1/ Thread on variance. PoW mining is critical to Bitcoin network security. Mining, in turn, is subject to 3 major sources of variance, from (roughly) easiest to tame to hardest: i/ Finding blocks via SHA256 hashing ii/ Market demand (for BTC & transactions) iii/ Tech innovation
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However, implementing something like that might be hard, if not impossible. The problem here is block rewards are issued by *a single winner*. What incentive does the winner have to share his rewards with others? Can you embed that "sharing" behavior into the code?
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Yes that exactly is the issue. I'd love to hear an argument for why it's not workable. If you could bake it into the protocol the issues of miner centralization essentially disappear.
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And you could prove failed hashes, I think, with a shorter string of zeros in the proof of work, to show you did some amount of work.
@TheBlueMatt@peterktodd is there a good argument for why what I'm suggesting is not workable? -
My take: the reason "sharing model" works with existing pools is because pooling is inherently a *centralized* solution. Pool members have to agree on the coinbase transaction: the rewards go to a common pot which is owned by the pool operator.
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But it might not be possible to implement this in a *decentralized* way at Bitcoin protocol level. In a decentralized network, who would be the owner of this common pot?
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By "protocol level" do you mean the Bitcoin protocol? I don't think that's possible
It's binary: either you successfully mine a block, or you don't.
Pool protocols are different though, since they work on top of Bitcoin, they can assign rewards proportionally.