Is PoS dead?

[cbeast]

Vitalik Buterin of Ethereum and winner of the Peter Thiel fellowship award ($100k) has an interesting blogpost where he discusses the merits of PoW versus PoS.

Check it out here, https://blog.ethereum.org/2014/07/05/stake/

He points out Daniel Larimer's TaPos as a promising alternative to PoW.
Daniel Larimer recently improved the idea and developed DPOS, illustrated above.

This is a kludge. He's trying to solve a complex problem with an even more complex solution. These issues can be done with layers on top of Bitcoin. We don't need to solve all the world's problems today, even if an engineer thinks he can do so. I would really prefer if our best theoreticians and programmers were working on Bitcoin and Colored Coin.

Now, having said that, I think it's a great idea to try. There is plenty of room for many more cryptocurrencies.

That's a good attitude. What do you think about this quote that it might be a good thing to have different chains having separate fates?

Piling every proof-of-work quorum system in the world into one dataset doesn't scale.

Bitcoin and BitDNS can be used separately.  Users shouldn't have to download all of both to use one or the other.  BitDNS users may not want to download everything the next several unrelated networks decide to pile in either.

The networks need to have separate fates.  BitDNS users might be completely liberal about adding any large data features since relatively few domain registrars are needed, while Bitcoin users might get increasingly tyrannical about limiting the size of the chain so it's easy for lots of users and small devices.

I see this as a sociological issue "getting increasingly tyrannical" and such. This is why I see Bitcoin itself becoming the de facto reserve currency, and not so much a local one. The blockchain will be constrained by miners by simply making the fees exorbitant for local users. My father used to say "Price, Quality, Service. Pick any two if you want to stay in business."

Bitcoin is the DNA building blocks that can be fashioned into things that are wondrous and monstrous. I suspect the nations and states will choose an alternate cryptocurrency or derivative coin that best serves its political ideologies, but if they want to play the global economics game, they will use bitcoins.

[devphp]

Vitalik Buterin of Ethereum and winner of the Peter Thiel fellowship award ($100k) has an interesting blogpost where he discusses the merits of PoW versus PoS.

Check it out here, https://blog.ethereum.org/2014/07/05/stake/

He points out Daniel Larimer's TaPos as a promising alternative to PoW.
Daniel Larimer recently improved the idea and developed DPOS, illustrated above.

Vitalik joined NXT forum to discuss the nothing-at-stake issue:
https://nxtforum.org/index.php?topic=3343.msg60114#msg60114

[Aricoin_Mike]

pos/pow hybrid could be best.

I think pos only is the way to go. Why complicate if you can make it simple?

[ChuckOne]

@CLains

Each idea of DPoS is already implemented or will be implemented in the near future.

[CLains]

Vitalik Buterin of Ethereum and winner of the Peter Thiel fellowship award ($100k) has an interesting blogpost where he discusses the merits of PoW versus PoS.

Check it out here, https://blog.ethereum.org/2014/07/05/stake/

He points out Daniel Larimer's TaPos as a promising alternative to PoW.
Daniel Larimer recently improved the idea and developed DPOS, illustrated above.

This is a kludge. He's trying to solve a complex problem with an even more complex solution. These issues can be done with layers on top of Bitcoin. We don't need to solve all the world's problems today, even if an engineer thinks he can do so. I would really prefer if our best theoreticians and programmers were working on Bitcoin and Colored Coin.

Now, having said that, I think it's a great idea to try. There is plenty of room for many more cryptocurrencies.

That's a good attitude. What do you think about this quote that it might be a good thing to have different chains having separate fates?

Piling every proof-of-work quorum system in the world into one dataset doesn't scale.

Bitcoin and BitDNS can be used separately.  Users shouldn't have to download all of both to use one or the other.  BitDNS users may not want to download everything the next several unrelated networks decide to pile in either.

The networks need to have separate fates.  BitDNS users might be completely liberal about adding any large data features since relatively few domain registrars are needed, while Bitcoin users might get increasingly tyrannical about limiting the size of the chain so it's easy for lots of users and small devices.

I see this as a sociological issue "getting increasingly tyrannical" and such. This is why I see Bitcoin itself becoming the de facto reserve currency, and not so much a local one. The blockchain will be constrained by miners by simply making the fees exorbitant for local users. My father used to say "Price, Quality, Service. Pick any two if you want to stay in business."

Bitcoin is the DNA building blocks that can be fashioned into things that are wondrous and monstrous. I suspect the nations and states will choose an alternate cryptocurrency or derivative coin that best serves its political ideologies, but if they want to play the global economics game, they will use bitcoins.

Agree with most of this. It really is a sociological issue to some extent. We can't forget the IRL context of the blockchain. It's an interesting idea that one has to pick two out the three, price, quality and service - have really never thought about it that way, but when you point it out I sure see a lot of successful products following that 2/3 rule

[dwma]

IMO this thread should be re-titled "Is POW dead for new currencies ?".  Bitcoin isn't changing anytime soon, but it is hard to see why a currency developer would choose POW at this point.

[coine_smithe]

https://bitcointalk.org/index.php?topic=584719.140

Here someone is trying to solve the attack vectors of proof of stake.

If we can just make it more decentralized then it will be better than proof of work hands down, in my opinion. The dev can't have checkpoint control, and there needs to be a requirement similar to PoW where 51% of the nodes must accept a new fork for a fork to happen. Once PoS is equal to PoW in that regard then the system can become decentralized and autonomous.

PoS has problems but it is far from dead. In fact, in may be the future of decentralized currencies.

[bubble83]

https://bitcointalk.org/index.php?topic=584719.140

Here someone is trying to solve the attack vectors of proof of stake.

If we can just make it more decentralized then it will be better than proof of work hands down, in my opinion. The dev can't have checkpoint control, and there needs to be a requirement similar to PoW where 51% of the nodes must accept a new fork for a fork to happen. Once PoS is equal to PoW in that regard then the system can become decentralized and autonomous.

PoS has problems but it is far from dead. In fact, in may be the future of decentralized currencies.

I would like to see a beta of this up and running. Whatever he's creating is definitely not a bog standard shit coin, it's next generation stuff.

[ArticMine]

The problem with proof of stake is that stake in the coin does not equal exposure to the coin if a derivatives market in the coin exists. I explained this attack in this post and the subsequent discussion. https://bitcointalk.org/index.php?topic=694436.msg7946409#msg7946409 Basically one hedges one's stake in the coin by taking an equivalent short position in the derivatives market to create zero net exposure to the coin in order to launch the attack.

[DeathAndTaxes]

The problem with proof of stake is that stake in the coin does not equal exposure to the coin if a derivatives market in the coin exists. I explained this attack in this post and the subsequent discussion. https://bitcointalk.org/index.php?topic=694436.msg7946409#msg7946409 Basically one hedges one's stake in the coin by taking an equivalent short position in the derivatives market to create zero net exposure to the coin in order to launch the attack.

You don't even need a derivative market (although that is another way to leverage the nothing at stake problem).  You have some coins in block x, you sell the coins, you now have nothing however you can re-org the chain back from block x.  Why?  Although you have nothing "now" in the past back at block x you did have something.  You are attacking with the "memory" or history of coins.

[ArticMine]

The problem with proof of stake is that stake in the coin does not equal exposure to the coin if a derivatives market in the coin exists. I explained this attack in this post and the subsequent discussion. https://bitcointalk.org/index.php?topic=694436.msg7946409#msg7946409 Basically one hedges one's stake in the coin by taking an equivalent short position in the derivatives market to create zero net exposure to the coin in order to launch the attack.

You don't even need a derivative market (although that is another way to leverage the nothing at stake problem).  You have some coins in block x, you sell the coins, you now have nothing however you can re-org the chain back from block x.  Why?  Although you have nothing "now" in the past back at block x you did have something.  You are attacking with the "memory" or history of coins.

One can even combine both attacks.  
1) Gradually build a position in both the coin (long) and derivative market (short).
2) Unwind both the long and short position in (1)
3) Launch memory attack.
The advantage for the attacker over a straight memory attack is keeping price fluctuation in the coin low during (1).
Edit: There is another advantage for the attacker in that there can also be "nothing at stake" during the build-up in (1) because of the hedged position.

[devphp]

The problem with proof of stake is that stake in the coin does not equal exposure to the coin if a derivatives market in the coin exists. I explained this attack in this post and the subsequent discussion. https://bitcointalk.org/index.php?topic=694436.msg7946409#msg7946409 Basically one hedges one's stake in the coin by taking an equivalent short position in the derivatives market to create zero net exposure to the coin in order to launch the attack.

I explained in that same thread why this attack is two orders of magnitude more expensive than the 51% attack on Bitcoin.

[devphp]

You don't even need a derivative market (although that is another way to leverage the nothing at stake problem).  You have some coins in block x, you sell the coins, you now have nothing however you can re-org the chain back from block x.  Why?  Although you have nothing "now" in the past back at block x you did have something.  You are attacking with the "memory" or history of coins.

First you must secure $50 bln. (as in $50 000 000 000) funding to buy enough stake. Then you can try.

[Coinler]

Updadet tread is here https://bitcointalk.org/index.php?topic=674029.0;topicseen



Proof of Stake coins have many issues here are some:

PoS is not backed by anything other than the belief there are worth anything and there will be an endless supply of PoS coins because one created today does not have a significant advantage over on created tomorrow, next week, next month.......
What currently is happening is new coins are created with PoW, mined for a week until a fixed number is reached and then change to PoS and then you can claim your stake at buying xyz coin. The only advantage a coin released today has over on made sometime in the future is; somebody already bought into it. The advantage quickly disappears if the new coin has a better catch phrase a flashier webpage or bigger marketing capital....
There is no end in sight for stake claimed coins and all promising x % return if you know a bit of programming you will have your very one coin too and everyone can buy into your claim based coin completely deluding the marked.
Its a barrel without bottom and once it clicks by the herd run for the hills if you own a stake.  
  
With a PoS the richer get richer. The most significant flaw of any proof-of-stake system and any system that diminishes coin rewards, is it can't distribute currency from the hoarders to the users of the currency, thus it will end up with the hoarders (the banksters) accumulating all the coin and the currency usage dying.
This is because the wealthy spend a much lower % of their net worth than the masses do.


PoS is a technological dead end. Once the coin is released the only thing to do is "claim your stake" no research, no new capital outside the buy in, no evolving industry...

PoS can NEVER remain decentralized. Satoshi's Proof-of-Work is the only known solution to the Byzantine General's Problem (was a known unsolved problem since at least the 1970s).

PoS is forbidden under Sharia law as it is interest paying

To 51% PoS is dead easy:
You start buying aggressively or "willy" style until you have 51% of a PoS coin, and then sell off your coins so that you no longer have 51%, but your history of having once owned 51% makes it possible to attack the network at any time in the future at next to no cost only some computing resources (and thus electricity costs, etc.).
As you once had a 51% stake, you can build a better blockchain than the other 49% can, starting from the point where you owned 51%. You develop this blockchain in secret, after you have sold off your coins (and profiting from it); and then release your secret blockchain to the world, and nodes will pick it up because it carries more stake than the 49% blockchain.  Now not only do you have your profit from the original sales of the coin, you have your 51% back (to the extent that it's worth anything).  Not all coins need to be in one address, in fact, doing so would prevent the attack in most PoS implementations.
Unlike bitcoin where everyone can see if anyone comes dangerously close to 51, in PoS its all hidden an attack can happen incognito.
There is no way of knowing if any PoS chain is already "dead", as it could have been attacked any-time in the past.
And then there's is also the possible social 51% attack

..........

But then there's the social 51% attack where a tiny majority hold a massive percentage of the currency. When this occurs the market is open to extensive manipulation for the benefit of the few, as with real world economics (the 1%).

NXT is a good example of the social 51% attack, the top 33 accounts hold 51% between them. The top 50 accounts hold 61.2%. I'm quite sure the top 1% of accounts (400 ish) hold almost everything, with the other 99% playing with spare change. Source

 
PoW is a promise x amount of energy has been used is backed by energy. There is no better backing than energy because everyone needs it, wants it and i will never have any problem selling it. To create a PoW coin you need x amount of energy and you can not cheat. The best you can hope for is to have  a more efficient miner. Because the energy has been spent, the coin has a base value (many other things on top) and is a kind of a storage medium of it which you can exchange. Sending a bitcoin is like sending a proof-en  work done.
(The same apply's for gold digging it up, storing.....  difference is it is awkward to exchange)



Edit:
The past 2 days i had a look at nxt and came to the conclusion that:
NXT is a ticking time bomb. NXT will always be at the mercy of the btctalk alias "BCNext" and his friends. The original 71 buy-in aliases just got some nxt depending on the proportion of bitcoins they sent.
https://bitcointalk.org/index.php?topic=303898.msg3253189#msg3253189
As you can see he received a total of 22 btc. Since it was capped to 1 bitcoin and the biggest amount of nxt received from the buy in is 50 000 000 nxt  (top two accounts) it can easy be worked out how much the others got.
http://87.230.14.1/nxt/nxt.cgi?action=30&switch=1
What will never be know how many alias out of the 71 accounts "BCNext" did create and then sent to himself and his mates. You have to strongly assume that he and his friends have the majority of the coins.

The second post is already talking about police and the 3rd post is quoting a post which is missing, hmm oozes confidence . It seems some posts have been deleted.
96% percent of the market it seems is in china (bter) https://coinmarketcap.com/volume.html#nxt

Crypto is all about trust, any bank is 1000 times more trusting than  "BCNext" and his friends all with hidden alias on btctalk
Greed is a bitch.[/i]

[/quote]

i feel like reading these articles against POS are politically charged to combat the growing crypto-community acceptance and demand for POS coins. all of them are "theoretical". added to that let me explain my understanding.

if you were to attack a POS coin by buying aggressively, wouldnt this mean you would be forced to buy a gigantic amount of coins, thus pumping the market to ridiculous high price point allow ALL early investors to cashout at a grand profit along the way? seems a win to me. further more.. the person attempting to attack the pos coin in this manner would then have 51% the POS network leading to unhappiness with new investors thus the coin interest will drop along with price meaning.. they wasted all their money making everyone else rich while gaining NO ROI for themselves? seems like an excercise in futility and so i believe that this attack style is currently useless yet provides a total win-win situation for all who arent attempting to attack the coin(miners and investors). price would be pumped much higher and the average exit point would also be much higher.. leading to stability at a higher price. this is a positive in my book.. no?

[cypherdoc]

You don't even need a derivative market (although that is another way to leverage the nothing at stake problem).  You have some coins in block x, you sell the coins, you now have nothing however you can re-org the chain back from block x.  Why?  Although you have nothing "now" in the past back at block x you did have something.  You are attacking with the "memory" or history of coins.

First you must secure $50 bln. (as in $50 000 000 000) funding to buy enough stake. Then you can try.

apparently it only costs 200BTC, or approx $100,000, to buy 45M NXT. 

not quite the same maths.

[devphp]

You don't even need a derivative market (although that is another way to leverage the nothing at stake problem).  You have some coins in block x, you sell the coins, you now have nothing however you can re-org the chain back from block x.  Why?  Although you have nothing "now" in the past back at block x you did have something.  You are attacking with the "memory" or history of coins.

First you must secure $50 bln. (as in $50 000 000 000) funding to buy enough stake. Then you can try.

apparently it only costs 200BTC, or approx $100,000, to buy 45M NXT. 

not quite the same maths.

Apparently yes, if you're a hacked exchange and the hacker is willing to sell, which is two big 'IFs'.

[cypherdoc]

You don't even need a derivative market (although that is another way to leverage the nothing at stake problem).  You have some coins in block x, you sell the coins, you now have nothing however you can re-org the chain back from block x.  Why?  Although you have nothing "now" in the past back at block x you did have something.  You are attacking with the "memory" or history of coins.

First you must secure $50 bln. (as in $50 000 000 000) funding to buy enough stake. Then you can try.

apparently it only costs 200BTC, or approx $100,000, to buy 45M NXT. 

not quite the same maths.

Apparently yes, if you're a hacked exchange and the hacker is willing to sell, which is two big 'IFs'.

of course it's quite possible if Bter didn't do it, the price of all NXT on the market would be 0.

[TaunSew]

That's a way of thinking about it.  Maybe that explains why some people have lost faith in NXT but those weak hands will be replaced by stronger hands, no?

[cypherdoc]

[devphp]

of course it's quite possible if Bter didn't do it, the price of all NXT on the market would be 0.

It would stay depressed at 4-5k satoshi for 2-3 months if he chose to sell in equal portions (1m each day), that's how long it would take for the market to absorb 50M volume. If he chose to sell all in one go, it would go to 100-200 satoshi for a few hours, buying 50m NXTs at 500 satoshi takes only 250 Bitcoins, that's about daily volume of NXT trading. So all the 50m would be quickly bought within 1 day, that's rough calculations, give or take a few hours. Gradual selling over 2-3 months would hurt more because it'd be more prolonged bleeding, but not dramatic either.