Topic: Would bitcoin survive with more efficient mining? (Read 199 times)

The model is flawed since ASICs. They are mainly staking mining hardware and that hardware is only useful inside the bitcoin ecosystem. And anyone CAN'T mine. Only those can mine that will purchase a highly specialized equipment and have access to low cost energy. Centralization will only increase more over time because of the principle of mass production. It is always cheaper to mass produce something and this will make the smaller competition non-competative.


PoW mining is even more centralized, considering geographical factors playing an important role.



Mining power is also centralized in pools. There have been more threats in 51% with pools to bitcoin then there have ever been to any slightly popular PoS coin with 51% ownership.


Thank you for the replies, but I think that you haven't exactly thought this subject through.

Instant transactions and low transaction fee are the main criteria for bitcoin to be widely accepted as a replacement of fiat for daily use and resulting in the increase in the chances of survival of bitcoin. These criteria can be achieved by more efficient mining Russia encouraging miners by making tax free mining areas will have a huge impact on its usage. To make mining more cheap and efficient it should be done in cold places to prevent overheating of machines reducing the cost of cooling machines for the mining machines.
Samsung has initiated mining through smartphone will surely affect in mining and advancements in it might also make cheap and low energy-consuming BITCOIN mining through smartphones possible.

Look, on PoS there is a limit amount of coins. You can only buy more coins if someone sells them to you.
You are staking something from inside the blockchain.

On PoW you are using energy from outside the system. Anyone can mine and contribute to the mining power to the system.

Mining is not as centralized as staking coins. Mining and electricity are not limited by hardcap (like coins). Every time a new agent is joining the system.

Lets suppose 50 people own 51% of coins. Nobody will ever get 51% of the coins if they never sell.
But if someone has 51% mining power, that can change anytime and nobody can control it or prevent people from entering the system.

If you can't understand that, at least I tried. I did my best.

I spend a lot of time writing that post above and you didn't even read it. Well, not reason to argue with you anymore.

Bitcoin price is more related to mining difficulty, actually it is what backs the price per coin. Supply & demand sets price of any trade-able assets like bitcoin so if it will be hard to get but have high demand than price will go up and if there will be less demand price will go down.

If mining will become cheaper than price of bitcoin can't grow with time as miners can easily be in profit even if they will sell bitcoin at lower prices. That doesn't make sense and actually shifting bitcoin to new type of algo will have catastrophic effect like total split of community support just like in case of bitcoin cash fork. 

Sorry, but your post doesn't include an explanation on why PoW is more secure.

This sentence:
In a PoS network the consensus is based on how much coins you stake, and a group of rich people will have a huge share. So it's centralized on those agents.
Those agents can be coerced, controlled by regulation, bribed

Could be just as well changed to this:
In a PoW network the consensus is based on how much mining hardware you own, and a group of rich people will have a huge share. So it's centralized on those agents.
Those agents can be coerced, controlled by regulation, bribed


PoW and PoS share most of the flaws. Only except PoS doesn't share the flaw of being overwhelmingly expensive to run.

In a PoS network the consensus is based on how much coins you stake, and a group of rich people will have a huge share. So it's centralized on those agents.
Those agents can be coerced, controlled by regulation, bribed....

In the bitcoin network, mining is now somewhat centralized in China, but this situation is temporally. We see now, for instance, that Russia is heavily investing in mining.

It's also possible that Bitcoin mining hasten the adoption and development of renewable energy systems. As renewable energy becomes more efficient and low cost, Bitcoin mining is a way of earning money from excess energy being produced. Households, farms, maybe soon be buying solar panels to mine bitcoin.

This is possible because anyone is free to add their mining power to the network. In a PoS system, someone needs to be willing to sell their stake. PoS centralization is not a problem for a company, but something even desired, as centralization is a good protection (if company owners have 51% of the coins) against hostile agents from outside the network. But you don't want that in a world currency.

As I said in the first post, bitcoin is not switching to PoS. But other altcoins can do it as they are companies with different objectives.

I can correct my reply and ask...

Please explain to me how is PoW more secure to coercion, controlling regulations and censorship then PoS?

It's funny that I didn't mention 51% attack, and you started your posting replying my "51% attack quote" lol
And are you accusing ME of whataboutism?

I didn't try to discredit or offend you, you were just spreading misinformation about 5 million crypto users and talking about this old PoW PoS switch thing...

51% attack is a low threat attack with both PoW and PoS. If you either purchase a lot of hardware that's only use is to mine a digital token, or you purchase the token directly, doesn't matter, but by purchasing you will lose motivation to carry on this attack. In reality, the biggest security threats are still vulnerabilities in weak operation systems or 3rd party needed software needed to use bitcoin. To scare people with the 51% boogeyman is just trying to justify this rat race mining circus.


You are claiming, but you aren't explaining. The same positive sides that you bring out of PoW, will also apply with PoS. You are claiming that PoW is more secure, but it's not. It's just a secure, but only cheaper.


In my opinion, Andreas Antonoupolos is a shill in the most exact meaning of the word. Here again he is praising energy waste. He is trying to make it seem like the 7 billion dollar black hole is actually creating stability of the market. It's like saying, give me 7000 dollars every month, then you'll get stability by knowing that you will loose 7000 dollars every month. Worth it eh?



Whataboutism is a popular form of demagogy. A dishonest way to make your point more acceptable. And the banking in general and bitcoin is as comparable then a fidget spinner and a Rolls-Royce 900 Trent turbofan engine. The magnitude, properties and the general concept of things is just totally different, with only very vague similarites. To mix this with whoutaboutism is quite ugly.. https://en.wikipedia.org/wiki/Whataboutism

The design flaw is in ASICs. With ASICs, if the price drops, then hashrate won't drop for a simple reason - you can't do anything else with this hardware then mine bitcoin. Even if the price drops, then hashrate won't drop because even if you mine at a loss, then it's still better then to shut down the hardware you have already bought. And you can be sure that speculator markets are the ones who will pay the bill eventually.

The point he was making, which you seemed to have missed is that if the cost of mining was too high so as to where no one did it, the difficulty would drop until mining would become profitable again. It is designed in such a way so that the price will never be too high or too low depending on what the current market is like

I don't know where did you get that data from, but just in Brazil there are 1 million SSN (social security numbers) registered in exchanges.
Cryptocurrency outperforms Stock Market in number of investors

And Brazil's bitcoin volume is very low, around 0.5% of world total, according to coinmarketcap. (Foxbit is our biggest exchange with 50% country volume and around 0.2% total volume in BTC coinmarketcap)

So, if we 1 million users have around 0.5% world volume, 100% volume would be like 200 million users in the entire world. I think it's less, but I don't think much fewer than 100 million.


About switching from PoW that's not happen with Bitcoin.
Bitcoin needs to be more conservative. Every cryptocurrency depends on bitcoin security. PoW is a very strong system.

PoW is build by anonymous participants in an open and decentralized network, which makes the system very resilient to coercion, controlling regulations and censorship.

PoW alternatives, like Proof of Authority, Proof of Stake, are all much more centralized and not resilient to those attacks mentioned.
Other coins, like IOTA (PoA) and soon Ethereum (PoS) are using those methods. But ethereum is already centralized as it's Vitalik's blockchain. The main purpose of Ethereum and IOTA and different, so I think it's ok for them to try those less secure methods.

Some other day I was listening to Andreas Antonoupolos talking about PoW and PoS.
He explained that PoW is somehow a PoS. In PoW miners are staking electricity, a much more stable and valuable (in the entire world) stake than any coin out there. But PoS is not PoW in any sense.

I think possible with better computers and/or some changes in the code, bitcoin mining problems (like centralization and cost) will be solved, without switching from PoW, which is more deeper and stronger than initially believed.

Edit: Also, think about how much energy the whole banking system consumes. Probably more than bitcoin.

Thank you for the reply.
Do see 2000$ per user annual cost for a payment network as a sustainable model?

I find that software security will still always be dependent on the security of needed 3rd party software. That most realistic threats will remain towards the user, no matter the hashrate. Users will still be vulnerable for mostly using windows and not being careful with their traffic. The 51% attack is theoretical anyway, with hard to imagine on why would anyone be motivated to do so. If you buy up hardware that can only be used to produce a digital token, then you don't want to hurt the value of that token. So, 51% is a low threat anyway and 7 billions dollars wasted for nothing.

I think that bitcoiners without financial background are blinded by that market capitalization number. They think that this 7 billion dollar annual cost is just a drop in the ocean. But this is where they're wrong, since bitcoin still has few active users and very little utility. This cost is just way too high for the users to handle and will make bitcoin a Greater Fool Addicted Pyramid Scheme. PoW mining is a black hole that is sucking 7 billion dollars of real money away from bitcoin markets. And this is "Real Money", not "Wishful Thinking Money", that only shows up in virtual numbers. The same kind of Real Money that is currently sucked out from bitcoin markets by the mtgox trustee. The current situation shows how fragile bitcoin value really is and how little there is needed to make the large market cap. shrink.

I don't see where the problem is. We have way more than enough security in bitcoin, the hashrate is huge. If a big chunk of miners stopped mining for whatever reason, the difficulty would go down and someone else would find profit.

Speculators speculate around the fact that the coins are limited in supply and the fact that Bitcoin remains "the next Bitcoin", namely, there are no better projects out there that could take the #1 spot realistically, so if you want exposure in crypto you want exposure in Bitcoin. Again, I don't see a problem in mining. Changing PoW algo would crash the market.

When speculating on the future of bitcoin, then one must try to block out the noise and concentrate on the simple facts.
Important facts are that bitcoin mining costs around 7 billion dollars a year and that bitcoin has 5 million users the most.
That means that if no new speculators enter, then every active bitcoin user must pay over 1000$ per year just to sustain the network. And remember, the 5 million active user count is also a very optimistic count, so the cost is more like 2000$ per user annually. Do you think that users would actually do that? use their own money just to sustain bitcoin value and mining? I think not. That is why the inefficient and costly bitcoin mining will turn this project into a de facto pyramid scheme. If only new money entering can sustain the project, then things are what they are.

There have been some ideas to switch from PoW mining and I think that it should get more praise from the speculators. If bitcoin would switch to a more cheaper and efficient solution, then speculators are the ones who gain the most. Speculator markets are currently the ones who are paying insane prices for miners to solve a problem that could be solved a lot cheaper. If that would make bitcoin mining costs cheaper from 7 billion to 1 billion, then it would mean 6 billion more will stay circulating in the speculator market and wont be paid for electricity and hardware.
Cheaper mining will help bitcoin sustain itself, even if the flow of new money will weaken. The markets would be a lot more profitable and it wouldn't start to turn into a pyramid scheme.

Remember, the goal should be to get maximum utility from minimum costs, not the opposite. Don't be blind with satoshis religious dogmas.