If the question is about valuation (the value of Bitcoin, as in its price, real or 'fair'), then I don't think there's a direct impact. Maybe we'll get to see for ourselves if Ethereum ever makes good on its promise to switch from one to another. Proof of work is more trustworthy and less centralized, so it would be fair for Bitcoin (or Ethereum, for that matter) to cost more when it's PoW than in an even of switching to PoS. However, if we're talking about actual pricing, I think there won't be any direct impact from the switch, but there can be impact based on the media coverage and sentiments. If some companies bring in new investments because of thinking that a crypto is now environmentally friendly, it can be of short-term help to increase the price. If panic that PoS isn't trustworthy is overpowering, the price can temporarily decrease.
Topic: POS VS POW effect on valuation of bitcoin - page 3. (Read 545 times)
Proof-of-Stake is fundamentally flawed, that simple. It might work for a pump-and-dump shitcoin, but there's no way the downsides won't appear for a large-scale project such as bitcoin. There's this thing Bitcoiners call "consensus" that cannot be produced with Proof-of-Stake.
"Don't trust, verify" conflicts with Proof-of-Stake, because the mechanism brings subjectivity to the game. Only with Proof-of-Work you gain complete objectivity, because it can't go more neutral than that; you can actually verify the work. The Byzantine generals need this objectivity, otherwise their concerted strategy will overtime begin appearing problems.
I suggest reading: https://bitcointalksearch.org/topic/megathread-the-long-known-pow-vs-pos-debate-5387588
"Don't trust, verify" conflicts with Proof-of-Stake, because the mechanism brings subjectivity to the game. Only with Proof-of-Work you gain complete objectivity, because it can't go more neutral than that; you can actually verify the work. The Byzantine generals need this objectivity, otherwise their concerted strategy will overtime begin appearing problems.
I suggest reading: https://bitcointalksearch.org/topic/megathread-the-long-known-pow-vs-pos-debate-5387588
I don't think bitcoin moving to PoS has ever been a reasonable option for it.
It'll bring so much in centralisation and in destabilising and desecuring the current chain. In most pos systems, there are only a few main staking pools that handle requests - those then take a fee too (increasing their own value at the cost of the chain's users and incentivising the main controllers of a chain to try to keep that control).
Some pos coins under similar circumstances (eg the ones that get to vote on which node can verify blocks) are also problematic for when that node breaks down, fails or gets hacked (and I think the second has definitely happened in a few PoS chains before just going offline).
It'll bring so much in centralisation and in destabilising and desecuring the current chain. In most pos systems, there are only a few main staking pools that handle requests - those then take a fee too (increasing their own value at the cost of the chain's users and incentivising the main controllers of a chain to try to keep that control).
Some pos coins under similar circumstances (eg the ones that get to vote on which node can verify blocks) are also problematic for when that node breaks down, fails or gets hacked (and I think the second has definitely happened in a few PoS chains before just going offline).
How does the shift from proof of work to proof of stake consensus will affect bitcoin?
The effect would be from being decentralized to heavily centralized because it would be easier for the richer people to amass Bitcoin thru staking
Will this havr any real effect on future valuation of bitcoin?
It will definitely have an effect on the future valuation of Bitcoin. Imagine having the raw materials being produced at 99% cheaper. It will definitely affect how seller prices their order since they would compete on who sells the cheapest in order for their supply to be sold asap. Bitcoin valuation that heavily relies on POW will also suffer the same thing.
I worry that POS might be the only feasible option for Bitcoin once all the Bitcoin are mined or until mining costs no longer justify rewards (if that is possible)
...
Although I do dislike the anti-democratic part of POS. Basically it could turn out to be centralization with extra steps.
That is a reasonable option, but such a situation which doesn't align with the current protocol of the Bitcoin network will just make it another altcoin and not worth what the possible value could be then....
Although I do dislike the anti-democratic part of POS. Basically it could turn out to be centralization with extra steps.
There are many uncertainties about how Bitcoin operation would function over the next century as the mining rewards gradually halves to zero and I cannot predict what changes would occur; But I would definitely not want to hold some coin built on PoS model, especially when I opted into PoW in the first place.
How does the shift from proof of work to proof of stake consensus will affect bitcoin?
Proof of work is a proven consensus mechanism, while proof of stake based blockchains are yet to be validated. How will success of proof of stake based blockchains will effect bitcoin
Will this havr any real effect on future valuation of bitcoin?
Proof of work is a proven consensus mechanism, while proof of stake based blockchains are yet to be validated. How will success of proof of stake based blockchains will effect bitcoin
Will this havr any real effect on future valuation of bitcoin?
It will set crypto space into confusion, and will likely Make Bitcoin price to be dependent on altcoins that first invented the PoS scam
The (purely hypothetical) value of Bitcoin = Zero in some bizzarro-world where such a thing could conceivably happen.
Proof of Stake is fundamentally at odds with the function Bitcoin was designed to achieve. Which is why it's never going to occur. Ever. It's one of those lines in the sand which too many network participants would refuse to cross. As such, any attempt to transition Bitcoin to POS is a topic for Altcoin Discussion, because that's where you discuss shit that isn't Bitcoin.
Proof of Stake is fundamentally at odds with the function Bitcoin was designed to achieve. Which is why it's never going to occur. Ever. It's one of those lines in the sand which too many network participants would refuse to cross. As such, any attempt to transition Bitcoin to POS is a topic for Altcoin Discussion, because that's where you discuss shit that isn't Bitcoin.
I do not want to be a spoilsport but here I go:
I worry that POS might be the only feasible option for Bitcoin once all the Bitcoin are mined or until mining costs no longer justify rewards (if that is possible). Once mining rewards fall out of the equation, the value of Bitcoin transaction rewards will likely determine whether or not using POW is worth it, in the long term.
And if POS does not crash and burn horribly in its test phase with the current POS altcoins, then it might actually be an improvement for Bitcoin, especially when it comes to scaling.
Although I do dislike the anti-democratic part of POS. Basically it could turn out to be centralization with extra steps.
I worry that POS might be the only feasible option for Bitcoin once all the Bitcoin are mined or until mining costs no longer justify rewards (if that is possible). Once mining rewards fall out of the equation, the value of Bitcoin transaction rewards will likely determine whether or not using POW is worth it, in the long term.
And if POS does not crash and burn horribly in its test phase with the current POS altcoins, then it might actually be an improvement for Bitcoin, especially when it comes to scaling.
Although I do dislike the anti-democratic part of POS. Basically it could turn out to be centralization with extra steps.
its simple
a shift from the cost of 1.5million miners hardware and electric cost to mine a block for only 6.25coin
(hundreds of thousands of $ per block: dozens of thousands of $ per coin)
to a few dollars to sign a block..
result: massive cost reduction to make a block means those making blocks sell the cheaper, way cheaper and still profit. = value crash = price crash
..
lets use ethereum.. great example
currently over $1k hash cost to mine a eth
currently ~400k potential block signers of eth PoS
ethereum releases 2eth per block and does about 6k blocks a day. meaning each potential signer might get a chance once every 2-3 months
at a PC rating of 100w (2.4kwh a day) = $180kwh in ~75 days. means
at $0.04/kwh thats a $7.20 cost for waiting 2-3 months to get 2ethereum on PoS or $3.60 per eth
yep
when they say that eth2(pos) is 99.9X% less energy intensive than PoW.. what they are hinting at is the cost of creation is X000x less costly. so expect a X000x factor decrease in value and thus an effect of a X000x factor of price speculation crash too
a shift from the cost of 1.5million miners hardware and electric cost to mine a block for only 6.25coin
(hundreds of thousands of $ per block: dozens of thousands of $ per coin)
to a few dollars to sign a block..
result: massive cost reduction to make a block means those making blocks sell the cheaper, way cheaper and still profit. = value crash = price crash
..
lets use ethereum.. great example
currently over $1k hash cost to mine a eth
currently ~400k potential block signers of eth PoS
ethereum releases 2eth per block and does about 6k blocks a day. meaning each potential signer might get a chance once every 2-3 months
at a PC rating of 100w (2.4kwh a day) = $180kwh in ~75 days. means
at $0.04/kwh thats a $7.20 cost for waiting 2-3 months to get 2ethereum on PoS or $3.60 per eth
yep
when they say that eth2(pos) is 99.9X% less energy intensive than PoW.. what they are hinting at is the cost of creation is X000x less costly. so expect a X000x factor decrease in value and thus an effect of a X000x factor of price speculation crash too
You are leaving out the fact that you have to spend time to keep your client software up to date. And that you are leaving all that eth locked up. And that if your PoW miner is offline you just loose what you could have mined, with ETH PoS there are penalties if you miss to much work. And so on. There was a discussion about someone staking their ETH in a VM, and they moved that VM to another machine. All was good till they accidentally spun up the old VM and it broadcast something and the validator was slashed.
PoS is not as push to run as many people think. *If it's a 'real' coin.* There were tons of crap PoS coins that could just sit there and stake in their wallets that have died off. As they tried to make it 'better' like ETH they made it a lot more complicated.
-Dave
its simple
a shift from the cost of 1.5million miners hardware and electric cost to mine a block for only 6.25coin
(hundreds of thousands of $ per block: dozens of thousands of $ per coin)
to a few dollars to sign a block..
result: massive cost reduction to make a block means those making blocks sell the cheaper, way cheaper and still profit. = value crash = price crash
..
lets use ethereum.. great example
currently over $1k hash cost to mine a eth
currently ~400k potential block signers of eth PoS
ethereum releases 2eth per block and does about 6k blocks a day. meaning each potential signer might get a chance once every 2-3 months
at a PC rating of 100w (2.4kwh a day) = $180kwh in ~75 days. means
at $0.04/kwh thats a $7.20 cost for waiting 2-3 months to get 2ethereum on PoS or $3.60 per eth
yep
when they say that eth2(pos) is 99.9X% less energy intensive than PoW.. what they are hinting at is the cost of creation is X000x less costly. so expect a X000x factor decrease in value and thus an effect of a X000x factor of price speculation crash too
a shift from the cost of 1.5million miners hardware and electric cost to mine a block for only 6.25coin
(hundreds of thousands of $ per block: dozens of thousands of $ per coin)
to a few dollars to sign a block..
result: massive cost reduction to make a block means those making blocks sell the cheaper, way cheaper and still profit. = value crash = price crash
..
lets use ethereum.. great example
currently over $1k hash cost to mine a eth
currently ~400k potential block signers of eth PoS
ethereum releases 2eth per block and does about 6k blocks a day. meaning each potential signer might get a chance once every 2-3 months
at a PC rating of 100w (2.4kwh a day) = $180kwh in ~75 days. means
at $0.04/kwh thats a $7.20 cost for waiting 2-3 months to get 2ethereum on PoS or $3.60 per eth
yep
when they say that eth2(pos) is 99.9X% less energy intensive than PoW.. what they are hinting at is the cost of creation is X000x less costly. so expect a X000x factor decrease in value and thus an effect of a X000x factor of price speculation crash too
Yes, it does have an effect on the valuation of Bitcoin. If Bitcoin moves to Proof of Stake, me and probably more than half of the older Bitcoiners are going to get out of it. Proof of Stake is in my opinion an unfair mechanism where the Rich are in advantage over the poor, which is precisely one of the reasons I am currently in progress of removing Fiat out of my life. Plus, Proof of Stake is not only less tested than Proof of Work but also provides less security.
If Proof of Stake EVER proves to be just as fair as Proof of Work and just as secure or more secure, then why not transition to it. But until then, let other coins self destroy by being the testing ground for it and let Bitcoin be the strong beast it currently is.
-
Regards,
PrivacyG
If Proof of Stake EVER proves to be just as fair as Proof of Work and just as secure or more secure, then why not transition to it. But until then, let other coins self destroy by being the testing ground for it and let Bitcoin be the strong beast it currently is.
-
Regards,
PrivacyG
How does the shift from proof of work to proof of stake consensus will affect bitcoin?
Proof of work is a proven consensus mechanism, while proof of stake based blockchains are yet to be validated. How will success of proof of stake based blockchains will effect bitcoin
Will this havr any real effect on future valuation of bitcoin?
Proof of work is a proven consensus mechanism, while proof of stake based blockchains are yet to be validated. How will success of proof of stake based blockchains will effect bitcoin
Will this havr any real effect on future valuation of bitcoin?
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