Quote from: funkenstein on February 16, 2015, 11:12:21 PM

Quote from: e-coinomist on February 16, 2015, 10:05:46 PM

Quote from: funkenstein on February 10, 2015, 12:45:56 AM

Quote from: HalFinneysBrain on February 10, 2015, 12:01:07 AM

Bitcoin miners have no incentive to mine Bitcoins at a loss (relative to electricity cost). Rationally, each miner would shut off if the price goes below this point. (They might be in a position of having spent money on hardware that they can never hope to recoup, but still be operating above their electricity cost, as a way to reduce losses).

Large NXT holders should be willing to forge, even at a loss, because they risk losing all of the value of their stake if the network dies. Unless they give up completely, they should be willing to continue forging. Its not altruism, it is in their best interest to keep the network running so that they can hope to recoup the value of their stake in the future!

OK I can follow that logic, thanks. Next (no pun intended), lets look at network security on a per confirmation basis.

With bitcoin I can easily estimate the cost of reversing (by renting hash) a singly confirmed transaction: 25.15 BTC (25 coinbase plus average of 0.15 fees).

Now how much would a similar estimate run (renting NXT from holders to get the required stake) to reverse a singly confirmed NXT transaction?

2 confirmations 2x 25.15 BTC, 3x ... this is bekomming costly of people have some half hour of time to spend on security.

Staking coins usually have way faster cycle times. Even getting worser if you scale that up onto a half hour.

Thanks for your reply!

My point was, there is 25.15 BTC worth of incentive for double spend avoiding security in 10 minutes of confirmation on bitcoin. For NXT, it looks like there is jack shit in 10 minutes.

Can you make a better estimate?

You just brought up the main problem with virtual assets located on a block chain and why those projects seem to keep imploding or not really going anywhere. The security of the chain only accounts for the monetary value of the coins. When you make the coins also represent assets, PoW miners aren't receiving a cut of that, so there's no hash power security increase on their end. You then end up with high incentive to attack, and low incentive to defend.

For PoS assets, they're piggybacking on top of the system like PoW, the only difference is that PoS attacks are always far more catastrophic in the long term since coin ownership is network control. Then you have the fact that "ownership" is all defined by the legal system, and no legal system recognizes the authority of a block chain to determine who owns what when tied to assets in the real world.