Topic: It's about time to turn off PoW mining - page 18. (Read 39732 times)

Exchanges can manipulate the price easily, they can create fiat money and cryptocurrency out of nothing in their database and maintain whatever exchange rate they want, but they don't really have any serious market depth, a large sell order can bring down the price dramatically. So it is important that major stake holders don't dump their coins, just like a typical stock

Only time will tell, but I am betting on you being wrong. This is just speculation that they will be worth nothing "in the end". Whatever "in the end" means...

I am not going away anytime soon. 

I don't get how any of this refutes what I said. How do PoS coins have value then, in some cases in the multi million dollar range? If what you say is true they would all be valueless. The answer is that coins can derive value from other dynamics. People see the most valuable PoS coins as being valuable, and are willing to pay money for them based on that perceived value.

In the case of Bitshares, people see value in DPOS, TITAN, a truly deflationary currency (bitcoin is inflating), and the decentralized exchange for market pegged assets (FIAT/commodities/cryptos). In the case of Nxt, people see value in POS and the numerous features Nxt has added. Both of these coins cost next to nothing in electricity to make/secure, yet they both have valuations of over 60 million dollars currently. If what you say is true these coins would be worth much less.. practically nothing. Innovation, community, infrastructure, merchants, security, ease of use, features, and development are what make coins valuable.. not the amount of energy used to make them.

These PoS guys are still here, huh? PoS coins have value because someone is willing to hype them like snake oil, but in the end they will only have value because someone has guns pointed at you to accept them. There is not one PoS coin that can guarantee that there isn't a central bank behind them. Not one developer has gone on record claiming Proof of Freedom from permanent centralization.

It really doesn't add any security.. hack a large Bitcoin pool and you can 51% Bitcoin. Take a gun to a large Bitcoin pool and you can 51% Bitcoin. There are ways to 51% Bitcoin for cheap that doesn't require the use of massive amounts of electricity or specialized hardware.

I guarantee you if this happens we will fork, move on, and let the attackers play with themselves on the old chain. It is not a challenging thing to do.

Again.. there are much cheaper ways to 51% Bitcoin.


If someone tries to hack 51 delegates, they run the risk of 1 delegate finding out they are hacked before being able to hack the other 50 delegates. We can then increase the delegate amount which would work similar to increasing the difficulty, so that they would have to hack double the amount they would of originally. Alternatively we can just vote out the infected delegates. If someone buys up 51% of the currency supply and attacks, then we can fork the coin, burn their stake and move on. Again if all else fails, we fork the chain if it comes under attack, and leave the attackers holding a bag of useless coins. It is not as huge a deal as you are making it out to be.

It is not about PoW or PoS, it is about the value that must pay to produce the currency

The only currency that does not need value input is fiat money, since they are forced into circulation, thus can have arbitrary value decided by the central banks. Since people must get fiat money to purchase goods/services, there is a fixed demand for fiat money

For cryptocurrency, there are no central authority to force its usage. So you can not use any modern monetary theory to analyze cryptocurrency's value. If people are willing to use this coin, the coin must give them some reason for its value, cost is one of the most simple and fundamental explanation for the value: If it cost at least that much to mine a coin, then it at least worth that much. Of course they could also look at the exchange rate, but since all the exchanges are still in wild west stage and have leverage and FRB practice, no one know if the price is manipulated by those exchanges

Of course there are many things cost a lot but have little demand, like those ghost towns in china. But even for those ghost towns, the label price of the apartment is still higher than the cost. They will never lower the price under the cost, even none of the apartment is sold, and eventually the demand will pick up and digest those apartments at a later time

This is a silly statement too. How long has BTSX been around versus Bitcoin... Give time for the infrastructure to develop before you make such claims. Again, you went from rational debate to FUDing about DPOS pretty quick..

Bitcoin is not being used for ecommerce at a large level yet. I ran a cryptocurrency business and accepted cryptocoins and Paypal. The number of people that preferred to pay with paypal and not spend their precious cryptocurrencies was massive. Out of hundreds of orders, I can count on two hands the number of people that paid with cryptocurrencies.

It is true that they could vote themselves in as delegates, but as soon as they start doing nefarious activity such as blacklisting or selectively approving transactions, they risk the community forking the coin leaving them holding worthless coins. That alone should be incentive enough for a large stakeholder to not act nefarious. If not it isn't really a big deal.. we fork, burn their stake and move on.

This is not necessarily a good thing, there are benefits for users being able to select who profits from securing the network. By voting in delegates that are improving the cryptocurrency in some way, it gives the users a way to compensate people that are doing good work in the community.

For instance, There is someone creating a multi pool that will automatically exchange mined coins for BitsharesX, which will increase buying support. We have supported this initiative by voting him in as a delegate. There is someone creating a nice block explorer and statistics website. We have supported this user by voting him in as a delegate.

One problem with Bitcoin is that it cannot select who profits off of Bitcoin mining. It is mostly for-profit ventures that are not really giving back to the community. Being able to select who profits from this activity is a good way to pay developers and other entities that are working on improving the cryptocurrency in some way.


A lot of people will only vote for delegates whom can publish and prove their identity. I don't believe this is a big problem unless there is some complicated and massive social engineering scheme at play. I can count on one hand the number of multiple delegates that are under one persons control, and again that is because they are developing something cool for the community that will improve it in some way. Maybe I am naive, but I don't see this as a big issue.


A 51% attack on both chains would be equally expensive. You could say it would be less expensive if delegates were hacked, but you could say the same about Bitcoin pools being hacked.

I see less electricity being used as a benefit to DPOS, because millions per month are not being spent to secure the network and can instead be spent developing the infrastructure or providing buy support.


I see these all as non issues, as if something extreme were to happen we can fork the coin and move on. Leave the attackers to play with themselves on the original chain, and everyone else move to a new one. It is not a huge deal.

You are bordering on FUD as to your current arguments for DPOS, because you are ignoring all benefits and only focusing on the negatives.

This is quite an overstatement. I pay employees in bitcoin, I buy goods and services regularly in bitcoin, I "wire" funds in bitcoin, I give gifts in bitcoin , I tip in bitcoin.

Yes, most transactions are still for investment for bitcoin, but for alts it is a far higher percentage than Bitcoin.
How many employees and business accept BTSX for payment, 0.001% of Bitcoins marketplace?

I suppose Dodgecoin is an exception as most movement is probably for tipping.

This is silly. The only reason why people are buying Bitcoin is to speculate too...

I agree with you that burning electricity doesn't directly create value in a token. The best one can argue is that electricity usage is one variable amongst many that support the value of bitcoin as it adds an extra layer of security that DPoS and PoS lack. I understand that you don't agree that electrical costs/equipment costs don't add any security to a coin but this is where I disagree with you.

 A controlling stake of DPoS delegates could decide to start blacklisting or faking certain transactions at no cost to themselves besides risking alienating part of the community and possibly creating a fork hurting all users which may or may not happen.

With PoW the cost is not only upsetting the community and possibly forking the coin but also the electrical costs costs which to generate one block now is over 11k. In the future when block reward is 12.5 and bitcoin is 4-8 times higher in value this cost will be 25k - 100k in electricity alone not including the equipment....So there is up-front costs in attacking even if you spend 600million to 1 billion in equipment. The ongoing costs of mining also forces miners and pools to increase security as there is tangible day to day costs and if they get hacked than they lose all of their investments.

With PoS one can slowly start purchasing coins with no one knowing and with PoW the ASIC manufacturers and engineers setting up the mining warehouse would know what you are doing. So a 51% attack with PoW is much harder to pull off in secret than with PoS or DPoS. And if word leaks out as it will we can counter it by increasing the difficulty in response so the net effect of an unsuccessful attack or yet to be completed attack is that it is merely increasing security for the network from other attackers. So if their are multiple attackers attempting a 51% attack than the arms race will remain at a stalemate.

People like to speculate with their money. Creators Scammers of altcoins are often very good at getting people to want to invest in their "new" "idea" and people do invest.

To back up this claim, just look at the level of actual commerce of these PoS coins, there is none with the exception of buying/selling the coins for bitcoin (or other altcoins). The only reason people are buying these PoS coins is to speculate

I'm tired of all the arguments that a cryptocurrency needs to burn electricity through PoW mining to achieve value.

These arguments can be instantly refuted by the fact there are multiple PoS cryptocurrencies with market caps in the multi million dollar territory.

This argument is whack..

If a cryptocurrency requires electricity to be consumed via PoW mining to achieve value, how have these PoS cryptocurrencies in the multi million dollar range regarding market caps defied all odds and achieved their values without PoW mining?

The answer is that there are more dynamics at play in how a cryptocurrency is valued in the free market... many more dynamics than simply their consensus algorithm. The dynamics are similar to that of those of how different PoW cryptocurrencies are valued on the free market... some are worthless and some are worth millions.

your grasping at straws to try and make your argument stand. Your completely disregarding supply and demand, utility and every valid argument made so far. The scenarios I mentioned could very well happen but not over night.

From end users perspective, would the end Joe soap user even know the difference between pos and pow? No they most likely wouldn't. Your applying an argument that may work for pm's, to a context that it can't possibly apply to here..

Overstock are considering listing shares on an asset exchange and it could do it on nxt, and other companies could follow suit.. And that could set in motion the scenario I mentioned. I never said anything about it being mandatory to pay taxes in nxt ether.

At the end of the day, your theory doesn't hold water. If it did then pos coins would never have any value what so ever and never would. You cannot say it doesn't apply at a low marketcap(not that 40m is low,) and say it does at a higher cap? When does your theory start to apply? Can you provide any mathematical formula to back up your theory? Would nxt just hit 200m market cap and everyone would just think  oh wait it cost nothing to produce I better sell? I'm sorry for being rude but your ether  talking out your bias ass to protect your vested interests, just repeating what all the other pow fanbois are saying or you know your wrong and are not willing to admit or you just have no clue what your talking about. All of the above make you look like an idiot.

Good day.

Ps. Your argument would stand if it was possible to continue making a coin for free, I mean minting new coins in an existing system, but the total coins are minted and no more can be minted after that, thus rendering your argument invalid.

All of these scenarios won't happen if the coin cost nothing to make. It seems that fiat money also cost nothing to make and every merchant and whole financial system is using this transaction medium, but there is a hidden cost: You must pass a law to make fiat money the legal tender, thus forcing people to use it, what is the cost to make that law? Try to pass a law to make NXT the legal tender and see how much that will cost you

From end user's perspective, why should I exchange my valuable goods/services with a coin that cost nothing to make? Am I so mad to become the slave of those coin makers? I should join them to make the coin instead  

It is an interesting discussion: If a coin has no cost to produce, but has a limited supply, can it hold some value long term wise? I think it depends on who is able to back the coin

For example, I create a zero-cost get-rich-quick-coin, hold majority of the coins by many different accounts, and set the coin generation speed to one coin per day, and I spend $500 to buy 1 coin every day on the market, so the market price will always stay above $500. Since I hold 1 million of those coins, the market capital becomes $500 million, this is perfectly doable, and overtime the coins will be spread among many new users, I could even sell many coins to those users at $500+

However, if a competitor create a get-rich-quicker-coin using a similar strategy, and make that coin's price double every week until it reaches $5000 per coin, doing lots of advertisements and campaign on Google and make lots of merchant accept that coin at mean time, people will dump my get-rich-quick-coin and chase that coin. When they dump it in large quantity, I'm not able to maintain the price of $500 anymore, then it will crash down hard and more and more people will dump it (I might be able to buy back all of them at a much lower price but now this coin is dead, the hype is over, no one will be interested in it any more)

If you really want a coin to have long term mass adoption and still keep a high value, its value should be backed by millions of miners, they will decide to sell or to hold depends on their cost. And the cost also gives other new users a guidance for its value. A single entity (especially exchanges) can indeed pump the price up very high, but it is not a guarantee that they could get their supporting money back. When support is removed, the value will eventually fall back to the cost, especially when coins are widely spread among many users

Demand wise, I have not seen any alt-coin provide fundamentally different utility than bitcoin, the real demand all goes to bitcoin because of its much larger infrastructure and community

so if every major online and street retail outlet globally suddenly accepted nxt for payment and a few counties allowed citizens to pay their taxes in nxt (or their own national currency) and a few multibillion dollar companies ipo'ed on the asset exchange it would still have a market cap lower than bitcoin simply because there was zero production cost? you must be mad..

Silver and copper also have unique qualities that other metals don't have and cannot be cloned.

Silver and copper also has a history of of being used as currency, and their value also established from the manufacturing cost. You can create a new algo and start an alt-coin, but you have to invest equal amount of chips/energy in order to bring the manufacturing cost close to what bitcoins stands today, thus bring its market capital close to bitcoin

Although gold has a fixed total supply on earth, human has only digged out a very small percentage of gold near the surface of the earth, now many deep gold mines are opening up in China, who knows what the market price will be in the coming years, anyway it can not be consumed easily

If Nxt innovates and has some adoption, then it can hold its value. How high, I don't know.