Cardano founder Charles Hoskinson spoke with Blockstream CEO Adam Back on the centralization of the leading distributed consensus mechanisms in the cryptocurrency industry.
plutocrats appear in favor of PoS digital plutocracy. who'd have thought!
I think two pizzas could feed the owners of this pie chart. But please tell me more stories about the evil PoS plutocrats
Adam Back noted that proof of stake is inherently very rich, as decisions are made based on the number of tokens shareholders hold. Rules and upgrades of a particular blockchain protocol are made primarily by the wealthiest participants, thus creating oligopolistic cryptocurrency systems.
The head of Blockstream, a prolific Bitcoin maximalist, has made a lot of noise about the alleged flaws of proof-of-stake monetary and governance models. Back in 2020, proof of stake replicated the "worst aspects" of government-controlled fiat.
"Proof of Stake has fundamental problems. And even it it were magically repairable, it would be undesirable, replicating the worst aspects of the fiat political money state. PoW > PoS"
In contrast, Hoskinson aimed to decentralize Bitcoin mining by adding a pie chart highlighting the fact that only a handful of mining pools control the entire network.
In a separate tweet, Hoskinson said that individual miners are lacking due to the proliferation of highly complex equipment and the emergence of a highly professionalized multibillion dollar business.
Some critics believe that Bitcoin has deviated from what it should be due to such an unhealthy level of centralization. In 2018, Bitmain-controlled mining pools took control of around 51% of the Bitcoin hash rate, making them worryingly close to potentially coordinating to attack the network.
Bitcoin users tend to dismiss such concerns by arguing that mining should not be widely distributed because it is too costly to attack Bitcoin.