Ethereum block reward change
For me at least, economic finality, see https: In PoW an equivocating validator builds on two chains can only be punished by reducing rewards and rewards are capped by issuance , in PoS an equivocating validator can be punished by slashing deposits. It must be guided through appropriately-configured communications channels and well-designed and fair governance processes. And I agree wholeheartedly that the planning has to occur now, informed by history and guided by well-established theory.
Regarding theory, it is important for us all to avoid understanding the macro-economic situation through a single lens, even if it has worked well in other cases or is comfortable. There are many schools of thought — in and even outside of economics — that can be helpfully employed in understanding the situation we see, understanding the future situation which we desire, and in guiding decisions.
I do not believe that macro-economic theory is being applied enough to this problem domain. Is there a reason why, or concerns driven by well-known failures in the application of various economic theories in normal economies? Most traditional macro-econ has to do with a mostly stable currency whose price with respect to the CPI adjusts at most a few percent a year in either direction in most cases, and which is used as a unit of account for both immediate services and long-term agreements.
Cryptocurrency is not remotely the same situation. Thanks vbuterin , this clarifies why you believe that traditional macro-economic theories do not apply to a cryptocurrency like Ethereum. The will cause a total havoc, literally Ethereum turning into a Skynet from the Terminator movies.
There are already example of things like that. Linux Kernel is an extremely vulnerable thing. Kernel viruses are untraceable by definition. Intel CPUs are extremely vulnerable, virtual machine hypervisors are extremely vulnerable, gcc compiler is extremely vulnerable. Bootloaders are extremely vulnerable. BIOSes are extremely vulnerable.
NSA has backdoors to all of this stuff. If Ethereum switches to PoS, it will be trivial for NSA to shut down at anytime, and not only for NSA, but for also for bad guys like totalitarian governments around the world. Is there any analysis work done to trace how miner rewards are being used in the network? Has it been determined if rewards are primarily exchanged for fiat or BTC vs. If you have a POS chain and all computers except one are infected, you can use a hard fork to reset back to to the correct state.
The problem though is that how do you differentiate two computers with slightly different chains? In other words, lets say all computers except two are infected. Then the two guys come to you and and say they have un-infected chains.
But the chains are slightly different. It then becomes impossible to differentiate the true good guy from the fake good guy. Or is this too paranoid? You effectively have a global catastrophic failure on your hands, the economic participants can take a beat and figure out what chain they want to use via traditional non-automated human communication like Reddit, Twitter, blogs, etc.
You can of course privately differentiate them, if this really happened I would check the addresses I have private keys for and see if I still have the same amount of ether, etc on both chains. If many people do this then the split would end up being resolved by social consensus presumably the two chains have different state, and someone would notice they lost something on one chain, or that one chain has an inflated supply of some token they care about.
I think you can also use a issuance dynamic adjustment per block to reduce volatility, if there is an automated concensus on the previous or previous sliding window gas consumed, you can estimate present change in price related to stable fiat, and then adjust the block issuance.
You can smooth with moving average. There is a recent article on correlation between many-day or month crypteconomy activity and price change:.
It would be very difficult to coordinate an attack like this and perpetuate the malicious chain without a portion of the network recovering from it.
The Linux kernel is used by many different operating systems built many different ways with many different versions of the code. This is on top of being in an environment where many non-Linux systems are in common use Windows, Apple, etc. And all those computers run on top of various networks of differing security and connectivity. The number of permutations here is roughly on the order of millions.
Ether inflation will lower its value only if supply growth exceeds the growth of network value. But as long as network growth is to be expected, I consider too little inflation more of a risk, because it has already started to turn Ether into another digital gold. It was supposed to be fuel for decentralized applications. So it increases quantity which reduces the purchasing power as modeled in basic quantity theory of money in Friedman Economists in traditional economy justify it by saying sticky prices induces demand on the margin, and higher inflation can induce people to invest in more which adds stimulus to the economy.
I think this is an important distinction when people get nervous about supply increases leading to direct negative impact on value a la Venezuelan inflation style.
Possible outcomes from altering the ether supply growth rate Economics. This file contains all the data that will be needed to generate block 0, including who starts out with how much ether.
If you find this post useful, I encourage you to follow my Twitter account, where I post more tutorials and low-level explanations. The config struct in genesis.
However, these values are important, because they also need to match the configuration information of any other node you want to interact with. There are three resources we will look at when examining config. This exists to tell the world which chain you are on. The intention in adding it was to make transactions on the Ethereum network look different from those on the Ethereum classic network. Transactions are signed differently depending on the chainID used. For more information on signing discrepancies and a list of well-known chanIDs , go here.
HomesteadBlock , when set to 0, means you will be using the Homestead release of Ethereum. This is expected, and the mainnet gensis configuration also has this set to 0. In , the DAO created a wildly successful smart contract for funding dApps and providing contributors a sort of equity stake in those dApps through DAO tokens. This contract was a novel idea that raised unprecedented amounts of ether. Unfortuneately, an attacker discovered an attack vector that allowed ether to be withdrawn from the contract multiple times in exchange for the same DAO tokens.
Ultimately, a majority of Ethereum users voted to create a hard fork in the blockchain that would invalidate what the attackers did, and the contract would be updated. This was a controversial decision, as the anti-fork faction rightfully claimed it set a dangerous precedent for the future: Since the majority voted to proceed with this fork, the DAOForkBlock variable was born, and it occured on the th block in the mainnet.
Thus, any block mined after this one would have to follow the protocols established by this new fork, and would be rejected otherwise. If we were creating a local Ethereum chain to test on, we might set this value to 0 so that we get the most up-to-date transaction behavior from the get-go rather than use an outdated protocol for the first blocks.
Ethereum is open-source, so people make proposals in the form of discussions and code. Some are accepted, others rejected. EIP is one such proposal that was accepted. This EIP took effect on block , and had mostly to do with increasing gas prices in response to denial-of-service concerns. In the mainnet implementation of config , we see:. The hash of the EIPBlock, which is needed for fast sync.