Who needs Satoshi Nakamoto principles?

[Thekool1s]

It's not miners who are driving fees up. They have strong incentive to fill blocks as much as possible. Due to limited block space, fees will always rise as transaction volume increases.

Well, that's one way to put it but the reality is the pools do decide which TX goes through and which doesn't, Just look at how many Transaction Accelerators exist already today. They are essentially acting as "Banks" if you are willing to pay "Top dollar" your transaction gets through within minutes. It isn't far-fetching that these pools can decide not to accept transactions below X amount of fees once the mining reward goes down... There is nothing stopping miners to extort fees if they want...

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[flamehowk]

Ring Bit Function. 1 part.
https://www.youtube.com/watch?v=yg-G6itsHpU&feature=youtu.be
An explanation of the new POW algorithm, which I call the Ring Bit Function (RBF), with C ++ code examples.

[squatter]

It's not miners who are driving fees up. They have strong incentive to fill blocks as much as possible. Due to limited block space, fees will always rise as transaction volume increases.

It's users employing horrible fee estimation -- including exchanges like Bitmex -- that drives fees up so much. Lots of exchanges weren't batching transactions in 2017 (and still aren't), which greatly exacerbated the congestion.

In theory in more decentralized mining you could increase the chance of a tx with small or no fees to be mined at some point, either because some miners dont have the same txs, or because they dont sort the memory pool on tx fees, because they are not mining 100% for maximizing profits etc

I'm not sure that's a function of mining centralization. I think it has more to do with how capital-intensive mining is, which in turn is a function of market demand for bitcoins.

The extreme example is when Bitcoin was CPU-minable and the mining costs were almost imperceptible. Profitability is not a concern when sunk costs barely exist. That dynamic drastically changes when it costs thousands of dollars just to buy a single miner, not to mention the other overheads involved. Naturally, hobby miners get forced out of the market, and a purely profit-motivated industry emerges.

[figmentofmyass]

It's not miners who are driving fees up. They have strong incentive to fill blocks as much as possible. Due to limited block space, fees will always rise as transaction volume increases.

Well, that's one way to put it but the reality is the pools do decide which TX goes through and which doesn't, Just look at how many Transaction Accelerators exist already today. They are essentially acting as "Banks" if you are willing to pay "Top dollar" your transaction gets through within minutes. It isn't far-fetching that these pools can decide not to accept transactions below X amount of fees once the mining reward goes down... There is nothing stopping miners to extort fees if they want...

like any business would, miners are maximizing their revenue and profit. that's why they are miners at all---to make money. we shouldn't blame them for that. bitcoin was intentionally designed to leverage this greed to prevent censorship and interference by 3rd parties. we pay miners to mine our transactions.

in turn, users compete with one another to get their transactions confirmed. when more and more people are racing to get confirmed in the next block, they start bidding higher and higher fees.

can you blame the miners for taking them?

if they really wanted to extort higher fees, they would implement fee minimums and soft limits on block size. instead, they consistently mine full blocks, including 1 sat/byte transactions.

[IadixDev]

It's not miners who are driving fees up. They have strong incentive to fill blocks as much as possible. Due to limited block space, fees will always rise as transaction volume increases.

It's users employing horrible fee estimation -- including exchanges like Bitmex -- that drives fees up so much. Lots of exchanges weren't batching transactions in 2017 (and still aren't), which greatly exacerbated the congestion.

In theory in more decentralized mining you could increase the chance of a tx with small or no fees to be mined at some point, either because some miners dont have the same txs, or because they dont sort the memory pool on tx fees, because they are not mining 100% for maximizing profits etc

I'm not sure that's a function of mining centralization. I think it has more to do with how capital-intensive mining is, which in turn is a function of market demand for bitcoins.

The extreme example is when Bitcoin was CPU-minable and the mining costs were almost imperceptible. Profitability is not a concern when sunk costs barely exist. That dynamic drastically changes when it costs thousands of dollars just to buy a single miner, not to mention the other overheads involved. Naturally, hobby miners get forced out of the market, and a purely profit-motivated industry emerges.

For me its the product of total hash rate skyrocketting, above the level of what the total hash rate of the users of the network would be, which is only possible due to centralisation of the mining power.

The thing is the mining cost for those who have the specialised hardware is probably very low, so its not like the mining really is more expansive in the absolute, its expansive on general purpose hardware.

[cryp24x]

Whatever is better and whatever is beneficial to all, I think that is what we need to do. Satoshi Nakamoto's principle is good but it is a fact that it is not perfect. If we can come up with something that somehow still have the original idea but enhanced and improved, I am sure that it will be a better one.

[Thekool1s]

@figmentofmyass That's really a skewed way to put it. Miners can't solo mine, that's a fact. In the current environment, Miners are being forced to work in the pools. I would rather question why no one has challenged this "pool" concept so far. It's the 1st step towards centralization iyam. Once these people form alliances what I have stated before becomes a reality. These pools can/already dictate which TXs go through and which don't. That is too much power for something which is technically decentralized...

As for filling the blocks that's not really a strong argument. Once the chunk of miner's earning is coming from the Fees there is literally nothing stopping them to only include transactions which they want. Consider this in the future. Let's say Coinbase becomes "huge" in the future and they make a "deal" with these pools that they will only include Coinbase's TXs into the blocks they form and will reject any other TXs. It leads to further Centralization of Bitcoin, what's currently stopping this to happen? As far as I know, there is no mechanism in place which will prevent this from happening...

[squatter]

Miners can't solo mine, that's a fact. In the current environment, Miners are being forced to work in the pools. I would rather question why no one has challenged this "pool" concept so far. It's the 1st step towards centralization iyam.

I think you've pointed out why -- because solo mining is untenable for most miners. Not all, but most.

P2Pool emerged as a way to challenge mining centralization by allowing for hash pooling without centralized payouts. It never caught on for multiple reasons covered here:
https://bitcointalk.org/index.php?topic=921093.msg10118511#msg10118511
https://bitcointalk.org/index.php?topic=921093.msg10126962#msg10126962

These pools can/already dictate which TXs go through and which don't. That is too much power for something which is technically decentralized...

In practice, pools operate as expected. They order transactions based on fee rate. That's exactly how Bitcoin was designed -- with transaction revenue rising to replace the mining subsidy as incentive for honest mining. I don't see the problem here.

Miners have always had the power to decide which transactions get confirmed. It's not just pools.

As for filling the blocks that's not really a strong argument. Once the chunk of miner's earning is coming from the Fees there is literally nothing stopping them to only include transactions which they want.

There was never anything stopping them from doing that.

Consider this in the future. Let's say Coinbase becomes "huge" in the future and they make a "deal" with these pools that they will only include Coinbase's TXs into the blocks they form and will reject any other TXs.

That seems unlikely. Coinbase doesn't want to pay more than the market demands, and mining pools don't want to give up fee revenue if they don't have to.

Anyway, miners should include whatever transactions they want. That's how the protocol works.

[flamehowk]

Ring Bit Function. 2 part.
https://www.youtube.com/watch?v=Ir9Ptfg0Nbg&feature=youtu.be
In this part we make a chain of RBF rings.

I'm not sure that's a function of mining centralization. I think it has more to do with how capital-intensive mining is, which in turn is a function of market demand for bitcoins.
The extreme example is when Bitcoin was CPU-minable and the mining costs were almost imperceptible. Profitability is not a concern when sunk costs barely exist. That dynamic drastically changes when it costs thousands of dollars just to buy a single miner, not to mention the other overheads involved. Naturally, hobby miners get forced out of the market, and a purely profit-motivated industry emerges.

like any business would, miners are maximizing their revenue and profit. that's why they are miners at all---to make money. we shouldn't blame them for that. bitcoin was intentionally designed to leverage this greed to prevent censorship and interference by 3rd parties. we pay miners to mine our transactions.
in turn, users compete with one another to get their transactions confirmed. when more and more people are racing to get confirmed in the next block, they start bidding higher and higher fees.
can you blame the miners for taking them?
if they really wanted to extort higher fees, they would implement fee minimums and soft limits on block size. instead, they consistently mine full blocks, including 1 sat/byte transactions.

The point is not how motivated the mining industry is. It is also not a matter of how much the miner bears the costs in order to start mining coins. Many of you miss the most important understanding that mining in modern Bitcoin is precisely the extraction of coins. But in conceptual Bitcoin, mining is EMISSION technology. Do you understand what emission is? Why is it needed? By what rules should it be conducted?
That is the whole point.

As far as I know, there is no mechanism in place which will prevent this from happening...

Has already! I developed it. It remains only to implement in cryptocurrencies.

There's a possibility to have a better one or the bitcoin develop itself to be a decentralized asset again.
There's no perfect here and all of those principles can be voided too, that's the sad reality in this world, nothing is permanent and thing can be replaced quickly.
I don't think people will preserve those principles if they're now gaining too much profit in their own ways. It's kinda unfair for us who managed to learn and appreciate those works of satoshi since we really adopt its purpose.

We can make a reasonable move. We can restart Bitcoin from scratch. For all. As it was with Monero. But already with my POW algorithm. And after some time it will be possible to see how much ASIC farmers will earn ... When all the users who fill it with real money leave the centralized Bitcoin, ASIC farmers will immediately understand the real value of this idea. Then no one will keep users on a short leash ... and Satoshi will be able to sleep peacefully ...
What do you think about this?

[100action]

"Proof-of-work is essentially one-CPU-one-vote."
Satoshi nakamoto




As we all know, mining is now completely centralized. Big money buys expensive equipment in the form of ASIC / GPU / FPGA devices and deprives everyone else of the right to participate in the issue of cryptocurrencies.

Questions:

Does the modern cryptocurrency community need this principle of Satoshi Nakamoto?

Maybe it's time to abandon it and admit that ONLY money should always release new money?

No they don't need all of Satoshi's principles, his system isn't perfect, no system is. Bitcoin wasn't designed to last forever, it was a proof of concept for Blockchain, and an alternative financial system to traditional banking, why do you think the entire project is open source?
 It's open source so that others can build upon or off Blockchain and Bitcoin protocol, to enhance it and add to it, making it better. Bitcoin is only the prototype protocol. There are better Blockchains and cryptocurrencies on the market.

No there isnt.

Name one.

[flamehowk]

OK. I suggest restarting Bitcoin with the CPU_ONLY POW algorithm.



What do you think - what name should we give to him?

My options are:
New Bitcoin
ReStrart Bitcoin
Bitcoin RS (from ReStart)
Bitcoin 2020 (date to start since)
Bitcoin FEB (from "For EveryBody")
Bitcoin 4eb (like variant)
NewBit
Bitcoin CPU

Which option do you like more? Or offer your ...

[Thekool1s]

That seems unlikely. Coinbase doesn't want to pay more than the market demands, and mining pools don't want to give up fee revenue if they don't have to.

@squatter, But the real world suggests otherwise. Monopolies in real-world do all sorts of shady stuff to eliminate competition. Things like Price slashing, Preventing competition to emerge, do happen in the real world. Just look at Intel for an example. They had a monopoly in the CPUs market but now when AMD is coming back with Solid stuff, They have slashed their prices by almost 50%. So in my scenario, Coinbase paying a premium to eliminate competition is quite possible and just like you said there is nothing which can prevent this, In real world at least there are regulators which monitor this sort of behaviour, but with Bitcoin, there is nothing monitoring this. I feel like this is an area which can be further developed.

I will expand on my example, Let's say Coinbase in the future decided to eliminate the lighting network. It makes a "deal" with the pools to not accept any "closing" TX from the Lightning Networks to establish itself as an instant way to send bitcoin payments with current mechanism this can happen. I feel like a better model can be developed or a mechanism can be developed which will prevent this.

[squatter]

We can make a reasonable move. We can restart Bitcoin from scratch. For all. As it was with Monero.

What are you suggesting -- regular hard forks like Monero that will brick ASIC miners? That would swap mining centralization for development centralization and greatly diminish Bitcoin's POW security.

That seems unlikely. Coinbase doesn't want to pay more than the market demands, and mining pools don't want to give up fee revenue if they don't have to.

@squatter, But the real world suggests otherwise. Monopolies in real-world do all sorts of shady stuff to eliminate competition.

Sure, I just don't think that applies in this case. There is no monopoly here.

You're suggesting that exchanges and miners would collude to form a monopoly. For the reasons stated above, that would go against the financial interests of both parties.

So in my scenario, Coinbase paying a premium to eliminate competition is quite possible

Why would Coinbase pay a premium when a whole network of miners will do it at the market price?

I will expand on my example, Let's say Coinbase in the future decided to eliminate the lighting network. It makes a "deal" with the pools to not accept any "closing" TX from the Lightning Networks to establish itself as an instant way to send bitcoin payments with current mechanism this can happen.

There is no incentive for miners nor Coinbase to enter into a deal like this. The fee market is the optimal way for miners to maximize fee revenue. It's also the optimal way for users to minimize fees paid.

You can pay 10 satoshis per byte to get in the next block, or you can pay 1 satoshi per byte and let higher paying customers go ahead of you. The choice is yours as a user.

Miners are much more predictable. They will operate by profit motive. This is a feature, not a bug.

[flamehowk]

We can make a reasonable move. We can restart Bitcoin from scratch. For all. As it was with Monero.

What are you suggesting -- regular hard forks like Monero that will brick ASIC miners? That would swap mining centralization for development centralization and greatly diminish Bitcoin's POW security.

Why do constant hard fork? My POW algorithm cannot be used advantageously on ASIC / GPU / FPGA. There is no need to change it. It will work without changes throughout the life of New Bitcoin. Check out the gist of my algorithm:
https://bitcointalk.org/index.php?topic=5207996.0

[Zemomtum]

There are other alternatives to Proof of Work which will eliminate the monopoly currently experience in Bitcoin mining. One such is being provided by ELROND where everybody has a chance to propose with random mechanism and requires just 2GB with 2 core CPU to run.

[Wintersoldier]

Whatever is better and whatever is beneficial to all, I think that is what we need to do. Satoshi Nakamoto's principle is good but it is a fact that it is not perfect. If we can come up with something that somehow still have the original idea but enhanced and improved, I am sure that it will be a better one.

It need not to be original at all, because all of the improvements that we have currently on the market right now is mainly a product of all mixed ideas combined to generated better outputs. Bitcoin might not be the best crypto that could handle the most efficient transaction, but with the time we have, there still always a chance to develop a cryptocurrency that could handle the insufficiency that bitcoin has.

And to say, everyone needs satoshi principles, and also, satoshi's bitcoin also need the principles of others for the sake of development and improvement of what we have right now.

[flamehowk]

Ring Bit Function. 3 part.
https://www.youtube.com/watch?v=9-7NmuZXbdU&feature=youtu.be
An explanation of the new POW algorithm, which I call the Ring Bit Function (RBF), with C ++ code examples. In this part we will masking our chain of RBF rings.

There are other alternatives to Proof of Work which will eliminate the monopoly currently experience in Bitcoin mining. One such is being provided by ELROND where everybody has a chance to propose with random mechanism and requires just 2GB with 2 core CPU to run.

Proof of Stake is not a solution for all people. This is a solution for the rich. In addition, the main essence of money is that it should work, not lie dead weight. Proof of Stake makes people stop using cryptocurrencies or real money and just keep them in real estate. This is the death of the economy.

Therefore, Elrond will not really help anyone solve the problems of modern cryptocurrencies. This is a half measure. In addition, there are limitations to using Elrond that require the minimum necessary processing power.

For my algorithm, there are generally no restrictions on the used computing power. It can even be performed on an Arduino. This is REAL EQUALITY of all people in the world.

[squatter]

Why do constant hard fork? My POW algorithm cannot be used advantageously on ASIC / GPU / FPGA. There is no need to change it. It will work without changes throughout the life of New Bitcoin. Check out the gist of my algorithm:
https://bitcointalk.org/index.php?topic=5207996.0

Interesting. I don't understand the technical details well enough to judge, but I'm inherently skeptical of the claim that the algorithm cannot be parallelized and thus that ASICs would be impossible.

I'd like to see what some of the experts in Development & Technical Discussion have to say.

[IadixDev]

Why do constant hard fork? My POW algorithm cannot be used advantageously on ASIC / GPU / FPGA. There is no need to change it. It will work without changes throughout the life of New Bitcoin. Check out the gist of my algorithm:
https://bitcointalk.org/index.php?topic=5207996.0

Interesting. I don't understand the technical details well enough to judge, but I'm inherently skeptical of the claim that the algorithm cannot be parallelized and thus that ASICs would be impossible.

I'd like to see what some of the experts in Development & Technical Discussion have to say.

It cannot be parallelized, and its hard to make specialzed hardware who can beat a 1 cycle instruction, that would be really splitting hairs, and clock frequency its pretty much capped to common hardware.

There can be other problems with it, but i think they can be solved with good security.

Not sure if it can all work out together but it worth a try

[flamehowk]

Interesting. I don't understand the technical details well enough to judge, but I'm inherently skeptical of the claim that the algorithm cannot be parallelized and thus that ASICs would be impossible.

I'd like to see what some of the experts in Development & Technical Discussion have to say.

But this is true - it cannot be solved in parallel.
But I sent a request for technical expertise to where you asked.
https://bitcointalk.org/index.php?topic=5209849.new#new

The moderators deleted this thread, so I can no longer help you with your question. Now you must find out yourself what some of the experts in Development & Technical Discussion think about it.