5 ms·

The other consensus algorithms all follow the same consolidation logic of capitalism. Specifically, power consolidates year after year similar to banks, media c

by jerry1979 5y ago

The other consensus algorithms all follow the same consolidation logic of capitalism. Specifically, power consolidates year after year similar to banks, media companies, communication companies, etc. It looks to me like the PoS systems algorithmically codify this logic, and since the consolidation exists digitally, I would have a hard time coming up with a plan to break up the PoS oligopolies. The reason why the digital consolidation hurts people in the PoS system comes form the fact that consolidation of money in PoS directly relates to consolidation of actual voting power in those systems. PoW on the other hand will lead to consolidation around inexpensive energy: volcanoes in El Salvador, hydro in some northern countries, solar somewhere else, etc. However, those places will have some abstract voting power in the Bitcoin world, but exchanges, people, node operators, and businesses also have abstract voting power to balance against the cheap energy locations. I should mention that the upside of all of this is that we can now choose the option to have accessible digital banking around the world, and people who print money will have less of an impact on world affairs.

megameter 5y ago
I've gradually come around to the side of PoW being important as layer 1, because it's as close as we're likely to get to Lockean labor theory of property being directly manifest rather than built on a legal-deeds-and-titles national framework, and that has an immediate effect of building trust out of speculative value. PoW can be made more efficient along some axes, but not all of them. As such it puts every economy in a Red Queen's race to do things with available energy and computing power that are of more value than speculation. However, PoS has an important role as the layer for specific applications and markets, since it acts more like central banking with the tradeoffs of such.
- randomhodler84 5y ago
  You got it. PoW is critical for layer 1. Ongoing capital expenditure requirement is critical to prevent ancestral oligarchies. One cannot retain censorship resistance or decentralization with oligarchies.

megameter 5y ago

I've gradually come around to the side of PoW being important as layer 1, because it's as close as we're likely to get to Lockean labor theory of property being directly manifest rather than built on a legal-deeds-and-titles national framework, and that has an immediate effect of building trust out of speculative value. PoW can be made more efficient along some axes, but not all of them. As such it puts every economy in a Red Queen's race to do things with available energy and computing power that are of more value than speculation. However, PoS has an important role as the layer for specific applications and markets, since it acts more like central banking with the tradeoffs of such.

randomhodler84 5y ago
You got it. PoW is critical for layer 1. Ongoing capital expenditure requirement is critical to prevent ancestral oligarchies. One cannot retain censorship resistance or decentralization with oligarchies.