About POS, interesting features and designs

Mining
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This would not have happened if there was only a community of crypto-punks holders and coders behind the back of the industry. You and I would not know anything about cryptocurrency today if ever such people as Charles Shrem, Roger Ver, Barry Silbert, Cameron and Tyler Winklevoss and many other businessmen would not want to make money on these technologies.

I agree with this, but times are changing. We begun with CPU, than GPU, than Asic,now POS/POA/others are cominng, things and tech are moving on. There is no logic in having them static in a given state.

Consumers didn’t need these computing powers. They needed beautiful boxes and LEDs. And I will say this. Bitcoin - it was he, the old man Bitcoin again rejoiced this technology race. Give a little more time and the chips will be more economical tenfold with the same power as it is now. And this will be just the beginning of the tech race. Competition and market economy are the strongest motivators for humanity.

I would agree to this IF the computing power is needed for solving something, but that’s not the case. ALL this POW computing power is used for finding a block, not for solving it, that’s the problem. It’s an uncessary race. Mostly 99.999% are used for this and 0.001% for solving the real important process. In POS this is eleminated as it makes no sense to have so much computing power used for nothing.

And the second… The lion’s share of the crypto market capitalization came through electricity and the cost of ASICs, and not through the exchange. This is what I mean when I talk about prime cost.

I think here you have a wrong understanding of what prime costs really are and what they are used for. Let me explain.

  • First of all Prime cost doesn’t really fit into crypto as it refers only to materials and labour and excludes everything else. In case you stil want to use prime cost you have exclude electricity as it’s not used in the “production process”, remember you need only less than 1% for solving it and 99+% are used for other tasks (finding the block).
  • Second, a higher prime cost doesn’t make it automaticlly more value as it’s most often an indicator that something is not competive enough. If producer A has prime costs of 100$ for product X and producer B has prime cost of 50$ for product X it’s no rocket science that producer B is more competive than producer A.
  • Third, you should refer to Factors of Production instead prime cost as this perfectly fits what happens. (See link at the end). But even than, it’s again far from optimal as using resources that can not be used again, are lost and and and, like electricity, hardware that has no more any value (Asics) doesn’t again make sense if these factors can be optimized. Too much is needed for the same process, again, you solve the very same process in POS as in POW, simple as that.

And one more thing. When I need to measure the potential of cryptocurrency, I just look at the graph of complexity. Where should I look in the case of a POS-coin? :face_with_raised_eyebrow:

Not sure what you have in mind here and how the potential of cryptocurrency and graph of complexity fit together :thinking:

  • I personally measure the potential of a cryptocurrency by several factors beginning from transaction speed, transactions/s, scalability, whatever not. There is no difference in comparing them.
  • About graph of complexity i only can guess that you have in mind the difficutly chart, or? In case that’s correct, you have this on POS coins too, just simplified. In case you have something else in mind please explain.

References:

prime cost, noun, the direct cost of a commodity in terms of the materials and labour involved in its production, excluding fixed costs.

fixed costs, For businesses, fixed costs include anything that must be paid for production to occur, yet they remain the same whether production is high or low

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Someone else seems to have the very same thoughts like me :grinning:

Interesting parts:

  • The number one problem for the Blockchain to go mainstream is scalability. … The Visa network can process approximately 2000 transactions per second versus 5 to 7 for Bitcoin …

  • The Proof of Work algorithm that the existing Blockchains including Bitcoin and Ethereum employ to validate transactions is extremely inefficient.

  • In addition, they will herald the dawn of a completely different type of internet i.e. an internet of value where virtually anything of value (i.e. money, commodities, equity shares etc.) can be transmitted online in a trusted and economically inexpensive way. Therefore, the future of the Blockchain depends on the success of the Proof of Stake consensus building mechanism. But then again, it could be a totally different world than we imagine today.

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Out of curiosity, are there any PoS coins that have a low supply (21M) like Zcash?

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Decred uses hybrid PoS/PoW with a 21M cap and I think their approach is cool

no flame plz

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Supply is relative, so I’m not too sure why it matters here.

My opinion on PoS is it’s a great method once the reward has reached almost nothing. People will always stake for the good of a coin, but the number of people who will use up electricity in PoW is almost nothing and leaves it far too vulnerable for a 51% attack.

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This one also talks about scale

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Yes, of course, even some i know with less than that, but these normally don’t make it into the top 100 by market cap, just some that immediatly came into my mind without checking any further…

  • Factom 8.753.873
  • Dash (Hybrid) 18,900,000
  • Decred (Hybrid) 21,000,000
  • Horizen (Hybrid) 21,000,000
  • Mixin (XIN) 1,000,000
  • Neblio (NEBL) 14,470,784
  • Tokenpay 19,613,100
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Very interesting article that fits it up pretty good:
Blockchain Scaling, Why PoW Networks Can’t Scale

Conclusion from article:
And here we come to the absolute core of the issue, the single weak point in the whole framework. Throughout this article there has been one main theme. We can manipulate transaction size, block size and block time, but who processes it? The node. At the end of the day, only one node generates any given block. As long as every node independently verifies the entirety of all transactions in the network, the network can only process as many transactions as one node is capable of. In a trustless and decentralized network, that number will always fall short of the goal.

So what now? The only way to scale to this level of transaction throughput is to divide the burden of verifying transactions in the network between nodes. In PoW networks, there is no way to separate the network.† As long as there is some probability that the chain will switch over to another alternate chain, reverting transactions, every node has to verify everything. If there is no chance transactions of a certain age will be reverted, there is no reason to have nodes maintain a complete history, just a state of accounts.

As we saw in Part 1 of this series, the only way to accomplish this is by using some form of Practical Byzantine Fault Tolerance or PoS as these frameworks enable explicit finality, opening up the possibility of having nodes do less work to verify transactions.

So in this sense, practical global scaling is a function of finality. This is why PoS is the future of blockchain networks.

https://medium.com/coinmonks/blockchain-scaling-30c9e1b7db1b

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Proof of Importance at XEM/NEM explained:

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That’s great. It sounds good after reading about POS features and designs

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It’s not perfect either, but at least 10x better than POW…

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Just came across an interesting read, here the most interesting parts on why POW is flawed:

This means that rich miners and wealthy countries will be awarded control over blocks more frequently than their less financially-abled counterparts. Plus they will be choosing which (large) transaction fees are worth selecting from the [mempool]. This sounds so much like banks, albeit with far more turnover.

Bitcoin and Ethereum are talked about as though they are decentralized. But a careful examination reveals that they are more accurately described as serially centralized. At any given moment only one peer is managing the ledger.

By unchaining crypto and removing blocks* (as mentioned above), we can validate transactions in realtime on a coin-by-coin basis. There is no need for a big man to paint a given transaction in the context of all transactions throughout the currency’s history.

Have finite numbers of coins from the outset.
While coins likely need some incentives to drive adopters away from fiat, we can at least aim to do away with excessive inflation. Awarding coins to block managers inherently means that people who are able to mine (i.e. powerful persons) get the fruit of that value before the inflation in the system is felt by the people who are unable to mine (i.e. the marginalized in the system). It is true that this issue will eventually go away in Bitcoin as the block awards diminish, but we can still aim to do better with future currencies. All coins that will be in the ecosystem should exist at the system’s genesis.

As much as possible, lower the cost of entry (think smartphones).
We want people to be able to have full access to all the ins and outs of a currency without specialized equipment. Bitcoin mining does not allow for this. Unfortunately, some level of sophisticated technology will be required to operate currencies. Although only 36% of the world has a smartphone, we will at least be one step better if we can make all the features of a currency available on such devices. As it stands currently, the percent of the world that owns a Bitcoin mining rig is unknown, but best estimates back in 2015 put it at about 100,000 people, or .00001% of the world’s population. Even if that number has increased 10X since that time, it is inexcusably small for running a currency that keeps tyrants at bay.

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Ethereum testing POA, Proof of Authority …

https://bravenewcoin.com/insights/ethereum-goerli-testnet-ready-for-experimentation

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Voting on proposals doesn’t require a switch to POS, it requires some method of determining who is qualified to vote and a type of blockchain transaction that can accommodate voting. Also, if those proposals are anything more than user feedback and feature requests it also requires a blockreward structure that provides for a budget to attract proposals for other work outside of the foundation to be done. Not that I’m opposed to POS.

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Of course it doesn’t, but it would be way more effective. Logically a lot more people would hold their balance in their wallets instead on exchanges. I’am as well pretty sure someone that uses POS gives his wallet and featues/options way more attention as someone without a POS staking wallet.

Out of curiousity, do you know a pure POW coin that has voting in it’s wallet as i’am onlly aware of POS coins so far, but of course i didn’t check them all.

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This has identified the main scaling issue, but then incorrectly attributed it to PoW. The purpose of the ledger layer, whether it uses PoW or PoS or something else, is merely to implement an append-only ledger. Verification of consensus validity is a separable concern that belongs to the layer immediately above the ledger layer. (*)

Frankly, PoW doesn’t do a very good job of supporting the ledger layer: it wastes a lot of energy while failing to achieve adequate decentralisation and cost of attack. (These are not even controversial statements any more.) But those criticisms are independent of scaling.

To do “L1” scaling of a blockchain system, you indeed have to improve the asymptotic complexity of validation. The problem isn’t that each validating node has to validate every block; the problem is that each validating node has to validate every transaction. We know how to solve this: Coda-style succinct block chains. These lower the overall validation cost to a constant cost per node per block, independent of the number of transactions (or accounts). The proving cost is parallelisable, and the coordination costs between provers are manageable. The storage costs are also excellent (account holders have to keep track of a witness that is of logarithmic size in the maximum number of accounts; validating nodes only need constant storage). For privacy you also need a private network layer, but that layer is no longer relied on for consensus, and so old messages need not be stored.

Now, is PoW an obstacle to switching to a succinct block chain? Absolutely not. The mechanism for ensuring that the chain is append-only and eventually consistent belongs to the ledger layer, and is almost orthogonal to design decisions in the consensus validation layer. The validation layer needs to be able to check that the proof of work (or stake, or whatever) and difficulty adjustment is correct, but that’s all.

(*) It’s unfortunate that we don’t yet have a clean model of blockchain system layering, as we do for networks. “L1” and “L2” abstractions are inadequate. We’ll get there when the design space has been more thoroughly explored.

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PoW + Coda + Z-Transactions = :hearts:

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Interesting approach by NULS and how they try to get maximum decentralization while staking.
Super easy made and to choose which nodes to support …

Good explaination here:

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Expaination on long range attacks on POS and the possible counter measures …

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39 days-ish

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