[covemarkets]

"The issue is that you need to lock up money for PoS in order to mine it. That has a cost as you are forgoing interest on lending that money to an actually productive enterprise that is creating value. The net result is that funding and investment becomes more scarce because private investment is "crowded out" by people simply staking their Ethereum. This is the same harm caused by too much government debt "crowding out" private investment"

This is zero sum thinking. Yes, people will lock up money, which could have been invested elsewhere.

But you have to take into account the activity that happens on the chain as a result of POS, which itself will be productive presumably.

Thus the capital locked up in POS will be invested productively - because the activities enabled by POS themselves will be productive.

Of course, if there is nothing new that you can do as a result of POS - meaning, without POS you can already do all those things, then indeed there is no reason for POS. But the idea here ( which could be right or wrong ) is that POS will enable decentralized computation that would not happen otherwise.

EDIT: to downvoter: you can't say that locking up coins detracts from productive investment without evaluating what the chain ends up doing as a result of switching to POS. I mean, if you think that nothing useful will happen on a POS chain, that's a valid argument, but that's a different argument than simply worrying about locked up coins

[covemarkets]

curious, what the downvoters are disagreeing with specifically in this comment.