Topic: PoW vs PoS - page 4. (Read 893 times)

there are many layers involved.

but there gets to a point where those remaining miners have a bigger slice and decide they want to keep that bigger slice by expanding hashrate because they can afford to upgrade to keep the bigger slice. which then plateau's/levels out a dip to a new bottom that is non zero

in both the market and mining. there is a limbo area where seller become buyers. and lack of hash competition becomes upgrading hash

Mmm, is this really the case? It could also be that if mining value becomes lower than BTC value, then some miners will stop mining. Miners stopping mining will reduce the protocol's difficulty, which will make mining value easier to meet.

The most important thing that distinguishes POW from POS is network security as well as decentralization. The POW that Bitcoin operates on is the most secure and more decentralized and the more hashing power the more secure the network and this makes it very difficult to hack, but at the same time this makes the transaction take longer and the fees are higher. .
As for POS, I think its main advantage is lower costs, which makes fees lower and transactions faster, but the network security is much lower and there is a risk of the network becoming centralized if the largest share is concentrated in the hands of a few groups.

There's alot of fud and lies in your statements.  Do you happen to be affiliated with the state of china perhaps?   The attempt to frame bitcoin as a cult is number 1 the lie about china banning bitcoin to save power grids is 2.  if Texas has a power grid issue with the large scale miners you would think something would be said Prior to them setting up eh? lots of Private grids in Texas.  They are weird like that letting the free market decide.

Which is what bitcoin does.  Free market.   Coins like cardano are based on things that haven't even been invented yet.  Like common sense oracles(currently no such thing) how can you create a contract about a job to rake a lawn is 1 the oracle doesn't know what a lawn is.  2 what its supposed to look like or if the jobs done correctly to satisfaction.  its totally subjective to human perceptions.  thus a very limited coin imho.

I know what you said about underlying cost and I agree; I'm just telling you that you shouldn't compare gold or the groceries with bitcoin. When it comes to bitcoin, there's no underlying value. It's the demand that determines what the cost will be.

If the whole world adopted it, the demand would rise and so would the difficulty. If suddenly lots of us dumped it, the difficulty would drop as well. It's the difficulty of mining gold that determines its underlying value.

And the minimum market value IS the cost. I just used that term, because you keep saying “cost is not value” and that's confusing. There are lots kinds of values such as personal, market, intrinsic etc.

Yes , it would be, but bitcoin cult members can't grasp that, for some reason it destroys their dogma,
kind of the same way they refuse to do anything to improve onchain transaction capacity.

Asking that question here and you get a slanted one-sided replies, PoW good, PoS bad,
but if you want the truth look at coins such as Cardano and Algorand, PoS V3 blockchains,
their performance and cost & energy efficiently exceed bitcoin by leaps and bounds.

All one has to do is look at the majority of new coins and no one bothers with outdated Proof of Waste anymore.

Biggest question is how long can a Country or State, continue to support an ever growing PoW energy drain before their power grid collapses.
China wisely banned all Bitcoin PoW Mining to protect their power grid and their people,
Texas has foolishly taken up the slack, and could suffer a fatal power grid collaspe this winter thanks to being suckered into allowing Bitcoin PoW Mining.
You can monitor Texas power grid here: http://www.ercot.com/
Within 1 - 2 years, Texas will also be forced to decide save their power grid and their people, or rolling blackouts until the total grid failure occurs all for the sake of bitcoin PoW miners.

 

comedy gold

people really cannot see behind the retail prices of good. people cant understand there is more that makes up the price.

one guy argues bitcoin has not underlying cost and the price is 100% speculative emotion
one guy says the cost is the price

both wrong

if fresh pasturised milk was sold by the farmer at the same price the supermarket sold it to the customer then no one is profiting.

sorry but cost and price are not the same thing

have a nice day though

You are wrong because you are thinking too much in terms of gold just because the word we use for both is the same ("to mine").

But what you are forgetting is that whether gold is worth one cent or a million dollar the cost to mine it is going to be the same simply because the process is the same.
However, this is not true about bitcoin. If bitcoin is worth one cent the cost of mining it is going to be proportional to that price, and if it is one million the cost of mining it will be higher to be proportional to one million dollar price.
This is one of the reasons that sets bitcoin apart from everything else. Bitcoin value is always defined by its utility and adoption. All you can say about mining is that it contributes a little to that value by providing security.

So you can't even begin to compare bitcoin's cost of mining with gold's and them create a correlation between bitcoin's value and that cost.

and it seems after having many conversations.. your thinking about minimum market value as if its talking about active daily price (because you used the word market)

maybe if you read the analogies you will detach your mindset from the PRICE. and take the word price out of your mind. put it on paper then throw away the paper.

read what i actualy said. its not the retail/spot price of the market. its the underlying value cost.
such as say the hidden cost of mining gold. or of the farming cost of fruit, veg, dairy

lets use dairy/veg as it seems you dont understand the gold concept
again forget the retail price customers pay at the grocery store. snap that grocery store price tag image out of your mind and burn it. please.

now think about the cost the farmer charges the retailer..
now think of the lowest price the retailer MIGHT charge if there was an over supply and little demand..

again not the active current price they charge a customer.. but the lowest charge they would dare sell at if supply was high and demand was near zero. and i mean complete bottom charge just to break even of their own cost of acquisition

they still would not give food away for free but the ultimate discount they would ever offer .. thats the underlying value... its a number all supermarkets secretly have.. but something you will mostly never see on a pricetag a customer gets to see

its not the markets daily hi-low.. its what some refer to as 'the new bottom' the the new zero.

the underlying value is a value line in a sandwich filling of all aspects that load up along with supply and demand speculation where the social drama and emotional decisions is the top piece of bread.

if your still after many conversations and many reminders and analogies only seeing the PRICE as a single number. and not the layers of what build up the price.
.. well its time you stop having conversations and start doing research.

and buy the way..
gold miners cost is not $1700.. so please.. do some research
gold miners cost is about $900.. they add on how much they want to profit.
then the smelter buys it below spot. the smelter has his own added value. and then it turns into a spot price.

gold is not sold for $900 right now.. go check google.
yet gold mining COST is not $1700 either

do you get it yet
its not about the gold market(spot) low of the day/week

its the underlying value of gold
you might see it occassionaly with the 'cash for gold' jewellers and scammy rip off merchants offering $900 to people for their jewellery as they try to buy gold cheap without having to do the hard mining. but they then sell the obtained gold for $1700 on the public market

..
now i hope you have finally got the concept.
PoS coins do not have this layer at the bottom filling of a sandwich. PoS has no cost. so PoS is purely speculative supply and demand

How's that? It's not immediate, but you do earn bitcoins if you already have bitcoins, if you think about it. If those owned bitcoins allow you to purchase mining equipment and you're willing to pay electricity for those ASICs, then you've essentially created new bitcoins by owning bitcoins.

In PoS, one creates coins just because they prove they own coins. But, isn't the same thing with bitcoin, after all? Isn't computational power translated into cost which can be paid with bitcoins?

Many, biasedly, skip this.

I've had this discussion with you in the past and you repeat this very mistake. The cost DOES NOT mean the minimum market value in bitcoin and thus, it is wrong to compare it with gold. Gold costs a specific amount of monetary units to be extracted from the ground and the buyer has to pay those at least so that it can be profitable for the seller. But, bitcoin DOES NOT have this specific amount. It's the way people evaluate bitcoin that determines the minimum cost of it.

And that's because no matter the effort, every 10 minutes, 6.25 BTC will be inserted into circulation. The demand and the miners' profit increase analogously. (ceteris paribus)

In my understanding Mr.Satoshi Nakamotto developed only POW and all other algorithms are derived version of Satoshi's idea and not proven against mass transactions and double spending. So, I guess that we cannot expect bitcoin to be adopting a new algorithm for any reasons. Personally I have good opinion on POS algorithm as all the money required for mining are not moving away from the ecosystem but being spent within ecosystem which will definitely get more value for a coin.

We cannot underestimate Mr.Satoshi Nakamotto's works hence at first hand I guess we cannot dream about getting into POS algorithm for simple reasons. Probably bitcoin may opt for hybrid mining thing like both POW and POS and the block rewards to be split to both kind of miners in extreme conditions like POW needs some modifications.

They were disappointed with ETH too and yet that didn't stop ETH from making a new ATH. Miners are just paid slaves of the network. If people approve the changes, miners will have to accept it. Otherwise they'll mine an empty chain just like they are doing with bcash. Remember how they all didn't want segwit and they approved it anyway.

POW has the best security available but comes with certain tradeoffs as you've mentioned. Even POS has its own benefits and shortcomings. A POW chain is very expensive to run and that's why even ethereum is going POS mode soon. Why I don't like longer transaction finality and high tx fees, I do like the security and level of decentralization achieved on Bitcoin compared to other chains where users delegate to validators.

maybe if you take a break. sit back and relax for like 30 minutes and realise.. PRICE IS NOT VALUE

many people think the only thing that exists in life is the price. one point of measure. one level..
however this is not true.

the PRICE is made up of layers. like a sandwich

PoS is a meatless lettuce and tomato sandwhich...
PoW is a BLT of bacon lettuce and tomato

yes both have lettuce and tomato. but your missing out on the bacon
the underlying value is the bacon..
the lettuce and tomato is the supply demand sentiment

imagine gold. as explained before.. the cost of the diggers, the labour, the diesel the sluice machines the licences of water/land rights. all form an undeniable underlying cost.
however treasury bank notes. have no real cost. its like a quarter of a penny to print a piece of paper smaller then a post card

notice the difference
yes a $2k bank note and a $2k gold nugget both have the same PRICE. but their values are different.
people would rather have the nugget. as the paper bank notes price wont be as good in 20 years as a nugget

a bank note in 20 years will buy less loaves of bread than a nugget would

take anything. fruit. bread.. dont ever look at it as just the retail price.. learn and understand the wholesale price the manufacturing cost. then you will start to see if different items are being sold at excessive profit or at good value. never judge value based on retail price but based on how much they are skimming off customers from the underlying cost

Pow will give every share of computing power an equal opportunity to become the master of the Bitcoin system.

You are completely changing the discussion. I'm not talking about a franchise with a huge chain everywhere deciding whether to open a new shop in another country.

We are talking about a small business known as bitcoin miners that have a dozen options in front of them to migrate from China to one of them. I'm saying that for such miners there are lots of much better options available compared to US for many reasons that I mentioned earlier one of which was political relations.

Otherwise you are right about other stuff, China has US economy by the balls and talks of WW3 is a joke mainly because US military has been a joke for at least 60 years.

I disagree with that first statement, since there's essentially the same "intrinsic value" for both PoW and PoS coins, which is what you wrote in your second statement, i.e., they're worth whatever people are willing to pay for them based on various factors.  I don't buy that whole "bitcoin is backed up by all the work and electricity involved in their creation" argument.  I never did, because it makes no sense to me.

The good thing about PoS coins is that you can earn income from them, which isn't the case with bitcoin.  And a few of them are useful for their smart contract functionality and so forth.  The main problem I see with them in terms of their utility as currency is that people are incentivized to hold them and not spend them--and that also isn't true for bitcoin.

You have to admit, PoW coins do use up a lot of electricity, even if it's a small amount compared to other things.  I happen to like the idea of being able to mint new coins simply by running a wallet, but I'm also aware that that particular feature can lead to centralization of the coin if the majority of them are in the hands of whales. 

As @Dave already mentioned in the first posts there are already many topics about POS and POW and in these topics, you can easily understand the difference between these two but if you want to have a real short definition let's say the pow algorithm works whenever you mine the coins using physical miner devices or your personal computer and in this method any miner should stay online during mining to get the clocks confined while in pos you won't need any devices and not even a simple computer, you coins are mining for you and you will earn more share if you have more coins for staking, Tron can be one good example of pos coins.

It currently doesn't,  I totally acknowledge that it may never be a problem.  But Humanity is the one buying and selling thus the reality of the Pareto distribution says otherwise.

bitcoin mining does not have a centralisation problem

take antpool which for half a decade was smeared as being "china" truth is antpool as 3 stratums. one china, one american one european. so china cant exactly just shut antpool down.
all antpool need to do is change its website/server. a 2 second job, and business as usual if authorities came knocking.

as for mining farms. they suffer from what is known as facility limit. they can only house a certain amount of asics per building. again no pain for them. they can have several buildings. even less pain the buildings dont even have to be at same location. they can simply remote control which 'work' to sent to each building no matter the location.

as for the pareto problem. bitcoin is different. although the top 3 pools have most the hashpower. the hashpower is not all their own. its users voluntarily linking to that pool. and users if they see their pool getting to 50% most see their 'slice' of the reward get thinner and thinner.  and so they pool jump

there is however a 'class divide' problem
where home hobby miners with 1-3 asics due to residential limits on electric circuits. and affordability of only a couple low efficiency asics (s9) mean that their daily income per kwh is less than say a mining farm

this is also shown as a divide because say for instance an s9 at 14thash. vs an s19pro at 110thash has a 8x efficiency of hashes for only 2.5x of electric draw... the hardware price however is not in the 3-8x area.

it costs more then 8x price of a s9 which prices people out of gaining in the electric efficiency
.


lastly. as for the PRICE.
people keep forgetting the bitcoin price is never and has never been based on all coins in circulation.
most(all currently) price movements are not movements caused by people having to own a whole bitcoin to put that whole bitcoin on a orderbook to sell at the whole bitcoin price just to trigger a movement.
instead people are making orders of 0.001($60) and making the price move a bit at a time. so the price does not need whales with hundreds of bitcoins
yes it would be good to have all the whales put in 'beached whale' orders(walls) at sat $55k so that no matter how many sellers want to sell they will never devour a $55k wall
but my point is the bitcoin price is not based on masses of coin