Bitcoins/Litecoins/Virtual Currencies

Torrid said:

PoS has fewer participants and has more concentration of influence compared to PoW.

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This is not true in the slightest, where did you come up with this? PoS has more participants because you can get to the point where you're staking a full node on a goddamn cell phone.

Torrid said:

In PoS, the stakers are the replacement for the miners who are also the whales whereas in Bitcoin they are much more separated (i.e. miners have a much, much smaller share of the outstanding coins). This greatly increases their influence. (hell, in ETH the developers are are the whales and miners and devs all-in-one) Staking is centralizing not only because all new coins go to the already largest coin holders but also because all but the largest whales must use pools to stake which means they do not have control over their funds while doing this (not your keys etc).

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I don't know what the fuck this gobbledegook is about, but no, it's very much in the design that people should be able to stake from their own home without needing to engage in economies of scale ala Bitcoin mining rigs that nowadays require a goddamn datacenter to be profitable. How can you have such an ass backwards view of literally everything? Just completely proving my point that only idiots think PoW is somehow more "decentralized" than PoS.

The only way to be profitable with PoW 'is at scale'? People on this very forum are mining ETH right now using their GPUs. You can still mine bitcoin with an ASIC if you want to pay 2 grand for it or whatever and put up with the noise. The limiting factor is the cost of electricity, not the number of ASICs.

I'll explain myself a second time: since ETH PoS doesn't have delegation, you must join a pool to stake. Similar to an exchange, once you join a pool and send them your ETH, that ETH is no longer under your control and you must hope that the pool will give it back to you later. Pools centralize control that way and assume authority for all their stakers. If they go rogue or decide to abscond with your funds, then you're screwed. This is different than PoW mining pools because there, the pool operators never have control over your hardware so you don't have to hope they'll give it back later.

You can argue that, from the perspective of a user that just wants to invest money and doesn't care about centralization, that it's easier to stake than it is to mine. Well, ok. But you can always buy shares in public mining companies too if you want to profit from mining. And that has no counterparty risk and your coins aren't locked up.

The cost of running a PoS validator is almost nil, so you're pretty much immediately profitable when staking. Per dollar invested, returns should be similar in the long run, but there are arguments both ways.

Torrid said:

I'll explain myself a second time: since ETH PoS doesn't have delegation, you must join a pool to stake. Similar to an exchange, once you join a pool and send them your ETH, that ETH is no longer under your control and you must hope that the pool will give it back to you later. Pools centralize control that way and assume authority for all their stakers. If they go rogue or decide to abscond with your funds, then you're screwed. This is different than PoW mining pools because there, the pool operators never have control over your hardware so you don't have to hope they'll give it back later.

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This is not at all how PoS works and you need to do some research. You have to be seriously retarded to think that Vitalik Buterin for some reason just can't see this.

You can solo stake with 32 ETH if you have that much, but since validators are selected at random, this is akin to mining BTC without a pool-- so the chance of you being selected as a validator is extremely low. Hence why mining pools exist in the first place: so miners could get tiny fractions of block rewards instead of praying that they hit the lottery.

Dude, I just linked tweets of two staking pools blowing up earlier today. Some day pools may be decentralized (Rocket Pool apparently is trying this) but not for awhile. Even then there will still be some counterparty risk.

If I'm wrong, explain it to me. Don't toss 'Vitalik is God' at me.

Good luck T Torrid I've tried to explain this exact concept here and for whatever reason people just can't understand it. PoS = people with the most ETH control the consensus. PoW = anyone with hardware + electricity can contribute. One of these is distributed by its very nature (HW is mobile and electricity prices will drive miners to spread out) the other rewards those with the biggest bags.

The cost of running a validator itself is irrelevant if you need a meaningful stake to participate in the first place. I've run a validator an am familiar with the requirements

Tmac said:

So, how does PoS work?

From my own understanding the 32+ ETH poolers do control the consensus. Which, I mean, theoretically is no different than the huge BTC farms controlling the consensus. I guess the barrier to entry rn for staking 32 ETH is $64k and probably a similar ASIC investment for mining BTC?

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You can meaningfully contribute to BTC for a much lower buy in than ETH at current prices. The trick is PoW has a higher cost over time due to electricity requirements vs PoS where the investment is almost all up front. The cost of each consensus method is a separate issue to their security and decentralization.

This assumes you're not handing your keys to a PoS "pool". Solo staking.

Dominos keep falling

Lawmaker Carlos Rejala is now leading a bid to implement legislation to make Paraguay the second country to do so.

On Thursday, he announced on Twitter that he would be introducing a bill in the country’s National Congress in July that would likely mirror El Salvador’s new cryptocurrency law.

As well as introducing measures to make Paraguay a hub for foreign crypto investors, the draft legislation - which, according to Rejala, will be published on July 14 - would also seek to establish Bitcoin as legal tender.

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Torrid said:

You can solo stake with 32 ETH if you have that much, but since validators are selected at random, this is akin to mining BTC without a pool-- so the chance of you being selected as a validator is extremely low. Hence why mining pools exist in the first place: so miners could get tiny fractions of block rewards instead of praying that they hit the lottery.

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Completely wrong. When the 32 ETH requirement was made, that was a little over a thousand dollars and it is just for this beta chain -- the vision is that anyone can stake from their own home, there will eventually be no requirement or it will be very small. In PoS, you don't get rewarded just for finding blocks, but also for attesting the blocks are valid, thus rewards are distributed as interest on your stake based on total ETH staked. The reason to pool resources currently, and moving forward for that matter, are entirely technical as users may not want to deal with handling their own keys, let alone maintaining uptime on a full Ethereum node.

Tmac said:

From my own understanding the 32+ ETH poolers do control the consensus.

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This is the beta chain and is deliberately engineered for pooling resources, once it hits mainnet staking will massively open up.

Lots of great info coming out here.

EDIT: This is where I think a lot of the value from Truebit will come down the line (emphasis mine):

stskeeps said:

There's a graph of millions of decentralised identities and I want to submit an update to one of them, TrueBit can help confirm this update is correct, signed correctly, etc and put out a new updated merkle tree/hash/IPFS CID/etc. When people download that graph, they can be sure it's correct.

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Tmac said:

There's a graph of decentralized identities; what is an example?

And I want to submit an update to one of them; what does this mean?

Is there some greater context here I'm missing, bc I have no idea what this is referring to.

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Decentralized identity is basically the concept that your data exists in multiple locations, so your identity is itself decentralized. I'm not too familiar with what the 'graph' means in that context, it's not blockchain related I don't believe, but this is Zippie's primary focus. Submitting an update to a decentralized identity is exactly what it sounds like, the ability to create/update/delete pieces of it.

EDIT: W3C Decentralized Identities: Decentralized Identifiers (DIDs) v1.0

EDIT2: I don't mean to say that the value will be driven specifically by truthful DID demand, but rather by truthfulness itself. Machine Learning applications are the most exciting aspect of this for me, but that's years off.

Tmac said:

So, it's been stated that there's a goal to open up pooling? I'm assuming the protocol will change and anyone with any amount can stake?

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Yep, that's been the official goal of PoS since forever, and keep in mind 32 ETH was barely more than a thousand dollars (if that) when it was determined.

Ironically Guy just dropped a PoW vs. PoS vid today.