Bitcoin Forum

PoS may come with its benefits, but it's not the best way to achieve decentralization. We've witnessed the events of the STEEM hardfork when a big exchange like Binance supported one version of the Blockchain with user's funds. Even though most of the STEEM community was against the hard fork (as it stripped some witnesses' access to their funds), it was eventually accepted by the network with Binance dominating a large portion of the coin's supply. The DPoS model of STEEM gave Binance too much power by staking user's funds. This is dangerous for PoS coins as a whole, as centralized exchanges could have the final word in approving/disapproving network upgrades, freezing accounts, etc. Imagine something like this happening to ETH once it becomes a full-fledged PoS cryptocurrency. It would be a complete disaster!

What are your thoughts? ???

I like the way how you come up with scenarios which could indeed pose a danger to the future of decentralization in various projects because of POS. Proof of Stake might be a better alternative to prevent huge emission of heat and preserving of electricity but they are the way through which we could always attain decentralization. I wouldn't say Bitcoin over powerful reliance on ASIC would make them decentralized but ASIC resistant mineable coins like XMR would achieve true decentralization. Apart from this, POS could possibly solve the transactions faster while comparing to PoW but they would prefer users to stake a certain amount for prolonged periods of time.

CZ was trying to manipulate Bitcoin mining while the Binance hack took place, but it was disregarded by the community but in terms of PoS CZ has greater control on miners than PoW miners. This is why Bitcoin should move to ASIC resistant mining in near future to improve the decentralization on a grander scale since every home user could mine bitcoin with their GPU alone. Nowadays I do believe, XMR has solved the problems which were put forward by bitcoin and could act as an better version of cash in the near future. I have no clue regarding the internal workings of Delegated POS model but POS on the long run would be surely malicious and end up with huge exchanges having the power to control the transactions and mining.

Exchanges support hard forks or swaps only to build up their reputation and keep old users staying at their exchanges, attract new users (from bad support exchanges for forks, swaps).

Exchanges create pools for invest, lending, staking to gain their benefits from service fees and when one person use one exchange, activities are not restricted to staking only. That user will use exchange for trading and bring trading fees to the exchange. In addition, withdrawals will be submitted and bring other incomes to exchanges when they save fees from batch withdrawals.

I agree with you that decentralization is a must and should be kept as much big as possible. Many people join crypto market but don't care to learn and practice. They want things are easy, convenient, one click to finish. Exchanges give them those convenient services. I loud of lot when some people I have conversations with don't know what is hashes of their transactions.

A hybrid consensus algorithm (PoW + PoS) would essentially solve the problem of PoS centralization. Ethereum devs should've placed emphasis on this in order to maintain the blockchain as decentralized as possible. But they're strongly convinced PoS will work as intended without showing signs of turning back. I'm afraid ETH will become nothing more than a centralized ledger in the long run, as big exchanges like Binance and Coinbase will control most of its supply. They'll become the top validators on the ETH blockchain with users' funds. Once that happens, ETC will be left as the only decentralized version of Ethereum in the crypto/Blockchain space.

If I were a developer, I would propose a hybrid consensus algorithm for ETH which combines both PoW and PoS. PoW will be used to secure the Blockchain, while PoS will be used for scalability. Even if exchanges control most of the coin's supply, they won't be able to dictate the network's future as consensus will be driven by PoW miners. In essence, the network remains decentralized while obtaining the benefits of PoS' energy efficiency and scalability. What will happen with ETH in the long run after the PoS upgrade, is yet to be determined.

Nonetheless, people don't care about decentralization if they're able to fill their pockets with money. They're only focused on convenience and ease-of-use. As long as there's money to be made, nothing else matters. I hope that someday people will realize that it's all about decentralization in order for crypto/Blockchain tech remain resilient against government censorship and external attacks. Bitcoin is and will always be a winner in this regard, as no other cryptocurrency can outmatch its level of security, reliability, and decentralization. There's a reason why Bitcoin, Monero, and most other PoW coins haven't upgraded to PoS yet. It's not about energy efficiency or high transaction throughput, but rather decentralization and censorship-resistance. And so far no other consensus algorithm comes as close to PoW in this regard. Just my thoughts ;D

ETC is far than a dead project but it is not good enough to call as an active project. The Github of ETC has limited activities. https://github.com/ethereumclassic

I agree with you on the suggestion with hybrid of PoW and PoS for Ethereum but the plan is set and as you discussed, Vitalik and Ethereum team did not make a preventive plans, plan B to come back when their PoS fails with the mission to keep ETH network as decentralized as it is.

Convenience, easy to use and profitable for their capital investment are priorities of most people. Centralization/ Decentralization is not what they care of.

Sadly, this is the path most cryptocurrencies are taking lately in order to gain the attention of mainstream investors, traders, and businesses alike. They've shifted their views of decentralization in favor of convenience as greed is more important than the long-term viability of Blockchain technology. Despite Bitcoin's high fees and slow transaction confirmation times, no other coin has been able to outpace it when it comes to achieving high decentralization and censorship-resistance. ETH is decentralized now, but that could change in the future once it becomes a full-fledged PoS cryptocurrency. Who knows if after the upgrade, Ethereum Classic will start to gain massive traction in the mainstream world?

Nonetheless, time will tell us whenever PoS coins will last for long or fade into oblivion. Everything will depend on developer's decisions over the project itself. As long as decentralization is kept in mind, the underlying blockchain network will be able to stand the test of time. Peercoin is a good example of a PoS coin that's decentralized because of its hybrid approach to consensus. Exchanges won't be able to have the final say on Peercoin since there's a separation of powers. Both miners and stakers will need to reach an agreement for the network to adopt/reject changes in the long run. If ETH did the same thing, it would've had a better chance to outlast its rivals. As no one can predict the future, PoS coins' fate remains highly uncertain. Just my thoughts ;D

In my opinion when it doesn't matter whether if it's POS or POW but when it was getting fully centralized into one of these consensuses and then it would not be fair and why?
When we are taking the problem that happened in EIP1559 of ethereum and it was facing a big problem caused by miners are opposing the proposal.
The buyers should also get the power to vote about the implementation of the improvement proposal.

Im interesting in the hybrid system that will be giving power to both 50:50 for miners and holders. As a store of value and bitcoin must be decentralized but it's different from ethereum that used for the various ecosystem. POW can also make centralization of its system just like the big miners are having power accept or reject the proposal on their own way.

As OcTradism, ETC is a shitcoin but the only use case of this is that they are good at mining profits. Eventhough ETC is suffering serious 51% attacks for most of the time, they are being adopted by the community for being a good profitable coin in terms of mining.

Decentralization has gone a far away and we have shifted completely to a new era of cryptocurrency after stepping up of Binance and its overpowerful actions on the community. For instance, we do know BnB is highly centralized but still people support them because of the extraordinary growth rate of Binance and the scalability factor of Binance Chain. There is an interesting event to cite as an example here :

Last month, there was a poll ongoing in one of the reddit groups focused on crypto that where users are willing to hold their coins and there were 3 options given to choose from : one was exchange wallet, second was private wallet like Electrum/Trust Wallet/Exodus kinda and third was Mix between Exchange and Private wallets. Out of 33 voters, 17 had chosen they hold their crypto only in exchanges. From this vote we can very well say that cryptocurrency on the whole has become speculative and centralized. Majority of the people who come are only meant to be useless traders who has no knowledge on why bitcoin was created and why it is advised to store bitcoin off the exchanges.

You should be aware of the famous Beeple Digital Art auction which had the winning bid of $69 million which shook the NFT market. It has become easier to make money in crypto and every new 2020 users are enjoying this bull run without knowing where these would end. 95% of the new joiners never know what happened to Mt.Gox and why oldies are afraid to store crypto in exchanges. Either we need to educate more and more or should move along with the crowd by becoming greedy and trading shitcoins!

Binance Smart Chain (BSC)
https://bscscan.com/validators#
These are validators, there are 21 of them (active)
To become a waldator, you need to collect votes for 58 million dollars in the BNB or buy them. Who owns the Binance Smart Chain (BSC)?
The best option is not to deal with similar coins.

Yes. Every consensus algorithm comes with its flaws. It's important to make a balance between decentralization and scalability in order to maintain the longevity of the underlying cryptocurrency. A hybrid approach will work best in this regard. By splitting consensus between miners and stakers, one could achieve fairness and a greater degree of decentralization. Holders could have a say in the consensus process too, by voting with their tokens on the Blockchain. Something like DPoS and PoW combined will do the trick. It's up to developers to adopt this solution in order to make crypto/Blockchain land a better place.

As I've said before, PoS is not the ideal path for decentralization and fairness. Most projects have gone through the PoS route for greater performance and energy efficiency. But they're really sacrificing the core values of crypto/Blockchain tech which are decentralization and censorship-resistance. It seems to me that Ethereum will become nothing more than a centralized banking system supported by big players on the industry. Binance, Coinbase, and other big exchanges will be able to control the future direction of the world's second-largest cryptocurrency by market cap. For us to make a difference, it's best to "stake" ETH on our own by meeting the minimum requirements to become a validator. I wouldn't advise anyone to lend their ETH on a staking pool, since it harms the decentralization of the Blockchain. As long as people stake on their own and don't keep their ETH on exchanges, everything will be fine. Who knows what the future holds for PoS as crypto becomes more popular in the mainstream world?



That's certainly true, mate. It has always been about greed more than the decentralization of the crypto/Blockchain space. While Bitcoin is the most decentralized cryptocurrency in the world, the fact that centralized exchanges dominate the market, greatly defeats the purpose of eliminating the middleman from the system. People don't care about decentralization as long as they're able to fill their pockets with money. Those who care about true decentralization are a very small minority. In the future, people will witness the negative effects of centralization as governments begin the crackdown on the entire industry. With a vast majority of centralized exchanges controlling the market, governments could easily destroy crypto as we know it. We need more decentralized solutions in order to make crypto censorship-resistant. As long as centralized exchanges dominate the crypto market, crypto/Blockchain tech won't be able to fulfill its true purpose in the mainstream world. Just my thoughts ;D