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Validators in proof of stake have less control than miners had in proof of work. They don't control the rules, they just control the order transactions get into

Validators in proof of stake have less control than miners had in proof of work. They don't control the rules, they just control the order transactions get into blocks. They can't even censor transactions unless a majority of validators/miners work together to do so. Unlike in proof of work, in proof of stake any validators that are seen attempting double-spending attacks can have their invested stake slashed; in proof of work, miners that attempt double-spend attacks don't lose their mining hardware and are free to continue attempting to manipulate the system.

verdverm 4y ago
What happens when 2/3 of the validators are run by companies who follow US financial rules and sanctions?
- wmf 4y ago
  Number go up.
  - verdverm 4y ago
    Wallets get blocked, people get banned, KYC4ETH
mccorrinall 4y ago
While validators can’t censor, they can play both sides: Nothing at stake is still not solved on ETH.
- AgentME 4y ago
  The nothing-at-stake problem was solved many years ago by introducing slashing. The earliest proof of stake systems did not have slashing (they did not actually put validators' funds "at stake"; the use of the word "stake" wasn't so literal yet) and were vulnerable to the nothing-at-stake problem because of that. A decent write-up: https://medium.com/coinmonks/understanding-proof-of-stake-the-nothing-at-stake-theory-1f0d71bc027 https://medium.com/coinmonks/understanding-proof-of-stake-th...
  - mccorrinall 4y ago
    And this slashing process does not solve the issue. Or well, it does, but it makes the whole system centralized and introduces a single point of trust. The bounty hunters, who find misbehaving validators which signed orphaned blocks, will slash the validators stake. But those bounty hunters are programs which are being run in Vitalik‘s basement. Not everyone will be able to run one like a normal validator. They are trusted entities within the network.
    - AgentME 4y ago
      Where did you get the idea that slashing is done by centralized/trusted bounty hunters? It's completely wrong and I'm not sure how someone could come to that idea in good faith. (Maybe you're misunderstanding some unrelated criticism made of an L2 system like Optimism from before it implemented fraud proofs?)
ftlio 4y ago
Miners in Proof of Work don’t control the rules. There have been multiple attempts to exercise hash power as political control in Bitcoin that have failed. There already exists precedent regarding the political power of running your own node with incredibly low capital requirements relative to mining. Ethereum is already in a battle over what consensus rules actually exist. Large scale staking enterprises such as exchanges are signaling their intent to follow extra-protocol conventions, and if they control a supermajority of staked ETH, they control the right to slash. The only way to have a voice in it is by acquiring $50,000 in ETH.

verdverm 4y ago

What happens when 2/3 of the validators are run by companies who follow US financial rules and sanctions?

wmf 4y ago
Number go up.
- verdverm 4y ago
  Wallets get blocked, people get banned, KYC4ETH

mccorrinall 4y ago

While validators can’t censor, they can play both sides: Nothing at stake is still not solved on ETH.

AgentME 4y ago
The nothing-at-stake problem was solved many years ago by introducing slashing. The earliest proof of stake systems did not have slashing (they did not actually put validators' funds "at stake"; the use of the word "stake" wasn't so literal yet) and were vulnerable to the nothing-at-stake problem because of that. A decent write-up: https://medium.com/coinmonks/understanding-proof-of-stake-the-nothing-at-stake-theory-1f0d71bc027 https://medium.com/coinmonks/understanding-proof-of-stake-th...
- mccorrinall 4y ago
  And this slashing process does not solve the issue. Or well, it does, but it makes the whole system centralized and introduces a single point of trust. The bounty hunters, who find misbehaving validators which signed orphaned blocks, will slash the validators stake. But those bounty hunters are programs which are being run in Vitalik‘s basement. Not everyone will be able to run one like a normal validator. They are trusted entities within the network.
  - AgentME 4y ago
    Where did you get the idea that slashing is done by centralized/trusted bounty hunters? It's completely wrong and I'm not sure how someone could come to that idea in good faith. (Maybe you're misunderstanding some unrelated criticism made of an L2 system like Optimism from before it implemented fraud proofs?)

ftlio 4y ago

Miners in Proof of Work don’t control the rules. There have been multiple attempts to exercise hash power as political control in Bitcoin that have failed. There already exists precedent regarding the political power of running your own node with incredibly low capital requirements relative to mining. Ethereum is already in a battle over what consensus rules actually exist. Large scale staking enterprises such as exchanges are signaling their intent to follow extra-protocol conventions, and if they control a supermajority of staked ETH, they control the right to slash. The only way to have a voice in it is by acquiring $50,000 in ETH.