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Ethereum Proof-of-Stake

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Re: Ethereum Proof-of-Stake

#131

Post by olalonde »

haxiomic wrote: post #107
SilverBirch wrote: post #101

Earlier quoted context omitted.

I absolutely agree we should build infrastructure that allows people within oppressive regimes options with which they can resist, escape and co-ordinate. Which is why this infrastructure, which is clearly designed to empower those regimes, is bad. Are North Koreans using crypto-currencies? Maybe, it doesn't seem like it. Is the North Korean regime using crypto-currencies? Absolutely, we repeatedly see the North Kore…

Turns out North Korea are using crypto! To fund missile programs https://www.bbc.com/news/world-asia-60281129.amp The more I think on these things, the more I think trust is a feature, not a bug

Do you extend that thought to the Internet as well? The web is undoubtedly helpful to North Korea, probably more so than crypto.

Re: Ethereum Proof-of-Stake

#132

Post by douglaswlance »

chickenpotpie wrote: post #79
gregwebs wrote: post #48

Earlier quoted context omitted.

Current Bitcoin usage is literally a rounding error of global energy usage (0.1%) and if wildly successful would still be https://www.lynalden.com/bitcoin-energy/ If Bitcoin moved to PoS it would be fundamentally different. It might work for other coins since they aren't as decentralized. > Instead, proof-of-stake mainly seems less suitable for a decentralized and censorship-resistant global monetary asset, especiall…

> Current Bitcoin usage is literally a rounding error of global energy usage (0.1%) and if wildly successful would still be https://www.lynalden.com/bitcoin-energy/ That author doesn't seem to actually understand the scale of financial transactions in the world. Right now, there are about 300,000 Bitcoin transactions per day. The author defines Bitcoin being "wildly successful" as a 20x increase. Right now there are…

That is assuming it scales linearly, which is not necessarily true. It would only be true if the value of BTC went up such that more miners were incentivized to join the system. In BTC, there isn't a 1:1 direct correlation between energy spent and transactions processed.

Re: Ethereum Proof-of-Stake

#133

Post by f38zf5vdt »

rglullis wrote: post #106
haarts wrote: post #66

Earlier quoted context omitted.

How does it work?

PoS does not give you any power to change the rules of the system, it only makes sure that those who are invested in the system get (slightly) rewarded for good behavior and (heavily) penalized for bad behavior.

This is the prevailing theory but in practice I'm not sure it will work. Ethereum forked early on due to someone stealing some money from The DAO. In reality the exchanges/large corporate owners will be the ones doing network validation, and they will be the ones most easily leaned on by their respective governments. If a government(s) says "you need to veer off this version of Ethereum and run your own", the chain will fork. It looks to me that proof of stake defends against small time actors, not activist shareholders or government regulation.

Re: Ethereum Proof-of-Stake

#134

Post by kkielhofner »

chickenpotpie wrote: post #79
gregwebs wrote: post #48

Earlier quoted context omitted.

Current Bitcoin usage is literally a rounding error of global energy usage (0.1%) and if wildly successful would still be https://www.lynalden.com/bitcoin-energy/ If Bitcoin moved to PoS it would be fundamentally different. It might work for other coins since they aren't as decentralized. > Instead, proof-of-stake mainly seems less suitable for a decentralized and censorship-resistant global monetary asset, especiall…

> Current Bitcoin usage is literally a rounding error of global energy usage (0.1%) and if wildly successful would still be https://www.lynalden.com/bitcoin-energy/ That author doesn't seem to actually understand the scale of financial transactions in the world. Right now, there are about 300,000 Bitcoin transactions per day. The author defines Bitcoin being "wildly successful" as a 20x increase. Right now there are…

The average US adult does 2.3 financial transactions per day.

The all time high number of bitcoin network transactions in a 24h period is a bit less than 500k.

The busiest day for Bitcoin usage worldwide is roughly equivalent to the population of Modesto, CA.

Blockchain occupies so much of the conversation and generates such incredible amounts of hype very few people truly understand just how insignificant it is in terms of not only the global financial system but also the internet. As you say billions of users and billions of transactions.

It's almost as though people forget these networks are completely public and open - adoption numbers for any chain are a blockchain explorer away.

Re: Ethereum Proof-of-Stake

#135

Post by olalonde »

__alexs wrote: post #78
clippablematt wrote: post #68

Earlier quoted context omitted.

You should understand that this is a very USA centred opinion. There’s a whole big world of different cultures and politics, and it is possible to believe there are other approaches where we reject violence and authority. It’s the usual “you’re helping drug dealers/terrorists/North Korea, but what about the children?!” state simping that ignores the violence of the existing systems, and ignores the billions of people…

Providing technology to help dissidents is clearly a separate activity from providing technology to help the entire economy of your enemies.

That's the root of the problem, it usually isn't.

Re: Ethereum Proof-of-Stake

#136

Post by rglullis »

hellcow wrote: post #118
rglullis wrote: post #106

Earlier quoted context omitted.

PoS does not give you any power to change the rules of the system, it only makes sure that those who are invested in the system get (slightly) rewarded for good behavior and (heavily) penalized for bad behavior.

That “bad behavior” is precisely what the above poster meant by “changing the rules of the system.” If you or a syndicate have a large enough stake, you can manipulate the transactions which occur.

"By large enough", you mean 67% to attempt to do it with some chance of success, and if it fails it gets slashed.

Not to mention that no one would be interested in using any network where this level of centralization could pose a real threat, and the most likely outcome of such a scenario would be a loss of the value of the native token.

Re: Ethereum Proof-of-Stake

#137

Post by rglullis »

f38zf5vdt wrote: post #133
rglullis wrote: post #106

Earlier quoted context omitted.

PoS does not give you any power to change the rules of the system, it only makes sure that those who are invested in the system get (slightly) rewarded for good behavior and (heavily) penalized for bad behavior.

This is the prevailing theory but in practice I'm not sure it will work. Ethereum forked early on due to someone stealing some money from The DAO. In reality the exchanges/large corporate owners will be the ones doing network validation, and they will be the ones most easily leaned on by their respective governments. If a government(s) says "you need to veer off this version of Ethereum and run your own", the chain w…

> If a government(s) says "you need to veer off this version of Ethereum and run your own.

Which governments, saying to whom? And how would they enforce it? What would be the consequences for those that didn't comply?

Re: Ethereum Proof-of-Stake

#138

Post by icevoid »

Leaving behind the technical details and the energy consumption aspect, it seems to me that the main economic difference between PoW and PoS is that in the former miners are forced to sell their earned tokens due to a high cost of keeping their equipment up and running. This sounds like a healthier approach.

Whereas PoS validators don't have the same burden, therefore they'd naturally tend to simply increase their shares.

Re: Ethereum Proof-of-Stake

#139

Post by olalonde »

WJW wrote: post #95
capableweb wrote: post #59

Earlier quoted context omitted.

Yes, if you actively and knowing break the law, you might get punished for it. Not sure what's new here? If you don't want to connect to North Korea, block connections coming from North Korea, it's like one or two commands of iptables.

The sanctions go a little bit further than that though. Financial institutions are not merely blocked from accepting transactions from the IP region of North Korea, but actually from doing business with a whole list of companies and individuals with ties to NK. To comply with the sanctions regulation you would need to have a lookup service listing the owner of every wallet and for every transaction you validate, chec…

It was actually ruled in 2014 that virtual currency miners are not money transmitters[0].

[0] https://www.fincen.gov/sites/default/files/news_release/2014...

Re: Ethereum Proof-of-Stake

#140

Post by ETH_start »

drdrek wrote: post #70
ETH_start wrote: post #47

Earlier quoted context omitted.

>>the more you have of the capital the more you influence the system? what a novel concept! That is exactly how Proof of Work works as well. What makes PoW and PoS implementations like Ethereum's capture resistant is that they are governance-free, so capital is NOT used to influence governance. It is only used as a signal that is costly so as to prevent Sybil attacks.

The "Move" to POS breaks the myth of the system being immutable and "governance-free". The people with a lot of stake in the system can change or prevent change to the system. One of the major reasons that POS takes so long to implement is that individuals and syndicates that have invested a lot of money in to POW infrastructure block it and warn that it "doing it hastily" will harm the stability of the system. And t…

>>The people with a lot of stake in the system can change or prevent change to the system.

This is very misinformed. There is no governance by stake vote in Ethereum. The protocol is immutable absent a user willingly updating their node software to run a different protocol.

Stake is used exactly the same way hash generation hardware is used in PoW: to determine what share of blocks a person produces. This is safe in both Ethereum PoS and PoW as long as the assumption that 51% of block generation capital (stake, and hashing hardware, respectively) is controlled by honest parties holds true.

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