Doesn't this just mean the rich decide?
Please correct me if I am wrong, but that is what it sounds to me.
(And yes, I understand that POW means the 'compute-rich' decide.)
Please correct me if I am wrong, but that is what it sounds to me.
(And yes, I understand that POW means the 'compute-rich' decide.)
1: The definition of an acceptable transaction is a part of the protocol. Being a block validator or attestor doesn't let an entity change the rules of the protocol.
2: intentionally excluding transactions from the Blockchain (essentially censorship) causes economic harm to the PoS censors and is ultimately futile.
The fine article discusses both these points in more depth (mostly in the misconception section).
Essentially stake in a proof of stake system is used to punish selfish/destructive behaviours and reward honest cooperation. Participating in that system does not create a 2 tiered system of participants where one tier has powers the other doesn't not. Nonstakers simply do not aid in the production of blocks and therefore the incentive mechanisms of block production do not have any impact on them.
"The idea of CPUs, GPUs, and ASICs churning away in a mathematical competition to find hash preimages the fastest has an egalitarian elegance to it. Sovereign individuals where individuals running home gaming computers can compete with nation-states for the right to earn 6.25 freshly minted BTC.
Unfortunately, ASIC supply chains are easily controlled by import/export regulations, not to mention a dangerous dependency on Taiwan. The need for cheap, abundant energy is another weak point that prohibits individuals from running discreet mining setups. And because we have not yet entered a post-scarcity utopia, you need upfront capital to purchase mining rigs. Worse, technological advances mean miners are constantly required to upgrade their setups to remain competitive, meaning the supply chain dependency is an ongoing weak point if things ever go south.
PoW can be thought of as a specific instantiation of PoS, where users stake capital to purchase mining rigs that then compete for the block proposal rights. Your staked principal can be withdrawn at any time, but its value follows a decay curve corresponding to the current market value of your computer chips. The need for upfront capital is identical in both PoW and PoS, the key difference being that the capital is forced through a computer chip supply chain in PoW while it can be purely staked in PoS."
As of yet there are no sound methods of securing a public ledger without either PoW, PoS or PoA. Bitcoin uses PoW, most central banking and traditional payment processors use PoA, Ethereum will soon use PoS.
1. As you said, it was compute-rich before, and native token-rich now. I see it that way: the difference is that your richness is now a part of the protocol which allows it to e.g. punish bad actors (aka slashing) which isn't possible in PoW scenario where attacks can continue indefinitely.
2. Validators don't solely decide rules of execution: full nodes do. If you, as a validator, try to break the rules (double spend, incorrect execution, etc.), full nodes won't accept this new world view and discard it. So providers like Infura which most users (currently) use will continue working as expected and the canonical chain won't be damaged.
It's not that the those proposing blocks can change the rules of the game, validators are only there to ensure that rules of the game are being followed.
> ‘The law, in its majestic equality, forbids the rich as well as the poor to sleep under bridges, to beg in the streets, and to steal bread.’
Relative wealth changes because both parties need to eat and, assuming ETH becomes a usable currency, the poor will have to take a larger relative portion of their staked ETH and spend it to buy food.
Edit: Though, to be clear, this is hardly Ethereum's fault.
The empirical evidence does not suggest that capital investment is a process that is inherently inequality generating. Capital's share of income has actually declined in the G7 when you exclude housing (see Figure 3):
https://www.brookings.edu/wp-content/uploads/2016/07/2015a_r...