This may be true, but that does not mean that there is no merit at all to Proof-of-Stake. There are many people who believe that one-man-one-vote is not the best system, that instead, a system where the more educated or resourceful have a greater say is better.
PoS is suitable for shares in the company. It is also compatible with the idea that many PoS systems need to compete between each other to stay robust, while PoW allows competition within the system. We already have a money system in place owned by snake err... stakeholders, you know how it turned out. We are not yet at the hunger games scenario, but that's where any unchallenged PoS system is eventually headed. PoW is not one-man-one-vote, it is rather one-willing-to-compete-for-control-one-allowed-to-do-so
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Awesome thread is awesome! I liked the pics ![Smiley](https://bitcointalk.org/Smileys/default/smiley.gif)
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@jabo38 The beauty of PoW blockchain is that it is so simple! It also has an interesting property that players with the large amount of coins would likely be the ones who will compete in the mining arena the most to secure control of their stake in the system. If competition is strong enough major players will be doing it even at a loss. The choice major holders of coins will be facing is this: tax themselves by mining at a loss or let the competitors take control over their money. It's quite brilliant if you think of it. I haven't seen any other proof-of-x system that would have a built-in tax on the rich. All things considered, I don't think Satoshi's design was rushed or is somehow flawed. In fact, it has some interesting hidden aspects that will only start manifesting themselves in the long run. The actual configuration of mining space will of course depend on people's behavior. It might turn out quite peaceful and distributed or heavily concentrated and aggressive. What's certain though is that it will be changing over time as old players are leaving and new ones coming. I'm interested in other forms of consensus algorithm for blockchain, but simplicity and robustness of PoW will be hard to match. Things that concern me with PoI, that I haven't seen addressed anywhere, are related to long lasting network effects for control concentration. Very popular online services like Google, Facebook, Amazon might eventually gain so much importance in the system, that they will essentially become new central banks, and it's not that they will be getting richer that concerns me, but the fact that they will maintain most of the control over what gets into blockchain and what doesn't. The other problem is that blockchain doesn't have information on actual delivery of products. It means that real economic activity can be simulated within a large botnet and will be indistinguishable from honest players. The actual impact might not be significant though. All in all, there are many unknowns in the way this will be unfolding that's why I'm still curious about PoI. I wouldn't write off PoW as inferior or flawed in any way. It is very simple and very robust design that has passed the test of time and survived many attack vectors. It is now securing a market cap of $5 billion, something that other models can only dream of. This song reflects my sentiment the best: https://youtube.com/watch?v=x6LwYmVqzG0
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Honestly I think the incentive will be security.
If you want your money to be secure, by ensuring that the network is secure, then you'll set up a little ASIC to solo-hash somewhere in your home.
Because the little ASIC is essentially your bank.
Sure, it may be 100 watts and cost you X$ / year, but nothings ever free.
Time for someone to build the first solar powered all in one weatherproof wifi hashbox.
(sorry if this was mentioned in the above, TL;DR)
True enough. Mining will become the price of vigilance in the land of freedom. Some will be willing to pay more to be extra sure, others less, some wouldn't even bother. It's also important that 51% attack vector remains open. Yes, freedom can be attacked, that's how we know we have it.
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jbreher, don't even bother trying to debate with this younger generation of Europeans. They've been fully brained washed by the indoctrination over there. Watch Europe crash and burn. My popcorn is ready (but my anonymous coin not yet).
It's nice to be perceived young (to some degree I still am), thanks! ![Smiley](https://bitcointalk.org/Smileys/default/smiley.gif) I understand your frustration with the government, but the truth is simple - bigger stars need stronger confinement field, they often shine the brightest though. Anonymity might be a good way out for those feeling that the confinement field is about to crunch under its own weight, though a new type of fuel (Bitcoin) might give it a chance to rebalance and reevaluate the course it is headed.
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Governments, on the other hand, don't task people with anything, they only tax the gain,
Ha Hahaha Hahahahahahahahahahhahahah Perhaps it is so endemic that you don't even recognize it as such. Tax is one thing, what about the time you expend in filling out the interminable forms? That's not a task? Ever stand in line to get your drivers license renewed? Military conscription? ACA for any of you Americans? E-Verify? Shovel your walk within 24 hours of snowfall? Cut your weeds or answer to the council? Provide an authority approved mailbox, and don't use it for any other purpose? Send your kids to an authority approved school or be hauled in? Blow into this tube? Clear the sediment runoff out of this creek that runs across your land? Replace your toilets with low flow models? No transacting without the appropriate licenses? Are you freaking kidding me? Not all governments are the same. What I meant in the quote above is "on daily basis". Sure, you need to do things time to time to keep things in order. If you look up my dust-cloud comparison a few posts above, you will understand that two forces play against each other within a star. One is a gravitational confinement field (government) that keeps the star from falling apart, another is a termo-nuclear reaction (businesses) that generates energy and useful by products. If one or the other is too strong the star will either collapse in on itself or explode into outer space. We need both governments and businesses to turn our societies into nice and stable shining stars. Both parts of the equation need to have clear intentions, be transparent and accountable for their actions. Having an open public ledger seems to be the easiest way to achieve this.
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Unun,
Absolute freedom exists only in the way you choose to relate to things, but not in the realm of things themselves. You will always find a constraint if you want to, and you can always choose to not be happy about it, or on the contrary, choose to see how it can benefit you.
The way current governments seem evil is because they are not the top players, the banks are. What you're suggesting is a completely totalitarian utopia, because without governments big businesses will be taking their place. Big businesses will have private armies, they will own a lot of land, they will acquire media companies.
But as I mentioned in my previous post, all businesses are totalitarian in nature, people get orders from above, they get thrown out if they disobey. Competition will make sure that small companies join together to form bigger and bigger businesses to survive, until the market saturates and all the land and resources are privatized. Small individual entrepreneurs will have no chance of staying afloat, and will have no freedom whatsoever. They will either be bought out to bow under the same chain of command or thrown out of their land because some private armies will come knocking their door.
If that's what anonymous transactions is going to bring, I would rather stay away. It was nice talking to you, I have some stuff to attend, so I'm signing out for now.
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Unun,
I mostly agree with what you said. I'm not saying that current model, where governments borrow from banks and have to pay back with interest thus getting themselves deeper and deeper into the debt blackhole, is sustainable. It is not, it needs to change.
I think historically governments represent pieces of land occupied by different cultures. It is quite different from companies and businesses that can have offices and producing facilities in many different places. People in various companies have managers and receive tasks, they usually have no say in what the company is doing and the direction it is going with. Governments, on the other hand, don't task people with anything, they only tax the gain, keep things in order and make sure that companies don't fight each other for pieces of land that they need.
So, while anonymous transactions might be normal and workable for businesses, it conflicts with the idea of having a government. I know we have bad examples of governments and the word itself starts to have a negative connotation. But I'm not so sure that a world where companies and businesses are the top players is the place we want to live in.
Governments need to be stable and self-sustainable, businesses are volatile and profit-driven.
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Anyways, we haven't had an open system like Bitcoin before. Who knows, maybe it will turn things for the better. Maybe people will learn, maybe people will care. Let's give it a chance to play out the way it was created - open and free. In the mean time we can experiment with all the other stuff we can think of.
I agree with you that decentralization technology must improve matters, because empowering the individual always does improve prosperity. I don't think we will have decentralization without anonymity. That is why I remain diligent in my stance on this forum. It's an interesting topic and I'm only developing my opinion on it. Anonymity feels somewhat darkish and shadowy. If everything and everyone is anonymous, it is quite scary. Historically societies converged towards having a government instead of anarchy and anonymity. Maybe because government outlines a clear vision, a goal and a way to achieve it. It is a public service, and it needs to be open about everything including finances and spending. When people are open and transparent about their intentions it brings comfort and direction in life. People can only achieve great things if they work together. Building complex machines, space-shuttles, submarines would not be possible in a totally anonymous society where everyone is hiding in a shadow looking only to satisfy self-interest. I would compare anonymous society to a dust-cloud in outer space, where it remains cold and dark. Only when the dust in the cloud starts to coalesce, it forms clusters of gravity, which eventually give birth to stars. It is the stars that give light, heat and produce a whole ton of useful stuff.
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... Government provides the service of promising more than it can collect in taxes. And the people always love it. Again this is an IRON LAW of Political Economics. This can never change because it is human nature. Everybody loves something for nothing. And politicians are expert at telling them it is plausible. Since Mesopotamia humans have been falling for it. And they will be falling for it for eternity. The only escape is anonymity where the socialism can't extract its horrible nature from you. Putting every transaction on the block chain does nothing to stop the government from borrowing money. It does nothing to stop kickbacks from government transactions. Are you going to prevent every contractor's employee from using an anonymous coin? You see it becomes an enslavement for everyone, otherwise you can't stop the leakage and ways of gaming the system. The supply of Bitcoin will never be limited to 21 million coins unless you can find a way to outlaw finance and debt. But the people love debt and that is something that will never change. Usury was illegal and it coincided with a Dark Age. It was when the restriction of usury was removed that the Enlightenment and the economy began moving again. Because most people don't function on savings. Money is always power-law distributed, because most of humanity lives for today. Statists always think they can create a nirvana. They are so delusional. Edit: However I agree with you that there is one valid function of government. To resolve conflicts. If there is no authority with bigger guns, men fight to resolve who has the bigger gun. So here is where you vote with your feet. You withdraw your consent to that authority with anonymity when it is being abused, e.g. the USA military resource is being abused. If we look at a good half of Ukraine, we will see that a lot of people there wish they had a stable government. Things aren't pretty when they are out of balance. Anyways, we haven't had an open system like Bitcoin before. Who knows, maybe it will turn things for the better. Maybe people will learn, maybe people will care. Let's give it a chance to play out the way it was created - open and free. In the mean time we can experiment with all the other stuff we can think of.
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... I don't disagree, but it seems to me you missed at least one of my salient points. A paradigm is not open if it is the only way allowed. Such a goal is self-enslavement. Thus for sure there will exist anonymous block chains. So just forget being able to enforce that all corruption is 100% transparent always. There will never be a solution for that. And there shouldn't be because taking action against it, is centralizing. Politics is centralizing. Voting is centralizing. These all require a collective outcome.
Voting with our feet is decentralizing, because each person can act independently and gets his or her result instantly. As you vote by withholding your funding for the corruption (because you are anonymous you can), you contributed to minimizing it. Instantly. Decentrally.
When you agree with the efficiency of the government and see a necessary project, you agree to fund it. In order words, we privatize the government. They have to perform well. Similar to crowdfunding.
Thank you for prompting me and giving me the insight of how to clarify my point. We learn from each other, by sharing.
If requirement is such, that taxes (obligatory or voluntary) are collected on an open blockchain, then existence of other payment methods will not jeopardize the transparency of government's spending, as the exit points to any anonymized system will be clearly seen. I agree that open and closed systems should compete with each other, so that neither is abused. If there is too much taxes and they are wasted on things people don't need, then population will slowly move into a shadow economy. However the opposite is also true, if the shadow way of doing things doesn't bring much comfort and stability to society, people will be willing to fund a good government with their taxes to keep things in order. Current governments will be faced with a choice at some point: wether to keep accumulating debt in fiat or start adopting crypto, in which case a fierce competition for control over the crypto will make sure that people's opinions on how to proceed forward will need to be taken into account. Government would need to present a service that people will be willing to support.
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The government in general is not a problem, it is an obscure financial system currently in place that allows corruption on a large scale to go on unnoticed by the general public.
Keeping blockchain open and transparent will make government more accountable and democratic.
I've seen this advocated as a positive for Bitcoin many times. So my rebuttal is not targeted at you personally, but at the concept which you've ostensibly learned from others. This assumes crypto-currency will be the only currency or the public can force all government transactions on to the block chain, which I assert is irrational and delusional to the extreme. If ever you had only one way to transact, we'd be slaves in a 666 system (don't tell me that with decentralization we'd be free of the Law of Collective Political Economics, impossible...don't abuse yourself with notions of eliminating nature and achieving perfect nirvana). We can't even force the government to reveal all information about the NSA, so we surely can't force them to be open when they have other options for transacting. Also we already know about the government transactions in sufficient detail to know about the corruption, but we still can't vote them out of office. We the People lack the power in democracy is because of the Law of Collective Political Economics. The way crypto-currency will reform government is "voting by feet". When people have a way to walk away from the government edicts, e.g. confiscate and redistribute (ahem tax and spend), the government becomes impotent or at least the people have a finer grained veto on socialism because each person can make his or her financial weight counted in terms of what they agree to and not. ... Crypto-currency might not be the only way to transact for now, but the network effects will eventually make it one of the primary systems on the planet. Unlike unsustainable fiat's debt-spirals, current major PoW coins are all gain-spirals. It means that incentives are there for the replacement process to continue unhindered. Requirements for transparency and accountability can be gradually put in place while governments are slowly evolving and adapting to the new way of doing things. Governments are not some alien rogue entities that were enforced on people from outside, but rather it is people themselves who created governments to make society civilized and keep things in order. We need an outstanding example of an open transparent money system (which Bitcoin is first installment of) to compete with closed obscure and entrenched ones currently in place. There might be some demand for fully anonymous crypto, but I believe it will constitute a small niche. Remember what kind of outrage an opaque voting system caused in the recent Bitcoin Foundation elections? It's a shame, especially when blockchain technology allows for full accountability and transparency. Open is the way forward.
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I voted no (means Bitcoin is perfect as it is)
The government in general is not a problem, it is an obscure financial system currently in place that allows corruption on a large scale to go on unnoticed by the general public.
Keeping blockchain open and transparent will make government more accountable and democratic.
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... I'll take this one-sided discussion a bit further and say this: short of a "51%" attack, which there is a lot of FUD about, but realistically, even though it is theoretically possible to perform such an attack with much less than 50% of "hashing power," to make it practicable in the preventing all other blocks/transactions sense, it would take a lot more than 50% of "hashing power" or a lot of losses on a lot of attempts. The general argument here is that this isn't a realistic concern given that people don't tend to like to take on investments outside of spy movies where you have criminal masterminds with seemingly unlimited money to spend on crazy schemes to get even more money or take over the world.
ETA2: I have a negative view on society as a whole, and could definitely see counterarguments to this 51% argument considering the amount of money spent on lobbying to screw over consumers by large corporations (that can also be read as depositors by large banks), but that goes way outside the scope of your original question, to which the answer was a very simple "miners" and "for the fees".
Regarding 51% attack. It is utterly important to have such a possibility, as it is the only way for economy in general to take control over the system back from the rogue entity. If control cannot be challenged, there would be no competition for it. End of story. We can consider mining (in the long run) as an automatic built-in tax on the rich. You simply cannot sit on your money and watch how your competitors gain more and more share of control. At some point they will be in position to not allow transactions from your addresses and can tax you any way they wish. The assertion is that large amounts of money can be tracked on the blockchain and the whole thing remains quite transparent in the future, which I believe it should. It is possible that competition for control will be so strong that literally all participants will be doing it at a loss. This will keep everyone busy and bring balance to the world.
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As the block reward drops and the market cap rises, mining will become more of a competition for control than it is for profit today. It is a scheme where rich would need to compete with each other, possibly at a loss, in order to maintain a share of control, so that their accounts don't get frozen. This prevents rich getting richer without engaging in a fair competition with risks of losing.
Bitcoin separates money and control, so that competition for both is ensured and never stops. I believe forum's logo is not accidental, as it symbolizes the balance point between the two, and yes Bitcoin is a very simple machine.
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I've always liked the way this one makes it clear that consolidation in the mining industry was the plan from the beginning: I anticipate there will never be more than 100K nodes, probably less. It will reach an equilibrium where it's not worth it for more nodes to join in. The rest will be lightweight clients, which could be millions.
At equilibrium size, many nodes will be server farms with one or two network nodes that feed the rest of the farm over a LAN.
This one echos the same sentiment: The current system where every user is a network node is not the intended configuration for large scale. That would be like every Usenet user runs their own NNTP server. The design supports letting users just be users. The more burden it is to run a node, the fewer nodes there will be. Those few nodes will be big server farms. The rest will be client nodes that only do transactions and don't generate.
... Those are good ones. Should give people some idea about current state of affairs in mining. ... Now I want to ask something on that topic: Do you think that satoshi is just one person or it's a group of people? ah? ![Tongue](https://bitcointalk.org/Smileys/default/tongue.gif) Satoshi is a group... of one person ![Grin](https://bitcointalk.org/Smileys/default/grin.gif) There is only one of us here.
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As the recent PoW vs PoS discussion revealed, there are certain hidden aspects of consensus algorithms that might not be obvious to everyone, but have paramount importance in long-term survivability of the system in case where it becomes dominant on the planet and there is nowhere to run.
This is why it's important to keep competition between the systems ongoing instead of changing one system into another. This way all systems will behave and compete for participants.
I believe that moving this thread wasn't an act of censorship, but rather an invitation to experiment with various improvements and let them mature in the alt space.
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There is no centralization of mining, but rather a clusterization. It's natural and is a reflection of our society. We don't have a flat hierarchy of people on the planet, we have structures and sub-structures and those compete for control and resources. What's important though is that entry to the mining arena is free for everybody, though you need to be well-funded and/or well-skilled to have a good chance at staying afloat there.
I think "permission-less decentralized exchange for energy" is a very good description from the article for what mining really is, apart from the fact that it is also a competition for control. Bad actors are not completely ruled out, but at least they can be challenged and defeated if people care about their money at all. If they don't, they deserve what they get. Also be cautious who you entrust control over the network when you sell it for profit via certain derivative schemes.
PS: Technology cannot change society, but a good technology will serve as a perfect mirror and allow society to see its own reflection and take action to improve it.
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for the same reason there is still a 'simple machines forum' logo at the top right of the forum pages...
I can't believe this thread was moved to the alt section. This forum is unbelieveable.
yep. sign of bitcoin going stagnant. If you look at the forum logo, you will see that Bitcoin provides a balance point between money and control, as it allows competition for both to continue indefinitely. Rules of the game need to be stable and not change at a whim of those who don't feel competitive. You are free to create other rules and play other games though. Bitcoin is a Proof of World system. The World is a fundamentally neutral place, as it is just a mirror. If you don't like a reflection, you don't go and change the mirror, you change yourself.
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dinofelis has a valid argument, but some basic assumptions might be wrong.
First of all, ASIC producing capacity might become a limiting factor. Apple is often struggling with huge demand as they lock in deals with several fabs and still can't get enough chips. So thinking that you can consume all the power available on the market by simply plugging in more and more ASICs is somewhat unrealistic. Also keep in mind that highly advanced tech is initially a low-volume production as the process needs to mature.
Secondly, good money drives out bad money is a valid point in general, but reality might be such that the old money isn't that bad just yet and the new money isn't that good just yet. You see, the problem with fiat is that the debt spiral takes generations to have a substantial effect on economy, and people using fiat might not realize this within their lifetimes. As the old money is worsening, the good money will be improving. This might take some time, maybe a generation or two.
But I agree with that ! I'm just analyzing the consequences of certain hypotheses put forward. My personal opinion with what I learn here is that bitcoin may succeed, or not, that this is really a totally open question. And that if it is to succeed, that the evolution will be very slow and may take decades (which by itself is also problematic for another reason). I used to think that a next rally was due, from extrapolation of the past. But I'm realizing how different the situation is now as compared to the past. But I hear that most proponents of bitcoin seem to think something of the kind of "fast adoption in the coming decade". I don't think it is going to be possible, unless one means by fast adoption: fast adoption in a niche market, to stay there. That phase may then already be over: bitcoin may then already be mature and have acquired most of its niche. I have no strong opinion one way or another. I'm trying to find out, by discussing, analyzing, understanding, confronting my logical deductions with critique, in order to make the best possible decisions. The concrete result for the moment is that I'm cooling down on buying coins (for the moment I only put some money in it that I can afford so much to loose, that I even consider it to be lost even though it isn't - yet :-) ). I don't think that there is any hurry in fact, contrary to a few months ago when I got into it. If bitcoin by any accident succeeds, then I'll be happy to have those coins when I retire, a few decades from now. And if not, hey, I don't care much. But I don't think it would be wise to put money I could use for things now in it. Yep, keeping a cool head is a way to do business. Balance is the key!
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