31–40 of 205 posts
Earlier quoted context omitted.
The answer is that it isn't, and none of these systems ever were. They're distributed, not decentralized. And this distinction, and the refusal to acknowledge it is what put me off crypto entirely.
Same here, market(s) over time will be cornered without control policies that counter monopoly.
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Ya I wonder if we’ll start seeing attempts to corner the market in PoS.
Computing power is just a proxy for capital/resources. Why not be more efficient and use the capital directly and save power in the meanwhile. Current market cap of ETH is ~$324B, thus getting 50.1% of ETH would require $162.3B in capital. However, as soon as you start acquiring ETH the price will increase, especially at those large volumes. It would be insanely hard to come up with enough resources to buy enough ETH…
It's kinda like taking over a condo building on a much larger scale: the people you buy out first can charge a premium; by the end, you set the terms.
Can someone explain to me how PoS is not centralized? The whole point of crypto and the blockchain is decentralization, no? I feel like crypto/blockchain will end up looking nothing like how it was intended, and be regulated to the point that it's just the next iteration of the traditional banking system, where the current power holders continue holding the power. Maybe I was naive to ever think it would be any diffe…
The key distinction is that PoW is permissionless, whereas PoS is permissioned. Bitcoin is secured by hashpower, which is produced by physical capital outside the network. Nobody needs to ask for permission to start hashing and trade kilowatts for sats. PoS networks are secured by on-chain assets. This means you can't "mine" it without first buying tokens from someone who already owns them. You need permission from a…
This is an incorrect explanation of what a permissioned blockchain is. A permissioned blockchain is one in which the ability to add blocks is limited to a certain collection of entities whose public keys are hard coded into the blockchain's consensus mechanism. We don't say that needing to buy tokens constitutes needing "permission" any more than you need permission from a chip manufacturer to buy ASICs to mine a PoW cryptocurrency.
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In practice PoW is pretty centralized also. Most of the mining is done by those who have the capital to set up massive ASIC/GPU farms.
There are coins like Monero that are ASIC-resistant and can only be mined with CPU, not GPU.
Can someone explain to me how PoS is not centralized? The whole point of crypto and the blockchain is decentralization, no? I feel like crypto/blockchain will end up looking nothing like how it was intended, and be regulated to the point that it's just the next iteration of the traditional banking system, where the current power holders continue holding the power. Maybe I was naive to ever think it would be any diffe…
The key distinction is that PoW is permissionless, whereas PoS is permissioned. Bitcoin is secured by hashpower, which is produced by physical capital outside the network. Nobody needs to ask for permission to start hashing and trade kilowatts for sats. PoS networks are secured by on-chain assets. This means you can't "mine" it without first buying tokens from someone who already owns them. You need permission from a…
Only in the most pedantic sense of 'permission'. There will always be thousands of disparate parties, across numerous markets, with offers to sell their ETH. It will never be harder to procure ETH than to procure hash-generation hardware.
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What does it matter what the technology supports if it incentivizes the community to consolidate? Penalties for being offline and slashing (for misconfigured nodes) are a massive incentive for nodes to centralize
On the contrary, penalties are higher the more nodes go out at the same time. If you centralize you expose yourself to higher penalties if something goes awry. The incentives of the system are designed to prevent centralization.
Can someone explain to me how PoS is not centralized? The whole point of crypto and the blockchain is decentralization, no? I feel like crypto/blockchain will end up looking nothing like how it was intended, and be regulated to the point that it's just the next iteration of the traditional banking system, where the current power holders continue holding the power. Maybe I was naive to ever think it would be any diffe…
The answer is that it isn't, and none of these systems ever were. They're distributed, not decentralized. And this distinction, and the refusal to acknowledge it is what put me off crypto entirely.
Earlier quoted context omitted.
Computing power is just a proxy for capital/resources. Why not be more efficient and use the capital directly and save power in the meanwhile. Current market cap of ETH is ~$324B, thus getting 50.1% of ETH would require $162.3B in capital. However, as soon as you start acquiring ETH the price will increase, especially at those large volumes. It would be insanely hard to come up with enough resources to buy enough ETH…
I wonder if a state actor could pull it off more cheaply. Start buying large amounts while letting it leak that you're going to take over the network. See if enough people will panic-sell on the leak to drop the price of your takeover. It's kinda like taking over a condo building on a much larger scale: the people you buy out first can charge a premium; by the end, you set the terms.
The price goes up, you've just made it more expensive for yourself to take over the network.
If you were to attempt to take over you'd be better to do so in silence. However, it would be hard to hide that kind of control and wealth when every information on the network is publicly available.
Can someone explain to me how PoS is not centralized? The whole point of crypto and the blockchain is decentralization, no? I feel like crypto/blockchain will end up looking nothing like how it was intended, and be regulated to the point that it's just the next iteration of the traditional banking system, where the current power holders continue holding the power. Maybe I was naive to ever think it would be any diffe…
The key distinction is that PoW is permissionless, whereas PoS is permissioned. Bitcoin is secured by hashpower, which is produced by physical capital outside the network. Nobody needs to ask for permission to start hashing and trade kilowatts for sats. PoS networks are secured by on-chain assets. This means you can't "mine" it without first buying tokens from someone who already owns them. You need permission from a…
This is not true. PoS has many design flavours and the one Ethereum is planning on implementing includes random selection of validators and the amount staked has no influence on the inclusion or the vote "weight".
Also with PoS an attacker will always incur economic losses similar to having your mining rig burning down if you were to try to foce a bad block through. In PoW networks attackers can keep on mixing attacks with producing normal blocks and remain profitable