4 ms·

In a Proof of Stake system, money directly, literally translates to power over the network. There is virtually zero risk to mining, and there is zero overhead c

In a Proof of Stake system, money directly, literally translates to power over the network. There is virtually zero risk to mining, and there is zero overhead cost. As such, the centralization of Proof of Stake is inevtiable: coin staked begets coin, which begets more coin. This is principally no different to Proof of Work in practical terms. More resources gets you more power, and this is inescapable in any structure. More money begets more mining hardware, which begets more coin, which begets more mining hardware. With PoW there is the element of specialized chipset advantages through R&D. I.e. I will always be disadvantaged because the SHA-256 ASICs available to me will always be subpar to whatever the big players have. With PoS 1 of my coins carries same vote power as 1 of your coins. You may have the ability to stake more coins, which will reward you more, but our returns (ROI) will always be proportionally equal.

Kranar 5y ago
The argument has nothing to do with more resources resulting in more power, of course that is the case. The question is how does one acquire those resources and maintain them. In proof of work, resources need to be derived and maintained external to the system... who can produce the fastest processors, who can produce the cheapest electricity, who can maintain the more efficient data centers, etc etc... This comes with big risk and require constant upkeep. In proof of stake, the person with the most resources is the person with the most coin and maintaining that not only costs nothing... maintaining it produces more of the very resource.
- coralreef 5y ago
  Are we optimizing for a fair playing field? Or a playing field where one can be advantaged? If my authoritarian government bans mining, my energy usage is easy to track down, and I am disadvantaged. If my nation state has an abundance of cheap hydro energy, I am advantaged (and miners flock here to take advantage, centralizing mining into this geographic area).

Kranar 5y ago

The argument has nothing to do with more resources resulting in more power, of course that is the case. The question is how does one acquire those resources and maintain them. In proof of work, resources need to be derived and maintained external to the system... who can produce the fastest processors, who can produce the cheapest electricity, who can maintain the more efficient data centers, etc etc... This comes with big risk and require constant upkeep. In proof of stake, the person with the most resources is the person with the most coin and maintaining that not only costs nothing... maintaining it produces more of the very resource.

coralreef 5y ago
Are we optimizing for a fair playing field? Or a playing field where one can be advantaged? If my authoritarian government bans mining, my energy usage is easy to track down, and I am disadvantaged. If my nation state has an abundance of cheap hydro energy, I am advantaged (and miners flock here to take advantage, centralizing mining into this geographic area).