Comment by kybernetikos | Hacker News Reader

Comment by kybernetikos | Hacker News Reader

Public blockchain systems are distributed databases that anyone can submit write transactions to and where you don't need preauthorisation to join the system. In order to avoid the network being taken over by sybil attacks, it's necessary for participation to be based on locking up / committing / consuming something rare. Anything that becomes cheap or easy is not suitable for basing participation on.

So far I know of systems using computational work (PoW), ownership of cryptocurrency (PoS), or storage space as that rare resource. The idea of using photonics to create a low energy 'proof of time' basis is interesting but there would still be difficult economic considerations. If acquiring the photonics is too hard, then you've got a centralised system, if it's too easy then the sybil resistance and environmental impact benefit goes away (because control of the system devolves into 'who can acquire the most hardware' incentivising massive production).

Perhaps surprisingly, improving the cost efficiency of the work done by a traditional PoW blockchain doesn't reduce its energy usage, because the usage is determined by a competitive market place driven by supply & demand, not by a fixed amount of work needing to be done. Increasing the cost efficiency of the calculations just results in the blockchain doing more calculations.

A huge chunk of the cost is in the electricity used, so power efficiency and cost efficiency are very very similar. Ultimately I don't think you can improve matters much by attacking power efficiency of the calculations. You may be able to move the economic balance point between upfront/ongoing costs by requiring more or more expensive hardware, but reducing ongoing electricity usage isn't a clear win if it's produced more waste and power usage during the creation and ultimate disposal of the hardware.

One way I've come to think of it is that Sybil resistance comes from having the next block producer chosen by a raffle, with some resource used as the ticket. PoW is an example of the resource being exogenous to the system and PoS is an example of the resource being endogenous.

A problem I see with both is that they are inherently plutocratic, in that the wealthiest participants will have greater economies of scale in the resources they devote to the block production process.

This is true, however it's also not an unusual feature - pretty much every capitalist society has the characteristic that those with capital can gain more capital with a minimum of additional work.

Alternatives that don't have that feature to at least some extent would be regarded as very radical, and difficult to implement.

This has already been implemented in at least one other crypto successfully. See: Nano (formerly Raiblocks).

The crypto community, however, seems to have a very narrow focus on reproducing these plutocratic systems and incentives because everyone wants that power for themselves and wants to be first in whatever the Next Big Thing is. Crypto development as a whole seems to be hampered by these incentives and by an excessive focus on the original technologies of Bitcoin as opposed to its original aims.

I don't think it's an excessive focus on BTC technology, so much as that BTC abstracts the core issues to their fundamental essence and forces the tradeoffs on those terms, without obfuscating them. For instance, POW is extremely clear: you make a sacrifice to create blocks / mint transactions. It's almost biblical -- the game theory doesn't work without the sacrifice, and sacrifice is, tautologically, a tradeoff of one precious thing for another. All other crypto projects either want free lunch someplace, or make very different tradeoffs and assumptions.

Bitcoin is not a pure or minimal system, contrary to the hype. There are all sorts of decisions built in to it that can be varied, and if the concept of a cryptocurrency does, in fact, have society altering promise, it's very worthwhile to have other technologies explore the space.

No, I think most people (as in, core developers) just want whatever can actually be relied upon. If there were a silver bullet consensus algorithm that was decentralized and secure and also far less wasteful/plutocratic, everyone would probably switch to it.

The idea that there's an easy, superior solution on the other side's grass and bad motives are just keeping people locked into a bad system is a convenient narrative, but rarely true. I don't know the details about Nano, but my guess is the reason other cryptocurrencies haven't adopted their algorithm is because they don't think it's sufficient, for whatever reason.

Nano/Raiblocks has been around for years, the original developer was also one of the first to work on Bitcoin, apparently, and the network has been live for some years and successfully transacting.

I don’t think it’s a matter of the technology being unproven or unreliable. There was recently a 22 million dollar transaction that was both feeless and recorded to the network in <5 seconds.

It seems obvious though that to adopt the protocol means sacrificing a plutocratic winner-take-all mining regime and everyone in the crypto space wants to be that winner.

Why go through the trouble of developing a photonic mining system if there’s already a viable alternative to PoW/PoS in the real world being used? Why all these outlandish schemes to “green” PoW networks (that never come to fruition) when there’s a viable technology transacting at a literal 6 millionth of the cost of a single btc transaction?

At a certain point, you begin to see that a large part of this space is not committed to the aims they espouse but to a kind of delirious financial brinksmanship that yields little in the way of progress but makes small numbers of people very wealthy.

I'm sure there are many people who share the mentality you describe, but I don't think it applies to most core developers of cryptocurrency protocols, and such developers also don't make more money the more expensive mining is.

> Why go through the trouble of developing a photonic mining system if there’s already a viable alternative to PoW/PoS in the real world being used?

Nano has some interesting ideas but also some fairly obvious flaws, most notably the fact that there is no built-in economic incentive to run a Representative node and participate in the voting. Running a node is an expensive operation (in CPU time, memory, and bandwidth) and the protocol basically leaves this important function up to individual enthusiasm or goodwill. As a result there are a limited number of active voting nodes making decisions for the network.

The faucet-based initial distribution of Nano (XRB) is also arguably less egalitarian than Bitcoin's PoW-based mining rewards. If you weren't aware of Nano (RaiBlocks) while they were running the faucet then you had no chance to participate in that initial distribution. This is not quite as bad as full pre-mining where all the initial coins go to the developers and other may or may not be able to mine more later at a higher difficulty, but it seems likely that the developers and other early adopters would have received the majority of the output from the XRB faucet, which by design is all the XRB which will ever be produced.

From what I know of Nano, I don't believe it would work correctly under situations where it was being attacked.

I think widespread institutional adoption of crypto is pretty important in this regard.Operating a photonic miner being hard provides more incentive to be a part of those 'mining' it, as you might expect. So, if it's beyond average user scope but within say .1-1% of a companies budget and could create massive dividends, why shouldn't they invest in this?

It can be a little gross to consider, because no ones like idea of 'the rich getting richer', but that isn't really different from what happens today, anyways. What matters most is that the system has a lot of nodes to work with, and that can still happen here if there's enough adoption in this scenario.

Not to mention that it should be hard to abuse your control in a public blockchain system. Governments could require companies to have an use photonic miner operating license and revoke it if they did something like this, for example. I think its a decent middle ground between centralized and decentralized. And (should?) produce less electric waste overall. I'm not sure, I don't really know much about photonics.

Using PoW crypto at all creates massive waste for no productive use. In a world struggling to avoid catastrophic climate changes, it is completely irresponsible, and should be stopped instantly.

Not to mention, crypto currencies are worse than traditional currencies in every way: much more wasteful than the whole global banking system for a tiny tiny tiny fraction of a percentage of the number of transactions, much more centralized in several ways, deflationary, impossible to control if they spiral. There is no reason to keep this charade going.

> worse than traditional currencies in every way

Yes, they're worse in many ways, but that is exactly the design decision they made in order to be better in one particular way; to be censorship resistant (and permissionless).

Not all are deflationary; many have a tail emission that makes the supply dis-inflationary.

Nothing is censorship resistant against a determined censor. If crypto sees more and more adoption, exchanges and companies accepting it will likely get pushed to implement KYC and AML just as much as banks are.

Proof of work is wasteful in the same sense that having banks is wasteful. Imagine what it takes to operate a banking institution. It's not just electricity. It would be "efficient" to just write the word "bank" on a shack and then have one or two workers "guard" over all the deposits.

Unfortunately, nobody would be willing to use such a bank. Actual banks that people use need to spend a lot of money just on maintaining the charade of being proper custodians. Yet, they can still lose your deposit, in which case they rely on the government to bail them out.

Perhaps proof-of-stake is something that can mostly replace proof-of-work, but the proof is in the pudding.

> Actual banks that people use need to spend a lot of money just on maintaining the charade of being proper custodians. Yet, they can still lose your deposit, in which case they rely on the government to bail them out.

The major difference is that, collectively, the world's banks are a decentralized system that processes billions of times more transactions every hour than Bitcoin and other major PoW coins have ever executed, while offering many services which are impossible to offer through Bitcoin - loans, insurance, the ability to recover your money from a fraudulent transaction, and many others.

Replacing this entire centuries old system is something that no one wants - not the left, not the right, nor the vast vast majority of crypto owners, who are just in it for a quick buck.

"No office", app-only banks exists. One such bank is popular in my country.

'Impossible to control'.

Born to a generation that has lost faith in governments, this is why i have crypto.

>>Not to mention, crypto currencies are worse than traditional currencies in every way

You've never been denied financial services due to discriminatory policies, or you would not claim that.

Everything needs to migrate to the public blockchain: banking, online markets, social media platforms, etc. Giving a handful of corporations and governments control over almost every aspect of every one's lives is dangerous and corrupting.

Yes, much better to give such control to an algorithm and protocol written and controlled by a handful of engineers and mining pool owners.

And make no mistake: in a state that allows or encourages financial institutions to discriminate, you will eventually be discriminated against with Bitcoin as well. The state may not have caught up to the technology yet, but social problems can't be fixed with technology.

> social problems can't be fixed with technology.

Do you think that 'social problems can't be caused by technology'? Because if social problems can be caused by technology then surely they can solve them too.

Yes, I also think social problems can't be caused by technology. Technology is neutral - if we're using it to do harm, it's harmful. If we're using it to help, it helps.

Note that this is not 'guns don't kill people, people kill people'. Guns do kill people, so they must be regulated. The gun violence problem in the USA is not the fault of guns, it's the fault of the way US society chooses to regulate access to guns.

The protocol is publicly defined, and immutable. There is no need to trust any engineers, or give them any control, just as you don't need to trust the developers of open source software in order to trust the software.

And it is much harder for a state to ban a blockchain, than impose laws on centralized financial intermediaries that lead to rampant banking discrimination. The former will cost far more, in economic resources and political capital, to enforce.

The protocol is not immutable, and there have been several changes to it in the early days, and several proposed changes that keep being discussed (such as the famous block size limit change). If the people developing the software and the major mining groups agree on a change, who will stop them?

It is extremely hard to organize a protocol change that succeeds in tampering with existing smart contacts, let alone eliminates the permissionless/neutrality guarantees of a public blockchain with significant adoption.

For a public blockchain with as large a userbase as Ethereum, a protocol change that nullifies its neutrality and permissionless-ness would be nearly impossible for any group to push through.

It's absolutely incomparable to traditional banks, with respect to the degree of resistance to interference from governments.

If we want to bring climate change under control then coordination and communication tools that cross national borders are necessary. That is what many of us working in crypto are focused on, you might not yet value it, but we do.

How do we collectively, as a planet, decide what is acceptable usage of energy and what isn't? Who gets to use machines and who doesn't? And how do we do that in a way that isn't authoritarian, and held together with violence?

Is it wrong to use my gpu playing video games all day, or is the moral panic only applying to certain uses of computers?

When you say it should be stopped instantly you should clarify what you mean by that, what action do you see being taken?

If every person on the planet were using their GPU to play a few hours every day, they would probably not reach the amount of energy used by the Bitcoin blockchain alone.

All of the things you are citing require cooperation and discussion and democratic discourse. An algorithmically driven opaque protocol controlled by a handful of technocrats (the people developing the major clients and the ones running the major mining pools) is part of the problem, not a model for the solution.

Not to mention, money as a means of exchange is simply not one of the problems standing in the way of stopping global warming. The biggest problems are caused by rich people who have calculated that they will not be personally impacted, who couldn't care less about the poor 90+% of the planet who will, and who have thus decided to prioritize increasing their wealth today over any sort of urgent changes. It is also perpetuated by organizational systems put in place a long time ago (mainly for profit corporations with lobbying power) that have the same goals - short term profit over any other consideration.

Another thing that was put in place for corporations with lobbying power and wealthy people is the current US monetary policy of quantitative easing to infinity. This makes the rich richer and decimates the purchasing power of those who have few assets (poor and/or working class), and the government which you seem to have so much trust in does this knowingly. Note that even outside of the US, this does matter, since the USD is the de facto global reserve currency.

I do not have that much trust in the government. However, the government, unlike corporations or algorithms, is the one thing I have some minute amount of democratic control over, corrupt though it is. Moving things like monetary policy away from corrupt government control directly into private hands, or moving it into completely inflexible algorithmic control (with the algorithm in turn controlled by private individuals) can only make things worse.

And note that, while QE is useful to the rich, it also permits things like giant infrastructure bills that help everyone. We've seen in Greece what can happen when money supply is constrained (in that case, by EU policy preventing one country from just printing euros), and it's definitely not the rich who lost. QE is being used to serve the rich not because it's inherently in their benefit, but because almost everything in our society is being used to help the rich.

>Is it wrong to use my gpu playing video games all day, or is the moral panic only applying to certain uses of computers?

Is it wrong for you to leave a warehouse full of computers idling to play a computer game? Yes. This is one of the more outrageous false equivalences I've seen.

It stops being a moral panic when crypto consumes more electricity than the entire nation of Argentina.

“crypto consumes more electricity than country X” is such a tired and low-effort talking point. There are things more useless than crypto that consume more energy than certain countries.

This isn't actually true at all. Climate problems are caused by competition between governments and their pursue for growth, which forces everyone to consume and produce more than is necessary. Under the current economic system, natural catastrophe is inevitable. Bitcoin actually fixes this, because it makes it impossible for governments to enforce growth through money supply manipulation, which they have to do to compete with each other.

The current economic system is compatible with a carbon neutral world. We managed to ban all kinds of destructive things that provide (short-term) economic benefits without changing our economic system.

> ownership of cryptocurrency (PoS)

The problem is that PoS commitment isn’t binding. You can always stake your money, then if you don’t like the outcome, you can just pretend the first stake never happened and do it again. Cf “grinding” attack. PoW is unique in that any claimed commitment corresponds to a real, physical, irrevertable commitment.

> or storage space as that rare resource.

Every storage coin so far has been some sort of DINO scam. The most interesting one is Chia but it’s absurdly complicated, and I think that complication might mask some centralization/vulnerability. For example, the reliance on “time lord” nodes strikes me as very questionable.

What's a DINO scam? Couldn't google anything relevant.

DINO stands for “decentralized in name only”, which refers to the shockingly common case of a crypto-thing advertising itself as decentralized when in fact it is controlled by a single entity or cartel.

> Ultimately I don't think you can improve matters much by attacking power efficiency of the calculations.

citation

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