PoS vs PoW Valuation?

Thoughts on why generally PoW coins are higher in value than PoS coins?

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PoW is a link to reality


My theory: PoW miners are pumping their coin prices thru exchanges, adding to future rewards.

As mining gets more centralized, costs will rise, and regular cryptocurrency users will start becoming more incentivized towards using PoS coins, for cost reasons. There will naturally be a point where is flips. But the initial investment in the overall space is a good thing, just not necessarily sustainable in the long run.

maybe because it costs a lot of money to create a PoW block, this is the money put in the network, or invested, the proof of the work is expensive, im not sure, there doesn’t seem to be a direct link between pow difficulty and price, of course miners want to earn back their money (and than some) but idk if they can dictate prices like this
, how would they do it anyway, tell other miners not to sell their coins below a certain price? or what

^Would be those who mined or bought when it was around US$0.05 or less who would be able to afford selling at less than what it costs now, as they could still recoup their expenses and make a significant enough profit to tide them over. Eventually, the sell walls would come tumbling down and the price would adjust closer to what it currently costs to mine a PoW block. It’s only a matter of time.

PoW deserves greater value because it also includes the value of the electricity in addition to speculation. Also, PoW is more secure because the security of the whole coin is tied to “what you have” in addition to “what you know”. It is way more difficult to steal/rob/destroy a lot of ASICs around the world than to do the same for PoS tokens. The DAO hack illustrates this situation fairly well. The only place where I see a good use for PoS is in the emergency difficulty adjustment (EDA) algorithm to avoid oscillations. When EDA kicks in the coin should become a PoW/PoS hybrid for a while to keep the blocks going out in a fixed rate until the PoW difficulty adjusts.

I just spent like 10 minutes of my life searching for this.


And your point is?

Just spent like 1 minute of my life searching for this:

On the stage right now: people representing approximately 100% of Ethereum’s consensus mechanism :joy:


The miners can increase and adjust their sell walls holding until the price recovers their cost, without needing to collude? Collusion or malicious exchanges of course can also cause the price to jump.

It’s not PoW or PoS that leads to centralization.

Centralization is fueled by:

  • High block rewards (requires pooling) Bitcoin
  • Fast block times (requires low latency) Ethereum
  • Gamification of algorithm (possibility to gain advantage due to clever tricks or strategies) Ethereum (Casper)

Isn’t gamification inherent in PoW mining as well, the constant struggle to gain some type of advantage over your competition so you can gain more rewards?

Yes, and I’m led to believe this is swept under the rug due to the strong performance of Bitcoin. The most obvious gaming is mining empty blocks. It’s a nice feature of Peercoin that it chooses the block with the largest consumed coin age to favor including transactions rather than dropping (where max coin age is limited to 90 days).

I meant more like having to purchase more powerful and efficient hardware, but I guess there are protocol tricks as well. With Peercoin’s PoS, we’ve tried to make it so that all security providers are equal, so that it’s near impossible to gain any type of advantage.

Every algorithm can be gamed.
Even our PoS algorithm can, but the gains are so small that it’s not worth spending time to do it.

The problem with algorithms like Casper or other so called non-naive PoS algorithms is that they are so complex and designed to be gamed to be able to “put something at stake”.

PoW is strong because it is extremely simple. That’s why I believe in a simple so called naive but fair PoS algorithm, combined with limited amount of PoW that injects entropy in the chain.


strongmarket performance of Bitcoin.