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Comment by Entwickler | Hacker News Reader

From https://vitalik.ca/general/2020/09/11/coordination.html "A large mining pool publicly showing how they have internally distributed their nodes and network dependencies doesn't do much to calm community members scared of mining centralization. And pictures like these, showing 90% of Bitcoin hashpower at the time being capable of showing up to the same conference panel, do quite a bit to scare people".

If you follow the link, you'll see a picture of 7 people that controlled 90% of Bitcoin hashpower at the time. Remind me how that's more fair to an arbitrary holder of Bitcoin, than say, letting the holders have the power with staking?

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Or, for that matter, leaving fiscal matters in the hands of a central bank with a board of governors appointed by democratically elected officials?

Honestly, I don't see how the status quo in crypto actually improves on that at all (unless you are in the ransomware business, of course. Then it makes sense.)

You could try auditing central banks, see how long you can remain alive. Bitcoin is an open ledger that can be audited by anyone. That alone is a significant improvement.

It is also the closest thing we have in practice to the "Ideal money" proposal by Nash, that Nash spent 20 years giving lectures about around the world.

Nash's notes and slides on that: http://web.math.princeton.edu/jfnj/texts_and_graphics/Main.C...

The improvement of status quo is quite obvious. Bitcoin is a potential solution to the Triffin's dilemma.

This is something of the scale that can alter the course of history and impact every country on Earth.

> Or, for that matter, leaving fiscal matters in the hands of a central bank with a board of governors appointed by democratically elected officials?

Money shouldn't be democratic. I'm not OK with a majority deciding that they're entitled to my money.

More generally, private property is a good thing. I don't want majority vote to decide whether I can keep the house or car that I own.

How would you pay for infrastructure?

I see nothing wrong with taxes. I just don’t think a monetary unit managed by politicians works in the long run.

But the power to set monetary policy is just a restricted version of the power to tax. Creating money is effectively a tax on savings. So why are you OK with taxes in general, but not this very restricted tax?

> Creating money is effectively a tax on savings.

No, it’s much more than that. For example, by creating money, and using it to buy bonds, you can push down the rate of interest. This has nothing to do with taxes. It’s an interference with market coordination, because interest rates play a central part in this.

For example, let’s say you have a business worth one billion dollars, and you earn 50 million dollars in profit per year (a 5% yield per annum). By setting the Federal Funds rate at 6%, the government can make it profitable to sell this business and deposit the proceeds in a bank account, hereby earning one percentage point more in yearly returns.

The government shouldn’t have the power to halt economic activity in this manner, because it amounts to central planning, ie. communism. Which has been proven to be a disaster.

> by creating money, and using it to buy bonds, you can push down the rate of interest. This has nothing to do with taxes

Of course it does. It's all just wealth redistribution. Lowering interest rates redistributes wealth from lenders to borrowers, i.e. from savers to debtors.

> By setting the Federal Funds rate at 6%, the government can make it profitable to sell this business

The government can do exactly the same thing with tax policy. The only difference is that tax policy is more flexible (because it has many degrees of freedom rather than just one) and hence more powerful. The power to control the money supply is a proper subset of the power to tax. You can't support the latter but not the former and remain logically consistent.

They have very little power.

All they can do is refuse to work. Anyone can do that. They cannot force any new changes on you. Proven in forkwars with billions at stake.

PoS have not yet had such a test.

This difference is that in PoS, if anyone ever holds more than ⅓ of the total supply (as is the case with Ethereum's founders currently holding 65% of the overall issuance, for example), they can indefinitely control the chain through their re-org capability.

I don't have a reference but rumours have it Joe Lubin alone controls close to 10%, which would be close to 50 billion today.

With the usually apathetic voters/stakers, one such loud voice can sway a PoS network easily.

"With the usually apathetic voters/stakers"

What makes you think eth stakers are apathetic?

all experiments with onchain voting seem to have that problem, just like with voting in real life.

read up on the DAO exploit and carbon vote. Even in a drastic situation turnout was low.

It's a permissionless industry and I suppose people can try different things, but one thing that sets apart Bitcoin from everything else - it is not a democracry.

Democracy was designed for cities of 50-60k in size, where only rich landowners got to vote and everyone else was basically peons. It doesn't scale and is not particularly great.

PoS is just another string of boneheaded attempts to make democracy great again...by marrying it with plutocracy? idk.

Would you care to vote with your measly stake if you know the insiders have over 50% anyway?

"the insiders have over 50% anyway?" This is false. Hard to take the rest of your premise seriously when they are not based on facts and sound more like maximalism.

That's a hypothetical conjecture.

In any distribution, the small number of players usually controls most of the wealth, as we've seen throughout the history.

What are the odds it will not be a handful people, coordinating their interest vs everyone else? That's inevitable.

There's ~100m eth so your numbers are way off. I have a sneaky suspicion you don't really know what you are talking about.

Like i said, it's just a rumour, but from a fairly informed source.

Do you have a better estimate?

Total amount of fundraising ETH did initially was about 20 mil? 1-2 mil sounds like a feasible early VC check to get 10%, not including games you can play later to increase your stack further.

10% with the current market cap would put him among the top 10 richest people in the world... I highly doubt these numbers are accurate.

Could you: 1. Point me to the source that says, " if anyone ever holds more than ⅓ of the total supply (as is the case with Ethereum's founders currently holding 65% of the overall issuance, for example), they can indefinitely control the chain through their re-org capability." 2. Point me to the addresses of Ethereum's founders? Presumably it's then 65% of 115 million eth.

Would honestly love to see the details.

Apparently Vitalik has 333,000 ETH https://www.forbes.com/sites/michaeldelcastillo/2021/01/11/b.... Which would be 0.29% of the 115 million current supply.

I guess Joe has the other 64.71%, or perhaps there are a whole bunch of other founders that I'm unaware of...

It’s probably for ethereum 2, which is PoS.

The total amount of ETH held by addresses doesn't change when going from ETH to ETH 2.0.

In addition to miners, running actual Bitcoin nodes keeps the network safe, that's why it's very important for it to be very cheap to run so that many people/volunteers can do it.

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