Comment by Kranar | Hacker News Reader

Comment by Kranar | Hacker News Reader

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Yes Bitcoin mining centralizes along the ability to mine which involves things like electricity, technology, politics, social factors, maintenance, and a host of factors. The point is that all those factors are quite dynamic and can change from year to year.

Proof of stake entrenches a group of rent seekers in perpetuity, without the need to do anything external, or anything whatsoever. The risk of mining is quite high as we've seen the past few years and there is no singular entity that has dominated Bitcoin mining for more than 3-4 years. Furthermore even when Bitcoin was dominated by Bitmain and a few other miners predominantly in Asia, they were unable to use their mining power to influence Bitcoin.

So the argument comes down to Bitcoin depending on external factors that are quite risky and requires constant upkeep and innovation in order to maintain ones position in the ecosystem, versus proof of stake where absolutely nothing is needed to maintain one's position.

> Proof of stake entrenches a group of rent seekers in perpetuity,

Ahhhh, that's a light bulb for me.

PoS is a step backwards in security, but perhaps not a meaningful one. Bitcoin has proved itself to a rock, or possibly a mountain range when only a rock is needed.

But yes, Bitcoin's mining fees are very carefully structured to be a near perfect market. Not so great for the miners - but perfect for the currency and it's users. Now you mention it, or Ethereum PoS looks like an excellent mechanism for the dominant Ethereum holders (which includes the founders - a point I'm sure hasn't escaped them), to entrench their position. I think we can safely predict things will take their natural course over time - and they will start charging what they think the market can bear.

Staking is not any more rent seeking than mining is. Stakers calculate and propagate valid new states for the chain. I also don't see anything entrenching or perpetual about it.

It's not as though increased mining efficiency provides some net good for the Bitcoin blockchain, e.g. increased transaction throughput. It just provides a profitable edge for the miner. You'd just expect difficulty to increase, not energy usage to decrease. I don't think there's any particular reason to desire this sort of cross-miner competition that produces negligible societal gain.

From one point of view, housing is a service landlords provide to the society. It's still rent though.

Stakers are landlords in the same way that miners are. They have lower expenses, but they also get less revenue.

The economic concept of "rent-seeking" as it's used now has relatively little to do with rental contracts as they pertain to housing.

https://en.wikipedia.org/wiki/Rent-seeking

E.g.: "The classic example of rent-seeking, according to Robert Shiller, is that of a property owner who installs a chain across a river that flows through his land and then hires a collector to charge passing boats a fee to lower the chain. There is nothing productive about the chain or the collector. The owner has made no improvements to the river and is not adding value in any way, directly or indirectly, except for himself. All he is doing is finding a way to make money from something that used to be free."

Sure, I'm just saying that staking is rent-seeking. If we try to argue that it is not, that argument would also literally apply to the rent.

Renting housing is generally not rent-seeking - that's exactly my point. If a property goes up for sale one can (1) choose to invest capital to purchase it, and (2) offer a contract for housing at a managed property to people who can't necessarily afford the capital investment of property purchase. Providing a service (housing access and property upkeep) in exchange for money is literally not economic rent-seeking (gaining wealth without any reciprocal contribution of productivity).

It's only for the particular school of Georgism (which holds that all undeveloped land value should be rightfully owned by citizens equally) from which the phrase originates that the transaction of "housing rent" is viewed as unjust enrichment (in that the majority of the cost is assumed to merely cover rights to the undeveloped land). Even through this economic lens it's difficult to make the "rent" definitions align, as the notion that a property might "go up for sale" is already a violation of the principle - the landlord is still providing a service with investment capital, they're just forced to work within the confines of the system for private land ownership.

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