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Author Topic: For Any Litecoiners Considering Switching Because of the Recent 51% Scare...  (Read 884 times)
Sentinelrv
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May 21, 2014, 09:18:16 PM
 #1

NOTE: First of all, I'm not interested in getting into a debate or a flame war about this. I'm only posting this because somebody from Litecoin posted this today on our subreddit http://www.reddit.com/r/peercoin/comments/2659lz/im_done_with_ltc/ and I felt there might be more people out there looking for information, so I'm addressing them and only them here. If you don't like what I'm saying here then please just let the thread sink.
---

Now, if there are anymore Litecoiners who are not interested in being around to see a repeat of the 51% hysteria shown in the following image, maybe you should consider learning about how Peercoin (The #3 Crypto) prevents the centralization of its network. I wanted to provide people that are seriously interested a resource to learn more. It's a conference presentation we designed for speeches and it visualizes many of the concepts we talk about to make it easier to understand. You can check it out here...

Find out how Peercoin prevents the centralization of its network:
http://imgur.com/a/dG66c

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Yurizhai
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May 21, 2014, 10:03:05 PM
 #2

More and more coins are adopting proof-of-stake, the technology will only improve over time.
Sentinelrv
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May 21, 2014, 10:09:24 PM
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More and more coins are adopting proof-of-stake, the technology will only improve over time.

Also of note is the fact that Peercoin was the ORIGINAL implementation of proof-of-stake and has proven itself to be stable and reliable for almost 2 years now. It has a visionary developer in Sunny King and an expanding team. Not to mention Peershares, which will revolutionize fundraising and equity management....

"Peershares are a way for businesses to raise funds by issuing shares to the public and managing them in a decentralized fashion. It uses the Peercoin network to automate the distribution of associated dividends in the form of Peercoins."
kschneezy
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May 21, 2014, 10:47:18 PM
 #4

I sold all my litecoins for peercoins a while back. Have to be forward thinking
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May 21, 2014, 11:07:34 PM
 #5

Sold all my peercoin and XPM awhile back when realised they weren't goin anywhere, especially because of the primecoin incident  Wink
Sentinelrv
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May 21, 2014, 11:09:23 PM
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Sold all my peercoin and XPM awhile back when realised they weren't goin anywhere, especially because of the primecoin incident  Wink


The Primecoin incident? Whatever that is, I'm not talking about Primecoin here. Most of the development is in Peercoin.
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May 21, 2014, 11:11:45 PM
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Sold all my peercoin and XPM awhile back when realised they weren't goin anywhere, especially because of the primecoin incident  Wink


The Primecoin incident? Whatever that is, I'm not talking about Primecoin here. Most of the development is in Peercoin.

Same dev Smiley though, thats whats scary, I know how XPM started so peercoin...hmmm
PolarPoint
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May 21, 2014, 11:16:19 PM
 #8

According to this site https://www.litecoinpool.org/pools, coinotron only has 39%. They need to unite with wemineltc to get over 50%. Is that site not accurate, or am I missing something?
Yurizhai
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May 21, 2014, 11:21:45 PM
 #9

Accordi to this site https://www.litecoinpool.org/pools, coinotron only has 39%. They need to unite with wemineltc to get over 50%. Is that site not accurate, or am I missing something?

This little mini crisis happened yesterday.
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May 21, 2014, 11:40:41 PM
 #10

Sold all my peercoin and XPM awhile back when realised they weren't goin anywhere, especially because of the primecoin incident  Wink

what incident?

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Sentinelrv
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May 22, 2014, 12:05:42 AM
 #11

Accordi to this site https://www.litecoinpool.org/pools, coinotron only has 39%. They need to unite with wemineltc to get over 50%. Is that site not accurate, or am I missing something?

This little mini crisis happened yesterday.

And if it happened once, it can happen again. If Litecoin's only defense against this is to warn people through social media to leave a specific pool, they need a new plan. The system should be designed around human nature to prevent such events from occurring in the first place. Nobody should have to put trust in the good will of miners to know when to stop earning money and leave the pool.
El Dude
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May 22, 2014, 02:07:40 AM
 #12

No thanks bitcoin had this scare a while back and I didn't leave bitcoin.

Bitcoin and Litecoin hodler
Anotheranonlol
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May 22, 2014, 02:17:51 AM
 #13

Litecoin offers NO tangible benefit to cryptocurrency community and only serves as a $300 million dollar dilution/distraction from bitcoin now that it's failed at's it original purpose (ASIC resistance) Peercoin, or in fact any coin with something unique to offer would be a better choice as number 2 spot.

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May 22, 2014, 02:26:16 AM
 #14

I don't see that much difference between LTC and BTC.  LTC has 4x faster block production and therefor, if LTC were as successful as BTC then LTC would arrive at blockchain bloat problems about 4 times sooner.  LTC has a different Proof of Work scheme but it is still PoW and so suffers from the originally unanticipated but inevitable centralization of power into a very few miners and even fewer mining pool managers.  

Bitcoin and Litecoin are a grand experiment. A spectacular breakthrough for censor resistant cryptomoney. But they are in fact the first prototype.  They are version 1.  

The second prototype is more advanced.  It builds on the great advances of the Bitcoin breakthroughs, but corrects and improves on at least one major weakness: the inherently centralizing nature of Proof of Work.  This improved version employs Proof of Stake.

Of the variety of new Proof of Stake coins, I personally have gone nearly 100% into Peercoin.  It is far and away the most time proven crypto in the Proof of Stake world.

Peercoin builds on Bitcoin as does Litecoin.  When the deep developer pool of Bitcoin makes protocol improvements: Litecoin and Peercoin can both incorporate these core protocol improvements.  

But Peercoin has the advantage that it does not suffer the downsides of Proof of Work.
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May 22, 2014, 02:44:33 AM
 #15

Accordi to this site https://www.litecoinpool.org/pools, coinotron only has 39%. They need to unite with wemineltc to get over 50%. Is that site not accurate, or am I missing something?

This little mini crisis happened yesterday.

And if it happened once, it can happen again. If Litecoin's only defense against this is to warn people through social media to leave a specific pool, they need a new plan. The system should be designed around human nature to prevent such events from occurring in the first place. Nobody should have to put trust in the good will of miners to know when to stop earning money and leave the pool.

Peercoin uses centrally broadcast checkpoints to secure the network from the "nothing at risk" problem inherent in PoS?  You talk about trust but the entire decentralized network works only with implicit trust in the developer.  If the developer (by coercion, threat of violence, or for his own personal gain) broadcast checkpoints which supports a shorter chain all clients would jump to that chain immediately.

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May 22, 2014, 03:25:16 AM
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Peercoin uses centrally broadcast checkpoints to secure the network from the "nothing at risk" problem inherent in PoS?  You talk about trust but the entire decentralized network works only with implicit trust in the developer.  If the developer (by coercion, threat of violence, or for his own personal gain) broadcast checkpoints which supports a shorter chain all clients would jump to that chain immediately.

If I've understood your previous positions on the matter, correctly, is it safe to say that you feel that checkpoints aren't inherently a bad thing, but if those checkpoints are "real-time," vs. reactionary (for security), that's when it crosses the line?

For the typical user of cryptocurrencies today, and into the future, the "implicit trust in the developer" may be enough. There are a very small number of people in the World that actually understand how this all works -- if it looks like it's a good idea, people will gravitate to it. Do you know how your bank's back-end system is set up? Do you trust that it works?

I agree with you that a World without checkpoints would be infinitely better than a World with them, but all things considered, if they are a concern for Peercoin, it only should follow that they are a concern (though maybe slightly less) for Bitcoin, right?
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May 22, 2014, 03:35:08 AM
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I agree with you that a World without checkpoints would be infinitely better than a World with them, but all things considered, if they are a concern for Peercoin, it only should follow that they are a concern (though maybe slightly less) for Bitcoin, right?

You are right the same centralization risks apply to Bitcoin or any software project.  The key difference is the level of control and the value of seizing that control.  Developers could be forced to make malicious changes to the client but those changes, have the potential to be detected by other developers.  As much as possible client development is an open transparent process (deterministic build process and multiple developer signatures).  A single wary developer could alert the entire community.  Users can choose to delay upgrading their clients, and the network doesn't consist of a single version of a single client.  No major client support auto updating to make malicious code injection more difficult.  The window for detection is longer.  

If the Peercoin checkpoint keys were compromised an attack would occur instantly, without any window for detection.  You would have a transaction with a lot of confirmations and then the network would receive a checkpoint update and your node (along with every other node) would jump to another chain.  If you were double spent on that chain, your coins would simply disappear.  It doesn't matter if you are online or offline, how closely you monitor the code, or if you prudently wait to upgrade.  It would be very similar to a 51% attack except the attacker could perform this attack without a majority of the hashrate and/or stake.  The checkpoint authority (in the hands of a single person) has "veto" power over the network.   

You need to trust more than just that the developer won't be directly malicious.  For the record I don't think he will be, but he may not have a choice.  If a criminal organization (or three letter agency) held a gun to the head of the developer (or maybe to the head of a loved one would be more effective) do you still trust him to not checkpoint a chain containing double spends?  If someone tortured him how long could he hold out before he gave up control of the keys which sign the checkpoints?   If you think these types of scenarios are James Bondish now, well what about when the coin supply is valued in the billions of dollars? Tens of billions? Hundreds of billion?   The only confirmed transaction is one that is behind the last checkpoint.  Centralized security is easy.  It is decentralized security that is hard.  A decentralized network which relies on centralized security is an oxymoron.

While Bitcoin and Peercoin both use checkpoints they don't serve the same purpose.   Bitcoin doesn't use checkpoints to prevent reorgs and thus the security model doesn't depend on them.  I guess you didn't see the humor in the fact that the OP was so worried that a pool (consisting of thousands of miners) had 51% of the hashrate so the obvious solution was to jump to a coin where a single person has control over 100% of the checkpoints.
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May 22, 2014, 10:02:35 AM
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There were two ideas for how proof of stake might actually be able to be properly done but neither have actually ever been implemented, possibly because people were more interested in spewing out scamcoins than in actually implementing something that might work.

The scammers apparently prefer to keep spewing out solidcoin style (privileged node) ppcoin clones than to actually try one of the methods that over long time of lots of thrashing at all kinds of details apparently seemed like they might potentially actually turn out to be workable.

I don't know if either actually will turn out to be workable though.

So basically proof of stake so far is just another bunch of solidcoin style scams known from the start not to be secure.

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May 22, 2014, 06:34:42 PM
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I agree with you that a World without checkpoints would be infinitely better than a World with them, but all things considered, if they are a concern for Peercoin, it only should follow that they are a concern (though maybe slightly less) for Bitcoin, right?

You are right the same centralization risks apply to Bitcoin or any software project.  The key difference is the level of control and the value of seizing that control.  Developers could be forced to make malicious changes to the client but those changes, have the potential to be detected by other developers.  As much as possible client development is an open transparent process (deterministic build process and multiple developer signatures).  A single wary developer could alert the entire community.  Users can choose to delay upgrading their clients, and the network doesn't consist of a single version of a single client.  No major client support auto updating to make malicious code injection more difficult.  The window for detection is longer.  

If the Peercoin checkpoint keys were compromised an attack would occur instantly, without any window for detection.  You would have a transaction with a lot of confirmations and then the network would receive a checkpoint update and your node (along with every other node) would jump to another chain.  If you were double spent on that chain, your coins would simply disappear.  It doesn't matter if you are online or offline, how closely you monitor the code, or if you prudently wait to upgrade.  It would be very similar to a 51% attack except the attacker could perform this attack without a majority of the hashrate and/or stake.  The checkpoint authority (in the hands of a single person) has "veto" power over the network.   

You need to trust more than just that the developer won't be directly malicious.  For the record I don't think he will be, but he may not have a choice.  If a criminal organization (or three letter agency) held a gun to the head of the developer (or maybe to the head of a loved one would be more effective) do you still trust him to not checkpoint a chain containing double spends?  If someone tortured him how long could he hold out before he gave up control of the keys which sign the checkpoints?   If you think these types of scenarios are James Bondish now, well what about when the coin supply is valued in the billions of dollars? Tens of billions? Hundreds of billion?   The only confirmed transaction is one that is behind the last checkpoint.  Centralized security is easy.  It is decentralized security that is hard.  A decentralized network which relies on centralized security is an oxymoron.

While Bitcoin and Peercoin both use checkpoints they don't serve the same purpose.   Bitcoin doesn't use checkpoints to prevent reorgs and thus the security model doesn't depend on them.  I guess you didn't see the humor in the fact that the OP was so worried that a pool (consisting of thousands of miners) had 51% of the hashrate so the obvious solution was to jump to a coin where a single person has control over 100% of the checkpoints.

Very interesting! I am looking for a document(s) that outlines the workings of the bitcoin code & netwerk and possibly the issues that came in its wake. I would like to avoid reading all the code at this point. Does documentation like this exist or do I need to scavenge the internet for all the bits and pieces?
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