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Ugh. He completely misunderstands what PoW (or PoS) are for. The entire point of PoW is deciding between two valid & correct blockchain states. Alice owns a bi

Ugh. He completely misunderstands what PoW (or PoS) are for. The entire point of PoW is deciding between two valid & correct blockchain states. Alice owns a bitcoin. Alice validly signs a transaction transferring that bitcoin to Bob. Alice also validly signs a transaction transferring that same bitcoin to Charles. WHICH IS CORRECT? Neither is a forgery. Both signatures are valid. If Dave downloads the blockchain, or receives both transactions, he can't just look at them and determine one of them is fake. Neither is fake. He needs a way of arbitrating who actually has the bitcoin now - Bob or Charles. PoW is that arbitration process. Dave looks at the competing blockchains (one with Bob having received it, and one with Charles having received it) and can trust that everyone in the world will respect the chain with greater PoW behind it. Paul's system has no way of addressing this other than "trust the central authority to process transactions in the order they receive them". Thanks, pal, that's called e-cash, and was invented by David Chaum in 1983.

wmf 9y ago
I think the point is that, hypothetically, some non-financial systems don't require ordering or conflict resolution and thus such systems don't need PoW.
- pfraze 9y ago
  Actually I appreciate the defense, but that's not what I'm claiming. I'm claiming that decentralized consensus gives only a minor gain over a single node maintaining a well-monitored blockchain. Single nodes don't have the problems of uncertain ordering or conflict resolution because they can provide strict consensus.
  - dozzie 9y ago
    > I'm claiming that decentralized consensus gives only a minor gain over a single node maintaining a well-monitored blockchain. Do you also claim that a one-way hash function only gives a minor gain over a B-tree? Because document timestamping and establishing consensus are different problems.
    - pdkl95 9y ago
      A proper hash function provides a lot more than a timestamp. A service with a B-tree (or other traditional database) can rewrite history. Even if have a copy of the db, it's difficult to prove that your version is the service rewrote their version. If a service wrote all transactions into a log in a way that allows for easy verificatio9n of the validity (including order), and the parties using the service regularly check that log, those parties can demonstrate that the service is acting correctly. Questions about transaction order and consensus are separate problems, which may not be necessary, depending on the nature of the service. The point, I believe, is that some problems only need some of the features usually associated with "blockchains". We are only beginning to find the interesting uses for Merkle trees, and thus shouldn't blindly use the current bitcoin-style design when the current problem could use something similar,
      - dozzie 9y ago
        > A proper hash function provides a lot more than a timestamp. A service [...] can rewrite history. I think you should verse yourself in cryptography before any discussion about it, including talking about blockchain. You seem not to understand what cryptographic timestamp is and what purpose it serves. Wikipedia has a nice introductory article approachable by a layman under "trusted timestamping" title.
- DINKDINK 9y ago
  >hypothetically, some non-financial systems don't require ordering or conflict resolution and thus such systems don't need PoW. If you don't need trustless time ordering of data, you don't need a blockchain. You just need... a database
pfraze 9y ago
> Paul's system has no way of addressing this other than "trust the central authority to process transactions in the order they receive them". Thanks, pal, that's called e-cash, and was invented by David Chaum in 1983. Flatly wrong. Decentralized consensus is not a necessity to create trustless operation. Monitoring service operation via a secure ledger provides trustless operation. As I said, the point of PoW is to provide strict transactional consistency in a decentralized network. You're just describing that process mechanically.
- deleted 9y ago
  [deleted]
- wyldfire 9y ago
  The function of mining is not limited to the PoW, it's also an arbitration mechanism for decentralized minting/scheduled inflation. The block reward incentivizes participants. Why should I run a monitor node for this new cryptocoin? Who will allocate the coins and how? > Am I certain that I need strict global consensus? Perhaps not but IMO it makes things much simpler to design as a result.
- bmcusick 9y ago
  Hi Paul. I'm Brock. I hope we're not talking at past each other, but I read your post as proposing a system where there's a central party that computes transactions "in the open" in a way that third party observers can verify. That's hardly useless, but it's not a replacement for Proof of Work. PoW is for decentralizing the ability to choose between competing valid blockchains. It prevents double-spending by making the benefit of double-spending (the value of the your transaction) far less than the cost of double-spending (the electrical cost of 51% of the mining power for 1 hour or so). Your system uses a centralized host (see "Services with Secure Ledgers", paragraph 2), and (I presume) third-party observers can verify a "secure ledger" by seeing which one has been more recently signed and time-stamped by the single host. I mean, sure, centrally hosted servers are more efficient than Proof of Work. No one who know what they're talking about disputes that. But the whole point of PoW is to allow decentralization without a single host.
  - 9y ago
rocqua 9y ago
There is value in a blockchain beyond a ledger of currency, and some of that value still remains when using a centralized service. Specifically, if you want to offer a service where you can guarantee non-repudiation a centralized blockchain is a great solution. By non-repudiation, in the scenario of a double-spend whomever signed both transactions is 'on the hook' for both. This doesn't work for currency but works for systems where it is sufficient to prove your servicer screwed you over.
- runeks 9y ago
  Where does the blockchain come in? As long as you have a signature from the central authority over two conflicting transactions, you can prove it has defrauded you. Blockchains specifically solve decentralized consensus. It’s expensive and slow compared to using a central authority, but the advantage is that the system doesn’t suffer from a central point of failure.
  - dozzie 9y ago
    > Blockchains specifically solve decentralized consensus. Wrong. Blockchains specifically timestamp documents. Consensus is a different problem and blockchains don't even touch that.
3pt14159 9y ago
What I do not understand is why we couldn't build this onto a web of trust + proof of stake. It may require some more state during resolution, and might even require falling back to automatic service denial if there is a severe network interruption (say in the event of nuclear war), but I can't figure out why we couldn't have miners just sign a growing dag of transactions and once a subset of the dag is accepted by 51% of the stake that network can prune the excess data (all the signatures). Work timestamps into the signature process and pin the keys used to sign the dag as only those belonging outside the current resolution. If a key is used to sign a transaction that conflicts with it's own "Verified & Locked" signature then it's coins are burned, including for it's own transaction. So in your example, if Alice signs both transactions and she doesn't have the funds to fulfil both of them the transaction causes Alice to lose 100% of her money. I'm sure there is a reason, and I vaguely recall some people talking about proof of stake a couple years ago, but I'm surprised we're still melting icecaps running ASICs out of China for new coins.
- runeks 9y ago
  > What I do not understand is why we couldn't build this onto a web of trust + proof of stake. Because the incentives of nodes in a web of trust is not to tell the truth about how much money they have; their incentive is to prefer whichever chain says they have the most money. With proof-of-stake, an arbitrary number of valid chains can be created from scratch in no time. How do we decide which is the right one? All nodes will prefer the chain that says they’re the richest, and the nodes that most efficiently can coordinate their lying will end up with all the money. Proof-of-stake solves the wrong problem: the problem isn’t to decide who gets to extend the chain, the problem is deciding which chain to extend in the first place (there can be millions of valid PoS-chains).
- bmcusick 9y ago
  > I can't figure out why we couldn't have miners just sign a growing dag of transactions and once a subset of the dag is accepted by 51% of the stake that network can prune the excess data (all the signatures) Because of Sybil attacks. > So in your example, if Alice signs both transactions and she doesn't have the funds to fulfil both of them the transaction causes Alice to lose 100% of her money. Remember, the goal isn't to punish Alice. She's losing 100% of the bitcoin no matter what happens. The goal is to assure Bob (or Charles) that the transaction they receive will be recognized as valid by the rest of the world. If you're Bob, and you know that Alice can invalidate the transaction (e.g., burn the bitcoin you just received) by signing a second transaction in the future, why would you ever accept Bitcoin? Don't punish Alice. Assure Bob.
DigitalJack 9y ago
Hey said this about proof of work.. is it wrong? It sounded good to me, but I never got into blockchain stuff. >What is proof-of-work? Proof-of-work is a system for establishing “decentralized consensus.” Agreeing about the order of events is very difficult in computer networks, especially if you can’t trust the other computers involved. Unfortunately, it’s also very hard to establish trust in a global network which aims to provide open participation. So, we need a way to agree on the order of events without establishing trust. Proof-of-work solves that problem by putting the network on a trustworthy clock. It’s a kind of computation which takes a predictable amount of time to run, and which can’t be forged by a bad actor. With proof-of-work, you can have multiple computers make additions to a blockchain without having them trust each other. That’s decentralized consensus. Decentralized consensus is intended to mean that one entity can’t control the blockchain network. Any newcomer can participate, and ownership is equally distributed among the participants.
- runeks 9y ago
  > Proof-of-work solves that problem by putting the network on a trustworthy clock. It’s a kind of computation which takes a predictable amount of time to run, and which can’t be forged by a bad actor. That’s not right. PoW takes a completely unpredictable amount of time. It’s not about a clock ticking, it’s about making the presence of two incompatible versions of history as expensive as possible, thus forcing the network into consensus.
  - dozzie 9y ago
    There's more wrong statements in the quote, like blockchain solving consensus (it's not, it's a document timestamping).

wmf 9y ago

I think the point is that, hypothetically, some non-financial systems don't require ordering or conflict resolution and thus such systems don't need PoW.

pfraze 9y ago
Actually I appreciate the defense, but that's not what I'm claiming. I'm claiming that decentralized consensus gives only a minor gain over a single node maintaining a well-monitored blockchain. Single nodes don't have the problems of uncertain ordering or conflict resolution because they can provide strict consensus.
- dozzie 9y ago
  > I'm claiming that decentralized consensus gives only a minor gain over a single node maintaining a well-monitored blockchain. Do you also claim that a one-way hash function only gives a minor gain over a B-tree? Because document timestamping and establishing consensus are different problems.
  - pdkl95 9y ago
    A proper hash function provides a lot more than a timestamp. A service with a B-tree (or other traditional database) can rewrite history. Even if have a copy of the db, it's difficult to prove that your version is the service rewrote their version. If a service wrote all transactions into a log in a way that allows for easy verificatio9n of the validity (including order), and the parties using the service regularly check that log, those parties can demonstrate that the service is acting correctly. Questions about transaction order and consensus are separate problems, which may not be necessary, depending on the nature of the service. The point, I believe, is that some problems only need some of the features usually associated with "blockchains". We are only beginning to find the interesting uses for Merkle trees, and thus shouldn't blindly use the current bitcoin-style design when the current problem could use something similar,
    - dozzie 9y ago
      > A proper hash function provides a lot more than a timestamp. A service [...] can rewrite history. I think you should verse yourself in cryptography before any discussion about it, including talking about blockchain. You seem not to understand what cryptographic timestamp is and what purpose it serves. Wikipedia has a nice introductory article approachable by a layman under "trusted timestamping" title.
DINKDINK 9y ago
>hypothetically, some non-financial systems don't require ordering or conflict resolution and thus such systems don't need PoW. If you don't need trustless time ordering of data, you don't need a blockchain. You just need... a database

pfraze 9y ago

> Paul's system has no way of addressing this other than "trust the central authority to process transactions in the order they receive them". Thanks, pal, that's called e-cash, and was invented by David Chaum in 1983. Flatly wrong. Decentralized consensus is not a necessity to create trustless operation. Monitoring service operation via a secure ledger provides trustless operation. As I said, the point of PoW is to provide strict transactional consistency in a decentralized network. You're just describing that process mechanically.

deleted 9y ago
[deleted]
wyldfire 9y ago
The function of mining is not limited to the PoW, it's also an arbitration mechanism for decentralized minting/scheduled inflation. The block reward incentivizes participants. Why should I run a monitor node for this new cryptocoin? Who will allocate the coins and how? > Am I certain that I need strict global consensus? Perhaps not but IMO it makes things much simpler to design as a result.
bmcusick 9y ago
Hi Paul. I'm Brock. I hope we're not talking at past each other, but I read your post as proposing a system where there's a central party that computes transactions "in the open" in a way that third party observers can verify. That's hardly useless, but it's not a replacement for Proof of Work. PoW is for decentralizing the ability to choose between competing valid blockchains. It prevents double-spending by making the benefit of double-spending (the value of the your transaction) far less than the cost of double-spending (the electrical cost of 51% of the mining power for 1 hour or so). Your system uses a centralized host (see "Services with Secure Ledgers", paragraph 2), and (I presume) third-party observers can verify a "secure ledger" by seeing which one has been more recently signed and time-stamped by the single host. I mean, sure, centrally hosted servers are more efficient than Proof of Work. No one who know what they're talking about disputes that. But the whole point of PoW is to allow decentralization without a single host.
- 9y ago

rocqua 9y ago

There is value in a blockchain beyond a ledger of currency, and some of that value still remains when using a centralized service. Specifically, if you want to offer a service where you can guarantee non-repudiation a centralized blockchain is a great solution. By non-repudiation, in the scenario of a double-spend whomever signed both transactions is 'on the hook' for both. This doesn't work for currency but works for systems where it is sufficient to prove your servicer screwed you over.

runeks 9y ago
Where does the blockchain come in? As long as you have a signature from the central authority over two conflicting transactions, you can prove it has defrauded you. Blockchains specifically solve decentralized consensus. It’s expensive and slow compared to using a central authority, but the advantage is that the system doesn’t suffer from a central point of failure.
- dozzie 9y ago
  > Blockchains specifically solve decentralized consensus. Wrong. Blockchains specifically timestamp documents. Consensus is a different problem and blockchains don't even touch that.

3pt14159 9y ago

What I do not understand is why we couldn't build this onto a web of trust + proof of stake. It may require some more state during resolution, and might even require falling back to automatic service denial if there is a severe network interruption (say in the event of nuclear war), but I can't figure out why we couldn't have miners just sign a growing dag of transactions and once a subset of the dag is accepted by 51% of the stake that network can prune the excess data (all the signatures). Work timestamps into the signature process and pin the keys used to sign the dag as only those belonging outside the current resolution. If a key is used to sign a transaction that conflicts with it's own "Verified & Locked" signature then it's coins are burned, including for it's own transaction. So in your example, if Alice signs both transactions and she doesn't have the funds to fulfil both of them the transaction causes Alice to lose 100% of her money. I'm sure there is a reason, and I vaguely recall some people talking about proof of stake a couple years ago, but I'm surprised we're still melting icecaps running ASICs out of China for new coins.

runeks 9y ago
> What I do not understand is why we couldn't build this onto a web of trust + proof of stake. Because the incentives of nodes in a web of trust is not to tell the truth about how much money they have; their incentive is to prefer whichever chain says they have the most money. With proof-of-stake, an arbitrary number of valid chains can be created from scratch in no time. How do we decide which is the right one? All nodes will prefer the chain that says they’re the richest, and the nodes that most efficiently can coordinate their lying will end up with all the money. Proof-of-stake solves the wrong problem: the problem isn’t to decide who gets to extend the chain, the problem is deciding which chain to extend in the first place (there can be millions of valid PoS-chains).
bmcusick 9y ago
> I can't figure out why we couldn't have miners just sign a growing dag of transactions and once a subset of the dag is accepted by 51% of the stake that network can prune the excess data (all the signatures) Because of Sybil attacks. > So in your example, if Alice signs both transactions and she doesn't have the funds to fulfil both of them the transaction causes Alice to lose 100% of her money. Remember, the goal isn't to punish Alice. She's losing 100% of the bitcoin no matter what happens. The goal is to assure Bob (or Charles) that the transaction they receive will be recognized as valid by the rest of the world. If you're Bob, and you know that Alice can invalidate the transaction (e.g., burn the bitcoin you just received) by signing a second transaction in the future, why would you ever accept Bitcoin? Don't punish Alice. Assure Bob.

DigitalJack 9y ago

Hey said this about proof of work.. is it wrong? It sounded good to me, but I never got into blockchain stuff. >What is proof-of-work? Proof-of-work is a system for establishing “decentralized consensus.” Agreeing about the order of events is very difficult in computer networks, especially if you can’t trust the other computers involved. Unfortunately, it’s also very hard to establish trust in a global network which aims to provide open participation. So, we need a way to agree on the order of events without establishing trust. Proof-of-work solves that problem by putting the network on a trustworthy clock. It’s a kind of computation which takes a predictable amount of time to run, and which can’t be forged by a bad actor. With proof-of-work, you can have multiple computers make additions to a blockchain without having them trust each other. That’s decentralized consensus. Decentralized consensus is intended to mean that one entity can’t control the blockchain network. Any newcomer can participate, and ownership is equally distributed among the participants.

runeks 9y ago
> Proof-of-work solves that problem by putting the network on a trustworthy clock. It’s a kind of computation which takes a predictable amount of time to run, and which can’t be forged by a bad actor. That’s not right. PoW takes a completely unpredictable amount of time. It’s not about a clock ticking, it’s about making the presence of two incompatible versions of history as expensive as possible, thus forcing the network into consensus.
- dozzie 9y ago
  There's more wrong statements in the quote, like blockchain solving consensus (it's not, it's a document timestamping).