Why do we still run PoW in Peercoin if it is not used for security? or is it?

Seems like some blocks and transactions are covered by PoW:

http://peerchain.net/blocks.html

PoW does not contribute to block chain security: http://www.peercointalk.org/index.php?topic=2606.msg22152#msg22152
PoW blocks include transactions.
PoW and PoS blocks have a ratio from 1:1 to 1:12 http://www.peercointalk.org/index.php?topic=504.msg32962#msg32962

The reason for Peercoin’s PoW process is to have a mechanism to distribute coins. Coin distribution in PoS concepts is a major problem (just look at NXT or PoS coins with a very short Pow mining phase like Blackcoin…), which is solved by an ongoing PoW process the best it can be handled so far.

Thanks masterOfDisaster - great reply
But could you elaborate on what you mean by “PoW blocks include transactions”?

[quote=“crypto_coiner, post:3, topic:3134”]Thanks masterOfDisaster - great reply
But could you elaborate on what you mean by “PoW blocks include transactions”?[/quote]

I meant that PoW blocks carry transactions, although they don’t contribute to block chain security in general.
Solving a PoW block requires meeting (in fact rather surpassing) the difficulty requirements so you can rely on the validity of the tx that are included in a PoW block.
But in case of block chain forking the “bnChainTrust” is solely determined by the trust values of the PoS blocks (being in the billions whereas the PoW block trust is 1).

I think NXT is not having problems with distribution since it has a fixed amount of coins.
What it does is that it recycles its transaction fees. very similar to PPC’s PoS that burnes its transaction fees and gives 1% annual interest without being a “closed” coin.

[quote=“masterOfDisaster, post:4, topic:3134”]I meant that PoW blocks carry transactions, although they don’t contribute to block chain security in general.
Solving a PoW block requires meeting (in fact rather surpassing) the difficulty requirements so you can rely on the validity of the tx that are included in a PoW block.
But in case of block chain forking the “bnChainTrust” is solely determined by the trust values of the PoS blocks (being in the billions whereas the PoW block trust is 1).[/quote]

Thanks for the elaboration

I think it is a problem to sell all available coins in a kind of IPO to only a bunch of people…
…and I think that an ongoing distribution (of newly created coins!) by PoW as it is done at Peercoin is clever compared to other approaches.
But this is only my humble opinion :wink:

Buahaha, Peercoin’s “Developer” mark is lower than Maxcoin’s :)).

…don’t you think this response fits better here: Cryptoblog - notícias sobre bitcoin e criptomoedas! ? :wink:


Seen on: https://bkchain.org/ppc
We used to have a ~1/5 ratio of POW blocks. The ratio switched to ~1/20 (1 POW block for 20 POS blocks).

(Current PPC price: $0.63)

That seems strange as PoW blocks should have an average space of between 10 minutes and 120 minutes.
But maybe it’s just a random variation?

[quote=“masterOfDisaster, post:11, topic:3134”]That seems strange as PoW blocks should have an average space of between 10 minutes and 120 minutes.
But maybe it’s just a random variation?[/quote]

The PoS diff goes up dramatically to 16.6+ from around 15, which is a record high.
http://peerchain.net/

pow difficulty is dropping too, fyi

according to https://peerchain.co/status there s 92,3% pos blocks over the last 24h which is a just little higher than the 11/12 target

[quote=“thehuntergames, post:13, topic:3134”]pow difficulty is dropping too, fyi

according to https://peerchain.co/status there s 92,3% pos blocks over the last 24h which is a just little higher than the 11/12 target[/quote]

Exactly, maybe the PoS miner are squeezing out the PoW miner.

[quote=“redlee, post:14, topic:3134”][quote=“thehuntergames, post:13, topic:3134”]pow difficulty is dropping too, fyi

according to https://peerchain.co/status there s 92,3% pos blocks over the last 24h which is a just little higher than the 11/12 target[/quote]

Exactly, maybe the PoS miner are squeezing out the PoW miner.[/quote]

I think it means that hte PPC miners are mine-and-sellers instead of miine-and-holders, adn PPC miners don’t have the most efficient mining rigs. Because coin price is falling, and PPC net hash rate increases as the same rate with BTC (with per block PPC also decreasing), the miners shut down as the miined coins cannot pay for the electricity.

[quote=“masterOfDisaster, post:11, topic:3134”]That seems strange as PoW blocks should have an average space of between 10 minutes and 120 minutes.
But maybe it’s just a random variation?[/quote]

As far as I understand, POW and POS are not correlated. PPC miners just switched to the next profitable coin since PPC’s price crashed down, so less and less POW blocks are showing up.

This once again proves that most miners are not holders, and just dump their coins for BTC or FIAT whenever it is profitable to them. Have a look at the order book fiasco, miners are just waiting to sell their PPC at the price for which they were profitable. On the other side, the good news today is that there are more and more people involved into PPC (that’s what this POS difficulty increase tells us), and those people who are minting ARE holding. But we don’t have enough people to handle the POW’s hammer, even Bitcoin cannot handle it anymore (yes, I think this is one of the reasons why BTC is going down now).

Miners are just hammers, and it is clear to me that they are the main reason why PPC’s price is in a very bad shape now. If the coin’s price continues its downtrend, investors won’t show up. And the coin will continue its downtrend until:

[ol][li]Miners stop dumping their PPC[/li]
[li]POW difficulty drastically increases due to the lack of new coins created by POW’s blocks (we have this limitation for POW, luckily…)[/li]
[li]We just shut down POW now.[/li][/ol]

The only reasonable solution I see for now is either to shut down PPC’s POW or just wait for miners to create a lack of new PPC created by POW (but the problem for now is that PPC is quite young and for this to happen we’ll have to wait several years…). This lack of PPC by POW won’t happen naturally, miners need to be present, mine the coin to death and for this to happen, they also need to understand the advantages of PPC to switch from BTC to PPC for reasons that are other than profit… otherwise those new miners will still dump PPC for BTC.

The fact that we are using the same algorithm to mine PPC and BTC makes the coin subject to the big miner’s hammer (basically the global hashrate that is used today to mine Bitcoin). If tomorrow PPC reaches $10 really fast, miners are just going to switch from BTC to PPC and will dump their mined coins like madness because they will be very profitable compared to BTC. They will also more likely dump for FIAT or BTC (in the BTC’s case, this is ALL their mined PPC coins that will be dumped on the market…).

So the question is: Do we really want to wait for a “natural” lack of new PPC created by POW? Or force a POW shutdown now?

sorry to say but they are related.
The control loop will try to have a 1/12 ratio of pow blocks by adjusting the pow diff
the pos diff is adjusted to have a pos block every 10 minutes

I wrote a post somewhere that describes this control in more detail

[quote=“thehuntergames, post:17, topic:3134”]sorry to say but they are related.
The control loop will try to have a 1/12 ratio of pow blocks by adjusting the pow diff
the pos diff is adjusted to have a pos block every 10 minutes

I wrote a post somewhere that describes this control in more detail[/quote]

So if the POS diff drastically increases, then the POW diff drastically decreases? Which means that miners will be more rewarded if more minters are minting?

Makes sense then, because otherwise POW would definitely take the lead too :-/.

The flip side is that more PPCs will be created. More PPCs generally means more minting.

if minters all install peerunity/box -> pos blocks found faster than 10 minutes -> pos diff increases -> pos blocks found back to 10 minutes
meanwhile, if hash power stays the same, the ratio pos/pow increases temporary during the dip, pow diff adjusts downwards and slowly adjust upwards back to as it were before the pos jump.
so at the end of the day pow diff stays the same, and so is the pow reward.

Other than that, what Thireus said is valid. Miners will dump ppc, the ppcbtc ratio will stay in the same range…