Quote from: iruu on February 17, 2014, 10:42:19 PM

Quote from: Come-from-Beyond on February 17, 2014, 09:56:36 PM

Nxt is mentioned here - http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2393940 (It Will Cost You Nothing to 'Kill' a Proof-of-Stake Crypto-Currency)

Resume of this paper: All PoS coins will die except Nxt coz it's 90% attack-proof.

It doesn't matter how many coins are needed for destruction in his model, even 99.9% attack-proof currency would fall.
It doesn't matter for NXT and other PoS currencies, because it's a ridiculous model.

Short summary:
Each unit has a known, true value.
Holders are willing to sell their coins at higher price than their real value.
An attacker has enough money to buy enough coins (using "true" valuation) to destroy the currency.
Because he can do it, everyone sells his coins for nothing, because if he does buy the coins, anyone left holding will lose money. This causes the price to go to zero.
Therefore, it costs nothing to destroy any PoS currency.

pure genius. let's sell nxt, everyone.

How can they assume that the price per unit (aka 1 NXT) will stay the same if someone is buying up a large quantity of them? The more the attacker buys, the more the price will increase (exponentially) because other people will see the price rising and want to buy too. No one is going to sell their coins for "0" just because someone on the internet claims they can buy out all of PoS instantly - which they cant anyways, because not all coins are for sell on the market at any given time. For comparison, I think only ~1-2% of Bitcoins are moved a day (volume): http://bitcoincharts.com/markets/. If someone bought up that 1%, Bitcoin price would be in the thousands, with more and more people willing to buy and sell higher and higher.

Also another scenario: If everyone knows this guy has the money to buy out a significant portion of the coins, wouldn't they just hold because they know he wants a certain amount and will pay whatever price to get it? Basic market forces here, if everyone knows there is huge demand, they are going to put their selling price higher and higher until the supply matches the demand.

Last bit: Is the author's use of "cost nothing" an exaggeration? Like I mentioned earlier, no one will believe someone who claims he can buy out any PoS currency until he actually does it. Therefore, it does cost something, and the attacker would have to be willing to part with $millions-$billions of his own money. And then there's the fact that NXT is 90% resistant, so he'd pretty much be giving all (90%) of the current stakeholders a incredibly large sum of money.