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Author Topic: Communist Bitshares Wealth Redistribution IS THEFT!  (Read 28030 times)
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January 14, 2015, 09:29:20 PM
 #181

If BitShares stakeholder numbers grow and there remain 101 delegates it becomes more centralised while remaining sufficiently decentralised.  The purpose of decentralisation is to protect the network from being shutdown.  It doesn't matter if there are thousands of stakeholders or millions, 101 delegates is sufficiently decentralised to protect the network.

It part of the incentive structure for the large stake holders to vote for delegates who bring value to the system, not to just vote themselves in.  That undermines their own investment.  If you look in the delegate proposal section on the bitsharestalk forum, you will see free market competition is thriving, we have multiple exchanges, marketers and developers competing for delegate spots.  

Yes, I keep trying to convince people that the Federal Reserve is "sufficiently decentralized" because it has seven governors, but no one believes me.

At some point the amount of delegates will be increased. Most likely this will be as the network grows so incredibly large and valuable that adding diminishing amounts of increasing decentralization is worth the linear cost of adding extra block producing nodes. It could also be if NXT ever gets its shit together and manages to have more than 16 nodes controlling half the network. If NXT started approaching 51 block producers for half the blocks then bitshares voters will probably support doubling the amount of delegates for the sake of PR, just so BitShares continues being more decentralized than NXT.

One thing is for sure, NXT will NEVER have more independent block producers than bitshares because leased forging encourages centralization and the only way to get forgers to spread out will be by begging them to do so, the same way BTC users have to beg miners not to join GHASH and discus fish.

With bitshares you just vote for a hard fork that forces the amount of block producers to increase, and then you vote for delegates who are either old and trusted community members, who have revealed their identity, or who are blockchain employees doing quantifiable work (thus proving they are not a sockpuppet). No other blockchain even have any reliable methods to determine their degree of decentralization, which is the first step to systematically increase it in the long run. We'll never know if GHASH secretly controlled more than 51% of mining power all along, and we'll never know how many of the 16 NXT pools are controlled by the same person.

Communist lies.  NXT doesn't force anyone to lease their forging power and it gives no added benefit except for more consistent payouts if you are impatient.  Leasing was only implemented to allow NXTers to keep their main wallets offline and safe, but still be able to forge with the balance by leasing their stakepower to an online account they also control.  Bitshares' forces you to elect 101 delegates to forge for the entire network.  Because you use "approval voting" the mass majority of the delegates can be voted in by a coalition of a few wealthy stakeholders.  Like all Communists, you want to redistribute wealth (forging power) under the illusion of "economy" and "efficiency".  A stakeholder should be allowed to forge in proportion to his investment.  That's not "centralization"; it's "free market capitalism".

And having more than 101 delegates might not be so great because the list of block-signers becomes so big that it has to be professionally managed which adds a different type of centralization.  (a type of centralization = attack vector)

Really?  Independent forgers need to be "professionally managed"?  How did you come up with that ridiculous idea?

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January 14, 2015, 10:14:44 PM
 #182

It's hilarious, i read their forums. Much drinking of the cool-aidz.

And then there was the call to arms they actually held a forum rally to come and defendtheir broken system.

Oh but the discussions here had one good effect, Bytemaster got off his throne/blog where his acolytes worship and went back to coding.


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January 15, 2015, 06:13:48 AM
 #183


For all those interested in how a few of the wealthiest Bitshares' stakeholders can effectively rig the mass majority of the elections, here is how.

It doesn't matter if you collect delegates' SSNs, driver's licenses, birth certificates and thumbprints, Bitshares' DPoS mechanism will always be susceptible to manipulation.  You have introduced a "social construct" (aka voting) which turns Bitshares' delegates into a "government of the wealthy".  No one will ever know what type of "behind-the-scenes" politics is going on which results in which delegates are selected.

Because you have instituted this ridiculous charade into chain security, all your figures on "decentralization" and "speed of decentralization" are speculative and assume that all 101 delegates are unique, non-colluding individuals.  The fact is all these delegates are not going to compete against each other for a position.  Who will become a delegate and control the delegate selection process are the wealthiest stakeholders.  This will be accomplished in a quid pro quo manner.  This means that really Bitshares is less decentralized than NXT because they will be able to form political/business coalitions which imo will result in them dominating the delegate selection process.  The wealthiest stakeholders in Bitshares can do this very easily because it is an "Approval Voting" process.  This allows stakeholders to put the entire weight of their stake behind each and every delegate they approve. The Bitshares' devs will deny this to the very end because they are part of this "ruling elite".

I think I could make a pretty good argument that delegates' "real world" identities being known by the community doesn't really matter or prevent a "Sybil attack".  Imo, what would constitute a "Sybil attack" is the collusion of delegates' motives.  I'm also pretty positive that the colluding delegates wouldn't "harm" the Bitshares' ecosystem, but instead use their power to manipulate delegate elections to capitalize on the delegate positions.  Everybody can know everyones' name, but it's impossible to know their true intentions.

Any block chain has the problem that a few big players can collude, whether they are large stakeholders or large hashpoolers.  We dilute that down to under one percent influence per delegate, max.

Then there's the question of what they can collude about.  We can all observe whether they are performing their very limited block signing job to spec or not. We can look at their published price feeds. They have no other power.

That's true that in all blockchains stakeholders/hashpower can collude, but they can only collude in a one-to-one proportion to their stake/hash.  Since approval voting is used in delegate elections, I maintain that large stakeholders can effectively collude to a multiple proportion of their stake.  Whereby, for example, 20% of colluding stake can disproportionately influence the elections of more than 20% of the delegates.  This leads to a coalition of a few wealthy stakeholders being able to determine the outcomes of the mass majority of the delegate elections.  This is especially true considering that voter turnout of smaller stakeholders will be lower than the voter turnout of larger stakeholders.  As I said previously, it would be the intention of the colluding wealthy stakeholders to not harm Bitshares, but to elect delegates from which they would derive monetary gain in excess to their proportion of stake in the system at the expense of all other stakeholders.

Let's give an example.  Remember, in "approval voting", voters do not just vote for one delegate.  They can select as many or as few delegates as they wish and the entire weight of their stake counts towards each delegate they choose.  Say for instance that the top delegate has 50% of the vote and the 101st delegate has 30% of the vote.  The voting spread percentage is 20% (50%-30%).  If the votes per delegate is a linear increase according to delegate rank, an additional 10% of the stake vote will move the 101st delegate to the 50th position.  Likewise, a removal of 10% of the stake vote from the lower 50 delegates will result in them losing their delegate position.  By strategically voting, a few wealthy stakeholders can influence a disproportionate number of delegate positions in relation to their actual stake.  In this example, a coalition of 10% stake was able to control 50% of the delegates.

Does this sound fair to you?!

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January 15, 2015, 05:45:13 PM
 #184

"Fairness" has nothing to do with it.  The goal is to build a reliable blockchain company that will provide great service to it's customers and a rate of return to its owners.  Companies hire service providers to provide services, not as wealth distribution mechanism to "give everyone a chance to earn a little bit".  Reliability, integrity and profitability are our design objectives.  So any cost-effective implementation that reliably signs blocks correctly is acceptable.

For POW, POS, and DPOS systems large stakeholders control a disproportionately large portion of who signs the blocks unless the multitudes of small stakeholders are motivated to participate.

This generally does not happen for any of the systems because of a phenomenon known as rational ignorance.

Quote
Rational ignorance occurs when the cost of educating oneself on an issue exceeds the potential benefit that the knowledge would provide.  Ignorance about an issue is said to be "rational" when the cost of educating oneself about the issue sufficiently to make an informed decision can outweigh any potential benefit one could reasonably expect to gain from that decision, and so it would be irrational to waste time doing so. This has consequences for the quality of decisions made by large numbers of people, such as general elections, where the probability of any one vote changing the outcome is very small.   -- http://en.wikipedia.org/wiki/Rational_ignorance

In a POW system, to make any impact a small hasher would need to remove herself from the hashing pool that she has had doing the signing for her (or at least make an independent decision about what software to run) - an act that requires becoming informed about that whole process.  Then, the impact is felt only in the very rare event that lightning strikes that node and her software actually gets to sign a single block.  To continue having any effect, she needs to keep running her node and staying informed - both of which involve large continuing costs.  The rational ignorance principle says she probably won't.  Most holders of POW coins buy them rather than mining them and thus have no say at all.

In a POS system, to make any impact a small forger would need to remove herself from the leasing pool that had been doing the signing for her (or at least make an independent decision about what software to run) - an act that requires becoming informed about that whole process.  Then, the impact is felt only in the very rare event that lightning strikes that node and her software actually gets to sign a single block.  To continue having any effect, she needs to keep running her node and staying informed - both of which involve continuing costs.  The rational ignorance principle says she probably won't.  

In a DPOS system, a small voter is still subject to the rational ignorance principle most of the time, but, when there is a problem, she can wake up and become informed on the source of the problem (probably by studying the forum debate and taking the advice from people there she trusts).  Then, in a few clicks she can vote in a new slate of delegates, change who is running the system, and go about her business - without needing to sustain her efforts or incur any further costs.  Her one time input takes place immediately and the problem is fixed.  

With the other systems, the vigilance of the masses will eventually fade and the problem can reemerge.

With POW and POS, large players have absolute power over what software gets run every time they get a turn.

With DPOS, large players may have the final say, but they must pick from a pool of candidates that already have the most approval from everybody else.  If the candidates preferred by the big players haven't done the reputation building work to attract enough voter attention from the masses to be close to getting elected, then those candidates are simply ineligible.

Bottom line is that the DPOS process only allows nodes that have reputations that are sufficiently trusted by the general population and those reputations can be burned out of contention by a jury of their peers at the slightest perception of misbehavior.  

Reputations are hard to earn and easy to burn.

And everybody has a fair say about whether they trust each and every candidate.

Thus DPOS is the only solution of the three discussed here, that has a way to ensure that all signing nodes have passed the threshold of generally acceptable reputations.  This means that every single DPOS block is signed by someone with an acceptable reputation to the owners of its tokens and never more than 1% of the blocks are signed by any one node.

That's all the typical small holder really cares about.




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January 15, 2015, 08:15:32 PM
 #185

Bitshares Communist vs NxT free world?   Shocked

There ain't no Revolution like a NEMolution.  The only solution is Bitcoin's dissolution! NEM!
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January 15, 2015, 08:19:07 PM
 #186

Bitshares Communist vs NxT free world?   Shocked

This topic about BitShares Communist Edition, never seen Nxt Free World topic.  Smiley

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January 16, 2015, 06:18:51 AM
 #187

"Fairness" has nothing to do with it.

That's what I thought.  Thank you for admitting that to the community.

The wealthiest stakeholders will be able to field the most delegate candidates because you have to pay ~$1100 USD to run for a delegate position.  The only limitation on how many delegates you can run is the depth of your pockets.  The delegate candidates of the wealthy stakeholders will also have the financial backing to out campaign the delegate candidates which aren't part of the "coalition of the wealthy".  No one really knows what delegates are part of this scheme and what type of kickbacks the elected delegates are giving back to their "sponsors".  These "kickbacks" can potentially be paid off-chain to keep it a secret.  Because of this, it can be surmised that a very high percentage of all potential delegates will be owned by the "coalition of the wealthy".  Since, as shown previously, a very small percentage of stake can control the outcomes of a highly disproportionate amount of elections, the entire system is basically owned by these wealthy stakeholders.  Imo, this is a system intentionally designed to enrich the wealthiest stakeholders at the expense of everyone else.

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January 16, 2015, 02:28:40 PM
 #188

Oligarchs of nxt feel very uneasy lately, I wonder why   Grin
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January 16, 2015, 02:36:43 PM
 #189

"Fairness" has nothing to do with it.  The goal is to build a reliable blockchain company that will provide great service to it's customers and a rate of return to its owners.  Companies hire service providers to provide services, not as wealth distribution mechanism to "give everyone a chance to earn a little bit".  Reliability, integrity and profitability are our design objectives.  So any cost-effective implementation that reliably signs blocks correctly is acceptable.

For POW, POS, and DPOS systems large stakeholders control a disproportionately large portion of who signs the blocks unless the multitudes of small stakeholders are motivated to participate.

This generally does not happen for any of the systems because of a phenomenon known as rational ignorance.

Quote
Rational ignorance occurs when the cost of educating oneself on an issue exceeds the potential benefit that the knowledge would provide.  Ignorance about an issue is said to be "rational" when the cost of educating oneself about the issue sufficiently to make an informed decision can outweigh any potential benefit one could reasonably expect to gain from that decision, and so it would be irrational to waste time doing so. This has consequences for the quality of decisions made by large numbers of people, such as general elections, where the probability of any one vote changing the outcome is very small.   -- http://en.wikipedia.org/wiki/Rational_ignorance

In a POW system, to make any impact a small hasher would need to remove herself from the hashing pool that she has had doing the signing for her (or at least make an independent decision about what software to run) - an act that requires becoming informed about that whole process.  Then, the impact is felt only in the very rare event that lightning strikes that node and her software actually gets to sign a single block.  To continue having any effect, she needs to keep running her node and staying informed - both of which involve large continuing costs.  The rational ignorance principle says she probably won't.  Most holders of POW coins buy them rather than mining them and thus have no say at all.

In a POS system, to make any impact a small forger would need to remove herself from the leasing pool that had been doing the signing for her (or at least make an independent decision about what software to run) - an act that requires becoming informed about that whole process.  Then, the impact is felt only in the very rare event that lightning strikes that node and her software actually gets to sign a single block.  To continue having any effect, she needs to keep running her node and staying informed - both of which involve continuing costs.  The rational ignorance principle says she probably won't.  

In a DPOS system, a small voter is still subject to the rational ignorance principle most of the time, but, when there is a problem, she can wake up and become informed on the source of the problem (probably by studying the forum debate and taking the advice from people there she trusts).  Then, in a few clicks she can vote in a new slate of delegates, change who is running the system, and go about her business - without needing to sustain her efforts or incur any further costs.  Her one time input takes place immediately and the problem is fixed.  

With the other systems, the vigilance of the masses will eventually fade and the problem can reemerge.

With POW and POS, large players have absolute power over what software gets run every time they get a turn.

With DPOS, large players may have the final say, but they must pick from a pool of candidates that already have the most approval from everybody else.  If the candidates preferred by the big players haven't done the reputation building work to attract enough voter attention from the masses to be close to getting elected, then those candidates are simply ineligible.

Bottom line is that the DPOS process only allows nodes that have reputations that are sufficiently trusted by the general population and those reputations can be burned out of contention by a jury of their peers at the slightest perception of misbehavior.  

Reputations are hard to earn and easy to burn.

And everybody has a fair say about whether they trust each and every candidate.

Thus DPOS is the only solution of the three discussed here, that has a way to ensure that all signing nodes have passed the threshold of generally acceptable reputations.  This means that every single DPOS block is signed by someone with an acceptable reputation to the owners of its tokens and never more than 1% of the blocks are signed by any one node.

That's all the typical small holder really cares about.



Mt gox had a good reputation too, until it didn't.  So did Bernie Madoff and Enron.


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January 16, 2015, 03:31:57 PM
 #190

Reputation alone is insufficient.  

You must engineer a system that combines these features to avoid a Mt. Gox:

1.  Hard to earn / easy to lose reputation (BTS delegates must earn trust of most voters over time).
2.  Strict limitations on what the actors can do (all they can do is sign blocks, or not).
3.  Transparent visibility into actor behavior (improper blocks are obvious to all).
4.  Ability for owners to quickly fire bad actors (click to remove individual approval).
5.  Tracking approval on a transparent block chain (no way to cheat in electing delegates).
6.  Limit the max scope of any single actor (less than 1% nodes signed by any one actor).


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January 16, 2015, 09:01:16 PM
 #191

Reputation alone is insufficient.  

You must engineer a system that combines these features to avoid a Mt. Gox:

1.  Hard to earn / easy to lose reputation (BTS delegates must earn trust of most voters over time).
2.  Strict limitations on what the actors can do (all they can do is sign blocks, or not).
3.  Transparent visibility into actor behavior (improper blocks are obvious to all).
4.  Ability for owners to quickly fire bad actors (click to remove individual approval).
5.  Tracking approval on a transparent block chain (no way to cheat in electing delegates).
6.  Limit the max scope of any single actor (less than 1% nodes signed by any one actor).




Well there is nothing new about the fact that
in any cryptocurrency that there are limits
on what bad actors can do, and that there is a protocol that has
to be followed.  

Reputations generally ARE hard to earn and easy to lose.
However, if there is money at stake, people will go to
elaborate lengths to cheat.

Layering a social construct on top of cryptocurrency
a la Bitshares is not a panacea for security, at least
as far I've seen.


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January 16, 2015, 10:19:48 PM
 #192

Nothing is a panacea for security, especially not single-idea mathematical constructs. 

We are innovating to engineer a series of transparent, interlocking "trust but verify" mechanisms to protect the rights of all owners.  Each of these mechanisms was introduced into the design to help solve problems we discovered when attempting to leverage the open source code of the giants upon whose shoulders we now stand.  BitShares was delayed six months while we worked from POW to POS to TAPOS to DPOS in an effort to overcome these limitations.  We kept at it until we reached the design we have today.  We will continue to innovate as necessary and release the results for others to build still higher upon.  I expect that 10 years from now folks won't even recognize the new solutions that will have evolved.

But, for now, we have taken the approach that, since all crypto currencies ultimately fall back on some combination of their developers and their largest hashers/forgers as the ultimate authorities to appeal to when something goes wrong, we might as well make that role explicit and place control of who serves that role directly in the hands of the token owners.

In pure POW and POS systems the wealthy assign themselves that role and there is nothing the smaller owners can do about it.

In DPOS, the small owners can easily gang up on the larger stakeholders to dismiss unacceptable developers and marketers and block signers with one click -- from the comfort of their easy chairs, and still get back to the game by the end of the commercials.

Show me another leading chain that provides a better way to regulate the influence of the largest pools of power, and we will do our best to incorporate whatever best practices we can learn from them.

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January 17, 2015, 12:38:33 AM
 #193


In pure POW and POS systems the wealthy assign themselves that role and there is nothing the smaller owners can do about it.

In DPOS, the small owners can easily gang up on the larger stakeholders to dismiss unacceptable developers and marketers and block signers with one click  

How so?

Large stakeholders still hold stake power, and they can vote in who they want, so what's the difference?
 
Say you have a big fish who owns 40% of the stake.

In DPOS, the big fish still can vote in 40% of the delegates, controlling 40% of the blocks.
In POS, the big fish directly controls 40% of the blocks.

Don't see any advantage.

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January 17, 2015, 01:20:37 AM
 #194


How so?

Large stakeholders still hold stake power, and they can vote in who they want, so what's the difference?
 
Say you have a big fish who owns 40% of the stake.

In DPOS, the big fish still can vote in 40% of the delegates, controlling 40% of the blocks.
In POS, the big fish directly controls 40% of the blocks.

Don't see any advantage.

That's not how approval voting works.  Each candidate delegate runs in a separate election.  The top 101 vote getters are hired.  Lose a few votes one afternoon and you are fired.

If there ever was a fish with 40%, then it would indeed take 41% of the remaining stakeholders to agree on an alternative slate.  

But they could do it.  

If they all agree on that alternative slate, the big fish would get zero delegates.  To the extent they spread out their vote among more than 101 candidates he may get a few or more.

If enough shareholders don't disagree or don't care about the selected slate, then the wishes of the person who owned 40% should be honored - as the person with the most at stake and the biggest interest in its success (and perhaps the most likely to invest in other parts of the ecosystem that benefit everybody.)

Long before this, someone would fork BitShares into a competitor with a sharedrop on everybody but the big fish.
Or, if it was a problem in perceived risk or performance, the ultimate remedy for the little guy is to simply sell.

To acquire such a large stake, the big fish would have to drive the share price up very high - to the delight of the little guy - and then risk getting cut out by a competing fork that would honor everyone but himself.

So, with DPOS there are many remedies if such a problem ever escalates.

Or, shareholders may not care if Donald Trump owns 40% since they can monitor the behavior of his delegates to detect any funny business.

In fact, if Donald ever announced he was acquiring 40% of BitShares, I think I might be HODLing for dear life.  Smiley
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January 17, 2015, 02:40:14 AM
 #195

If there ever was a fish with 40%, then it would indeed take 41% of the remaining stakeholders to agree on an alternative slate.  

But they could do it.  

If they all agree on that alternative slate, the big fish would get zero delegates.

Wait... ehm... didn't think of that before - but if you suggest that a good strategy can fully outsmart such a big stake, then this is much more likely to lead to an attack.
We can safely assume that a single owner of a big stake will vote much better coordinated than the rest. Add that this person could have also several delegates that get voted in by the rest of the stake. It follows: what you essentially did with the delegates is lower the amount of stake it takes for an attack.

This depends on two factors: clever math of an attacker, and stupid voting of the masses.
I would take those factors itself as a given. How low the necessary stake is, just depends on how bad they get.
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January 17, 2015, 03:26:37 AM
 #196

It is true that we can't empower the little guy while denying him his right to be stupid.  Smiley

But remember, we are not electing delegates with unlimited power to, um, vote for national health care or something.  All a delegate can do is sign blocks or not.  We can observe bad behavior in this very limited task and inform the less informed.  Then the community must arrive at a consensus of what to do about it - and hold the guilty accountable.

We know who they are.

The technical delegates hired by the blockchain publish their technical opinions.  All delegates, filtered by reputation, work to find a consensus themselves if bad blocks start showing up.  Failing that, individual investors can vote, sell, or fork a competitor.  All of these layers of defense deter bad behavior.  We are engineering a man-machine system and designing it to use all the resources and techniques at its disposal.

We view crypto tools as ways to assist humans in forming a real-time consensus and have embraced the idea that the ultimate control lies in humans handling the grave exceptions by consensus.  All other chains do this too.  We just admit it and design to manage it.

For example, if less than 90 delegates agree, all user wallets are given a yellow alert.  If below 80, the system automatically go to red alert. Worst case here is delegates declare a "bank holiday" and sort it all out until they get up above 90% consensus again.  Most banks are only open a small amount of time anyway - hence the term "bankers' hours".    So far, our up time has been nearly 24x7 since launch so we already beat the banks in that category.

The important thing is we that we achieve immunity from the corrupt abuses of the current financial system.

And that is our real competitor.

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January 17, 2015, 03:50:03 AM
 #197


How so?

Large stakeholders still hold stake power, and they can vote in who they want, so what's the difference?
 
Say you have a big fish who owns 40% of the stake.

In DPOS, the big fish still can vote in 40% of the delegates, controlling 40% of the blocks.
In POS, the big fish directly controls 40% of the blocks.

Don't see any advantage.

That's not how approval voting works.  Each candidate delegate runs in a separate election.  The top 101 vote getters are hired.  Lose a few votes one afternoon and you are fired.

If there ever was a fish with 40%, then it would indeed take 41% of the remaining stakeholders to agree on an alternative slate.  
 

I see.

Well if that is how it works, then
you would be correct that a big
stake holder could be overruled.

However...the trade-off comes in
the form of:

#1) as you pointed out, this kind
of scheme allows a large stakeholder
to control 100% of the blocks if
there isn't consensus among everyone
else, and it is hard to imagine there
wouldn't be some disagreement at
some point.
 
#2) it opens up attack for the 40%
fish to temporarily take 100%
control if he can create fake delegates
or bribe other stake holders.

and

#3) it incentives an arms
race in general for delegates slots
which could be competed for
more cheaply than acquiring
stake itself.



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January 17, 2015, 04:27:47 AM
 #198

I may be off with my assessment here, but this is what I think.

Since there is virtually no cost to forking the chain and excluding offending stake, large stakeholders must be very careful with offending the majority of individuals, regardless of how little they hold. It may even be the case that being a large stakeholder is so risky that nobody would want to be one. This gives DPOS a kind of game-theory self-defense system whereby either large stakeholders are forced to appeal to the majority of individuals, do nothing at all, or only vote with a fraction of their stake. Meanwhile, the majority of individuals will be eager to exclude large stakeholders, as the larger they are, the more they have to gain by doing so.

Thinking of things this way, perhaps a bigger issue is: Can we trust consensus to not cryptographically murder the wealth of large stakeholders, whether they are offending them or not, for their own benefit? Stakeholders can currently vote out delegates that are not bringing any value to the system. Will voting stakeholders out and redistributing their stake also become standard?

If the USA could collectively collaborate to non-violently fork out the top 1% of individuals who own 99% of the country's wealth, how long would it take to achieve 51% consensus, considering each individual would receive many thousands of dollars? Does DPOS create a way to incentivize its economy to have a reasonable Gini coefficient?
StanLarimer
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January 17, 2015, 05:02:59 AM
 #199


Well if that is how it works, then
you would be correct that a big
stake holder could be overruled.

However...the trade-off comes in the form of:

#1) hard to imagine there wouldn't be some disagreement at some point.
 
#2) if he can create fake delegates or bribe other stake holders.

#3)  delegates slots could be competed for more cheaply than acquiring stake itself.

Disagreements are fine.  Resolution is based on stake held.  If someone owns 99%, then its certainly within their rights to run the company however they see fit.  This is in fact how all public companies are run.  Minority shareholders have certain rights that are protected by the block chain, but the majority rules.  Otherwise, a worse situation occurs:  minority rules.  Smiley

Fake delegates bring us back to delegate reputations.  It's IMHO impossible to get a "fake" delegate elected.  (I've seen how hard it was to get even our most famous top developers elected.)  

If a bunch of people are getting elected that nobody else knows we have a flair lit tipoff that something is up!  Then somebody starts an uprising to organize the masses to vote them out.

Bribing other stakeholders sounds bad, but isn't it their right to use their assets to make money any way they can?

But bribing is a loser. How big a bribe do I need to do to get someone to risk their stake? And how do I make it stick? If someone is taking a bribe to vote for a nefarious agenda, they are probably immediately selling out before whatever happens happens.  As soon as they do, someone else is voting those shares, so it would be a pretty useless bribe.

We are counting on delegate slots becoming highly competitive to attract the best developers and marketers.  As they do, there is increased incentive to do the job honorably, to avoid losing the hard-won gig.  This works because they are sure to get caught if they produce a foul block.

Every delegate, myself included, gets subject to the "what have you done for us lately" question.  If there is a mystery delegate that no one knows you can bet that others are campaigning to take her place!  By raising up a lynch mob if necessary.  So the onus is on each delegate to do her job better than her competitors - and that includes producing blocks to spec.

In the end, every block that gets signed is traced back to the delegate who signed it.  If it doesn't meet spec, justice is swift and sure.
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January 17, 2015, 05:34:10 AM
 #200

I may be off with my assessment here, but this is what I think.

Since there is virtually no cost to forking the chain and excluding offending stake, large stakeholders must be very careful with offending the majority of individuals, regardless of how little they hold. It may even be the case that being a large stakeholder is so risky that nobody would want to be one. This gives DPOS a kind of game-theory self-defense system whereby either large stakeholders are forced to appeal to the majority of individuals, do nothing at all, or only vote with a fraction of their stake. Meanwhile, the majority of individuals will be eager to exclude large stakeholders, as the larger they are, the more they have to gain by doing so.

Thinking of things this way, perhaps a bigger issue is: Can we trust consensus to not cryptographically murder the wealth of large stakeholders, whether they are offending them or not, for their own benefit? Stakeholders can currently vote out delegates that are not bringing any value to the system. Will voting stakeholders out and redistributing their stake also become standard?

If the USA could collectively collaborate to non-violently fork out the top 1% of individuals who own 99% of the country's wealth, how long would it take to achieve 51% consensus, considering each individual would receive many thousands of dollars? Does DPOS create a way to incentivize its economy to have a reasonable Gini coefficient?

This is a fascinating line of thought and worthy of further discussion. 

Yes, but both sides need each other.  The big guys hold the market cap up and are likely to invest further in the ecosystem. The little guys keep the big guys honest.  Signers are those with the biggest consensus. The current system has network effect, so you don't fork off from it lightly.  If you abuse your influence, competition can arise and honor the stake of a subset of the stakeholders and take them away from you.

We are trying to form a balanced ecosystem with all the right feedback mechanisms to keep it balanced.  In some sense, this is a microcosm of the real world field of competition.  We are trying to engineer an incorruptibly fair playing field, at least much better than the current system. 

After that, let the market game theory begin!



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