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The senatorial governance of Bitcoin: making (de)centralized money

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Re: The senatorial governance of Bitcoin: making (de)centralized money

#11

Post by httpz »

jwilliams wrote: post #8
moneytide1 wrote: post #6

Once all 21 million coins are "produced" - what powered hardware will be required to manage transactions?

The same hardware. Miners get both a reward for mining (the fixed set of coins) as well as collecting fees. After they’re all mined, it’ll just be the fees.

But after all the blocks are mined, how does the blockchain even work?

Re: The senatorial governance of Bitcoin: making (de)centralized money

#12

Post by cryptowizard »

gl00pp wrote: post #4
cryptowizard wrote: post #2

If you have access to university libraries this academic article describes how Bitcoin production operates through centralized control points

Enlighten the graduates. How is BTC centralized. I'm waiting.

Bitcoin decision making is channeled down a funnel: Core Developers make suggestions and the Lead Developer (and those given commit access) sign off on those decisions. Those decisions are then voted for by miners who are (relatively) centralised in that roughly 5 mining pool companies control the vast majority of hashing power used to vote on those decisions. Meanwhile large wallet/exchange companies who control vast amounts of on-chain transactions can lobby miners to pick certain decisions by upgrading their nodes to reflect new rules (miners will want to follow large companies because they create liquidity for coins with the new rules and so they can sell their coins more easily and, theoretically, for a higher value). So while this is still a decentralised systems because multiple parties have a say, there are still lots of points of centralised control in the governance system. In other words, not everyone is equal. "Individual developers submit to those with commit access, individual miners submit to mining pool operators, and everyday users submit to Bitcoin companies" (478). The Lead Developer acts as a centralised decision maker, mining pools act like centralised voters, and Bitcoin companies act like centralised lobbyers. So there is a certain structure to Bitcoin governance.

Re: The senatorial governance of Bitcoin: making (de)centralized money

#13

Post by wmf »

httpz wrote: post #11
jwilliams wrote: post #8

Earlier quoted context omitted.

The same hardware. Miners get both a reward for mining (the fixed set of coins) as well as collecting fees. After they’re all mined, it’ll just be the fees.

But after all the blocks are mined, how does the blockchain even work?

Transaction fees.

Re: The senatorial governance of Bitcoin: making (de)centralized money

#14

Post by dmitrygr »

httpz wrote: post #11
jwilliams wrote: post #8

Earlier quoted context omitted.

The same hardware. Miners get both a reward for mining (the fixed set of coins) as well as collecting fees. After they’re all mined, it’ll just be the fees.

But after all the blocks are mined, how does the blockchain even work?

Blocks continue to be mined. It is just that the reward for doing so becomes zero

Re: The senatorial governance of Bitcoin: making (de)centralized money

#15

Post by EGreg »

Well, all projects can be changed by humans.

However, the problem with Bitcoin is that it's built on a monolithic blockchain, so it's actually got a bottleneck. The miner is the bottleneck. Every transaction in the world must be sent to every potential miner, making it even more inefficient.

In most other distributed systems, when you increase the number of computers, the amount of transactions the system can handle increases. Not so with these monolithic blockchains.

Ethereum has the same problem. Vitalik even admitted it this year: https://community.intercoin.org/t/vitalik-scalability-is-a-b...

We need systems that are sharded from day 1, such as MaidSAFE and Holochain. "Embarrassingly Parallel" systems!

Re: The senatorial governance of Bitcoin: making (de)centralized money

#17

Post by rolltiide »

are there any recommendations in this paper? Many times with cryptocurrency projects I've found it easier to get anonymous contributions added or considered more heavily compared to having a known persona, since the gatekeepers are not impartial and more often very emotionally driven

Re: The senatorial governance of Bitcoin: making (de)centralized money

#18

Post by filleokus »

wmf wrote: post #16

Note to commenters: In this context "Bitcoin production" is not mining; they're talking about the development of the protocol being centralized.

In the same vein: Could we perhaps have the titled changed to something more descriptive? "The senatorial governance of Bitcoin: making (de)centralized money" better describes that this is about the governing process of the protocol development rather than mining.

Re: The senatorial governance of Bitcoin: making (de)centralized money

#19

Post by theboywho »

httpz wrote: post #11
jwilliams wrote: post #8

Earlier quoted context omitted.

The same hardware. Miners get both a reward for mining (the fixed set of coins) as well as collecting fees. After they’re all mined, it’ll just be the fees.

But after all the blocks are mined, how does the blockchain even work?

Every time a block is mined, miners are paid in transaction fees + newly generated coins. After 21 million coins have been generated, miners will only be rewarded transaction fees => it doesn't mean blocks will stop being mined; blocks will keep being mined, but without generating new coins out of nowhere.

Re: The senatorial governance of Bitcoin: making (de)centralized money

#20

Post by cryptowizard »

EGreg wrote: post #15

Well, all projects can be changed by humans. However, the problem with Bitcoin is that it's built on a monolithic blockchain, so it's actually got a bottleneck. The miner is the bottleneck. Every transaction in the world must be sent to every potential miner, making it even more inefficient. In most other distributed systems, when you increase the number of computers, the amount of transactions the system can handle…

That's an interesting way of putting it. Scaling will always be a problem with monolithic records like you say. I have worked on a couple of distributed ledgers with sharding and these governance models seem to be more promising. Often there is some sort of democratic voting system for stakeholders when it comes to making change to the code which can be reduced by certain cryptoecnomic rules (e.g. demurrage fees for hoarders if it uses a proof of stake consensus). You're right though, its the fact that software needs to be updated by humans so that it stays relevant and reflects stakeholder interest over time that demands decision making. And this decision making often tends to materialise in (some sort of) centralised form due to the need to regulate and promotes good decisions (i.e. by experts). The same happens through Wikipedia moderating.
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