Is PoS dead?

[devphp]

Bitcoin chart looks the same, if you choose the convenient period, let's say, from December to now

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[TaunSew]

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.

Actually the hacker admitted himself that he was a hold.  Ironically, if the hacker kept his 51 million coins, it probably would had caused NXT to go up through deflation.  Just like Satoshi never spending his BTC is very deflationary on the available supply.


Reality is that NXT's up and downs is largely due to whales engaging in pump and dumps and one or two whales lost their funds at BTer.  If the hacker had kept his fund there may actually be *gasp* stability to NXT.

[devphp]

Well, I am posting a worst case scenario.

[cypherdoc]

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.

you're using hard #'s as if there is no such thing as confidence, panic, or public perception. 

Bter knows it. which is why they negotiated with the terrorist hacker. 

with POW, we took the Gox hit but it didn't kill Bitcoin b/c of the resource investment of miners who can't and won't just quit.  not to mention the network effect in place.

[cypherdoc]

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.

Actually the hacker admitted himself that he was a hold.  Ironically, if the hacker kept his 51 million coins, it probably would had caused NXT to go up through deflation.  Just like Satoshi never spending his BTC is very deflationary on the available supply.


Reality is that NXT's up and downs is largely due to whales engaging in pump and dumps and one or two whales lost their funds at BTer.  If the hacker had kept his fund there may actually be *gasp* stability to NXT.

i seriously doubt this.

if a known thief and hacker had been allowed to keep 5% of the NXT stake, he would have destroyed confidence in the entire system causing a plunge in the price.

[smoothie]

I believe PoS is broken as any exchange can have too much of the current supply and then do what they please with it or get hacked.

That is the equivalent of all Bitcoin miners sending their gear to hash with to an exchange for them to store. Essentially handing the keys of security of the network to a single exchange and possibly a single person.

Very very flawed.

[darkota]

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.

Actually the hacker admitted himself that he was a hold.  Ironically, if the hacker kept his 51 million coins, it probably would had caused NXT to go up through deflation.  Just like Satoshi never spending his BTC is very deflationary on the available supply.


Reality is that NXT's up and downs is largely due to whales engaging in pump and dumps and one or two whales lost their funds at BTer.  If the hacker had kept his fund there may actually be *gasp* stability to NXT.

No, it would of caused the opposite. Satoshi's 1million Bitcoin holding is helping Bitcoin ONLY because most of us believe that he will Never spend them, if Satoshi ever returned and even moved some of his bitcoin around, Bitcoin's entire price will collpase to sub $100.

With the hacker's case, he probably would of sold/spent the NXT coins instead of holding, which is why the price of NXT took a hit.

[TaunSew]

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.

Actually the hacker admitted himself that he was a hold.  Ironically, if the hacker kept his 51 million coins, it probably would had caused NXT to go up through deflation.  Just like Satoshi never spending his BTC is very deflationary on the available supply.


Reality is that NXT's up and downs is largely due to whales engaging in pump and dumps and one or two whales lost their funds at BTer.  If the hacker had kept his fund there may actually be *gasp* stability to NXT.

i seriously doubt this.

if a known thief and hacker had been allowed to keep 5% of the NXT stake, he would have destroyed confidence in the entire system causing a plunge in the price.

Maybe there's room for doubt but it's not reassuring that NXT has a lot of whales, some of them anonymous and don't contribute on their forums, who can engage in regular pump or dump and decide one morning if they feel like killing a coin off.

Would I take a known thief and hacker who is a "hold" over a whale orchestrating pump and dumps?  Sure...    That is an apathetic assessment about the overall market, not me condoning hacking or pump and dumps.   Whales can cause immense damage to a coin - more coins are killed off by pump and dumps than hackers.


  

[devphp]

you're using hard #'s as if there is no such thing as confidence, panic, or public perception. 

Bter knows it. which is why they negotiated with the terrorist hacker. 

with POW, we took the Gox hit but it didn't kill Bitcoin b/c of the resource investment of miners who can't and won't just quit.  not to mention the network effect in place.

I tried to give enough room for all those factors and posted a worst case scenario. The fact is NXT community is still pretty condensed compared to Bitcoin and there is simply no public perception and not much public to dump coins in case of panic, which is both a blessing and a curse. There's been a few serious bugs in the past few months that were quite serious and would probably make Bitcoin users dump if they were to happen in Bitcoin network, however, NXTers are not that dispersed yet. Another factor is, the price is already so low that it doesn't take much capital to absorb dumped coins. That's why even in the worst case scenario it wouldn't have much effect.

5% of the total coin supply doesn't let the hacker control anything except the price for a while, 51% is required now to control the network and 90% in a few months when Transparent Forging is enabled.

But I agree that centralized exchanges are no good, that's why NXT is implementing decentralized tools - multigateway is one of them, it is not 100% decentralized, but it would require hacker to break into 3 servers controlled by 3 different people, instead of just 1 server as is the case with a centralized exchange.

[cypherdoc]

you're using hard #'s as if there is no such thing as confidence, panic, or public perception. 

Bter knows it. which is why they negotiated with the terrorist hacker. 

with POW, we took the Gox hit but it didn't kill Bitcoin b/c of the resource investment of miners who can't and won't just quit.  not to mention the network effect in place.

I tried to give enough room for all those factors and posted a worst case scenario. The fact is NXT community is still pretty condensed compared to Bitcoin and there is simply no public perception and not much public to dump coins in case of panic, which is both a blessing and a curse. There's been a few serious bugs in the past few months that were quite serious and would probably make Bitcoin users dump if they were to happen in Bitcoin network, however, NXTers are not that dispersed yet. Another factor is, the price is already so low that it doesn't take much capital to absorb dumped coins. That's why even in the worst case scenario it wouldn't have much effect.

5% of the stake doesn't let the hacker control anything except the price for a while, 51% is required now to control the network and 90% in a few months when Transparent Forging is enabled.

But I agree that centralized exchanges are no good, that's why NXT is implementing decentralized tools - multigateway is one of them, it is not 100% decentralized, but it would require hacker to break into 3 servers controlled by 3 different people, instead of just 1 server as is the case with a centralized exchange.

this condensed nature is precisely the problem with POS.  as i understand it looking back in this thread, NXT is highly concentrated amongst it's early adopters which is the opposite of what you want.  i fail to see how this improves with time; in fact, it should only get worse the way that forging works.

the worse scenario can get much worse; as in going to zero.

[devphp]

this condensed nature is precisely the problem with POS.  as i understand it looking back in this thread, NXT is highly concentrated amongst it's early adopters which is the opposite of what you want.  i fail to see how this improves with time; in fact, it should only get worse the way that forging works.

the worse scenario can get much worse; as in going to zero.

Anything can go to zero, there is no insurance against that, only taxes can't

The argument of distribution in NXT is beaten to death already. You can think of NXT distribution as having 2 stages: Stage 1 - initial distribution to 73 people. Stage 2 - is ongoing and will take years to unfold. Original stakeholders have been selling for almost 9 months, otherwise where would all the coins on the market come from? They need to cash out, they won't hold forever, just like in Bitcoin early adopters cash out.

In the end, all currencies tend to follow Pareto Principle, where 80% of the coins end up in the hands of 20% people. That works in real life, there is no reason it will be different with crypto currencies.

[TaunSew]

this condensed nature is precisely the problem with POS.  as i understand it looking back in this thread, NXT is highly concentrated amongst it's early adopters which is the opposite of what you want.  i fail to see how this improves with time; in fact, it should only get worse the way that forging works.

the worse scenario can get much worse; as in going to zero.

Anything can go to zero, there is no insurance against that, only taxes can't

The argument of distribution in NXT is beaten to death already. You can think of NXT distribution as having 2 stages: Stage 1 - initial distribution to 73 people. Stage 2 - is ongoing and will take years to unfold. Original stakeholders have been selling for almost 9 months, otherwise where would all the coins on the market come from? They need to cash out, they won't hold forever, just like in Bitcoin early adopters cash out.

In the end, all currencies tend to follow Pareto Principle, where 80% of the coins end up in the hands of 20% people. That works in real life, there is no reason it will be different with crypto currencies.

Yeah but it is not an either and or.  Most of the NXT whales have since diversified or keep a lot of their reserves in BTC.  We know NXT will rebound because one of the whales will eventually engage in a bailout with their BTC that they only acquired through selling NXT in 2013.   This is the pump and dump, then re-pump cycle.


Only way for NXT to die is for people to stop paying bounties and/or developers abandon ship for another coin.  The thing is that NXT developers are largely Java and there isn't really any other Java coins to flock to, minus the odd exception or two.

[devphp]

any exchange can have too much of the current supply and then do what they please with it or get hacked.

You mean Mt.Gox? Everything is happening faster in NXT. It had its 'Mt.Gox' moment in its first year, which took Bitcoin a few years. Hopefully people learn from their mistakes and don't keep coins at exchanges. These hacks will give boost to trade on multigateway. At least users on bter haven't lost all the coins like on Mt.Gox and should be able to get the bulk of their stored coins back.

[tooil]

PoW is decentralized and PoW is somewhat centralized depending on how the developers implement it.

Funny the trend for altcoins are heading toward centralization which we all oppose.

[TaunSew]

PoW is decentralized and PoW is somewhat centralized depending on how the developers implement it.

Funny the trend for altcoins are heading toward centralization which we all oppose.

The main problem I have with POS coins is that they release all coins basically in short space of time if there is even a POW start off. This inflates the marketcap a lot as 100% of the initial supply is on the market straight up. Then slowly increases with given interest rate.

NXT has a high marketcap but try dumping even 0.01% of the coins on the market and see what happens with the price, now if NXT was 2nd GEN PoW(If such a thing could exist) would it even be in top 50 right now?

It doesn't even need to be POW.  If NXT was $5 million in late December versus $80+ million then it could be a dying coin at the moment.  Having a huge capitalization helped in attracting developers and users.

Much like if they somehow were able to pump NXT to $200 million overnight through some kind of Keynesian pump involving $millions of Fiat then who knows what the consequence of that would be.

[User705]

I believe PoS is broken as any exchange can have too much of the current supply and then do what they please with it or get hacked.

That is the equivalent of all Bitcoin miners sending their gear to hash with to an exchange for them to store. Essentially handing the keys of security of the network to a single exchange and possibly a single person.

Very very flawed.

Yep.  Bitcoin miners mosly mine for themselves and don't use two or three pools that control majority of the hash rate.  No wait that's not right.  What were you talking about again?
 

[doo]

this condensed nature is precisely the problem with POS.  as i understand it looking back in this thread, NXT is highly concentrated amongst it's early adopters which is the opposite of what you want.  i fail to see how this improves with time; in fact, it should only get worse the way that forging works.

the worse scenario can get much worse; as in going to zero.

Anything can go to zero, there is no insurance against that, only taxes can't

The argument of distribution in NXT is beaten to death already. You can think of NXT distribution as having 2 stages: Stage 1 - initial distribution to 73 people. Stage 2 - is ongoing and will take years to unfold. Original stakeholders have been selling for almost 9 months, otherwise where would all the coins on the market come from? They need to cash out, they won't hold forever, just like in Bitcoin early adopters cash out.

In the end, all currencies tend to follow Pareto Principle, where 80% of the coins end up in the hands of 20% people. That works in real life, there is no reason it will be different with crypto currencies.

Stage 1 initial distribution of 73 people is wrong. It is 73 anonymous accounts on bitcointalk forum and the entity
"BCNext"  (whoever that is could be the FED for all we know) controls 50 or more of those accounts and sent more than 90% of all the initial money to himself (they actively discouraged to sent large amounts).

This will be done by sending a small amount of BTC to my own address.  I bet most of you have just thought “I got the catch!”  Hold on, I don’t ask you to send thousand USD worth coins, a few satoshis is enough

He sent himself high amounts (max was 1BTC) to himself with the accounts created at the forum. As the initial distribution is according to satoshis sent, the guy sending a few satoshis still got millions of nxt.
Next stage is to buy heavy from the reaming early adaptors and get another couple% of coins, site effect price rise.  Now having full control of the price current "investors" ponzie participants jump when he says jump and duck when he says duck.
Its a scam it its purest form and fails miserable as money you can not stake and spend at the same time.
2 types of Nxt shills are either part of the scam or completely clueless.



Bitcoin is a intangible good, a commodity

"The price of any commodity tends to gravitate toward the production cost" -Satoshi

http://crypt.la/2014/01/06/satoshi-nakamoto-quotes/
.

[HCLivess]

I laughed hard

[Nullu]

I think the concept is solid, but the way it's executed is flawed.

Grain had a lot of issues with PoS/PoW, because of the way they divvy up the blocks. It went over my head somewhat, but too much of one negatively affected the other. It's probably why you see a lot more pure PoS coins now.

I think PoS works conceptually, but the way it's designed has some flaws. A PoS v2 that could address those problems would be very interesting.

[coinsolidation]

I think PoS works conceptually, but the way it's designed has some flaws. A PoS v2 that could address those problems would be very interesting.

Would you care to expand?