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Proof of stake is incapable of producing a consensus

yanmaani.github.io

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Re: Proof of stake is incapable of producing a consensus

#621

Post by javert »

meribold wrote: post #553
rufusroflpunch wrote: post #523

Earlier quoted context omitted.

No, not true. Nodes can literally just choose to use the version of software that provides the best money. You can’t choose to use the US monetary policy from 1960, for example. This has happened multiple times with attempted hard forks of Bitcoin which have failed because once you change the monetary policy once, the promise of hard money effect disappears. So the original monetary policy remains in place and the or…

I imagine the idea of a hard fork of Bitcoin may become more popular as the supply limit is approached and transaction fees go up. The current transaction fee is only a few dollars but the cost is over a hundred. Eventually the fee will have to cover the full cost and a hard fork may start to look more interesting. If this happens I can technically stay on the original protocol, but that would be rather pointless if…

The natural scenario is that as the mining reward goes down, hash rate will dwindle until mining is profitable again.

The only real problem with that is that with a small hash rate, bitcoin can be attacked more easily.

If bitcoin is the monetary backbone for many nations, they will subsidize miners to maintain the balance of power. That is the actual scenario that I'm optimistically predicting.

If bitcoin isn't the monetary backbone for many nations, by then, then it's probably a failure, and should probably be allowed to die.

It's also very possible that transactions fees alone actually will be sufficient to support a high enough amount of hash power to secure the network.

Re: Proof of stake is incapable of producing a consensus

#622

Post by xiphias2 »

paulgb wrote: post #354
xiphias2 wrote: post #36

Earlier quoted context omitted.

Renting out equipment for miners is dangerous, as an attack on the network can wipe out all their sunk costs. Bitcoin miner farms are very strongly incentivized to be aligned with the long term health of the system, so they try to play nice close to the ethos of Bitcoin (they learned enough from the blocksize wars that they can get burned if they go against Bitcoin)

If a halving forces a bunch of miners off the market (because their expected revenue drops below operating cost), there could be a huge glut of hardware flooding the market that is not profitable for honest mining but allows a bad actor to temporarily accumulate hashrate.

Bitcoin's price goes up faster than the effect of the halving (16x vs 0.5x every 4 years), and with the current chip shortage and slowdown of improvements miners generally plan for 4 years, but old, inefficient miners with low utilization can become an attack vector.

Re: Proof of stake is incapable of producing a consensus

#623

Post by yanmaani »

michaelsbradley wrote: post #399
yanmaani wrote: post #118

Earlier quoted context omitted.

> When you withdraw you are no longer allowed to sign anything. Allowed to by whom? Who's to punish me if I disobey them?

https://github.com/ethereum/annotated-spec/blob/master/phase... After withdrawal is completed, your node would no longer be in the set of active validators and from that time could not validly propose a block or submit an attestation (or, more accurately, be selected as a block proposer, etc.)

Yes, "validly" being the operative word here.

I can still propose blocks invalidly, you see. And then someone who doesn't already have the consensus (e.g. trying to sync) will have no way to tell which is legitimate.

This is the problem - you can't look at what the system does when everything's working as it should, you have to look at what happens when it's outside of the comfort zone.

Re: Proof of stake is incapable of producing a consensus

#624

Post by lottin »

seoaeu wrote: post #579
lottin wrote: post #511

Earlier quoted context omitted.

If you spend more tokens than the tokens that were spent mining the last two blocks you can erase the transactions in those blocks, but isn't that also the case with PoW?

You aren’t following. The hard fork lets me double spend the tokens from those blocks.

Indeed, I'm not following your argument.

Re: Proof of stake is incapable of producing a consensus

#625

Post by dathinab »

SilasX wrote: post #610
dathinab wrote: post #604

Earlier quoted context omitted.

You spend "safety of your stacked money while having stacked a lot of money" it's a scarce resource as if you over spend it you lose your money. And the more money you have stacked the less interest you have into braking the currency as it makes you lose that money.

But it’s not a scarce resource you spent. As the author says, you can sign multiple, contradictory stakings.

Which can (likely will) make you lose all the stacked money.

Re: Proof of stake is incapable of producing a consensus

#626

Post by mschuster91 »

gruez wrote: post #541
mschuster91 wrote: post #427

Earlier quoted context omitted.

> Flared gas in texas, for instance, could provide more power than the network currently uses. While the amount of gas that is flared off is immense (25-30% of the actual consumption of the US and Europe), the problem is that it is only flared off because there are no pipelines to transport the gas away and the amount that the small oil wells produce is too low to justify the cost. If it were for me I'd force oil wel…

>[...] and the amount that the small oil wells produce is too low to justify the cost. >If it were for me I'd force oil well operators to [....] Maybe it's too costly for a reason? Building power lines or pipelines to the middle of nowhere has economic and environmental costs as well, so top down legislation forcing every single well to do it might result in worse overall outcomes. For instance, the resources it take…

> For instance, the resources it takes to construct a pipeline/power line to the nearest town might be more than the electricity/methane that can be generated from the well.

Well, there already is a pipeline for the oil product (so the additional overhead for a small gas pipe isn't that huge) and an electric grid hookup for the pump. That can be used even for a small-scale electrical generator.

Re: Proof of stake is incapable of producing a consensus

#627

Post by toss1 »

dcow wrote: post #591
toss1 wrote: post #542

Earlier quoted context omitted.

Not quite Even if BTC and every other POW cryptocurrency converted this afternoon to 100% renewable energy use (and we ignore the carbon cost of manufacturing the hardware), it is STILL a huge climate problem. Why? 1) Because that ~1% of total energy consumption is being squandered on maintaining the cryptocurrency instead of any other use. Thus, it prevents those clean energy sources from displacing CO2-generating s…

You’ve created an impossible straw man: crypto is only running on renewables and the rest of the world isn’t because crypto hogs it all. That’s just not ever going to be reality.

Not at all

Even if 99% of the rest of the world is also running on renewables, Crypto is still diverting energy generation that could be decarbonized.

Once the world energy generation is fully de-carbonized, then it is a non-issue.

Re: Proof of stake is incapable of producing a consensus

#628

Post by EthanHeilman »

hedora wrote: post #616
comex wrote: post #606

Earlier quoted context omitted.

The history still needs to be signed by former stakers to be valid. The "nothing at stake" problem is that a staker might break the rules by signing two mutually incompatible histories. During the staking period, they are strongly disincentivized from doing this because anyone can present proof that they've done so, causing the network to punish them by taking away all the funds they staked. But once that period expi…

This is the “nothing at stake problem” from the article. Warren Buffet buys up 70% of the network, induces a network partition, and then double spends it all, signing both transaction histories. By the time he’s caught, he’s converted 2x the value of the POS network to POW bitcoins. Replace “warren buffet” with “crypto exchanges selling bundled securities”, and the above is not just plausible, it’s inevitable. The sa…

A trust assumption of PoS (Proof of Stake) is that >66% of the stake is honest. If you violate this trust assumption then yes PoS breaks. This is a similar trust assumption to requiring that 51% of the mining power in PoW (Proof of Work) is not malicious.

This risk can be mitigated:

1. The network should halt if a fork is detected. A fork with more than 66% of the stake behaving maliciously means a fundamental trust assumption of the network has been violated. Stop everything! Let humans figure out what is going on. I'm not saying every PoS system WILL halt under these circumstances, but as a countermeasure they SHOULD be designed to halt and value safety over partition resilience. Thus, an attacker forking a PoS must never allow parties to see either side of the fork. If a party notices a fork occurs, they will halt and can't be double spent against.

2. Following from 1, how do you prevent parties from communicating and discovering that a fork is occurring? Are you a tier-1 ISP and can control all internet traffic? You can defend against such attacks by making it very hard to hide the presence of a fork via redundant communication mechanisms. For instance the Bitcoin blockchain is broadcasted via satellite, a PoS blockchain could do that as well.

3. Additionally you can require that stakers lock their stake for long periods of time e.g., 6 months. This means that if an attacker wants to perform this attack and truly have nothing at stake they must cause a fork in the chain before the 6-months ago mark. Parties who are up to date with the latest chain are not vulnerable since they have already accepted the consensus history of chain. New parties who are syncing for the first time would be vulnerable, however clients could be programmed to have hardcoded 6th month checkpoints or clients could check block explorers and halt if a fork is detected.

Re: Proof of stake is incapable of producing a consensus

#629

Post by p2p_astroturf »

This article is terrible and does not explain how proof of stake works let alone how it's broken, but links to another (probably better article on etheruem.org). back to studying it for myself, then. I literally have a headache after reading the bitcoin analogy and trying to guess which parts of the analogy I will need to remember for later in the article (hint: none). It would have been simpler to just explain what a nonce and hash is.

Re: Proof of stake is incapable of producing a consensus

#630

Post by amelius »

lukifer wrote: post #590
kwertyoowiyop wrote: post #437

Earlier quoted context omitted.

PoB: Proof of Bullshit

PoW should actually stand for Proof of Waste. It's not even unprecedented in nature: many species will intentionally waste energy or resources to demonstrate mating fitness, as with a peacock's tail. https://en.wikipedia.org/wiki/Signalling_theory

... or people going to the gym.

The problems start, of course, when you take a concept to its logical extreme.

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