13 ms·

Proof-of-Stake is better than Proof-of-Work; the Merge won’t fix other problems

30 points by davidgerard 4y ago

bhdlr 4y ago
This guy has a weak understanding of how Bitcoin's proof of work functions and fails to acknowledge the fact that PoS is just putting the Eth supply in the hands of the rich
- hunter-gatherer 4y ago
  His article mostly says what you just said... He didn't elaborate a lot on PoW, but he didn't say anything wildly offcourse.
  - bhdlr 4y ago
    > His article mostly says what you just said... He didn't elaborate a lot on PoW, but he didn't say anything wildly offcourse. He said that Bitcoin is centralized because there may be 51% of miners controlled by one entity. However that has been proven to be false (see The Blocksize War). Bitcoin is controlled by the nodes, not by who has the most mining power
    - jqpabc123 4y ago
      Bitcoin is controlled by the nodes, not by who has the most mining power Bitcoin is controlled by the exchanges. Whoever has the majority of the trading volume has most of the power and influence over it's price. Currently, this would be Binance. Please don't bother explaining how P2P is beyond their influence (it's not). Their influence is magnified by Tether which they can mint at will and is involved in over half of all crypto trades. Long story short --- the crypto market has been rigged --- by Binance. Collusion with others is likely simply due to the fact there is nothing to prevent it --- but it's impossible to say anything for sure because there is no external access. Blockchain is just an accounting system which tracks how badly the market is rigged.
    - SamPatt 4y ago
      Bitcoin is not controlled by the nodes. It is controlled by the miners, and a 51% attack is a serious concern. It always has been, and it always will be. It was designed assuming at least half of the network would not be malicious. The blocksize war absolutely didn't prove the superiority of the nodes. These are tall tales told by people who really wanted that to be true.
      - davidgerard 4y ago
        The decision was made by the exchanges. Bitcoin Cash wanted the BTC ticker, and didn't get it. That's why in the ETH merge, the issue is who the money goes with. Circle and Coinbase are going with the merge, so it wins.
- eterps 4y ago
  > fails to acknowledge the fact that PoS is just putting the Eth supply in the hands of the rich https://mobile.twitter.com/ercwl/status/1555719147941683200 https://mobile.twitter.com/ercwl/status/1555719147941683200
  - blueprint 4y ago
    The issue is not the fact that proof of work is more centralized, the issue is the fact that proof of stake is truly breakable by taking out a small loan
    - landemva 4y ago
      You have a few more weeks to plan your attack. Let's see it. Regardless of small or big loan, it will be slashed. On PoW chain you would still have the mining hardware to run the attack again.
      - blueprint 4y ago
        what do you mean by slashed? having hardware is not the thing that allows you to attack a PoW network. especially if it's one of the ones that anyone actually puts any stock in the network security of. bitcoin's network security is a joke (although certainly better than PoS), so hopefully we're on the same page about that as well?
- Chai-T-Rex 4y ago
  I'm a bit lost on how the bitcoin supply isn't in the hands of the rich. Do they give out free mining equipment and electricity to the poor to equalize things?
quickthrower2 4y ago
the infura bit is interesting. Might be the leftpad of crypto? Every web3 tutorial will blindly say to use it. Makes it easy of course! And then it is entrenched and has power. Would like to read more articles about their influence as it all sounds quite interesting from a popcorn perspective.
anotheraccount9 4y ago
"Proof-of-work mining is a crime against humanity". Really? If proof-of-work is an issue because of how we consume energy, surely the problem goes beyond crypto. Meanwhile, I really hope countries print bills in an ethical manner.
- jqpabc123 4y ago
  surely the problem goes beyond crypto. Most definitely. Did anyone say otherwise? But the fact that other problems exist doesn't change the fact that crypto adds to them. Meanwhile, I really hope countries print bills in an ethical manner. Are you sure you really want to compare the cost of printing to mining?
rvz 4y ago
> The final boss in Ethereum centralisation is, of course, the Ethereum Foundation. The behaviour of the blockchain is the behaviour of the code. Which this was subsequently tested in 2016 when... > The Ethereum Foundation and a majority of mining power decided to violate the immutability of the blockchain and wind back The DAO — because immutability lasts precisely and only until the big boys lose enough money. So not only immutability was a complete lie in 2016 with the nonsense of 'Code is law' now with the Merge happening to proof-of-stake, unsurprisingly, centralization and big money ultimately wins. So expect forks of the Ethereum PoW post DAO to just 'fail' like Ethereum Classic has done over the DAO fork. Further along Gerard's article about Ethereum becoming a security, I think it looks more clearer that it is going to be the case as soon as 'Staking as a service' proliferates towards many retail investors. As regulations are being much clearer, coins like Ethereum are going to be treading on a very thin line with the SEC and other regulators and if they are not careful it will land them in trouble like what is happening with Ripple with their XRP coin.
- blueprint 4y ago
  few people take eth seriously so i hardly think centralization and big money wins. ethereum doesnt even exist anymore if we say that there is something yet to win. so, eth lost a long time ago. we have needed a better solution since 2016.
  - kranke155 4y ago
    Few people take ETH seriously - lol sources ?
    - blueprint 4y ago
      - kranke155 4y ago
        Ethereum has thousands of developers, it’s minted millionaires and billionaires out of developers who made products like ENS, Uniswap and Curve, challenging such a hot fake as “people don’t take Ethereum seriously” is within the range of reasonable questioning.
h2odragon 4y ago
There's worry about a regulatory apocalypse when the government decides that existing laws apply to the crypto scams as well as the more traditional sorts. I wonder tho if the domino will fall the other way: the Fed declares some CBDC and the regulators explicitly allow the crypto derivitive kind of scams linked to it, in hopes of reigniting that fire to their more direct profit / reinflating an economic bubble. "finance as code" thinking, given access to the traditional financial scams, should be able to re-implement horrors undreamt of in the markets since the last dozen times they were tried and outlawed. But this time they'll have websites and new slang to describe their operation.
carlosdp 4y ago
> The Beacon Chain developers are not addressing the Infura problem in any manner whatsoever. They don’t seem to understand the question. It's not a problem, it's trivially easy to change what RPC an app / wallet uses. It's literally just changing a URL since the interface is all standardized. There are a lot of other much more important risks to solve that aren't mentioned in this article. The implication core devs don't understand the centralization risk of RPC services is absurd, as is much of this article.
- pa7x1 4y ago
  Alternative public RPC nodes, for those curious: https://ethereumnodes.com/ https://ethereumnodes.com/ Or you can set up your own, as doing so is permissionless. You don't even need a GPU or Ether. Just a regular computer, broadband and 2 TiB SSD. The article is filled with misinformation like the statement above.
- 0x64 4y ago
  Not to mention, a new groundwork for light clients was laid out in the first upgrade to the beacon chain. Come merge, clients could effectively poll for e.g. balances directly from the network, instead of going through Infura. More on Ethereum light clients from Chainsafe, the builders of Lodestar, a Typescript implementation of an Ethereum consensus client: https://blog.chainsafe.io/the-road-ahead-for-ethereum-light-clients-b6fdb7c3b603 https://blog.chainsafe.io/the-road-ahead-for-ethereum-light-... TL;DR: "Light clients enable more people to participate as first-class citizens, verifying on-chain data without relying on single and centralized JSON RPC endpoints."
  - davidgerard 4y ago
    "Could" is another word for "they don't." The typical user could use something other than Infura - but they don't. The typical user could use some future system that doesn't exist yet - but they don't. The typical user could cash out somewhere other than Coinbase - but they don't. The typical user could use stablecoins other than USDC - but they don't. This is covered in the article already. Default behaviour matters, a lot. Almost no Ethereum users are going to telnet 30303.
jacknews 4y ago
I'm not a crypto fan at all, but 'Blithering idiot' this, 'Stupid' that, just turns me off the argument, and even reinforces that the naysayers are just as rabid as the 'bros'.
- Chai-T-Rex 4y ago
  Based on your own standard, I'm wondering why people should take you seriously when you use terms like 'rabid'.
  - deleted 4y ago
    [deleted]
  - deleted 4y ago
    [deleted]
  - jacknews 4y ago
    - jubalfh 4y ago
      …a good answer from an odious twerp.
      - deleted 4y ago
        [deleted]
      - jacknews 4y ago
        I wouldn't usually bother, but this has a distinct style. Could it be ... the author, as a sock? Maybe it's a different belicose bald brit.
  - psd1 4y ago
    I don't agree with GP that naysayers might be "rabid" but I certainly know someone who was bitten by a bat(coin). "Rabid" is bang-on for at least some people. It's relevant and non-hypocritical. It may not be the best comment, but neither was yours.
randomran01234 4y ago
Is there any evidence that almost 100% of transactions use Infura? There are several other popular nodes as a service since the cited 2018 article was written: Alchemy, Quicknode, Moralis. Anybody running a full node, including home stakers, can point to their own RPC endpoint. When one of the popular nodes as a service goes down, many dApps and users will need to change their endpoint to another. I think the author might be overstating the concern of this centralization. The solution to RPC centralization is well known: light clients. It is on the developers roadmap but obviously they are prioritizing proof of stake and scalability.
- davidgerard 4y ago
  In 2012, you could presume cryptocurrency users had some idea what, say, cryptography was. In 2022, you can't presume a damn thing. As I noted in another comment, users could do all manner of things they don't do. In practice, defaults are overwhelmingly important. When Infura blocked all of Venezuela in March, due to an error in over-applying sanctions against Russia, some wondered if the Ethereum network was being blocked. No, it was just the app everyone depended on for almost everything. In the fabulous future, I'm sure it'll be great. In present-day reality, things are as I described them. Nobody actually cares much about Infura or other points of centralisation because approximately 100% of Ethereum participants in 2022 have a firm and unshakable ideological commitment to being in it for the money, on an extremely short-term horizon.
  - randomran01234 4y ago
    So your main argument is that people are too stupid to understand that Ethereum is not the same as Infura, and so when one goes down you may as well call them both down? Lol. Lack of education can be fixed. You can even help: instead of spreading poor information, try to educate your readers about the difference between a node as a service and liveness of the blockchain.
    - davidgerard 4y ago
      How dare I describe the network as it is, rather than in a fantasy world where people suddenly care about things they've shown no signs of caring about en masse in a decade? You'll excuse me if I keep doing that.
Brian_K_White 4y ago
I don't know why it's some sort of damning failure that addressing one problem doesn't address all problems. Did it claim to? Is the one problem not necessary to address? Does addressing the one problem somehow interfere with addressing the other problems? The main valid damning points I see out of all that is the example of a privileged minority rolling back something that was expressly designed and advertised to never be rolled back. All that stuff about users using centralized convenience services doesn't seem to actually invalidate the fact, or the value of that fact, that they don't have to. I haven't and wouldn't touch any crypto with a ten foot pole. And even I think this is more than a bit emotional and questionable.

30 points by davidgerard 4y ago

This guy has a weak understanding of how Bitcoin's proof of work functions and fails to acknowledge the fact that PoS is just putting the Eth supply in the hands of the rich

hunter-gatherer 4y ago
His article mostly says what you just said... He didn't elaborate a lot on PoW, but he didn't say anything wildly offcourse.
- bhdlr 4y ago
  > His article mostly says what you just said... He didn't elaborate a lot on PoW, but he didn't say anything wildly offcourse. He said that Bitcoin is centralized because there may be 51% of miners controlled by one entity. However that has been proven to be false (see The Blocksize War). Bitcoin is controlled by the nodes, not by who has the most mining power
  - jqpabc123 4y ago
    Bitcoin is controlled by the nodes, not by who has the most mining power Bitcoin is controlled by the exchanges. Whoever has the majority of the trading volume has most of the power and influence over it's price. Currently, this would be Binance. Please don't bother explaining how P2P is beyond their influence (it's not). Their influence is magnified by Tether which they can mint at will and is involved in over half of all crypto trades. Long story short --- the crypto market has been rigged --- by Binance. Collusion with others is likely simply due to the fact there is nothing to prevent it --- but it's impossible to say anything for sure because there is no external access. Blockchain is just an accounting system which tracks how badly the market is rigged.
  - SamPatt 4y ago
    Bitcoin is not controlled by the nodes. It is controlled by the miners, and a 51% attack is a serious concern. It always has been, and it always will be. It was designed assuming at least half of the network would not be malicious. The blocksize war absolutely didn't prove the superiority of the nodes. These are tall tales told by people who really wanted that to be true.
    - davidgerard 4y ago
      The decision was made by the exchanges. Bitcoin Cash wanted the BTC ticker, and didn't get it. That's why in the ETH merge, the issue is who the money goes with. Circle and Coinbase are going with the merge, so it wins.
eterps 4y ago
> fails to acknowledge the fact that PoS is just putting the Eth supply in the hands of the rich https://mobile.twitter.com/ercwl/status/1555719147941683200 https://mobile.twitter.com/ercwl/status/1555719147941683200
- blueprint 4y ago
  The issue is not the fact that proof of work is more centralized, the issue is the fact that proof of stake is truly breakable by taking out a small loan
  - landemva 4y ago
    You have a few more weeks to plan your attack. Let's see it. Regardless of small or big loan, it will be slashed. On PoW chain you would still have the mining hardware to run the attack again.
    - blueprint 4y ago
      what do you mean by slashed? having hardware is not the thing that allows you to attack a PoW network. especially if it's one of the ones that anyone actually puts any stock in the network security of. bitcoin's network security is a joke (although certainly better than PoS), so hopefully we're on the same page about that as well?
Chai-T-Rex 4y ago
I'm a bit lost on how the bitcoin supply isn't in the hands of the rich. Do they give out free mining equipment and electricity to the poor to equalize things?

quickthrower2 4y ago

the infura bit is interesting. Might be the leftpad of crypto? Every web3 tutorial will blindly say to use it. Makes it easy of course! And then it is entrenched and has power. Would like to read more articles about their influence as it all sounds quite interesting from a popcorn perspective.

anotheraccount9 4y ago

"Proof-of-work mining is a crime against humanity". Really? If proof-of-work is an issue because of how we consume energy, surely the problem goes beyond crypto. Meanwhile, I really hope countries print bills in an ethical manner.

jqpabc123 4y ago
surely the problem goes beyond crypto. Most definitely. Did anyone say otherwise? But the fact that other problems exist doesn't change the fact that crypto adds to them. Meanwhile, I really hope countries print bills in an ethical manner. Are you sure you really want to compare the cost of printing to mining?

rvz 4y ago

> The final boss in Ethereum centralisation is, of course, the Ethereum Foundation. The behaviour of the blockchain is the behaviour of the code. Which this was subsequently tested in 2016 when... > The Ethereum Foundation and a majority of mining power decided to violate the immutability of the blockchain and wind back The DAO — because immutability lasts precisely and only until the big boys lose enough money. So not only immutability was a complete lie in 2016 with the nonsense of 'Code is law' now with the Merge happening to proof-of-stake, unsurprisingly, centralization and big money ultimately wins. So expect forks of the Ethereum PoW post DAO to just 'fail' like Ethereum Classic has done over the DAO fork. Further along Gerard's article about Ethereum becoming a security, I think it looks more clearer that it is going to be the case as soon as 'Staking as a service' proliferates towards many retail investors. As regulations are being much clearer, coins like Ethereum are going to be treading on a very thin line with the SEC and other regulators and if they are not careful it will land them in trouble like what is happening with Ripple with their XRP coin.

blueprint 4y ago
few people take eth seriously so i hardly think centralization and big money wins. ethereum doesnt even exist anymore if we say that there is something yet to win. so, eth lost a long time ago. we have needed a better solution since 2016.
- kranke155 4y ago
  Few people take ETH seriously - lol sources ?
  - blueprint 4y ago
    - kranke155 4y ago
      Ethereum has thousands of developers, it’s minted millionaires and billionaires out of developers who made products like ENS, Uniswap and Curve, challenging such a hot fake as “people don’t take Ethereum seriously” is within the range of reasonable questioning.

h2odragon 4y ago

There's worry about a regulatory apocalypse when the government decides that existing laws apply to the crypto scams as well as the more traditional sorts. I wonder tho if the domino will fall the other way: the Fed declares some CBDC and the regulators explicitly allow the crypto derivitive kind of scams linked to it, in hopes of reigniting that fire to their more direct profit / reinflating an economic bubble. "finance as code" thinking, given access to the traditional financial scams, should be able to re-implement horrors undreamt of in the markets since the last dozen times they were tried and outlawed. But this time they'll have websites and new slang to describe their operation.

carlosdp 4y ago

> The Beacon Chain developers are not addressing the Infura problem in any manner whatsoever. They don’t seem to understand the question. It's not a problem, it's trivially easy to change what RPC an app / wallet uses. It's literally just changing a URL since the interface is all standardized. There are a lot of other much more important risks to solve that aren't mentioned in this article. The implication core devs don't understand the centralization risk of RPC services is absurd, as is much of this article.

pa7x1 4y ago
Alternative public RPC nodes, for those curious: https://ethereumnodes.com/ https://ethereumnodes.com/ Or you can set up your own, as doing so is permissionless. You don't even need a GPU or Ether. Just a regular computer, broadband and 2 TiB SSD. The article is filled with misinformation like the statement above.
0x64 4y ago
Not to mention, a new groundwork for light clients was laid out in the first upgrade to the beacon chain. Come merge, clients could effectively poll for e.g. balances directly from the network, instead of going through Infura. More on Ethereum light clients from Chainsafe, the builders of Lodestar, a Typescript implementation of an Ethereum consensus client: https://blog.chainsafe.io/the-road-ahead-for-ethereum-light-clients-b6fdb7c3b603 https://blog.chainsafe.io/the-road-ahead-for-ethereum-light-... TL;DR: "Light clients enable more people to participate as first-class citizens, verifying on-chain data without relying on single and centralized JSON RPC endpoints."
- davidgerard 4y ago
  "Could" is another word for "they don't." The typical user could use something other than Infura - but they don't. The typical user could use some future system that doesn't exist yet - but they don't. The typical user could cash out somewhere other than Coinbase - but they don't. The typical user could use stablecoins other than USDC - but they don't. This is covered in the article already. Default behaviour matters, a lot. Almost no Ethereum users are going to telnet 30303.

jacknews 4y ago

I'm not a crypto fan at all, but 'Blithering idiot' this, 'Stupid' that, just turns me off the argument, and even reinforces that the naysayers are just as rabid as the 'bros'.

Chai-T-Rex 4y ago
Based on your own standard, I'm wondering why people should take you seriously when you use terms like 'rabid'.
- deleted 4y ago
  [deleted]
- deleted 4y ago
  [deleted]
- jacknews 4y ago
  - jubalfh 4y ago
    …a good answer from an odious twerp.
    - deleted 4y ago
      [deleted]
    - jacknews 4y ago
      I wouldn't usually bother, but this has a distinct style. Could it be ... the author, as a sock? Maybe it's a different belicose bald brit.
- psd1 4y ago
  I don't agree with GP that naysayers might be "rabid" but I certainly know someone who was bitten by a bat(coin). "Rabid" is bang-on for at least some people. It's relevant and non-hypocritical. It may not be the best comment, but neither was yours.

randomran01234 4y ago

Is there any evidence that almost 100% of transactions use Infura? There are several other popular nodes as a service since the cited 2018 article was written: Alchemy, Quicknode, Moralis. Anybody running a full node, including home stakers, can point to their own RPC endpoint. When one of the popular nodes as a service goes down, many dApps and users will need to change their endpoint to another. I think the author might be overstating the concern of this centralization. The solution to RPC centralization is well known: light clients. It is on the developers roadmap but obviously they are prioritizing proof of stake and scalability.

davidgerard 4y ago
In 2012, you could presume cryptocurrency users had some idea what, say, cryptography was. In 2022, you can't presume a damn thing. As I noted in another comment, users could do all manner of things they don't do. In practice, defaults are overwhelmingly important. When Infura blocked all of Venezuela in March, due to an error in over-applying sanctions against Russia, some wondered if the Ethereum network was being blocked. No, it was just the app everyone depended on for almost everything. In the fabulous future, I'm sure it'll be great. In present-day reality, things are as I described them. Nobody actually cares much about Infura or other points of centralisation because approximately 100% of Ethereum participants in 2022 have a firm and unshakable ideological commitment to being in it for the money, on an extremely short-term horizon.
- randomran01234 4y ago
  So your main argument is that people are too stupid to understand that Ethereum is not the same as Infura, and so when one goes down you may as well call them both down? Lol. Lack of education can be fixed. You can even help: instead of spreading poor information, try to educate your readers about the difference between a node as a service and liveness of the blockchain.
  - davidgerard 4y ago
    How dare I describe the network as it is, rather than in a fantasy world where people suddenly care about things they've shown no signs of caring about en masse in a decade? You'll excuse me if I keep doing that.

Brian_K_White 4y ago

I don't know why it's some sort of damning failure that addressing one problem doesn't address all problems. Did it claim to? Is the one problem not necessary to address? Does addressing the one problem somehow interfere with addressing the other problems? The main valid damning points I see out of all that is the example of a privileged minority rolling back something that was expressly designed and advertised to never be rolled back. All that stuff about users using centralized convenience services doesn't seem to actually invalidate the fact, or the value of that fact, that they don't have to. I haven't and wouldn't touch any crypto with a ten foot pole. And even I think this is more than a bit emotional and questionable.