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Topic: DECENTRALIZED crypto currency (including Bitcoin) is a delusion (any solutions?) - page 34. (Read 91144 times)

member
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"Bitcoin continues because it doesn't allow multiple Partitions"

Hmm, you have a steep background in relativity, but somehow things go wrong somewhere. Bitcoin partitions all the time - that's the default for everything. Nodes only synchronize ex-post, hence the block cycle.

I'd humbly suggest to start with some through research of some basics:

* computers are electronic elements with billions of components. how does such a machine achieve consistent state? see: Shannon and von Neumann and the early days of computing (maybe even Zuse)

* partitions, blocks, DAG's, .... all this stuff generally confuses the most fundamental notions. after investigating this matter for a very long time, I can assure you that almost nobody understands this. I'll give an example: in any computer language and modern OS, you have the following piece of code:

Code:
declare variable X
set X to 10
if (X equals 10) do Z

will the code do Z? unfortunately the answer in general is no, and its very hard to know why. the answer: concurrency. a different thread might have changed X and one needs to lock X safely. in other words data or state in modern computing is based on memory locations. programs always assume that everything is completely static, when in reality it is dynamic (OS and CPU caches on many levels). These are all human abstractions. The actual physical process of a computing machine is not uniform. In fact it is amazing that one can have such things at all exist, since Heisenberg discovered its impossible to tell even the most elementary properties of a particle with certainty. Shannon found that still one can build reliable systems from many unreliable parts (the magic of computing).

With regards to your basic thesis you're right and wrong at same time. Total coordination is impossible even on the microscopic level. Bitcoin implements a new coordination mechanism, based on the Internet, previously unknown to mankind. It's certainly not perfect but that notion leads nowhere anyway. The foundations of computing is how one treats unreliable physical parts to create reliable systems (things that are imperfect add up to something which as reliable as necessary).
sr. member
Activity: 420
Merit: 262
See the quoted content for how this post applies to this Decentralization thread.

Synereo probable scam alert (note I think their intention is sincere but they unnecessarily attach a speculation model to a very high risk experiment in social modeling that n00b speculators will wet their pants for because they can't understand it but it sounds cool):

[...]

Besides the rest of the Synereo network operates on a decentralized, no-consensus model, which is the antithesis of a crypto currency which requires global consensus. Conflating Synereo with a crypto currency will thus end up forcing Synereo to be centralized (see my research in the Decentralization thread for why and also my formerly censored thoughts about why afaics the work that Synereo's Greg Meredith is doing for Ethereum's Casper consensus protocol is flawed and won't solve the inherent flaw in Ethereum w.r.t. to decentralization).

Similarly, when Synereo launches, an initial supply of
AMP s will be available for purchase and distribution to early
users and contributors. Synereo also o ers a unique social approach to proof-of-
work that will be connected to a kind of "mining" and AMP
creation. However, the discussion of this is currently out of scope for this paper.

It is impossible to invent a PoW which derives from a decentralized, no-consensus network which isn't about consuming a resource and also achieve global consensus on the distributed ledger's (block chain's) Consistency due to the CAP theorem.

This is nonsense to claim you have such a PoW.
sr. member
Activity: 420
Merit: 262
Segregated Witness is overviewed here:

https://bitcoinmagazine.com/articles/segregated-witness-part-how-a-clever-hack-could-significantly-increase-bitcoin-s-potential-1450553618

https://bitcoinmagazine.com/articles/segregated-witness-part-why-you-should-care-about-a-nitty-gritty-technical-trick-1450827675

Old nodes have no way to know if they are including a fraudulent transaction in their blocks, thus everyone will upgrade to new node else they can be attacked with fraudulent transactions which cause their block rewards to be ignored by the new nodes. Thus Segregated Witness is effectively a hard fork.

Thus this does nothing to solve the Tragedy of the Commons which is driving PoW mining towards (an oligarchy) centralization in order to scale transaction volume. It is a gimick used to increase the block chain by some factor, while sneaking in the ability for Blockstream to add new scripting versions so they can later soft fork (version) the block chain to support Sidechains. Clever but not clever enough to hide from Sherlock Holmes (me)!

Upthread I have rough sketched a design for a solution that conceptually scales and maintains decentralized, permissionless control over mining.



Apparently you don't understand that you are talking to someone who is much more astute than you and more so than most of the guys on this forum.

blah blah blah

You have a reading comprehension handicap. Try again:

while sneaking in the ability for Blockstream to add new scripting versions so they can later soft fork (version) the block chain to support Sidechains

A third advantage of Wuille's Segregated Witness proposal has Bitcoin programmers just as excited as the first two – if not more-so: script versions.

As explained in the previous article, Segregated Witnesses carry scriptSigs that unlock bitcoin. But they carry something else, too: version bytes. These version bytes preface scriptSigs in Segregated Witnesses, indicating what kind of scriptSig it is. If a node reading the version byte recognizes the type, it can tell what requirements must be met to unlock bitcoin in the scriptSig. If a node reading the version byte does not recognize the type, it interprets the scriptSig as an “Anyone can spend.”

This opens up all sorts of new ways to lock bitcoin up in transactions. In fact, it can be used to lock bitcoin up in any way developers come up with. As such, it's impossible to explain how this will be used in the future, since much of this still needs to be invented. But initial ideas include Schnorr signatures, which are much faster to verify than signatures currently in use, and more complicated types of multisig transactions; perhaps even Ethereum-like scripts.

And importantly: Like Segregated Witness itself, these types of upgrades will not break Bitcoin's existing consensus rules. Rather than every single Bitcoin node, only a majority of miners needs to adapt, making them much easier to deploy.
sr. member
Activity: 420
Merit: 262
Note the viable solution for Ethereum may be to centralize only the verification, and keep the voting power decentralized. This is essentially what I am proposing for my PoW design.

I assume you mean verification as in if the smart contract output matches the input submitted by the requesting node? Centralization of the transaction processing seems to be giving up the decentralized voting power.

Centralization is always more efficient, but complete centralization is not necessary. That is your main gripe with Ethereum, right? That each node has to run the scripts themselves?

I think proper checks and balances could be implemented to reduce the amount of nodes the code has to be ran on while maintaining decentralization.

IE. If 100% of an arbitrary number of randomly selected nodes agree on the output, then it may not be necessary for all nodes on the network to run that code as long as there is one honest node. If there is one dissenting node, then the full network (or a larger percentage of the network) runs the code to solve the dispute. ... or something similar to this.

I don't want to be condescending, so please try to take this reply constructively.

We already discussed upthread why delegating consensus decisions to a minority of the stake (PoS) or hashrate (PoW) will result in divergence and no consensus.

You are not considering the economic game theory that comes into play. When there isn't a resource consumed to force a choice of orderings amongst the plurality of potential arbitrary orderings, then there is discord.

This was covered for example in the discussion starting some where around page 28 of this thread between enet, myself, and monsterer.

I am not going to be able to help you digest this entire thread, by resummarizing the entire thread. You will have to invest the effort/time to read and digest the technical points carefully if you desire to be fully knowledgeable about this issue. What you feel might be okay, is not actually a well researched level of knowledge of this particular consensus/verification issue.

Please don't again accuse me of writing too much technobabble. It isn't my fault that the issue is complex.

You are welcome to quote a specific point upthread and rebutt it.



Again, people shouldn't keep this at arm's length.  Imagine if it really does become the 'world computer' with a billion users, and billions of smart contracts, the blockchain would be too huge.

There won't be any block chain that scales to the significant global usage where most users (and miners) run full nodes. Simply can't be done.

Centralization is required for scaling. The only solution I thought of is to control the centralized full nodes with decentralized power. Keep the mining power in the hands of the users.

Agreed. You need trust to scale. Mining = creating coins + verification. It would be better to talk about verifiers or auditors rather than miners.

Trust & verify (statistically).
sr. member
Activity: 420
Merit: 262
Pool centralization increased in Bitcoin in 2015 as I predicted back in 2013, despite arguments that said miners will switch pools to avoid centralization  Roll Eyes

When will many prominent people here in this forum ever learn economics.



sr. member
Activity: 420
Merit: 262
That will not work in my design because the payer has to do a roundtrip request to request the current "intra-block chain" hash from a "provider" to include in the PoW share (otherwise the same PoW share could be submitted to multiple providers and thus payers have no vote in the LCR). Therefor the PoW share computation can be outsourced at no extra latency cost.

Why don't you have the providers just act as the mempool? Then users can gather the TXIDs in their round trip and sign their own PoW, rather than just gather the already produced block hash.

This wouldn't remove the economic incentive to outsource the PoW share computation to an ASIC.

Also note the payer is only computing a PoW share, so they won't be announcing a block solution most of the time, so that extra communication load is on every transaction submitted to the network.

Also you are missing a key point (that I have not yet revealed) about how I do the intra-block partitions so as to enable instant transactions.
sr. member
Activity: 420
Merit: 262

Afair (and I don't have time to re-read it given all I have learned since I first read it) that paper did not articulate the most unarguable and salient reasons that PoS is inferior. I think we furthered the understanding in my linked thread. Also I wrote something about this in one of Vitalik's threads:

https://www.reddit.com/r/ethtrader/comments/42rvm3/truth_about_ethereum_is_being_banned_at/czcpoez

On any sufficient time horizon, it has to be a bubble that will crash to near 0 unless they solve the fundamental flaw of how to handle decentralization of a block chain given the Tragedy of the Commons which forces centralization due to asymmetry in block rewards per verification cost, or unless the verification cost is insignificant which isn't to be the case for arbitrarily long running scripts. And I assert this flaw can not be fixed. I have studied this and it is fundamental due to the CAP theorem that they can't use partitioning (shards) nor consensus-by-betting nor any of the other ideas proposed for Casper.

This would be true for any block chain that supports long-running programmable scripting with verification cost that is unbounded (and not assuredly insignificant). The Tragedy of the Commons even applies to Bitcoin and any PoW coin to a lesser extent because verification cost is much less.

I am not just interjecting technical fundamentals, I am also asserting speculative insight that a block chain which can't scale decentralized is not an innovation for anything (well an exception could be a centralized Zcash is still useful for provable anonymity). This doesn't speak about the short-term pump which is more of speculator sentiment and liquidity issue. I am speaking about "On any sufficient time horizon".

Note the viable solution for Ethereum may be to centralize only the verification, and keep the voting power decentralized. This is essentially what I am proposing for my PoW design.
hero member
Activity: 966
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legendary
Activity: 2142
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Newbie
edit: why are you replying to this thread as a different user?

He is not Phoenix, after a ban he has to take another name.
legendary
Activity: 1008
Merit: 1007
That will not work in my design because the payer has to do a roundtrip request to request the current "intra-block chain" hash from a "provider" to include in the PoW share (otherwise the same PoW share could be submitted to multiple providers and thus payers have no vote in the LCR). Therefor the PoW share computation can be outsourced at no extra latency cost.

Why don't you have the providers just act as the mempool? Then users can gather the TXIDs in their round trip and sign their own PoW, rather than just gather the already produced block hash.

edit: why are you replying to this thread as a different user?
sr. member
Activity: 420
Merit: 262
sr. member
Activity: 420
Merit: 262
TPTB, from what I understand your design is supposed to eliminate mining profitability by requiring users to send PoW with each transaction. Are you (not) trying to tell us that you plan to decouple transaction processing from currency distribution (i.e. no block rewards)?

There could still be a block reward for as long as it is unprofitable for professional mining farm due to the difficulty created by all those submitting PoW and not expecting a profit.

Note however that microtransactions may not be a viable model, so that throws a monkey wrench into my design plans (because need for users to be mining often in order for them to drive difficulty very high), but I have another idea to investigate now as a possible work around.
hero member
Activity: 795
Merit: 514
TPTB, from what I understand your design is supposed to eliminate mining profitability by requiring users to send PoW with each transaction. Are you (not) trying to tell us that you plan to decouple transaction processing from currency distribution (i.e. no block rewards)?
sr. member
Activity: 420
Merit: 262
You state that the CAP theorem is fundamental to all of what you are describing.  The CAP theorem is essentially this:

a statement that it is impossible for a distributed computer system to simultaneously provide all three of the following guarantees:

    Consistency (all nodes see the same data at the same time)
    Availability (a guarantee that every request receives a response about whether it succeeded or failed)
    Partition tolerance (the system continues to operate despite arbitrary partitioning due to network failures)

Let's start with an assumption that I agree with the CAP theorem, and further assume that this notion is actually correct.

In that case, let's say all nodes don't see the same data at the same time.  Seems reasonable, after all, how could they?

The problem manifests as an inability to reach consensus on which of the conflicting Partitions has the accepted and rejected double-spend. You might start reading roughly page 27 of this thread to see the discussion between enet, monsterer, and myself, wherein I elucidated this.

Availability - for the sake of argument, let's say every request receives a response about whether it succeeded or failed, or if it doesn't the first time, it is programmed to repeat the same request until it receives a reply, which it will receive within a reasonable period of time.

Inaccessibility manifests as a protocol requirement to prevent interoption between Partitions to solve the Inconsistency mentioned above.

Partition tolerance - Let's say for the sake of argument the system continues to operate despite arbitrary partitioning. One example perhaps being a network failure leading to event like the 2013 Bitcoin fork - analyzed here by Arvind Narayanan, who interestingly poses arguments in favor of a certain degree of centralization within bitcoin development: https://freedom-to-tinker.com/blog/randomwalker/analyzing-the-2013-bitcoin-fork-centralized-decision-making-saved-the-day/

Indeed centralization of policy (thus abandoning decentralized, permissionless commerce) is the only way to deal with the Inconsistency or Unavailability (choose one) when multiple Partitions are allowed.

I have argued upthread that centralization will be the only way Iota (with its multiple Partitions) will avoid divergent, chaotic Inconsistency (since obviously it doesn't limit Accessibility).

So under these conditions as described above, which I suggest are roughly representative of the actual condition of bitcoin (as an example) at most times, then it would seem to me that despite the presence of the CAP theorem, the system continues.  Why?  Because the system is dynamic, not static.

Bitcoin continues because it doesn't allow multiple Partitions and because in the case where chaos would result from a fork, then centralization of the mining is able to coordinate to set policy. But we also see the negative side of centralization when recently the Chinese miners who control roughly 67% of Bitcoin's network hashrate were able to veto any block size increase. And lie about their justification, since an analysis by smooth and I (mostly me) concluded that their excuse about slow connection across China's firewall is not a valid technical justification. Large blocks can be handled with their slow connection by putting a pool outside of China to communicate block hashes to the mining hardware in China.

Possibly for systems that are very fragile or inflexible then I think that changes in these C-A-P conditions could cause them problems, of varying degrees of seriousness.  But even for highly centralized systems (e.g. corporation-states), which are highly resistant to change, they are curiously persistent.  This may be because of people's desire to perpetuate an institutional memory and cultural history of organizational (and national or tribal) ideology.  Belonging to a large group - identity which conveys a larger sense of belonging - has been, for good or for ill, branded into the human psyche.  War, government failures, economic disasters, mass murder - nothing seems to stop the bulk of people in society from falling into the trap of the state, again and again.  But I digress.  What about those decentralized systems?  Does the issue of the CAP theorem necessarily mean that they can't work?

Not necessarily.  If a system is dynamic enough, and is managed well by its community (however that needs to happen with a distributed system in order for some degree of balance to be attained between a "centralized" development structure and a "decentralized" system, as no system is ever 100% "decentralized," then a well-cared for decentralized, distributed system can be continuously propagated (or re-propagated, much like a plant's seeds are used to regrow the fields).  

This noise is what happens when smart people haven't studied an issue in depth and start going off on conceptual abstractions in their mind without really understanding what they are conceptualizing. I hope my explanations above have caused you to realize you are incorrect.

Interesting discussion though!

Thanks. Hopefully you will read it all.
sr. member
Activity: 420
Merit: 262
You should include a discussion of the halving, to be fair.  It is coming up in a few months... I think.

Already mentioned upthread:

Quote
The professional miners' are aligned to paying back the loans they incurred to buy mining farms. Frankly I think your post is delusional. Get a grip on economics. Usury (debt) enables the banksters to take entire control of the economics of mining and charge the costs to the collective.

I think the current manifestation of professional mining will evolve as bitcoin shifts to lower block rewards. We really have no idea what the next halving will bring, nor the next one. I wouldn't be surprised if a majority of net hash gradually shifts back to the enthusiasts from the mining centers. The big corporate mining farms will shut down, the manufactures running these farms will liquidate their hardware, the hardware will flood the market and be distributed extensively.

Back to Economics 101. The marginal producers are the first to go. The block halving will hand a greater percentage of the hash rate to the hydropower mining farms (and Larry Summers' 21 Inc) whose costs are probably below $50 per BTC. Bitcoin is designed to slowly transition to corporate control. Even Satoshi admitted that.

And those who think riding that trend is in their benefit, my thinking is they don't really have good foresight of where this shit is going to end up real bad for humanity real fast. We are talking about years, not decades.

And most BTC investors will end up losing, not gaining. The banksters are cleverly mining all of us via their funding of the mining farms. We are just stupid cows.
sr. member
Activity: 420
Merit: 262
For anyone else who hasn't put their fingers in their ears, it should be obvious that there does exist an equilibrium in bitcoin mining, centered around the 25 BTC cost per block, because if there weren't one of two things would happen:

1. Cost of production exceeds 25 BTC, all miners go out of business since their costs exceed their profits
2. Cost of production is less than 25 BTC, the block interval shrinks to 0, and bitcoin inflates wildly out of control

You might argue that difficulty adjusts to compensate, but that can only happen if there can be an equilibrium.  TPTB_need_war is confusing the fact that some miners are more profitable than others with the fact the overall the network is break even, since some miners are unprofitable.

So the miner attacking the coin is going to have the capital cost which coincides with the equilibrium average.  Roll Eyes

As I wrote to you last time, there is no equilibrium (capital cost) in our consideration of the equation of the profitability of an attack and the incentives thereof.

Sigh.

I get frustrated because this post of yours ignores what I wrote in the prior post.

There is no such equilibrium because not all miners have the same costs for the same difficulty.

Don't feel bad, as it is a mistake so called "economists" make routinely, trying to model some phenomenon with statistics and totally failing to understand that the mean doesn't actually exist and instead the distribution is composed of diverse samples.
sr. member
Activity: 420
Merit: 262
[...]

Afaik, the insoluble fundamental problems of decentralized exchanges that operate directly on the block chains of the coins being exchanged are:

  • Block chains don't have fast enough transactions and can't handle the trading volume.
  • The exchange protocol requires long delays (partially because of the third issue below), which means the paradigm can be DDoS attacked[jammed], thus rendering it unsuitable (since exchange is normally a very time sensitive action).
  • Orphaned blocks can lead to one of the parties losing all the coins.

And yes afaik malleability makes decentralized exchange impossible. But even after fixing that, the block chains of all the altcoins need to have special changes made to their protocol (hard forks) and still you will have the insoluble problems I bullet-pointed above.

[...]

As for the block chain scaling issue of the first bullet-pointed above, that is what I am working on now with my proposed design which was discussed upthread.

As for Bitshares[...]

So after further thought, item #1 I am aiming to solve with my block chain technology and others may be working on similar block chain tech.

Item #2 is partially a function of the block chain technology in terms of delays that can be reduced, but the more salient issue is that the protocol can be jammed (not DDoS attacked) by a party that backs out and doesn't complete TierNolan's protocol. But the solution to this jamming problem is to allow participants to set how many Coin Days Destroyed the counter party must possess on the UTXO being offered in the trade. Has anyone else ever suggested this solution?

Item #3 is also a function of block chain tech and how likely an attack on the probabilistic model of confirmations is.

So I am saying that these issues appear to all be solvable, at least excluding the real-time trader scenario.

In regards to decentralised exchanging using ACCT the introduction of CLTV means that malleability is no longer an issue (you don't need to refer to transaction ids that aren't already confirmed).

I have built code that will create a Bitcoin script that works by combining the ACCT and CLTV with a P2SH address and redeem script.

https://bitcointalksearch.org/topic/m.13435766

What about the other issues with decentralized exchange I enumerated?

It is only a solution to the malleability issue that rendered TierNolan's original implementation practically unusable (so I just wanted to clarify that malleability is no longer a part of the problem).

I see ACCT with CLTV as being more akin to a street currency exchange than to an exchange like Cryptsy (i.e. useful in the same way as a street currency exchange is for fiat when you are traveling abroad but not very suitable for the purposes of day-trading and cannot be used for high frequency trading of course).

If the purpose of say obtaining LTC for BTC was not to day trade but just to have some LTC as some sort of hedge or to use for some other purpose then you won't need to trust an exchange like Cryptsy being the point.

I will want to pull up TierNolan's BIP and get a full explanation from you as to what you have accomplished. I assume we can do this in PM.
legendary
Activity: 2044
Merit: 1005
holistic

Every time you write "holistic" I recall https://www.youtube.com/watch?v=RtXF2j5JAds. Is there a synonym which could be used sometimes instead of "holistic"?

LOL!  Same here.

Don't worry, it's just a word for how TPTB has to "load it into his head"

Reference:

I am trying to load your model in my head, but you are not providing sufficient information.

I still have a 1" hole in the top of my skull where I was hit with a hammer by a neighbor when  I used to live in the squalor area (when my ex-wife made a fight about a hammock

ahahhah +1
sr. member
Activity: 278
Merit: 252
ABISprotocol on Gist
For anyone else who hasn't put their fingers in their ears, it should be obvious that there does exist an equilibrium in bitcoin mining, centered around the 25 BTC cost per block, because if there weren't one of two things would happen:

1. Cost of production exceeds 25 BTC, all miners go out of business since their costs exceed their profits
2. Cost of production is less than 25 BTC, the block interval shrinks to 0, and bitcoin inflates wildly out of control

You might argue that difficulty adjusts to compensate, but that can only happen if there can be an equilibrium.  TPTB_need_war is confusing the fact that some miners are more profitable than others with the fact the overall the network is break even, since some miners are unprofitable.

You should include a discussion of the halving, to be fair.  It is coming up in a few months... I think.
legendary
Activity: 1008
Merit: 1007
For anyone else who hasn't put their fingers in their ears, it should be obvious that there does exist an equilibrium in bitcoin mining, centered around the 25 BTC cost per block, because if there weren't one of two things would happen:

1. Cost of production exceeds 25 BTC, all miners go out of business since their costs exceed their profits
2. Cost of production is less than 25 BTC, the block interval shrinks to 0, and bitcoin inflates wildly out of control

You might argue that difficulty adjusts to compensate, but that can only happen if there can be an equilibrium.  TPTB_need_war is confusing the fact that some miners are more profitable than others with the fact the overall the network is break even, since some miners are unprofitable.
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