The difference is that PoW is censorship resistant. Anybody can be a miner and existing miners cannot censor new miners. Performing new work is external to the network state. In PoS, existing stakers can prevent new stakers from registering. Very important distinction.
Its not really though, if the majority of PoW miners want to omit a certain miners blocks, they can. The protocol dictates that the chain created by the majority of mining power is the canonical one.
In the event that a censored party can create a heavier chain (has >50% of the mining power) then the argument that its more censorship resistant holds, but on the PoS side, you would be betting that not a single participant in the main chain included their new stake registration in their blocks. This is different than the PoW model as non-malicious nodes in PoW can still be part of the main chain. It's definitely not that cut and dry
There are a few distinctions:
1. In PoS you actually never know who mined a given block with certainty. You can mine anonymously making censorship pretty difficult. This is not the case in PoS.
2. In PoW miners risk losing money by not building off the block found by a miner they're trying to censor. There is a cost to losing. This isn't the case in PoS (for the most part), as long as they don't double stake.
3. Additionally, the key distinguisher is that miners and custodians (almost all US based and controlled by VC funds) are two very distinct groups in Bitcoin. In a PoS currency they are the same group. That results in a power consolidation that effectively makes a PoS currency completely controlled by a few silicon valley insiders and eventually the US government.
I think you made a typo in your point #1, as you said something is the case of PoS, and then contrasted it with PoS, saying “This is not the case in PoS”. I suspect the first PoS was meant to say PoW.
Correcting that is the main point of this comment, the rest is just a side note.
I don’t really understand your point #2, but this very well may be because I don’t understand the proposed protocol.
You say “as long as they don’t double stake”, but if a given block is expected to probably be in the consensus chain, then either they don’t endorse it or whatever, not putting their stake behind it, and therefore, I would think whatever they do put their stake behind, if the block-to-be-censored is included in the long-run consensus, then what they backed isn’t, and so they get no reward, and so they lost out on potential reward, or, if they try to support multiple things, they lose (some fraction of) their stake.
Uh, unless they can be rewarded for supporting a block that is parallel to the block-to-censor even though the block-to-censor gets in? But that doesn’t seem right. I suppose there are uncle blocks maybe (idk if that is part of Ethereum’s planned PoS system or just its current system), but those have a substantially lower reward, so deliberately producing probably-uncles would still involve giving up rewards on average.
> Its not really though, if the majority of PoW miners want to omit a certain miners blocks, they can.
Censored transactions can hire/pay miners who won't censor more transaction fees, to encourage them to include the transactions in a block. In other words, since transactors pay miners, transactors are customers of miners.
There is an open market competition– any miner censoring transactions will lose higher fees from people who send censored transactions.
Its the other way round -- nothing forces nodes to accept bad blocks from miners. An honest node would simply ignore the bad data. The exchanges run nodes, so I would rather be generating or receiving transactions on a chain (or fork) that its users are engaging with. Nodes accept blocks from miners, miners don't accept blocks from nodes.
Isn’t there an incentive to run a node for privacy? With your own node you are not leaking your xpub and you don’t leak your transactions by staring at them on a block explorer
Wouldn't your own node unless properly hidden be higher chance of leaking your transactions? As I would expect them to come from your own node... Ofc, tracking the ones made from other services sure it is safer.
>Fantasy. Nothing forces miners to accept transactions sent by nodes attempting to enforce some rule.
I deleted a previous reply to you because I think I may have misunderstood what you wrote. In any case, are you saying the majority of miners have the ultimate control of the protocol rules of the cryptocurrency?
Not in principle, but I do believe this to be the case for Bitcoin specifically. Network majority is distinct from minor majority, but obviously miner (or stakeholder) majority is an extremely important part of it.
>Not in principle, but I do believe this to be the case for Bitcoin specifically. Network majority is distinct from minor majority, but obviously miner (or stakeholder) majority is an extremely important part of it.
In 2017, the majority of miner hashpower wanted to change the Bitcoin protocol to increase 1MB blocksize to 2MB but the SegWit2x failed to be adopted. What's your interpretation of that event?
They signaled support for it, but when push came to shove, they bailed.
I'm not saying 51% of miners decide what the rules are. Suppose you had a Bitcoin fork that had 80% of the hashrate. How long would that situation need to persist until the major network participants decide to call that fork "Bitcoin"?
