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That's true, but PoW currencies have the same opportunity cost -- if you buy Bitcoin you can't invest the same funds else. Let's say you were forced to invest
by dlubarov 9y ago
That's true, but PoW currencies have the same opportunity cost -- if you buy Bitcoin you can't invest the same funds else.
Let's say you were forced to invest all your savings in either a PoW or a PoS currency; no other investments are possible. Say they both have the same block reward, which is essentially inflation tax.
Since you'll have to pay inflation tax either way, wouldn't you rather invest in the PoS currency, where the tax is redistributed to stakeholders including yourself? Rather than the PoW currency where the tax goes toward hardware and electricity bills.
- freech 9y agoThere's a third possibility in your example though: Invest in mining the PoW currency.
- lalaland1125 9y ago> That's true, but PoW currencies have the same opportunity cost -- if you buy Bitcoin you can't invest the same funds else. That's simply not true. You could potentially loan out your Bitcoin to a company which would play to use that money to create a profitable business. (Of course, it's a bit trickier to do that with Bitcoin due to the deflationary nature, but that's another story.) When you stake your coins, that's not quite possible.
- dlubarov 9y agoTrue but at the end of the day, someone is going to be holding the coins, and that entity is better off holding PoS coins that PoW coins. We can tweak the scenario to say that you're forced to buy and simply hold one of the currencies, without loaning them out or otherwise touching them for 5 years. Then clearly PoS has the advantage.