Re: [bitcoin-dev] Opinion on proof of stake in future

From: Keagan McClelland <keagan.mcclelland@gmail•com>
To: Billy Tetrud <billy.tetrud@gmail•com>
Cc: Bitcoin Protocol Discussion <bitcoin-dev@lists•linuxfoundation.org>
Subject: Re: [bitcoin-dev] Opinion on proof of stake in future
Date: Wed, 23 Jun 2021 18:37:07 -0600	[thread overview]
Message-ID: <CALeFGL0MV8zoArWJsDU2-kruugR7PRTZRnFHBHn-kM9+3CQUMw@mail.gmail.com> (raw)
In-Reply-To: <CAGpPWDb2MwcFFXtvOhr6WC3aUK5yfYUyJKbxDeLYHqbzYU7i7w@mail.gmail.com>

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> That is in fact true of Proof of Work as well. If a colluding coalition
of miners with more than 50% of the hashrate want to censor transactions,
they absolutely can do that by orphaning blocks that contain transactions
they want to censor. This is not different in proof of stake.

This power does not translate into them being able to block your
acquisition of hashpower itself, a property extremely different than in
proof of stake.

On Wed, Jun 23, 2021 at 6:14 PM Billy Tetrud <billy.tetrud@gmail•com> wrote:

> >  This is not true in a Proof of Work system and this difference
> absolutely should not be trivialized.
>
> That is in fact true of Proof of Work as well. If a colluding coalition of
> miners with more than 50% of the hashrate want to censor transactions, they
> absolutely can do that by orphaning blocks that contain transactions
> they want to censor. This is not different in proof of stake.
>
> On Wed, Jun 23, 2021 at 11:14 AM Keagan McClelland <
> keagan.mcclelland@gmail•com> wrote:
>
>> > Premise: There is a healthy exchange market for PoS Coin X with tens of
>> thousands of participants bidding to buy and sell the coin for other
>> currencies on the market.
>>
>> The difference here though is that Proof of Stake allows the quorum of
>> coin holders to block the exchange of said coins if they are going to a
>> particular destination. Nothing requires these staking nodes to include
>> particular transactions into a block. With that in mind, it isn't just that
>> you require the permission of the person who sold you the coins, which I
>> can agree is a less dangerous form of permission, but you must also require
>> the permission of at least 51% of the coin holders to even receive those
>> coins in the first place. This is not true in a Proof of Work system and
>> this difference absolutely should not be trivialized.
>>
>> Keagan
>>
>> On Wed, Jun 23, 2021 at 2:30 AM Billy Tetrud via bitcoin-dev <
>> bitcoin-dev@lists•linuxfoundation.org> wrote:
>>
>>> >  Barrier to entry in PoS is being given permission by the previous
>>> owner of a token
>>>
>>> The idea that proof of stake is not permissionless is completely
>>> invalid. It pains me to see such an argument here. Perhaps we can come to
>>> an agreement by being more specific. I'd like to propose the following:
>>>
>>> Premise: There is a healthy exchange market for PoS Coin X with tens of
>>> thousands of participants bidding to buy and sell the coin for other
>>> currencies on the market.
>>>
>>> If the premise above is true, then there is no significant permission
>>> needed to enter the market for minting blocks for PoS Coin X. If you make a
>>> bid on someone's coins and they don't like you and refuse, you can move on
>>> to any one of the other tens of thousands of people in that marketplace.
>>> Would you agree, Cloud Strife, that this situation couldn't be considered
>>> "permissioned"?
>>>
>>> If not, consider that participation in *any* decentralized system
>>> requires the permission of at least one user in that system. If there are
>>> thousands of bitcoin public nodes, you require the permission of at least
>>> one of them to participate in bitcoin. No one considers bitcoin
>>> "permissioned" because of this. Do you agree?
>>>
>>> On Thu, Jun 17, 2021 at 1:15 PM Cloud Strife via bitcoin-dev <
>>> bitcoin-dev@lists•linuxfoundation.org> wrote:
>>>
>>>> Barrier to entry in PoW is matter for hardware and energy is
>>>> permissionless and exist all over the universe, permissionless cost which
>>>> exists for everyone no matter who because it's unforgeable.
>>>>
>>>> Barrier to entry in PoS is being given permission by the previous owner
>>>> of a token for you to have it via transfer or sale, both choices they never
>>>> have to make since there are no continuous costs with producing blocks
>>>> forcing it. A permission is an infinitely high barrier to entry if the
>>>> previous owner, like the premining party, refuses to give up the token they
>>>> control.
>>>>
>>>> You're skipping the part where you depend on a permission of a central
>>>> party in control of the authority token before you can produce blocks on
>>>> your rasberry Pi.
>>>>
>>>> Proof of stake is not in any possible way relevant to permissionless
>>>> protocols, and thus not possibly relevant to decentralized protocols where
>>>> control must be distributed to independent (i.e. permissionless) parties.
>>>>
>>>> There's nothing of relevance to discuss and this has been figured out
>>>> long long ago.
>>>>
>>>>
>>>> https://github.com/libbitcoin/libbitcoin-system/wiki/Proof-of-Stake-Fallacy
>>>>
>>>>
>>>> https://medium.com/@factchecker9000/nothing-is-worse-than-proof-of-stake-e70b12b988ca
>>>>
>>>>
>>>>
>>>>
>>>> On Tue, Jun 15, 2021 at 7:13 AM James MacWhyte via bitcoin-dev <
>>>> bitcoin-dev@lists•linuxfoundation.org> wrote:
>>>>
>>>>>
>>>>> @Lloyd wrote:
>>>>>
>>>>> Of course in reality no one wants to keep their coin holding keys
>>>>>> online so in Alogorand you can authorize a set of "participation keys"[1]
>>>>>> that will be used to create blocks on your coin holding key's behalf.
>>>>>> Hopefully you've spotted the problem.
>>>>>> You can send your participation keys to any malicious party with a
>>>>>> nice website (see random example [2]) offering you a good return.
>>>>>> Damn it's still Proof-of-SquareSpace!
>>>>>>
>>>>>
>>>>> I believe we are talking about a comparison to PoW, correct? If you
>>>>> want to mine PoW, you need to buy expensive hardware and configure it to
>>>>> work, and wait a long time to get any return by solo mining. Or you can
>>>>> join a mining pool, which might use your hashing power for nefarious
>>>>> purposes. Or you might skip the hardware all together and fall for some
>>>>> "cloud mining" scheme with a pretty website and a high rate of advertised
>>>>> return. So as you can see, Proof-of-SquareSpace exists in PoW as well!
>>>>>
>>>>> The PoS equivalent of buying mining hardware is setting up your own
>>>>> validator and not outsourcing that to anyone else. So both PoW and PoS have
>>>>> the professional/expert way of participating, and the fraud-prone, amateur
>>>>> way of participating. The only difference is, with PoS the
>>>>> professional/expert way is accessible to anyone with a raspberry Pi and a
>>>>> web connection, which is a much lower barrier to entry than PoW.
>>>>> _______________________________________________
>>>>> bitcoin-dev mailing list
>>>>> bitcoin-dev@lists•linuxfoundation.org
>>>>> https://lists.linuxfoundation.org/mailman/listinfo/bitcoin-dev
>>>>>
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>>

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