8 ms·

Proof-of-work should be banned

71 points by datafl4sh 6y ago

fastball 6y ago
> invariably brought to you by someone holding a proof-of-stake bag.
- asplake 6y ago
  Who are you quoting? Not the article as far as I can tell
- mjlawson 6y ago
  That's my take here as well. It's hard to take this seriously and I refuse to back this when it's posted anonymously, although I agree with the sentiment behind it.
  - raclage 6y ago
    Is this really the type of thing where an anonymous author can't have any credibility? It's an analysis of bitcoin and its energy use not a claim about personal experience.
- Deukhoofd 6y ago
  Weak ad hominem. Attack the argument, not imaginary attributes of the author.
- stopBurncoins 6y ago
  That'd be me. Yep, a total of < 1$, on an single, unknown and not even traded, but old coin (which I won't even mention) that is not going anywhere. Basically for fun.
- bfgoodrich 6y ago
  Why do you think BTC and ETH are still PoW? Because the major people making bank on proof of work refuse to allow a transition.
- JeremyBanks 6y ago
  "How dare they put their money where their mouth is?!" "How dare they invest in what they think is a less harmful alternative?!" "How dare they question our ponzi scheme!?"
- egypturnash 6y ago
  Heavens forbid that anyone who doesn't own cryptocurrency should have a studied opinion about it and its massive reliance on Proof-Of-Converting-Absurd-Amounts-Of-Power-Into-Waste-Heat. Heavens forbid that anyone who does own cryptocurrency and have concerns about said massive reliance on PoCAAoPIWH should put their money where their mouth is regarding those concerns. An absolute scandal.
  - fastball 6y ago
    Then put your name where your mouth is instead of hiding behind anonymity. Hardly a necessity in this case.
    - majewsky 6y ago
      Just because I don't want to participate in your Ponzi scheme doesn't mean I cannot point out how idiotic it is.
      - fastball 6y ago
        My ponzi scheme? Clearly this person does want to participate in the "ponzi scheme", they just want people to ignore the PoW schemes they're not holding a bag for and instead participate in the PoS schemes which they are.
X6S1x6Okd1st 6y ago
As long as we are making large unilateral changes: We should have a re-distributive carbon tax.
- elliotpage 6y ago
  Good idea. We should also abolish private landlords and immediately provide housing to everyone who is unhoused.
  - toxik 6y ago
    What I want to get at is: let us have world peace.
  - maxerickson 6y ago
    Yes, we should modify our social support systems in the direction of just providing housing. It won't solve all the problems, but for many people, it's a cheaper, more effective form of support than the things we do now.
- kristofferR 6y ago
  Yeah, this is a much better solution. You can't really ban proof-of-work practically anyway, but you can make quite easily make dirty electricity more expensive than clean electricity.
- brunoTbear 6y ago
  Yes, let perfect be the enemy of the good.
  - kristofferR 6y ago
    A carbon tax isn't some pie in the sky thing, most developed countries have implemented it.
    - X6S1x6Okd1st 6y ago
      For those wondering wikipedia has a list of places that have implemented some form of carbon tax: https://en.wikipedia.org/wiki/Carbon_tax#Implementation https://en.wikipedia.org/wiki/Carbon_tax#Implementation
harrigan 6y ago
"We ask that the use and possession of Proof-Of-Work cryptocurrencies be banned, with a one year max wait period to let the various projects transition to other technologies, like Proof-Of-Stake (so that nobody loses money, and this is already happening in Ethereum)". Ugh, I think that says it all.
quotemstr 6y ago
Nobody has any right to tell me what kind of math I can on processors I own powered by electricity that I bought.
- brunoTbear 6y ago
  This is tempting to think, but we already ban the math that provides, say, serving of child exploitation content.
  - deleted 6y ago
    [deleted]
  - mr_woozy 6y ago
    and it's not working https://www.bbc.com/news/education-53417284 https://www.bbc.com/news/education-53417284
- jariel 6y ago
  Yes, we do. We regulate all sorts of things, and this would be a smart thing to regulate. Electricity distribution and often production is partly to fully socialized almost everywhere, meaning 'it affects us all'. If you live on an island, disconnected from everyone else, then you can do whatever you want.
  - mr_woozy 6y ago
    >If you live on an island, disconnected from everyone else, then you can do whatever you want. I think you're unaware how isolated and segmented some of the global electrical grids are (even in well populated areas) that create the very off-peak idle production that allows mining to exist. This is certainly the case in parts of China (rainy season hydro) and the US that must maintain capacity for instant peak usage but otherwise goes to waste.
    - jariel 6y ago
      My statement has nothing to do with electricity isolation. It has to do with the fact that systems within a nation are integrated at an economic level, especially those that are socialized. You can dig holes and fill them in your back yard to your heart's content, but you can't do something that impacts watersheds. You can use electricity, but for certain uses it might be regulated, because in many instances the electricity production and distribution is socialized. We invest billion in electricity generation to support industry and infrastructure, not to support wasteful speculation. If someone wants to put up solar panels, or generate their electricity independently with no externalizations i.e. no pollution then go ahead. But otherwise, it's a giant waste. People are literally paying slightly higher electricity bills to support speculation, not good.
CyberRabbi 6y ago
The anti-Bitcoin mental gymnastics get more and more hilarious every cycle. You don’t have to feel this bad, just buy Bitcoin!
pydry 6y ago
It's unlikely that there will be any real attempt to regulate bitcoin while it enables the circumvention of capital controls and reliably brings wealth and investment into rich countries.
- jariel 6y ago
  As soon as public coffers are 'materially circumnavigated' it will be a problem.
  - pydry 6y ago
    If that were how it worked every tax haven in the world would be slammed with Cuba/Iran style sanctions.
- SideburnsOfDoom 6y ago
  because governments love "the circumvention of capital controls" ?
  - pydry 6y ago
    Do you think the United States objects to Chinese nationals buying up property in the US and sending their kids to school there?
    - SideburnsOfDoom 6y ago
      I think that this - of course - within the remit of The Chinese government. And should they object to it, being a large and powerful state, they have a large number of ways to curb it, starting with, but not limited to: Insisting on international treaties that act against the flows of dark money over borders in any direction (at which point, yes, other countries are obliged to object). Then moving on to acting directly and legally against Chinese citizens who do things that their state does not allow. Also, I am told that a lot of bitcoin "mining" occurs within the borders of China. other countries are already moving to do this kind of thing with cryptocurrency: https://www.reuters.com/article/uk-india-cryptocurrency-ban-idUSKBN2B60QP https://www.reuters.com/article/uk-india-cryptocurrency-ban-...
derefr 6y ago
This is like saying incandescent light bulbs should be banned. Sure, it’s a sensible thing to say once you have unilaterally-better bulbs already fully commercialized and in mass production. (And this happened with CFLs and then LED bulbs; and then we did ban incandescents, here in Canada and in many other places.) But we’re not at that “fully commercialized and in mass production” inflection point yet with Proof-of-Stake networks. They exist, but none have the transaction load (and thus the network build-out to absorb the transaction load) that Bitcoin has. Forcing a switch to PoS now, would be like trying to force a switch to CFLs or LED bulbs only a year or two after they were invented. What would you imagine would happen as a result? The incandescent manufacturers would go out of business, and the CFL/LED manufacturers wouldn’t yet have been able to absorb the demand. Nobody would be able to buy lightbulbs. This kind of a ban is effectively just demanding to kill the sector as a whole. Once an old technology is on its way out in the market anyway — and it’s only stubborn locked-in enterprise hold-outs, rather than greenfield adoption, continuing the relevance of the old tech — then it can be banned, to force those enterprise hold-outs to switch over to the new tech. That’s entirely appropriate. But the market knows when tech is mature, and the market itself switches over when that happens. Trying to force the market is just acting without the same distributed knowledge the market represents. It’s central top-down allocation trying to solve distributed problems, like the failure of the USSR. To be clear, I’m a developer for Proof-of-Stake ecosystem tooling myself. But I think all PoS developers would agree that there’s no Proof-of-Stake mainnet network that yet has the capacity to absorb all of Bitcoin’s transaction flow—and there’s no reason that one or more governments saying “you have a year to transition to PoS” would change this. The existing PoS chains are at the level of infrastructure development now, that the CFL+LED bulb industries were at around the year 1990. Do you think they could have suddenly achieved their 2014 (= the year Canada banned incandescents) level of infrastructure development in one year, if people just threw money at them? Technology—its productization, its operationalization, and ecosystem tooling adaptation—takes time.
- maxerickson 6y ago
  Other ledgers are better than bitcoin. Less energy use, faster, cheaper, better failure modes for users, etc.
- 6y ago
sb057 6y ago
While the energy consumption of proof-of-work is indeed an issue, for many trust-critical crypto projects (including effectively all cryptocurrencies) proof-of-stake has even bigger problems, as was demonstrated a decade ago when BTC was still under 10 USD: https://bitcointalk.org/index.php?topic=897488.msg10182752#msg10182752 https://bitcointalk.org/index.php?topic=897488.msg10182752#m... >I will formulate the attack: The "Second Pirate Savings and Trust" attack on Proof-of-Stake >1. The attacker creates the "Second Pirate Savings and Trust" modelled after the "First Pirate Savings and Trust" later called "Bitcoin Savings and Trust" https://bitcointalk.org/index.php?topic=50822.msg605957#msg605957 https://bitcointalk.org/index.php?topic=50822.msg605957#msg6.... This is done in a falling market. >2. The "trust" offers a very attractive rate of interest payable in the POS coin. This rate is significantly higher than the stake rate >3. The "trust" allows investors to leave the interest in the "trust" and roll over the investment. >4. The "trust specifically disclaims that it is a HYIP / Ponzi scam https://bitcointalk.org/index.php?topic=50822.msg605981#msg605981 https://bitcointalk.org/index.php?topic=50822.msg605981#msg6... >5. The attacker sells a portion of the borrowed POS coin say 50% for XBT, another POW alt-coin, one or more fiat currencies etc. This will becomes the attackers profit at the end. This will also depress the price by short selling creating the "bear raid" >6. A portion of the received POS coins is used to repay interest to those investors that do not reinvest their interest. This is the "ponzi" component; however see below. >7. The rest of the borrowed POS coin is kept by the attacker, accumulated and staked. >At this point this is no different from any bear raid on a stock, fiat currency POW currency etc. If the market exchange rate falls faster than 2x the interest rate less the stake rate then in the 50% example above, the attacker is actually in the black and there is no ponzi. In the normal bear raid the attacker, if the attacker can depress the price enough and cover the short, can actually walk away with a profit. The problem with the simple bear raid is that in covering the short the exchange rate can rise sharply. This converts the bear raid into a ponzi and the scheme collapses in a rising market. This is what happened to "First Pirate Savings and Trust". It collapsed during a rise in the Bitcoin price. >It is at this point where the specific to Proof-of-Stake part of the attack comes into play. >8. The attacker continues the ponzi until he has accumulated enough stake to launch a network attack. >9. The attacker is also accumulating a greater debt in the POS coin and can even continue selling 50% of the borrowed coin to increase his profit. >10. The attacker launches the attack on the coin causing its value to fall to zero. This wipes out the attacker's stake, but more importantly also wipes out the attacker's debt. The specifics of the attack will of course depend on the particular POS coin. >11. The attacker is left with is profit in some other currency, a worthless amount of the POS coin and a debt denominated in the now worthless POS currency. >Countermeasure: >The only known countermeasure is the intervention of the state. And to quote the same poster's thoughts as of a few months ago: https://www.reddit.com/r/Monero/comments/hpfjk8/could_monero_ever_move_to_proofofstake/ https://www.reddit.com/r/Monero/comments/hpfjk8/could_monero... >Proof of stake is ultimately based upon the premise that the holder of the staked coins has a financial incentive to act in the best interest of the crypto currency, in order to protect her stake. In other words she is net long the crypto currency. The trouble is that the network has no way of knowing if she is short or long, is acting as a dishonest custodian of somebody else's coins while staking them, has borrowed and sold a much larger number of coins creating net short position, has take a massive short position using leveraged derivatives, etc. In fact the network cannot even tell if she is a beneficial owner of the staked coins or just a nominee. >Based upon this I formulated The Second Pirate Savings and Trust attack on Proof-of-Stake over 5 years ago. https://bitcointalk.org/index.php?topic=897488.msg10182752#msg10182752 https://bitcointalk.org/index.php?topic=897488.msg10182752#m... Those who were around Bitcoin in 2011 - 2012 may remember the The First Pirate Savings and Trust, where a massive short position in Bitcoin was created, it then evolved into a ponzi scheme as the price of 1 BTC started to rise above 2 USD towards ~15 USD. At this point that whole thing blew up in default. Then the US SEC got to work fitting its promoter for an orange jumpsuit. Bitcoin survived because it is POW. If Bitcoin had been POS, then the promoter could have used the BTC under his control to wreck havoc on the Bitcoin network, causing the price to crash effectively making his debts worthless and very likely avoiding prosecution.
burlesona 6y ago
Actual question as I’m not too familiar with proof of stake. As described in the article, all that matters is how much is in your wallet... Doesn’t that seem ripe for hyper capitalist abuse? I realize the article is just offering a simplified explanation, but the idea that whoever has the most money directly controls the money supply itself seems... well, not ideal? So could anyone elaborate on what else about proof of stake leads to decentralization and fairness as opposed to just more incentives for centralization?
- nullc 6y ago
  Proof of Stake doesn't just have a problem with rich get richer effects, it's fundamentally logically unsound and is inherently insecure as a decenteralized consensus mechanism. Schemes which claim to have 'proven' the security of POS do so by assuming that you externally have a secure consensus mechanism (or one in disguise, e.g. a network which delivers all messages in the same order to all users), resulting in a completely tautological "proof". For more info on the unsoundness of POS: https://download.wpsoftware.net/bitcoin/pos.pdf https://download.wpsoftware.net/bitcoin/pos.pdf The reason you see it as part of the plans of some altcoins is that the creators of these coins wrote into their ledgers enormous numbers of coins for themselves, and are now stuck with largely illiquid billion dollar "investments" that they can't substantially sell without collapsing their markets and which aren't earning interest-- using POS gives them an excuse to guarantee themselves a return. The fact that it locks others out of the consensus or undermines the security is just collateral damage. As a bonus it also creates a new avenue to pump their systems vs alternatives which are actually trying to remain secure and decentralized. I expect to see HN and other venues flooded with more anonymously authored articles promoting this stuff in the coming years.
  - burlesona 6y ago
    This is helpful, thanks!
- shawnz 6y ago
  The pro-proof-of-stake argument is that every other system is inherently already like that: For example with proof-of-work, the richest can already afford the most hardware which gets them the most earnings. But actually with proof-of-work it's even worse, because it is a non-linear relationship as to what kind of mining hardware you can afford (richer can afford exponentially more efficient hardware). So proof-of-stake is actually better, because at least it's linear.
chrisjc 6y ago
Talking way outside of my understanding of POW, blockchain, etc, but what if POW was something with intrinsic value? Say for instance protein unfolding, physics number crunching, weather prediction, etc. And as a result this became the value of the ledger. Surely the amount of energy consumed by this valuable POW would make it potentially worth it when the returns would benefit society, the environment, etc...
- mr_woozy 6y ago
  https://en.bitcoin.it/wiki/Help:FAQ#Why_don.27t_we_use_calculations_that_are_also_useful_for_some_other_purpose.3F https://en.bitcoin.it/wiki/Help:FAQ#Why_don.27t_we_use_calcu...
wyldfire 6y ago
> Just ask that bitcoin and other switch to PoS! It will not be immediate, so the current investments in hardware can be repaid, and there will be no value lost. Miners almost certainly won't see it that way. "Oh so now you say that I can recoup my capital investment until 12/31/2024? Great, I will happily sign blocks that mark a transition to proof-of-stake." Miners would fork the coin at best. Or, rather, this new proof-of-stake coin would be considered the 'fork'. Serious design changes should be proposed via the process. For bitcoin, that's BIP [1]. This is just wishful thinking. Someone who proposes a 'ban' and not a design change is not genuinely motivated to supporting a decentralized currency. Why transition bitcoin at all? Just endorse PoS coins and if they're truly superior then they will take on more value and people will naturally transition. Metcalfe's law is difficult to overcome. However, the value should be apparent in an overall decrease of the network's CAPEX+OPEX. [1] https://github.com/bitcoin/bips/blob/master/README.mediawiki https://github.com/bitcoin/bips/blob/master/README.mediawiki
- stopBurncoins 6y ago
  And miners will not even accept switching to hasing like argon2, which would render GPU and ASIC useless, thus really distributing the mining a lot more. So we all agree that in one form or the other, the miners are parasitizing the projects, bringing inertia? Kinda strong words, I know, but If you can't even progress in the PoW world, you have a problem. How to solve it?
mnd999 6y ago
Cannabis (for example) has been banned since 1928, yet it hasn't gone away. When things make money, legislation is not an effective way to eliminate them.
- eli 6y ago
  Cannabis is inherently valuable. A proof-of-work blockchain is not; it's an implementation detail. A better example might be banning CFCs from aerosol spray cans.
alcio 6y ago
Proof-of-stake coins lack one of proof-of-work coins most important properties: censorship resistance. In both consensus systems, a censor is someone that has amassed 51% of the currently available stake (in PoW stake is mining machines, in PoS it is outstanding tokens). In proof-of-work systems, a censor can be unseated by censored parties allocating more capital to mining machines until non-censoring parties own 51% of all machines. In proof-of-stake systems, it is impossible to unseat a censor: since it owns 51% of tokens, it will also owns 51% of newly minted units in perpetuity (assuming it doesn't stop censoring and doesn't run into issues that would end up slashing some of their stake).
- aerojoe23 6y ago
  The math in this article makes it sound trivial for any major government to destroy bitcoin. https://joekelly100.medium.com/how-to-kill-bitcoin-part-2-no-can-spend-66e59385a4a5 https://joekelly100.medium.com/how-to-kill-bitcoin-part-2-no... It points out that "But we can spend more on hardware then they could." is false. Once it was outlawed, they can just seize the mining hardware. So PoS may actually be more resistant. Instead of acquiring physical hardware governments would have to start acquiring the currency. If they have to purchase it, it will drive the price up. While they maybe able to seize it in this scenario as well, it would seem the virtual crypto world would have better protection than the physical world.
wrnr 6y ago
We should ban articles like this from HN, I only want to see math, science and engineering not these opinion peaces about blockchain, ai ethics or visionary vc shit
- CyberRabbi 6y ago
  Well said
- datafl4sh 6y ago
  The article provides the links to the math you're looking for.
thesausageking 6y ago
I would a Bitcoin that this anonymous account holds a lot of proof stake tokens.
aarongray 6y ago
Why did this get flagged?
- aetherane 6y ago
  I'm guessing because a lot of people here work on cryptocurrency
OliverGilan 6y ago
I really don’t understand this attack on Bitcoin. It seems to be all the rage nowadays to lament the effects of Bitcoin’s electricity usage on the environment but a couple things seem true to me. 1) Any civilization sufficiently progressing will use more and more energy. Bitcoin could definitely be more energy efficient but even without it our society would still increase our energy usage over time. 2) The issue people have with electricity usage isn’t the actual usage of the electricity but how it’s generated. Why are we attacking Bitcoin for using electricity instead of simply pushing for more renewable energy sources? 3) For Bitcoin miners to maximize profit they need the cheapest elictricity and now that solar provides the cheapest energ per watt in history miners are actually incentivized to build out more solar. At the end of the day it seems to me that any free society that supplies energy as a service shouldn’t be dictating what individuals do with that electricity as long as they pay for it. If you’re concerned that electricity doesn’t properly price externalities then your issue is with the electricity provider, not Bitcoin miners.
- aetherane 6y ago
  But Bitcoin is not needed. It currently provides little to no positive value to society and a lot of negative value so it is hard to classify it as society progressing.
  - kreetx 6y ago
    The positive value is that it protects from inflation.
    - aetherane 6y ago
      Inflation is highly important to productive economies. Countries can default when there is no control over their money supply and inflation is needed to avoid stagnation.
      - smashem 6y ago
        All economies eventually fail due to inflation and central planning. I'm not saying we don't need national currencies, but bitcoin is the perfect hedge against central banking.
erosenbe0 6y ago
Decentralized 'currency' with wholly unregulated asset transfer incentivizes violence and needs to banned. I'd love for my mind to be changed, but if governments and other parties with grievances can't freeze or compel control over assets that leaves violence. Just the world we live in.
cryptonector 6y ago
IDK about PoS, but PoW should absolutely be banned. It's a tremendous waste of precious resources.
mr_woozy 6y ago
100% sure this anonymous article writer is somehow vested in a proof-of-stake shitcoin.
- sauwan 6y ago
  Or, just maybe, it's someone who truly cares about the ramifications of a cryptocurrency that requires the cumulative power of a medium size nation to run?
  - mr_woozy 6y ago
    Except that it's not true and been debunked continuously the past few months over and over. Most of this electricity is idle peak going to waste already and up to 60% has been via renewables that cannot be distributed globally like in my country of Iceland. Where we mine 11% of the Bitcoin network. But sure, align with whatever anonymous author you think best suits your narrative by all means.
mr_woozy 6y ago
>If we could push for legislation to ban PoW, then projects would take the time to switch to PoS, and everyone will go on like before. Still distributed. Still decentralized. How would this even work, if in the same article you mention China mines 65% of the Bitcoin network (I don't believe this is true btw). All you'll do is centralize the network to non-western democratic countries.
acco102 6y ago
"Nano is digital money for the modern world. Try out a fee-less, eco-friendly and instant currency that is easy to use, accept and integrate with." "EOS is a cryptocurrency designed to support large-scale applications. There are no fees to send or receive EOS. Instead, the protocol rewards the entities that run the network periodically with new EOS, effectively substituting inflation for transaction fees." but EOS has inflation.

71 points by datafl4sh 6y ago

fastball 6y ago

> invariably brought to you by someone holding a proof-of-stake bag.

asplake 6y ago
Who are you quoting? Not the article as far as I can tell
mjlawson 6y ago
That's my take here as well. It's hard to take this seriously and I refuse to back this when it's posted anonymously, although I agree with the sentiment behind it.
- raclage 6y ago
  Is this really the type of thing where an anonymous author can't have any credibility? It's an analysis of bitcoin and its energy use not a claim about personal experience.
Deukhoofd 6y ago
Weak ad hominem. Attack the argument, not imaginary attributes of the author.
stopBurncoins 6y ago
That'd be me. Yep, a total of < 1$, on an single, unknown and not even traded, but old coin (which I won't even mention) that is not going anywhere. Basically for fun.
bfgoodrich 6y ago
Why do you think BTC and ETH are still PoW? Because the major people making bank on proof of work refuse to allow a transition.
JeremyBanks 6y ago
"How dare they put their money where their mouth is?!" "How dare they invest in what they think is a less harmful alternative?!" "How dare they question our ponzi scheme!?"
egypturnash 6y ago
Heavens forbid that anyone who doesn't own cryptocurrency should have a studied opinion about it and its massive reliance on Proof-Of-Converting-Absurd-Amounts-Of-Power-Into-Waste-Heat. Heavens forbid that anyone who does own cryptocurrency and have concerns about said massive reliance on PoCAAoPIWH should put their money where their mouth is regarding those concerns. An absolute scandal.
- fastball 6y ago
  Then put your name where your mouth is instead of hiding behind anonymity. Hardly a necessity in this case.
  - majewsky 6y ago
    Just because I don't want to participate in your Ponzi scheme doesn't mean I cannot point out how idiotic it is.
    - fastball 6y ago
      My ponzi scheme? Clearly this person does want to participate in the "ponzi scheme", they just want people to ignore the PoW schemes they're not holding a bag for and instead participate in the PoS schemes which they are.

X6S1x6Okd1st 6y ago

As long as we are making large unilateral changes: We should have a re-distributive carbon tax.

elliotpage 6y ago
Good idea. We should also abolish private landlords and immediately provide housing to everyone who is unhoused.
- toxik 6y ago
  What I want to get at is: let us have world peace.
- maxerickson 6y ago
  Yes, we should modify our social support systems in the direction of just providing housing. It won't solve all the problems, but for many people, it's a cheaper, more effective form of support than the things we do now.
kristofferR 6y ago
Yeah, this is a much better solution. You can't really ban proof-of-work practically anyway, but you can make quite easily make dirty electricity more expensive than clean electricity.
brunoTbear 6y ago
Yes, let perfect be the enemy of the good.
- kristofferR 6y ago
  A carbon tax isn't some pie in the sky thing, most developed countries have implemented it.
  - X6S1x6Okd1st 6y ago
    For those wondering wikipedia has a list of places that have implemented some form of carbon tax: https://en.wikipedia.org/wiki/Carbon_tax#Implementation https://en.wikipedia.org/wiki/Carbon_tax#Implementation

harrigan 6y ago

"We ask that the use and possession of Proof-Of-Work cryptocurrencies be banned, with a one year max wait period to let the various projects transition to other technologies, like Proof-Of-Stake (so that nobody loses money, and this is already happening in Ethereum)". Ugh, I think that says it all.

quotemstr 6y ago

Nobody has any right to tell me what kind of math I can on processors I own powered by electricity that I bought.

brunoTbear 6y ago
This is tempting to think, but we already ban the math that provides, say, serving of child exploitation content.
- deleted 6y ago
  [deleted]
- mr_woozy 6y ago
  and it's not working https://www.bbc.com/news/education-53417284 https://www.bbc.com/news/education-53417284
jariel 6y ago
Yes, we do. We regulate all sorts of things, and this would be a smart thing to regulate. Electricity distribution and often production is partly to fully socialized almost everywhere, meaning 'it affects us all'. If you live on an island, disconnected from everyone else, then you can do whatever you want.
- mr_woozy 6y ago
  >If you live on an island, disconnected from everyone else, then you can do whatever you want. I think you're unaware how isolated and segmented some of the global electrical grids are (even in well populated areas) that create the very off-peak idle production that allows mining to exist. This is certainly the case in parts of China (rainy season hydro) and the US that must maintain capacity for instant peak usage but otherwise goes to waste.
  - jariel 6y ago
    My statement has nothing to do with electricity isolation. It has to do with the fact that systems within a nation are integrated at an economic level, especially those that are socialized. You can dig holes and fill them in your back yard to your heart's content, but you can't do something that impacts watersheds. You can use electricity, but for certain uses it might be regulated, because in many instances the electricity production and distribution is socialized. We invest billion in electricity generation to support industry and infrastructure, not to support wasteful speculation. If someone wants to put up solar panels, or generate their electricity independently with no externalizations i.e. no pollution then go ahead. But otherwise, it's a giant waste. People are literally paying slightly higher electricity bills to support speculation, not good.

CyberRabbi 6y ago

The anti-Bitcoin mental gymnastics get more and more hilarious every cycle. You don’t have to feel this bad, just buy Bitcoin!

pydry 6y ago

It's unlikely that there will be any real attempt to regulate bitcoin while it enables the circumvention of capital controls and reliably brings wealth and investment into rich countries.

jariel 6y ago
As soon as public coffers are 'materially circumnavigated' it will be a problem.
- pydry 6y ago
  If that were how it worked every tax haven in the world would be slammed with Cuba/Iran style sanctions.
SideburnsOfDoom 6y ago
because governments love "the circumvention of capital controls" ?
- pydry 6y ago
  Do you think the United States objects to Chinese nationals buying up property in the US and sending their kids to school there?
  - SideburnsOfDoom 6y ago
    I think that this - of course - within the remit of The Chinese government. And should they object to it, being a large and powerful state, they have a large number of ways to curb it, starting with, but not limited to: Insisting on international treaties that act against the flows of dark money over borders in any direction (at which point, yes, other countries are obliged to object). Then moving on to acting directly and legally against Chinese citizens who do things that their state does not allow. Also, I am told that a lot of bitcoin "mining" occurs within the borders of China. other countries are already moving to do this kind of thing with cryptocurrency: https://www.reuters.com/article/uk-india-cryptocurrency-ban-idUSKBN2B60QP https://www.reuters.com/article/uk-india-cryptocurrency-ban-...

derefr 6y ago

This is like saying incandescent light bulbs should be banned. Sure, it’s a sensible thing to say once you have unilaterally-better bulbs already fully commercialized and in mass production. (And this happened with CFLs and then LED bulbs; and then we did ban incandescents, here in Canada and in many other places.) But we’re not at that “fully commercialized and in mass production” inflection point yet with Proof-of-Stake networks. They exist, but none have the transaction load (and thus the network build-out to absorb the transaction load) that Bitcoin has. Forcing a switch to PoS now, would be like trying to force a switch to CFLs or LED bulbs only a year or two after they were invented. What would you imagine would happen as a result? The incandescent manufacturers would go out of business, and the CFL/LED manufacturers wouldn’t yet have been able to absorb the demand. Nobody would be able to buy lightbulbs. This kind of a ban is effectively just demanding to kill the sector as a whole. Once an old technology is on its way out in the market anyway — and it’s only stubborn locked-in enterprise hold-outs, rather than greenfield adoption, continuing the relevance of the old tech — then it can be banned, to force those enterprise hold-outs to switch over to the new tech. That’s entirely appropriate. But the market knows when tech is mature, and the market itself switches over when that happens. Trying to force the market is just acting without the same distributed knowledge the market represents. It’s central top-down allocation trying to solve distributed problems, like the failure of the USSR. To be clear, I’m a developer for Proof-of-Stake ecosystem tooling myself. But I think all PoS developers would agree that there’s no Proof-of-Stake mainnet network that yet has the capacity to absorb all of Bitcoin’s transaction flow—and there’s no reason that one or more governments saying “you have a year to transition to PoS” would change this. The existing PoS chains are at the level of infrastructure development now, that the CFL+LED bulb industries were at around the year 1990. Do you think they could have suddenly achieved their 2014 (= the year Canada banned incandescents) level of infrastructure development in one year, if people just threw money at them? Technology—its productization, its operationalization, and ecosystem tooling adaptation—takes time.

maxerickson 6y ago
Other ledgers are better than bitcoin. Less energy use, faster, cheaper, better failure modes for users, etc.
6y ago

sb057 6y ago

While the energy consumption of proof-of-work is indeed an issue, for many trust-critical crypto projects (including effectively all cryptocurrencies) proof-of-stake has even bigger problems, as was demonstrated a decade ago when BTC was still under 10 USD: https://bitcointalk.org/index.php?topic=897488.msg10182752#msg10182752 https://bitcointalk.org/index.php?topic=897488.msg10182752#m... >I will formulate the attack: The "Second Pirate Savings and Trust" attack on Proof-of-Stake >1. The attacker creates the "Second Pirate Savings and Trust" modelled after the "First Pirate Savings and Trust" later called "Bitcoin Savings and Trust" https://bitcointalk.org/index.php?topic=50822.msg605957#msg605957 https://bitcointalk.org/index.php?topic=50822.msg605957#msg6.... This is done in a falling market. >2. The "trust" offers a very attractive rate of interest payable in the POS coin. This rate is significantly higher than the stake rate >3. The "trust" allows investors to leave the interest in the "trust" and roll over the investment. >4. The "trust specifically disclaims that it is a HYIP / Ponzi scam https://bitcointalk.org/index.php?topic=50822.msg605981#msg605981 https://bitcointalk.org/index.php?topic=50822.msg605981#msg6... >5. The attacker sells a portion of the borrowed POS coin say 50% for XBT, another POW alt-coin, one or more fiat currencies etc. This will becomes the attackers profit at the end. This will also depress the price by short selling creating the "bear raid" >6. A portion of the received POS coins is used to repay interest to those investors that do not reinvest their interest. This is the "ponzi" component; however see below. >7. The rest of the borrowed POS coin is kept by the attacker, accumulated and staked. >At this point this is no different from any bear raid on a stock, fiat currency POW currency etc. If the market exchange rate falls faster than 2x the interest rate less the stake rate then in the 50% example above, the attacker is actually in the black and there is no ponzi. In the normal bear raid the attacker, if the attacker can depress the price enough and cover the short, can actually walk away with a profit. The problem with the simple bear raid is that in covering the short the exchange rate can rise sharply. This converts the bear raid into a ponzi and the scheme collapses in a rising market. This is what happened to "First Pirate Savings and Trust". It collapsed during a rise in the Bitcoin price. >It is at this point where the specific to Proof-of-Stake part of the attack comes into play. >8. The attacker continues the ponzi until he has accumulated enough stake to launch a network attack. >9. The attacker is also accumulating a greater debt in the POS coin and can even continue selling 50% of the borrowed coin to increase his profit. >10. The attacker launches the attack on the coin causing its value to fall to zero. This wipes out the attacker's stake, but more importantly also wipes out the attacker's debt. The specifics of the attack will of course depend on the particular POS coin. >11. The attacker is left with is profit in some other currency, a worthless amount of the POS coin and a debt denominated in the now worthless POS currency. >Countermeasure: >The only known countermeasure is the intervention of the state. And to quote the same poster's thoughts as of a few months ago: https://www.reddit.com/r/Monero/comments/hpfjk8/could_monero_ever_move_to_proofofstake/ https://www.reddit.com/r/Monero/comments/hpfjk8/could_monero... >Proof of stake is ultimately based upon the premise that the holder of the staked coins has a financial incentive to act in the best interest of the crypto currency, in order to protect her stake. In other words she is net long the crypto currency. The trouble is that the network has no way of knowing if she is short or long, is acting as a dishonest custodian of somebody else's coins while staking them, has borrowed and sold a much larger number of coins creating net short position, has take a massive short position using leveraged derivatives, etc. In fact the network cannot even tell if she is a beneficial owner of the staked coins or just a nominee. >Based upon this I formulated The Second Pirate Savings and Trust attack on Proof-of-Stake over 5 years ago. https://bitcointalk.org/index.php?topic=897488.msg10182752#msg10182752 https://bitcointalk.org/index.php?topic=897488.msg10182752#m... Those who were around Bitcoin in 2011 - 2012 may remember the The First Pirate Savings and Trust, where a massive short position in Bitcoin was created, it then evolved into a ponzi scheme as the price of 1 BTC started to rise above 2 USD towards ~15 USD. At this point that whole thing blew up in default. Then the US SEC got to work fitting its promoter for an orange jumpsuit. Bitcoin survived because it is POW. If Bitcoin had been POS, then the promoter could have used the BTC under his control to wreck havoc on the Bitcoin network, causing the price to crash effectively making his debts worthless and very likely avoiding prosecution.

burlesona 6y ago

Actual question as I’m not too familiar with proof of stake. As described in the article, all that matters is how much is in your wallet... Doesn’t that seem ripe for hyper capitalist abuse? I realize the article is just offering a simplified explanation, but the idea that whoever has the most money directly controls the money supply itself seems... well, not ideal? So could anyone elaborate on what else about proof of stake leads to decentralization and fairness as opposed to just more incentives for centralization?

nullc 6y ago
Proof of Stake doesn't just have a problem with rich get richer effects, it's fundamentally logically unsound and is inherently insecure as a decenteralized consensus mechanism. Schemes which claim to have 'proven' the security of POS do so by assuming that you externally have a secure consensus mechanism (or one in disguise, e.g. a network which delivers all messages in the same order to all users), resulting in a completely tautological "proof". For more info on the unsoundness of POS: https://download.wpsoftware.net/bitcoin/pos.pdf https://download.wpsoftware.net/bitcoin/pos.pdf The reason you see it as part of the plans of some altcoins is that the creators of these coins wrote into their ledgers enormous numbers of coins for themselves, and are now stuck with largely illiquid billion dollar "investments" that they can't substantially sell without collapsing their markets and which aren't earning interest-- using POS gives them an excuse to guarantee themselves a return. The fact that it locks others out of the consensus or undermines the security is just collateral damage. As a bonus it also creates a new avenue to pump their systems vs alternatives which are actually trying to remain secure and decentralized. I expect to see HN and other venues flooded with more anonymously authored articles promoting this stuff in the coming years.
- burlesona 6y ago
  This is helpful, thanks!
shawnz 6y ago
The pro-proof-of-stake argument is that every other system is inherently already like that: For example with proof-of-work, the richest can already afford the most hardware which gets them the most earnings. But actually with proof-of-work it's even worse, because it is a non-linear relationship as to what kind of mining hardware you can afford (richer can afford exponentially more efficient hardware). So proof-of-stake is actually better, because at least it's linear.

chrisjc 6y ago

Talking way outside of my understanding of POW, blockchain, etc, but what if POW was something with intrinsic value? Say for instance protein unfolding, physics number crunching, weather prediction, etc. And as a result this became the value of the ledger. Surely the amount of energy consumed by this valuable POW would make it potentially worth it when the returns would benefit society, the environment, etc...

mr_woozy 6y ago
https://en.bitcoin.it/wiki/Help:FAQ#Why_don.27t_we_use_calculations_that_are_also_useful_for_some_other_purpose.3F https://en.bitcoin.it/wiki/Help:FAQ#Why_don.27t_we_use_calcu...

wyldfire 6y ago

> Just ask that bitcoin and other switch to PoS! It will not be immediate, so the current investments in hardware can be repaid, and there will be no value lost. Miners almost certainly won't see it that way. "Oh so now you say that I can recoup my capital investment until 12/31/2024? Great, I will happily sign blocks that mark a transition to proof-of-stake." Miners would fork the coin at best. Or, rather, this new proof-of-stake coin would be considered the 'fork'. Serious design changes should be proposed via the process. For bitcoin, that's BIP [1]. This is just wishful thinking. Someone who proposes a 'ban' and not a design change is not genuinely motivated to supporting a decentralized currency. Why transition bitcoin at all? Just endorse PoS coins and if they're truly superior then they will take on more value and people will naturally transition. Metcalfe's law is difficult to overcome. However, the value should be apparent in an overall decrease of the network's CAPEX+OPEX. [1] https://github.com/bitcoin/bips/blob/master/README.mediawiki https://github.com/bitcoin/bips/blob/master/README.mediawiki

stopBurncoins 6y ago
And miners will not even accept switching to hasing like argon2, which would render GPU and ASIC useless, thus really distributing the mining a lot more. So we all agree that in one form or the other, the miners are parasitizing the projects, bringing inertia? Kinda strong words, I know, but If you can't even progress in the PoW world, you have a problem. How to solve it?

mnd999 6y ago

Cannabis (for example) has been banned since 1928, yet it hasn't gone away. When things make money, legislation is not an effective way to eliminate them.

eli 6y ago
Cannabis is inherently valuable. A proof-of-work blockchain is not; it's an implementation detail. A better example might be banning CFCs from aerosol spray cans.

alcio 6y ago

Proof-of-stake coins lack one of proof-of-work coins most important properties: censorship resistance. In both consensus systems, a censor is someone that has amassed 51% of the currently available stake (in PoW stake is mining machines, in PoS it is outstanding tokens). In proof-of-work systems, a censor can be unseated by censored parties allocating more capital to mining machines until non-censoring parties own 51% of all machines. In proof-of-stake systems, it is impossible to unseat a censor: since it owns 51% of tokens, it will also owns 51% of newly minted units in perpetuity (assuming it doesn't stop censoring and doesn't run into issues that would end up slashing some of their stake).

aerojoe23 6y ago
The math in this article makes it sound trivial for any major government to destroy bitcoin. https://joekelly100.medium.com/how-to-kill-bitcoin-part-2-no-can-spend-66e59385a4a5 https://joekelly100.medium.com/how-to-kill-bitcoin-part-2-no... It points out that "But we can spend more on hardware then they could." is false. Once it was outlawed, they can just seize the mining hardware. So PoS may actually be more resistant. Instead of acquiring physical hardware governments would have to start acquiring the currency. If they have to purchase it, it will drive the price up. While they maybe able to seize it in this scenario as well, it would seem the virtual crypto world would have better protection than the physical world.

wrnr 6y ago

We should ban articles like this from HN, I only want to see math, science and engineering not these opinion peaces about blockchain, ai ethics or visionary vc shit

CyberRabbi 6y ago
Well said
datafl4sh 6y ago
The article provides the links to the math you're looking for.

thesausageking 6y ago

I would a Bitcoin that this anonymous account holds a lot of proof stake tokens.

aarongray 6y ago

Why did this get flagged?

aetherane 6y ago
I'm guessing because a lot of people here work on cryptocurrency

OliverGilan 6y ago

I really don’t understand this attack on Bitcoin. It seems to be all the rage nowadays to lament the effects of Bitcoin’s electricity usage on the environment but a couple things seem true to me. 1) Any civilization sufficiently progressing will use more and more energy. Bitcoin could definitely be more energy efficient but even without it our society would still increase our energy usage over time. 2) The issue people have with electricity usage isn’t the actual usage of the electricity but how it’s generated. Why are we attacking Bitcoin for using electricity instead of simply pushing for more renewable energy sources? 3) For Bitcoin miners to maximize profit they need the cheapest elictricity and now that solar provides the cheapest energ per watt in history miners are actually incentivized to build out more solar. At the end of the day it seems to me that any free society that supplies energy as a service shouldn’t be dictating what individuals do with that electricity as long as they pay for it. If you’re concerned that electricity doesn’t properly price externalities then your issue is with the electricity provider, not Bitcoin miners.

aetherane 6y ago
But Bitcoin is not needed. It currently provides little to no positive value to society and a lot of negative value so it is hard to classify it as society progressing.
- kreetx 6y ago
  The positive value is that it protects from inflation.
  - aetherane 6y ago
    Inflation is highly important to productive economies. Countries can default when there is no control over their money supply and inflation is needed to avoid stagnation.
    - smashem 6y ago
      All economies eventually fail due to inflation and central planning. I'm not saying we don't need national currencies, but bitcoin is the perfect hedge against central banking.

erosenbe0 6y ago

Decentralized 'currency' with wholly unregulated asset transfer incentivizes violence and needs to banned. I'd love for my mind to be changed, but if governments and other parties with grievances can't freeze or compel control over assets that leaves violence. Just the world we live in.

cryptonector 6y ago

IDK about PoS, but PoW should absolutely be banned. It's a tremendous waste of precious resources.

mr_woozy 6y ago

100% sure this anonymous article writer is somehow vested in a proof-of-stake shitcoin.

sauwan 6y ago
Or, just maybe, it's someone who truly cares about the ramifications of a cryptocurrency that requires the cumulative power of a medium size nation to run?
- mr_woozy 6y ago
  Except that it's not true and been debunked continuously the past few months over and over. Most of this electricity is idle peak going to waste already and up to 60% has been via renewables that cannot be distributed globally like in my country of Iceland. Where we mine 11% of the Bitcoin network. But sure, align with whatever anonymous author you think best suits your narrative by all means.

mr_woozy 6y ago

>If we could push for legislation to ban PoW, then projects would take the time to switch to PoS, and everyone will go on like before. Still distributed. Still decentralized. How would this even work, if in the same article you mention China mines 65% of the Bitcoin network (I don't believe this is true btw). All you'll do is centralize the network to non-western democratic countries.

acco102 6y ago

"Nano is digital money for the modern world. Try out a fee-less, eco-friendly and instant currency that is easy to use, accept and integrate with." "EOS is a cryptocurrency designed to support large-scale applications. There are no fees to send or receive EOS. Instead, the protocol rewards the entities that run the network periodically with new EOS, effectively substituting inflation for transaction fees." but EOS has inflation.