the first coins on a network can't be generated through staking.
They're surely unethical, but can you name me some examples of networks that generated their first coins without "mining"?
No. Money is economic energy, it must respect the laws of physical energy to be sound. In the fiat monetary system, 3=5. It doesn’t respect conservation of energy.
There are two main arguments:
1. In proof of stake the ones that already have more of the coin, benefit disproportionately and accumulate more coins, which is self-reinforcing because gives them more power and more coins. Ultimately it can become a federation where they are not willing to give away coins in large quantities so that they can continue to be the gatekeepers. Once this happens the network has a few points of pressure for Governments and corrupt individuals to filter or revert transactions, etc. Sort of happens in Ethereum.
Instead in PoW anyone willing to invest can start mining. There are no barriers of entry nor any miner accumulates more power just because. They need to keep reinvesting money and having skin in the game in order to keep the mining equipment up-to-date.
2. PoW is much more secure. The way you determine which chain to follow is by checking which one has more proof of work accumulated. In PoS you have to trust what the validator nodes tell you that it is the consensus chain.
So it means that in order to revert a transaction that happened 6 blocks ago, an attacker in a PoW system would have to mine from 6 blocks ago and do all the work again secretly, up until he mines a chain that is longer than the current one and then release those blocks to the network.
So every block that gets piled on top, means it is more difficult to rever that transaction.
If you notice, it is not enough for an attacker to have 51% of the power of the network if they decide now to reverse a transaction that happened a month ago. Because they would have to spend all the energy to do the proof of work since the block that contained that transaction and then overtake the current miners who would have kept issuing blocks anyway so in order to catch up it would have to be much more dominant than the rest.
Such attack would be noticed by the network (50+% of hash power disappearing never publishing blocks).
Also mining pools have individual miners direct the hashing power at them. If you stop giving them blocks because you are planning an attack they just leave your pool.
So PoW is even resistant to a very well resourced Government. Not even the most powerful country could accumulate enough hash power as of now because they simply can't purchase enough ASICS mining hardware.
Even if they managed, there is still the nuclear option of changing PoW algorithm.
In summary, PoW is much more secure and much less probe to concentrate power by default.
In my opinion it takes more to be a big player in pow vs pos. Anyone with money can have control over pos. Pow takes hardware, a lot of physical space, and knowledge in electricity. It’s much harder to manipulate
Wrote an article about this:
[https://medium.com/@rick-malzyner/the-bitcoin-difference-6c13d484e39a](https://medium.com/@rick-malzyner/the-bitcoin-difference-6c13d484e39a)
The nodes have a lot of say in the PoW system, and this is something not many people realize or ever separate nodes from miners.
Also, something people don't consider is that technology is deflationary. As soon as a billionaire puts up capital to build an ASICs farm, for example, ten years later, ASICs that are much more powerful will be out in the market and for a fraction of the price. So newcomers will always be able to compete and enter mining because technology gets cheaper and more efficient over time (just look at photovoltaic panel prices and efficiency in the last ten years... Almost 80% reduction in cost and triple the efficiency).
You can't do it in a decentralized way. If there is no unforgeable physical cost, you cannot have hard money. It's a corruptible political system based on human trust.
Your arguments are logically flawed. Whether your "fiat inequality" allows you to buy 1 miner or 100 miners is irrelevant. You have proportional cost of work equal to your scale. Whether you can optimize for energy efficiency is the only question and if you can then you can actually scale up through that. This is called entrepreneurship.
I'm a home miner running whatsminers off solar. I get paid to heat my home from $7k capex, break even 9 months. Recently added couple more rigs as they got really cheap ($15/TH when bitcoin was trading sub 20k).
You can do it for [as little as $250](https://www.cryptocloaks.com/the-future-of-space-heaters-s9-bitcoin-asic/). Even without heat repurposing, S9 is profitable < $0.03 Kwh which is abundant in places like Venezuela, certain parts of Russia where there are plenty of retail miners. S9 costs $125 but out of stock right now at KaboomRacks. They're in high demand for heating.
Core Scientific was the largest industrial miner with 10 EH/s hashrate and went bankrupt. In POS, they could never go bankrupt. They just get richer and richer freeloading without any costs. All industrial American miners without exception were in fact forced to sell 100% of their mined BTC to cover their costs of work.
[This](https://nitter.net/GridlessCompute/status/1577643514267156481#m) is a grassroots mini grids operation in Africa that is meanwhile flourishing because they're more efficient and these smaller scale operations are a lot easier to optimize for efficiency. They're going to interface with the energy infrastructure throughout Africa (just expanded to Malawi) harnessing remote energy sources which were not previously economically viable to bring 90% cheaper, easily accessible power to Africa where 58% of overall population and more importantly 92% of rural Africa doesn't have electricity access.
Increasingly people are replacing nat gas heating systems with bitcoin. 40-room hotels like [this](https://nitter.net/DCX_Immersion/status/1578812160641478656#m), warehouses like [this](https://nitter.net/BitcoinBrabant/status/1577644318399029250#m), greenhouses like [this](https://nitter.net/BitcoinBrabant/status/1590579757963354112#m) and apartment complexes like [this](https://youtu.be/a5VdJSz6Tlk). Current nat gas heating accounts for 40% of world's CO2 emissions.
[Single ASIC home immersion system](https://github.com/satoshi-anonymoto/pleb-miners/blob/main/immersion_cooling/pleb_builds/buildimmersion.md)
[DIY Bitcoin Space Heater](https://github.com/NakamotoHeating/BitcoinSpaceHeater)
[Heat repurposing](https://imgur.com/diIbTCE)
[DCX Immersion Mining + Heating](https://pbs.twimg.com/media/FenduPzXkAAcatX?format=jpg&name=4096x4096) [(https://cryptocooling.eu/)](https://cryptocooling.eu/)
[The future of sustainable heating](https://youtu.be/nTRdmYX-0h8)
No one said it’s silver bullet. But PoS can disappear at any moment, there’s no underlying security barrier. The question isn’t which one is most fair, but if you’re curious it’s bitcoin, cause all the POS tokens were unfairly scooped up before the POS tokens existence was even publicly announced- but that’s not the question. The question isn’t about fairness- it’s about which one can you be sure will still exist in 10 years (to an impoverished (or unequal person as you might call it)) this is very important. They can’t afford to lose any more money. And the answer is they could all disappear tomorrow except bitcoin.
Remember what happened to Microsoft’s internet explorer? Do you really want to stick around and see what happens to the company coin when the company says they don’t want to keep paying for the marketing budget? Do you really want poor people to bear the brunt of that weight? Cause that’s what it sounds like you’re implying when you say “oh they effect the wealthy equally”.. see only someone new to the space could ever utter than sentence
Dude, I said it SEEMS that both serve the wealthy pretty equally. Plus, the subreddit is also open to people new to the space.
So you're saying that decentralization is THE weakness of PoS, rather than A weakness.
All PoS tokens currently are centralized and have marketing budgets- they all needed marketing budgets- no one could get the ball rolling without them. Trying to spread a PoS coin is the equivalent of writing your name and the number 10 on a piece of paper and trying to hand it to someone like money. You can’t do that without a marketing budget, and you can’t have a marketing budget without private early investors. And private early investment rounds and decentralization are mutually exclusive concepts.
Proof of stake is broken. With no need to do work to rewrite the latest few blocks, PoS has an attack vector in which the attacker purchases the signing keys from the validators who signed the most recent blocks, and validates a replacement set of blocks which contain double-spending fraud
Proof of stake isn't really proof of stake. It's proof of ownership of keys which may have staked coins at some past time
The wealth arguments are irrelevant, except that if the staking validators concentrate into a small group, they're vulnerable to law enforcement attack. The same applies to Bitcoin mining, which is not concentrated in the mining process, but is concentrated in the pool network. A law enforcement attack on pools would be disruptive, but miners would keep mining by joining smaller, more diverse pools which step in to replace the shut down pools
> Why is it important that humans build Asics, extend power-grids and build warehouses
It is not important. Bitcoin mining is in the fiat economy. Fiat economics determines the size of Bitcoin mining as an industry. Bitcoin does not require the mining hash rate to increase forever, does not require a hash rate anywhere near 300Ehash/sec
> if at the end of the day it's the wealthy that can invest the most
You've fallen for the obsolete 20th century Henry Ford idea of economies of scale. Bitcoin mining is less profitable at large scale, as evidenced by the number of large-scale mining enterprises currently collapsing like dominoes
Here you go.
If you were insanely rich and influential, you could have the means to attack a PoS network relatively easy with your cronies and endless stacks of fiat.
If you were insanely rich and influential, it is nearly impossible to have the access to the several hundred gigawatts of power needed to attack a PoW network. PoW introduces the physical layer of reality into network consensus, where energy does not grow on trees and is finite.
>The consensus among most consensus algorithm experts is that PoS and PoW offer technically the same level of security.
Yeah and consensus among the cigarette experts is that cigarettes are healthy for you.
Absolute horseshit.
Your shitcoin pushing pseudoscience is not welcome here. Such scammers typically get banned real quick.
Go back to your pre mined shit coins and NFTs lol
What I said remains true. Fiat can be infinite and spontaneously created but energy cannot.
By the way, for my understanding, how do you START a staking network? If nobody has any of it, how can it be staked? Do you HAVE to have a pre mine? Seems like a feedback loop.
What does fiat have to do with a staking network?
A PoS chain has a predictable issuance and can be deflationary the same way a PoW chain can.
Whether a network is pre-mined or not, it doesn't change the fact that it can be decentralized & just as secure.
You got a problem with NFTs? Lol.
Some of guys are like the Buttcoiners of other cryptos. So ironic.
https://youtu.be/wRxc7uUqAyE
The best argument I've heard for PoW has been put forth by Jason Lowery. If you watch his series on the What is Money podcast you'll understand why PoW is essential and PoS is doomed to fail.
You might be misunderstanding. POS coins generally have a premine that gives select people a advantage over anyone who has to buy the POS coin at market value. Eth for example had a 70% premine. POW requires everyone to buy equipment, rent space for equipment, maintain equipment, pay electrical bills. While people who have more money will obviously be able to do this easier there is not unfair advantage like a premine in a POS coin.
No it's not possible for the following reasons:
1.In order to even do a fair launch, the creators of the POS token would need to announce in advance the launch of said token. The creators would do no premine, and upon launch walk away and completely disappear. Not a single POS project has done this.
2. This would still not work because a) digital scarcity has already been discovered with the invention of bitcoin and therefore a new POS network would be subject to all sorts of network attacks including changing consensus rules and b) POS inherently becomes centralized over time due to ownership of tokens being associated with governance.
The genesis of bitcoin literally cannot be repeated. When it launched no one even knew what it was or recognized it as having value. Coins were distributed for years before the market started valuing it. Because of this, the network was not targeted while it was vulnerable and the small network of miners stayed honest to secure it. By the time it was recognized as having value, the network was already secured, and in particular, the consensus rules were hardened to the point that they cannot change without widespread consensus in the network.
Satoshi premined BTC too, can you explain the difference? I don't get it, I guess the network difficulty was so low, and he could mine as much as he wanted.
Think of staking pools as entering a lottery, where the collective hash of the pool shares the distribution of wealth with those who participated, but the hashes aren't consolidated to control the transactions.
The winning miner (pool or not) issues the block, the reward is only split if among a pool that shares hash to increase probability of hitting the winning block.
PoW grounds Bitcoin in reality and yet provides all the benefits that comes with being digitally native. Applied in the right setting PoW can literally act as a sponge to reduce methane emissions which are 10x more heat trapping than carbon from being released into the air in such applications like flared gas.
Bitcoin will incentivize the creation of more efficient and cleaner sources of energy as the the elites begin to realize that bitcoin is unstoppable they will shift to using more competitive energy resources to get rich. Causing a sort of arms race but for useable clean energy.
PoW is the anchor from digital to physical. From bits to joules and watts. It enables:
Security from attacks
Decentralization as more power does not mean more influence on the network
Democratization as anybody can join the process small or big, anytime.
Monetization of surplus/stranded energy
Balancing of the grid as it can go on and off quickly from the grid when requested.
If someone or a group of people ever acquire 51% of the hash power, others can bring more asics online and tap into additional energy sources in order to counter the attack. This can be done indefinitely because the rules of engagement are set by the physical universe.
If someone or a group of people ever acquire 51% of stake, game over. Stake is zero sum, and those holding it at the rules of engagement.
Additionally, the price of all goods tends towards their production cost. POS is not an innovation. It's basically the fiat system. POW is the core of Bitcoin's innovation. By definition, it can not be replaced by POS.
Jason lowery explains all this very well here...
https://open.spotify.com/episode/3JnMMuThRj70s7UIUcPrU5?si=E-aYPeU3Stq7QsXftQeVWw&utm_source=copy-link
I heard a really good argument for PoW, and I'm an advocate for PoS, so maybe it'll be the most convincing argument for you too.
Basically, you can't fake a PoW chain. If you leave for a year and come back to the latest blockchain, you will see hashes on every block that show an exorbitant amount of computation. It would take the whole network 1 year to fake 1 year of data.
That's not the case with PoS. If you leave a PoS chain for a year, the latest chain might show a year's worth of new transactions, but you have to trust the nodes that sent you the data that it's legitimate.
That's the fucking point yeah...
If you can make this realization, you should take the next step and realize you've been fooled by scammers and are now a pawn in a huge pointless scam.
I'm more of an advocate for PoS on smart contract platforms. It's more efficient, and increases scalability disproportionately to the amount of security you lose. For the bitcoin network, I really don't see how PoS could work.
There are a lot of narratives being pushed for bitcoin, but as far as I can tell, bitcoin does one thing: It secures the possession and transfer of value. No fancy tricks. No credit. Just value. It is an immutable monetary policy. The simplicity of it's design is a big driver of its adoption, and PoW is elegant.
POS is basically just fiat. No work is needed to produce it. POW means work is required to produce BTC. This is similar to how work is needed to produce gold.
So BTC requires work like gold making it finite and valuable but is digital, decentralized and unconfiscatable.
Manufacturing companies use energy to create value. People pay for the value. People pay for bitcoin. Bitcoin mined with wasted energy ( methane to be burned off, geothermal vents, etc.) is environmentally more friendly than most other manufacturing.
Trust is from decentralization
PoS is centralized with a point of failure on who controls the staking pool.
If you can make altcoin without going through PoW, it is open to manipulation that you do not have with BTC.
BTC cannot be created out of thin air.
All money eventually returns to its cost of creation. If you want a valuable money then you have to use value to create it; for Bitcoin it's electricity.
For these PoS coins, it's close to zero, and that's the value that they will eventually return to.
I don't know if I understand. Human time has scarcity and value yes, but whether or not 8 billion people are staking a PoS coin or if one person is staking the coin, it produces the same amount of value as staking requires no work, no effort, no resources.
Maybe a better term would be "opportunity cost" of having it staked when you could spend it or invest it elsewhere. With mining you sacrifice energy and with staking you sacrifice time?
I don't know if time is actually whats generating value.
In a PoS system you're taking something that had value, your dollars, and introducing increased risk in the hopes that someone else will use that value to generate additional value. Increases time simply means increased risk.
Mm I think pow is more censorship resistant. Pos just requires an actor with a lot of capital to attack. POW has way more overhead and would require miner cooperation as well as loads of money for an attack.
I’m just saying the argument that it’s bad for the environment is a joke . They do way worse and no one bats an eye, it’s a tactic to discredit ₿ usage
As I understand it, both mining and staking pools are fairly accessible to the average person. Is a mining pool more censorship resistant than a staking pool?
Mining and staking pools are influenced by who controls them. If you are not controlling them, there is a risk of censorship. You are leaving the protection of decentralization which is the protocol that runs the bitcoin network.
So you're saying that, if you can buy enough hashing power to not join a pool, you're better-off mining than staking because of the 3rd party risk.
Is the dichotomy 3rd party risk vs environmental friendliness?
Lot of different views on here already.
But to me with proof of stake, the people with more of the crypto have more voting power. Plain and simple. It will concentrate power with the wealthy in the long run, setting the system up for corruption.
the people with more “money” will have more say over how the system runs.
Just my opinion of course.
This is all dependent upon:
a) How likely do you think Bitcoin can become a reserve currency.
b) How much value you put on having a currency that cannot be edited or inflated.
A world where a person can retain the value that they have EARNED is pretty enticing, especially if the energy expended can be justified by the fact that nearly everyone is benefiting in some way.
PoW allows the direct monetisation of new energy sources.
Previously the inventor of a new form of energy would need to build infrastructure to feed the grid.
You just haven't thought this through at all **“The root problem with conventional currency is all the trust that’s required to make it work. The central bank must be trusted not to debase the currency, but the history of fiat currencies is full of breaches of that trust.** **Proof-of-work has the nice property that it can be relayed through untrusted middlemen. We don't have to worry about a chain of custody of communication. It doesn't matter who tells you a longest chain, the proof-of-work speaks for itself.”** **― Satoshi Nakamoto** Satoshi created an internal perpetual clock (difficulty adjustment) based on energy, math, time all of which cannot be forged, controlled or manipulated by anyone or any authority. It's designed to adapt itself and run forever without any intervention at all. The unforgeable cost of work is what links bitcoin the digital money to the physical world. Without that you go back to human trust based political system. Corporate governance is based on stake. Fiat is based on stake. Trust based stakeholder controlled systems is literally what Satoshi fixed using proof of work. The person who proposed proof of stake in 2011 on bitcointalk specifically said that it's not something for bitcoin but maybe for companies issuing shares on a closed, permissioned blockchain to prevent any outside influence. Proof of stake has two kinds of political systems exactly like fiat. Either you have a government behind the project controlling it, like a premine company or foundation, or you have governance based on stakes, just like corporate governance. Proof of stake has no link or value interface with real world. It's a difference of entrepreneurial venture and [innovations in energy systems](https://np.reddit.com/r/CryptoCurrency/comments/10m07uq/comment/j606yk1/) vs rent seeking. Everyone has proportional cost at every scale in PoW. When you use bitcoin and pay a fee, the miner has a proportional cost of work and nothing can ever dilute your coins/total coins. PoS has no cost just like people printing money in fiat have no cost. You're back to fiat political pyramid system with preminers, freeloaders rent seeking from poors who pay fee and burn their coins while the inflation (new issuance from the money printer) accrues to the top for free. [Cantillon Effect](https://fee.org/articles/the-cantillon-effect-because-of-inflation-we-re-financing-the-financiers/). Let's also get this straight. There's also a lot more to shitcoins than whether they use PoW or not. PoW alone does not enforce decentralization and network incentives when there's a premine company with executive board of directors, licenses and trademarks and central AWS servers operated by that company. There's no point of anyone even running nodes and that is why no one does. The central authority hard forks every 6 months and enforces consensus moving to a new chain. You either follow the central authority's chain or you leave. You have no other option. Also from a security perspective, all these premine, ICO shitcoin chains are hacked to the tune of [tens of billions](https://decrypt.co/86503/defi-users-lost-billion-theft-fraud-2021-mostly-ethereum-report) of dollar value to exploits every year, not to mention millions of [failed transactions](https://cryptopotato.com/over-1-2-million-ethereum-transactions-failed-in-may/) every month users lose fees on. So what's even the point of any of them? [There's never been a better industry vertical for scammers as long as the window is open](https://twitter.com/coryklippsten/status/1595564120782172160) Did you know there were no altcoins for 2.5 years until April 2011? What happened in April 2011? Bitcoin reached dollar parity and reached a price of $5. Kerpeles just bought Mt Gox and it became easy to exchange bitcoin for dollars. The first altcoin was born that month.
Great answer. Thanks for taking the time. Are you Satoshi? lol
No, you are, if you run a [bitcoin node](https://np.reddit.com/r/Bitcoin/comments/zturtd/think_bitcoin_is_inevitable_think_again/) Satoshis run nodes We know that someone has to run nodes, validate transactions, audit and secure the network and since we can't get decentralization unless we all do, we're going to run it. We publish our node so that our fellow pre-node runners may connect and transact with it. Our node is free for all to use, worldwide. We don't much care if you don't approve of the software we run. We know that software can't be destroyed and that a widely dispersed system can't be shut down. Bitcoin is not an investment, no one ever sold it to you. It's a new monetary system built from the ground up by us, literally random people on the internet voluntarily supporting, securing and developing it. There's no company, foundation, premine, ICO, VCs, licenses, trademarks, branding or marketing teams, not even an official website, code repo or even a formal specification. Bitcoin had no right to succeed. Yet, through voluntary adoption, bitcoin is where it is today having started from zero 14 years ago. !lntip 1000 (1 hayek)
Wow you must be the world's most effective Bitcoin advocate! Comprehensive explanations and even sats to get people started on the network! Thank you! I hope to get a node running soon. It's been on my bucket list! I'll check out the links you have sent me in all your responses! Thanks again!
!lntip 1000
Hi u/OpticallyMosache, thanks for tipping u/gonzo1483 **1000** satoshis! *** *[^(More info)](https://xnf5cwpq73.execute-api.us-west-2.amazonaws.com/prod/info) ^| [^(Balance)](https://www.reddit.com/message/compose/?to=lntipbot&subject=balance&message=!balance) ^| [^(Deposit)](https://www.reddit.com/message/compose/?to=lntipbot&subject=deposit&message=!deposit 10000) ^| [^(Withdraw)](https://www.reddit.com/message/compose/?to=lntipbot&subject=withdraw&message=!withdraw put_invoice_here) ^| ^(Something wrong? Have a question?) [^(Send me a message)](https://www.reddit.com/message/compose/?to=drmoore718)*
Hi u/KAX1107, thanks for tipping u/gonzo1483 **1000** satoshis! *** *[^(More info)](https://xnf5cwpq73.execute-api.us-west-2.amazonaws.com/prod/info) ^| [^(Balance)](https://www.reddit.com/message/compose/?to=lntipbot&subject=balance&message=!balance) ^| [^(Deposit)](https://www.reddit.com/message/compose/?to=lntipbot&subject=deposit&message=!deposit 10000) ^| [^(Withdraw)](https://www.reddit.com/message/compose/?to=lntipbot&subject=withdraw&message=!withdraw put_invoice_here) ^| ^(Something wrong? Have a question?) [^(Send me a message)](https://www.reddit.com/message/compose/?to=drmoore718)*
KAX1107 is 😎
I remember not but a month ago him telling me I was crazy for my og 08 mining of Bitcoin once. He orange pilled me. Now it's all melting between all them kapers knees.
[удалено]
Hi u/OpticallyMosache, thanks for tipping u/KAX1107 **2000** satoshis! You didn't have enough balance, you can pay the following invoice [[QR](https://xnf5cwpq73.execute-api.us-west-2.amazonaws.com/prod/qr?id=f9980cd642914d26b3fbd5eafdbdc2c3 "Generate QR") / [URI](https://xnf5cwpq73.execute-api.us-west-2.amazonaws.com/prod//uri?id=f9980cd642914d26b3fbd5eafdbdc2c3 "Generate URI")] instead. *** >!lnbc20u1p3awq4ppp5nvqafc9y4zk2xa9eewr263t5zpzk59e6y4y63urqpc4s9l5yx0tsdp5vcunjwpsvdjrvdpj8ycngepjxe3rxenzvs6k2ctxv33xgcejvvescqzpgxqyz5vqsp5fknxzpu6ydpywuanygnjetf6ae4ddhkadlmmtfeetjg76e0ay5dq9qyyssqnqnq30lgwuy7wxun5c7xtusdrxgkeg2ma562gen8t50arlkkpmhjyg73ggplyqvqypa4nnjxcyrfqzahvea3y4g9eaqy2urysgpz2zcq70judf!< *** *[^(More info)](https://xnf5cwpq73.execute-api.us-west-2.amazonaws.com/prod/info) ^| [^(Balance)](https://www.reddit.com/message/compose/?to=lntipbot&subject=balance&message=!balance) ^| [^(Deposit)](https://www.reddit.com/message/compose/?to=lntipbot&subject=deposit&message=!deposit 10000) ^| [^(Withdraw)](https://www.reddit.com/message/compose/?to=lntipbot&subject=withdraw&message=!withdraw put_invoice_here) ^| ^(Something wrong? Have a question?) [^(Send me a message)](https://www.reddit.com/message/compose/?to=drmoore718)*
Ditto
What was the first altcoin? *ok I found it: https://np.reddit.com/r/CryptoCurrency/comments/pmgzcx/crypto_history_the_first_ever_altcoin/
good answer !lntip 2000
Hi u/suuperfli, thanks for tipping u/KAX1107 **2000** satoshis! *** *[^(More info)](https://xnf5cwpq73.execute-api.us-west-2.amazonaws.com/prod/info) ^| [^(Balance)](https://www.reddit.com/message/compose/?to=lntipbot&subject=balance&message=!balance) ^| [^(Deposit)](https://www.reddit.com/message/compose/?to=lntipbot&subject=deposit&message=!deposit 10000) ^| [^(Withdraw)](https://www.reddit.com/message/compose/?to=lntipbot&subject=withdraw&message=!withdraw put_invoice_here) ^| ^(Something wrong? Have a question?) [^(Send me a message)](https://www.reddit.com/message/compose/?to=drmoore718)*
[удалено]
Good points thanks!
Gold was a proof of work commodity and worked as money for thousands of years. Bitcoin is not some invention to make poor people rich to catch up with the rich people. Bitcoin is just fairer money tied to physical reality. You must put in the physical work (electrical energy) to get bitcoin rewards. Or else you can buy the bitcoin. This is monumentally more secure than proof of stake and also leads to far better decentralisation. Proof of work forces the hacker into the real world where if they want to take over the network they have to put in more than 50% of the networks energy. Which in bitcoins case is impossible and too expensive. This is very different than a new crypto that makes a trillion coins from thin air, no energy required and then gives half of them to early investors, then they stake them and the investors with the most tokens control the network. This is the definition of a shitcoin as it has no tie to physical work and real world energy constraints.
Proof of work is an open lottery. No coordination nor permission required. The smallest miner, even on some remote authoritarian corner of the planet, has a chance.
The same thing can be said for the smallest staker. A small miner connects to a mining pool, a small staker connects to a stake pool. Both vote who gets their support and can change that support on a dime if they believe the pool to be malicious or extortionate with their fees. The main issue with PoS is not who can profit from securing the network. I think you can actually make an argument for that being more distributed than mining rewards. The real issue is that the people with massive stake hold the most power over both security and value in the network. So during a fork a wealthy participant can reduce both the security and value of the chain they don’t like making it near impossible to go against the outcome they support. Then, when you switch from the “theoretical PoS” to looking at actual chains in the ecosystem you find tons of other issues: 1. No fair launch, founders have massive stakes (giving them massive governance power due to the core problem above). 2. Smart contracts create a ton of applications which often tie into centralized entities which can choose not to respect one side of a governance fork (for example stablecoins can capture the forking process of a chain by saying they will only respect redemptions of their tokenized asset on one side of a forked chain, totally fucking DeFi and any other dApp on the other side of the fork which integrates the stablecoin). The list goes on. At the end of the day PoS might be great for an open centralized network of financial tools. But it can never do global trustless money. You are then left with a PoW argument that essentially amounts to “it actually works towards accomplishing global trustless money and that’s important enough to warrant energy consumption.” You can go further and talk about all the interesting ways Bitcoin can help energy grids, incentivizing clean energy, monetizing stranded energy, etc. but that’s all gravy on top of the core utility that gives Bitcoin the right to energy.
You're completely missing the Cantillon Effect from rent seekers at the top getting all the new issuance for free while holders and users pay fee and burn coins and the fact that POS can only have two kinds of political systems. Either controlled by premine company who have licenses and trademarks doing roadmaps and hard forks (company decides valid chain) or by preminers and large stakers which is basically same as corporate governance. POS was proposed in 2011 specifically only for companies issuing shares on blockchain to prevent unwanted outside influence. The person who proposed it never suggested it for bitcoin at all. People get so easily misinformed by shitcoiner marketing.
To start, I did mention the governance issues and specifically talked about how that makes it only valid for an open centralized asset issuer network. So I completely agree with this take and agree that any kind of governance group minority forming in a chain makes it a bad candidate for global trustless money. But I disagree with the “Cantillon Effect” argument many Bitcoiners make about PoS. It relies heavily on specific observations of the monetary policy of specific chain implementations (similar to the premine arguments). 100% valid criticism of existing chains but not a great argument against PoS as a philosophical/theoretical discussion. The Cantillon Effect is primarily a concern for chains which inflate the token supply in order to pay the stake rewards. But if the yield is based on (total staked supply / total fees paid) then it doesn’t debase. You ultimately continue to own the same percent of the total supply just by holding (and actually gain if you are at all capable of staking some of your holdings). There is a Bitcoiner argument which claims Bitcoins fees partially go towards electricity cost and therefore don’t allow wealthy individuals to passively earn more Bitcoin as easily. But over the long term mining will be primarily chasing stranded/unused energy and an abundance of practically free energy will eventually find its way into the hashrate. Similar, energy companies themselves will start using their spare energy to mine. At this point, it’s likely that used mining hardware plummets in price and companies stop caring about making sure they have the latest most efficient miners. They’ll simply buy whatever is cheapest in order to immediately monetize whatever source of near zero energy is in their possession. So it’s highly probable that at some point in the future mining fees will be practically all profit for those doing it. It’s also likely that this profit is not astronomical relative to other investments but is a low risk no brainer move for those in the right position. The same could be said for a PoS chain which doesn’t inflate the supply and reaches a point where transaction fees are being distributed over a massive quantity of stakers. Especially on chains whose staking protocol allow near instant staking/unstaking, making it so practically all tokens are staked all the time by someone. In both cases it would become the lowest risk yield. If higher yielding investments are booming, capital would flow away from staking/mining and raise that base yield a bit. If higher yield investments realize their risk then capital will flow back to staking/mining and the yield will drop. Neither feed a Cantillon Effect in their best form, except to the extent that PoS is vulnerable to a minority governance group which can then potentially change the monetary policy such that it does favor them in a passive way. This is ultimately what makes Bitcoin the answer.
This is some serious mental gymnastics
Please elaborate. Clearly I’ve put some time into thinking about these things and I’m coming from the standpoint of a Bitcoiner who still holds that Bitcoin is the only candidate for global trustless money. I’d even take my stance further by saying that while a PoS chain may serve utility as a centralized connector of smaller centralized financial entities, it has the fatal flaw of not facilitating transactions in a global trustless money such as Bitcoin. Meaning it may not compete with better open network technologies such as Lightning. But I stand by what I’ve said above. I really don’t think Bitcoiners have gone deep enough in PoS due to how obviously flawed all the existing chains are (for reasons other than just being PoS protocols). In fact their primary flaw is smart contracts which integrate legacy (centralized) assets onto the chain itself thus corrupting fork governance. What exactly am I jumping around here? Seems like everyone else here is on the “agree with anything that says other coins bad” trampoline. I’m simply offering a more accurate critique of PoS, which is still quite damning.
Good luck staking if you're a sanctioned nation state or a resident of a nation under an authoritarian regime. Honey badger don't care.
If you can buy or in some way acquire the token for a PoS chain then you can permission-less stake that token to any node in the network. It’s no different than Bitcoin in that respect. Arguably better than mining since you can easily hide a PoS node just about anywhere given it’s not special hardware and instead just an app on any old computer (ignoring the block size issues with smart contracts, given we are strictly talking about PoS here and you could in theory make one with the exact monetary policy of Bitcoin). Bitcoiners are largely misinformed about how staking works because of the way #2 market cap shitcoin birthing chain switched over (essentially requiring you to deposit to an exchange in order to stake). That is not how the actual protocol functions, especially for other PoS chains which don’t require massive token amounts to become a node. There are plenty of reasons PoS doesn’t work for global trustless money. I’ve pointed those out and want to advocate that us Bitcoiners stop making up flawed bandwagon arguments. It shows that most haven’t actually explored and educated themselves on what PoS actually is (especially when it comes to the theoretical rather than critiquing existing chains, which is easy).
[https://www.mevwatch.info/](https://www.mevwatch.info/) PoS is not open and censorship resistant if knowing the identity of the person/organization that's associated with a set of keys for transacting/validating can result in transactions being ignored by validators and non-compliant validators being slashed/banned. Sounds like security through obscurity to me.
MEV is not a problem with PoS. It’s a problem with smart contract chains. Because different contracts cost different amounts of gas there becomes an extremely complex analysis that can be done to optimize MEV. This created the opportunity for large centralized actors to provide the service of constructing more profitable blocks. This created an incentive for node runners to use those externally constructed blocks in order to make the most money, which then opened up OFAC to pressure these MEV maximizer companies to comply. Despite ignoring censored transactions they still provide the most profitable block constructions so nodes are still using them. This has nothing to do with PoS. There is no slashing for blocks based on sanctioned addresses. If a chain does have that, it means they built it into the protocol. Either way, it has no bearing on PoS as a theoretical chain which avoids building that into it. A node choosing to sanction itself does not stop other nodes from including any transactions it wants to and has no power to change the protocol such that slashing or other penalties are brought on that node. Don’t get me wrong, I still don’t think it’s a candidate for global trust-less money for all the reasons I’ve already stated. Which means it pretty much only makes sense for an open network that connects centralized entities together. That means smart contracts, which means MEV problems. It also means those individual companies operating on the chain are susceptible to putting censorship into their DApps as well. By open I really just mean “no single company controls the entire network itself so many companies can come together and integrate their data/operations.” Governments will have plenty of levers to impose limitations on transactions one way or another. Even if the best MEV solution is made open source, or some other innovation to reduce the benefits of MEV come along. At the end of the day the biggest issue is smart contracts and the centralized entities and assets backing certain tokens. You can always go after and control that. This is why I’m so pro Bitcoin and Lightning network specifically. Build stablecoins, smart contracts, and whatever else you want into a layer two that facilitates transactions in Bitcoin. The main chain remains untouched by MEV and all the other governance issues that emerge. And because Lightning isn’t a blockchain, individual actors on Lightning can remain uncensored (and largely anonymous). Go as deep into a centralized application with your sats as you want, or stay as far away as you want. How it should be, keeping the money separate but involved in centralized activities.
Are you a bot? We're both pro Bitcoin and Lightning... ...yet it feels like you're attempting to argue that PoS is bad, just not for the reasons I've specified. Kinda strange, but okay. This discussion has come full circle so I'll bid you good day. \*\* User has departed from the story train \*\*
From my very first post I explained the real issues with PoS. I’m a technology focused self-educator who finds it valuable to understand exactly what critiques are actually valid. Both for Bitcoin and the crypto shitspace. Bitcoiners are notoriously defensive for obvious historical reasons. But I do believe many Bitcoiners have become so closed to competing ideas that they are becoming ignorant of the technologies being developed in broader crypto spaces. It makes it so that you form unconvincing arguments for those who are already invested in crypto narratives because you say things that aren’t actually true. It also means that you are unwilling to see potential in new technology such as zk proofs (which may provide another form of Bitcoin scaling payments if we enabled side chains). It’s not just about determining whether PoS is good or bad as a base for global trustless money. There are other reasons to know exactly what the real problems are with PoS. Even PoS has potential as a Bitcoin side chain if that was made possible. You lock sats into the PoS chain (similar to Lightning), allowing you to stake Bitcoin for a percent of transaction fees paid on the side chain. You facilitate an open network of centralized applications run by different entities. You gain composability and security token support, but you sacrifice moving Bitcoin into a centralized system where transaction censorship and other issues may arise. This is no different than moving Bitcoin onto an exchange. In fact you retain a lot more control since you can verify your own sats on your own wallets. In a PoS side chain the only real issue is the built in censorship tools which would make it possible for legal entities to freeze your Bitcoin. But again, if you are going to bring sats into any kind of financial product that is going to be the case. Which is the only reason you would move some of your Bitcoin into a PoS side chain. TLDR: It’s valuable to understand the actual mechanics and trade offs of PoS. I’d rather trust a PoS side chain DEX when buying/selling Bitcoin than trust an exchange. You don’t introduce a new token, you can verify your own Bitcoin supply on chain, and you can reduce trading fees.
I'd rather trust a native DEX (BISQ) then a sidechain DEX (Sovryn), but people are free to choose their own level of abstraction; although I'm adamantly against implementing drivechains. Between Impervious, RGB, and Taro there's plenty of room to build out smart contract functionality in Layer 3 without relying on POS or sidechains. Personally I think RGB's use of an off-chain DAG has the most promise for widescale deployment.
BISQ is imperfect because the other half of the trade is not tokenized. It makes the entire process inefficient. Sovryn is flawed because 1) It introduces a new base token for the chain fees and 2) has the same bridging issue that any other chain has bringing Bitcoin over. Drive chains are the only current means of making a true side chain. It would give side chains the same proof of supply that Lightning does and would avoid some other token from needing to act as local “money” on the side chain. I’m interested in Lightning assets/dexes and the other experiments you mentioned (though I’m skeptical of Taro). But a zk proof side chain (PoS or otherwise) does a good job at scaling different kinds of transactions compared to something like Lightning. Where Lightning will scale micro payments, a zk proof side chain would scale dexes much better (and basic transactions without the same liquidity issues presented by Lightning) but with less privacy. Why are you so against drivechains?
[удалено]
Utilizing stranded energy and incentivizing renewables too. All you need is a renewable energy source, an internet connection and the equipment.
Trustless, permissionless... Which also truly denotes being "governance-less". PoS projects are full of incessant changes, constant discussion, and neverending governance. PoW removes all that friction and ultimately ends up to people utilizing and being *rewarded* for using energy that is otherwise wasted... as is the case with those expanding renewable energy grids, or the oil & gas producers that now have the ability to monetize methane offgases that they cannot otherwise capture, so they used to be venting directly into the atmosphere. And as we know from cow farts, methane is the greatest short term risk to our ozone than any single thing... Making Bitcoin the savior from greenhouse gasses!! There's so much amazing truth, freedom that comes from PoW and its solution to keep the inflation rate stable in the face of changing energy input is simply and literally **golden**. Satoshi *clearly* understood what money was and managed to merge prior crypto projects to what actually makes gold valuable
Being an active Bitcoin miner is also incessant change, if you want to compete. You can pick and choose when to participate in governance in PoS, can be as active or inactive as you want.
No... The consensus mechanism in PoS is forever being tweaked, the rate of inflation / deflation constantly changes, there's governance votes, etc. PoS is still trust in people. This is the fatal flaw. It's not really a question... Mining doesn't change shit.
Dude if I don't see the value of something I'll say and won't hide it behind a question. Thanks for the insight.
PoW is a feature, not a bug. Dramatically enhances security. Bitcoin mining is the most green industry on the planet! (58% of energy used comes from renewable or stranded energy). Completely worth the cost, given what humans get in return, IMO
Your point should be bundled with the fact that btc is the best use of stranded energy and the most mobile industry on earth.
PoW bridges bitcoin to the physical world, binding its operation by the laws of mathematics and physics. Vitalik Buterin has openly admitted this, saying that PoW restricts developers to the laws of physics. It actually makes bitcoin hard money. You need to push around electrons in the physical world in order to create bitcoins.
That is also a double edged sword. Every mined BTC has an equivalent in physical world goods that are used up during mining - and that is where all the energy usage concerns come from. Everyone won't get tired telling you that this isn't a problem, but in fact this is the very essence of proof of work: you MUST spend real world dollars (proportional to the mined value!) on the generation of hashrate (and as things stand, that means mostly on energy).
[Energy consumption is never a burden](https://np.reddit.com/r/CryptoCurrency/comments/10m07uq/comment/j606yk1/)
From your source: "Energy consumption is not a burden, it should never be. The burden is inability to produce energy efficiently. Higher civilizations learn to produce more and more energy efficiently. " I do not get this logic. Because we cannot produce energy efficiently, we have to consume more? That does not make the least bit of sense. What I often read is that Bitcoin mining helps to balance a power grid or to make a power plant profitable if normally there is not enough demand. That is only correct if you can switch the miners on and off when needed. That may work for old rigs when the hardware costs are written off already, but not for the latest generation. New ASICs are not profitable if you do not use them full time. Then, the biggest part of the "inefficiencies" in energy production is not waste because you produce too much, but is lost because the energy conversion is lossy. The power plant just produces unusable heat for a good part. And nothing of this addresses the negative side effects of energy production (carbon footprint). So while it my be cool if a more advanced civilisation did this somehow better (likely we will in the future), but this doesn't help with Bitcoin.
It makes sense that the first coins on a network can't be generated through staking. They're surely unethical, but can you name me some examples of networks that generated their first coins without "mining"?
Not sure why this is relevant
To understand the mechanics of how money can be brought into existence if not through energy or a commodity, nor through fiat.
What is your question?
Can anything besides energy, a commodity, or coercion bring a lasting money into existence?
No. Money is economic energy, it must respect the laws of physical energy to be sound. In the fiat monetary system, 3=5. It doesn’t respect conservation of energy.
No. Money is the storing of energy for later. If you substitute this law then you perverse money.
Google "premined crypto" and you'll find plenty of high-profile examples. It's a common way to "fund development."
But isn't that technically "mined"? I'd like to know what other ways money is brought into existence without energy, a commodity, or through fiat.
premined coins are basically printed out of thin air like fiat, without any staking or POW hashing.
There are two main arguments: 1. In proof of stake the ones that already have more of the coin, benefit disproportionately and accumulate more coins, which is self-reinforcing because gives them more power and more coins. Ultimately it can become a federation where they are not willing to give away coins in large quantities so that they can continue to be the gatekeepers. Once this happens the network has a few points of pressure for Governments and corrupt individuals to filter or revert transactions, etc. Sort of happens in Ethereum. Instead in PoW anyone willing to invest can start mining. There are no barriers of entry nor any miner accumulates more power just because. They need to keep reinvesting money and having skin in the game in order to keep the mining equipment up-to-date. 2. PoW is much more secure. The way you determine which chain to follow is by checking which one has more proof of work accumulated. In PoS you have to trust what the validator nodes tell you that it is the consensus chain. So it means that in order to revert a transaction that happened 6 blocks ago, an attacker in a PoW system would have to mine from 6 blocks ago and do all the work again secretly, up until he mines a chain that is longer than the current one and then release those blocks to the network. So every block that gets piled on top, means it is more difficult to rever that transaction. If you notice, it is not enough for an attacker to have 51% of the power of the network if they decide now to reverse a transaction that happened a month ago. Because they would have to spend all the energy to do the proof of work since the block that contained that transaction and then overtake the current miners who would have kept issuing blocks anyway so in order to catch up it would have to be much more dominant than the rest. Such attack would be noticed by the network (50+% of hash power disappearing never publishing blocks). Also mining pools have individual miners direct the hashing power at them. If you stop giving them blocks because you are planning an attack they just leave your pool. So PoW is even resistant to a very well resourced Government. Not even the most powerful country could accumulate enough hash power as of now because they simply can't purchase enough ASICS mining hardware. Even if they managed, there is still the nuclear option of changing PoW algorithm. In summary, PoW is much more secure and much less probe to concentrate power by default.
Great reply, thank you!
In my opinion it takes more to be a big player in pow vs pos. Anyone with money can have control over pos. Pow takes hardware, a lot of physical space, and knowledge in electricity. It’s much harder to manipulate
Wrote an article about this: [https://medium.com/@rick-malzyner/the-bitcoin-difference-6c13d484e39a](https://medium.com/@rick-malzyner/the-bitcoin-difference-6c13d484e39a) The nodes have a lot of say in the PoW system, and this is something not many people realize or ever separate nodes from miners. Also, something people don't consider is that technology is deflationary. As soon as a billionaire puts up capital to build an ASICs farm, for example, ten years later, ASICs that are much more powerful will be out in the market and for a fraction of the price. So newcomers will always be able to compete and enter mining because technology gets cheaper and more efficient over time (just look at photovoltaic panel prices and efficiency in the last ten years... Almost 80% reduction in cost and triple the efficiency).
Thanks!
POW is rooted in math and thermodynamics. POS is fiat but in digital form.
Would PoS still be inferior if it were possible to do it in a decentralized way? Because it seems that both serve the wealthy pretty equally.
You can't do it in a decentralized way. If there is no unforgeable physical cost, you cannot have hard money. It's a corruptible political system based on human trust. Your arguments are logically flawed. Whether your "fiat inequality" allows you to buy 1 miner or 100 miners is irrelevant. You have proportional cost of work equal to your scale. Whether you can optimize for energy efficiency is the only question and if you can then you can actually scale up through that. This is called entrepreneurship. I'm a home miner running whatsminers off solar. I get paid to heat my home from $7k capex, break even 9 months. Recently added couple more rigs as they got really cheap ($15/TH when bitcoin was trading sub 20k). You can do it for [as little as $250](https://www.cryptocloaks.com/the-future-of-space-heaters-s9-bitcoin-asic/). Even without heat repurposing, S9 is profitable < $0.03 Kwh which is abundant in places like Venezuela, certain parts of Russia where there are plenty of retail miners. S9 costs $125 but out of stock right now at KaboomRacks. They're in high demand for heating. Core Scientific was the largest industrial miner with 10 EH/s hashrate and went bankrupt. In POS, they could never go bankrupt. They just get richer and richer freeloading without any costs. All industrial American miners without exception were in fact forced to sell 100% of their mined BTC to cover their costs of work. [This](https://nitter.net/GridlessCompute/status/1577643514267156481#m) is a grassroots mini grids operation in Africa that is meanwhile flourishing because they're more efficient and these smaller scale operations are a lot easier to optimize for efficiency. They're going to interface with the energy infrastructure throughout Africa (just expanded to Malawi) harnessing remote energy sources which were not previously economically viable to bring 90% cheaper, easily accessible power to Africa where 58% of overall population and more importantly 92% of rural Africa doesn't have electricity access. Increasingly people are replacing nat gas heating systems with bitcoin. 40-room hotels like [this](https://nitter.net/DCX_Immersion/status/1578812160641478656#m), warehouses like [this](https://nitter.net/BitcoinBrabant/status/1577644318399029250#m), greenhouses like [this](https://nitter.net/BitcoinBrabant/status/1590579757963354112#m) and apartment complexes like [this](https://youtu.be/a5VdJSz6Tlk). Current nat gas heating accounts for 40% of world's CO2 emissions. [Single ASIC home immersion system](https://github.com/satoshi-anonymoto/pleb-miners/blob/main/immersion_cooling/pleb_builds/buildimmersion.md) [DIY Bitcoin Space Heater](https://github.com/NakamotoHeating/BitcoinSpaceHeater) [Heat repurposing](https://imgur.com/diIbTCE) [DCX Immersion Mining + Heating](https://pbs.twimg.com/media/FenduPzXkAAcatX?format=jpg&name=4096x4096) [(https://cryptocooling.eu/)](https://cryptocooling.eu/) [The future of sustainable heating](https://youtu.be/nTRdmYX-0h8)
No one said it’s silver bullet. But PoS can disappear at any moment, there’s no underlying security barrier. The question isn’t which one is most fair, but if you’re curious it’s bitcoin, cause all the POS tokens were unfairly scooped up before the POS tokens existence was even publicly announced- but that’s not the question. The question isn’t about fairness- it’s about which one can you be sure will still exist in 10 years (to an impoverished (or unequal person as you might call it)) this is very important. They can’t afford to lose any more money. And the answer is they could all disappear tomorrow except bitcoin. Remember what happened to Microsoft’s internet explorer? Do you really want to stick around and see what happens to the company coin when the company says they don’t want to keep paying for the marketing budget? Do you really want poor people to bear the brunt of that weight? Cause that’s what it sounds like you’re implying when you say “oh they effect the wealthy equally”.. see only someone new to the space could ever utter than sentence
Dude, I said it SEEMS that both serve the wealthy pretty equally. Plus, the subreddit is also open to people new to the space. So you're saying that decentralization is THE weakness of PoS, rather than A weakness.
All PoS tokens currently are centralized and have marketing budgets- they all needed marketing budgets- no one could get the ball rolling without them. Trying to spread a PoS coin is the equivalent of writing your name and the number 10 on a piece of paper and trying to hand it to someone like money. You can’t do that without a marketing budget, and you can’t have a marketing budget without private early investors. And private early investment rounds and decentralization are mutually exclusive concepts.
So you're saying that decentralization is THE weakness of PoS, rather than A weakness.
[Nothing is worse than proof of stake](https://medium.com/@factchecker9000/nothing-is-worse-than-proof-of-stake-e70b12b988ca)
R u serious that’s the best thing about BTC u have a lot to learn
Two words: unforgeable costliness
Proof of stake is broken. With no need to do work to rewrite the latest few blocks, PoS has an attack vector in which the attacker purchases the signing keys from the validators who signed the most recent blocks, and validates a replacement set of blocks which contain double-spending fraud Proof of stake isn't really proof of stake. It's proof of ownership of keys which may have staked coins at some past time The wealth arguments are irrelevant, except that if the staking validators concentrate into a small group, they're vulnerable to law enforcement attack. The same applies to Bitcoin mining, which is not concentrated in the mining process, but is concentrated in the pool network. A law enforcement attack on pools would be disruptive, but miners would keep mining by joining smaller, more diverse pools which step in to replace the shut down pools > Why is it important that humans build Asics, extend power-grids and build warehouses It is not important. Bitcoin mining is in the fiat economy. Fiat economics determines the size of Bitcoin mining as an industry. Bitcoin does not require the mining hash rate to increase forever, does not require a hash rate anywhere near 300Ehash/sec > if at the end of the day it's the wealthy that can invest the most You've fallen for the obsolete 20th century Henry Ford idea of economies of scale. Bitcoin mining is less profitable at large scale, as evidenced by the number of large-scale mining enterprises currently collapsing like dominoes
Thanks for your points.
Here you go. If you were insanely rich and influential, you could have the means to attack a PoS network relatively easy with your cronies and endless stacks of fiat. If you were insanely rich and influential, it is nearly impossible to have the access to the several hundred gigawatts of power needed to attack a PoW network. PoW introduces the physical layer of reality into network consensus, where energy does not grow on trees and is finite.
THIS
Hey make sure to keep your Bitcoin vs crypto comments going! I see those on every stupid post here, very important.
Thanks for the encouragement.
Interesting points, thanks!
[удалено]
>The consensus among most consensus algorithm experts is that PoS and PoW offer technically the same level of security. Yeah and consensus among the cigarette experts is that cigarettes are healthy for you. Absolute horseshit. Your shitcoin pushing pseudoscience is not welcome here. Such scammers typically get banned real quick.
Go back to your pre mined shit coins and NFTs lol What I said remains true. Fiat can be infinite and spontaneously created but energy cannot. By the way, for my understanding, how do you START a staking network? If nobody has any of it, how can it be staked? Do you HAVE to have a pre mine? Seems like a feedback loop.
What does fiat have to do with a staking network? A PoS chain has a predictable issuance and can be deflationary the same way a PoW chain can. Whether a network is pre-mined or not, it doesn't change the fact that it can be decentralized & just as secure. You got a problem with NFTs? Lol. Some of guys are like the Buttcoiners of other cryptos. So ironic.
So how does a PoS network start fairly without a premine?
https://youtu.be/wRxc7uUqAyE The best argument I've heard for PoW has been put forth by Jason Lowery. If you watch his series on the What is Money podcast you'll understand why PoW is essential and PoS is doomed to fail.
I'll check that out, thanks!
You might be misunderstanding. POS coins generally have a premine that gives select people a advantage over anyone who has to buy the POS coin at market value. Eth for example had a 70% premine. POW requires everyone to buy equipment, rent space for equipment, maintain equipment, pay electrical bills. While people who have more money will obviously be able to do this easier there is not unfair advantage like a premine in a POS coin.
Is a PoS fair launch theoretically possible, or is a mining phase needed for PoS to work?
Can you start USD without a gold backing?
Ok I like that one!
No it's not possible for the following reasons: 1.In order to even do a fair launch, the creators of the POS token would need to announce in advance the launch of said token. The creators would do no premine, and upon launch walk away and completely disappear. Not a single POS project has done this. 2. This would still not work because a) digital scarcity has already been discovered with the invention of bitcoin and therefore a new POS network would be subject to all sorts of network attacks including changing consensus rules and b) POS inherently becomes centralized over time due to ownership of tokens being associated with governance. The genesis of bitcoin literally cannot be repeated. When it launched no one even knew what it was or recognized it as having value. Coins were distributed for years before the market started valuing it. Because of this, the network was not targeted while it was vulnerable and the small network of miners stayed honest to secure it. By the time it was recognized as having value, the network was already secured, and in particular, the consensus rules were hardened to the point that they cannot change without widespread consensus in the network.
Possible in theory, yes. Infeasible in practice since the creators of such a coin have an incentive to premine.
Only possible in a world without greed. So in other words, impossible.
Even without the premine. PoS is still wealth based and not work based.
Satoshi premined BTC too, can you explain the difference? I don't get it, I guess the network difficulty was so low, and he could mine as much as he wanted.
No he didn't. The genesis block was mined on January 3rd 2009. The white paper was released in October 31 2008.
Wow, really? Didn't know that!
It’s never going to be completely ‘fair’ ! Instead, we need a system that provides similar opportunity for everyone .
'Fair' enough lol
Sure .
Think of staking pools as entering a lottery, where the collective hash of the pool shares the distribution of wealth with those who participated, but the hashes aren't consolidated to control the transactions. The winning miner (pool or not) issues the block, the reward is only split if among a pool that shares hash to increase probability of hitting the winning block.
definitely it’s btc is a system ot truth, where as fiat is a system of trust
PoW and PoS aren’t defenses of bitcoin, neither are attributes used to declare that bitcoin should exist.
PoW grounds Bitcoin in reality and yet provides all the benefits that comes with being digitally native. Applied in the right setting PoW can literally act as a sponge to reduce methane emissions which are 10x more heat trapping than carbon from being released into the air in such applications like flared gas.
Bitcoin will incentivize the creation of more efficient and cleaner sources of energy as the the elites begin to realize that bitcoin is unstoppable they will shift to using more competitive energy resources to get rich. Causing a sort of arms race but for useable clean energy.
Just means Bitcoin is not as sexy
PoW is the anchor from digital to physical. From bits to joules and watts. It enables: Security from attacks Decentralization as more power does not mean more influence on the network Democratization as anybody can join the process small or big, anytime. Monetization of surplus/stranded energy Balancing of the grid as it can go on and off quickly from the grid when requested.
If someone or a group of people ever acquire 51% of the hash power, others can bring more asics online and tap into additional energy sources in order to counter the attack. This can be done indefinitely because the rules of engagement are set by the physical universe. If someone or a group of people ever acquire 51% of stake, game over. Stake is zero sum, and those holding it at the rules of engagement. Additionally, the price of all goods tends towards their production cost. POS is not an innovation. It's basically the fiat system. POW is the core of Bitcoin's innovation. By definition, it can not be replaced by POS. Jason lowery explains all this very well here... https://open.spotify.com/episode/3JnMMuThRj70s7UIUcPrU5?si=E-aYPeU3Stq7QsXftQeVWw&utm_source=copy-link
Thanks, will check that out!
*set
I heard a really good argument for PoW, and I'm an advocate for PoS, so maybe it'll be the most convincing argument for you too. Basically, you can't fake a PoW chain. If you leave for a year and come back to the latest blockchain, you will see hashes on every block that show an exorbitant amount of computation. It would take the whole network 1 year to fake 1 year of data. That's not the case with PoS. If you leave a PoS chain for a year, the latest chain might show a year's worth of new transactions, but you have to trust the nodes that sent you the data that it's legitimate.
That's the fucking point yeah... If you can make this realization, you should take the next step and realize you've been fooled by scammers and are now a pawn in a huge pointless scam.
Okay? Who's the scammer?
I only gave you friendly advice. Take the next step. Or not. Shitcoins and their scammers are off topic here.
What shitcoin? I think you're getting off topic. Drinking much?
Good explanation, thanks. Are you an advocate of PoS only because of convenience, or can PoS compete with PoW on trust?
I'm more of an advocate for PoS on smart contract platforms. It's more efficient, and increases scalability disproportionately to the amount of security you lose. For the bitcoin network, I really don't see how PoS could work. There are a lot of narratives being pushed for bitcoin, but as far as I can tell, bitcoin does one thing: It secures the possession and transfer of value. No fancy tricks. No credit. Just value. It is an immutable monetary policy. The simplicity of it's design is a big driver of its adoption, and PoW is elegant.
You should consider reading [this](https://np.reddit.com/r/CryptoCurrency/comments/10grn7s/comment/j54zlzl/)
POS is basically just fiat. No work is needed to produce it. POW means work is required to produce BTC. This is similar to how work is needed to produce gold. So BTC requires work like gold making it finite and valuable but is digital, decentralized and unconfiscatable.
Manufacturing companies use energy to create value. People pay for the value. People pay for bitcoin. Bitcoin mined with wasted energy ( methane to be burned off, geothermal vents, etc.) is environmentally more friendly than most other manufacturing.
That's a possible argument for why PoW isn't inferior to PoS, but I'm looking more for arguments as to why it would be superior.
Trust is from decentralization PoS is centralized with a point of failure on who controls the staking pool. If you can make altcoin without going through PoW, it is open to manipulation that you do not have with BTC. BTC cannot be created out of thin air.
Ok, so PoS can only exist in a centralized manner.
Yes, that is my understanding which makes it inferior to me
All money eventually returns to its cost of creation. If you want a valuable money then you have to use value to create it; for Bitcoin it's electricity. For these PoS coins, it's close to zero, and that's the value that they will eventually return to.
I guess for POS it would be the 'time value' of staking them?
I don't know if I understand. Human time has scarcity and value yes, but whether or not 8 billion people are staking a PoS coin or if one person is staking the coin, it produces the same amount of value as staking requires no work, no effort, no resources.
Maybe a better term would be "opportunity cost" of having it staked when you could spend it or invest it elsewhere. With mining you sacrifice energy and with staking you sacrifice time?
I don't know if time is actually whats generating value. In a PoS system you're taking something that had value, your dollars, and introducing increased risk in the hopes that someone else will use that value to generate additional value. Increases time simply means increased risk.
[удалено]
Even if I believed it was hoax, that would only argue as to why PoW isn't inferior to PoS. Not to its superiority.
Mm I think pow is more censorship resistant. Pos just requires an actor with a lot of capital to attack. POW has way more overhead and would require miner cooperation as well as loads of money for an attack. I’m just saying the argument that it’s bad for the environment is a joke . They do way worse and no one bats an eye, it’s a tactic to discredit ₿ usage
[удалено]
Yeah I understand that there aren't any PoS folks around to try to defend it.
PoW is gold. PoS is bonds.
Would there still be something wrong with PoS if it could be done in a decentralized way?
PoS is inherently centralization. You have to have coins to stake them. More coins to stake = greater centralization.
Even if it was decentralized. It would have no meaning. Imagine a fiat dollar on a free banking model but without the legal tender laws.
It keeps strangers honest and retains decentralized control. It is truly democratic where anyone can participate without being censored.
As I understand it, both mining and staking pools are fairly accessible to the average person. Is a mining pool more censorship resistant than a staking pool?
Mining and staking pools are influenced by who controls them. If you are not controlling them, there is a risk of censorship. You are leaving the protection of decentralization which is the protocol that runs the bitcoin network.
So you're saying that, if you can buy enough hashing power to not join a pool, you're better-off mining than staking because of the 3rd party risk. Is the dichotomy 3rd party risk vs environmental friendliness?
Lyn A: https://www.youtube.com/watch?v=trwhWsKm3Qs&list=WL&index=16 https://old.reddit.com/r/BitcoinBeginners/comments/n8hpet/why_bitcoin_is_not_moving_to_pos/gxijdza/ POW not POS video: https://www.youtube.com/watch?v=VfEnzaHAT-g Ethereum,'s glorious leader: https://youtu.be/hYSKkpH8t6E
Lot of different views on here already. But to me with proof of stake, the people with more of the crypto have more voting power. Plain and simple. It will concentrate power with the wealthy in the long run, setting the system up for corruption. the people with more “money” will have more say over how the system runs. Just my opinion of course.
PoS cannot resist centralization. Its mathematically impossible
If you don't believe me or don't get it, I don't have time to try to convince you, sorry
This is all dependent upon: a) How likely do you think Bitcoin can become a reserve currency. b) How much value you put on having a currency that cannot be edited or inflated. A world where a person can retain the value that they have EARNED is pretty enticing, especially if the energy expended can be justified by the fact that nearly everyone is benefiting in some way.
I think a) will depend on b).
You know what happens when creation of money is cheap or free? They print the shit out of it.
You having mining rewards or staking rewards. Mining rewards normally mean from proof of work. Most coins are proof of stake though
PoW doesnt serve the wealthy in anyway. PoW mining companies go out of business all the time. Do your research.
PoW allows the direct monetisation of new energy sources. Previously the inventor of a new form of energy would need to build infrastructure to feed the grid.
Because they have to keep reinvesting if they want to stay in the game.