For various reasons, I've been more familiar with Mr. Hearn's position for longer than most of the people reading this. It is for this reason (and due to my nature) that I was one of the first people to call him out on this forum back when he was widely considered to be some sort of a hero to crypto-currencies.
It is also for this reason that since not long after my initial interest in Bitcoin I've been somewhat fixated on how to deal with TPTB interference. The idea of mollifying the mainstream corp/gov power structures was never something I saw as 'sustainable' and the strategy would fail immediately if/when Bitcoin is actually needed by humanity. My focus has been on how to harden crypto against even the most severe of attacks (and we've seen not a glimpse of what types of attacks are possible yet.)
I just gave an outline in another thread which condenses some of my ideas on this for anyone interested:
If there were an update to the POW algo, existing miners would suddenly and abruptly have not jack shit to say about the course of Bitcoin.
Things which are rewarded economically are HIGHLY successful. More than I and more than probably Satoshi would have guessed. Unfortunately the only thing which was economically rewarded (in the core system at initial release) was sha256 hashing. ASIC came at least a year before my own best case estimates. Now we have absurdities like you pointed out where every transaction costs > 1 daily household energy cost and no clear way out of the maze.
[You might say that the ratio can be improved by somehow getting Bitcoin to be used for every coffee purchase to which I would point out that transactions have been basically free (to end users) for half a decade and Bitcoin has not gotten traction in this role. I would further say that it is because Bitcoin sucks in this role, and making it get somewhere to par with dedicated exchange currencies would be a bigger re-design than some of the adjustments I suggest.]
Let me explain my 'matrix' and 'path' valuations. Say there are 10 verifying transfer nodes (a-j). Say that prior to being mined, a transaction needs to be verified three times before being mined. Say you want to monetarily reward good distribution. What you do is statistically prefer the least noted verification paths:
Here's an example of three different paths:
a->b->c-> mine
f->a->j-> mine
d->e->j-> mine
If a particular verification path (e.g., f->a->j-> mine) is continually repeated for many transactions, that path loses weighting. A miner will likely see the same transaction come in through various paths and can choose the one to insert into the block they are mining.
In my vision of things, a fair fraction of the block reward is distributed to each node who participated in transferring the transactions to the eventual miners thereby producing an economic incentive both to transfer transactions, and to be 'weird' (e.g., not one of 10,000 nodes operating within Amazon's cloud which offers no real value to the network.)
The more complex the system, the more easy it is to game. The real challenge is to try to make sure that the nodes are legitimately operated by independent players ('Joe Enduser' as much as possible) and are not cheating. We also want to do this while preserving anonymity as much as possible. A cheap USB device which only becomes unique in the enduser's hands can achieve this. If the nodes in the transfer network matrix are randomly making connections to one another and are cross-checking one another (see Kaminski's 'nooter') and comparing notes, liars and cheats can be identified and ejected.
This sounds complicated, but functionally it is actually not a very big shift from what we have in today's Bitcoin. Most users would not even notice a difference.
Most semi-technical people can appreciated the overhead that keeping such a distribution network matrix healthy would add. If it becomes necessary to operate Bitcoin under steganographic methods, the overhead of that would dwarf the functional overhead which is why the current 1MB block size is not something I want to see vanish. Should the internet tighten up with global network filtering and regulations on distributed crypto-currencies, the choices would be basically one of three:
- Forget about distributed crypto-currencies like Bitcoin as a footnote in history.
- Comply with any regulations mandated to use them.
- Adapt crypto-currencies to slip through the cracks and provide economic incentives strong enough to incent people to try.
