Bitcoin Forum

POW:
- enormous power consumption
- bad distribution through big mining farms
- threat of 51% attack

POS:
- encourages hoarding, but not spending
- lots of scamming through lacking transparency in IPOs
- potentially bad distribution through IPOs

same for all:
- length of the blockchain

1. other problems?
2. any solutions?

Major*

 ;)

hehem .. yeah xD

The third big problem:

- What are they? Are they currencies, designed to be spent, or are they commodities/valuables, designed to increase in value?
The two contradict each other. If you think BTC is going to increase in value, it makes no economic sense to spend it, you would spend USD instead, and keep your BTC.
But the ultimate long term value of BTC is tied to it actually becoming used as a currency (or at least a medium of exchange), and so having actual use, rather than just speculative value.

You need to convince retailers to accept BTC, and for people to spend it, to increase its long term value.
But if you think its long term value will increase, you won't spend it.

the problem of pos (pure pos) is transparency, if they could find a way to spread the coin as much as possible without cheating it might have a bright future

theres just too many coins now. need to weed it out to 60-70

"becoming used as a currency" is quite a problem in the crypto world I find. But I think Bitcoin (and other POW currencies) handle that problem through a transaction fee that is almost nil. enormous advantage to fiat money!

POW transaction fees are usually higher, and proportional to what you spend.

I don't think thats such a big problem.
Better a million shitcoins, than a central banking system where i don't have any choice about my currency what so ever!

transparency definitly is a issue!
I think NEM is looking quite promising when it comes to the distribution question.

the major problem of proof of stake is that there's nothing at stake.

what do you mean?

IMHO, Peercoin has the best solutions to these problems; with a fair initial distribution through proof-of-work (mainly from the time period when mining was more accessible), and the small 1%/year PoS reward is not big enough to justify hoarding all of your coins. Anyways, I'm quite sure most holders of 100% PoW coins won't spend much of them before their value is multiplied. Deflation encourages hoarding, so the small inflation present in PoS coins offset the advantages of the small reward hoarding gives you.

Yeah I like the Peercoin concept as well!

:)
Also, a small transaction fee is mandatory, which means less dust-transactions spam, and thus a smaller blockchain. Peercoin's blockchain is still less than 300mb, and it's one of the oldest coins.

enormous power consumption
is it because you pay your electricity bill in fiat ?

i thought POS encourages selling coins?

With pow you have to mine any additional coin you want to sell. While in pow you can keep a certain number you want to hoard and keep selling the stake for value. I thought POS would create the ultimate selling obstacle. Is it proving to be the opposite?

I don't understand your point. How is selling coins mined through PoW different than selling coins obtained through PoS?

Its because the planet is already quite fucked up.

POS is easy to stake. while mining would be much harder down the road and not to mention expensive


take dogecoin for exmaple. can you mine it easy? if it were POS , you could buy 5 millions and sit there stake additional coins effortless.

Now everyone that owns coins are ultimately"mining" thus creating additional coins.

And negative aspects of mining includes not only the waste of electricity, but the quantity of electronic equipments that gets obsolete in less than a year.

Also, OP, you should consider adding the threat of 51% attack and mining centralization under PoW.

If that were the case, every dogecoin holders would do that, thus difficulty would be huge, so for 5 million doges you'd probably get like 50 doges/week. Selling pressure would not be worse than with mining.

very true & done!

mining: using your money to buy hardware & electricity, to generate more coins.
forging: using your money to buy coins, to generate more coins.

Had not thought of that before: PoS is quite good for the long-term valuation (better profit potential) of a currency, because those interested in it won't spend their money on electronic equipment, but on the coin itself. If all the money that had been spent mining bitcoins had been used to buy and stake the coin, its market cap would probably be in the tens of billions by now.

or it could be the opposite. which i am mentioning : )


imagine i have 5 million coins :

``````With POW level, if i sell any. i lose total coin amount. i no longer have 5 millions. i have to mine in POW to get the coins back to desired 5 millions. Or buy back.

``````With POS level , i can stake extra coins for basically free and sell those , while maintaining my desired 5 million quota.

 The ability to POSy creates anyone with POS stakes to sell pieces. while IN POw anyone who sells will most likely have to mine or buy back , therefore they will consider twice to sell any coins

I'm not sure about other coins, but Peercoin's PoS reward is only 1%/year; if every holder sold only that small percentage, the price could only increase, don't you agree? :)

Also, people who mine through PoW have electricity bills to pay and must pay for new equipments, so they have some good reasons to sell their coins.

it is clear that you are only discussing about peercoin and are trying hard to show POW is bad while POS is awesome.

but this is a general discussion and i would like to have all kinds of argument here and not a typical "my coin" is better plug.

i do not want to discuss why peercoin is good or bad. i want to discuss why POS and POW are good and bad

I do believe it was relevant, since it shows that there are ways to mix PoW and PoS to reduce the impacts of both of these systems potential shortcomings. And I simply tried to argue against your criticism of PoS.

Indeed it is a big problem that money is wasted for equipment instead of buying coins.
Because the difficulty of the best coins is really high there is mined a lot of shitcoins. After that the miners are spamming all the threads because they want to push the price to sell their shitcoins.
Because of that we have a forum full of bullshit spam. When a newbie comes to the forum he is bombed by false arguments.
Thats keeps shitcoins alive a little bit longer, but the money is burned into pockets of scammers and cloners.

---> 1. Money wasted for mining equipment
---> 2. fals information distributing through parts of the communitie leads to bif loses for newbies.

IMO both aspects are there, but in BTC the currency side prevails.
In contrast all the altcoins are much more commodity-like.

I think it is an important distinction, because some people object to altcoins
on the grounds that there can only be one currency, and they invoke network
effect to bolster up their argument.

And of course they are right (Sorry Hayek...), but their premise that bitcoin and
altcoins are competing for the same space is a mistake. Even when an altcoin
pretends to be the bitcoin-beater, it still functions much more like a commodity.

However there is a yet another aspect of cryptocurrency that is gradually emerging, which
has been called decentralised autonomous organization. The coins are like stocks in
publicly traded company, everybody who contributes work for the organization gets compensated.
Bitcoin has been losing the decentralisation over time, whereas the newer community-oriented
altcoins seem to me much more DAO-like in spirit.

Continuing on the DAO trajectory will hopefully move altcoins farther from the dump/pump-commodity-mentality
and obsession with technical innovation towards more refined forms of social innovativiness. When the newer
"2.0" chains (NXT, XCP, Ethereum etc) mature enough we may start perceiving around us a fertile ecosystem of DAOs
with BTC as the universal currency and lingua franca of all the coins.    

Distribution is by far the biggest issue I think.

I know there are already solutions to the enormous blockchain problem, like multibit's solution. The thing I don't like about the current solutions is they seem to be less secure than downloading the whole blockchain. I cannot find any other alternative that avoids massive downloads, but has the maximum security of blockchain downloading.