[Kattywumpus]

I've never understood why GridCoin hasn't caught on yet. One of the chief complaints about Bitcoin is the utter wastefulness of its hashing mechanisms, with hundreds of times more computing power than the top 256 supercomputers combined devoted to pointless busywork just to secure the blockchain.

Imagine if you could have an equally secure cryptocurrency where all that computing power was diverted to curing cancer, discovering new drugs to treat dangerous diseases, understanding the human genome, researching dark matter, and so on. That's GridCoin.

And yet today Bitcoin is worth $14,484 and GridCoin is worth 12 cents.

[dnautics]

Because it's a silly concept. The whole point of hashing as a proof of work is that verification is faster than generation... It's a one way function. If you intend to use scientific computation as proof of work, then in most cases, verification is just as difficult as generation, so now all you've done is wasted computation by repeating your calculation each time you're verifying. In other cases (protein folding e.g.) which might be a one way function if formulated correctly the difficulty of work is not meaningfully measurable which creates uncertainty in the underlying value of the coin or the cost of mining. Another problem is that it breaks distributed trust since how can you be really sure that the problem is legitimately solved if it's scientific unknown.

[wellboy]

Why not reward computation power by the amount of kwh they have spent, regardless of if their computation was worth it or worthless.

[boulos]

kWh isn’t a good metric of computational output though. You want to encourage people to do more useful work for you; if that means they should tune their code for a fancy GPU, then kWh probably won’t correlate (a single package server CPU is about 145W, a server class GPU about 300W, but the GPU usually performs way more compute).

[dnautics]

I'm sorry, but the world does not work the way that you want it to.

[mpeg]

Then you have to verify, and as he says, you end up duplicating the work.

[dnautics]

duplicating is very optimistic. Over a distributed network, to achieve trust, it will have to be (n) where n is the average (over all time) number of agents that care about the validity of the chain. Then don't forget to multiply by k^2 where k is the expected blockchain chain length over all time. As an approximation...

[ktta]

I can't say why it hasn't caught on yet, but in my opinion, it is fragile, at least when compared to other coins.

Here the reward one gets purely depends on the score they get on specific BOINC projects, which can be seen as a single point of failure. So if someone is able to fudge their BOINC scores, they're able to create Gridcoins that they shouldn't get.

While other coins aren't as resourceful as this, I feel their network's security is backed by (atleast seemingly) air-tight cryptography. Not to say that Gridcoin is insecure currently, but the centralization with BOINC shows it doesn't have a bright future.

[KVFinn]

>Here the reward one gets purely depends on the score they get on specific BOINC projects, which can be seen as a single point of failure. So if someone is able to fudge their BOINC scores, they're able to create Gridcoins that they shouldn't get.

Yeah. I'm rooting for them to figure this out because it would be wonderful if all those GPUs could be doing science rather than arbitrary calculations, but if this coin ever went big, I can't see how it would deal with exploits like this.

[grubles]

Primecoin (sign: Ψ; code: XPM) is a peer-to-peer open source cryptocurrency that implements a unique scientific computing proof-of-work system. Primecoin's proof-of-work system searches for chains of prime numbers.

https://en.wikipedia.org/wiki/Primecoin

[akvadrako]

Primecoin is dead - go to their website and click on "Forums". Or find the network node explorer online.

[grubles]

Looks like it's very much alive: http://xpm.muuttuja.org/charts/

[taberiand]

Is or was? My (admittedly brief) look into this suggests it's dead or dying

[alexcnwy]

It's up 105% this week so someone thinks it's still alive.

[ashleyn]

* GridCoin offers comparatively low payout for the electricity required; you're not making money, you're just getting a discount on a research donation.

* GridCoin is highly inflationary and there's no inbuilt means of curtailing the supply.

[nerdponx]

There's nothing wrong with inflationary currency as long as the supply expands at a fixed/steady rate.

[beefield]

From macroeconomic perspective it does not matter if the monetary supply is fixed or just pre-defined, it is equally bad idea. If you want to have a currency that society runs on, that is.

[nerdponx]

I am talking about the rate of supply increase. A constant, predictable increase in supply over time would hopefully lead to constant, preditctable inflation.

DOGE is my favorite crypto for exactly this reason.

[beefield]

In early eighties many central banks tried targeting the amount of money in circulation to achieve stabe inflation, but failed. There is no reason to expect that a predefined rate of money supply would generate a predefined inflation. (See: gold, bitcoin)

[nerdponx]

Fair enough on the money supply point, although crypto currency so far has been somewhat isolated from the economics of nationstates, which are much more complicated than pure market forces.

My take: As long as people still "think in dollars" while they are spending cryptocurrency, purchasing power of cryptocurrencies will be pegged to the dollar. Neither gold nor bitcoin is "inflated" as currency. The dollar inflates (or doesn't), and if you want to pay for something denominated in dollars using something other than dollars, you simply convert at the current spot market rate. There won't be a Bitcoin macroeconomy until things are truly denominated in Bitcoin.

[dmichulke]

May I ask what macroeconomic perspective that is?

[beefield]

Of course. You can and want to adjust aggregate demand by monetary policy. I do not claim that current central banks do perfect job (biggest problem for the last decade has been inability to set properly negative interest rates), but at least to me it is obvious that of you do not manage aggregate demand you end up with massive cycles in economy that cause havoc.

[dnautics]

question: what is the neoliberal obsession over negative interest rates? The point of negative interest rates is to encourage borrowing and "reinvestment over saving under the mattress". Typically the lowest interest rates are given to institutional investors (aka the very wealthy) while "the rest of us" have to take on interest rates that don't beat inflation. "Reinvestment" usually means "supporting fortune 500 companies that are in index funds.

If you think about it carefully, it basically sounds an awful like trickle-down economics.

Of course, there's the babysitter's coop parable, but that seems like not a monetary failure, but the failure of a really silly centralized decision to make a unit of labor time be fixed instead of having the unit of labor float in value.

[dnautics]

It's terrible because you can't steal from the poor to fund the investment adventures of the wealthy.

[AndrewBissell]

> pointless busywork just to secure the blockchain

Well if it's securing the blockchain it can't be that pointless.

Some good arguments here for why "useless" proof-of-work is actually quite useful: http://www.truthcoin.info/blog/pow-cheapest/