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Comment by SavantIdiot | Hacker News Reader

Agreed. However it still is dominated by the "haves" vs the "have nots". Proof of stake is awarded to those with the largest stakes, which favors state-sponsored miners and works against decentralization.

I like how Monero's RandomX is designed to level the playing field: ASIC miners don't significantly improve over CPU mining so more people can participate in mining. Of course, this doesn't address pools, but it is a start.

Yay proof of stake!

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I would argue that under both proof of stake and mining your income is always directly proportional to the amount invested, either in equipment or stake.

The main difference is the minimum barrier to entry, however under PoS you have access to various pooling services, which simulate consumer scale mining (complete with the associated inefficiency).

Except under mining, increased investment opens up access to better equipment like ASICs, access to cheaper energy agreements, etc. But no amount of $ unlocks the ability to validate faster (per unit staked).

And then everyone gets their hands on this tech so the mining difficultly goes up and you are back to square one.

History of stuff like Antminers has been stages of private access, high end market, then low end ...

But while products are moving down those stages, more wattage-efficient ones are entering at top.

I think you're right that ROI curve will get closer to linear (utility costs aside), but I don't think it's going to be a very fast progression.

To clarify: I don't think proof of stake is perfect.

I think the original pie in the sky dream, as hinted at in the Bitcoin white paper, was for decentralization through anyone (all the way to students in their dorms) being able to participate in consensus.

I don't think proof of stake gets things all the way there, but I think it does get closer to a linear ROI curve, compared to how proof of work is right now.

>However it still is dominated by the "haves" vs the "have nots". Proof of stake is awarded to those with the largest stakes, which favors state-sponsored miners and works against decentralization.

where is the difference to mining? To mine you need GPUs and electricity which you can equate to $$$, just like capital you lock up under PoS. it effectively makes no difference.

and everyone earns the same percentages, whales only earn more in absolute terms.

The difference is in the real resources used. If energy and hardware are used, that's a real cost incurred on society. If only currency is locked up, that only puts a cost on the stakers. As far as the rest of society is concerned, the supply went down, so the value went up, and there's no difference.

The percentage is based on hardware invested or capital staked.

I don't think it should be. That is just lazily giving a pass to whales to dominate what is supposed to be decentralized. Totally counter to the spirit of cryptocurrency.

In PoS everybody gets the same rate of return. On Ethereum it's currently about 8% annualized, regardless of how much you have staked.

On Bitcoin everybody gets about the same rate of return, but major operations can generally get first access to the newest ASICs or special deals for electric power, so their rates are better.

No cryptocurrency has found a way to give the exact same rewards to every human participating. That'd require some kind of verified identity. It's always going to be a rate of return times amount invested in hardware/stake.

> No cryptocurrency has found a way to give the exact same rewards to every human participating. That'd require some kind of verified identity.

Proof of Humanity recently launched and claims to have solved this https://www.proofofhumanity.id/

That is crazy. Thanks for the link!

> Proof of stake is awarded to those with the largest stakes, which favors state-sponsored miners and works against decentralization.

Hopefully it won't be too bad. Here you can see the current involvement from different parties in the beacon chain https://beaconcha.in/charts

Currently "others" is ~52%, Kraken is 2nd with ~17%

I'm trying to understand a similar graph for Cardano (another PoS chain), but not sure I can tell anything from it about the distribution. https://cardano.bytemaniac.net/istoria/

it's also important to note that stakers can not withdraw yet. once withdrawal functionality is enabled I expect many more folks to stake their ETH because the uncertainty will be gone.

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