161–170 of 232 posts
I have a controversial view.. (more than) enough mining will still happen even if there were no block reward AND no fees. Why would somebody mine Bitcoin in that scenario? Because they hold Bitcoin. I imagine the average investor would be willing to spend around 2% of their holdings a year to “protect” their investment, I.e. make sure the network is functional and immune to attack. Which comes out to about the total…
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ETH2 proof of stake beacon chain shipped in December. There's tens of thousands of ETH2 validators live today. Proof of work is still in place for base chain, so ETH is a hybrid currently. But they'll be off proof of work within a year to year and a half. For blockchains as big and old as Bitcoin and Ethereum I understand migrating to a new consensus algorithm is no easy task and comes with risks. But it is doable. A…
If ETH is hybrid now, how much it helped the energy usage? Did it go down significantly compared to a year ago (even if measured in ETH)? Bitcoin had a halving, which was very sifnificant energy usage decrease measured in BTC (which caused the significant price increase).
It is not possible to adapt bitcoin as there is no governance (or a flawed one either accept what miners and few devs want or fractionate the community creating bch) , It is software, software needs to adapt, by definition.
I think the implicit idea that bitcoin will never change helps to grow now, as we get false sentiment of stability, But we are at the mercy of devs/miners.
If you think this is a concern, take a look at decred, is was born to be the best store of value, because it can adapt and evolve through governance, so it can last in time.
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It's difficult for the Bitcoin community to find consensus on changes to the consensus rules. We couldn't change a constant from 1MB to 2MB. I think changing PoW entirely is extremely unlikely to happen. It's much easier for the people who believe in PoS to sell their Bitcoin and buy Ethereum instead.
Or any of the other PoS coins. If you want to invest (which is a word I hesitate to use in the context of any cryptocurrency) in a PoS coin there are more mature ones. It would be interesting if someone would research why this hasn't already happened? It's not like that alternative hasn't been available for a long time now.
One of the assumptions the authors make in this paper is that miners can turn their hardware on and off quickly, and that they will benefit financially for doing so. Mainly by paying lower electricity bills. It turns out the really big miners don't pay for electricity the same way you or I do. Big miners sign long term contracts for continuous consumption of energy, and don't save any money for turning mining hardwar…
My understanding is that one reason more plants were built in the 60s was because electricity prices were fixed by regulators. That made financial modeling easier, because investors could legibly forecast their payback on the capital investment. When electricity moved to free floating price markets, it introduced much more risk and therefore increased the cost of capital.
Seems like nuclear power and bitcoin mining are a match made in heaven. Demand remains smooth and predictable, even from minute to minute. The marginal cost of electricity is near zero. Many of the large mining pools are so large and well capitalized that they could afford to commission a dedicated plant.
Why can't Bitcoin simply transition to proof of stake after mining dries up? Once there are few or no bitcoins left to mine then PoW is a lot of ceremony for very little security gain at that point (and perhaps opens up risks that this paper points out).
> simply transition to proof As opposed to Proof-of-Work, Proof-of-Stake is not as simple as it sounds. Any implementation faces a myriad of design challenges and potential attacks. Things like "nothing-at-stake", "costless simulation", "stake grinding", and "long-range attacks" [1]. And in the end, there is no objective truth about the state of the chain, as there is with PoW's simple longest chain rule. There is no…
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You're comparing want (saving) and utility (spending). They're contradictory. They have different purposes. A functioning money system needs to have: (1) A Store of Value (2) A Medium of Exchange (3) A Unit of Account. Bitcoin is mostly a Store of Value. It doesn't have the other 2 functions. We can try to fit all 3 into Bitcoin. The Gold Standard failed to do it. The US Dollar system is failing. Bitcoin will likely…
> The US Dollar system is failing. What makes you think that?
Why can't Bitcoin simply transition to proof of stake after mining dries up? Once there are few or no bitcoins left to mine then PoW is a lot of ceremony for very little security gain at that point (and perhaps opens up risks that this paper points out).
There is no such thing as “Proof of stake” to replace proof of work. Proof if work is a solution where you do not have to trust anyone, as the block is won by the person who finds the right math result, essentially a lottery. Proof if stake is either really proof of work that is less secure and obscured, or more often dimply giving the creators of the coin the power and your trust.... which reverses the entire point…
At some point, the mining rewards will dry up, as this paper points out. Then the game theory mechanics for BTC will change such that transaction ordering and execution become the main competition for miners to fight for, with some blocks being much more profitable than others despite electricity costs remaining static for each block. That's a huge problem, and PoW doesn't have the fix for that.
Ethereum's current proposal on this is to burn transaction fees. This is possible because ETH doesn't have a capped issuance, so block rewards will never dry up. Bitcoin doesn't have this option. It will have to, at some point in the future (maybe 20 years, I dunno), either give up 21 million capped supply or Proof-of-Work to sustain itself.
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> Gaming is the sole demand for all consoles and GPUs Well, no, mining cryptocurrency is a significant source of GPU demand; GPUs also have non-gaming, non-cryptocurrency utility.
cryptocurrency mining is mostly done using ASICs
Bitcoin mining is mostly only effective with ASICs, but cryptocurrency is more than just Bitcoin.