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Showing 7 of 7 results by venij
Re: Do you think Bitcoin should modify to POW + POS ? █████ Poll █████
Proposal: Protocol level rotation between PoW and PoS blocks with separate difficulties. Example Block A is found under bitcoins current PoW system with a difficulty of ~12billion (difficulty A) in a majority ASIC mining environment. Block B will then be found under a PoS environment that requires the coin-age of the blockfinder to be included and consumed in the block. Block B would be subject to a separate difficulty B such that a combined effort of CPU mining and coin-age (say difficulty / coin-age or difficulty to the coin-age root) could also be adjusted to similar 5 or 10 minute intervals.
How it fixes problem in PoW: 51% are based on the knowledge that the attacking party will eventually be able to control all blocks that are added to the blockchain. Interjecting a separate PoS system between blocks makes this impossible. At the same time, it frees PoW miners to work in their best interest and capture even upto 100% of the mining pool distribution.
How it fixes the problem in PoS: So called nothing-at-stake attacks are based on the assumption that any self-interested minter would continue to mint all forks of the chain in an effort to maximize his potential rewards (due to very low cost of minting). To the limit of such a case, all branches of the blockchain are continuously mined, and no single version is provably authentic. Interjecting a separate PoW system between blocks provides the resource intensive requirement to prevent the blockchain from spiraling out of control.
Side-thoughts
part of the original reason for PoS was to avoid the electricity cost of PoW. PoW miners could be setup to run on standby (only listening to the network communication) after a PoW block was found. Upon communication of a PoS block, they would again run at full speed. That savings vs. costs of thermal cycling or lost mining time could be optimized per mining hardware.
- block times could be modified for 5 minute averages (5 mins PoW + 5mins PoS = 10 minute overall) so that PoW rewards stay consistent during the cutover.
- As mentioned, a hard-fork or side chains using "burned" coins could be used for implementation
How it fixes problem in PoW: 51% are based on the knowledge that the attacking party will eventually be able to control all blocks that are added to the blockchain. Interjecting a separate PoS system between blocks makes this impossible. At the same time, it frees PoW miners to work in their best interest and capture even upto 100% of the mining pool distribution.
How it fixes the problem in PoS: So called nothing-at-stake attacks are based on the assumption that any self-interested minter would continue to mint all forks of the chain in an effort to maximize his potential rewards (due to very low cost of minting). To the limit of such a case, all branches of the blockchain are continuously mined, and no single version is provably authentic. Interjecting a separate PoW system between blocks provides the resource intensive requirement to prevent the blockchain from spiraling out of control.
Side-thoughts
part of the original reason for PoS was to avoid the electricity cost of PoW. PoW miners could be setup to run on standby (only listening to the network communication) after a PoW block was found. Upon communication of a PoS block, they would again run at full speed. That savings vs. costs of thermal cycling or lost mining time could be optimized per mining hardware.
- block times could be modified for 5 minute averages (5 mins PoW + 5mins PoS = 10 minute overall) so that PoW rewards stay consistent during the cutover.
- As mentioned, a hard-fork or side chains using "burned" coins could be used for implementation
Bitcoin transactions seem to have cheap fees, because everybody forgets that the block rewards currently act as subsidy to keep them low. On average, a transaction costs between $30 and $40 if you do take them in account, and thats way higher than most banks charge, and way too high for micro-transactions.
Now suppose that Bitcoin had no block rewards right now (like it will in the future), there can only be two possible outcomes: either that the hash-rate would drop to much lower levels, and the fees would stay the same. Or that the fees would rise to about $40 per transaction, and that the hash-rate would stay the same.
My gut feeling would say that even with a massive drop of hashrate, Bitcoin would still be secure, because the current hashrate seems like overkill to me. But in my previous topic (Alternative initial distribution of coins) various Bitcoin-veterans (like DeathAndTaxes) stated exactly the opposite: that Bitcoin wouldnt be able to survive if miners received just the fees and no additional rewards. So the expert opinion seems to be that the network would be unusable.
Now suppose that Bitcoin had no block rewards right now (like it will in the future), there can only be two possible outcomes: either that the hash-rate would drop to much lower levels, and the fees would stay the same. Or that the fees would rise to about $40 per transaction, and that the hash-rate would stay the same.
My gut feeling would say that even with a massive drop of hashrate, Bitcoin would still be secure, because the current hashrate seems like overkill to me. But in my previous topic (Alternative initial distribution of coins) various Bitcoin-veterans (like DeathAndTaxes) stated exactly the opposite: that Bitcoin wouldnt be able to survive if miners received just the fees and no additional rewards. So the expert opinion seems to be that the network would be unusable.
You missed a possible outcome.
Bitcoin could gain popularity, and the number of transactions per block could increase. Then the miners would receive increased total fees, without increasing the fee per transaction. If the current fee is approximately $0.06 per transaction, and a full block might have 4,200 transactions, the miners can already collect $252 per block. If we increased the maximum block size from 1 megabyte to 60 megabytes, then $0.06 per transaction would completely replace the 25 BTC per block subsidy.
More likely the fee will increase a bit, and the blocksize will increase a bit, that way we won't need to jump all the way to 60 megabytes per block. If we double the typical fee to $0.12, then we only need 30 megabyte blocks for the transaction fees to replace today's subsidy.
The other alternative (higher fees) also seem to make the network unusable, except for high-value transactions, which are a minority.
If the maximum blocksize is not increased, then this is a VERY likely outcome. At that point, bitcoin would most likely become a sort of clearinghouse for some other payment type.
So if both are true, is it safe to say that block rewards are just a subsidy for Bitcoin's ridiculously high transaction costs?
Yes, the block subsidy is just a subsidy for transaction costs. By way of inflationary effects, the entire network is splitting the current costs of mining. You could even look at it as a "tax" that every owner of bitcoin has to pay in reduced value for the bitcoins he holds to pay for the existence of distributed consensus.
Or both transaction volume AND bitcoin value increase over time to get the same
Re: How to Prevent a 51% attack: Multiple PoW algorithms + PoS ???????
To me it seems that the fundamental problem is that the entire block reward (coinbase + fees) is going to a single miner. Note I'm using the word "miner" in the strict sense of the word, i.e., the entity which decides what transactions to put in a block and gets to distribute the reward, i.e., a mining pool operator.
A solution therefore might be to have multiple PoWs and multiple rewards per block
Snip...
The effect of this will be that controlling > 50% of the network hash rate is not enough to consistently control all transactions. Increasing the number of PoWs per block from three to five reduces the number of transactions under the control of a single large miner even further. Of course, for a number of hash power large enough, the miner will again be able to control all blocks, but this number will be 80% for five PoWs, plus that it can never be sure it finds the PoW for a malicious self-inserted transaction before another miner, as it can not predict which set of transactions the PoW it finds is valid for. This reduces the ability to abuse its mining power.
A solution therefore might be to have multiple PoWs and multiple rewards per block
Snip...
The effect of this will be that controlling > 50% of the network hash rate is not enough to consistently control all transactions. Increasing the number of PoWs per block from three to five reduces the number of transactions under the control of a single large miner even further. Of course, for a number of hash power large enough, the miner will again be able to control all blocks, but this number will be 80% for five PoWs, plus that it can never be sure it finds the PoW for a malicious self-inserted transaction before another miner, as it can not predict which set of transactions the PoW it finds is valid for. This reduces the ability to abuse its mining power.
The idea of a 51% isn't that the majority shareholder finds all blocks ever. It's that he can mine ahead/around any short fork that is created by the rest of all miners. At that point, he rebroadcasts his version of a sidechain which then overwrites that shorter fork.
With this multiple PoW system, it's just a more elaborate version of the same system. Eventually a 51% miner would just overwrite the chain after taking a side fork.
Re: How to Prevent a 51% attack: Multiple PoW algorithms + PoS ???????
I posted a similar concept that I think is a bit more streamlined and reasonable over at Reddit this morning.
http://www.reddit.com/r/Bitcoin/comments/281ws5/pow_alternatives_to_avoid_51_concerns/
I don't want to hijack this thread, but I also don't want to clutter the forum with multiple discussions for the same ideas. If a mod feels appropriate, please move this comment or let me know to start a separate thread.
http://www.reddit.com/r/Bitcoin/comments/281ws5/pow_alternatives_to_avoid_51_concerns/
I don't want to hijack this thread, but I also don't want to clutter the forum with multiple discussions for the same ideas. If a mod feels appropriate, please move this comment or let me know to start a separate thread.
Hello... Stuck in this section?
We're having a great time in here trying to unlock our status and then post elsewhere
Enjoy your stay dude...
We're having a great time in here trying to unlock our status and then post elsewhere
Enjoy your stay dude...
Exactly - signed up months ago after seeing this site referred to on Reddit. This is my third post even though I come here somewhat regularly. It just irritates me to want to contribute to a discussion and then see I'm still restricted.
I understand the desire to keep the chaff out, but still annoying.
I've purchased twice on coinbase. It took a couple days, but it was pretty easy. Price you purchase at doesn't get adjusted after the transaction happens, so no worries about the slightly slow approval process.
Also saw a post on Reddit linking to the 10btc give-away and looking to post there. I've got 5-10 posts over there, I've been reading about bitcoins for a month or so (purchased 14 btc at the first of the year from coinbase). I've transferred my coins to a paperwallet which is probably above average.
I'll probably read some other posts here and stay logged in for a while anyway if the whitelist isn't granted (but this is #1
)
I'll probably read some other posts here and stay logged in for a while anyway if the whitelist isn't granted (but this is #1
)