Why does not Bitcoin migrate to proof-of-stake?


I feel there are some very convincing theoretical arguments to be made, however there’s additionally only a very sensible consideration:

Proper now, a really giant portion of BTC is being held within the chilly wallets of widespread alternate platforms. Hardcore bitcoiners will shake their heads and declare “Not your keys, not your cash!”, however this apparently has not stopped merchants and regular customers alike from preserving their cash saved with a custodial third social gathering. Wanting on the ‘bitcoin wealthy checklist’, we are able to affirm the massive variety of cash held by exchanges.

This reality would put alternate operators in an undue place of energy over the community: by staking cash owned by their customers, the alternate operators can get hold of a big, centralized level of management over the community’s consensus operations.

There are already dangers current when permitting a 3rd social gathering custodian to handle your cash/personal keys, however switching to a POS system provides a completely new and really critical kind of threat! It is a very critical threat as a result of it’s existential in nature: if an alternate operator have been to abuse their management of this large variety of cash by some means (by staking maliciously not directly or one other), it could have an effect on each consumer of the system, not simply the customers of that alternate.

This drawback is barely amplified by the truth that you need to not solely belief the alternate operators to not act maliciously, you additionally should belief them to safe their system towards theft and intrusion. It’s unhealthy sufficient when hackers steal funds, giving hackers the flexibility to assault the community consensus as effectively is, for my part, an untenable addition of threat.

In case you are not satisfied: This threat isn’t theoretical, an assault like this not too long ago occurred on an altcoin community (Steem, mid-late Feb 2020). It seems that exchanges colluded to stake the cash they held custody of, in an effort to disrupt community consensus. A fast websearch brings this text about it up.

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