Hello, madsbuch. I feel the same way. Not so much about me, but I think in many cases young and enthusiastic cannot compete with old, patient, and experienced. Thanks for your comment. Richard
Not a great analogy imho. The ETH consensus change from PoW to PoS changes the way that blocks are signed and validated. No more PoW. Instead, now validators decide. It’s more like unanimous voting. If you try to sign a fake block, you lose some or all of your deposit.
This has no impact on anything really at all. It’s just re branding, hopefully to clarify things. ETH does not change with ETH2. It’s just a series of upgrades to eliminate wasteful proof-of-work mining and improve scalability.
The minimum amount required to stake is 32 ETH. That’s $75k at today’s price. There are cheaper was to “stake” but those are not really “ETH PoS” staking. So no, it does not “cost less to stake”.
There are ways to have a fractionalized stake, essentially the PoS equivalent of participating in a PoW mining pool. They call them staking pools, which seems logical enough.
I agree with you of course, but those are not “ETH PoS” staking, strictly speaking. They are just layers on top. You definitely make more running your own validators.
What are you comparing $75k to? My understanding is meaningful mining under PoW requires buying expensive mining hardware that goes out of date quickly. Under PoS there is no such depreciation...a laptop from 2020 will likely be able to run PoS in 2040.
I personally have been mining ETH for years with equipment I bought for $20k in 2017 - 2018. I’ve made many times my investment back. That same equipment is still running profitably today.
If I have enough, I will run a validator. If not I will probably do some defi like lido + curve + yearn. I may also mine something else like flux or raven.
There's initial capital expense, and ongoing expense. You're of course correct that the minimum capital is lower with mining. However, given a $75K initial investment, a miner has much higher ongoing expense.
So, my original point was to respond to the above comment: "Proof of stake requires none other than a single purchase to be gifted the right to perpetual seignorage."
My claim was that the lower ongoing expense of staking is compensated by lower rewards, so that both systems have similar profit for similar capital outlay. In setups where mining expense is almost zero, the higher rewards of mining give it much more seignorage than proof of stake.
In the US, probably around 10,000. US Banks all operate by virtue of a banking license issued at the state or federal level. Banks must do as they are told by these centralized authorities or else they lose their license.
Decentralization is about not needing anyone’s permission to participate and being free from censorship. You don’t need good credit or even ID to open an account and no one can seize your funds because of debts, fines, or taxes. Of course validators have their slashing rules, but those are programmatic. Not some judge in divorce court, for example.
> Decentralization is about not needing anyone’s permission to participate
But you do need permission, which is implicitly conferred by following the protocol. It's really quite similar to traditional banks, it's just that the protocol is digital/mathematical rather than legal.
There is no “ETH 1.0” token or “ETH 2.0” token. There is only ETH. They never “convert”.
Anyone can fork the code at any time and keep mining. Many have. ETC and ELLA are a couple examples. Ethereum Genysys is a recent project in response to the PoS move.
ETH 2.0 was always just a series of upgrades. “The merge” which will end PoW mining is expected to go live between March 30th and June sometime at the latest. Code is expected to be complete in February sometime. Testing is well underway already.
I am not intimately familiar with the staking terms on Coinbase, but from what I recall, you should be able to withdraw your ETH at any time and receive it in at most a few days. If it has a lockup period, those terms would be very clearly stated, and you would eventually get your original investment back plus rewards according to the terms.
