That's simply not true. The cost of the bitcoin miner itself is insubstantial (a small percentage of its total lifetime cost), the primary cost of mining is the commodity energy cost.
If you had a lot of capital, you could also deploy that capital completely outside of crypto, multiply it, then come back into crypto to have a larger stake in the crypto assset than you started. So your comment is true, but really applies to every freely traded economic asset.
Anyway, the mining/staking in crypto isn't primarily about increasing wealth, it is about defending the blockchain. In this aspect, there is a huge difference between the PoW and PoS. If someone has >50% of a PoS token, there is no way to usurp their control of the blockchain unless they willingly sell their tokens. With PoW, because the mining uses a different resource (energy), it is always possible to invest more capital to usurp the control of the blockchain by creating a larger hashrate. The ownership structure of the actual PoW token doesn't really matter, because outside capital can be introduced into the system.
Why would it converge when we are already starting with concentration? PoS would only work if we all started with nothing from t=0 which NO ONE in the crypto space would concede to because they don’t want to give up their wealth. So in the end, you end up with something even worse than current state of capitalism.
I'm just saying that 'staking' in proof of stake isn't materially different than taking your Bitcoin and purchasing a share of a company that mines Bitcoin. [edit] you can always un-stake by selling your share.
Staking is similar to buying lottery tickets at the store, except you need never leave your home or pay any money for the tickets. It’s all about passive income generation.
Mining is a business, with real costs and logistics to fret about.
People should really stop doing the mental gymnastics to make push-button passive income generation seem extraordinarily challenging and, even more egregious, extremely equitable (“it’s _at least_ as fair as Bitcoin”).
> how does the capital cost being mining hardware and electricity rather than a pos token make the system more equitable?
Every well known proof of stake system today was either premined, ICO’d, sold to investors in private rounds at “special” prices, or some combination of these.
Naturally, if you were autoyielding passive income by staking pos coins you had a cost basis of effectively zero in, either because you participated in an ICO, or worse, because you had the right connections, or exploited your privileged position as developer to hard code coin balances for yourself into your own ledger prior to launch, you’d _love_ proof of stake and trumpet its supposed equity and fairness in public.
In reality, the most privileged and exploitative of investors who have the lowest entry price get the highest rate of return on staking (effectively ∞ in the case of premine recipients).
To insinuate this situation is “equitable” is beyond ridiculous.
no one in this thread is promising utopia. i am merely pushing back against assertions of bitcoin being "most equitable".
late entrants add value to networks, and some of that value accrues to early entrants. this is the same for any network. a publicly accessible ico is just as equitable as someone mining btc with their cpu on low difficulty.
once the price of the token goes up, the difference between someone who was invited there early versus found their own way in does not matter to the new adopters. the inequity is felt purely based on the token price difference rather than the security mechanic.
> no one in this thread is promising utopia. i am merely pushing back against assertions of bitcoin being "most equitable".
Fairly launched proof of work systems are a great deal more equitable than PoS premined ICO coins. This is just a fact.
> a publicly accessible ico is just as equitable as someone mining btc with their cpu on low difficulty.
No, absolutely not. Obviously someone has to get the ICO money. How on earth is that “just as equitable” as anyone in the world being able to use any old Windows computer to mine coins on demand. With proof of work, money isn’t being transferred from end users to developers, or their many Swiss foundations.
the value accrues to the network (20 million to 300 billion over the last decade or so), not the dollars that went into the ico sale. the ico dollars are a rounding error.
