The answer is that it isn't, and none of these systems ever were.
They're distributed, not decentralized. And this distinction, and the refusal to acknowledge it is what put me off crypto entirely.
They're distributed, not decentralized. And this distinction, and the refusal to acknowledge it is what put me off crypto entirely.
Has a nice sound. Good job team.
I wrote it off years ago. Is it doing anything with real utility yet?
As opposed to "a bunch of dodgy rich people"
With proof of work, the same effect exists, thought it involves a loop where hashrate is exchanged for money, which is converted into more efficient hashrate at a TSMC fab.
An actor that openly attacks the network will quickly be blacklisted in either system, but when you control a majority of the money there are other ways to influence the system that don't involve breaking a formal rule.
Disclaimer: I don't have the faintest clue what I'm talking about. I only have passing familiarity with cryptocurrencies, and I've read one or two of their whitepapers.
More ETH/= more power. In my understanding, an attacker would need to control half of all staked ETH to stage a 51% attack, which would require many billions of dollars. But actually exercising this control by attacking the network would undermine the network’s security/utility, potentially sending ETH to zero and obliterating the wealth of the attacker.
This is, supposedly, a strength of PoS: the more ETH you have, the less incentive you have to attack/destroy the system.
Trying to cheat through the protocol is uninteresting. You don't destroy the system by breaking L1 rules, any such attack if successful would just get rolled back by hardfork (and nevermind the 'staked money is lost if cheating is detected' system, no one would willingly trigger it).
More ETH is automatically equal to more power, because that's exactly what money is defined to be. We trade it as power.
In such a situation, the price effect of the negative news from the attack would be partially canceled out by the jarring reduction in ETH supply.
- My money is secured by a private key and nobody can touch it ever unless they get my private key. I can simply be cautious about my private key and I know there is no other way anyone can ever get my money
- I can fill out a text box with the amount I want to send and press send
- I don't have to deal with some harebrained naming system. I can literally just send to someone's public key. This is literally how cryptography is inteded to work. It's up to _me_ how I obtain his public key.
- Monero etc exists (admittedly, not sure if it still works when someone has all the mining/stake power)
- Some guy is getting rich because he owns more miners or stake
- My password is 8 digits (this is not even an exaggeration, some of the biggest banks in my country do this)
- The bank might give all my money away if someone knows where I ate KFC last
- My money may be stolen for other reasons, because the bank wont tell me what data I need to keep private to avoid having someone transact as me
- The ID they use for authentication was also given to some 30 other e-commerce platforms and cannot be considered secure
- There is almost certainly a way to get into my account without the password
- I have to be paranoid and try to keep random trivia private such as how much I payed on an electricity bill
- I have to type codes from insecure SMS on a phone that I do not want in the first place, because the bank and all e-commerce platforms considers me an idiot and does not even give me an option to turn that shit off
- If I transfer from one country to another, my transaction may be blocked
- If I transfer some certain amount, my transfer may be blocked
- If I use a certain IP address, my transfer may be blocked
- If I transact at a certain time, my transfer may be blocked
- If I update Firefox too fast or too slow, my transfer may be blocked
- If I click buttons to fast or too slow, my transfer may be blocked
- Someone might hack my computer because it has a Big 4 web browser and the giant stack of software required to support that, instead of a hypothetical OS where people care about security and don't use C, at the cost of some microseconds.
- If I change my email address (which I don't want associated to banking in the first place) for some reason, my transfer may be blocked
- When I call the bank, I have to be polite and try to avoid saying anything suspicious (in their own mind) that will make them hold my money yet longer. I will have to supply them will all kinds of nonsense like where I ate KFC last, more ID, and a "phone password"
- My transactions may be permanently blocked and there's nothing I can do about it because the bank reps just talk to a black box "risk analysis" machine and at some point there's no way to override its decisions
- Money I receive can be "reversed" for all kinds of bogus, emotional, and/or "risk analysis" reasons
- The bank can just take my money and claim I was hacked. They have N pieces of my photo ID, address, phone number, email, and much more, and so they can choose a few people they don't like and do this to only them
- I have to interact with my bank through web pages that crash every 3 button clicks, and PDF files that may or may not render correctly (or snail mail, which is equally full of bad security)
- Some guy is getting rich because he's positioned a certain way with the bank