My arguement with a friend who likes POS instead of POW.

[tjtonmoy]

So it all started with me sharing a photo of the Bitcoin logo with a friend of mine.
The conversation went like this:
Him: Bitcoin is old stuff, try ETH
Me: Old but Gold, Eth is centralized shit.
Him: Ethereum is better now in terms of sustainability.
Me: (Sent him a voice mail that says): POS AKA proof of stake is centralized, so they know your information and your holdings. On the other hand, POW AKA proof of work is decentralized, as proven by Bitcoin. And it depends on people working on it to earn something. So no one will ever have control over it. But as for ETH, if the government or any developers choose to, they can control it at any time. Because the information about the developers are public information. But till to this day, no one knows who Satoshi Nakamoto is. That makes it safe from being getting centralized. So as long as you keep holding BTC you are safe, your privacy is safe and also your assets.
Him: Still in POW, you can't earn/mine more of it if you don't have enough horsepower, most Bitcoin is mined by big farms, and it is energy hungry.
Me: Mining is not the only way to acquire Bitcoin, you can buy it with fiat and trade to make profits. And one thing to keep in mind that 1 BTC = 1 BTC
Him: Yet you need energy to mine that in the first place. And proof of stake is much more energy efficient. Almost 98%. And when all the BTC is being mined, no one will have an incentive to use so much to run a mining farm to write the blockchain then, how would the transaction be recorded? Each transaction in ETH blockchain is less energy hungry.
Me: People are competing in order to mine BTC for themselves. But when the competition is over, it won't be that much complicated and energy hungry. And development of technology will come up with a solution to tackle that problem. Maybe one automated service powerful enough to write all the records on the blockchain.

So the arguments went on for a long time. I would like to summarize that in some short words.

After that, I told him that even it is very useful and could be use with less energy, you need to think about the centralized matter. No matter how good it is, if it's centralized, anything could happen to it at any time. So I gave him the scam regarding FTX exchange and how bad centralized could get. Also the involvement of governments and the probability of getting hacked.
We went back and forth about many things.

I guess I was able to give him enough information and was able to explain in a way so that he could understand. The fact about high energy consumption  and how it will end someday. So in the end he told me that, the word side of crypto is that it's whole existence is fully based on human trust. So i told him that BTC is only pegged to USD in order to trade and make money. But the value will always be 1 BTC = 1 BTC. As long as you hold BTC, you owe that much BTC. So now he thinks that BTC is an asset like house/ land. So I told him that, yes, you can think it that way. As people always says BTC if for future investment. And people only hate BTC because they didn't have the chance to use it in order to know its importance. But at the end he said, "I am still not convinced BTC is perfect."

So I said nothing is perfect, but if you have to choose from one, you should go for BTC.

So that's the whole story. Please point out anything that maybe I am wrong about here, as I don't fully know about BTC myself. And yes, I asked him if I could share this personal conversation and he agreed. And one more thing, I would like to ask the seniors, what kind of examples or information I should provide him in order for him to fully understand it? Share your knowledge here so that I can show him.

[1714059737]

1714059737

[franky1]

PoW
if someone has 1000 asics (140peta(0.14exa)
if the network is 280exa they will get ~ 0.05% of rewards

if someone has 100 asics (14peta(0.014exa)
if the network is 280exa they will get ~ 0.005% of rewards

if someone has 10 asics (1.4peta(0.0014exa)
if the network is 280exa they will get ~ 0.0005% of rewards

you dont need to have big horsepower

what hash you put in results in same ratio of reward out

someone paying 1000x input gets 1000x output
someone paying 1x input gets 1x output

thus if someone with 1asic is getting 0.00000312 a block average
thus if someone with 1000asics is getting 0.00312000 a block average
the result is then when looking at the bitcoin price they both make the same % of profit/loss
PoS is where someone locks up value (their stake) and gets free money for doing no work
when locking value into central custodian, that custodian if it has enough stake can change rules
and users wont want to reject that custodians changes because rejecting it means losing their own stake(stake penalty).
ethereum for the last year has not allowed people to un-stake from their custodian thus they cant jump to a different custodian to then reject a change without penalty. thus being locked to a custodian makes that custodian have power

PoW is where people can move to a new pool in under 3 seconds, meaning a pool has to stay honest or lose its workers(hashrate)
as for the environment /eelctric debates:

PoW even if the pool stratum server is in texas or iceland or thailand.
if you have XXXX asics you dont need to have them locked to one pool/stratum nor the same location as the pool

you dont even need your asics in one physical warehouse
you can have XX shipping containers with XXX asics each spread out in different neighbourhoods/states/countries linking to pools in other locations

many large asic farms are set up in regions of renewable area's doing private contracts with energy companies for supplies of excess renewable cheap energy

oh also tell your friend this warning
ethereums base mining cost bottomline(cheapest mining) was ~$800/eth when ethereum was PoW
the market above that speculated at a ~1.5x-6x
when it changed to PoS that bottomline cost(stake cpu cost of masses) become ~$40
the market for ethereum is now speculating at >35x

this is too high. the reason why ethereum has not had its price correction yet is due to staking being stuck in locks with no way YET to unlock stake for ethereum to sell their proceeds

its been held artificially at pre PoS levels due to other market arbitrage factors

as soon as un-staking is possible expect your friend to see the correction from a 35x+ speculation back down to a rational 1-6x speculation
(last year $1.2k-$4.8k)  after unstaking is able ($60-$240) is the expectation

[Upgrade00]

So i told him that BTC is only pegged to USD in order to trade and make money. But the value will always be 1 BTC = 1 BTC. As long as you hold BTC, you owe that much BTC.

Bitcoin is paired to USD but not pegged to it. Stable coins are pegged to assets to retain their value, Bitcoin is not a stable coin, but is paired with different fiat currencies to show its value.

[bittraffic]

Maybe include something like ETH does have a CEO while BTC has none. Having a CEO means centralization can be compromised.

I hope though you will still continue to be friends lol If this kind of conversation happened probably in the 90s generation, I think it's already a fight. You don't have to prove something to him, you only need to show the rank and the price comparison so I hope it won't end up in physical contact. 

[lionheart78]

Each person has their own preference.  It is ok to have an exchange of idea and discuss it in a friendly way.  I can say you give a good points @OP but some of your arguments are lacking such as how you describe POW and POS, it could be better if you add the network security issue to strengthen your point of view.  Vulnerability is one of the weaknesses of POS while it is the strength of POW.  You can also check this article[1] and can use the information stated on it.

Vulnerability to Attack
Proof-of-Stake systems are vulnerable to centralization and capture because control of the network is determined solely by capital, which is far more centralized than labor and cheap energy. In a PoS network worth $100 billion where 10% of tokens are staked, the $100 billion network can be taken over by any party able to allocate $10 billion. All the attacker would have to do is send $10 billion in tokens to a staking contract.

In a Proof-of-Work network, capital, labor, and efficient allocation of both are required to execute an attack on the network. Attacking a network with $10 billion of security would require purchasing ASICs, acquiring space and energy contracts to mine at a larger scale than the entire network, and acquiring and deploying the labor to execute the attack. If such an attack were underway, the entire network would likely be made aware ahead of time by the immense demand for ASICs and electricity.

[1] https://river.com/learn/proof-of-work-pow-vs-pos-proof-of-stake/

[AverageGlabella]

I hate shitcoiners who think that their altcoin is the next big thing because they have changed the mining from POW to POS and they think it is a better system. Ask him to write down his reasons and I think we can counter every one of his reasons and prove that proof of stake does not work and has been proven by shitcoins before eth. Proof of work is not perfect because of the energy it uses but it is the best solution we have atm.

[un_rank]

You don't have to prove something to him, you only need to show the rank and the price comparison

Rank by market capitalization does not distinguish one currency to be better than another. It is math and devs can use tricks to inflate the value their asset has. Price also does not show true value.

...

The energy consumption which is talked about like a con is what keeps Bitcoin secure, far more secure than POS which has been hacked quite a bit.

- Jay -

[AverageGlabella]

The energy consumption which is talked about like a con is what keeps Bitcoin secure, far more secure than POS which has been hacked quite a bit.

Mining rigs are getting better at conserving energy too and I think there will be more improvements in the next couple of years because Bitcoin has been slandered in the news for causing more pollution to the world then banks which is not true. I think mining companies will try to make their device more efficient and we can finally counter the slander that makes it look like Bitcoin is inefficient. Proof of Stake makes any coin that it is being used by less secure and I think this will be exposed in the next couple of years to and coins will be forced to change back to proof of work or will not exist any more.

[thecodebear]

Seems like your friend doesn't know how mining works.

The typical lack of education view on Bitcoin is "a ton of energy is required for each transaction" but of course that isn't at all how it works. Transactions and amount of energy from mining don't have anything to do with one another.

Your friend seems to think if less energy is used once there are no more block rewards beyond tx fees that will mean transactions won't get processed anymore haha. Sadly this is probably what most people think.



You could also point out the huge benefits for society that Bitcoin mining has, which Ethereum PoS doesn't have because there is no mining anymore on Ethereum. Specifically,
1. Bitcoin allows society to use stranded energy which naturally will be renewable energy which will increase the production of renewables which will help lower their cost.
2. Also bitcoin mining the past few years has started to take place at the actual power plants. This is the HUGE benefit to society that Bitcoin mining provides. The world wastes something like 30% of the energy that is produced just because to keep power available power plants need to produce far in excess of what is needed because power consumption of society changes on any given day or depending on the time of day or depending on the weather or events or whatever. There is MASSIVE power waste built into the system to keep it running. It is very likely in the future most Bitcoin mining will be done directly at power plants consuming the excess completely wasted energy, and these miners will get it very cheap because the power plant wouldn't make any money on it otherwise, which will mitigate a lot of the worry over something bad happening to bitcoin when block rewards are gone because mining should be a lot cheaper in the future. It also makes energy production far more lucrative, meaning the world can build out more energy production which is beneficial for society. Also if many Bitcoin mining companies choose to only operate on renewable energy this will make producing renewable energy far more lucrative than fossil fuels so this, much more than the first point mentioned above, will be a driving factor for spreading renewable energy in the world. And whenever more energy is being consumed from these power plants they can shut off the mining machines so miners don't get in the way of energy being sent to society. Most people think Bitcoin mining is bad and is wasteful and is bad for the environment, if everyone just understood this one paragraph here everyone would be praising how amazing Bitcoin mining is not just for Bitcoin but for the world.

Also note that in a world in which much of mining uses all that wasted energy that means extra energy isn't even being used for mining, its just already produced wasted energy. So if most of bitcoin mining ends up being at renewable power plants and stranded renewables that means Bitcoin mining will be running off otherwise-wasted clean energy so the idea that Bitcoin would be using too much energy or that PoS is better because it uses less energy would be a completely nonsensical statement because Bitcoin wouldn't be using any 'extra' power.

NOT using energy is actually a negative because PoS provides nothing valuable to society while Bitcoin mining has huge benefits to society precisely because it does run on energy.


You could also point out how the energy use is always balanced out because mining creates an economy in bitcoin for miners so there is never too much energy used for bitcoin mining because by definition it would then be unprofitable. Energy use always stays in the range of profitability meaning it is always in balance to the economic value that is being created.



You could also point how Ethereum is centralized by PoS rewarding those who already have the most Ether - very similar to how rich people keep getting richer in world because the system is geared toward more opportunities being given to the rich. And if you're already rich you're likely going to be less likely to need to sell your staked/earned Ether whereas the average person will need to sell as a source of income so the Eth rich get richer through Ethereum. Whereas in Bitcoin there is no staking, the only way to get more Bitcoin is to put in the resources to mine or to put in the resources to buy more Bitcoin. Rich or poor are just as able to hold on to their Bitcoin if they are investing excess money in it.


You could point out the centralization of Ethereum's pre-mine versus Bitcoin's mining that distributed Bitcoin over many years, whereas like half of the current Ethereum supply was sold on day 1 in its pre-mine.

You could point out how Ethereum is essentially controlled by Vitalik and the Ethereum Foundation which is very centralizing while Bitcoin is an open source project and always has been since Satoshi left the community within a couple years of creating it.


I actually don't know if Eth2 changed how nodes work on Ethereum but if they work the same way then there are a much smaller number of expensive and hard to operate archival nodes on Ethereum whereas Bitcoin as many more full nodes, and this is because Ethereum has to handle so much data so it is much more centralized, and in fact at least once when AWS went down something like 30% of the Ethereum network was down because many nodes just run on AWS because they are too hard to run oneself, meaning much of the network relies on Amazon lol.

[BenCodie]

Him: Bitcoin is old stuff, try ETH

This makes it sound like Bitcoin was released and no updates have been made since. You should have referred to it being at version 24 plus with developers constantly making improvements to this day.

Him: Ethereum is better now in terms of sustainability.

In terms of energy? Sure. In terms of economic stability? I don't think so. I would say that Bitcoin is healthier and more sustainable economically than Ethereum.

Him: Still in POW, you can't earn/mine more of it if you don't have enough horsepower, most Bitcoin is mined by big farms, and it is energy hungry.
Him: Yet you need energy to mine that in the first place. And proof of stake is much more energy efficient. Almost 98%. And when all the BTC is being mined, no one will have an incentive to use so much to run a mining farm to write the blockchain then, how would the transaction be recorded? Each transaction in ETH blockchain is less energy hungry.

"horsepower"? If he is short-handing to say "electricity" or "hash rate" then he isn't very good at shortening his sentences with more useful words.. If he doesn't know what hash rate is then that says enough as to how valid his opinion is.

I also wouldn't call ETH less energy hungry per transaction. The consensus mechanism's efficiency is based on validating transactions...not energy consumption per transaction. It's still a stupid argument to make to this day anyway. There are much worse corporations doing so worse things to the environment and consume much more energy in comparison to what Bitcoin does.

[Dump3er]

Maybe include something like ETH does have a CEO while BTC has none. Having a CEO means centralization can be compromised.

I hope though you will still continue to be friends lol If this kind of conversation happened probably in the 90s generation, I think it's already a fight. You don't have to prove something to him, you only need to show the rank and the price comparison so I hope it won't end up in physical contact. 

Ethereum also doesn't have a CEO in the sense that there are people under him who have to follow him. That is not the case. Buterin may appear as the smartest brain and that is why the majority follows him. But he has arguments with lots of developers as well. Everything is open source and the things can be openly discussed and criticized. The typical CEO role that you are referring to is also non-existent in Ethereum in my opinion.

If Satoshi showed up tomorrow, verifying he still has the wallets' keys and proposes a change to the protocol, I wonder how much resistance there would be against proposed changes (depends on the change of course, but let's assume it's controversial).

[OcTradism]

You don't have to convince your friend about that more than one or two times. After two or maximum three times, let him be with his opinion.

At the very last discussion, you should tell him that why he are fearful of centralized banks, pick cryptocurrency as alternative but at the end he pick a centralized cryptocurrency like Ethereum.

It would be my ending words, may last effort to convince him.

[BenCodie]

You don't have to convince your friend about that more than one or two times. After two or maximum three times, let him be with his opinion.

At the very last discussion, you should tell him that why he are fearful of centralized banks, pick cryptocurrency as alternative but at the end he pick a centralized cryptocurrency like Ethereum.

It would be my ending words, may last effort to convince him.

It also depends on the responses you are giving if you are aiming to inform or change opinion. The way the OP went about it could have definitely been better. The argument of POW versus POS is simple, at least to me. You just need to convey the facts in an easy to digest and indisputable way. 

[Minor Miner]

I hate shitcoiners who think that their altcoin is the next big thing because they have changed the mining from POW to POS and they think it is a better system. Ask him to write down his reasons and I think we can counter every one of his reasons and prove that proof of stake does not work and has been proven by shitcoins before eth. Proof of work is not perfect because of the energy it uses but it is the best solution we have atm.

Nothing is perfect, both POW and POS have their own pros and cons. The second thing: each person has their own preferences, we should only argue for fun, not force them to believe what we say or we have to believe them. If you care about privacy, and the security of decentralized technology, then bitcoin is your choice, but your friend doesn't care about privacy nor decentralization, what they want is a high profit, then altcoin is their choice. The choice is personal, just like religion, we cannot force others to follow our religion, or have to give up our faith to follow their religion.

[Despairo]

I don't understand with people who really like to discuss about energy consumption and Bitcoin, yeah Proof Of Work do require more energy than Proof Of Stake, but why you're really so care with energy consumption? have you turn off your lamp when you're not use it, going to outside by walking and not driving with your car, not watching television etc? I guess you're still do that and it's really wasting energy!

If people are really care with energy, they shouldn't live in modern lifestyle instead they need to back to live with primitive lifestyle.

[franky1]

the energy debate is not actually a environment concern.. its just a thing some people read about and attached themselves to as if its a new fad, trend they need to be part of to sound like they are environmentalists

you can tell they just read about it somewhere because they have not done the math themselves
they have not worked out that there are only 2million asics or less around the whole world

and yet electric cars use more electric than an asic and electric cars are not even mid way through their mass adoption

data centers use more energy than bitcoin

[posi]

I don't understand with people who really like to discuss about energy consumption and Bitcoin, yeah Proof Of Work do require more energy than Proof Of Stake, but why you're really so care with energy consumption? have you turn off your lamp when you're not use it, going to outside by walking and not driving with your car, not watching television etc? I guess you're still do that and it's really wasting energy!

If people are really care with energy, they shouldn't live in modern lifestyle instead they need to back to live with primitive lifestyle.

Bitcoin is almost perfect, and those who do not like Bitcoin do not find any better weaknesses to depose Bitcoin, and energy is the only thing they can use to attack Bitcoin.
I believe they know that using Bitcoin's energy is not a problem because we are in a world of technology that controls all, consuming energy, and causing heat for the Earth is inevitable.
Once we don't like something, we will always find its bad points to criticize, so persuading a person who doesn't like Bitcoin really wastes time.

[franky1]

the main argument for PoS are as simple as this:
PoS advocates want "money for nothing"

yes it costs money to mine PoW / bitcoin.. that cost is what gives it value and security
also by power companies have XXX capacity and only XX demand. so if they can sell more to mining farms then that means more income meaning they dont have to demand higher prices from residents. thus it benefits other power users

PoS costs nothing to make blocks(well a reasonable nothing of $40/eth)
but where defying some malicious actor and rejecting a malicious actor costs its users alot. (their whole stake) so they are reluctant to lose money rejecting malicious actors which
by going PoS loses value (less/no cost in securing blocks) and loses security due to fear of losing peoples wealth  

[Kakmakr]

You know that Bitcoin was designed by Satoshi Nakamoto to replace the Block reward with the miners fees as reward in the future ...right? The amount of transactions are supposed to grow and the miners fees with that, so that it is large enough for miners to compete for it in the future.

So, we are hoping that enough use cases are implemented that the amount of transactions will be enough to generate more than generous miners fee, for mining to be sustainable.

Also, as the competition for the Block reward decrease... the difficulty are adjusted, so less hashing power will be needed to compete for the miners fees. (Large mining farms might exit the scene.. and GPU mining might even come back)  

[worle1bm]

You don't have to convince your friend about that more than one or two times. After two or maximum three times, let him be with his opinion.

At the very last discussion, you should tell him that why he are fearful of centralized banks, pick cryptocurrency as alternative but at the end he pick a centralized cryptocurrency like Ethereum.

It would be my ending words, may last effort to convince him.

Right if someone is not ready to listen to the right advice and still prefer to live in their own fake thoughts we should let them live in there without making or wasting time over them.They should keep in mind they are just using the digital version of central banking system with POS and they don't want to have any sort of financial freedom so their choice.