Topic: If bitcoin mining will be based on POW+POS.. (Read 422 times)

OP, you wasted 15 minutes writing a pointless topic. I believe you thought you did the research to arrive to the correct conclusion. But you didn't.

Do more research, and good luck on your journey.

there is no difference, GPU mining is the last step BEFORE it turns into ASIC mining. Bitmain has already released (if i am not mistaken) ETH ASIC machines.
the only difference (if we can call it that) is that GPUs are easier to come by and can be used for other stuff (like gaming!) compared to ASICs so when a PoW coin is still in its GPU mining stage, there are more average Joes mining it than when it switches to ASIC. which is what i meant by my Bitmain remark, here there is no entity to demonize, (you have to demonize big corporations like Gigabyte, MSI,... for that to work )

And the fact that Bitmain is struggling and facing potentially bankruptcy shows how Bitcoin's incentive system works, so when miners become too big for their own good and attempt to hardfork they end up holding massive forkcoin bags. Jihan Wu has already left the building, I think Bitmain will not be around during the next decade somewhere in mid 2020's I would say, unless they change their business plan and stop threatening with forks it's just going to end up bad for them.

With PoS, vitalik's friends that got all of his coins from the ICO just have to sit on the coins and keep staking. You can google many articles about the problems of PoS security.

GPU mining, im not sure what it does solve compared to ASICs. Sure you are using GPU cards which are common devices everyone has, but so what? you still need farms of GPUs to compete, otherwise you are at a loss.

Yes, obviously there could be phases where the market is still bullish, so a little dip gets bought up (like the mini-crashes in the Bitcoin bullrun of 2016-17).

The problem is that there will be phases where the sentiment changes to negative, even without a clear "reason". For example, in 2019 we have a growing LN and many advances, but the price still doesn't want to recover. The only reason sentiment is negative is because the price went down! These are the phases which go normally a lot deeper in PoS coins because there are so many people that have hoarded their coins to get PoS rewards and want to take profits - and if the bear market becomes longer than expected, like with Bitcoin in 2018, then many of them will sell even if they declare to be "long term bulls".

Generally speaking (from my observations) volatility is higher (and thus, crashes are also deeper) if there is more speculative capital invested (that means: capital that is meant to be sold for a profit in the future) and less currency usage. PoS itself encourages speculation more than PoW because it offers an "internal" profit mechanism via PoS rewards. So there is more effort needed to encourage currency usage/economic interchange/trade, which lower volatility.

However, if Bitcoin was already used massively as a payment means, then a change to PoS would have, probably, little to no effect to volatility. But I consider a change to PoS currently extremely unlikely - also because mining with solar/wind power provide a way to secure the blockchain in an environmentally-friendly way.

let's not forget that we in bitcoin have bitmain which has turned into the evil entity more than they really are which is part of the reason why people are (foolishly) hating miners. they don't have such thing in Ethereum which is additionally because ether miners are GPU miners not ASIC farms.
i honestly don't know what kind of crap they are pulling with this slow multi step fork thing but unless they have a way of killing the PoW mining, it will exist. obviously its price will fall dramatically but not because "people" dump it, not at all. it will be because the ethereum foundation will use their premine coins to dump the PoW coin just like they did with ETC. (just search about times poloniex caught them red handed manipulating ETC price when the fork initially happened and closed some of their accounts).

i really think it's more nuanced than that. exchanges might have some influence, but on a fundamental level we all know the community will follow vitalik and the core developers, not miners. very few people will give a shit about miners---certainly not ETH investors who have been sold on the POS roadmap since years ago.

it'll be another situation like ethereum classic---the first "hard fork dividend". there will be some hype around a "civil war" just like the classic split or the bcash split in bitcoin, but that's all just meaningless drama. after it dies down, it'll just be like ETH and ETC are today. nobody takes ETC seriously. it ended up being a cash grab based on hype more than anything.


i still don't get it. why is POS different in this respect? why could fees (in a deflationary scenario) sustain POW but not POS?

Well it doesn't matter if the PoW/PoS fork survived, or the strictly PoW fork (so I see 3 Ethereums after that...)  because the striclty PoS fork which would be the one that Vitalik supports, would be the one that keeps getting listed as "Ethereum" in exchanges, because that's basically what Vitalik says it is.

The PoS problem is that people make money sitting on their money. That is not gold works, that is how fiat works, so PoS can never be a store of value. The year 2140 problem for Bitcoin is theoretical, but with PoS you already know you need the inflation from scratch.

sure but wasn't the difficulty bomb also supposed to force a transition to POS a couple years ago? history shows that it's easy to keep kicking the can down the road. it's the ethereum way!


why do you say that? how is this problem fundamentally different for POW? i think some people are rightly worried about how sustainable bitcoin's deflation model is too. we'll never know until we see how it performs a few decades out from now.


in its current forms, POS absolutely can't replace POW. it doesn't even work on a theoretical level. no one has solved it yet.

but maybe someone will, someday......

But isn't the ETH POW/POS hybrid thing just a transition phase until they enable a final difficulty bomb that kills the PoW chain? (thus forcing a fork  before the event for those that want to keep things within the PoW realm)

In general I just think PoS is repeating once again the banking monopoly problem. It incentivizes sitting on your ass and collecting unlimited interest because as far as im concerned true POS is impossible without a perpetual level of inflation.

I don't see it ever replacing PoW. PoS has some positives, like it doesn't force a constant sell off to pay electricity bills, but has negatives, like nothing-at-stake problem.

Both POS and POW are  good but I feel if satoshi had chosen the part of POS, transaction would have been more faster and efficient than it is now, though I understand your claim that POS might force the value of bitcoin to 1 million usd this time making it difficult for common people to afford and also use for payment system but have you ever wondered how they will also cope when the price eventually hit the target of 1m usd even with the POW system put in place, people will still adjust and learn to operate on satoshi rather than full bitcoin, don’t forget we also have a part of BTC that is satoshi that will be adopted then.

Your analysis is quite right and I see lots of sense in what you have written but I want to pick on the third paragraph where you mentioned that “profit taking will cause price drop here and there which will in turn create panic sell” but to me, I believe it will not be that obvious, yes I understand that already existing investors when profit goes high tends to take profit.

But, don’t forget the fact that when the prices drops, more new investors will also tend to buy more too at the deep including the already existing ones who will still pump whatever profit they get into same market back, isn’t that what the big whales are playing and yet, the market has not crashed to zero and still doing well.

actually ETH dev is quite wise, he clearly knows that nobody is going for this bullshit fork to PoS and he is completely sure that everyone will reject it. so he has come up with a workaround to force the fork on them. right now they are slowly injecting different forks on the network slowly pushing towards that target to force them to have no other option but to accept PoS!!!
if you remember they started with a "difficulty bomb" which they had to remove and all their plans went down the toilet with it so now they have come up with a new plan

it actually reminds on the frog that is being boiled alive in a pot while you increase the temprature slowly so he doesn't realize it

it's a ways off. i don't think the security of casper has even been figured out yet on a theoretical level. ethereum will just be implementing a hybrid POS/POW system in the next year or so, which isn't nearly as risky as full POS.


i'm sure there will be a chain split but i also expect it to end like the ethereum classic split. the vast majority of users and developers will likely follow the core developers, not the miners.

This issue has been discussed to death already.

In my opinion POS will make any coin more centralized that POW. POW has its faults however. One of the faults for POW is the fact that Satoshi stated "One CPU One Vote" however since the invention of ASICs it quickly invalided that. POS on the other hand issue is that it can become more centralized because it will be like most of the rich in the world, where 1% control 99% of the wealth and this is what POS might lead to.

Did Ethereum finally do that big switch to PoS? I reckon it was really close. From what I've googled it isn't still active?

https://www.newsbtc.com/2019/03/08/crypto-research-claims-ethereum-pos-unsustainable-vitalik-hits-back/

I would be surprised if the fork happened in a clean fashion. I don't believe for a second that we wouldn't end up with ETH-PoW were miners keep mining, and ETH-PoS were Vitalik followers go.

In any case when ETH goes PoS we will finally see a project of relevant magnitude operating under PoS. I wouldn't like to be holding ETH by then. I seriously doubt it's safe when there's enough money in the table for the brightest hackers on earth to try to exploit it.

All the contrary. All PoS coins I know are very volatile. And in my opinion there is a reason for it, so the same effect would also appear if Bitcoin changed to PoS or PoW+PoS. I'll try to explain it:

You (and other posters in this thread) did already find out that PoS encourages people to "lock" their coins. This means that there are significantly less "free" coins available that theoretically could flood the market. That means that in a bullish scenario, price could go up faster.

However, that doesn't mean that prices will always go up. All coins see supply and demand fluctuations. For example, profit taking will cause drops in price every now and then, and this could cause panics.

Now the problem is: a panic could be stronger in a PoS coin (compared to PoW coins) as there are more hodlers that "locked" their coins to get PoS rewards. In a scenario where the price has fallen a bit, more of these hodlers could be incentived to sell - to take profits or to cut losses. In such a crash the price could fall much faster than it does in a PoW coin where hoarding isn't so much of a problem and many coins change hands faster (e.g. because of short-term trading).

I have called this problem in the past "hoard and sell" (it could also be called "hodl and sell" ). It is and was a problem in all major PoS coins. There may be ways to solve it partially (e.g. security deposits that are locked for a pre-defined time, e.g. some weeks or even months, so people cannot sell them in a panic), but these solutions may bring other problems.

A PoS Bitcoin would only completely be "freed" of this "PoS volatility trap" if it finds a real usage as a currency. In this case, the number of hoarded coins would sink, and thus the hoard-and-sell problem would have a much smaller effect.

That only applies to unscrupulous developers who are willing to trade off security for personal profits. Plenty of projects have implemented POS (especially hybrid POS). It invariably increases demand and decreases circulating supply when you have people accumulating coins to run masternodes.


Isn't that just because the altcoin bubble happened in early 2017 and the Bitcoin bubble happened in late 2017?

Of course everything crashes when the bubble pops. Of course altcoins crash harder than Bitcoin. This has nothing to do with POS.

you are fighting a losing battle when you try to replace something that is working fine and is very secure and decentralized ,.... with something else that is not tested, is more centralized and is inferior technology to POW.

as for the price, you are ignoring all the damage that your supposed change is going to inflict on bitcoin. basically you are burning bitcoin to the ground so that MAYBE price rises after it. so first you will drop it down to $0.01 and possibly even kill bitcoin so that maybe it goes up to $0.02

You dont. POS is like fiat money, but in a digital format. The DAO would be able to print it at any time, causing inflation.

Removing POW from bitcoin would have the same effect as when silver and gold were removed from the fiat system.

With your statement, it seems that you only care about the price of Bitcoin and you don't care about the ecosystem. POW gives a more decentralized feature to the bitcoin's chain rather than POS which is a more centralized consensus as only the "rich" will be able to proceed with the validation of blocks.

Your argument that ASIC based mining is not feasible to everyone is true and valid, but the same thing happens in a Proof-of-Stake consensus as the people who don't own a big stake, they can't perform mining activities.