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    This post presents quite a distorted picture. For instance,

    Proof-of-stake is a bit too obviously “thems what has, gets”…

    You need some way to qualify transaction validators. Bitcoin has demonstrated that economic commitment is a valid qualifier. It’s sensible to experiment with other forms of economic commitment, because as you point out, PoW is increasingly harmful as the network value grows. Has there ever been a resource allocation system where the allocators were not “them what has” in some sense, and no economic advantage accrued to them? At least in a cryptocurrency, this only applies to the validators, and the economic advantage is explicit, transparent, and accountable.

    — so you have to convince the users to go along with it.

    So, a completely voluntary system… Quite alien, compared to previous financial systems, but I kind of like that aspect.

    It’s also as naturally centralising as proof-of-work, if not more so.

    I’m not sure what you’re referring to here.

    The other problem is that people routinely spend up to $99.99 to get $100 — thus, proof-of-stake will rapidly approximate proof-of-work.

    That link describes stake grinding, and the long-since identified solution is described in the FAQ you link elsewhere in the post.

    There’s a lot of similar distortions throughout the post, but it doesn’t seem worthwhile to point them out, since they are so blatant and the overall tone is so hostile and dismissive that I suspect most of them are deliberate propaganda.

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      There’s a lot of similar distortions throughout the post, but it doesn’t seem worthwhile to point them out, since they are so blatant and the overall tone is so hostile and dismissive that I suspect most of them are deliberate propaganda.

      It would be worthwhile to point them out nonetheless, OP is not the only person reading these comments.

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        So, a completely voluntary system… Quite alien, compared to previous financial systems, but I kind of like that aspect.

        I’m speaking in terms of convincing people the system is fair enough to bother participating in. As the rest of the post details, “number go up” has so far been sufficient.

        Remember: the market doesn’t care about your ideology, only its own.

        That link describes stake grinding

        No, it’s general to economics. If there’s any way to spend toward even the slightest profit in any enterprise, someone will think that’s a viable business. An entry in a FAQ doesn’t make that go away.

        There’s a lot of similar distortions

        By “distorted picture “ and “distortions” I’m pretty sure you mean “doesn’t agree with me”. “Distortions” is what a believer says when they can’t quite support “incorrect”, let alone “meaningfully incorrect.”

        I suspect most of them are deliberate propaganda.

        If more than a negligible proportion of the populace agreed with you, then their interest in cryptocurrency would be greater than “number go up” and interest wouldn’t have gone away with the bubble. Jumping to conspiracy theories is unlikely to get you anywhere useful.

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          If there’s any way to spend toward even the slightest profit in any enterprise, someone will think that’s a viable business. An entry in a FAQ doesn’t make that go away.

          There isn’t any such way in a well-designed proof-of-stake system. The FAQ explains this, as you would see if you read it with care. Such systems are described in detail in the Ouroboros Praos and Algorand papers. (I’m sure Casper has a similarly detailed specification, I’m just not as familiar with it.)

          By “distorted picture “ and “distortions” I’m pretty sure you mean “doesn’t agree with me”.

          No. You could convince me otherwise by making a cogent response to my initial objections.

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            There isn’t any such way in a well-designed proof-of-stake system.

            Has any such system been deployed in the real world, and tested with real users? Plans have an unfortunate tendency not to survive contact with the enemy.

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              Nothing big, yet, and caution about such plans is sensible. But that’s a long way from claiming proof-of-stake is fundamentally broken for transparent economic reasons.

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                No, but there is no evidence such PoS system is impossible in principle. Saying, like David Gerard, it’s an axiom of general economics, is like saying it’s profitable to break public key cryptography, therefore all public key cryptography will be broken.

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                  Gerard says no such thing. The entire point of the article is that Casper is soon here, and it will probably work as designed.

                  You are deliberately misquoting a comment regarding a specific argument against PoS, namely stake grinding.

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                    That link describes stake grinding

                    No, it’s general to economics. If there’s any way to spend toward even the slightest profit in any enterprise, someone will think that’s a viable business.

                    Since I’d already pointed out that stake grinding is no longer an issue, the only sensible way to interpret this is that Paul’s general economic arguments had some independent relevance.

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                      We shall see. I am very interested to see how Casper turns out when it’s exposed to the real world.

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                        What shall we see?

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                          Whether Casper enabled Ethereum to make a successful transition from Proof-of-work to Proof-of-stake!

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                            We will also see whether “PoS will rapidly approximate PoW”. My current opinion is that it is possible, but unlikely.

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              To respond to your subsequent edit:

              If more than a negligible proportion of the populace agreed with you

              A negligible proportion of the populace has read your post, and their opinion has no impact on its accuracy.

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              Your link doesn’t make a claim, it’s just a link to a Twitter search saying proof of work is good. Did you mean another link?

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                  So you did, sorry!

                  One link compares, literally, the entire financial system and everything it does to Bitcoin, and asserts - without numbers - that surely Bitcoin is more energy efficient than the existing system. (The other links are blank slogans.)

                  Since you can’t be bothered making an effort post, I will:

                  In 2015, there were approximately 430 billion cashless transactions.

                  The world produced about 24,000 TWh of energy in 2015 - oil, gas, coal, renewables, the lot.

                  If Bitcoin handled all of those transactions at 215 kWh per transaction, that’d be about 10,000 TWh - or about 40% of all the energy in the world.

                  Does the existing financial infrastructure consume close to 40% of all energy? I strongly suspect it doesn’t.

                  Those numbers are, of course, fuzzy as hell. Feel free to post better ones, or indeed any.

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                      And you’re being rude. Please either engage positively or don’t post at all.

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                A bunch of Twitter links do not an argument make.

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                  You’d have done better just highlighting the one link that makes your points best. That’s this one. It actually has good points if we’re comparing Bitcoin to the existing financial system. It’s misleading, though, given it counts every card or chip used in the main financial system… tiny, cheap things… without counting all the devices that would be necessary to securely do Bitcoin. I bet the computers or embedded devices Bitcoin users use cost more to make than smartcards with 16-bit MCU’s connecting to standard servers over secure tunnel.

                  The no branch and cash advantages do exist against most banks. Your comparison leaves off those where they don’t: branchless banks (i.e. online banks) or digital payment systems (i.e. Venmo or Paypal). Unlike the cryptocurrencies, those centralized alternatives grabbed plenty of the bankers’ market with one becoming a transforming force when partnering with eBay. PayPal achieved its goals by fixing real problems people had with the financial system using easiest methods possible reusing what was already proven to work. That’s what alternatives should be doing. The cryptocurrencies seem to only look much better in performance and energy usage if compared to the most inefficient, wasteful models in centralized finance. Compared to the digital ones (esp lean ones), they don’t have strong advantages for most users: only disadvantages like slower transactions, more energy use, more costly computers, riskier protocols due to higher complexity, lower longevity, and unclear risk on disputes if it hits a court.

                  (@David_Gerard, you might find this last one useful later.)

                  I’m saving the best part about your comparison for last: it should be an AND instead of an OR. It’s totally wrong to compare them in isolation. Bitcoin is a failed currency primarily used for speculation with intent to get someone richer in an existing currency (i.e. the financial system). It and most cryptocurrencies also use the existing financial system for investments into them, payments, the devices they run with, their energy use, cash backing of some assets, conferences/meetups, and probably your personal account on Patreon. The crypocurrencies are using the current financial system to bootstrap their vision of the future (or just defraud people… it varies). Until a transition happens, crypocurrencies need their energy use and the existing financial system’s energy use. They combine. It’s not one or the other until cryptocurrency users or developers are no longer using the financial system. That is quite a long shot even harder to believe than crypocurrencies going mainstream to begin with.

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                    thank you! I have a lengthy effortpost in the works on proof-of-work and the bad excuses for it, and will definitely be noting that point :-)

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                        I just pointed out your link was spreading disinfo given it pretended Bitcoin operated in isolation instead of with the financial system. It’s a wasteful system that depends on and adds to everything you mentioned. It can only be said to use less energy if it’s self-sustaining and eliminated the other stuff by replacing it in the large. Instead, most Bitcoin use is happening side-by-side with it sustaining both systems. They add together.

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                            If it’s not true, then at least the following would be true:

                            1. All personnel and hardware involved in Bitcoin are paid for only in Bitcoin. That’s development, mining, promotion, meetings, etc. It has replaced the financial system for at least its own needs among its own supporters.

                            2. People move money into Bitcoin. It then stays there since the use Bitcoin as a currency. Most aren’t moving things into and out of the financial system to profit off of Bitcoin. It would just be a financial instrument in the regular, financial system being used like many others. It’s also fairly stable so your money isn’t here today and gone tomorrow.

                            3. Bitcoin isn’t backed by physical cash at any level. You’d need the banks, Brinks, Fort Knox, etc at that point behind the scenes. Bitcoin could still vastly reduce amount of that but still depends on some of it. Hasn’t eliminated it.

                            If any of these aren’t true, then Bitcoin is using the current, financial system to operate because it hasn’t replaced it or eliminated need for it. If No 1 is true, that’s especially interesting given they’re the people who say it will replace the current financial system. If it hasn’t for them, then why should rest of us depend on it?