Annual 10% bitcoin dividends if mining were Proof-of-Stake - page 19.

jonald_fyookball

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Quote from: Peter R on April 23, 2014, 09:55:14 PM

Quote from: jonald_fyookball on April 23, 2014, 09:29:32 PM

good to know that's possible... still I think we should have some mechanism to enforce transactions being included...like the block itself cannot be forged without some kind of checksum against a pool of transactions. whats wrong with that idea?

Ideas like this have been debated for many years. It is sort of a "rite of passage" and it is important that people like you continue to ask them. The non-technical people in your sphere of influence will make up their mind about bitcoin based not on doing their research, but on listening to the opinions of people they trust like yourself.

The problem with a check against a pool of transactions is that the attacker could simply add a bunch of his transactions to the pool and only include those. Blocks would still get filled, but it would be useless to all of us. Add a new twist to your defence, and they'll be a new exploit.

I think there is no general solution to the Two Generals' Problem; the Satoshi model is a practical implementation that works provided honest nodes control more than 50% of the hash power.

From my understanding, most here believe we should find ways to incentivize "hashers" to become "miners" (e.g., using P2P pool). This is the goal to work towards, IMO.

Thanks Peter.

Yes, I realize I probably sound like a noob asking questions that have been debated for years but that's the only way one can learn. We are all advancing in knowledge on both an individual and group level.

I'm not smarter than anyone else here but we should all try to think of ideas and solutions. You never know who's brain will come up with a breakthrough. And as you said it's important to keep asking the core questions because it stimulates further thought among everyone.

Yes, more twists will be met with more exploits but that doesn't mean we can't tighten up the ship.

I do see your point about the pool. How do nodes decide how many transactions of the pool to include in the checksum and which ones? If we could solve that, would we be onto something?

Ron~Popeil

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A proof of stake system sounds like a decent idea. Although it would have some unintended consequences as well. There would be a new incentive to hoard BTC and would slow down the still infant BTC economy. If I am getting an automatic percentage just for holding my BTC it is much more likely to sit idle. Of course the additional coins created by the POS system would help a bit but I do think it would slow down the speed at which BTC moves around the world right now.

Peter R

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Quote from: jonald_fyookball on April 23, 2014, 09:29:32 PM

good to know that's possible... still I think we should have some mechanism to enforce transactions being included...like the block itself cannot be forged without some kind of checksum against a pool of transactions. whats wrong with that idea?

Ideas like this have been debated for many years. It is sort of a "rite of passage" and it is important that people like you continue to ask them. The non-technical people in your sphere of influence will make up their mind about bitcoin based not on doing their research, but on listening to the opinions of people they trust like yourself.

The problem with a check against a pool of transactions is that the attacker could simply add a bunch of his transactions to the pool and only include those. Blocks would still get filled, but it would be useless to all of us. Add a new twist to your defence, and they'll be a new exploit.

I think there is no general solution to the Two Generals' Problem; the Satoshi model is a practical implementation that works provided honest nodes control more than 50% of the hash power.

From my understanding, most here believe we should find ways to incentivize "hashers" to become "miners" (e.g., using P2P pool). This is the goal to work towards, IMO.

mgburks77

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Quote from: Paladin69 on April 23, 2014, 08:12:28 PM

Proof of Stake is socialist. It creates money out of thin air without working for it. Like a bank.

Bill O'Reilly over here lol

It's not functionally different than how mining creates bitcoins. Both provide payment for securing the network. The main difference is that PoS doesn't waste a bunch of electricity in doing so.

If you want to get technical linking value to labor performed is the basis of the labor theory of value and is the antithesis of free market economics which are informed by the view that value is a completely subjective characteristic, determined only by the interaction between buyer an seller in the open market. Markets are all about price discovery, not a predetermined value based on performed labor.

jonald_fyookball

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good to know that's possible... still I think we should have some mechanism to enforce transactions being included...like the block itself cannot be forged without some kind of checksum against a pool of transactions. whats wrong with that idea?

jonald_fyookball

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Peter R

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Quote from: jonald_fyookball on April 23, 2014, 08:20:09 PM

...I do think the protocol should have something in place to prevent transactions from being permanently excluded in the case of a sustained 51% / mining monopoly.

It does, and it will get stronger over time. The protocol is consensus. Right now the consensus is:

- Control of coins is proved by ECDSA signature
- Double-spends are eliminated with blockchain PoW timestamp server
- PoW is based on SHA256 hashing
- New coins are created as per the original Satoshi inflation model

All of this can change and will change if necessary. For example, in the extremely unlikely case that an unrelenting 51% attack took place, a bitcoin spin-off could be created using the latest version of the blockchain but with script hashing instead and with difficulty reset to 1 something low enough to entice miners. Most people with script hashers would start mining these new bitcoins like crazy because difficultly would be so low. Users won't care because all their coins are still valid. Blockchain.info and Coinbase wallet users probably won't even know that anything changed.

jonald_fyookball

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I'm not saying proof of stake is the answer necessarily, but I do think the protocol should have something in place to prevent transactions from being permanently excluded in the case of a sustained 51% / mining monopoly.

Paladin69

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Proof of Stake is socialist. It creates money out of thin air without working for it. Like a bank.

jonald_fyookball

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Quote from: cbeast on April 23, 2014, 06:51:38 PM

Quote from: jonald_fyookball on April 23, 2014, 05:16:33 PM

Where did you come up with $1 billion?

I can buy a CoinTerra TerraMiner IV which gets 2 TH/s for $5999.
Thats $3000 for 1 THs.

At that rate, I can get 60 PH/s (the entire current bitcoin network)
for 180 million. And arguably, it would be much cheaper for
a bulk order and working directly with core component manufacturers.

Even if it was a cool billion, that's not much
for a government. Heck, the freakin
state of illinois just decided to spend 100 million
on a library for Obama.

http://www.breitbart.com/Big-Government/2014/04/18/Illinois-Taxpayers-to-Give-100-Million-for-Obama-Library

This is true in theory, but not practice. Mining gear is usually obsolete by the time it ships. By the time you get your gear it will be inadequate. But, if money is no problem, then why not hire your own scientists and develop the next generation ASICs and build a secret fab to produce them? You could build it at the South Pole and import exotic animals for your tropical undergound zoo. You might have to kick out the Nazis first.

So sure are you? I could have said the same thing 2 years ago: "it's true in theory but not in practice" if one suggested that a large exchange could go bankrupt and the CEO could steal/lose hundreds of thousands of coins...and sounded just as credible.

cbeast

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Let's talk governance, lipstick, and pigs.

Quote from: jonald_fyookball on April 23, 2014, 05:16:33 PM

Where did you come up with $1 billion?

I can buy a CoinTerra TerraMiner IV which gets 2 TH/s for $5999.
Thats $3000 for 1 THs.

At that rate, I can get 60 PH/s (the entire current bitcoin network)
for 180 million. And arguably, it would be much cheaper for
a bulk order and working directly with core component manufacturers.

Even if it was a cool billion, that's not much
for a government. Heck, the freakin
state of illinois just decided to spend 100 million
on a library for Obama.

http://www.breitbart.com/Big-Government/2014/04/18/Illinois-Taxpayers-to-Give-100-Million-for-Obama-Library

This is true in theory, but not practice. Mining gear is usually obsolete by the time it ships. By the time you get your gear it will be inadequate. But, if money is no problem, then why not hire your own scientists and develop the next generation ASICs and build a secret fab to produce them? You could build it at the South Pole and import exotic animals for your tropical undergound zoo. You might have to kick out the Nazis first.

Littleshop

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Quote from: Brangdon on April 23, 2014, 04:20:33 PM

The kind of attack that concerns me is someone spending $100m or so on new hardware, not part of any pool, and thus gain over 51% percent. They then private mine empty blocks until they have a chain say 3 hours long. Then they publish it. At which point, all the transactions in those blocks, some of which had 18 confirmations, suddenly have zero confirmations. They all become vulnerable to double-spend attacks by their original senders. The attacker continues mining blocks, now including any double-spends. They do this once a day, at random times, from different IP addresses, for the next six months.

Spending $100 million to fuck up Bitcoin? If it could be done for 10 million (which it can't) I doubt anyone would take up on that offer. You can do a lot of things with 10 million that benefit yourself or make even more money. Doing an attack that you describe basically burns most of the money.

peligro

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1NoBanksLuJPXf8Sc831fPqjrRpkQPKkEA

I have to keep the Bitcoin wallet open and I will have a chance to collect more?

bwmedia

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Pos is a great idea. It rewards each full node for staying on right?

You dont have to have 51% of hash power, perhaps 51% of the full nodes Cheesy

itod

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Quote from: jonald_fyookball on April 23, 2014, 05:16:33 PM

I can buy a CoinTerra TerraMiner IV which gets 2 TH/s for $5999.
Thats $3000 for 1 THs.

At that rate, I can get 60 PH/s (the entire current bitcoin network)
for 180 million. And arguably, it would be much cheaper for
a bulk order and working directly with core component manufacturers.

No you can't buy it and get it delivered today, you can order future batches for that price. Price for available THs are much higher, and only a few companies have any hardware on stock. You can offer millions, but they don't have the hardware to sell to you in any significant quantities.

Keep in mind that in order to mount 51% attack you don't have to purchase 51% of the current hashrate, you have to purchase 102% of the current hashrate.

jonald_fyookball

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See above. 180 million on the upper end,
and that will only DECREASE as hashing gets cheaper.

The governments of the world spend many billions
on "unrealistic" things. like billions every year on the war
on drugs, etc.

Of course it is a realistic possibility that someone
could spend billions to attack Bitcion.

Bitcoin needs better security.

itod

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^ Will code for Bitcoins

Quote from: Brangdon on April 23, 2014, 04:20:33 PM

The kind of attack that concerns me is someone spending $100m or so on new hardware, not part of any pool, and thus gain over 51% percent.

You are playing with numbers without even bothering to check them. $100m can't buy you 51% network hashrate, not even close. As each month passes by that figure is getting closer to $1 billion. Who knows how much it would be by the end of this year, but someone investing billions in 51% attack is not a realistic scenario.

jonald_fyookball

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Quote from: cbeast on April 23, 2014, 05:07:37 PM

Quote from: Brangdon on April 23, 2014, 04:20:33 PM

The kind of attack that concerns me is someone spending $100m or so on new hardware, not part of any pool, and thus gain over 51% percent. They then private mine empty blocks until they have a chain say 3 hours long. Then they publish it. At which point, all the transactions in those blocks, some of which had 18 confirmations, suddenly have zero confirmations. They all become vulnerable to double-spend attacks by their original senders. The attacker continues mining blocks, now including any double-spends. They do this once a day, at random times, from different IP addresses, for the next six months.

(Instead of empty blocks, they can fill them with artificial transactions. They can mix in real transactions to make the bad ones harder to detect. It can probably be done for cheaper than $100m; but $100m would be cheap enough for a government or bank.)

Abandoning Bitcoin to a spin-off would be one solution. A bit extreme, though. Lots of people would still lose out because of lost transactions. People who bought coins for fiat and then didn't get their coins because that transaction happened after the spin-off took its snapshot.

Mining hashrate is still growing. I don't think you can 51% attack for less than a billion and your rewards at this point wouldn't be nearly enough to cover even a million. Anyone willing to throw away money like that would probably be discovered. Sacrificing bitcoins for pump and dump spinoffs is just a bad idea unless it is a complete overhaul of Bitcoin and the legacy system was still supported.

Where did you come up with $1 billion?

I can buy a CoinTerra TerraMiner IV which gets 2 TH/s for $5999.
Thats $3000 for 1 THs.

At that rate, I can get 60 PH/s (the entire current bitcoin network)
for 180 million. And arguably, it would be much cheaper for
a bulk order and working directly with core component manufacturers.

Even if it was a cool billion, that's not much
for a government. Heck, the freakin
state of illinois just decided to spend 100 million
on a library for Obama.

http://www.breitbart.com/Big-Government/2014/04/18/Illinois-Taxpayers-to-Give-100-Million-for-Obama-Library

cbeast

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Let's talk governance, lipstick, and pigs.

Quote from: Brangdon on April 23, 2014, 04:20:33 PM

The kind of attack that concerns me is someone spending $100m or so on new hardware, not part of any pool, and thus gain over 51% percent. They then private mine empty blocks until they have a chain say 3 hours long. Then they publish it. At which point, all the transactions in those blocks, some of which had 18 confirmations, suddenly have zero confirmations. They all become vulnerable to double-spend attacks by their original senders. The attacker continues mining blocks, now including any double-spends. They do this once a day, at random times, from different IP addresses, for the next six months.

(Instead of empty blocks, they can fill them with artificial transactions. They can mix in real transactions to make the bad ones harder to detect. It can probably be done for cheaper than $100m; but $100m would be cheap enough for a government or bank.)

Abandoning Bitcoin to a spin-off would be one solution. A bit extreme, though. Lots of people would still lose out because of lost transactions. People who bought coins for fiat and then didn't get their coins because that transaction happened after the spin-off took its snapshot.

Mining hashrate is still growing. I don't think you can 51% attack for less than a billion and your rewards at this point wouldn't be nearly enough to cover even a million. Anyone willing to throw away money like that would probably be discovered. Sacrificing bitcoins for pump and dump spinoffs is just a bad idea unless it is a complete overhaul of Bitcoin and the legacy system was still supported.

Peter R

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Quote from: jonald_fyookball on April 23, 2014, 04:17:26 PM

Cool but I'd rather make bitcoin core ideal rather than spin something off, wouldn't you?

What I want is largely irrelevant. I know that bitcoin will become what consensus turns it into.

PoW is the technique that we have chosen to establish consensus on how transactions are entered into our blockchain ledger. In a sense, each "orphaned" chain is a spin-off that quickly died because it was perceived as less legitimate than the longest chain. The "spin-off" technique is a generalization of this process.

If the economic majority favour the PoS spin-off, then it becomes the legitimate chain. In fact, I think the "masses" would still call it bitcoin. They may simply download a wallet update and never know that the network hardware and consensus mechanism were now 100% different.

Once again, I think PoW is the superior mechanism for establishing consensus. The "spin-off" technique is just a method for the blockchain ledger to assimilate new technology.

EDIT: Jonald, what is the core of bitcoin?

Topic: Annual 10% bitcoin dividends if mining were Proof-of-Stake - page 19. (Read 16688 times)