Author Topic: Profits, Performance, Trust & Efficiency  (Read 32576 times)

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Offline bytemaster

Re: Profits, Performance, Trust & Efficiency
« Reply #30 on: March 28, 2014, 05:00:43 pm »
With proof of stake your private key is your proof.   


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Offline jae208

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Re: Profits, Performance, Trust & Efficiency
« Reply #31 on: March 28, 2014, 05:01:31 pm »
I'd prefer to trust in my ability to protect my private key than to trust a trustee. A digital company shouldn't require any voting or representatives to vote on behalf of shareholders. Otherwise it defeats the purpose of calling it a DAC because it is no longer autonomous in the slightest sense because instead of the code taking care of that now we have to rely on people.
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Offline Stan

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Re: Profits, Performance, Trust & Efficiency
« Reply #32 on: March 28, 2014, 05:26:35 pm »
If it isn't sufficiently efficient from the get go, the door to competition who will find a way to make it efficiently efficient will be wide open. I don't like the idea of centralizing this at all, but I also figure bytemaster is bringing this to us now because there isn't another viable way at the moment that won't cause other headaches or delays in getting BTS launched.

As this subject is very 'touchy' I do want to let everyone know that I am a firm believer in decentralizing POWER.   I am also committed to finding solutions that eliminate single points of failure.   I also recognize that decentralization brings its own security concerns.

1) All of the random selection techniques discussed here (and with Nxt) depend upon people putting their private keys at risk.  So rather than trusting a trustee, everyone has to trust their computer not to get hacked.   
2) All of the random selection (mining + POS / etc ) techniques have potential for forks (even if just for a few blocks) and this potential is highly problematic.
3) Everything in life is about tradeoffs.... so lets focus on decentralizing power in the most efficient manner.

Identify the failure modes in the various systems and you will conclude:
1) Trustee model is more decentralized than Ripple because the Trustee has less power than Ripple's inner nodes have.
2) Mining results in a kind of centralization and de-facto trustee that cannot be fired
3) POS requires peoples keys to be kept on line and ultimately a minority of nodes will participate in block generation

I don't think there is any gray area when it comes to decentralization. Either you are, or you are not. There is no partial compromise.  Since most people will be operating within the borders of existing government laws, true decentralization wil never be achieved. You must do what you think is best.

The way I would put it is:  "Decentralization is a philosophy and a powerful tool, not the automatic answer to every design question."   :)
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Offline santaclause102

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Re: Profits, Performance, Trust & Efficiency
« Reply #33 on: March 28, 2014, 05:44:12 pm »
Assumptions:
With the shares system we have an easy way to vote on anything.
With the TaPOS system the transaction ledger becomes immutable automatically over time as the ledger is confirmed by everyone on the network.
Generating the next block should be as efficient as possible to maximize dividends.
Transaction validation should be as quick as possible.

Solution:
Shareholders vote (off chain) on a trustee.
Trustee generates blocks every 30 seconds (or at will..... no need to require any particular rate)
If trustee is compromised or shutdown, shareholders can elect a new trustee by broadcasting their vote.
Once a new trustee has 51% of the shareholders support the network continues.

As a trustee you cannot double spend (you will be caught and fired).
As a trustee you cannot perform Denial of Service without being caught and fired.
As a trustee you cannot be coerced without being let go.

As a shareholder this maximizes your value (dividends, transaction speed, no potential of forks).

A trustee is not a paid position and requires almost no resources to run.  A trustee could even operate behind a tor node.

The result is like a 'constitutional company' where the laws are entirely defined in the constitution and the 'president' can be recalled at any time and has almost no power even when in office.

This same process can be used to resolve when a hard fork goes into effect.   

Thoughts?

Does this have the potential to delay the release of ME/XTS/Lotto/DNS .? I assumed the end of March for the first DAC (ME) to be released...  :o
« Last Edit: March 28, 2014, 06:34:32 pm by delulo »

Offline santaclause102

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Re: Profits, Performance, Trust & Efficiency
« Reply #34 on: March 28, 2014, 05:46:02 pm »
With proof of stake your private key is your proof.   


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Do you mean private keys have to be risked with POS (forging) because they can not be used for forging when they are in cold storage?

Offline wasthatawolf

Re: Profits, Performance, Trust & Efficiency
« Reply #35 on: March 28, 2014, 05:53:02 pm »
2) Mining results in a kind of centralization and de-facto trustee that cannot be fired

This is misleading.  With this comparison, there would only be a singular "de-facto trustee" if someone controls 51% of the network.  Otherwise the "de-facto trustee" is the collective group of miners.  If you're referring to the pool operators as the "de-facto trustee" that assumes that they control the net mining power of their pool.  We've already seen with bitcoin that when pools get too big, people will stop mining within them.

With a trustee, you're talking about centralizing control, hiding it behind a Tor node, and leaving it up to the shareholders to fire the trustee if they think they're acting to harm the network.  How would you even elect a trustee in the first place?  Campaigning?

Offline toast

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Re: Profits, Performance, Trust & Efficiency
« Reply #36 on: March 28, 2014, 05:55:23 pm »
With proof of stake your private key is your proof.   


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Do you mean private keys have to be risked with POS (forging) because they can not be used for forging when they are in cold storage?

They don't if you can sign for a delegate! Keep 90% in cold storage and have your 10% hot wallet sign for all of them. You could easily have revocation keys so you wouldn't have to take your shares out of cold storage to take away the voting power if your hot wallet is swiped.
Do not use this post as information for making any important decisions. The only agreements I ever make are informal and non-binding. Take the same precautions as when dealing with a compromised account, scammer, sockpuppet, etc.

Offline puppies

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Re: Profits, Performance, Trust & Efficiency
« Reply #37 on: March 28, 2014, 06:14:50 pm »
With proof of stake your private key is your proof.   


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Do you mean private keys have to be risked with POS (forging) because they can not be used for forging when they are in cold storage?

They don't if you can sign for a delegate! Keep 90% in cold storage and have your 10% hot wallet sign for all of them. You could easily have revocation keys so you wouldn't have to take your shares out of cold storage to take away the voting power if your hot wallet is swiped.

I was thinking something similar.  Why couldn't you link your address to another address that has zero coins assigned to it.  You could then put your real wallet into cold storage and the empty wallet could provide security through POS.  If someone hacks my PC they would only get my voting power, and only until I pulled my wallet out of cold storage and used it to sign a new block with a new link.  Am I making sense?  Could this work?
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Offline phoenix

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Re: Profits, Performance, Trust & Efficiency
« Reply #38 on: March 28, 2014, 06:29:47 pm »
I feel like with TaPOS you need a lot of people to keep their keys online to secure the network, but then they might be hacked and lose their shares. With a trustee, you need enough people to be interested in voting to achieve that 51% threshold, and you need a way to determine who everyone is voting for that risks as little as possible.
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Offline toast

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Re: Profits, Performance, Trust & Efficiency
« Reply #39 on: March 28, 2014, 06:46:17 pm »
With proof of stake your private key is your proof.   


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Do you mean private keys have to be risked with POS (forging) because they can not be used for forging when they are in cold storage?

They don't if you can sign for a delegate! Keep 90% in cold storage and have your 10% hot wallet sign for all of them. You could easily have revocation keys so you wouldn't have to take your shares out of cold storage to take away the voting power if your hot wallet is swiped.

I was thinking something similar.  Why couldn't you link your address to another address that has zero coins assigned to it.  You could then put your real wallet into cold storage and the empty wallet could provide security through POS.  If someone hacks my PC they would only get my voting power, and only until I pulled my wallet out of cold storage and used it to sign a new block with a new link.  Am I making sense?  Could this work?

You don't need zerocoin for this, but the idea is similar to a zerocoin "ticket". You just put a hash of a serial in the same transaction where you sign the delegate, and the rule is that if the network sees the original serial then it considers the delegation revoked. This way you can take away voting power without taking your shares out of cold storage. Voting for a new delegate signer would require you to move the cold shares though.
Do not use this post as information for making any important decisions. The only agreements I ever make are informal and non-binding. Take the same precautions as when dealing with a compromised account, scammer, sockpuppet, etc.

Offline Agent86

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Re: Profits, Performance, Trust & Efficiency
« Reply #40 on: March 28, 2014, 06:52:34 pm »
I don't know that I completely understand the power that the trustee(s) have and what happens if all trustees colluded.  But, I'm willing to reserve judgement if you think it's the best system and give it a shot.

I think that if the mechanisms are not well communicated there would be a lot of FUD that would affect initial demand/value.

Offline puppies

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Re: Profits, Performance, Trust & Efficiency
« Reply #41 on: March 28, 2014, 07:31:12 pm »
With proof of stake your private key is your proof.   


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Do you mean private keys have to be risked with POS (forging) because they can not be used for forging when they are in cold storage?

They don't if you can sign for a delegate! Keep 90% in cold storage and have your 10% hot wallet sign for all of them. You could easily have revocation keys so you wouldn't have to take your shares out of cold storage to take away the voting power if your hot wallet is swiped.

I was thinking something similar.  Why couldn't you link your address to another address that has zero coins assigned to it.  You could then put your real wallet into cold storage and the empty wallet could provide security through POS.  If someone hacks my PC they would only get my voting power, and only until I pulled my wallet out of cold storage and used it to sign a new block with a new link.  Am I making sense?  Could this work?

You don't need zerocoin for this, but the idea is similar to a zerocoin "ticket". You just put a hash of a serial in the same transaction where you sign the delegate, and the rule is that if the network sees the original serial then it considers the delegation revoked. This way you can take away voting power without taking your shares out of cold storage. Voting for a new delegate signer would require you to move the cold shares though.

If there is an established means of providing security through PoS that doesn't involve having to leave your wallet online constantly, why not take that approach?
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Offline toast

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Re: Profits, Performance, Trust & Efficiency
« Reply #42 on: March 28, 2014, 07:36:08 pm »
I don't know that I completely understand the power that the trustee(s) have and what happens if all trustees colluded.  But, I'm willing to reserve judgement if you think it's the best system and give it a shot.

I think that if the mechanisms are not well communicated there would be a lot of FUD that would affect initial demand/value.

A trustee is just a node that asserts it saw a block by signing it. It stops forks, but gives the power to stall the network OR perform a double-spend with cooperation of a large number of shares. They would get caught though, which is actually really important.
Do not use this post as information for making any important decisions. The only agreements I ever make are informal and non-binding. Take the same precautions as when dealing with a compromised account, scammer, sockpuppet, etc.

Offline toast

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Re: Profits, Performance, Trust & Efficiency
« Reply #43 on: March 28, 2014, 07:36:42 pm »
With proof of stake your private key is your proof.   


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Do you mean private keys have to be risked with POS (forging) because they can not be used for forging when they are in cold storage?

They don't if you can sign for a delegate! Keep 90% in cold storage and have your 10% hot wallet sign for all of them. You could easily have revocation keys so you wouldn't have to take your shares out of cold storage to take away the voting power if your hot wallet is swiped.

I was thinking something similar.  Why couldn't you link your address to another address that has zero coins assigned to it.  You could then put your real wallet into cold storage and the empty wallet could provide security through POS.  If someone hacks my PC they would only get my voting power, and only until I pulled my wallet out of cold storage and used it to sign a new block with a new link.  Am I making sense?  Could this work?

You don't need zerocoin for this, but the idea is similar to a zerocoin "ticket". You just put a hash of a serial in the same transaction where you sign the delegate, and the rule is that if the network sees the original serial then it considers the delegation revoked. This way you can take away voting power without taking your shares out of cold storage. Voting for a new delegate signer would require you to move the cold shares though.

If there is an established means of providing security through PoS that doesn't involve having to leave your wallet online constantly, why not take that approach?

Did you see my delegates with revocation certificates suggestion? Comments?
Do not use this post as information for making any important decisions. The only agreements I ever make are informal and non-binding. Take the same precautions as when dealing with a compromised account, scammer, sockpuppet, etc.

Offline bytemaster

Re: Profits, Performance, Trust & Efficiency
« Reply #44 on: March 28, 2014, 07:42:30 pm »
I don't know that I completely understand the power that the trustee(s) have and what happens if all trustees colluded.  But, I'm willing to reserve judgement if you think it's the best system and give it a shot.

I think that if the mechanisms are not well communicated there would be a lot of FUD that would affect initial demand/value.

The trustee has only one power, to produce blocks that conform to the rules (or not to produce said blocks).
The trustee's power is delegated from the shareholders who can revoke it at any time and appoint a new trustee.
Redundancy is possible in case trustee is compromised.

Trustee cannot change the blockchain rules.
Nodes do not trust the Trustee but validate every single transaction.
Trustee cannot create alternative chains or get away with double spend attacks.

Without a trustee all other technical solutions are attempts to do the following:
1) Randomly select someone proportional to their stake in the system... they become 'trustee for a block'.
2) Pay / Punish this person for not producing a block.

As soon as you have this random selection you simultaneously open up the network for random attacks by anonymous parties.  The sheer number of hypothetical attacks that are possible under these 'random selection' processes means that the network is likely less secure and predictable.   All of a sudden people start mining blocks that exclude bids/asks to their benefit or to trigger margin calls.   Put another way, randomly selecting people to produce blocks gets you 'average' performance and 'random' manipulation.   Delegating through your proof of stake to a trustee maximizes the predictability and fairness of the chain. 

 

Remember, true decentralization is competition and reduction of barriers to entry.   

For the latest updates checkout my blog: http://bytemaster.bitshares.org
Anything said on these forums does not constitute an intent to create a legal obligation or contract between myself and anyone else.   These are merely my opinions and I reserve the right to change them at any time.