PoS is far inferior to PoW - why are so many people advocating switching to PoS

[Daedelus]

Daedelus, once kushti posts his papers it's guna put that friggin stupid pdf about pos to shame lol

Maybe, I just hope more people will look at the code more seriously. Cunicula was most open and convincing with his criticism of the so called nothing at stake problem 10 months ago > http://www.reddit.com/r/peercoin/comments/1sokg2/proof_of_stake_and_peercoins_historic_significance/ce17qci

I would be willing to wager Nxt has addressed a), b) and c). It was a good marketing coup for "Nothing @ Stake" a few months ago, most dismissed POS out of hand. This unfortunately meant no one looked at Nxt in detail so has slowed the rate of code reviews. Hopefully this will change 

[1714729981]

1714729981

[1714729981]

1714729981

[DumbFruit]

Cunicula was most open and convincing with his criticism of the so called nothing at stake problem 10 months ago...

Unconvinced.

[Daedelus]

Cunicula was most open and convincing with his criticism of the so called nothing at stake problem 10 months ago...

Unconvinced.

Unsurprised.

[gatra]

Just wait until SPOW launches next year from the Uro team, then everybody can be happy 

Everybody can never be happy and you can bet your last dollar on that )

Of course. I won't be happy with that. POS creates new attack vectors but we accept it because it eliminates the need for massive power consumption.
That hybrid thing has the attack vectors associated with POS and still uses computation intensive PoW. The worst of both worlds!

[big ears]

Just wait until SPOW launches next year from the Uro team, then everybody can be happy 

Can you say what month SPOW launches next year?

[neuroMode]

Myriadcoin's multi-PoW framework helps with the decentralization of mining that some of you may be concerned about. More than you think, actually.

I agree. I have been touting Myriadcoin as one of the biggest innovations in the PoW cryptocurrency world. It is definitely a step forward. Unfortunately, it still doesn't change the fact that a lot of electricity and processing power is wasted in the process. Pretty much all scientists agree global warming is real and PoW only accelerates that. I see PoS or a variant of it as being the ideal solution for consensus mainly for this reason. Why increase emissions unnecessarily simply to reach decentralized consensus when it is not needed because PoS is sufficient at performing the same job? Also.. all of the processing power could actually be used to do something useful to society instead of simply securing a block chain, such as solving cancer or assisting other scientific research. Primecoin is a good example of a PoW algo that is actually useful to society.

These are my biggest concerns about PoW, not the centralization of it. All systems.. PoS and PoW.. inevitably tend towards centralization eventually. PoW tends towards centralization in mining pools and large farms setup with cheap power which utilize the economies of scale ASICs provide. PoS tends towards centralization with the need for check points to prevent certain attacks (or at least in the current variants of PoS.) DPoS works on the realization that all systems inevitably tend towards centralization, ad it gives you a way for stake holders to control that centralization. Stake holders choose who becomes a delegate, with PoW you cannot choose who secures the block chain.. whoever buys mining power can do it. This helps keep nefarious actors out. Also, you can vote in developers and people creating important core services for the coin as delegates to compensate them for doing so. Therefore, a DPoS coin can hire employees that work for the cryptocurrency... PoW can obviously only do this via donations. The use of only 101 delegates allows block times to be reduced to a little as 10 seconds and process many transactions a second.. something that is very hard to achieve (maybe impossible) with PoW. There are many benefits of DPoS over PoW in my mind which far outweigh the highly unlikely attack vectors, and that is why I support it over PoW alternatives.

Question: How much energy is used to keep all the banks in the world operational? Keeping the computers running, building the banks, people wasting gas driving to the banks to take out money, keeping the lights on 24/7 so cameras can record people trying to break in at night, etc. I bet you it's a fuckton. What if a world existed where no banks existed but money was transacted on a PoW blockchain? Does the energy concern matter as much in this context?

[gustav]

coins switch to pos because nobody mines them. Pos is a sign of an inferior coin. A good coin can afford to be pow. Only fools pour a lot of money into pos-coins.

[cryptogeeknext]

Myriadcoin's multi-PoW framework helps with the decentralization of mining that some of you may be concerned about. More than you think, actually.

I agree. I have been touting Myriadcoin as one of the biggest innovations in the PoW cryptocurrency world. It is definitely a step forward. Unfortunately, it still doesn't change the fact that a lot of electricity and processing power is wasted in the process. Pretty much all scientists agree global warming is real and PoW only accelerates that. I see PoS or a variant of it as being the ideal solution for consensus mainly for this reason. Why increase emissions unnecessarily simply to reach decentralized consensus when it is not needed because PoS is sufficient at performing the same job? Also.. all of the processing power could actually be used to do something useful to society instead of simply securing a block chain, such as solving cancer or assisting other scientific research. Primecoin is a good example of a PoW algo that is actually useful to society.

These are my biggest concerns about PoW, not the centralization of it. All systems.. PoS and PoW.. inevitably tend towards centralization eventually. PoW tends towards centralization in mining pools and large farms setup with cheap power which utilize the economies of scale ASICs provide. PoS tends towards centralization with the need for check points to prevent certain attacks (or at least in the current variants of PoS.) DPoS works on the realization that all systems inevitably tend towards centralization, ad it gives you a way for stake holders to control that centralization. Stake holders choose who becomes a delegate, with PoW you cannot choose who secures the block chain.. whoever buys mining power can do it. This helps keep nefarious actors out. Also, you can vote in developers and people creating important core services for the coin as delegates to compensate them for doing so. Therefore, a DPoS coin can hire employees that work for the cryptocurrency... PoW can obviously only do this via donations. The use of only 101 delegates allows block times to be reduced to a little as 10 seconds and process many transactions a second.. something that is very hard to achieve (maybe impossible) with PoW. There are many benefits of DPoS over PoW in my mind which far outweigh the highly unlikely attack vectors, and that is why I support it over PoW alternatives.

Question: How much energy is used to keep all the banks in the world operational? Keeping the computers running, building the banks, people wasting gas driving to the banks to take out money, keeping the lights on 24/7 so cameras can record people trying to break in at night, etc. I bet you it's a fuckton. What if a world existed where no banks existed but money was transacted on a PoW blockchain? Does the energy concern matter as much in this context?

As the purpose of life is to live, the purpose of all the energy in the Universe is to be wasted.
Fighting for freedom with PoW might take a lot of energy, but the end result is worth every joule.

[gatra]

As the purpose of life is to live, the purpose of all the energy in the Universe is to be wasted.
Fighting for freedom with PoW might take a lot of energy, but the end result is worth every joule.

That's not the point. Of course it's worth it. But what if you didn't need to waste it in PoW? what if you could use it to aid your fight in other way? I say that would be better.

[phillipsjk]

I came across a proposal that will introduce Proof-of-Stake to Bitcoin as a non-forking change. (From the coinjoin thread):

Darkwallet's coinjoin works with two parties. One party will wait around with bitcoins they wish to mix. Another party will connect with them whenever they want to do a transactions and the two parties will do a coinjoin. By analogy with exchange matching engines, I will call the first party the coinjoin maker and the second the coinjoin taker.

The idea is that there will be people acting as makers who will slowly mix their coins for the benefit of the takers who want to immediately mix.
...

Proposal: Pay the coinjoin makers. They will put up offers to do coinjoin along with a fee they ask. The coinjoin transaction would be built up in a similar way to the above example, with the coinjoin maker fee being added to the associated change address and taken away from the coinjoin taker's change address.

An implication of this is that darkwallet coinjoin mixing will become like an almost-riskless savings account. We already see that holders of bitcoin are willing to earn just 0.006% per day by lending btc on the bitfinex exchange, and that contains a substantial risk that bitfinex will go disappear or be hacked taking all the bitcoins with it.

So, Bitcoin can benefit from using PoS for coin-mixing. The fear is that without payment, there may be few people outside of 3 and 4 letter agencies willing to risk "tainting" their coins and ending up on a black-list.
 
Edit: That in itself is not really PoS. Where PoS comes in is where you only mix with coins of a certain age to prevent limit  sibyl attacks.

[cryptogeeknext]

As the purpose of life is to live, the purpose of all the energy in the Universe is to be wasted.
Fighting for freedom with PoW might take a lot of energy, but the end result is worth every joule.

That's not the point. Of course it's worth it. But what if you didn't need to waste it in PoW? what if you could use it to aid your fight in other way? I say that would be better.

Of course you can.
If you have freedom you have to stay vigilant to protect it, but that's a constraint, a cage of some sort.
If you are in a cage you no longer need to protect yourself and are finally free to explore your inner self.

It's a paradox.
In every freedom there is an element of constraint and in every constraint there is an element of freedom.
That's what infamous yin-yang symbol really means.

[Daedelus]

For curious minds, first installment from the POS research group...

https://nxtforum.org/consensus-research/multibranch-forging-approach/

[dbkeys]

This may be true, but that does not mean that there is no merit at all to Proof-of-Stake.  There are many people who believe that one-man-one-vote is not the best system, that instead, a system where the more educated or resourceful have a greater say is better.

[cryptogeeknext]

This may be true, but that does not mean that there is no merit at all to Proof-of-Stake.  There are many people who believe that one-man-one-vote is not the best system, that instead, a system where the more educated or resourceful have a greater say is better.

PoS is suitable for shares in the company. It is also compatible with the idea that many PoS systems need to compete between each other to stay robust, while PoW allows competition within the system.

We already have a money system in place owned by snake err... stakeholders, you know how it turned out. We are not yet at the hunger games scenario, but that's where any unchallenged PoS system is eventually headed.

PoW is not one-man-one-vote, it is rather one-willing-to-compete-for-control-one-allowed-to-do-so

[sucksyd]

In a PoS system, acquiring enough stake to attack will cost you astronomical amount of money

Well it didn't cost the government an astronomical amount to obtain those massive amount of bitcoins from the silk road bust.
Lucky bitcoin isn't POS or it'll be screwed.

this is how blackcoin faced his apoclypse.

[fran2k]

You just have to buy 51% of the currency or track down majority of stakeholders and compromise their private keys. Much cost free

lots of people seem to believe this (I think it's even mentioned in Sunny King's PPC paper), but it's not accurate: you need 51% of the actively staking coin-age. That's much, much, less than 51% of the currency.
I had some ideas to help fix this, I'm working on it.

Peercoin PoS is not the same as NXT PoS, the latter doesn't use coin-age.

it doesn't matter, it has the same probblem, just replace "coin-age" by "coins".
form their "whitepaper" (actually a wiki):

tokens must be stationary within an account for 1,440 blocks before they can contribute to the block generation process

this means all coins that are used for transfers cannot be staken and do not count toward the total of which you need 51%
moreover, lots of holders do not stake, so it's not 51% of coins, it's 51% of coins being actively at stake

...and it get worse if you consider NXT has punishments for not staking...

DPoS doesn't suffer from this problem. You would need to buy up 51% of the currency supply to use this attack vector.

Also the Bitshares community believes DPoS is immune to a NaS attack. No one has been able to prove us wrong yet.

More about DPoS: http://bitshares.org/delegated-proof-of-stake/
Even more about DPoS: http://wiki.bitshares.org/index.php/DPOS
Old discussions on DPoS: https://bitsharestalk.org/index.php?topic=4009.0
Discussions regarding "nothing at stake" attacks: https://bitsharestalk.org/index.php?topic=6584.0
More discussion about NaS attack: https://bitsharestalk.org/index.php?topic=6638.0

Great links. I'm heavily supporting DPoS. When organizations, companies and others understand the powerfulness this tool is bringing we will have another little crypto revolution

[Daedelus]

Mining costs are ramping up with a speed of lightning and reward for block finding is going down. At some point there is no way to enter this economy since there are "top miners" who will simply outmine you.

"Free Entry" does not mean "low capital requirements".

http://yadayadayadaecon.com/concept/free-entry-and-exit/

I fail to understand why an attacker has to choose which chain to participate in.

The built-in fundamental premise of PoS is that the stakers will mostly behave themselves because they have a lot of stake. Ultimately, if they misbehave the "trustworthy" will roll it back to their preferred chain.

The mechanism by which this roll back takes place in NXT is through trusted peer lists and a 720 block fork limit. (Not through formal "checkpoints" like I expected.)

So PoS does not achieve trust-free globally decentralized consensus, which is the entire point of the N@S criticism.

http://download.wpsoftware.net/bitcoin/pos.pdf

Though I think I'm preaching to the choir...

Serious research into POS can be found here >>> https://bitcointalk.org/index.php?topic=897488.0

You can even play with the models to check the findings yourself. I love that PDF btw, esp the bit at the end where they admit they have no rigorous analysis to back up their claims. Only intuition 

Please consolidate comment on the above to the link >>> https://bitcointalk.org/index.php?topic=897488.0