Flaws in Proof of Work Consensus

2018-12-15T04:12:43.000Z Honest Cash

There is a lot of weird theories floating around #cryptotwitter about Proof of Work (PoW) consensus and the justification for attacking minority chains. The whole BCH/BSV chain split has shined a spotlight on a few of the shortcomings of PoW consensus, and rather than acknowledge the shortcomings, zealots are using the contradictions to justify digital violence against minority groups.

The ‘Problem’ that Bitcoin Solves

Many of Bitcoins early proponents, like me, were attracted to the idea in 2009 because it proposed a solution to US hegemony and a way for individuals to protect their assets against banks that were ‘too big to fail’. Later, when payment processors unjustly cut off Wikileaks funding, it again provided individuals a way to fight back. Silk Road did much to bring Bitcoin to the center stage, again by empowering individuals to supersede the law and buy illegal drugs.

Bitcoin owes much of its success to libertarian ideals. It was born from the cypherpunk movement. For me, the essence of Bitcoin is individual sovereignty.

It’s important to keep this history in mind, because forces are working hard to pollute the original ideals of Bitcoin, and that is largely what this post was written to address.

Types of Morality

Morality is a very difficult and murky topic to discuss intelligently. Let me start by differentiating two distinct types of morality: ‘Ivory tower’ morality and ‘gut feel’ morality.

Here is an example I recently came across of ivory tower morality: is lab grown meat kosher? Who cares. This level of moral discussion is inane.

In contrast, gut-feel morality supersedes religion. Don’t kill people. Don’t hurt people. Help those who are suffering. Don’t take things that don’t belong to you. No one needs to tell you these things. They are part of what it means to be a human. These ideas largely encompass the non-aggression principal adhered to by many libertarians.

The Argument for Attacking PoW Chains

This twitter thread was the inspiration for this post:

Here is the obvious gut-feel response: any group of developers and users, peacefully working on their own crypto-coin idea, who has been attacked, would disagree with Javier.

I’m sure he’s a smart person, but I’ve never seen a better example of doublespeak in action. The thing is, he’s not completely wrong. Just as religious leaders engage in all sorts of ivory-tower logic to justify dietary restrictions, adherents of the cult of Craig Wright are fond of justifying the right to attack minority chains.

Avalanche

The BCH/BSV split showed that powerful state actors, or even deluded billionaires, can pose a significant threat to PoW chains. Even BTC is not safe, as the original BSV attack plans could easily be scaled up by a state actor to disrupt the majority chain.

Here is an all too common scenario: A small group of developers have an idea for a new cryptocurrency. Because Bitcoin is the most successful and well understood, they fork the code base and start working on their idea. They spend a couple years working hard and growing their user base. Suddenly a third party with a lot of hash power comes in and shits all over this groups work, justifying it with doublespeak about PoW consensus. 

Is the problem with the group, peacefully engaged in innovation, or is the problem with the PoW consensus mechanism?

Thankfully, a new consensus mechanism has appeared on the horizon called Avalanche

It’s still early days. There may be undiscovered flaws, but some of the most brilliant minds in the distributed computing space are working hard on creating new cryptocurrencies around this new consensus protocol. From my understanding, Avalanche may protect minority groups from the kind of PoW flaw described here.

As the Avalanche technology matures, I expect to see smaller cryptocurrency projects naturally gravitate towards it, if for no other reason that to shore up the shortcomings of the PoW consensus. 

Let a thousand flowers bloom. Let minority groups innovate and explore their ideas, so that we can all be enriched by them and individual sovereignty can be protected.

Responses


The Sanctity of PoW

by @m4ktub

It's a controversial topic: the sanctity of PoW. Thank you for discussing it. I once saw Andrew Stone ask "Is PoW aggression?" and the question lingered with me ever since. I think this will be an important discussion for 2019.