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RE: CBR Proposal: Update 2 - Only Three Weeks To Go!
A potential downside I have seen with CBR is a recent rise in PoS Pools, these pools have no attraction with a % based system, because you always get a fair share no matter your staking frequency. But with a CBR we may see coinholders pooling coins to try and get stakes, In my view this is unhealthy.
I think this should be monitored and plans should be in place ahead of time. What would we do if a pool overtakes the staking of Gridcoin? This is clearly worse than a few whales who are long term invested in the coin doing the same.
I think you bring up a good issue regarding PoS staking pools. This is likely something that will be developed even more moving forward. Even DPoS is very similar in some instances. I think how this might be used should be monitored, but ultimately I think PoS pools are meant for people who cannot stake on their own, and will be incentivized as such -- you will receive more reward as a whale staking by yourself than as a staking pool participant.
Encouraging more participation in block creation by allowing small balances to combine forces may be a good thing. It would distribute GRC among even more people while also distributing block production responsibilities among more than just high balance participants: increased competition. We will be sure to discuss it during this week's fireside chat.
As a side note, buying or PoW mining several million GRC for a few hundred dollars in 2013/14 (a unique time of a unique mindset in cryptoland) does not make someone a long term investor. Time, work, or using those GRC to literally invest in a product would make someone a long term investor. Even buying ~150,000 GRC for 10,000USD today could arguably make someone more of a long term investor than someone buying/mining loads in 2013/14.
Early adopter does not equal long term investor.
Consider, BTC bought/mined in 2011 was sold in 2013/14. Many bought/mined early, but were not invested long term and sold as soon as they achieved a nice profit. Those early adopters who were also long term investors used their young BTC to fund organizations and technologies that are very well known today.
Agreed a pool seems like a nice way for small-holders to get a chance at staking, crossed my mind too.
Its the snowball effect Im concerned about; crypto-pools always seem to end up the same way, they become centralised and the only way anyone has a chance of participating is to join those few pools that dominate. For PoW its bad, for PoS you actualy have to hand your coins to the pool owner, thats a disaster waiting to happen.
Yup. Solutions are on the way thanks to other blockchains.
IOHK is leading the charge. Some info in the video linked below.
https://www.youtube.com/watch?time_continue=1304&v=MeNJoJOgMHU
Thanks thats interesting. I guess a system with the k delegates as the target state, where if the same delegate authors a block withing k - n blocks of the last one the reward is diminished.
The closer together 2 blocks by the same delegate are authored, below a desired target, the less the block reward should be for the second block. This should be inversely proportional so staking consecutive blocks earns less than waiting for the target number of blocks to pass before trying again.
Reward % = (current block staked - last block staked)^2
So if delegate authors block 1 he gets 100% for that, but if he also authors block 2 he gets only 1%. If he authors blocks 1 & 3 he gets 100% for block 1 and 4% for block 3. Authoring block 1 & block 10 gives him 100% for block 1 and 81% for block 10. He must author blocks with a gap of at least 10 blocks between them to earn the maximum amount.
So the delagate and the pool members are incentivised to make more delegates, but not just 10 more because randomness will still present blocks below the threshold quite often, so there will be an incentive to make enough delegates of roughly equal weight to ensure rewards are as close to 100% as possible, but not to dilute the delegate count excessively. With 13 delegates in this scheme assuming they all staked at roughly 13 block intervals, each would earn 84% if the maximum reward, which is still better than the 81% they would earn by having just 9 delegates.
Just a rough idea that popped into my head, it must be harder than that though, surely...
If we ever move to a delegate system, I think this would work with proper verification
Right, delegates should be 'approved' in some way