I actually it's probably no question you
expect myself I actually was going to
have you get to all three the difference
between group of work group of stake and
delegated the first a weather and also
maybe talk about how Bitcoin differs and
how you think it might compare to other
cryptocurrencies where actually occurs
that's a great question
current work is the system that Bitcoin
uses proof-of-work is a system that
provides security through an investment
of energy so you have to connect a
system that burns electricity special
running computers that's proof of work
alternative systems have since been
proposed and some of them are running on
much more small scale
proof of stake is one such system in a
system of proof of stake here's what
happens let's say you have this new
digital currency called Rincon's point
right and on this digital currency
blockchain instead of burning energy
what happens is you've won your computer
to check the rules and validate the
transactions for everybody else and
every ten minutes when you're validating
the rules what you do is you lock up
some of your digital rated point onto
the chain and it stays long for maybe
thirty lakhs or hundred blocks and one
that stays locked you commit to continue
final ratings and rules if you
invalidate them incorrectly you lose
that money
if you validate them correctly you get
the money back after say 30 blocks and
you get
of fees so now instead of investing
energy you're investing the digital
currency itself inside the system to
prove that you are committing to check
the security rules and help with the
security of the network there's a couple
of problems with proof of state that a
lot of people are trying to solve so it
doesn't necessarily mean there are
solvable problems one of the problems of
course is that that means that people
who have lots of coins or more points
the rich get richer we've seen this
before the other problem is that because
what you're committing is part of the
system and the system itself determines
its value you can get these strange
conditions whereby by cheating within
the system you may lose those points but
you gain so much in other ways that you
may come find where is when you're
burning electricity if you burn the
electricity outside of the system you
know you're never getting that back so
that's proof remark is an extrinsic an
extrinsic commitment system meaning the
what you're committing is an outside of
the system you're committing electricity
which you have to pay a bill for it in
the real world not in the system whereas
with proof of State its intrinsic you're
committing the currency of the digital
system in the digital system to borrow
the in the digital system the other
problem has to do with historical
record-keeping I think one of the
advantages
despite that it's very expensive and
uses a lot of energy is that it allows
you to create a level of immutability
for the records now what if the
interesting things about watching is
that once something is reported on the
blockchain you can't go back and change
it because to go back and change a block
that's ten blocks behind because the
next block depends on it if you change
it you have to change all of the blocks
after it and for every one of those you
also have to redo all of the mining
which means you have to read invest all
of the electricity and if you do you're
invalidating the previous change so if
you got paid once and you've spent
electricity twice so you're doing it for
free I just kind of employed which means
that it's very difficult to change
something that's being recorded on a
proof-of-work watching what I say
difficult the numbers are absolutely
staggering at the moment Bitcoin is
running it between 500 megawatts and the
gigawatts of electricity in real time if
you wanted to change one day Bitcoin
transactions that's 144 blocks of 24
hours you'd be looking at 1.2 gigawatts
or 1.2 gigawatt hours of electricity has
enjoined electricity
you'd have to invest very large amounts
in order to get maybe nothing in return
right so with proof of stake systems
however there is there isn't that
external backing there's a third system
called delegated proof of stake which is
a slight twist on proof of stake or what
you can do is you can say I'm going to
park my money with this other party
they're going to lock it up in the block
and they're going to do all of the
and Foundation and we're going to share
in the reports that's a bit like and
electing a representative to Congress
and having that make decisions for four
years and then after four years you
decided you're going to fire them on
that only you do it on a shorter
timeframe because it's weight loss again
very interesting in fact I think we're
going to see combination systems end up
having a group of state system Learning
Network which allows you to earn fees by
creating payment channels where you have
to commit money into the payment
channels to make them run and then you
have to validate all of the transactions
that are traveling across your payment
channels and if you validate them
correctly you get fees that kind of
sounds like a perfect safe system so you
can have this hybrid system work Bitcoin
some of the rules of validated by proof
of work all change and one of the
Austrian transactions on lightning
network are validated by effectively a
proof of state system you can have a
hybrid they're all interesting what can
we say about the security of these
systems we can say that Bitcoin security
achieves security for 37 billion dollars
on proof-of-work how do you know because
there's 37 billion dollars that no one
has been able to compromise what can we
say about delegated proof of stake at
the moment we can say that it's about I
think 750 million dollars so there's
this difference in scale over time both
of those will push forward and we'll see
what each can do when it's put under
pressure and a lot of this really only
matters when you're being attacked right
you can have the best plan in the world
if you're not being attacked
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you