5 ms·

> The first class lost the students that simply couldn't keep up with the increasingly difficult sudokus. This is the story of every proof-of-work cryptocurren

by ronsor 6y ago

> The first class lost the students that simply couldn't keep up with the increasingly difficult sudokus. This is the story of every proof-of-work cryptocurrency. After a certain point, they only serve to make the rich even richer. Look at Bitcoin for example, where over 50% of the hashing power is controlled by big Chinese mining operations.

DylanBohlender 6y ago
I would contest that assertion - some blockchains regularly change their PoW algorithm in an attempt to stay "ASIC-resistant."
- freeone3000 6y ago
  That simply makes two currencies - before-fork, and after-fork. There's no rule that the one that "should" win does, especially in the face of large computing power making the former more attractive. See Bitcoin Cash, versus Bitcoin Classic.
  - ChainOfFools 6y ago
    OP may be referring to algorithms that rotate between a fixed set of widely dissimilar POW puzzles, in an attempt to make it discouragingly expensive to design and fabricate a rather complex ASIC requiring a lot of die space. IIRC it didn't work for long (the of promoters of these tokens were likely well aware of this), and ASICs for them appeared anyway, once an ROI probability threshold was reached.
  - Erlich_Bachman 6y ago
    That's just not an accurate nor truthful account of what happens in practice. The example you gave has nothing to do with changing the PoW function to counteract ASICs. Both Bcash and bitcoin classic were forked because of completely different reasons, and had people who believed in those reasons defend the new forks and run the node software etc. For example XMR has been doing ASIC-deterrent forks for years now with great success.
    - atweiden 6y ago
      In 2018, 50-60% of Monero hashrate was rumored to be from secret ASICs. How “successful” at warding off ASICs could hard forking a coin’s hashing algorithm really be if it doesn’t stop the ASIC manufacturers from building ASICs for any given algorithm? Also it seems clear that Monero’s purported “ASIC resistance” is very much a social contract — requiring constant vigilance to uphold — one which isn’t guaranteed to be strictly adhered to over the long run, particularly as the cost/benefit analysis gets murkier.
      - Erlich_Bachman 6y ago
        > a social contract Just like the rest of the cryptos that require all the participants to use specific protocol and software and agree on specific rules.
- ronsor 6y ago
  Ok. Perhaps not every proof-of-work currency, but a vast amount of them still suffer from the issue I mentioned.
- TeMPOraL 6y ago
  That only makes it slightly more expensive for the rich people who, instead of fabbing ASICs, have to just buy more GPUs.
xur17 6y ago
But at the end of the day, PoW is simply a fee that users of the network pay (in the form of inflation) to secure the network. I'm not convinced it's really a distribution mechanism.
- ronsor 6y ago
  Is the network so secure if relatively few groups hold most of the power? The danger of 51% attacks[0] is well known. [0] https://dci.mit.edu/51-attacks https://dci.mit.edu/51-attacks
  - kleer001 6y ago
    Any discussion of 51% attacks that ignores the game theory of it I think misses the original genius of the Bitcoin white paper. If one has control of 51% of the network it's in one's best interest to keep that network going successfully. Sure, there's suicidal malcontents and those that just want chaos. But barring some brain cancer it's very difficult for individuals to throw away billions of dollars. Because if a 51% attack works it's not going to work for long, the corrupted blocks are going to be immediately known, and everyone else will just fork off and leave that 51% attacker holding the bag.
    - pazimzadeh 6y ago
      You could say the same thing about infectious disease. The most successful diseases don't kill you, they just sap your energy a little bit at a time. What is the equivalent of parasites in blockchain-land?
      - atweiden 6y ago
        > What is the equivalent of parasites in blockchain-land? It’s the people insinuating impropriety of Proof-of-Work mining in the hopes of less than transparently promoting a competing premined/ICO’d Proof-of-Stake cryptocurrency sans any form of disclosure statement. You know, the sort of thing that’s been plaguing the cryptocurrency space for a good, solid decade now?
stevev 6y ago
Looks like someone missed the buying opportunity lol.
- endisneigh 6y ago
  These types of comments are honestly unhelpful. Unfortunately the said can be about my comment, but I do not have the ability to downvote, alas. If they held bitcoin would their opinion matter more or less? Why should it matter?
- ImprobableTruth 6y ago
  Is this the level the discussion has reached, Facebook-level 'Dear haters, you are just jealous!' posts? I guess in a way comments like these are actually a really good indication that PoS is superior in virtually every way.
- dang 6y ago
  Can you please not post unsubstantive and/or flamebait comments to HN, regardless of how you feel about Bitcoin or whatever? It sends discussions straight to failure mode. https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html
spurdoman77 6y ago
Proof of stake literally makes rich richer, thats the point of it - holders can mint new blocks. With proof of work there is actual work involved tol, not just minting money with your capital.
- spijdar 6y ago
  In either case you can use your accumulating capital to accumulate more capital -- PoW just means consuming actual resources to do so, as you fold your earnings into more hardware and electricity to earn more.
  - DennisP 6y ago
    And PoW has significant economies of scale. The big Chinese miners have special deals with power companies and ASIC manufacturers. PoS at least gives everyone an even playing field; big or small you get the same percentage return. (Of course that's pretty much the point of the analogy.)
    - atweiden 6y ago
      > PoS at least gives everyone an even playing field; big or small you get the same percentage return. Your cost basis in the underlying coin is by far the largest determinant of ROI. It’s like the old real estate adage: “money is made on the purchase, not on the sale”. Fairness of mining has always been virtually irrelevant to ROI. (Except insofar as accusing competitors of shades of mining “impropriety” supports a narrative — and invariably a narrative which disproportionately benefits investors with an ultra low cost basis in a benefactor to said narrative.) “China miners, special deals” etc — it’s a trope that’s been going around for about a decade. Virtue signaling aside, judging by the raging bull market for ICO coins amongst cryptocurrency investors, clearly no one is concerned with fairness whatsoever. These things are majority premined by insiders and/or sold to prestigious investors in pre-pre-pre ICOs (yes, there are “levels”). What happens is the general public gets sucked into these coins then adopts narratives which suit them. That’s what you’re seeing here. Not that anyone cares. (Disclosure: I’m invested in a true hybrid PoW/PoS coin, and I’m rather familiar with the downsides of both PoW and PoS mining.)

by ronsor 6y ago

DylanBohlender 6y ago

I would contest that assertion - some blockchains regularly change their PoW algorithm in an attempt to stay "ASIC-resistant."

freeone3000 6y ago
That simply makes two currencies - before-fork, and after-fork. There's no rule that the one that "should" win does, especially in the face of large computing power making the former more attractive. See Bitcoin Cash, versus Bitcoin Classic.
- ChainOfFools 6y ago
  OP may be referring to algorithms that rotate between a fixed set of widely dissimilar POW puzzles, in an attempt to make it discouragingly expensive to design and fabricate a rather complex ASIC requiring a lot of die space. IIRC it didn't work for long (the of promoters of these tokens were likely well aware of this), and ASICs for them appeared anyway, once an ROI probability threshold was reached.
- Erlich_Bachman 6y ago
  That's just not an accurate nor truthful account of what happens in practice. The example you gave has nothing to do with changing the PoW function to counteract ASICs. Both Bcash and bitcoin classic were forked because of completely different reasons, and had people who believed in those reasons defend the new forks and run the node software etc. For example XMR has been doing ASIC-deterrent forks for years now with great success.
  - atweiden 6y ago
    In 2018, 50-60% of Monero hashrate was rumored to be from secret ASICs. How “successful” at warding off ASICs could hard forking a coin’s hashing algorithm really be if it doesn’t stop the ASIC manufacturers from building ASICs for any given algorithm? Also it seems clear that Monero’s purported “ASIC resistance” is very much a social contract — requiring constant vigilance to uphold — one which isn’t guaranteed to be strictly adhered to over the long run, particularly as the cost/benefit analysis gets murkier.
    - Erlich_Bachman 6y ago
      > a social contract Just like the rest of the cryptos that require all the participants to use specific protocol and software and agree on specific rules.
ronsor 6y ago
Ok. Perhaps not every proof-of-work currency, but a vast amount of them still suffer from the issue I mentioned.
TeMPOraL 6y ago
That only makes it slightly more expensive for the rich people who, instead of fabbing ASICs, have to just buy more GPUs.

xur17 6y ago

But at the end of the day, PoW is simply a fee that users of the network pay (in the form of inflation) to secure the network. I'm not convinced it's really a distribution mechanism.

ronsor 6y ago
Is the network so secure if relatively few groups hold most of the power? The danger of 51% attacks[0] is well known. [0] https://dci.mit.edu/51-attacks https://dci.mit.edu/51-attacks
- kleer001 6y ago
  Any discussion of 51% attacks that ignores the game theory of it I think misses the original genius of the Bitcoin white paper. If one has control of 51% of the network it's in one's best interest to keep that network going successfully. Sure, there's suicidal malcontents and those that just want chaos. But barring some brain cancer it's very difficult for individuals to throw away billions of dollars. Because if a 51% attack works it's not going to work for long, the corrupted blocks are going to be immediately known, and everyone else will just fork off and leave that 51% attacker holding the bag.
  - pazimzadeh 6y ago
    You could say the same thing about infectious disease. The most successful diseases don't kill you, they just sap your energy a little bit at a time. What is the equivalent of parasites in blockchain-land?
    - atweiden 6y ago
      > What is the equivalent of parasites in blockchain-land? It’s the people insinuating impropriety of Proof-of-Work mining in the hopes of less than transparently promoting a competing premined/ICO’d Proof-of-Stake cryptocurrency sans any form of disclosure statement. You know, the sort of thing that’s been plaguing the cryptocurrency space for a good, solid decade now?

stevev 6y ago

Looks like someone missed the buying opportunity lol.

endisneigh 6y ago
These types of comments are honestly unhelpful. Unfortunately the said can be about my comment, but I do not have the ability to downvote, alas. If they held bitcoin would their opinion matter more or less? Why should it matter?
ImprobableTruth 6y ago
Is this the level the discussion has reached, Facebook-level 'Dear haters, you are just jealous!' posts? I guess in a way comments like these are actually a really good indication that PoS is superior in virtually every way.
dang 6y ago
Can you please not post unsubstantive and/or flamebait comments to HN, regardless of how you feel about Bitcoin or whatever? It sends discussions straight to failure mode. https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html

spurdoman77 6y ago

Proof of stake literally makes rich richer, thats the point of it - holders can mint new blocks. With proof of work there is actual work involved tol, not just minting money with your capital.

spijdar 6y ago
In either case you can use your accumulating capital to accumulate more capital -- PoW just means consuming actual resources to do so, as you fold your earnings into more hardware and electricity to earn more.
- DennisP 6y ago
  And PoW has significant economies of scale. The big Chinese miners have special deals with power companies and ASIC manufacturers. PoS at least gives everyone an even playing field; big or small you get the same percentage return. (Of course that's pretty much the point of the analogy.)
  - atweiden 6y ago
    > PoS at least gives everyone an even playing field; big or small you get the same percentage return. Your cost basis in the underlying coin is by far the largest determinant of ROI. It’s like the old real estate adage: “money is made on the purchase, not on the sale”. Fairness of mining has always been virtually irrelevant to ROI. (Except insofar as accusing competitors of shades of mining “impropriety” supports a narrative — and invariably a narrative which disproportionately benefits investors with an ultra low cost basis in a benefactor to said narrative.) “China miners, special deals” etc — it’s a trope that’s been going around for about a decade. Virtue signaling aside, judging by the raging bull market for ICO coins amongst cryptocurrency investors, clearly no one is concerned with fairness whatsoever. These things are majority premined by insiders and/or sold to prestigious investors in pre-pre-pre ICOs (yes, there are “levels”). What happens is the general public gets sucked into these coins then adopts narratives which suit them. That’s what you’re seeing here. Not that anyone cares. (Disclosure: I’m invested in a true hybrid PoW/PoS coin, and I’m rather familiar with the downsides of both PoW and PoS mining.)