Quantitative Analysis of Staking Times in Gridcoin V8 - Live at Block 1010000 with v3.6.0.2
I caught a lot of flak for the staking time estimates I presented here on the 24th of August for the upcoming V8 staking system on the Gridcoin blockchain. These were based entirely on averaging and interpolating stake times of Gridcoin investors and miners in the current staking system, and as such they were likely to be off by up to 20% in either direction. After discussions on the estimates with Ravon, it occurred to me that a much simpler estimate can be generated which I would like to explore here.
Under the V8 staking system, your magnitude will not help you stake. As such, we only have to look at the coin supply and the holdings of each individual to determine their stake chances relative to the rest of the network. Let's start by gathering some of the facts. The current number of coins actively staking is roughly 130 million, as shown on the gridcoinstats.eu block explorer.
Further, looking at the same image we can see that the network stakes roughly 900 blocks per day. Assuming that every coin has equal stake weight, it follows that you would need 1/900th of the actively staking coins to stake one block per day, on average. We can extend this same logic to calculate the number of coins needed to stake once in any other timeframe, on average. You need:
- 144,000 GRC (USD$5760 of GRC) to stake daily
- 21,000 GRC (USD$840 of GRC) to stake weekly
- 5,000 GRC (USD$200 of GRC) to stake monthly
- 800 GRC (USD$32 of GRC) to stake every 6 months
These numbers are all well withing the ballpark of my estimates presented previously.
Analysis Limitations and Extensions
Please note that this analysis ignores:
- Coin being removed from the pool of actively staking coins temporarily when they stake a block. As such, there is a small error introduced in the daily estimate.
- The likely increase in the cost of GRC. New researchers are unlikely to buy in if the cost of GRC is prohibitively high.
- The inevitable increase of network weight as more coins are minted, and more investors keep their wallets online.
In fact, there has been significant discussion of only allowing investors to earn interest when their wallets are online, in the form of fixed block rewards. This makes sense, as the interest they are paid is to secure the network, which they are not doing with an offline wallet. If we repeat the analysis after such a change where we assume all coins are actively staking (390 million GRC), the results become:
- 432,000 GRC (USD$17280 of GRC) to stake daily
- 63,000 GRC (USD$2520 of GRC) to stake weekly
- 15,000 GRC (USD$600 of GRC) to stake monthly
- 2400 GRC (USD$96 of GRC) to stake every 6 months
Closing Words
I would like to reiterate again that I wholeheartedly support the need for the mandatory update being pushed in order to secure the network. This is paramount and comes before all other concerns. However, it is important that the severe repercussions for most miners are understood and can be discussed openly. There have been numerous ideas fielded on new payment systems for miners, and I look forward to seeing one of these being realised some time in the future.
On this same note I discourage anyone from remaining on the current fork when the mandatory hard fork is reached at block 1010000.
If anyone would like to discuss this further, I would happily continue this conversation below or by PM on the Gridcoin Slack.
Some numbers from my test:
Unless I'm way off you would then need 989000 hours to stake with 1 GRC. With 11000 and no mag you should stake every 90 hours, or every 3.7 days. If I'm right you need 41208 GRC to stake daily given the past few days' difficulty.
With these numbers we get:
The only reason for this discrepancy I can agree with is if the network weight for the total number of coins is incorrect. Looking forward to the reply from the Blackcoin devs on this one.
Of course, I hope your numbers are a good representation of what to expect in V8. Those investments (while still too high for many new miners) are manageable.
I agree that they are too high and that we should come up with alternative ways of paying the researchers. Luckily several options are in the pipe :)
has anyone actually been earning more staking then they would of holding their funds in Bitcoin? I dont think so.
Wow, I can't believe Bitcoin made it onto Family Guy. To bad its a skit where Peter makes it sound like an awfule "Peter" type of idea. Lol
Please don't spam.
Nice analysis @dutch.
For all the hand wringing over this change, I do want to say that most newbies mine ina pool until they can go solo, al we are really seeing here is newbies having to stay in the pool a bit longer.
I agree 100% we should find a secure method to move beyond pure PoS and include some form of faster payout, that method just needs to be discovered.
I think one of the problems here is that the net weight either cannot be the amount of actual coins staking, or you cannot use it to derive your chance to stake. With my 46k GRC and my additional 4k GRC from my magnitude I can stake ~2 times per day. If it was just down to coins staking we would need a network weight of 22.5 million in order for me to get an average or 2 stakes a day, right? I have asked the Blackcoin developers for some clarification regarding this number.
Until then I will continue to run my staker-only test. Right now it has only been 1 stake in 24h :(
I talked with @sc-steemit and they said that based on the information given the numbers I used from the block explorer are the number of coins actively staking. If the documentation on this in the source is poor and it turns out that the number used does not accurately reflect the total number of coins staking, then I agree my numbers are void. Looking forward to the reply from the Blackcoin devs.
The only way that could be true is if, on the whole, coins to not have equal stake weights. I have no reason to believe that is the case.
Luckily this coin is established. If this were a new coin it'd make me think of a scam. You need a base to be able to earn at all and you need more to earn more frequently. Luckily there's the pool.
Its how most PoS coins work, so its not really unheard of, back when I joined Gridcoin Magnitude didnt count :)
I'm talking about the effect on PoR
What are the effects on PoR though? If we disregard the design flaw which allows people to scale their magnitude stake weight out of proportion, the amount of weight the magnitude contributes to the staking is tiny at best.
To be honest. When I replied I thought I understood the mechanism. Now I got confused. I thought I understood that coins mined only get transferred to your wallet when you stake. Since a lower balance results in less staking I made the previous conclusion.
To put it in another extreme way. Suppose you have an empty wallet. Will you then stake? And if not. Are the mined coins lost?
You were right, you only get rewarded (PoS or PoR) when you stake a block, and you do need funds to stake.
This is confusing. I just implement the Boinc & Gridcoin setup from your introduction post for newbies. It taught you how to set it up, today I'm still mining for about a week. I still do not have a cpid number yet. With all these changes I'm lost. Maybe I will just mine for fun and help science since my lap top is a few years old. Or should I don't worry about these thing till this update shakes out ?
If you are just starting out, and do not have a lot of hardware, there is no real need to worry about these changes. You can continue to go at it solo, but it means you will have to buy some GRC to help you stake. Alternatively, you can join the Gridcoin pool instead which will do the staking for you and pay you out your cut.
Gridcoin Pool Mining 101 - Start Here!
If you do chose to go solo, you will need to get your beacon sent. Given you have been running BOINC, you certainly have a CPID already, it may just not have been registered with the Gridcoin network. Pop into our Slack or IRC channel if you would like a hand.
Yes I will look into finding the slack or IRC channel soon to get more help . If I can not find the CPID number. Thanks and upvoted.
Hi @dutch nice statistics you brought up here. Iam really looking forward to the times when V8 is live because then we will know and not just speculate. But again I can not agree more we need to find an easy solution where the normal random researcher can be rewarded once or twice a week without a big hassle or the need to invest a lot of dollars to have that possibility.
While I agree that it will be interesting seeing V8 in action, what part of the above would you label speculation?
Well sorry for the word it is not speculation it is more a statistical analysis how things could turn out. And iam totally in thinking ahead how things will turn out. Sometimes I just have then not enough patience to wait until the thing ( in this case go live V8 ) happens. Because normally it turns out a bit differently then predicted ( I am working together with the risk department in a bank ;) )
Thank you, @Dutch. This again confirms my concerns that this just creates a higher barrier to entry. I think @scaletrix and @jefpatat are tone-deaf (no offense meant, of course; we can all agree to disagree) to the challenges we are currently facing with getting BOINCers to join: they don't want to join the pool. Why would they? A big component of BOINC is individual recognition and contribution and loyalty to your teams. Why would you go into the pool - a centralized resource - when you are trying to support a decentralized resource, be loyal to your team and help it move up the ranks, and still get credit under your own user name. If we're trying to do away with the team requirement, yet then forcing people over to the pool it's a self-defeating effort.
Therein lies the existing problem with GRC already: BOINCers don't like it because it disrupts the existing team framework, so we already have an adamant wing of the BOINC base against us. Why create an even higher barrier to entry now?
As others have painfully pointed out, it's already difficult enough to join GRC, so I'll just repost what I've posted before: I started to think about to when I started GRC. It was already a pain in the ass to get the wallet and blockchain loaded. Then I had to send a beacon and wait like 1-2 weeks to get my first payout - and that was after buying a couple thousand coins.
Here's what I see as issues based upon what I'm reading:
I think you need to reread what I said. I don't think we don't disagree. Also check my second comment in that direction.
Interesting article! looking forward for more @duch! i am following you!
Because of V8 and the fact that voting is also heavily favouring investors Gridcoin more and more changes from the coin that benefits humanity to another coin that only benefits preminers, early adopters and investors.
What are these preminers?
Some coins are mined by the creators at the very start, when there is no competition, before they are properly released. This way, the creators get a large, uncontested stake in the coin. It is generally frowned upon, especially when it is not properly disclosed.
Gridcoin was not premined.
Correct. It was not premined, I was there.
No idea why Kuradikurat downvoted you to hide your comment... Have a boost - you're telling the truth.
Ha ha I hadn't even noticed, thanks @dutch
There was no premine in Gridcoin & Gridcoin has been out for 4 years at this point, anyone could have invested at very low levels for years.
Besides, you're being overly dramatic - the changes are required for short term immediate security needs - there are improvements proposed which directly benefit POR users, this isn't some kind of attack on BOINC users.
I just thought of another side effect of all this. Suppose you're new. Just invested in HW and thus are unlucky and poor. You however will mine a lot of coins every day. Those will however only be received after six months ( or later if other proposals make it). What if in the meantime grc goes through the roof. Does that mean you lost that increase because the coins we're mined but not yet yours?
Good question, but no - you mine a specific number of coins, regardless of their price.
But you do not recieve interest on the earned coins until payout
That as well. On top of it.
Put it different. The value spikes. You don't have the opportunity to sell on the peak. Or the value goes down. No way to sell.
That is correct, unfortunately.