Topic: Annual 10% bitcoin dividends if mining were Proof-of-Stake - page 15. (Read 16688 times)

This actually makes a lot of sense to me.  It's similar to the idea of foregoing a mining venture when one can simply invest their money directly in buying coins.

Perhaps it would be more clear to write:

PoW : consensus is achieved by people who put their time and resources at risk; rewards flow to those who perform the most work.

PoS : consensus is achieved by people who have shares; rewards flow to those who have the most shares.

The thing you're missing is the difference between capital and capital at risk.  PoS rewards rent-seeking; PoW rewards efficient work.

peter i think you misunderstand what capital is. mining equipment is capital. bitcoins are capital. any resource, even labor or information, is capital. 

in pos, capital flows to those with capital. and pow captial flows to those with capital and economies of scale. you get the same result but at a much higher cost with pow.

You don't charge too much right away, of course.  You wait until you have a large user base, preferably with loans denominated in your shares too.  And then you increase the fees, or print more coins, or whatever you want since you're the dominant stake holders.

Your example of real corporations was good: the people with the most control always find a way to vote themselves more at the expense of the smaller share holders.  Hasn't this been proved time and time again?

For me:

PoW : consensus is achieved by people who put their time and resources at risk; rewards flow to those who perform the most work.

PoS : consensus is achieved by people who have capital; rewards flow to those who have the most capital.

PoW seems like the superior mechanism of establishing consensus in decentralized systems. 

I've seen these pictures, and have a same feeling as you looking at them: these are the people that will protect the bitcoin mining at any cost, not destroy it. I think they would go as far as restricting their own network hashing percentage, if the unlikely event that would be necessary. However, as time passes by they will have trouble keeping their < 10% of the hashrate, chances they can afford to continue investing and grow the percentage are slim, they have to cover the cost of investment sooner or later.

The dividends come from the transaction fees. If you charge too much fees nobody will use your DAC.

It's like a brick and mortar corporation, why Coca-Cola shareholders don't vote themselves 50% dividends per year?

You really need to grasp the analogy between blockchain technologies and autonomous corporations, that would avoid you to say wrong stuff such as PoS=rent-seeking. Shareholders of brick and mortar corporations are not rent-seeker, the same apply for the holders of blockchain tokens.

Because PoS gives financial authority to individual stakeholders, no sovereign nation would allow a global authority to control the flow of money. They would enjoy having such authority themselves, however. Therefore each nation, state, community, large corporation, and many individuals as well as financial institutions, brokers, etc. will issue each their own PoS coins with competitive incentives. Not only would people need wallets for their legal tender PoS coin, but they would always want the best deal they can get from all the others. Just the exchanges alone would need computing power greater than the PoW network for Bitcoin in order to keep them straight. Point of Sales would need to be able to differentiate between thousands, if not millions of currencies. The power resources needed to secure all those PoS alt coins would be enormous.

At least with all the PoW alt coins, nobody really takes them seriously because they are too insecure. Bitcoin derivative coins like Mastercoin simply use the one Bitcoin blockchain. Millions of clones can be created without adding additional power hungry nodes.

It's been argued several times in this thread: misallocation of capital leads to inefficient use of our natural and human resources.  

If you are going to reward yourselves 10%, why not 20%?  More is better right?  Since consensus is controlled by stake holders, why not vote yourself 50% dividends per year?  The more money you award yourselves, the more stake you gain, and the more control you achieve over the network.  You guys deserve it!  Think of the electricity you saved.  In the words of Goldman CEO Lloyd Blankfein, "you're doing God's work."

OK. Let's hear your argument.

Im a little late to this thread, but I just came here to drop this link:

http://bitshares.org/


bitshares is already a thing, and its very promising

I would argue that PoS adoption uses more electricity that a PoW global system.

This.

And PoW allocates capital more efficiently than PoS.  PoW rewards those who do the most work by risking their time and resources, rather than those who hold the most capital.  The electricity spent on PoW (that can go to useful heat) is dwarfed by the natural resources and human labour wasted when capital is misallocated (like we see in our current debt-based fiat system).

The bitcoin economy will be good for the environment. 

Oh c'mon. At least come up with something that hasn't been done before. Howabout a coin that pays compound interest calculated continuously?

You are toast 

It isn’t that bad, I believe PoW is called mining because it relates not to burning bank notes but to using energy to dig for gold.
I am sympathetic to your cause, my life and business is devoted to environmental sustainability, it is the allocation of capital that has the biggest impact on our environment, not consumer choices.

If Bitcoin mining is to compete for the finite energy available to sustain its exponential growth, we would see consumer’s preference for energy allocation change; this would bring about the necessary shift for long term sustainability we need.

I think your energy projection needs to be modeled with the existing economy in mind, just a rudimentary though experiment makes me quite excited for a sustainable future of abundance.

Firstly only the most efficient electronics will be used, as they will be orders of magnitude more efficient, I for one was still GPU mining over the winter as the heat cost was subsidised 20% by Bitcoin. But I believe this coming generation of ASIC’s will be significantly efficient to render that benefit obsolete next winter.  

So projecting on that understanding each subsequent generation will take an estimate of a year to deploy and 2 years to become obsolete and if the price of Bitcoin justifies it, competition will spark innovation, I have half a dozen investment opportunities available for the waste product Bitcoin promises to produce.  

Note planning for energy infrastructure to accommodate this projected energy demand is not happening, and if it was it would take a decade to implement.

This ASIC race will significantly accelerate the halving time in turn we could be seeing a reword of about 1.5 bitcoin in as little as 10 years. If consumers over that time learn to become incredibly efficient choosing to direct their entire national energy supply to Bitcoin production and forgo using it as we do today, they will be ready for the future.

On the topic of banning Bitcoin because it is considered ineffective energy usage, is hypocritical as electricity is being converted to heat everyday all over the world, what should happen in a free market is mining will not be centralised but distributed at the very leased to all those applications that use electricity to generate heat.    

I would take another btc position if it transitioned to PoS, otherwise I'm more interested in assets that explore concepts conducive to mass adoption such a fast transaction times, ease of use, ubiquitous mining, P2P exchange, true decentralization and true anonymity.

Security is always going to be a concern and I don't see that PoW is really any stronger in that respect because it requires a lot of trust in particular gate keepers to navigate the byzantine labyrinth that is the btc economy.

Someone can always rip your wallet file either way, unless YOU make it difficult.

No need for POS since we already have fiat money system where bankers have the biggest stake

Could you please elaborate on the nature to your objections. The public consensus cannot be moved towards Proof-of-Stake unless all objections are reasonably addressed.
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simple, i like it just as it is. thanks.
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I agree with the broad principles of conservatism. They have served my household very well over the decades.

Is it that a change has an unknown risk associated with it? And this risk to you is not worth the change I propose despite the assurances of my two arguments?

Hi everyone.

I added an opinion poll to the first page, to quantify how you feel about this issue.

The argument I make for the change has two independent points . . .

(1) The existing Bitcoin system of using Proof-of-Work to prevent double spending is wasteful, and growing so 10x worse each year. In about four more years at that rate, governments will take notice of the $100 billion worth of wasted electricity and perhaps ban bitcoin mining in some jurisdictions, using the incandescent light bulb ban as precedent.

(2) The alternative Proof-of-Stake method to prevent double spending can be performed on an ordinary computer, and probably in a few years on a smartphone. Proof-of-Stake allows each of us to expose bitcoins to the network and receive annual 10% dividends. Everything else about bitcoin, in particular the promises made by Satoshi concerning mining rewards and the fixed limit remain unchanged.

If you care one way or the other, please vote.

simple, i like it just as it is. thanks.