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Question: Annual 10% bitcoin dividends can be ours if  Proof-of-Stake full nodes outnumber existing Proof-of-Work full nodes by three-to-one. What is your choice?
I do not care or do not know enough
I would download and run the existing Proof-of-Work program to fight the change.
I would download and run a new Proof-of-Stake program to favor the change.

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Author Topic: Annual 10% bitcoin dividends if mining were Proof-of-Stake  (Read 16086 times)
Peter R
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April 27, 2014, 03:00:36 PM
 #261

I don't get why people are so prompt to make the analogy PoS=Fiat. In fiat people who vote (Central bankers) have divergent interest with fiat holders, they have no skin in the game. Whereas with PoS the interest of the decision makers are the same than the interest of holders.

Correct.  It is like a popular democracy where shares (money) can be created and destroyed based on popular opinion.  For example, SlipperySlope has a tricky decision to make: should he credit Satoshi with his estimated 1,000,000 shares and risk a dump of 8% of the outstanding bitshares?  Or should he redistribute them more "fairly"?

When I asked him about his policy on the redistribution of wealth, he said the following about the Satoshi coins:

The best case for redistribution to add to Satoshi's social contract would be to make permanent the up-to-now unspent coins that Satoshi mined while alpha testing the live chain.

I found it very interesting that SlipperySlope believes that Satoshi holds some sort of "social contract" with us not to spend his coins.  I disagree.  

What about the DPR seized coins?  Perhaps these should be redistributed for the "greater good" too?  And then perhaps it will become popular opinion that some whales have too many shares and it's unfair that the staking rewards flow in proportion to stake rather than work.  The bitshares community will claim that people should be rewarded for work, not for rent-seeking.  And then perhaps they will vote for some sort of progressive transfers of shares from these whales to projects for the betterment of humanity (the "greater good").

Bitcoins are very difficult to create for a reason.  


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rpietila
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April 27, 2014, 03:21:28 PM
 #262

What about the DPR seized coins?  Perhaps these should be redistributed for the "greater good" too?

Since PoS schemes aim to create value out of nothing (cf. alchemy), surely they can decide to exclude whatever entities from the nothing ahem. value distribution if they want. There is no social contract that forces the creators to give shares to anybody. Most altcoins only give shares to the creators themselves and exclude all the others.

If we are aiming to have another social engineering fiat experiment, do as you wish and don't be surprised if nobody wants to hold your paper except (max) at gunpoint, as is the case with national fiats.
Peter R
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April 27, 2014, 03:35:39 PM
 #263

What about the DPR seized coins?  Perhaps these should be redistributed for the "greater good" too?

Since PoS schemes aim to create value out of nothing (cf. alchemy), surely they can decide to exclude whatever entities from the nothing ahem. value distribution if they want. There is no social contract that forces the creators to give shares to anybody. Most altcoins only give shares to the creators themselves and exclude all the others.

If we are aiming to have another social engineering fiat experiment, do as you wish and don't be surprised if nobody wants to hold your paper except (max) at gunpoint, as is the case with national fiats.


Yes.  Thank you Risto.  It is clear to me that PoS is Fiat 2.0, but I think a lot of others here haven't had that epiphany yet.  

I actually hope SlipperySlope proceeds with his bitshares experiment.  It will be very interesting to see the dynamics that unfold.  If bitcoin holders believe in PoS, they should trade out of bitcoin and into SlipperySlope's bitshares as they could profit immensely should bitshares become dominant.  On the other hand, if they are wrong, then they will transfer some of their wealth to bitcoin holders.  SlipperySlope's experiment will give PoS supporters a chance to "put their money where their mouth is."


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Adrian-x
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April 27, 2014, 03:44:38 PM
 #264

Does proof of work have to be limited to computer calculations?
No it could be limited to IP address or any other computer operation (all can be digitally reproduced). Satoshi discussed it here on Bitcointalk and argued that it was the hardest process to fake, in that one had to invest economic resources to do it and in so doing that would introduced risk and competition and efficiency, optimizing the distributing of coins.

If you can do Proof of Storage that would be a more effective distribution method than PoS. Some proposals but not invented yet. CloudCoin comes to mind as 1 of 3 attempts I know of.


Would it be possible to tie Proof of Storage to a gps coordinate for example? If as a miner, I could register an IP address to a physical and known location, earning trust over time (it's centralization - but there could be competition, anyone can register w/gps and documented physical address depending on regulators or trust of your location by the outside world) then work could be defined as transporting to and from storage, getting resources to the most effective location, addressing. It seems to me that work might be defined as almost any human endeavor that can be agreed upon by the block chain. If there is litter on the ground, and that litter can somehow be identified as lost, and it is then registered that I've moved the litter to a waste receptacle, then I've proven work. To me, bitcoin is about rewarding more people for the work they do every day. There should at least be enough coins to measure every keystroke that has ever landed on the internet - if that makes any sense. Smiley

To me the problem is not about rewarding more people it's about distributing Bitcoin to more people. Satoshi came up with a market system to do it, one that is consistent with Adam Smith's description of why metals were mined and how metals came to hold value.

As for your solutions if you can come up with a distribution mechanism that is controlled by a trust free market system it would have value, IP address and GPS locations are easy to spoof and controlled by a central system not a trust free market system.

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April 27, 2014, 04:04:03 PM
 #265

What about the DPR seized coins?  Perhaps these should be redistributed for the "greater good" too?

Since PoS schemes aim to create value out of nothing (cf. alchemy)
Are you disputing the affirmation that value is derived from the usefulness of the network and therefore not from the cost of maintaining the network?
Adrian-x
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April 27, 2014, 04:33:52 PM
 #266

What about the DPR seized coins?  Perhaps these should be redistributed for the "greater good" too?

Since PoS schemes aim to create value out of nothing (cf. alchemy)
Are you disputing the affirmation that value is derived from the usefulness of the network and therefore not from the cost of maintaining the network?
No it's an affirmation that saving doesn't doesn't service the greater good,  the act of saving is risky one only saves if there is a future benefit, while one invests or spends one's savings for future benefits. With PoS saving are reward always.

Thank me in Bits 12MwnzxtprG2mHm3rKdgi7NmJKCypsMMQw
rpietila
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April 27, 2014, 04:38:24 PM
 #267

What about the DPR seized coins?  Perhaps these should be redistributed for the "greater good" too?

Since PoS schemes aim to create value out of nothing (cf. alchemy)
Are you disputing the affirmation that value is derived from the usefulness of the network and therefore not from the cost of maintaining the network?

No. I had a long treatise concerning this as my first post in the thread.

I dispute that the network can sustainably gain any value if the currency unit is created out of thin air.

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April 27, 2014, 04:40:27 PM
 #268

What about the DPR seized coins?  Perhaps these should be redistributed for the "greater good" too?

Since PoS schemes aim to create value out of nothing (cf. alchemy)
Are you disputing the affirmation that value is derived from the usefulness of the network and therefore not from the cost of maintaining the network?
No it's an affirmation that saving doesn't doesn't service the greater good,  the act of saving is risky one only saves if there is a future benefit, while one invests or spends one's savings for future benefits. With PoS saving are reward always.
It's like holding a share in a company. Dividends reward people who hold shares in companies who are profitable (ie. which resolve a problem in a efficient way).

Are you stating that shareholders shouldn't earn dividends?
benjyz
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April 27, 2014, 04:44:00 PM
 #269

this thread is very superficial. to begin with the mining subsidy decreases over time. It will half in 2017 to 4%.

a fork from Bitcoin to PoS will never happen. this just doesn't make sense.

if you want to create a new protocol you should learn the basics, otherwise nobody will take you seriously. and besides there several major issues with PoS. if you solve those, just start an altcoin and get rich. end of story.
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April 27, 2014, 04:45:30 PM
 #270

What about the DPR seized coins?  Perhaps these should be redistributed for the "greater good" too?

Since PoS schemes aim to create value out of nothing (cf. alchemy)
Are you disputing the affirmation that value is derived from the usefulness of the network and therefore not from the cost of maintaining the network?
No it's an affirmation that saving doesn't doesn't service the greater good,  the act of saving is risky one only saves if there is a future benefit, while one invests or spends one's savings for future benefits. With PoS saving are reward always.
It's like holding a share in a company. Dividends reward people who hold shares in companies who are profitable (ie. which resolve a problem in a efficient way).

Are you stating that shareholders shouldn't earn dividends?

How about you tell - do you think increasing the number of currency units (other things being equal) increases the market cap?

Answer is of course NO, but why is the whole thing then so important?
BldSwtTrs
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April 27, 2014, 04:45:58 PM
 #271

What about the DPR seized coins?  Perhaps these should be redistributed for the "greater good" too?

Since PoS schemes aim to create value out of nothing (cf. alchemy)
Are you disputing the affirmation that value is derived from the usefulness of the network and therefore not from the cost of maintaining the network?

No. I had a long treatise concerning this as my first post in the thread.

I dispute that the network can sustainably gain any value if the currency unit is created out of thin air.
PoS doesn't involve by itself creating new currency units.
Everybody imagine that should be the case because everybody are reasoning within the PoW paradigm which make necessary to create new units. But a PoS network can work fine without creating new units (see NXT and soon Bitshares X, or any brick and mortar corporation).
Adrian-x
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April 27, 2014, 04:46:22 PM
 #272

What about the DPR seized coins?  Perhaps these should be redistributed for the "greater good" too?

Since PoS schemes aim to create value out of nothing (cf. alchemy)
Are you disputing the affirmation that value is derived from the usefulness of the network and therefore not from the cost of maintaining the network?
No it's an affirmation that saving doesn't doesn't service the greater good,  the act of saving is risky one only saves if there is a future benefit, while one invests or spends one's savings for future benefits. With PoS saving are reward always.
It's like holding a share in a company. Dividends reward people who hold shares in companies who are profitable (ie. which resolve a problem in a efficient way).

Are you stating that shareholders shouldn't earn dividends?
In your example:
economy = company
shares = currently

The problem is the company needs the shareholders to give up there shares to do business.

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BldSwtTrs
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April 27, 2014, 04:59:11 PM
 #273

What about the DPR seized coins?  Perhaps these should be redistributed for the "greater good" too?

Since PoS schemes aim to create value out of nothing (cf. alchemy)
Are you disputing the affirmation that value is derived from the usefulness of the network and therefore not from the cost of maintaining the network?
No it's an affirmation that saving doesn't doesn't service the greater good,  the act of saving is risky one only saves if there is a future benefit, while one invests or spends one's savings for future benefits. With PoS saving are reward always.
It's like holding a share in a company. Dividends reward people who hold shares in companies who are profitable (ie. which resolve a problem in a efficient way).

Are you stating that shareholders shouldn't earn dividends?

How about you tell - do you think increasing the number of currency units (other things being equal) increases the market cap?

Answer is of course NO, but why is the whole thing then so important?
Of course not, money creation is a value transfer not a value creation.

This value transfer from holders to miners is necessary because miners are doing a service for the network. Holders pay this service by diluting their value via the inflation of the money supply.

But with PoS, holders can accomplish by themselves the very service the miners are doing. Therefore they no longer need to pay miners, they no longer need to see the money supply be inflated and diluting their value. The main point is that PoW is fundamentally inflationnist whereas PoS is truly deflationnist. If BTC-PoS would born tomorrow we can have a money supply which will be forever 12,7 millions BTC, instead of 21 millions with PoW.
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April 27, 2014, 05:24:27 PM
 #274

You are not making any sense. In your model, there is no work that the "PoS" does. So all coin creation serves only to inflate the value of all coins. Is there anyone in the thread who knows what he is talking or do I have to conclude that all "PoS" is smoke and mirrors?
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April 27, 2014, 05:29:14 PM
 #275

You are not making any sense. In your model, there is no work that the "PoS" does. So all coin creation serves only to inflate the value of all coins. Is there anyone in the thread who knows what he is talking or do I have to conclude that all "PoS" is smoke and mirrors?
In my model there is no coin creation. Before you insult me please read what I write.
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April 27, 2014, 05:37:31 PM
 #276

The main argument you've been proposing and I've been attacking is the blessing of new coins given to existing holders.

If there is something more to it, please bring it to the table.
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April 27, 2014, 05:49:13 PM
Last edit: April 27, 2014, 06:07:55 PM by BldSwtTrs
 #277

The main argument you've been proposing and I've been attacking is the blessing of new coins given to existing holders.

If there is something more to it, please bring it to the table.
Well I already said 4 or 5 times in this thread that with PoS new coins/currency units don't need to be create, therefore existing holders would no be blessed with new currency units.

You can either fixed completly the money supply (1) or destroying the money supply as transaction fees (2).

Both with (1) and (2) nobody wins more coins and the money supply never increase. In (1) holders' stake as a proportion to the total money supply is forever fixed, in (2) holders' stake as a proportion to the total money supply increase over time due to the destruction of the money supply, economically this is equivalent to a dividends/shares buyback.
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April 27, 2014, 06:09:14 PM
 #278

Yes. I see. So this brings us to the problem of how to create the monetary base then?

- Loan it into existence (current fiat banking system). Most evil and insidious way that indebts and consequently enslaves most everyone.
- Create it out of thin air and give to the early adopters/whoever (premine). Unfair, uneconomical and does not work in practice.
- Mine it, with each unit of currency created against an equal value of real resources wasted (Bitcoin).
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April 27, 2014, 06:13:20 PM
 #279

Yes. I see. So this brings us to the problem of how to create the monetary base then?

- Loan it into existence (current fiat banking system). Most evil and insidious way that indebts and consequently enslaves most everyone.
- Create it out of thin air and give to the early adopters/whoever (premine). Unfair, uneconomical and does not work in practice.
- Mine it, with each unit of currency created against an equal value of real resources wasted (Bitcoin).
-Airdrop it to current BTC holders

(Peter R's spinoff proposition, which is awesome imho).
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April 27, 2014, 06:16:18 PM
 #280

Yes. I see. So this brings us to the problem of how to create the monetary base then?

- Loan it into existence (current fiat banking system). Most evil and insidious way that indebts and consequently enslaves most everyone.
- Create it out of thin air and give to the early adopters/whoever (premine). Unfair, uneconomical and does not work in practice.
- Mine it, with each unit of currency created against an equal value of real resources wasted (Bitcoin).
-Airdrop it to current BTC holders

(Peter R's spinoff proposition, which is awesome imho).

Yes, I also think it is very nice. The debate whether to steal somebody's share in the process is also very interesting and reveals much of the designers. (Not taking sides though).

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