Topic: There is no magic PoS bullet that's going to crash BTC price (Read 1359 times)

He's hodling, waiting for them to increase in price.

This guy has Heineken, don't underestimate a dude with good beer in a bad situation ;-)

I don't think you realize that none of these systems seem to work without being linked to a finite resource in the outside world, and that reputation is a pseudo-finite resource standing on shakier ground than other finite resources.  Like I said, this doesn't mean that it can't work, but it could also work great for 10 years then blow up, especially as people die or stop functioning as delegates and need to be replaced.  The system requires more user input to stay afloat, and the general public just wants to smoke crack and watch Gilligan's Island, not vote for DPOS delegates.  I can't even imagine the scrutiny those 101 individuals would be under if DPOS was working as a global economic system.  

You say 101 delegates is big enough "at the start", and just who is giving consensus on when and what number it needs to be increased to?  A single, centralized programmer?  If not, why would the DPOS delegates vote to increase delegates and lower their own profits?  That makes no sense.  Distributed consensus has to work on game theory and not wishful thinking.

With PoW, you vote for the mining pool. With DPoS, you vote for the delegate. It's the same thing. PoW disincentivizes mining pools from colluding and crashing the system. DPoS disincentivizes delegates from colluding and crashing the system. But in both systems, it's possible for them to collude.

The big difference is that, under PoW, there is only a handful of mining pools. The incentives are to centralize. In DPoS, you can have any number of delegates. 101 is big enough, especially at the start. Later on, you want more, you can make more just with a tweak in the software. With PoW, you have 4 pools controlling 90+% of the hashpower, and there is nothing you can do about it.

Plus, negative pressure on price.

I wouldn't say DPOS is "the answer", just a system with different attack vectors than PoW.  It uses reputation as a finite resource to link it to the outside world instead of large amounts of electricity and specialized mining hardware.  It's harder to apply a cut and dry view of the difficulty involved with gaming reputation since more human elements are involved.  Bitcoin uses game theory with simple economic principles in mind that make it easier to predict.

Energy and hardware is an actual finite resource, and reputation is kind of a pseudo-finite resource that still may or may not work.  The entire purpose of game theory is predictability, so if a reputation system has less of it, can you really say it's an improvement.  DPOS is a very dangerous system in that regard, in that it might work great, with better technical performance than Bitcoin for 10 years straight, then just implode.  Bitcoin is more predictable in this regard in whether it's doing well or poorly, instead of just instantly running into severe problems one day out of the blue due to relying on a reputation system.

The answer is DPoS. As an added bonus, with DPoS, there is no negative pressure on price from miners needing to sell to cover their astronomical mining costs. With DPoS, we'd be at 5,000 by now.

Just sayin'.

It would be cheaper and easier to create, brand, and advertise their own competing PoS coin.

A good read on PoW

http://www.reddit.com/r/Bitcoin/comments/2o71hh/physics_and_economics_will_distributed_mining_im/

tl;dr: PoW will have it's comback once the technical development of ASICS slows down!

 


What part of "Proof of Stake is a fucking joke either" wasn't clear to you? I clearly said it's shit  


I addressed problems with PoW and I said that PoS is not the answer, that's it. Why are you telling me about PoS?  

You did not address any of the issues I put forth about PoS.  It's a system that pretty much no matter how you implement it, is going to require more active participation from the public to function, whether it be in the form of staking and attempting to secure the coins you're staking, participating in PoS pool mining with NXT pool forging, or voting for DPOS delegates, etc.  It is critical for coin ownership and network control to be completely separate entities.

If this is not the case, it requires too much active participation from the public to function, unless you just want it to be a niche product for a very small percent of the population.  Many of the people in the PoS community seem to be out of touch with reality.  You would need a human demographic from an episode of Star Trek for the public to deal with all the vast intricacies of PoS.  In reality, this is what much of the human demographic is:



This guy actually could utilize a BTC debit card.  He's never going to be able to join NXT PoS forging pools, vote for DPOS delegates, or stake and secure his coins on a personal computer.  Coin ownership and network control has to be separated for the system to work with the general public.  DPOS functions in this manner, but still requires more participation than PoW, so is still sketchy in that regard.  In the wild case scenario this guy did acquire some proof of stake coin and someone instructed to him that he could earn interest with it staking, he's just going to outsource that duty to a 3rd party Bitcoin bank, (ie:  centralization).

Any baller like a Gates or a Rothschild could EASILY take over 50-80% of a POS coin in a year.. easily.

So, you don't like both?

I am of the opinion that, PoW is more likely to succeed than PoS.

Yes, but the problem is not that it's just outdated, it's that it creates a currency that is not viable long term and many big fuck ups that can be easily avoided if an alternative to PoW is used.

Whether something is outdated technology does not mean is going to succeed or fail. Its utilization by its customers is key. For example there are many articles which talk about the banking system as being outdated technology but so far its highly unlike that system will collapse. Its success is based on all the consumers that use it. As for bitcoin and other coins there are no perfect proofs. POS and POW both have their pros and cons. Popularity will decide which will be successful.

PoW IS outdated technology. It's a ridiculous waste of energy and resources (which is not necessary in order to have decentralised transactions), it invites centralisation, opens up possibility of 51% attack, and overall requires the network to be dependent on miners that need to be paid in one way or another (with mined coins as long as inflation is ridiculously high block reward is decent enough, or transaction fees). It creates a currency with slow transactions and problems of scalability and blockchain bloat.

PoW is a big problem and is outdated. Not viable long term.



Regardless, Proof of Stake is a fucking joke either.
They are not the only solutions that exist today though (or that will likely exist in the future).

I've seen a few "falliiiiiiiiiiiiing" troll posters say things lately like, "Bitcoin PoW is an outdated technology, you should sell or buy something else".  You have others trying to hype Ripple, then people like Vitalik talking about how they might be able to create some revolutionary, new, PoS system.  

Here's my response as to why I don't see this happening:

The general public, and even experienced Bitcoiners themselves, aren't very good at securing coins.  This problem has been almost completely addressed for PoW by smartcard, hardware wallets for $30.  With PoS, it's a different ballgame.  You're required to keep coins online to stake, opening up the system to problems the general public will never be able to deal with unless they outsource that activity to someone else, aka a Bitcoin bank.

PoS systems that don't utilize coin age are better for security, but provide no benefit to small stakers at all.  You have a combination of the small staker not being rewarded to stake factor, plus the general public tendency to outsource their staking to a Bitcoin bank since they don't want to deal with the risk and technology.  This means a large movement to staking centralization and exchange centralization.  It's really no different from Bitcoin PoW centralization.  The exception is that circumstances that lead to double spend attacks for PoS coins, are much more dangerous long term for most PoS models than circumstances that lead to double spends for PoW coins.

I'm not particularly positive or negative on Bitshares, but DPOS, just like PoW, separates coin ownership from network control, so it doesn't have the above drawbacks where the general public is expected to jump through hoops that they aren't going to do, and will either not stake at all, which network security requires them to do, or will just outsource their staking to a Bitcoin bank, making it possibly more centralized than PoW.

I'm aware of NXT pool forging to try and combat the issues I've stated, which is, hilariously, almost like recreating PoW pool mining.  It does have significantly less energy use than PoW, but once again, this is something that most or all NXT holders are expected to participate in to maintain network security, and the general public is just not going to do it.  Once you start trying to fix the core issues of PoS, you start to run into issues that make it so the system might be too complex for the general public to use, since it seems to demand much more active participation than PoW, while also assuming everyone walking the planet is a combination of computer science and finance major.

The biggest issue of DPOS, is even if it's 100% positive your initial 101 delegate rollout can't and won't collude, how can you make a system to ensure that when they either stop delegating or die, that their replacements won't be colluding.  Delegating as a DPOS participant should be a revenue stream, but maybe you will receive a more attractive, instant lump sum to sell out.

In summary, if Bitcoin PoW is ever found to be an inferior system to whatever PoS system emerges, Bitcoin PoW still has a large chance of beating it without even factoring in the network effect, just from being a much more simple and straightforward system.