In fact, arguably PoW is worse, because it has economies of scale that PoS does not have, so the rich truly do have an edge in PoW.
PoW requires constant investment or you'll be left behind.
They shouldn't, what Bitcoin is enabling is the ability for whoever to use whatever kind of coin they want. Bitcoin opened the whole pandoras box where anyone can create their own coin if they want.
However, for each crypto coin there is clear incentive to make the coin more useful in transactions, both for those more well off and for those less fortunate. Typical BTC holder wants to make BTC useful for everyone, because that adds value for their holdings. That usefulness might add value to those less well-off. If not, they can use something else - in the end there is more choice in the marketplace which should (in theory) benefit everyone.
From what I've seen, the main purpose of like 90+% of altcoins is to benefit their developers and investors and they'll likely all die and disappear.
Just taking a stab at it, maybe bc we haven't come up with a notion of how a viable crypto-coin could be started by the least well off, who are -by definition- at a competitive disadvantage in launching successful projects.
I'm not saying it's an impossible problem, just that these systems tend to be driven by economies of scale, whether it's new/disruptive, or the product of an older, more established regime.
And to be clear, I am not suggesting this with the finality of a foregone conclusion, but merely thinking aloud about the dynamic of the underlying problem.
And that is great news for crypto holders, cause that means PoS rewards can be way smaller than PoW rewards, which means less devaluation of existing coins and lower transaction fees!
Staking is not all that profitable, really. The rich get richer at a rate which is comparable to a Vanguard ETF but the price volatility is much higher than a Vanguard ETF.
Staking coins just means clicking a button and receiving a financial yield proportionate to your initial investment. Simply showing up with money on day one is enough to earn money on your money.
People financially invested in staking frequently pretend like button-clicking auto-yield is the exact same thing as A) procuring powerful computers which rapidly become obsolete year after year, and B) paying for electricity and hosting facilities for those computers over a long period of time. But the difference between the two scenarios is night and day, and no amount of waxing poetic over “commerce favoring the well-funded” will change that fact.
To act as if staking has exactly the same economic properties as mining is false equivalence.
When rich, with POS, you need to do nothing at all. No investment, no risk, no competition, you can just park your money and tap new money.
With PoS, you do nothing except maintain your staking hardware and burn the time value of the money you are staking.
From that perspective there is no difference. The difference is that with PoW, the richest participants can afford the most efficient hardware, giving them a super-linear advantage. In PoS, it's still true that the "rich get richer", but only at a linear rate, since there is no way to improve the efficiency of staking (which is basically the best you could ask for).
It is like, imagine if USA had written in the constitution that the rich should get richer? Would you defend that move by saying "Well, the rich gets better investments anyway so this wont make a difference!".
It is a "fundamental law" in both PoW and PoS that you get rewarded for doing the work/staking. I don't really understand your point about the US constitution -- what I am saying is that PoS systems minimize the effect of the "rich getting richer" as much as possible by forcing it to be at most a linear effect. Whereas there is no need to include such language in the US constitution at all.
If I invest in Bitcoin and its price increased by 10%, I did not lose money if it turned out that real estate would have gained by 20%. I still gained 10%. Actually, only if I sold it.
That's not "losing money", it's not maximizing returns.
Further, you're still missing the double effect of staking. With staking your portfolio value will depend on the price of the token, yet since you staked it (it's locked up), it's a paper win/loss. Further, regardless of that, you get NEW coins for free.
Further, it's not linear at all. It's whatever the token does, which can be linear, parabolic, anything.
You are right that you wouldn't normally consider alternate investments like that. But with PoS, where the only cost is the time value of the money staked, it is the only thing to compare.
If you reason like that, I suppose in your world fireworks is the same thing as a rocket bringing us to Mars?
Is running Amazon and making a profit the same thing as just milking interest from a bank account?
These differences aren't trivial, they are massive. In a PoW world, most rich people don't mine, they just hold the crypto. In a PoS world, said rich people auto-mine by just holding crypto.
No, what I am really saying is that PoW mining and PoS staking aren't so dramatically different in complexity like you are saying. They are actually both complicated businesses with variable yields. The only difference is that with PoW, the benchmark is electricity cost, whereas with PoS the benchmark is the other investments which you could have invested your staking money into.
When’s the last time a billion dollar staking operation had to build multiple mining datacenters and fill them with hundreds of millions of dollars worth of hardware? That’s just not required for staking. It just isn’t. They’re not equivalent operations. Not in any way. Not by any stretch of the imagination.
Which of these two scenarios seems to favour the rich, in your mind?
There’s really no comparison. Running a business with high fixed and variable costs, and considerable competition is far more difficult to pull off successfully than a passive investment. Which one do you think favours a “gilded elite” more?
Putting money in a bank isn't even enough to keep up with inflation at the moment, the same is true for Proof of Stake coins, too.
I would say it’s harder to compete with miners than stakers.