I've lost you there. So I need to have my client running and up in order to accumulate coin age?
No, they will accumulate age regardless. To attempt to mint new coins with the accumulated age, you will need to unlock your wallet. 
Topic: Proof of Stake leads to hoarding? (Read 678 times)
I tend to look at my PPC wallet as a form of long-term savings account, with PoS minting as an incentive for occasionally unlocking my wallet and setting it to mint. The main catch with PoS is that the coins that were used to mint new ones temporarily become unavailable for a few hundred blocks or so, depending on the coin (PPC is about 520 blocks IIRC, not sure what other PoS coins are like), so if you need to spend them immediately after, that option is not available. Not sure if future Peercoin clients will enable an option to set aside a pre-determined amount to not be used for PoS, but worth bearing in mind nonetheless.
Yep, with a PoS coin, you need to have your wallet open and unlocked. The PoS part of the coin isn't just a an interest they give you for holding coins. It's actually a way the coins you hold are infact "mining" the PoS part of the coin, which is another way of securing the coin from a 51% attack. In theory (I don't know if it actually works this way), but the attacker needs to gain over 51% of the PoW of the coin (Which can be easy in many cases when you look at all the cryptocurrencies out there with about a 1-2 Mhash network.) but they also need to have 51% of the Stake in the coin, which is added in coindays, so if an attacker wanted to attack an old coin they would need to own a significant portion of the coins in order to pull it off, which would in turn cost the attacker a fortune to destroy the coin.
Many people disagree with this, and as I said this is the theory, It probably doesn't work as well IRL.
Many people disagree with this, and as I said this is the theory, It probably doesn't work as well IRL.
People spend dollars even though the more the hold, the more interest they gain...
Fiat devalues over time... You can invest fiat, but that's a whole different issue.
Yes, proof of stake incentivizes hoarding.
You could probably make a super volatile, ridiculous cryptocurrency by making it both entirely proof of stake and having the stake reward decrease over time a la bitcoin's PoW reward.
For the moment, the bigger problem seems to me that it requires an unlocked wallet to use the coin age.
I've lost you there. So I need to have my client running and up in order to accumulate coin age?
People spend dollars even though the more the hold, the more interest they gain...
Hahaha! This is an excellent counterpoint.
This means that the more coins I hold the more coins I get. This looks like a problem to me. Wouldn't this lead to hoarding?
I agree this seems like a problem generally but 0-2% should be tolerable, maybe even preferable.For the moment, the bigger problem seems to me that it requires an unlocked wallet to use the coin age.
People spend dollars even though the more the hold, the more interest they gain...
Bitcoin is being hoarded now no less than any other crypto.
The reasons are: 1) cryptos are still in their infancy and there is an ongoing process of market price discovery at its initial stages, 2) cryptos still don't have many places where you can spend them. These two apply regardless of whether it's a PoW, PoW/PoS or PoS. Once a more balanced price is established and more and more businesses start accepting cryptos, people will spend them, no matter what crypto this is, no matter what 'proof' they are based on. Of course, they will try to spend their fiat before they spend their cryptos, according to Gresham's law
The reasons are: 1) cryptos are still in their infancy and there is an ongoing process of market price discovery at its initial stages, 2) cryptos still don't have many places where you can spend them. These two apply regardless of whether it's a PoW, PoW/PoS or PoS. Once a more balanced price is established and more and more businesses start accepting cryptos, people will spend them, no matter what crypto this is, no matter what 'proof' they are based on. Of course, they will try to spend their fiat before they spend their cryptos, according to Gresham's law
Hi,
I've been reading about Proof of Stake based mining/minting/forging and I seem to miss something about the concept. The way I understand it is that you 'gain' coin by holding on to your existing coins (I've been looking at NXT specifically, not sure this applies to all PoS coins). This means that the more coins I hold the more coins I get. This looks like a problem to me. Wouldn't this lead to hoarding?
The one obvious argument is that if a monopolist arises, no liquidity exists in the market and the price plummets. Thus it's in the interest of the monopolist to keep money flowing. But a monopolist is a thread to the system however benevolent he is.
I'm concerned about the lesser variant in which a bunch of people hoard and constrict the flow of coins.
Am I understanding PoS correctly?
I've been reading about Proof of Stake based mining/minting/forging and I seem to miss something about the concept. The way I understand it is that you 'gain' coin by holding on to your existing coins (I've been looking at NXT specifically, not sure this applies to all PoS coins). This means that the more coins I hold the more coins I get. This looks like a problem to me. Wouldn't this lead to hoarding?
The one obvious argument is that if a monopolist arises, no liquidity exists in the market and the price plummets. Thus it's in the interest of the monopolist to keep money flowing. But a monopolist is a thread to the system however benevolent he is.
I'm concerned about the lesser variant in which a bunch of people hoard and constrict the flow of coins.
Am I understanding PoS correctly?
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