Bitcoin Forum
July 25, 2021, 12:59:24 AM *
News: Latest Bitcoin Core release: 0.21.1 [Torrent]
 
   Home   Help Search Login Register More  
Pages: [1] 2 3 4 5 6 7 »  All
  Print  
Author Topic: Incentivizing Bitcoin Nodes  (Read 15170 times)
RealBitcoin
Hero Member
*****
Offline Offline

Activity: 854
Merit: 1000


JAYCE DESIGNS - http://bit.ly/1tmgIwK


View Profile
July 02, 2016, 05:04:58 AM
Last edit: July 27, 2016, 05:51:08 PM by RealBitcoin
 #1

One flaw I find in bitcoin is the lack of incentivizing nodes.

The basic theory of bitcoin as I understand is like this: Miners are incentivized by fees + block reward to mine and thus establish the critical backbone of the network. Each miner must be a node, therefore there will be at least as many nodes as miners.

Now in a perfectly decentralized system, everyone would be a node and a miner,and there would be no issue. However in reality, mining is a specialized industry and it gets more specialized as the day goes by. And nodes have no incentive, so the network is really on the mercy of the good will of the people who voluntarly run a full node non-profit. This is definitely a problem.

Mining will become centralized that is inevitable, just as agriculture in the past 5000 years was practiced by 80% of the population, now it's only done by 1-2%, the same will happen with bitcoin mining. However bitcoin mining centralization is another topic, and the node count is even a bigger problem than that.

So the miners will be less and less even with the incentives. But what about the nodes? They have 0 incentive, so the problem here is even greater , and I fear that in the next years the node could will drastically shrink making the network very insecure.



-Merchants will hardly be nodes, they will just use a paid API given by a specialized hosting node service, that will be just like any major hosting provider.

-Individual users, wont even bother to run a full node, because the hardware requirement will be big, and they will just use lightweight or web wallets

-Miners will be nodes, but the question is how long until they develop a tech where they will use a centralized node hosting service and they will only supply the mining power to it.



So the conclusion is that nodes are a dying species, there is absolutely no incentive for people to be nodes, and it will slowly shrink and make bitcoin network very unsafe.



My proposal to incentivize nodes

Obviously messing around with the protocol is not a good idea, so we cant change the protocol to include the nodes in the reward system (as it should have been done 95-5% split with miners and nodes). However we can do it offchain, with sidechains, smart-contracts or other technology. The following ideas came into my mind ,and some of them might be implemented, or even all of them, if they are suitable. All implementations would be optional, so if a node doesn't want to participate, he can opt-out.

1) Donation pool for nodes

A donation pool for nodes can be implemented, and each node can participate in it, voluntarly. Whereas people can donate into a pool, and the pool automatically forwards every donation to each node's bitcoin address.

There would have to be a server or some kind of offchain solution to store the information, or some kind of smart contract system that executes the procedure  automatically and transparently.

So each node would receive a share of every donation, when somebody donates

You can get inspiration from the approach of the Electrum wallet , whereas each electrum server has a donation address and people can donate there, the same can be done with bitcoin nodes, but automatically.

2) For profit API system of nodes

A node could delegate his access to the network to clients, as in server->client relation. Each node is a server so clients who dont want to run a full node, but do want access to the bitcoin network, could do it in an API system that they would pay for.

So for example if Company A doesn't want to setup and maintain a bitcoin node, but wants to broadcast transactions securely direct to the network. They will pay a subscription fee to use the bitcoin nodes via an API system.

So the API system could connect the access to the bitcoin node directly with a client, they would pay for it, and the nodes would then provide access to their service.

However the catch is that the API access would be shared between all nodes, so the subscriber would not always connect 1 node, but to the node(s) closest to him or randomly, and the subscription fee would be equally distributed between all nodes proportional to their uptime %. This would ensure that all nodes get a piece of the pie, and would incentivize many people to just run a full node to earn some bitcoins.

And not just broadcasting, but getting statistics from the network and others. Imagine it just like the blockchain.info API system, but it would be for-profit and every node could do that.

This is also need to be done via some sort of smart contract or offchain solution, but i think it's doable.

Most nodes already limit the number of TX they allow, do prevent DDOS, so why not make broadcasting for profit and eliminate DDOS forever (because DDOS only happens when the access is free)

3) Altcoin financing bitcoin nodes

A POW inflationary altcoin can be created (BTCNODECOIN?), that will finance the nodes directly. It would inflate forever like dogecoin, and 50% of the mined coins would go directly as a donation to bitcoin nodes, to finance them. The other 50% would go to the altcoin miners just as usual. So the altcoin miners and nodes would share the reward, but the miners would do the work.

So investors that would invest in this would directly support all bitcoin nodes, and this way people could support nodes.

This is almost equivalent to 1) , however the altcoin approach instead of a donation pool is more self-sustainable. And the speculators + investors + donors is a better approach than just donors alone.

4) kushti's proposal

There are some consensus protocols adding rewards for full nodes to the Proof-of-Work, e.g. Proof-of-Activity by Bentov/Rosenfeld http://eprint.iacr.org/2014/452.pdf and a protocol of mine http://arxiv.org/abs/1603.07926 (working on the new version of the paper right now, it will be more formalized)



So these are my ideas to restore the nodes. All implementations would be optional, so if a node doesn't want to participate or risk their network to vulnerabilities, he can opt out. But new nodes could come into existance as they become incentivized.

Also I leave the technical part to developers and programmers to figure out, I just put out the idea , and the details can be discussed.

1627174764
Hero Member
*
Offline Offline

Posts: 1627174764

View Profile Personal Message (Offline)

Ignore
1627174764
Reply with quote  #2

1627174764
Report to moderator
1627174764
Hero Member
*
Offline Offline

Posts: 1627174764

View Profile Personal Message (Offline)

Ignore
1627174764
Reply with quote  #2

1627174764
Report to moderator
Advertised sites are not endorsed by the Bitcoin Forum. They may be unsafe, untrustworthy, or illegal in your jurisdiction. Advertise here.
1627174764
Hero Member
*
Offline Offline

Posts: 1627174764

View Profile Personal Message (Offline)

Ignore
1627174764
Reply with quote  #2

1627174764
Report to moderator
1627174764
Hero Member
*
Offline Offline

Posts: 1627174764

View Profile Personal Message (Offline)

Ignore
1627174764
Reply with quote  #2

1627174764
Report to moderator
1627174764
Hero Member
*
Offline Offline

Posts: 1627174764

View Profile Personal Message (Offline)

Ignore
1627174764
Reply with quote  #2

1627174764
Report to moderator
belcher
Sr. Member
****
Offline Offline

Activity: 261
Merit: 329


View Profile
July 04, 2016, 04:46:22 PM
 #2

https://en.bitcoin.it/wiki/Clearing_Up_Misconceptions_About_Full_Nodes#Myth:_There_is_no_incentive_to_run_nodes.2C_the_network_relies_on_altruism

1HZBd22eQLgbwxjwbCtSjhoPFWxQg8rBd9
JoinMarket - CoinJoin that people will actually use.
PGP fingerprint: 0A8B 038F 5E10 CC27 89BF CFFF EF73 4EA6 77F3 1129
RealBitcoin
Hero Member
*****
Offline Offline

Activity: 854
Merit: 1000


JAYCE DESIGNS - http://bit.ly/1tmgIwK


View Profile
July 04, 2016, 05:16:56 PM
 #3


Thats not much. I doubt more than 1-2% of bitcoin users care about those 3 points.

98% of bitcoin users however rely on convenience, comfort , and ease of access. Therefore from the perspective of 98% of users, they do not have incentive.

The only real and effective incentive is financial incentive.

Barnabe
Hero Member
*****
Offline Offline

Activity: 616
Merit: 502


★Bitvest.io★ Play Plinko or Invest!


View Profile
July 04, 2016, 08:16:41 PM
 #4

I agree, there should be some kind of financial incentive for node owners. Maybe 1% of fees should be given to nodes ?
But since this is not an actual problem, I really doubt anything will be done about it. In the future maybe, when nodes are rare.



.
.BIG WINNER!.
[15.00000000 BTC]


▄████████████████████▄
██████████████████████
██████████▀▀██████████
█████████░░░░█████████
██████████▄▄██████████
███████▀▀████▀▀███████
██████░░░░██░░░░██████
███████▄▄████▄▄███████
████▀▀████▀▀████▀▀████
███░░░░██░░░░██░░░░███
████▄▄████▄▄████▄▄████
██████████████████████

▀████████████████████▀
▄████████████████████▄
██████████████████████
█████▀▀█▀▀▀▀▀▀██▀▀████
█████░░░░░░░░░░░░░████
█████░░░░░░░░░░░░▄████
█████░░▄███▄░░░░██████
█████▄▄███▀░░░░▄██████
█████████░░░░░░███████
████████░░░░░░░███████
███████░░░░░░░░███████
███████▄▄▄▄▄▄▄▄███████

██████████████████████
▀████████████████████▀
▄████████████████████▄
███████████████▀▀▀▀▀▀▀
███████████▀▀▄▄█░░░░░█
█████████▀░░█████░░░░█
███████▀░░░░░████▀░░░▀
██████░░░░░░░░▀▄▄█████
█████░▄░░░░░▄██████▀▀█
████░████▄░███████░░░░
███░█████░█████████░░█
███░░░▀█░██████████░░█
███░░░░░░████▀▀██▀░░░░
███░░░░░░███░░░░░░░░░░

██░▄▄▄▄░████▄▄██▄░░░░
████████████▀▀▀▀▀▀▀██
█████████████░█▀▀▀█░███
██████████▀▀░█▀░░░▀█░▀▀
███████▀░▄▄█░█░░░░░█░█▄
████▀░▄▄████░▀█░░░█▀░██
███░▄████▀▀░▄░▀█░█▀░▄░▀
█▀░███▀▀▀░░███░▀█▀░███░
▀░███▀░░░░░████▄░▄████░
░███▀░░░░░░░█████████░░
░███░░░░░░░░░███████░░░
███▀░██░░░░░░▀░▄▄▄░▀░░░
███░██████▄▄░▄█████▄░▄▄

██░████████░███████░█
▄████████████████████▄
████████▀▀░░░▀▀███████
███▀▀░░░░░▄▄▄░░░░▀▀▀██
██░▀▀▄▄░░░▀▀▀░░░▄▄▀▀██
██░▄▄░░▀▀▄▄░▄▄▀▀░░░░██
██░▀▀░░░░░░█░░░░░██░██
██░░░▄▄░░░░█░██░░░░░██
██░░░▀▀░░░░█░░░░░░░░██
██░░░░░▄▄░░█░░░░░██░██
██▄░░░░▀▀░░█░██░░░░░██
█████▄▄░░░░█░░░░▄▄████
█████████▄▄█▄▄████████

▀████████████████████▀




Rainbot
Daily Quests
Faucet
belcher
Sr. Member
****
Offline Offline

Activity: 261
Merit: 329


View Profile
July 05, 2016, 09:34:36 AM
 #5


Thats not much. I doubt more than 1-2% of bitcoin users care about those 3 points.

98% of bitcoin users however rely on convenience, comfort , and ease of access. Therefore from the perspective of 98% of users, they do not have incentive.

The only real and effective incentive is financial incentive.


I disagree, I think almost all bitcoin users care about privacy. I think you also just invented those percentages right now.

With fees going to nodes, all you do is incentivize sybil attacks.

1HZBd22eQLgbwxjwbCtSjhoPFWxQg8rBd9
JoinMarket - CoinJoin that people will actually use.
PGP fingerprint: 0A8B 038F 5E10 CC27 89BF CFFF EF73 4EA6 77F3 1129
RealBitcoin
Hero Member
*****
Offline Offline

Activity: 854
Merit: 1000


JAYCE DESIGNS - http://bit.ly/1tmgIwK


View Profile
July 05, 2016, 09:39:05 AM
 #6


Thats not much. I doubt more than 1-2% of bitcoin users care about those 3 points.

98% of bitcoin users however rely on convenience, comfort , and ease of access. Therefore from the perspective of 98% of users, they do not have incentive.

The only real and effective incentive is financial incentive.


I disagree, I think almost all bitcoin users care about privacy. I think you also just invented those percentages right now.

With fees going to nodes, all you do is incentivize sybil attacks.

Yes the percentages are invented, but look how bitcoin becomes mainstream.

First the tech guys joined, then the speculators, and now it's full of trendy people who dont give a shit about bitcoin, they just want to gamble or buy videogames with it.

Bitcoin's demographics is getting diluted as it gets mainstream. Do you seriously think that 100% of bitcoin users are loyal to bitcoin? Or care about bitcoin's long term? So the 1% is really as close as it gets.

For the 10 million bitcoin users you have only 5668 nodes, there is your proof how much the people care about bitcoin.

Most of them cant even backup a wallet normally.



So you need incentive to get more nodes, altruism can only provide 5668 nodes.

belcher
Sr. Member
****
Offline Offline

Activity: 261
Merit: 329


View Profile
July 05, 2016, 10:22:39 AM
 #7

Likely closer to 30k full nodes but ok. https://en.bitcoin.it/wiki/Clearing_Up_Misconceptions_About_Full_Nodes#Myth:_There_are_only_about_5500_full_nodes_worldwide

As long as the majority of the liquidity and investment capacity uses full nodes, we'll be okay. Kids buying $10 in bitcoin to spend on steam games don't matter much in terms of miners trying to print infinite bitcoins.

Giving money to anyone running a node with an open port will incentivize sybil attacks, that's a serious problem with your proposal you haven't dealt with. It will be hard to convince people to give money to something that has this problem.

1HZBd22eQLgbwxjwbCtSjhoPFWxQg8rBd9
JoinMarket - CoinJoin that people will actually use.
PGP fingerprint: 0A8B 038F 5E10 CC27 89BF CFFF EF73 4EA6 77F3 1129
RealBitcoin
Hero Member
*****
Offline Offline

Activity: 854
Merit: 1000


JAYCE DESIGNS - http://bit.ly/1tmgIwK


View Profile
July 05, 2016, 12:28:38 PM
 #8


Giving money to anyone running a node with an open port will incentivize sybil attacks, that's a serious problem with your proposal you haven't dealt with. It will be hard to convince people to give money to something that has this problem.

No, sybil attacks can happen regardless. If an enemy wants to destroy bitcoin , they buy up a bunch of VPS and do the sybil attack.

If you give money to strangers, obviously multiple people, who dont know eachother, they will start hosting nodes.

If the proposal is implemented well, to limit the profit to 1 IP/ 24hours, or some other limitation, then they wont spam the network up with nodes.

However those people that dont host nodes currently, will start doing it.

belcher
Sr. Member
****
Offline Offline

Activity: 261
Merit: 329


View Profile
July 05, 2016, 01:57:01 PM
 #9

What's the point? Say if one person rents lots of hosting on many different subsets, then they use an SPV wallet for their actual bitcoin usage.

Their nodes with open ports on rented hardware will do nothing to stop miners printing infinite bitcoins. The miners would just transfer their coins to an SPV wallet user and get goods and services in return.

The real problem is economically-active wallets not being backed by full nodes. Nodes on rented hardware that nobody uses as a wallet do nothing to remedy that.

1HZBd22eQLgbwxjwbCtSjhoPFWxQg8rBd9
JoinMarket - CoinJoin that people will actually use.
PGP fingerprint: 0A8B 038F 5E10 CC27 89BF CFFF EF73 4EA6 77F3 1129
RealBitcoin
Hero Member
*****
Offline Offline

Activity: 854
Merit: 1000


JAYCE DESIGNS - http://bit.ly/1tmgIwK


View Profile
July 05, 2016, 02:35:19 PM
 #10

What's the point? Say if one person rents lots of hosting on many different subsets, then they use an SPV wallet for their actual bitcoin usage.

Their nodes with open ports on rented hardware will do nothing to stop miners printing infinite bitcoins. The miners would just transfer their coins to an SPV wallet user and get goods and services in return.

The real problem is economically-active wallets not being backed by full nodes. Nodes on rented hardware that nobody uses as a wallet do nothing to remedy that.

What do you mean by stopping miners to print infinute bitcoins? You need a hardfork for that with 95%+ consensus. And that is mining.

I am talking about nodes, which may be controlled by miners, but may be not.

There are more bitcoin users than miners, and more individual nodes can be setup by honest people than by miners. So i dont understand how can the miners control all nodes in your scenario?

belcher
Sr. Member
****
Offline Offline

Activity: 261
Merit: 329


View Profile
July 06, 2016, 10:51:28 AM
 #11


What do you mean by stopping miners to print infinute bitcoins? You need a hardfork for that with 95%+ consensus. And that is mining.


SPV wallets like Android Bitcoin Wallet or Multibit have a looser security model than full nodes. They don't fully verify the blockchain so they completely trust the miners. Which means if the miners print infinite bitcoins these wallets will happily accept them.

The reason it doesn't happen today is that much of the bitcoin economy is actually backed by full nodes, so if miners did create invalid blocks they would find it hard to find anybody to sell them to.

Read this post https://www.reddit.com/r/BitcoinBeginners/comments/3eq3y7/full_node_question/ctk4lnd

95% miner signaling is for soft forks, which are unrelated to this.

1HZBd22eQLgbwxjwbCtSjhoPFWxQg8rBd9
JoinMarket - CoinJoin that people will actually use.
PGP fingerprint: 0A8B 038F 5E10 CC27 89BF CFFF EF73 4EA6 77F3 1129
ImHash
Hero Member
*****
Offline Offline

Activity: 910
Merit: 506


View Profile
July 06, 2016, 11:03:31 AM
 #12

Maybe miners and nodes could vote to use half the satoshi's coins to provide long term nodes system for bitcoin?

I think he(they) can survive with the other half imao.
RealBitcoin
Hero Member
*****
Offline Offline

Activity: 854
Merit: 1000


JAYCE DESIGNS - http://bit.ly/1tmgIwK


View Profile
July 06, 2016, 12:44:20 PM
 #13


What do you mean by stopping miners to print infinute bitcoins? You need a hardfork for that with 95%+ consensus. And that is mining.


SPV wallets like Android Bitcoin Wallet or Multibit have a looser security model than full nodes. They don't fully verify the blockchain so they completely trust the miners. Which means if the miners print infinite bitcoins these wallets will happily accept them.

The reason it doesn't happen today is that much of the bitcoin economy is actually backed by full nodes, so if miners did create invalid blocks they would find it hard to find anybody to sell them to.

Read this post https://www.reddit.com/r/BitcoinBeginners/comments/3eq3y7/full_node_question/ctk4lnd

95% miner signaling is for soft forks, which are unrelated to this.

Interesting I didnt know that, that gives me some things to think about.

What about the ELECTRUM wallet model? They have an electrum server, which must be connected to their self hosted node, therefore 1 electrum server= 1 bitcoin node.

https://github.com/spesmilo/electrum-server

So it is just like connecting to a bitcoin node, but through a 3rd party. You still have to trust the servers, but to my understanding, it connects to multiple ones to fetch the data ,so the probability of sybil attacks there is almost the same.

What's your take on that?

belcher
Sr. Member
****
Offline Offline

Activity: 261
Merit: 329


View Profile
July 06, 2016, 04:52:07 PM
 #14

Electrum servers are full nodes, Electrum wallets download the block headers and verify them. So Electrum wallets also completely trust the miners and whichever server they connect to.

Also Electrum wallets send all their addresses to the server, so an Electrum server can spy on everyone who connects to it.

1HZBd22eQLgbwxjwbCtSjhoPFWxQg8rBd9
JoinMarket - CoinJoin that people will actually use.
PGP fingerprint: 0A8B 038F 5E10 CC27 89BF CFFF EF73 4EA6 77F3 1129
Syke
Legendary
*
Offline Offline

Activity: 3696
Merit: 1078


View Profile
July 06, 2016, 05:11:46 PM
 #15

We'd need a way to verify that these full nodes are really full nodes to be rewarded. We should find some way of having a full node perform some work to prove they're not just a fake node. Maybe they could perform some sort of mathematical computations to prove they're real. And then when they find the right solution to this mathematical problem, we reward them with, say, 25 bitcoins. I think this would work. People would love such a reward and so they will run lots of full nodes!

Buy & Hold
RealBitcoin
Hero Member
*****
Offline Offline

Activity: 854
Merit: 1000


JAYCE DESIGNS - http://bit.ly/1tmgIwK


View Profile
July 06, 2016, 08:26:09 PM
 #16

Electrum servers are full nodes, Electrum wallets download the block headers and verify them. So Electrum wallets also completely trust the miners and whichever server they connect to.

Also Electrum wallets send all their addresses to the server, so an Electrum server can spy on everyone who connects to it.

How so? If the electrum servers are nodes, then the wallet only needs to trust the servers, because the servers are already verifying if the blockchain is good or not.

However trusting the electrum servers is easy, just restart the client a couple of times and you get a new RANDOM server each time. If the TX data is the same every time, then it proves that the blockchain you are on is genuine.


RealBitcoin
Hero Member
*****
Offline Offline

Activity: 854
Merit: 1000


JAYCE DESIGNS - http://bit.ly/1tmgIwK


View Profile
July 06, 2016, 08:27:45 PM
 #17

Maybe miners and nodes could vote to use half the satoshi's coins to provide long term nodes system for bitcoin?

I think he(they) can survive with the other half imao.

sorry but that is a terrible idea, protocol changes should not happen

We'd need a way to verify that these full nodes are really full nodes to be rewarded. We should find some way of having a full node perform some work to prove they're not just a fake node. Maybe they could perform some sort of mathematical computations to prove they're real. And then when they find the right solution to this mathematical problem, we reward them with, say, 25 bitcoins. I think this would work. People would love such a reward and so they will run lots of full nodes!

I just leave that to the devs, they know more about nodes and how to identify them on the network. I`m just putting out my thoughts.

DumbFruit
Sr. Member
****
Offline Offline

Activity: 433
Merit: 253


View Profile
July 06, 2016, 08:33:03 PM
 #18

It's not nodes that need to be incentivized, that's really easy to do. It's also not latency we're looking for either. What we really want is a way to decentrally, and trustlessly, prove that nodes are geographically distant (as a proxy for node anarchy), and incentivize it. It's pretty easy to prove that any two nodes are closer than or equal to a certain distance, but I don't see how to do any better than that.
We could have 3 trusted centers, which would triangulate a node and mining rewards could then be adjusted based on how geographically separated they are, but that's neither trustless nor decentralized.

Like I've said before that seems like a paradox in Bitcoin. We want Work that is nontrivial, to prevent attacks, while also wanting nodes to be trivial to start and operate, to prevent other sorts of attacks. Seems to me as long as mining is profitable it will always struggle toward centralization, and Work minimization, which is always economically optimal. The only way for Bitcoin to remain secure is by being economically unoptimal, which would require charitable node operation, which has become more and more unfeasible as operation has gotten more expensive and tedious.

I expect we'll see even more centralization when we hit the next reward halving, which isn't exactly prescient, that's been the norm. Unless someone can find a clever way to incentivize node distance (node anarchy), which seems like a pretty hard problem, or we start pouring wine on the ground for the Bitcoin gods, we're going to see the slow death of Bitcoin as a decentralized trustless currency, though it may survive as some other sort of abomination.

By their (dumb) fruits shall ye know them indeed...
RealBitcoin
Hero Member
*****
Offline Offline

Activity: 854
Merit: 1000


JAYCE DESIGNS - http://bit.ly/1tmgIwK


View Profile
July 06, 2016, 08:44:20 PM
 #19

It's not nodes that need to be incentivized, that's really easy to do. It's also not latency we're looking for either. What we really want is a way to decentrally, and trustlessly, prove that nodes are geographically distant (as a proxy for node anarchy), and incentivize it. It's pretty easy to prove that any two nodes are closer than or equal to a certain distance, but I don't see how to do any better than that.
We could have 3 trusted centers, which would triangulate a node and mining rewards could then be adjusted based on how geographically separated they are, but that's neither trustless nor decentralized.

The count of nodes matters too, because it decreases the probability of hostile nodes and the concentration of them. If there are 100 hostile nodes, and you add 100 honest nodes, then their power gets diluted.

And yes the political (not geographic) distribution counts as well. The political distribution is what matters. If there is 1 node in north Brazil and 1 in south Brazil that is still worth like 1. But if there is 1 in Iceland and 1 in Brazil that is much better.

Probably looking at thei IP/country should show you how politically distributed nodes are.


Like I've said before that seems like a paradox in Bitcoin. We want Work that is nontrivial, to prevent attacks, while also wanting nodes to be trivial to start and operate, to prevent other sorts of attacks. Seems to me as long as mining is profitable it will always struggle toward centralization, and Work minimization, which is always economically optimal. The only way for Bitcoin to remain secure is by being economically unoptimal, which would require charitable node operation, which has become more and more unfeasible as operation has gotten more expensive and tedious.

I expect we'll see even more centralization when we hit the next reward halving, which isn't exactly prescient, that's been the norm. Unless someone can find a clever way to incentivize node distance (node anarchy), which seems like a pretty hard problem, or we start pouring wine on the ground for the Bitcoin gods, we're going to see the slow death of Bitcoin as a decentralized trustless currency, though it may survive as some other sort of abomination.

Of course centralization is inevitable to some degree, but we should still try to slow it down as much as possible until we can reach market equilibrium.

If the demand of security and decentralization remains high, then the centralization will only go as far and reach market equilibrium.

TransaDox
Full Member
***
Offline Offline

Activity: 219
Merit: 101


View Profile
July 07, 2016, 07:12:01 AM
 #20

Like I've said before that seems like a paradox in Bitcoin. We want Work that is nontrivial, to prevent attacks, while also wanting nodes to be trivial to start and operate, to prevent other sorts of attacks. Seems to me as long as mining is profitable it will always struggle toward centralization, and Work minimization, which is always economically optimal. The only way for Bitcoin to remain secure is by being economically unoptimal, which would require charitable node operation, which has become more and more unfeasible as operation has gotten more expensive and tedious.

I expect we'll see even more centralization when we hit the next reward halving, which isn't exactly prescient, that's been the norm. Unless someone can find a clever way to incentivize node distance (node anarchy), which seems like a pretty hard problem, or we start pouring wine on the ground for the Bitcoin gods, we're going to see the slow death of Bitcoin as a decentralized trustless currency, though it may survive as some other sort of abomination.

Zero transaction fees would make it unprofitable when most of the coins have been found and you can say "so long and thanks for all the fish" to the farms. You just need to convince the devs to remove the fees.
Pages: [1] 2 3 4 5 6 7 »  All
  Print  
 
Jump to:  

Powered by MySQL Powered by PHP Powered by SMF 1.1.19 | SMF © 2006-2009, Simple Machines Valid XHTML 1.0! Valid CSS!