5 ms·

PoW already brought us to huge wealth concentration so it is not the solution either. This is one of the hard-not-so-talked problems of cryptos at the moment, a

by yulaow 5y ago

PoW already brought us to huge wealth concentration so it is not the solution either. This is one of the hard-not-so-talked problems of cryptos at the moment, and I can't see how to solve it.

tromp 5y ago
PoW tries to minimizes wealth concentration by imposing a competitive cost on obtaining coins. Of course it cannot reduce the wealth concentration already present in fiat. It can at best not make it much worse (as PoS does). PoW still suffers from wealth concentration due to varying block subsidies over time, which is why I'm a strong supporter of uncapped emissions like 1 coin per second forever, which gives no advantage to early miners.
- lottin 5y ago
  How does PoW minimise wealth concentration? Minimising wealth concentration would imply distributing the coins evenly among the network participants. That's not what PoW does.
- garren 5y ago
  Doesn’t “minimiz[ing] wealth concentration by imposing a competitive cost on obtaining coins”, basically translate to “only the wealthy can afford the compute resources needed to mine”? So, not really minimizing wealth concentration as practically gauranteeing that only those with a tremendous amount of resources to waste on PoW will see any return? In fact, the first link in the post [0] touches on this point very well in the first 30 min or so. [0] https://www.youtube.com/watch?v=YQ_xWvX1n9g https://www.youtube.com/watch?v=YQ_xWvX1n9g
tenuousemphasis 5y ago
The problem is capitalism, but at least with Bitcoin there is no central authority to unilaterally alter monetary policy to benefit one specific group (those closest to supply of new money i.e. Gresham's Law).
- newacc9 5y ago
  cantillion effect rather
  - tenuousemphasis 5y ago
    Yes, that was a dumb mistake on my part
- yifanl 5y ago
  Isn't there? If there are incentives in place that grant some group of people disproportionate power over others (early miners having essentially irrational amounts of coin to work with, or large pool operators owning a substantial amount of the hash rate), then it will trend towards centralization, because they end up being the main stakeholders. Bitcoin has _mostly_ avoided it, but not fully, as evidenced by the coins claiming to be the One True Bitcoin, forks driven largely by a small group of people who want to force some policy onto the blockchain, and not entirely unsuccessfully.
  - tenuousemphasis 5y ago
    >Isn't there? There isn't. Early miners have long since sold off their coins. Pool operators don't own any hashrate. Yes there is some fuckery they can engage in, but it would be obvious and miners can trivially switch pools. Forks are evidence that there is no central authority in Bitcoin! They cannot change the rules for others so they go do their own thing. How can you not see this as an incredible feature?

by yulaow 5y ago

PoW already brought us to huge wealth concentration so it is not the solution either. This is one of the hard-not-so-talked problems of cryptos at the moment, and I can't see how to solve it.

tromp 5y ago

PoW tries to minimizes wealth concentration by imposing a competitive cost on obtaining coins. Of course it cannot reduce the wealth concentration already present in fiat. It can at best not make it much worse (as PoS does). PoW still suffers from wealth concentration due to varying block subsidies over time, which is why I'm a strong supporter of uncapped emissions like 1 coin per second forever, which gives no advantage to early miners.

lottin 5y ago
How does PoW minimise wealth concentration? Minimising wealth concentration would imply distributing the coins evenly among the network participants. That's not what PoW does.
garren 5y ago
Doesn’t “minimiz[ing] wealth concentration by imposing a competitive cost on obtaining coins”, basically translate to “only the wealthy can afford the compute resources needed to mine”? So, not really minimizing wealth concentration as practically gauranteeing that only those with a tremendous amount of resources to waste on PoW will see any return? In fact, the first link in the post [0] touches on this point very well in the first 30 min or so. [0] https://www.youtube.com/watch?v=YQ_xWvX1n9g https://www.youtube.com/watch?v=YQ_xWvX1n9g

tenuousemphasis 5y ago

The problem is capitalism, but at least with Bitcoin there is no central authority to unilaterally alter monetary policy to benefit one specific group (those closest to supply of new money i.e. Gresham's Law).

newacc9 5y ago
cantillion effect rather
- tenuousemphasis 5y ago
  Yes, that was a dumb mistake on my part
yifanl 5y ago
Isn't there? If there are incentives in place that grant some group of people disproportionate power over others (early miners having essentially irrational amounts of coin to work with, or large pool operators owning a substantial amount of the hash rate), then it will trend towards centralization, because they end up being the main stakeholders. Bitcoin has _mostly_ avoided it, but not fully, as evidenced by the coins claiming to be the One True Bitcoin, forks driven largely by a small group of people who want to force some policy onto the blockchain, and not entirely unsuccessfully.
- tenuousemphasis 5y ago
  >Isn't there? There isn't. Early miners have long since sold off their coins. Pool operators don't own any hashrate. Yes there is some fuckery they can engage in, but it would be obvious and miners can trivially switch pools. Forks are evidence that there is no central authority in Bitcoin! They cannot change the rules for others so they go do their own thing. How can you not see this as an incredible feature?