Re: [ARTICLE] Decentralized Objective Consensus without Proof-of-Work
You are simply forcing renting instead of outright sales, but you can't stop sellers and buyers from pursuing that which generates the most value for both of them. Again I urged you to study the economics.
I'm aware of the economics of bribe attacks (Chapter 3.8.1, http://bitfury.com/content/5-white-papers-research/pos-vs-pow-1.0.2.pdf). But these attacks rely on an different security model than shorting or buying enough stake/accounts for attacking. As you say, the large scale powerbrokers could publish an offer and they would be successful only if they could convince more than 50% of the account owners. However, by doing so, their plot would be public and might result in counter measures taken by the "honest" minority of the community and eventually lead to a fork.If new accounts are growing fast enough to render old accounts irrelevant, then the power-law superior "investor" buys more new accounts than everyone else.
New accounts are created at the same rate as blocks, therefore even a power-law superior investor would need a very long time to build up the required impact, assuming that the current owners use their accounts (for which they had to pay) for minting for long periods.Perhaps they can even devise a way to buy new accounts that have their chosen private key which the seller has never seen? Do you cryptographically force the creator of a new account (minter) to sign the private key (and can this be done without revealing the private key)?
Yes, that's the way it works. The seller won't get knowledge of the buyer's private key.
There is usually assumed to be an orders-of-magnitude difference between the number of users of a system and the number of mining accounts.
I don't know how you plan to gain billions of adoption from users and also expect then all to invest in interest bearing tokens and perform mining duties. There seems to be a mismatch in incentives between what would entice billions of people to use a coin and investing. Most people aren't investors, else we would not have a power-law distribution of wealth.
My model offers two different types of accounts: free accounts that everyone can create by generating a key pair and minting accounts which are rate-limited. Only the latter are eligible for minting. People who don't have enough money can use free accounts for their transactions.I don't know how you plan to gain billions of adoption from users and also expect then all to invest in interest bearing tokens and perform mining duties. There seems to be a mismatch in incentives between what would entice billions of people to use a coin and investing. Most people aren't investors, else we would not have a power-law distribution of wealth.
Also with PoW, the miner isn't locked to one private key. His mining equipment is orthogonal to any cryptographic key.
Yes, hacking the private key of a PoW coin wouldn't
And this hacking issue is one of the security problems for PoS in fact (especially when most of the coins might be stored on an exchange).
Agreed, hacking is certainly an issue for a PoS coin in some cases but assuming that the keys are stored at a lot of different places, I doubt that any hacker could grab the majority of them.Yes, hacking the private key of a PoW coin wouldn't
And this hacking issue is one of the security problems for PoS in fact (especially when most of the coins might be stored on an exchange).
Investors do what is rational. Investors are not users because most people can't be investors (they don't save enough).
Sure. Some investors might also think that they'd be better off by participating in a counter-collusion in order to create an honest fork (without blacklisting the transactions) and split the coin. It's even possible that the new currency would be more worth than the old one.If ROI from minting is so much lower than interest, then why will anyone bother to mint and mine? Vitalik pointed out that altruistic prime is not stable for an undersupplied public good.
And since you've made the return from honestly minting and mining so low, i.e. you have created a power vacuum, why wouldn't it be an incentive to rent or collude to earn more from that aspect of the assets, such as for example if the TPTB want to blacklist some transactions (some dissidents or enemies) without destroying the value of the ecosystem.
I agree that it's a bad idea to rely on altruistic prime. However, as for low ROI of minting, the devil lies in the details. The ROI consist of two parts: The interest on your stake and the payments received for selling child accounts. While the first part mainly depends on the amount of your stake and differs from person to person, the second part is actually low because you rarely get the chance to create blocks. Once you have built a block, you have a clear incentive to sell it for the market price. And since you've made the return from honestly minting and mining so low, i.e. you have created a power vacuum, why wouldn't it be an incentive to rent or collude to earn more from that aspect of the assets, such as for example if the TPTB want to blacklist some transactions (some dissidents or enemies) without destroying the value of the ecosystem.
Of course, if an attacker is able to bribe the majority of the investors, the currency could be attacked. But for effective blacklisting of transactions, it's not enough to just discard the banned transactions from your blocks since the remaining nodes could put them into their blocks later on. You would also have to orphane every block that contains such transactions, which means that you would actually refrain from creating a block and selling the child account attached to it. That's why the attacker would have to pay a higher bribe than the market price of the accounts to every minter that provides evidence of orphaning a block (that he could have built otherwise).
Ultimately, the attacker would have to keep paying the market price for at least 50% of the ongoing production of blocks/accounts as long as he wants to maintain his attack.