Annual 10% bitcoin dividends if mining were Proof-of-Stake

[BitDreams]

I am postponing my artificial general intelligence R&D for the duration of the Bitcoin proof-of-stake project, which should succeed or fail in 2016.  I believe in the concept of the Technological Singularity, and indeed Bitcoin is a milestone along that path.

AI without bitcoin might be like an automobile without fuel. AI should eventually become the worlds largest employer.

http://www.wired.com/business/2014/02/rise-fall-rise-patrick-byrne/
When I toss that idea at Byrne, he tells me that he’s already thought of it, that it could prevent an entire ecosystem of funds and banks from gaming the market. “It’s like you’re reading my mind,” he says. “You would have an instant, frictionless market, while having the added benefit of wiping out a whole parasitic class of society — that is, the whole financial industry.”

Regarding Patrick Byrne's quote above, I can't think of a more appropriate place for job automation to focus (financial/insurance industry).

[Motorsports]

10% POS is good idea. When will it be added?

[jonald_fyookball]

10% POS is good idea. When will it be added?

It probably won't be anytime soon. 

You might wanna read the last 20 pages and countless other discussion
threads about Proof of Stake.

[SlipperySlope]

If logic and theory is his weakness, does that mean that your ignorance is strength?

If we need regulation, force and control to stop destructive behaviour, does that mean that war is peace?

If we need government to control our lives to protect our freedom, does that mean that freedom is slavery?


In addition to proof-of-work making it difficult to create new coins, I realized today that it also makes it extremely difficult to re-write history.  On the other hand, since no work is required in proof-of-stake (just enough voting power), history can be re-written cheaply and insidiously.  

The quality of writing on this thread amazes me.

[jonald_fyookball]

If logic and theory is his weakness, does that mean that your ignorance is strength?

If we need regulation, force and control to stop destructive behaviour, does that mean that war is peace?

If we need government to control our lives to protect our freedom, does that mean that freedom is slavery?


In addition to proof-of-work making it difficult to create new coins, I realized today that it also makes it extremely difficult to re-write history.  On the other hand, since no work is required in proof-of-stake (just enough voting power), history can be re-written cheaply and insidiously.  

The quality of writing on this thread amazes me.

Sometimes being a bitcoiner makes me feel like an intellectual/scholar lol.

[SlipperySlope]

The quality of writing on this thread amazes me.

Sometimes being a bitcoiner makes me feel like an intellectual/scholar lol.

I think it is simply engaging our wits to persuade each other and to learn. When I read what you write, I think about it, and maybe a few hours later, I think some more.

And when I read Peter_R's comments, I did not exactly laugh out loud, rather I grunted. I studied the book he mentioned before the date of the title. It was then, and remains to this day, a devastating critique of totalitarianism and linguistic legerdemain. Each of those phrases I had forgotten four decades ago - and he brought them back to life.

[SlipperySlope]

Here is the earliest reference that I could find to proof-of-stake, using the search tool of this forum. Care to comment here?

My own first thought is that because non-standard transactions do not become part of the permanent record, I would seek a different means of recording the vote . . .

I've got an idea, and I'm wondering if it's been discussed/ripped apart here yet:

I'm wondering if as bitcoins become more widely distributed, whether a transition from a proof of work based system to a proof of stake one might happen.  What I mean by proof of stake is that instead of your "vote" on the accepted transaction history being weighted by the share of computing resources you bring to the network, it's weighted by the number of bitcoins you can prove you own, using your private keys.

For those that don't want to be actively verifying transactions, and so that not all private keys need to be facing the network, votes could be delegated to other addresses via some kind of nonstandard Bitcoin transaction.  In this way, voting power would accumulate with trusted delegates instead of miners.  New bitcoins and transaction fees could be randomly and periodically distributed to delgates, weighted by the number of votes they've accumulated, thereby incentivising diversity of the delegates and direct voters.

If the implementation could be done, it proved to maintain at least a similar level of privacy and trustworthiness, and it only minimally complicated the UX, I'm thinking that a proof of stake based fork could out-compete a proof of work one due to much lower transaction fees, since its network wouldn't need to support the cost of the miners' computing resources.  (Note that the vote delegation scheme has bandwith/storage overhead that would offset these savings by some amount which would hopefully be relatively small.)

Some other potential improvements this system could offer:

• Possibly quicker, more definite confirmation of transactions, depending on how it can be implemented.
  
• The "voting power" may be more trustworty, since it would accumulate in a bottom-up fashion via a network of trust, instead of in the somewhat arbitrary way it accumulates now.  (Note the potential problem of vote-buying here.)
• It would remove the physical point of failure of bitcoin mining equipment, which can be confiscated or made illegal to run.
• It could be used to provide stakeholders a means of making their voices heard (via the delegated voting system it establishes) when it comes to proposals for software updates and protocol changes.

Anyway, I just wanted to throw the idea out here to see if there are any obvious reasons why it couldn't be implemented, and to hopefully spark a discussion amongst those better qualified than me.

Cheers.

[jonald_fyookball]

The quality of writing on this thread amazes me.

Sometimes being a bitcoiner makes me feel like an intellectual/scholar lol.

I think it is simply engaging our wits to persuade each other and to learn.

There is something exciting about it, given the presumably historic nature of cryptocurrencies, and the multifaceted complexity of the discussions that encompass everything from politics to economics to psychology, marketing, probability, cryptography, software, hardware, and many other things.

[SlipperySlope]

Another goodie from the original proof-of-stake thread, in which Mike Hearn talks about forking the blockchain and running experiments. That is my plan for 2015.

By the way, if you're interested in delegated voting, I wrote a paper on using it in a democracy some time ago:

  https://docs.google.com/document/pub?id=1jidmNJHWAtsPLCUD7EPPm8jOEV93kSXbZOMycqCWOyA

I think delegating voting is a great idea. I'm less convinced that it would work for replacing hashing in the block chain, but it might.

Some more problems for you to consider:

• If I control a key with 10 delegators, then I spend that key to 10 new keys, what happens to the delegations? Does it make sense for a key to have fan-out (ie 1 key to delegate to 10 other keys)? Do you split the value evenly or not?
• How do you efficiently detect and resolve delegation loops? ie, key A delegates to B, B delegates to C and C then delegates to A? You have to do this efficiently because otherwise setting up new delegations is a way to DoS the system. Note that detecting cycles in a large graph is slow, Tarjans algorithm is O(number of edges). If each key in the system takes part then every new address in the system potentially makes setting up new delegations harder. As the number of keys in the system grows without bound over time, that could be an issue
• Keys are owned by end users who may or may not know/care about the inner workings of their currency. How do you get new users to delegate appropriately?

It should be possible to run a parallel block chain based on proof-by-stake, but using the same transactions. It could be done with an adapted Bitcoin software. Once such a chain was up and running you could compare the results vs the existing chain.

I don't have the time/energy to do this myself.

[toast]

Sounds a bit like DPOS, except that has no re-delegation
http://bitshares.org/security/delegated-proof-of-stake.php

[mgburks77]

[There is] No such thing as inherent rights or free markets. The inclusion of idealistic abstractions into your theorizing is it's weak point IMHO.

If logic and theory is his weakness, does that mean that your ignorance is strength?

The idea that an economy cannot be measured or controlled is nothing more than a pretext for non-regulation of destructive economic behavior. These types of destructive behaviors can emerge in any ideological format, if there is no social pressure to inhibit them.

If we need regulation, force and control to stop destructive behaviour, does that mean that war is peace?

Governments are not the main entity that individuals need to protect themselves from. There are economic entities that are far more powerful and suppressive than any government. Government is merely the interface between these entities and the populace.  

If we need government to control our lives to protect our freedom, does that mean that freedom is slavery?


The three phrases in bold come from George Orwell's novel 1984.  In fact, they are the chapter titles of the fictitious book The Theory and Practice of Oligarchical Collectivism used by the Inner Party in Orwell's plot line.  Apparently, this book describes how the Inner Circle promotes "doublethink" to keep the outer party and the proles under control.  Doublethink is the act of ordinary people simultaneously accepting two mutually contradictory beliefs as correct.

I thought it was revealing that the protagonist in 1984, Winston Smith, worked at the Records Department of the Ministry of Truth, and each day he would re-write history to to reflect the "new reality" as dictated by the Inner Party.  What was key to the Inner Party's power was that history was easy to re-write (and it was Winston's job to assist each day in this process).  

In addition to proof-of-work making it difficult to create new coins, I realized today that it also makes it extremely difficult to re-write history.  On the other hand, since no work is required in proof-of-stake (just enough voting power), history can be re-written cheaply and insidiously.

This spiel is ridiculous, I never endorsed government in any way, in fact I'm an anarchist that is pointing out how western civilization is being moved toward the outcome in the novel you reference. We've never been closer to that than we are currently
 

I pointed out that governmental entities are not the only ones that engage in destructive "collective" economic behavior and that government is really the interface between corporate power and the population. The real power is behind the government.

Does your distaste for collectivism extend to collective investment by banking cartels and the like? This sector reaps far more government fat that what you seem to be concerned about going to help people that need help because of the neglected state of our society due outright rapine conducted by the corporate sector which has literally destroyed the middle class and working class in this country . Getting rid of government inference in your life is fine and dandy but realistically for that to happen you are going to have to get rid the undue influence over the infrastructure of society itself that is held by a handful of powerful financial and commercial cartels.

That's who is controlling society, government is just one of the tools they use to do it. They also control the content of your education, what you watch on TV, your food and medicine, and even engineered the moral precepts that guide our lives. Political choice in this society is limited to a false dichotomy staged between two pre-determined outcomes represented by two corrupt political parties that are both beholden to the interest I mentioned earlier.

You should check this documentary out:
https://www.youtube.com/watch?v=PQhEBCWMe44

It shows how nearly all aspects of our society are controlled by a pervasive media influence that infiltrates all aspects of life in our society. The ideas of men like Skinner, Lippman, Bernays, Cameron, and Freud are being used not to create a society better suited for humanity but to re-engineer humanity into a form better suited to being a cog in a mechanized, monetized society.  

If you are truly interested in resolving the tension between social needs and the needs of the individual and maximizing individual autonomy and conceiving a free society there are far better alternatives than fringe conceptions such as objectivism, which is no more than sophistry that leaves humanity chained to a engine of mechanized production that they have no control whatsoever over.  

[jonald_fyookball]

If you are truly interested in resolving the tension between social needs and the needs of the individual and maximizing individual autonomy and conceiving a free society there are far better alternatives than fringe conceptions such as objectivism, which is no more than sophistry that leaves humanity chained to a engine of mechanized production that they have no control whatsoever over.  

As long as we're way off topic...

I don't agree at all with this statement. 
Objectivism is a philosophy more honest than most.

Although the higher, spiritual non-linear realities are
beyond its scope, it's epistemology is clear and
straightforward.

[mgburks77]

Ayn Rand would spin in her grave to hear her ideas spun into a religion. Objectivism is a materialist conception.

That much I agree with her about ha ha

[cbeast]

Ayn Rand would spin in her grave to hear her ideas spun into a religion. Objectivism is a materialist conception.

That much I agree with her about ha ha

It's not all that objective. It's more like Objectiveology now.

[mgburks77]

Ayn Rand would spin in her grave to hear her ideas spun into a religion. Objectivism is a materialist conception.

That much I agree with her about ha ha

It's not all that objective. It's more like Objectiveology now.

ha ha ha
 

good one

[C.Steven]

I got a question here.
Can bitcoin really switch to PoS? Wouldn't it just create a hard fork and create a new altcoin?

[jonald_fyookball]

Can bitcoin really switch to PoS?

No.

Wouldn't it just create a hard fork and create a new altcoin?

Yes.

[C.Steven]

Can bitcoin really switch to PoS?

No.

Wouldn't it just create a hard fork and create a new altcoin?

Yes.

I see. Thanks for your help.
Looks like bitcoin is too-big-to-modify, unlike those new altcoins lol.

[MegaHustlr]

Bitcoin should NEVER HAVE ANY BIG changes made to it due to the risk of something bad taking place. Its fine how it is.

[SlipperySlope]

I got a question here.
Can bitcoin really switch to PoS? Wouldn't it just create a hard fork and create a new altcoin?

The Bitcoin brand is not an enforced trademark and the core developers have a policy of neutrality with regard to controversy. My project, to be deployed at the beginning of 2016 after a year of public testing and scrutiny, will use the then-current blockchain as the initial distribution. The new version will exchange transactions with the old version on the existing network. Both versions will reject any transactions tainted by rewards created by the other version after the hard-fork date.

I need at least a three to one advantage with regard to peer full nodes on my version. For proof-of-stake to work I need the cooperation of the largest holders. I need the cooperation of transactors such as third-party wallet providers, hosted wallet providers, and nearly all the major exchanges. One or more transitional SHA-256 multipools will provide untainted bitcoin for its participating ASIC miners. During the year of testing, the project open source will be provided to at least one altcoin already in circulation.

There will be three prices for bitcoin after the hard-fork. The main price will be for untainted coins mined before the hard-fork. The second price will be for coins tainted by proof-of-work rewards issued after the hard-fork. The third price will be for coins tainted by proof-of-stake rewards issued after the hard-fork. I expect selling pressure on the tainted proof-of-work coins as ASIC miners necessarily must sell to buy equipment and purchase power.

The new version will be have the features, to attract the needed majority . . .

• immediate transaction acknowledgment for incorporation into the blockchain, which is checkpointed every 10 minutes following the new block
• mining rewards distributed via pools in proportion to provided stakes
• transactions will be included that have lower fees than present and no-fee transactions will be much more likely to be accepted
• only one version of the blockchain exists, has broad consensus approval and is widely replicated
• network cryptographic audit trail

The consensus of users, as designed by Satoshi, will pick the winner. Unless the odds beforehand are very much in this project's favor, the hard-fork will not occur as fragmentation of the system hurts us all. Yet the wastefulness of the current system compels a timely solution.

A project whitepaper is the first step to gaining the required expert support, and I am gathering my thoughts in preparation for writing it.

Bitcoin Proof-of-Stake