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Incorrect statements in "How does the decentralization of proof-of-stake (PoS) compare to proof-of-work (PoW)?" FAQ #74

Open AlexSSD7 opened 2 years ago

AlexSSD7 commented 2 years ago

To join as a miner in a PoW network, you need to purchase mining hardware (often specialized hardware called "application-specific integrated circuits" or "ASICs"), have access to a cheap and reliable source of energy, and have a substantial level of technical skill to run and maintain your "mining farm". Small-scale mining is possible, but economies of scale make it difficult to compete with larger and wealthier mining farms. Furthermore, because of their large electricity consumption, centralized authorities can easily detect mining farms and shut them down or coerce them into participating in attacks.

You don't need to purchase specialized hardware. You just need to get a GPU (which I'm pretty sure most of people already do) to get started.

Also there are some companies like NiceHash who simplify the mining to the skill level of 5 year old child (i.e. they provide one-click mining software that requires no setup). Not an advertisement on NiceHash whatsoever. They also provide GPU auto tuning & overclocking functionality bundled with their one click miner, which means that no skills are required from the miner here. Although the statement above is closer to be correct if we are talking about large operations, as they indeed require some more skills. But again there are a lot of automation tools that makes things very easy. Mining today is not like the mining we had in pre 2016, where only pros could mine cryptocurrency.

PoS, especially the form of proof of stake used in Ethereum, is much friendlier to smaller participants. To join as a validator and start staking, you need to provide 32 ETH (and if you have less than that, decentralized staking pool tech based on multi-party computation is under development).

Should add that the statement above is completely wrong, as the minimum investment mining requires ranges from $0 USD to $1000 USD (probably up to $2000 or even $3000 given the supply shortage we have in 2021-2022). Not even close to $100k non-custodial Ethereum staking requires (although you can join staking pools, but decentralized ones usually have bad UX, and custodial (centralized) staking pools damage the centralization).

Staking larger amounts of ETH requires more hardware to process more shards, but this is only expected to be a serious issue if you are staking millions of dollars.

Issue here as well. Staking larger amounts doesn't require more hardware. You can successfully run 10k validators on one laptop, and it will work just fine (I was doing so myself during the era of Beacon Chain testnets). Also sharding is not live, and when it will be, the requirements to run a validator will be the same as running 10k validators on the same machine. It's just that post sharding you will be required to run 64 separate Geth nodes, but again allowing any number of validators.

InsideTheSim commented 2 years ago

Please feel free to open a PR with the changes against the .md files!