PoS cuts the opex, and makes the capex fungible.
With POW you need to make a sizeable investment, and hope you'll get a good return eventually.
With POS you can keep your money and do it almost for free (as long as you run a node, not that big of a deal).
So exchanges will completely dominate staking, but they likely not even touch POW mining.
Please don't throw around buzzwords.
I'm not throwing around buzzwords. Please don't accuse people of that without sufficient understanding to be reasonably confident you're correct.
> locking down 32ETH is different from requirement to run ASIC
This is precisely the opex-vs-capex distinction we are discussing in this thread.
32eth is strict capex. ASIC capex <<< power opex.
It is other way around. Slashing is the solution for nothing-at-stake. By requiring multiple validators to sign each block height you prime them for being slashed if they ever double sign those heights (or sell key to someone who does). Where is centralization here? Are you speaking slashing condition detection? Or maybe about slashing tx inclusion into the chain?
Correct - the decision about when to slash
Whole spiel about "only EF will run those, whole thing is centralized" is just noise. You as an attacker can't distinguish between situation when I'm running a slasher from one when I'm not. Now go and risk the attack.
The question was why "opex is the part that tethers on-chain security to reality", and opex specifically.
People should've got a clue when Ethereum forked the chain because it turned out the "immutable" smart contract had bugs and it lost the money of important people
I still can't believe anyone uttered the phrase 'code is law' unironically again after the ETH/ETC fork. After all, Vitalik effectively said he didn't care if your grandma's life savings got stolen, that's decentralization - but when it happens to the important people, well, it's time to have a come to Jesus and fork the chain.
One entity decided they were sad about code being law and decided to roll back the outcome of a faithfully executed smart contract using their influence. When one person can influence enough miners to make it the principle chain simply to undo what is in their opinion an outcome they disliked, that's centralization. Or at least a plutocracy.
Today that power rests principally with Jeremy Allaire since of course only one chain can represent the real world dollars in his bank account (USDC).
The rules of a blockchain protocol are not immutable, they can and often do change. Users decide to follow the new rules, or they decide not to. The 2016 fork showed that the majority of users and the market chose to follow ETH instead of ETC. In a few days we will probably see another fork, and most likely the majority of users will follow the PoS chain instead of the PoW chain.
It is free to run a node, and the market can freely decide to not support a chain. This is how you end up with ETC being relatively worthless even though there was a group of "rich plutocratic elites" that tried to make it succeed.
There are "influencers" like Vitalik, EF, several client teams, and thousands of hobbyists who work on research and development for the protocol, and these people do lead the direction of the technology moreso than the average user. But this is how all open source works: a small number of people make decisions, and a much larger group of people opt-in to those choices, becoming users. This is also how you end up with multiple blockchains: not everybody was happy using Bitcoin, so some people started to develop Ethereum instead.
The rest of community has decided to disassociate themselves from hacker and forked away.
Again, what recourse do you have with crypto?
I don’t see how people can call our federal system a democracy anymore just become we run elections. You need to judge a system by many other attributes.
In a representative democracy the voters are supposed to choose the representatives, but there is a lot of gerrymandering in the U.S. where instead representatives get to chose the voters in their districts. Also those with the most money tend to win elections, like +95% percent of the time, making it look like lobbyist and the rich elect representatives, not voters. Most other western countries countries call that bribery, and make it illegal.
It should be recognized that the current laws around gerrymandering and campaign finance mean that we may not really have democracy or representative democracy in any true sense of the word. Some would go so far as to say we have a two party oligarchy.
I believe the best solution going forward is to rip power from the federal government and return it to states and local governments, as was intended by the constitution. Resolving gerrymandering and campaign finance laws will not fix the political dysfunction. It's structural. Most federal institutions are not designed to be democratic.
I'm a big fan of Leopold Khor and his book Breakdown of Nations. He talks about how national governments that get too powerful become corrupt authoritarian bullies [0].
Where have you been the last few months?
This is, by the way, unlike Bitcoin which did revert the blockchain and break its immutable nature in 2010. https://decrypt.co/39750/184-billion-bitcoin-anonymous-creat...
Not sure that this matters much but as it's a frequent point brought we might as well get the details rights.
Well we know that the Bible is true...because the Bible tells us so"
The circular logic of PoS:
1. The list of valid transactions determines who has coin.
2. People with coin decide which transactions are valid.
3. GOTO 1
https://github.com/stickfigure/blog/wiki/Proof-Of-Stake-Wear...
> Because it's not a circular argument, it's a spiral argument. People with coins at time T secure the transactions at time T+1.
> Spiral arguments and circular arguments sometimes look similar to untrained observers, but they are fundamentally different.
* There is the power for some central entity to control the levers on the money supply: determine how much money gets printed, what the interest rate is, what sort of inflation rate is acceptable etc.
* There is the oligoplic power of banks which determine who gets to have a bank account, how much and at what rate credit is available to which people, what sort of money transfers are acceptable.
* There is the political power that people with lots of money command. They determine who gets elected, which laws are passed, whether they can be prosecuted or not, whose life they can destroy on whim etc.
I think Satoshi's original conception might have been to democratize the first two kinds of power. Early cryptocurrency idealist probably dreamed of getting rid of all three types of power.
I think right now, only the first one is indeed getting democratized in the sense that people can choose to "support" the cryptocurrency which they like. This is true for both PoS and PoW.
With the rise of regulated cryptoexchanges owned by rich people, the second type of power continues to be centralized in both PoS and PoW. And of course, there was very little threat of the third type of power ever being challenged by cryptocurrency - that's a property of our political systems, not of the type of money we use.
To me, it would seem that the ETH PoS centralisation of power (to the already wealthy) makes it less free than, for example, BTC. But I don't know, and I'd like to hear what they think. You too, if you'd like to offer your thoughts.
BTC also suffers from centralization of power to the already wealthy so the claim that that there is equivalency between PoS and PoW centralization sound about right.
BTC is free and you don't need any money to run a node. For ETH, you need 50k USD to do the same thing, no?
Genuinely curious here.
Cost of an ASIC is around the same ballpark if not more.
That actually is a property of the money we use because the wealthy can always refuse to spend or invest which forces the government to borrow more money.
In a PoW environment you can take some of your coins, 'stake' them by buying a share in a mining pool, and then 'un-stake' them by selling your share in the mining pool.
The only difference is how much coal is burned and e-waste is generated along the way.
In both cases control and reward go to those with the most resources to deploy within said system.
> In a PoW environment you can take some of your coins, 'stake' them by buying a share in a mining pool [...]
Playing devil's advocate: there's a small but important difference in that, for PoW, you can "stake" coins from outside the system (for instance, by buying an ASIC miner with real money), while for PoS, the coins you "stake" must come from within the system itself. That is, PoS is a closed system.
The PoS system keeps value in the system. PoS also has more ability to reduce influence of malicious miners/validators by slashing what is needed for a bad validator to continue to participate.
I’ve previously said difference between crypto and traditional rails isn't decentralization. It's eager evaluation. The blockchain is always current everywhere. Bank records are not. The latter is computationally cheaper, but at the cost of more error. Centralized banking would involve everyone having an account at the Fed.
In the Roman Republic, voting power was directly linked to wealth. Keeping tabs on who was how wealthy were the censors [1]. PoW is sort of like that, but eagerly evaluated.
Blockchains provide cheaply-verified consistency.
Bitcoin has never been about proof and verification; it's always been about the decentralized claim, but mostly as an excuse to give it a reason to exist.
"You" here is essential. For a participant in the blockchain, it's expensive. That's the cost of eager evaluation. For a non-participant just verifying, it's cheap. Cheaper than auditing bank records.
Ninety-nine percent of blockchain and web3 is easy-money folly. But there are technical advantages to the system. Had Hadoop had better marketers...
The monetary expense is _much_ higher due to the need for redundancy.
Basically instead of using money to buy all of the above you just directly invest the money itself. Which is the Stake?
https://arxiv.org/abs/1809.07468
https://www.sciencedirect.com/science/article/abs/pii/S00200...
So much for the decentralization idealogy.