A Two-Round Proof of Work instead of PoW

[larry_vw_1955]

Doesn't this scheme compromise the security of the bitcoin network. I mean, the security aspect of it is based on the total hashrate at every moment in time. if at any moment it decreases...then there's a potential weakness.

Yes it does. It makes half PoW and half of luck. If this is good, then make it 100% luck. does it work? No. Its not secure.
This propose just lower security for name of "economical".

It's not even necessarily economical. People will just ramp up their hashing power for round 1 to try and get into round 2 so the energy expenditure over those 2 minutes would rise way above normal.

And then for the other 8 minutes, they got the bitcoin network by the balls so to speak. Relying on a small subset of miner hashing power. Sounds like a recipe for disaster. But I do admire the OP for defending his proposal and taking the time and effort to discuss it here.

[1714130396]

1714130396

[Epictetus]

It's not even necessarily economical. People will just ramp up their hashing power for round 1 to try and get into round 2 so the energy expenditure over those 2 minutes would rise way above normal.

And then for the other 8 minutes, they got the bitcoin network by the balls so to speak. Relying on a small subset of miner hashing power. Sounds like a recipe for disaster. But I do admire the OP for defending his proposal and taking the time and effort to discuss it here.

I don't think TRPoW is a recipe for disaster. Far from it. Keep in mind that Bitcoin worked with small group of miners for many years.

As I wrote to you previously. We can find an optimal value of N2 that does not undermine the security of Bitcoin with TRPoW. Intuitively an upper bound of such value is O(SquareRoot N1). Assuming that the winner of Second Round is among N2 List of N2 miners instead of only N2 first miners. I think an optimal value of N2 could be in O(Log(N1)) based on a similar calculation done by EPFL Distributed Algo team: https://arxiv.org/abs/1908.01738

You can also see Bitcoin with PoW as Bitcoin with TRPoW where N2 = N1.

If we assume for the sake of argument that N1 = 1000000 and N2 = Square Root of N1 = 1000.
The reduction of energy can go drastically because we will have 1000 000  - 1000 = 999 000 miners (99.9% of the network) not doing the Second Round. We will save huge amount of electricity without undermining the security of the blockchain.

[garlonicon]

I don't think TRPoW is a recipe for disaster.

Then go for it, release just another altcoin and see how it will turn out. You can release some kind of test network first, just to check if your theory works in practice.

You can also see Bitcoin with PoW as Bitcoin with TRPoW where N2 = N1.

You can make it backward-compatible, just by producing first-phase blocks as today and adding some rules to enforce second-phase for these blocks. The simplest way to do that could be using difficulty to decide, how long the second nonce should be. Then you have previous block hash with some zeros, you can place your second-phase nonce there, then taking a single 80-byte block header is enough.

For example:

Code:

FirstRoundHeader {
  version=01000000
  previousBlockHash=6fe28c0ab6f1b372c1a6a246ae63f74f931e8365e15a089c68d6190000000000
  merkleRoot=982051fd1e4ba744bbbe680e1fee14677ba1a3c3540bf7b1cdb606e857233e0e
  time=61bc6649
  difficulty=ffff001d
  nonce=01e36299
}

SecondRoundHeader {
  version=01000000
  previousBlockPartialHash=6fe28c0ab6f1b372c1a6a246ae63f74f931e8365e15a089c68d6190000
  secondNonce=000000
  merkleRoot=982051fd1e4ba744bbbe680e1fee14677ba1a3c3540bf7b1cdb606e857233e0e
  time=61bc6649
  difficulty=ffff001d
  nonce=01e36299
}

Because you can see 0x1d value in the difficulty, you know that you can take three bytes from the previous block hash and there must be zeroes to be valid. Also, there is no need for adding any public key to the block header, because it is already calculated in the merkle root. Also, you can add more fields to each header in the coinbase transaction if you really need them, there is no need to add them directly to your headers.

[Epictetus]

I don't think TRPoW is a recipe for disaster.

Then go for it, release just another altcoin and see how it will turn out. You can release some kind of test network first, just to check if your theory works in practice.

Totally agreed with you. I think the idea needs to be tested. At least for the sake of the experiment. 

You can also see Bitcoin with PoW as Bitcoin with TRPoW where N2 = N1.

You can make it backward-compatible, just by producing first-phase blocks as today and adding some rules to enforce second-phase for these blocks. The simplest way to do that could be using difficulty to decide, how long the second nonce should be. Then you have previous block hash with some zeros, you can place your second-phase nonce there, then taking a single 80-byte block header is enough.

For example:

Code:

FirstRoundHeader {
  version=01000000
  previousBlockHash=6fe28c0ab6f1b372c1a6a246ae63f74f931e8365e15a089c68d6190000000000
  merkleRoot=982051fd1e4ba744bbbe680e1fee14677ba1a3c3540bf7b1cdb606e857233e0e
  time=61bc6649
  difficulty=ffff001d
  nonce=01e36299
}

SecondRoundHeader {
  version=01000000
  previousBlockPartialHash=6fe28c0ab6f1b372c1a6a246ae63f74f931e8365e15a089c68d6190000
  secondNonce=000000
  merkleRoot=982051fd1e4ba744bbbe680e1fee14677ba1a3c3540bf7b1cdb606e857233e0e
  time=61bc6649
  difficulty=ffff001d
  nonce=01e36299
}

Because you can see 0x1d value in the difficulty, you know that you can take three bytes from the previous block hash and there must be zeroes to be valid. Also, there is no need for adding any public key to the block header, because it is already calculated in the merkle root. Also, you can add more fields to each header in the coinbase transaction if you really need them, there is no need to add them directly to your headers.

Thank you Garlonicon for these great and precious ideas/suggestions. Much appreciated. Let's me think of it. I will update you here in all cases.

[larry_vw_1955]

I don't think TRPoW is a recipe for disaster. Far from it. Keep in mind that Bitcoin worked with small group of miners for many years.

that was before bitcoin exploded onto the world scene. the whole world depends on it now and i dont know if there's any justification for trying to reduce energy consumption. for example, do you think bitcoin miners are just going to let their hardware sit idle for 8 minutes? or however long the 2nd round lasts? they'll divert their hashing power to something else for that amount of time and then bring it back when the next round 1 starts. so all you're really accomplishing is weakening your own network by letting go of some of its hashing power which will get used somewhere else. it's not a net gain for the environment. it's neutral.

the hardware is there. it's going to be running and hashing something. you might as well take advantage of it fully, which is what bitcoin currently does. thats how i see it anyway. we don't care about cardona or ethereum here. so we dont want bitcoin hardware being diverted to strengthen those networks.

[Epictetus]

I don't think TRPoW is a recipe for disaster. Far from it. Keep in mind that Bitcoin worked with small group of miners for many years.

that was before bitcoin exploded onto the world scene. the whole world depends on it now and i dont know if there's any justification for trying to reduce energy consumption. for example, do you think bitcoin miners are just going to let their hardware sit idle for 8 minutes? or however long the 2nd round lasts? they'll divert their hashing power to something else for that amount of time and then bring it back when the next round 1 starts. so all you're really accomplishing is weakening your own network by letting go of some of its hashing power which will get used somewhere else. it's not a net gain for the environment. it's neutral.

the hardware is there. it's going to be running and hashing something. you might as well take advantage of it fully, which is what bitcoin currently does. thats how i see it anyway. we don't care about cardona or ethereum here. so we dont want bitcoin hardware being diverted to strengthen those networks.

Hi Larry,

I do see your point very well.
But I think the question is a bit more philosophical: Just because we have a machine does this means that we need to use it at all cost and all the time?
We don't use our Laptop / Car all the time just because we bought them. We only use them when we need them.
Although the mining hardware is there, we still need Electricity to make it work. So the question now what is the tradeoff between electricity consumption and the hardware usage over a long run ?
It is known that the intensive usage of a hardware make it wear quickly.
So We can see TRPoW as way of reducing usage of mining machines which will make them last longer.

For the sake of argument, let's say Round 1 lasts 2min each 10min of Block Time. This means that the mining machines will be used 20% of the time. We can hope this will extend their lifetime by a factor of 5! I know the equation is not linear. Which will help the environment by reducing the machines production and the electricity consumption. The other benefit is against the Selfish mining attack.
TRPoW will make Bitcoin great again!!!

What do you thing?          

[tromp]

Which will help the environment by reducing the machines production

On the contrary. Even if your scheme worked, and you could force miners to sit idle 80% of the time,
that means they'll reinvest the saved electricity costs into buying MUCH MORE hardware to stay competitive.

As long as Bitcoin issues $50M dollar's worth every day, we can expect miners to collectively spend nearly that much money in competing for it.

All you achieve is a shift from electricity costs to hardware costs.

What do you thing?          

Sorry; thinging is not my thing:-(

[larry_vw_1955]

Hi Larry,

I do see your point very well.
But I think the question is a bit more philosophical: Just because we have a machine does this means that we need to use it at all cost and all the time?
We don't use our Laptop / Car all the time just because we bought them. We only use them when we need them.

That's because at least in the way you are describing it, a laptop or car is something for personal use. Just like a toothbrush.

Although the mining hardware is there, we still need Electricity to make it work. So the question now what is the tradeoff between electricity consumption and the hardware usage over a long run ?
It is known that the intensive usage of a hardware make it wear quickly.
So We can see TRPoW as way of reducing usage of mining machines which will make them last longer.

I think bitcoin miners are more than capable managing their hardware and determining the optimal settings to run it at.

For the sake of argument, let's say Round 1 lasts 2min each 10min of Block Time. This means that the mining machines will be used 20% of the time. We can hope this will extend their lifetime by a factor of 5!

I looked up a stat that said the mining difficulty increased by 45% in the last 90 days. it probably doesn't always increase at such a large rate but i think it's safe to say it is always getting bigger. harder. now. given that, one would expect bitcoin miners to want to get the most out of their hardware for the limited amount of time it has until it becomes unprofitable to run any longer. no one is going to extend their hardware's lifetime by a factor of 5 since it will become unprofitable long before that time ever comes.

I know the equation is not linear. Which will help the environment by reducing the machines production and the electricity consumption. The other benefit is against the Selfish mining attack.
TRPoW will make Bitcoin great again!!!

What do you thing?         

I think it's great just how it is regarding Proof of work. But I'm always interested to learn of other blockchains using alternatives to pure proof of work. Like chiacoin. 

[Epictetus]

Which will help the environment by reducing the machines production

On the contrary. Even if your scheme worked, and you could force miners to sit idle 80% of the time,
that means they'll reinvest the saved electricity costs into buying MUCH MORE hardware to stay competitive.

As long as Bitcoin issues $50M dollar's worth every day, we can expect miners to collectively spend nearly that much money in competing for it.

All you achieve is a shift from electricity costs to hardware costs.

Good point.  High prices will drive competition crazy and we can expect miners to do whatever needed to make more money.
TRPoW does not affect the competition edge of a miner. So If everything stays the same, a miner will have a lower electricity bill
with more or less the same earning potential.  So, it will reduce the miners business cost and increase their profit.

[Epictetus]

I think it's great just how it is regarding Proof of work. But I'm always interested to learn of other blockchains using alternatives to pure proof of work. Like chiacoin. 

Proof of Space is driving the hard disk drive market crazy I read in the news. 

[larry_vw_1955]

I think it's great just how it is regarding Proof of work. But I'm always interested to learn of other blockchains using alternatives to pure proof of work. Like chiacoin. 

Proof of Space is driving the hard disk drive market crazy I read in the news. 

Yeah I know! thats kind of why I'm not a big fan of it because it raises the price of things for everyone else too. Kind of like ethereum did for video cards.

[Wind_FURY]

What would be the costs of a “two-round” Proof of Work algorithm compared to regular POW? More or less, for the same level of security? More or less, for the same incentives? What feature would make it more attractive for the mining cartel?

[Epictetus]

What would be the costs of a “two-round” Proof of Work algorithm compared to regular POW? More or less, for the same level of security? More or less, for the same incentives? What feature would make it more attractive for the mining cartel?

TRPoW does not affect the competition edge of a miner. So If everything stays the same, a miner will have a lower electricity bill
with more or less the same earning potential.  So, it will reduce the miners business cost and increase their profit.
The mining cartel will make more money with less running cost.  

[Wind_FURY]

What would be the costs of a “two-round” Proof of Work algorithm compared to regular POW? More or less, for the same level of security? More or less, for the same incentives? What feature would make it more attractive for the mining cartel?

TRPoW does not affect the competition edge of a miner. So If everything stays the same, a miner will have a lower electricity bill with more or less the same earning potential.  So, it will reduce the miners business cost and increase their profit.

The mining cartel will make more money with less running cost.  

Have you received some feeback from a Core Developer, or from someone who is not a pleb? No offense to the members of this forum. Plus no offense to you, but how can we know that your proposal isn’t like the Space Ghost meme that says, “I am new to Bitcoin, and I am here to fix it”?

[Epictetus]

What would be the costs of a “two-round” Proof of Work algorithm compared to regular POW? More or less, for the same level of security? More or less, for the same incentives? What feature would make it more attractive for the mining cartel?

TRPoW does not affect the competition edge of a miner. So If everything stays the same, a miner will have a lower electricity bill with more or less the same earning potential.  So, it will reduce the miners business cost and increase their profit.

The mining cartel will make more money with less running cost.  

Have you received some feeback from a Core Developer, or from someone who is not a pleb? No offense to the members of this forum. Plus no offense to you, but how can we know that your proposal isn’t like the Space Ghost meme that says, “I am new to Bitcoin, and I am here to fix it”?

Be cool baby. Things will come in their due time. Stay tuned.

[vjudeu]

Have you received some feeback from a Core Developer, or from someone who is not a pleb?

I guess not. All changes described in the whitepaper from this topic are backward-incompatible, that would mean a hard fork (or an altcoin, if it would be based on its own Genesis Block). But even in a soft fork case I doubt miners will go for it. They have no reason to split the whole process into two phases. It will be just another obfuscated Proof of Work, where things are the same like in plain, old, single-phase Proof of Work, but only some people will know how to produce the best blocks.

Or even worse: if it would be backward-compatible, then it could be simplified as just another merge-mined coin: by producing coins valid in both chains, miners will never switch to your coin, they would just get the same amount of Bitcoins and YourCoins, then sell YourCoins for Bitcoins, so the price will fall. I guess the same things would happen as for example in Luck: first some discussions on bitcointalk, then some negative feedback, then some test version release without addressing any problems from that feedback, and then creating just another altcoin that would be pumped and dumped as usual.

So, it will reduce the miners business cost and increase their profit.
The mining cartel will make more money with less running cost.

It would be true only for a short period of time. Then, the difficulty will adjust. Miners can switch between Bitcoin and your coin, also they will probably sell everything when your coin will enter some exchange for the first time.

Plus no offense to you, but how can we know that your proposal isn’t like the Space Ghost meme that says, “I am new to Bitcoin, and I am here to fix it”?

It probably is. But when people don't want to learn from mistakes made by others, then they have to make their own.

Be cool baby. Things will come in their due time. Stay tuned.

Satoshi first did a lot of coding and testing, and then wrote the whitepaper. I think in many coins, things are going backwards: first there is some unchecked idea with some whitepaper, then there is some coding and testing, and later there are many big surprises, because some things were not checked before releasing the whitepaper and they are getting out of control.

[Epictetus]

Satoshi first did a lot of coding and testing, and then wrote the whitepaper. I think in many coins, things are going backwards: first there is some unchecked idea with some whitepaper, then there is some coding and testing, and later there are many big surprises, because some things were not checked before releasing the whitepaper and they are getting out of control.

Thank you very much Vjudeu for your time and your great sharing and all the links. Much appreciated Bro. I learned a lot from you since the beginning of this thread. The content you shared is brilliant.

[Epictetus]

The OP appears to be proposing something that will result in only 0.1% of the miners using their equipment in the second round of mining, and the remaining 99.9% of miners will turn off their equipment during the second round.

The above is not possible due to pool mining. As an example:
If there were 10,000 pools participating in the 1st round, only 10 would make it to the second round. Once the second round starts, the miners who were mining for the 9,990 pools that are not participating in the second round would switch to one of the 10 remaining pools.

There are currently 4 major mining pools (with the likelihood of there being more that are not public). Most likely, they would all be able to participate in the second round of mining, however in the event that one pool is unable to participate in the second round, the miners mining for that pool will switch to one of the remaining pools. If a "solo miner" would be able to make it to the second round, it would make financial sense for them to "sell" the ability for others to "mine in their name" and if no pools are able to participate in the second round, all of the pool miners would "buy" the ability to mine in one of the solo miners who are participating.

tl;dr - total electric consumption will not be reduced by implementing the OP's proposal.

It is true that miners can/will organize themselves in pools and participate in the hash calculation all the time. TRPoW can still be able to reduce the total energy consumption in the network thanks to the non-pooled miners.
Now the question what is the fraction of non-pooled miners in Bitcoin network?

[garlonicon]

Now the question what is the fraction of non-pooled miners in Bitcoin network?

You can see for example here: https://github.com/taprootactivation/Taproot-Activation. As far as I know, only the biggest pools were contacted for taproot support, there were no solo miners having some significant power. That means even if your proposal would be backward-compatible, you would ask big mining pools for support, not some independent solo miners. Of course you can rely on solo miners, but then I expect you wouldn't get more than few percent of the mining power supporting your version.

[Epictetus]

Now the question what is the fraction of non-pooled miners in Bitcoin network?

You can see for example here: https://github.com/taprootactivation/Taproot-Activation. As far as I know, only the biggest pools were contacted for taproot support, there were no solo miners having some significant power. That means even if your proposal would be backward-compatible, you would ask big mining pools for support, not some independent solo miners. Of course you can rely on solo miners, but then I expect you wouldn't get more than few percent of the mining power supporting your version.

So True. Pool domination is a reality. Now we need a way to complicate life for mining pools.
So I got this new idea that I called: Jakarta Proof of Work. Instead of running a Two-Round PoW, we just directly limit the miners that are going to participate in the hash competition for a block.
Read article here: https://www.researchgate.net/publication/356414880_JPoW_and_TRPoW_Variants_of_Proof_of_Work
or directly here or google drive: https://drive.google.com/file/d/1f_a2obArSQ9kmFVeqE11ApPYTk31IYv2/view?usp=sharing
==============Begin==============
The other simple idea is to do like Jakarta’s odd-even traffic policy to limit the number of cars entering Jakarta: the policy stipulates that cars whose license plate ends in an odd number are only allowed to circulate on odd-numbered dates and vice versa. So, like in the case of Jakarta, we don't want every miner to participate in the hash computation all the time. So, we propose a Jakarta PoW (JPoW) where only miners with (hash mod N < K) where, for each block, for each miner with its public key $PublicKey$:
Equation (1):  hash = Hash(Block Head + Public Key)
If (hash mod N < K), then the miner will go for the traditional Bitcoin PoW.  If (hash mod N > K), then the miner will move to the next block without calculating any hash. $N$ and $K$ are parameters to adjust to determine the number of miners participating in the hash competition. To get a similar model like Jakarta odd-even policy, we can just choose $N=2$ and $K=1$.  When a miner receives an $nonce$ from another miner, it can easily verify that the sender is authorized to participate in the hash computation. If all is fine, it accepts the $nonce$ and moves to the next block competition. If the miner sending the $nonce$ is not authorized to participate in the hash computation, the miner receiving the $nonce$ will ignore what it received and continue solving for its own $nonce$ and listening to the network like in Bitcoin. In JPoW, if a miner ignores the rules and just go for the hash calculation, such miner will be ignored by the honest nodes in the network.
With equation (1), it will be still possible for miners that cannot participate in a hash computation to rent their machines to miners that are authorized to hash as the public keys information is available to all miners. So, to resolve this issue, we replace $Public Key$ by $sign(Block Head)$:
Equation(2): hash = Hash(Block Head + sign(Block Head))
The $sign(Block Head)$ can be produced by the miner only. And it is not available to all the miners at the time of the block creation. If a miner wants to participate in a pool, it will need to send its $sign(Block Head)$ to its pool. The pool will still be able to help on the hash calculation.
Even though $sign(Block Head)$ will slow down the process as the pool will still need to wait for its arrival before starting looking for the nonce while hashing for $Hash(Block Head + sign(Block Head) +  nonce)$. To complicate the problem further for the pool, we slightly modify the PoW and search for a nonce while hashing the following equation (3):  PoW hash = Hash(Block Head + sign(Block Head) +  sign(nonce))
The replacement of $nonce$ in PoW by $sign(nonce)$ will force the miner to either share its private key with the mining pool or calculate the hash itself. Sharing one's private key is a significant constraint and it is expected to complicate mining pool formation.
===============End====

Your comments / suggestions / critics are the most welcome as always.

 Thank you