[vernon99]

This is a one-sided comment. There’s a lot of research going into different variations of proof-of-stake. 4 out of 10 largest crypto (by market cap) are PoS. There’s a lot of work Ethereum community (Casper), Cardano folks, Tendermint etc are doing to create better consensus models.

[nosuchthing]

Proof-of-Stake statistically equates to "Give the rich more money".

Consider Ethereum's stats (and other similar PoS minting methods):

  Presale ICO / Premine ( max cost $0.50 USD per ETH  )
  = 72,009,990 ETH
  
  Total Supply today (Feb 23rd 2018)
   = 97,800,000 ETH

  Source:
  https://etherscan.io/stat/supply

Now imagine a financial system where all the wealthy have to do simply own money (spawned from software or premine) to get more money. Or where voting is done by merely by controlling a large sum of money/tokens.

[adadad3442]

>Now imagine a financial system where all the wealthy have to do simply own money... to get more money.

You mean the current system?

[nosuchthing]

PoS is literally get paid for doing nothing but owning lottery tickets.

Normal capital flow with bonds, stocks, etc allow a legally binding agreement for mutually beneficial transfer of capital between parties.

[Anderkent]

Well, they get paid for putting that capital at risk and for keeping it locked into the system to provide consensus. It's a kind of a service.

[nosuchthing]

Except only the top few largest "stakers" are paid, others are either disqualified entirely for being too poor to stake, or will not recieve block rewards for being statistically irrelevant.

PoS is a lottery with reusable tickets. Winners get more tickets.

[redka]

PoS is an idea. There are implementation that reward everyone equally for the amount they put it (like semux)

[jacobr]

With PoW you use your money to buy mining equipment and you will get more money, and voting power. With PoS you buy more of the currency with that money instead.

[s73v3r_]

Right, but the rest of us also have to suffer due to the economic repercussions (or being unable to get an affordable graphics card without waiting forever)

[aianus]

Just pay more for the card and you can have one whenever you want. Isn't that what HN thinks employers should "just" do with tech talent because "there is no real shortage"?

[econ_th0]

the economist would say...

"affordable" is a opinion.

the market price is the market price, if you want one you have to pay more.

you are not entitled to a good at the price you think is "fair"

[wyldfire]

Nano uses dPOS and does not mint any new coins with PoS nor does not charge any tx fees. Instead of "Give the rich more money" it's more like "preserve the value of my money by fulfilling the promise of this coin".

[nosuchthing]

Nano (aka Raiblocks) is basically a scam.

How was the supply produced and distrubited? https://raiblocks.net/page/frontiers.php?limit=100

Nano/Raiblocks were created from software, a reproducable distributed database protocol. Except in the case of Nano, the vast majority of the tokens are in control of the owners with a few being given away to the public for clicking captchas.

https://www.youtube.com/results?search_query=raiblock+captch...

Consider, anytime you buy a cryptocurrency it means someone else is trying to cash out...

[wyldfire]

I don't agree, but I do think it's very wise to be suspicious of coins and their distribution mechanism.

[seanwilson]

> Except in the case of Nano, the vast majority of the tokens are in control of the owners

Do you have evidence of this?

[doots]

What evidence is there 90% of Nano distribution isn't owned by a single person?

This is a major aspect of transparency in decenteralized p2p protocols, and the issue with Nano is there's no paper trail or proof that the devs didn't take all the supply.

We do know 13% of all Nano in circulation was stolen in the Bitgrail hack.

[GhostVII]

Proof of work is the same, except instead of rich people buying more Etherium to get rich faster, they buy more mining hardware.

[nosuchthing]

Not entirely, PoS disqualifies poor accounts from receiving newly minted block rewards.

[trophycase]

This is basically how it is now. There is a non-zero risk to staking as well as the stock market/bonds

[CodeCube]

I'm having a hard time understanding the risk to staking ... is it just an opportunity cost risk ?

[bcohn91]

Yes, combined with the risk that the currency could go down in terms of the currency you care about.

[CodeCube]

Can you retract those funds at any time?

[zodiac]

What's your proposal for a more egalitarian reward model for block producers (in any consensus model)?

[curyous]

Proof of work, it requires continual investment if you want to get the rewards, not just sitting there watching the cash roll in.

[aoeusnth1]

How is that more egalitarian? It's still a conversion between capital and income.

It's like saying stocks that give dividends are more "egalitarian" because you have to reinvest them in order to gain the same return on investment.

Absurd.

[nosuchthing]

Equal payment for the same work/processing power.

[zodiac]

What does that concretely mean?

[bitL]

PoS is not going to be very popular as it removes the literal "money out of thin air" that was happening with GPUs in the past few years (coming to end in medium term). PoS strongly favors already well capitalized owners, instead of allowing new ones.

[twiceaday]

Doesn't PoS generate money out of thin air? It's just a matter of putting your dollars into stake vs hardware and electricity.

[nosuchthing]

Only for the largest account holders, whom statistically will receive most of the newly generated money (and even more as they continue to accumulate newly printed PoS tokens).

[twiceaday]

PoW distributes block rewards proportionally to hash power and these proceeds can be used to buy more hash power to achieve a compounding effect. From what I understand all of the viable PoS systems offer a fixed rate of return on the stake. This is like PoW forcing everybody to use the exact same hardware; a benefit to the little guy at the expense of the large account holders.

[aoeusnth1]

I'm confused - what's your objection? Should capital put into PoS not provide a constant reward?

Or are you under the impression that larger pools of capital provide disproportionate rewards?

[JustAnotherPat]

5% a year. You're better off keeping it on an exchange in case of a pump.

[coralreef]

What's this 5% figure from?

[ktta]

Casper atleast says it is going to be a linear return model, without the asymmetrical return you get with large scale efficiencies.

[tlrobinson]

Transitioning from PoW to PoS seems like a possible solution. Or shortcut the PoW phase by seeding your coin with snapshots of one or more existing coins that had a “fair” distribution phase.

[mrb]

The ugly truth is that proof-of-stake systems, at least current ones, give up decentralization properties. Users with the most funds (stakes) can effectively validate and rewrite the blockchain. Or in the case of a network split, the 2 chains can no longer be merged (because they implement "safety" mechanism such as preventing nodes from rewriting more than X blocks.)