Annual 10% bitcoin dividends if mining were Proof-of-Stake - page 13.

SlipperySlope

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Stephen Reed

Quote from: Peter R on April 24, 2014, 09:31:25 PM

That being said, I am pleased that no one seems to agree on anything. I guess this means once again that things will just continue as they are (unless something actually breaks).

The thread poll also indicates a skeptical majority. I sent an email message to the bitcoin developer mail list asking for permission to branch the source code on the GitHub repository and begin researching a Proof-of-Stake version of Bitcoin. No comment so far. I noted that I understood that Proof-of-Stake is listed as as a prohibited yet disputed enhancement on the Bitcoin wiki. Prohibited features are those which break the social contract between the Bitcoin developers and Bitcoin users.

I am preparing to devote the next year or two at least to the branch. I will create a project in the Project Development sub-forum to transparently track progress. I will keep this thread and poll alive to engage and potentially educate anyone who is not a developer or technical expert.

As an indication of my commitment to this Bitcoin improvement project, I am now using my real name and recent photo where possible. I regret postponing my AI research, but the coding decisions I made years ago have stood the test of time, and will endure until I fund them with future bitcoin valuations.

Siegfried

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Quote from: Peter R on April 24, 2014, 06:54:48 PM

Quote from: jonald_fyookball on April 24, 2014, 06:47:39 PM

Quote from: Peter R on April 24, 2014, 06:18:21 PM

Quote from: jonald_fyookball on April 24, 2014, 06:14:34 PM

distribution...is that the main argument against POS?

OP seems to be implying everyone gets a 10% dividend.
Wouldn't that be the distribution?

It's not really distribution if it only goes to those already holding stake.

hows that any different than distribution coins only to those who already hold mining power?

PoW distributes coins to those who do the work. It doesn't matter how many bitcoins you hold.

It is really obvious if you think about the early days of bitcoin: if bitcoin was PoS, Satoshi would of had to give away or sell all the coins. Instead, he created an incentive system whereby people who didn't have coins could try to find them.

Another way of saying it is that PoW distributes coins to those who invest in mining equipment. PoS distributes coins to those invest in coins. It really doesn't seem that much different - invest in X, get coins. If PoW and PoS can both support the functioning and security of a cryptocurrency equally well, then PoS seems superior because it does not waste energy and would have a wider distribution than PoW.

Peter R

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Quote from: jonald_fyookball on April 24, 2014, 09:15:11 PM

Quote from: Peter R on April 24, 2014, 09:06:49 PM

Quote from: clout on April 24, 2014, 08:16:32 PM

for the remainder of your life bitcoin will be inflationary, it is absurd for you to support it just because there is a fixed supply at a very arbitrary point in the future. would you support us inflation just because the government says, in 125 years we will stop printing more usd?

Sarc: Yes, you're right! The fact that people can do work and be rewarded with coins is inflationary! Why bother distributing them to just anyone who is able to find them when we could create a PoS spin-off and keep more for ourselves!!

I have the perfect solution! I am going to create my own coin called PeterCoins. I will own all of them and I will reward myself with 50% dividends each year just for being me!! Each time I write a post here, I'll give myself a raise because I deserve it.

It is absurd that I would support any distribution of these coins, since I can just keep them for myself. I'm not even going to sell any because they are going to be worth sooooooo much as soon as people realize the benefits.

I think we should all do this. We should all own 100% of our own personal PoS coins and since we have 100% stake, we get to make the rules. We can give ourselves as much money as we like! And if we never sell them, the supply is zero and the price is therefore infinite.

Yeah!!!!!

In case anyone missed that, I was being sarcastic. Mining is the technique we use to efficiently distribute bitcoins. The legitimacy of the entire distribution system fails if a coin does not use mining. The inflation from mining acts to drive the price down when it gets too far ahead of itself, and acts to keep the coin alive when people lose interest. Mining reduces volatility and acts to distribute coins efficiently to people who actually want them.

Think: would you really buy PeterCoins from me? PoS is the same idea except is it (Peter+Joe+…Bob)Coins. The more I think about PoS the less legitimate the concept seems. You are basically trying to get people to buy into your special shares, but if your shares are so special why are you selling them?

I think you are sensing the psychological advantage of pow. New adopters value pow. That's part of what convinced me about bitcoin ...seeing it wasn't just some digital creating, but something was solved.

Sure, in fact I believe anything other than PoW would be perceived as illegitimate. Its funny: I remember last spring people were complaining there wasn't enough inflation. People argued that too many coins were mined in too short a time. But now we are talking about the opposite: creating a PoS spin-off to cut off the supply completely.

It will be interesting to watch the first PoS spin-offs from bitcoin. They might actually get a big pump due to the restricted supply. But I expect they will collapse in the end because (a) the PoS coin will need genuine adoption to grow, yet (b) why would I buy your coin if you need me more than I need you?

That being said, I am pleased that no one seems to agree on anything. I guess this means once again that things will just continue as they are (unless something actually breaks).

jonald_fyookball

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Core dev leaves me neg feedback #abuse #political

Quote from: Peter R on April 24, 2014, 09:06:49 PM

Quote from: clout on April 24, 2014, 08:16:32 PM

for the remainder of your life bitcoin will be inflationary, it is absurd for you to support it just because there is a fixed supply at a very arbitrary point in the future. would you support us inflation just because the government says, in 125 years we will stop printing more usd?

Sarc: Yes, you're right! The fact that people can do work and be rewarded with coins is inflationary! Why bother distributing them to just anyone who is able to find them when we could create a PoS spin-off and keep more for ourselves!!

I have the perfect solution! I am going to create my own coin called PeterCoins. I will own all of them and I will reward myself with 50% dividends each year just for being me!! Each time I write a post here, I'll give myself a raise because I deserve it.

It is absurd that I would support any distribution of these coins, since I can just keep them for myself. I'm not even going to sell any because they are going to be worth sooooooo much as soon as people realize the benefits.

I think we should all do this. We should all own 100% of our own personal PoS coins and since we have 100% stake, we get to make the rules. We can give ourselves as much money as we like! And if we never sell them, the supply is zero and the price is therefore infinite.

Yeah!!!!!

In case anyone missed that, I was being sarcastic. Mining is the technique we use to efficiently distribute bitcoins. The legitimacy of the entire distribution system fails if a coin does not use mining. The inflation from mining acts to drive the price down when it gets too far ahead of itself, and acts to keep the coin alive when people lose interest. Mining reduces volatility and acts to distribute coins efficiently to people who actually want them.

Think: would you really buy PeterCoins from me? PoS is the same idea except is it (Peter+Joe+…Bob)Coins. The more I think about PoS the less legitimate the concept seems. You are basically trying to get people to buy into your special shares, but if your shares are so special why are you selling them?

I think you are sensing the psychological advantage of pow. New adopters value pow. That's part of what convinced me about bitcoin ...seeing it wasn't just some digital creating, but something was solved.

Siegfried

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Quote from: clout on April 24, 2014, 08:16:32 PM

Quote from: CoinHoarder on April 24, 2014, 07:41:53 PM

Quote from: BldSwtTrs on April 24, 2014, 07:38:16 PM

Quote from: CoinHoarder on April 24, 2014, 07:34:37 PM

No pun intended, but you are embarking upon a slippery slope.

Please leave Bitcoin the way it is- we don't need no stinkin' 10% annual inflation. To put it into perspective the US dollar currently inflates at around 1% annually.. 10% is just a ridiculous number.

You get it upside down.

Currently, Bitcoin money supply inflate +10% a year. Fixed money supply + X% dividends equal X% deflation a year. PoW is inflationnist, PoS is deflationnist.

Good point.

However, the 10% a year number will slowly decrease to 0% over time.

I see no mention in the proposal to allow for a slow decrease in the dividend percentage to mimic the future rate of minting.

Also, I see the bigger problem being people losing trust in Bitcoin (which I just edited into my previous post- see above).

for the remainder of your life bitcoin will be inflationary, it is absurd for you to support it just because there is a fixed supply at a very arbitrary point in the future. would you support us inflation just because the government says, in 125 years we will stop printing more usd?

we are making the proposal that you do not have to pay a 10% dividend at all. dividends are paid for by transaction fees which are burned.

bitcoin is not the end all and be all of the crypto currency space. it is just the beginning. so many ppl talk about not trying to reinvent the wheel, but that logic is antithetical to the bitcoin/crypto currency movement. the idea is to reinvent everything that needs to be reinvented. in this case that includes bitcoin.

You could also say that 21 million BTC exist now, but only 12 million have been mined (available to be spent). That is quite different than a fiat currency, where 20 years later the money supply could be 50, 100, 500, 1000, or 5000 percent greater than it is today. The Bitcoin market has absorbed the money supply information and it is factored into the price; the fiat market cannot absorb money supply information because there can be no certainty or even close approximation of money supply in the long-term.

Peter R

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Quote from: clout on April 24, 2014, 08:16:32 PM

for the remainder of your life bitcoin will be inflationary, it is absurd for you to support it just because there is a fixed supply at a very arbitrary point in the future. would you support us inflation just because the government says, in 125 years we will stop printing more usd?

Sarc: Yes, you're right! The fact that people can do work and be rewarded with coins is inflationary! Why bother distributing them to just anyone who is able to find them when we could create a PoS spin-off and keep more for ourselves!!

I have the perfect solution! I am going to create my own coin called PeterCoins. I will own all of them and I will reward myself with 50% dividends each year just for being me!! Each time I write a post here, I'll give myself a raise because I deserve it.

It is absurd that I would support any distribution of these coins, since I can just keep them for myself. I'm not even going to sell any because they are going to be worth sooooooo much as soon as people realize the benefits.

I think we should all do this. We should all own 100% of our own personal PoS coins and since we have 100% stake, we get to make the rules. We can give ourselves as much money as we like! And if we never sell them, the supply is zero and the price is therefore infinite.

Yeah!!!!!

In case anyone missed that, I was being sarcastic. Mining is the technique we use to efficiently distribute bitcoins. The legitimacy of the entire distribution system fails if a coin does not use mining. The inflation from mining acts to drive the price down when it gets too far ahead of itself, and acts to keep the coin alive when people lose interest. Mining reduces volatility and acts to distribute coins efficiently to people who actually want them.

Think: would you really buy PeterCoins from me? PoS is the same idea except is it (Peter+Joe+…Bob)Coins. The more I think about PoS the less legitimate the concept seems. You are basically trying to get people to buy into your special shares, but if your shares are so special why are you selling them?

jonald_fyookball

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Core dev leaves me neg feedback #abuse #political

Quote from: mgburks77 on April 24, 2014, 07:16:10 PM

yeah but that incentive has been warped by the need for specialized equipment and the work is essentially useless and a waste of resources.

I agree, and at this point, Bitcoin is big enough and known enough -- there is no
incentive system any more in the original sense when Satoshi created it.
At this point, you either spend lots of money to mine or you buy coins.

mgburks77

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Quote from: SlipperySlope on April 24, 2014, 07:32:06 PM

Quote from: jonald_fyookball on April 24, 2014, 05:36:42 PM

Hmm... Seems to be related to the "pos scheme still needs a pow issuance mechanism" argument that meni made yesterday in this thread https://bitcointalk.org/index.php?topic=27787.0;all

My point being maybe we need elements of both pos and pow

Thanks so much for the links which I am bookmarking now for analysis later.

I posted a message to the bitcoin developers mail list asking for permission to branch Bitcoin Core for the purpose of researching Proof-of-Stake, while finding its vulnerabilities and fixing them.

A public dairy of the research could be published on in the Project Development sub-forum - "Bitcoin Proof-of-Stake Project".

Just have an initial mining period, like say 45 days, for the initial distribution. You won't have much trouble generating interest in the project, I'd say.

clout

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Quote from: CoinHoarder on April 24, 2014, 07:41:53 PM

Quote from: BldSwtTrs on April 24, 2014, 07:38:16 PM

Quote from: CoinHoarder on April 24, 2014, 07:34:37 PM

No pun intended, but you are embarking upon a slippery slope.

Please leave Bitcoin the way it is- we don't need no stinkin' 10% annual inflation. To put it into perspective the US dollar currently inflates at around 1% annually.. 10% is just a ridiculous number.

You get it upside down.

Currently, Bitcoin money supply inflate +10% a year. Fixed money supply + X% dividends equal X% deflation a year. PoW is inflationnist, PoS is deflationnist.

Good point.

However, the 10% a year number will slowly decrease to 0% over time.

I see no mention in the proposal to allow for a slow decrease in the dividend percentage to mimic the future rate of minting.

Also, I see the bigger problem being people losing trust in Bitcoin (which I just edited into my previous post- see above).

for the remainder of your life bitcoin will be inflationary, it is absurd for you to support it just because there is a fixed supply at a very arbitrary point in the future. would you support us inflation just because the government says, in 125 years we will stop printing more usd?

we are making the proposal that you do not have to pay a 10% dividend at all. dividends are paid for by transaction fees which are burned.

bitcoin is not the end all and be all of the crypto currency space. it is just the beginning. so many ppl talk about not trying to reinvent the wheel, but that logic is antithetical to the bitcoin/crypto currency movement. the idea is to reinvent everything that needs to be reinvented. in this case that includes bitcoin.

CoinHoarder

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In Cryptocoins I Trust

Quote from: BldSwtTrs on April 24, 2014, 07:38:16 PM

Quote from: CoinHoarder on April 24, 2014, 07:34:37 PM

No pun intended, but you are embarking upon a slippery slope.

Please leave Bitcoin the way it is- we don't need no stinkin' 10% annual inflation. To put it into perspective the US dollar currently inflates at around 1% annually.. 10% is just a ridiculous number.

You get it upside down.

Currently, Bitcoin money supply inflate +10% a year. Fixed money supply + X% dividends equal X% deflation a year. PoW is inflationnist, PoS is deflationnist.

Good point.

However, the 10% a year number will slowly decrease to 0% over time.

I see no mention in the proposal to allow for a slow decrease in the dividend percentage to mimic the future rate of minting.

Also, I see the bigger problem being people losing trust in Bitcoin (which I just edited into my previous post- see above).

Adrian-x

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Quote from: mgburks77 on April 24, 2014, 07:16:10 PM

yeah but that incentive has been warped by the need for specialized equipment and the work is essentially useless and a waste of resources.

what came first? the specialized equipment that is resource efficient but expensive (a result of XBT=$500) or the inefficient CPU (XBT=$0.01) remember bitcoin is still in the early stage of distribution, Big mining operations are similar to the early miners in 2009, they are not guaranteed anything, and they are building the fundamental infrastructure on nothing but faith.

A solution to this problem exists its just not Proof-of-Stake.

The problem is actually in the value of bitcoin, that is what is driving this crazy behavior.

BldSwtTrs

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Quote from: CoinHoarder on April 24, 2014, 07:34:37 PM

No pun intended, but you are embarking upon a slippery slope.

Please leave Bitcoin the way it is- we don't need no stinkin' 10% annual inflation. To put it into perspective the US dollar currently inflates at around 1% annually.. 10% is just a ridiculous number.

You get it upside down.

Currently, Bitcoin money supply inflate +10% a year. Fixed money supply + X% dividends equal X% deflation a year. PoW is inflationnist, PoS is deflationnist.

CoinHoarder

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Activity: 1484

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In Cryptocoins I Trust

No pun intended, but you are embarking upon a slippery slope.

Please leave Bitcoin the way it is- we don't need no stinkin' 10% annual inflation. To put it into perspective the US dollar currently inflates at around 1% annually.. 10% is just a ridiculous number.

Also this would leave many ASIC companies and purchasers with useless equipment and there would be some blow back suffered from the harm this would do to the way people trust Bitcoin. When you change the rules as you go, people may not be so apt to invest in Bitcoin. The rules were written a long time ago and everyone here has accepted Bitcoin how it is today, why change it now? It would only lead to a loss of confidence.. in today's troubled market this would be very bad.

SlipperySlope

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Stephen Reed

Quote from: jonald_fyookball on April 24, 2014, 05:36:42 PM

Hmm... Seems to be related to the "pos scheme still needs a pow issuance mechanism" argument that meni made yesterday in this thread https://bitcointalk.org/index.php?topic=27787.0;all

My point being maybe we need elements of both pos and pow

Thanks so much for the links which I am bookmarking now for analysis later.

I posted a message to the bitcoin developers mail list asking for permission to branch Bitcoin Core for the purpose of researching Proof-of-Stake, while finding its vulnerabilities and fixing them.

A public dairy of the research could be published on in the Project Development sub-forum - "Bitcoin Proof-of-Stake Project".

mgburks77

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yeah but that incentive has been warped by the need for specialized equipment and the work is essentially useless and a waste of resources.

Peter R

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Quote from: jonald_fyookball on April 24, 2014, 06:47:39 PM

Quote from: Peter R on April 24, 2014, 06:18:21 PM

Quote from: jonald_fyookball on April 24, 2014, 06:14:34 PM

distribution...is that the main argument against POS?

OP seems to be implying everyone gets a 10% dividend.
Wouldn't that be the distribution?

It's not really distribution if it only goes to those already holding stake.

hows that any different than distribution coins only to those who already hold mining power?

PoW distributes coins to those who do the work. It doesn't matter how many bitcoins you hold.

It is really obvious if you think about the early days of bitcoin: if bitcoin was PoS, Satoshi would of had to give away or sell all the coins. Instead, he created an incentive system whereby people who didn't have coins could try to find them.

Peter R

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Activity: 1162

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Quote from: BldSwtTrs on April 24, 2014, 06:26:15 PM

Quote from: Peter R on April 24, 2014, 06:16:48 PM

Quote from: clout on April 24, 2014, 05:59:22 PM

no shares can't be created out of thin air

Nonsense. PoS is predicated on the notion that bitcoins require too much work to create, so you create a bunch of bitshares instead because they are easy to make.

This is the number 1 argument in favour of PoS: since bitshares are easier to create, PoS enthusiasts claim that we will waste less energy and make the world a better place (which I believe is also untrue).

How are they easier to create?

An agreement between 51% of shareholders to dilute their value is by no mean a realistic scenario.
With PoW miners vote proportionaly to their hashing power, with PoS stakeholders vote proportionaly to their stake. The difficulty to create token is not a question of entropy. Both with PoW or PoS, it's fundamentally a question to obtain a voting majority.
And arguably, obtaining 51% of hashing power is a lot easier than obtaining 51% of shares.

I've explained my point of view here several times already. It seems you disagree.

I would actually like to see a PoS alt-coin emerge with a larger market cap, BTW. PoS needs to succeed or fail when the stakes are higher. To solve the distribution problem and grow its market cap quickly, I think a dominant PoS coin should emerge by combining the blockchains of already-existing PoS communities using a modification of my "spin-off" proposal.

I think bitshares is a good name because that is what PoS is: shares.

jonald_fyookball

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Core dev leaves me neg feedback #abuse #political

Quote from: Peter R on April 24, 2014, 06:18:21 PM

Quote from: jonald_fyookball on April 24, 2014, 06:14:34 PM

distribution...is that the main argument against POS?

OP seems to be implying everyone gets a 10% dividend.
Wouldn't that be the distribution?

It's not really distribution if it only goes to those already holding stake.

hows that any different than distribution coins only to those who already hold mining power?

clout

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Quote from: Peter R on April 24, 2014, 06:16:48 PM

Quote from: clout on April 24, 2014, 05:59:22 PM

no shares can't be created out of thin air

Nonsense. PoS is predicated on the notion that bitcoins require too much work to create, so you create a bunch of bitshares instead because they are easy to make.

This is the number 1 argument in favour of PoS: since bitshares are easier to create, PoS enthusiasts claim that we will waste less energy and make the world a better place (which I believe is also untrue).

no its not, you're making assumptions that are not true. pos and pow are not predicated on coin distribution, they are predicated on consensus. you don't even understand the technology, how then can we argue the economics of it?

BldSwtTrs

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Quote from: Peter R on April 24, 2014, 06:16:48 PM

Quote from: clout on April 24, 2014, 05:59:22 PM

no shares can't be created out of thin air

Nonsense. PoS is predicated on the notion that bitcoins require too much work to create, so you create a bunch of bitshares instead because they are easy to make.

This is the number 1 argument in favour of PoS: since bitshares are easier to create, PoS enthusiasts claim that we will waste less energy and make the world a better place (which I believe is also untrue).

How are they easier to create?

An agreement between 51% of shareholders to dilute their value is by no mean a realistic scenario.
With PoW miners vote proportionaly to their hashing power, with PoS stakeholders vote proportionaly to their stake. The difficulty to create token is not a question of entropy. Both with PoW or PoS, it's fundamentally a question to obtain a voting majority.
And arguably, obtaining 51% of hashing power is a lot easier than obtaining 51% of shares.

Topic: Annual 10% bitcoin dividends if mining were Proof-of-Stake - page 13. (Read 16700 times)