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Comment by dmichulke | Hacker News Reader

Let's say it like this:

In the near future the rules are made by the people with the most ETH

and soon after the most ETHs will be earned by the people who make the rules.

The rules have always been made by the ethereum foundation and friends. How many rollbacks and forks have they done at this point?

Just the one I think? Sure there have been network and client issues at times but that goes for Bitcoin as well.

I believe there were more than that one. From what I've read some time ago, to prevent the Ethereum 1 (proof-of-work) chain from continuing to exist after the migration to the Ethereum 2 (proof-of-stake) chain, the Ethereum 1 protocol has a built-in "difficulty bomb" which dramatically increases the proof-of-work difficulty after some time. But since the migration to Ethereum 2 has been delayed for so long, they've had to reset that "difficulty bomb" more than once (making it trigger later), which AFAIK requires a hard fork (and updating all nodes with the new rules).

This was always (well, long enough) a part of the plan and openly communicated. Dropping or changing difficulty bomb does not depend on the EF or the client software maintainers. Dropping or extending it preemptively would be trivial and would have been done already if there weren't consensus to keep it in place. It's in everyone's interest that nodes stay up to date if the network is to evolve and without it there would probably be a couple of years more until the merge that is scheduled for next month.

The first difficulty bomb was never set with the intention that this would be the move to PoS. It's a conscious choice to introduce regular hard forks in order to keep the protocol and network evolving.

It looks very likely that some percentage of node operators and miners will patch out the bomb this time, which will result in the PoW side of the fork staying alive. Which side of the chain retains monetary value in their tokens is up to social consensus. It will probably differ from protocol to protocol. So far industry and most major exchanges have been aligned with the rest of the Ethereum community here.

What you're saying is mostly correct but seems taken out of context. I've only ever seen people looking in from the outside have strong opinions on this particular point, not from the actual stakeholders involved.

That's not true. Stakers don't make the rules any more than miners make Bitcoin rules.

The rules who to include in the block. Imagine 51% of validators exclude people who use Tornado cash (as an example of addresses that somehow relate to a smart contract)

The rest has to agree otherwise their stake is slashed.

This can't happen in bitcoin.

Please correct me if I'm wrong.

In scenario when 51% coalition is censoring everyone else (block producers / validators that don't belong to coalition), the way out is via UASF - user-activated soft fork. This will cause slashing of attackers via "inactivity leak mechanism".

Source: https://vitalik.ca/general/2020/11/06/pos2020.html

Thanks. To me it seems this would greatly damage the value of the assets (like the blockchain wars but for ETH) but yes, it can be recovered from.

I think the problem here is centralization and this can be more easily avoided in PoW (because of energy costs rising a lot if all miners go in one place) instead of PoS (there are no physical restraints, so in theory all staking pools could be in Switzerland).

So politically it's much harder to censor a more decentralized chain.

The flip side is it's virtually impossible to hide a large-scale mining operation. The meatspace footprint is just gigantic. By contrast a validator node, even one securing billions of value, can run on consumer hardware sitting behind a VPN or TOR gateway.

> To me it seems this would greatly damage the value of the assets but it can be recovered from.

Why? I see this as an event that would skyrocket the price. It at the same time affirms commitment of the community to its stated values and decreases the supply greatly.

Miners do make Bitcoin rules though, the entire protocol is a consensus protocol driven by the miners.

Rules of the system are implemented in the software validating the block, in so called "full nodes". It does not matter how much hashing power miner has - if they will produce invalid block, this block will get rejected by nodes. Miners have very limited powers: they decide which transactions are included (this is why we need many miners) and they decide in which order transactions are included. Users decide which token they hold (BTC or BTC Cash or Eth), which node software they run. Miners are low-margin workers.

Wrong; if miners deviate from the rules, then their blocks are simply ignored by everyone else.

If a group of miners with minority compute power deviate from the rules they are ignored. If a group of miners with majority of compute power deviate from the rules, they become the rules.

This process is how all changes to Bitcoin get rolled out.

The rules of the Bitcoin network are not validated by miners, they are validated by nodes. The miners have no control over nodes and unless their mining work is accepted by the consensus rules of the nodes they receive no mining reward.

> On 21 July 2017, bitcoin miners locked-in a software upgrade referred to as Bitcoin Improvement Proposal (BIP) 91

> By 8 August, another milestone was reached when 100% of the bitcoin mining pools signaled support

https://en.wikipedia.org/wiki/SegWit#Activation

That's signaling, built into the end users fully-validating nodes, to coordinate between the miners producing blocks and nodes validating them. The validating nodes are the ones that offered up and then accepted the signaling.

Signalling is not consensus I’m afraid…

Miners and nodes have to be in agreement, when they're not you're right they've essentially fork BTC but I think you're wrong about who really holds the power and which chain would end up being the authoritative one after such an event.

If a majority of miners implements new rules that the validating nodes don't support, then the blocks are just ignored. They may as well be mining Bitcoin Cash or Litecoin blocks.

The majority of miners implementing new rules only has an effect on which rules the validating nodes will start enforcing if those nodes implemented them and allowed miners to signal when to start.

Indeed, in Bitcoin it's "one CPU one vote", and by CPU it means any validating Bitcoin client.

A big miner has the same voting power as you with the client running on an RPi.

They do not, they simply produce blocks. If they produce blocks that don't comply your nodes rules you'll ignore them and it would simply be a liveness fault and not a safety one.

And then the ETH becomes worthless, and despite having all the ETH, those people have no real-world money.

I'm confused why anyone would downvote this. Would you buy into a cryptocurrency where the validators are censoring transactions according to an agenda, or the one down the street where they're not?

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