1:19 AM
@rapt The article talks about long-term governance of a sysytem. Bitcoin does not use PoW for long-term governance and bitcoin's long-term governance (just like all public blockchains) works more or less the way that article explains. PoW solves a different problem for bitcoin.
The real stakeholders of bitcoin run code that uses PoW to produce consensus on which blocks to add to the blockchain because they believe that this provides censorship resistance over the short to medium term.
If it stopped doing that, the users would likely force a change in the PoW algorithm or a switch to PoS or something like that. But that would bankrupt the current miners, turning their expensive ASICs into space heaters (a bit faster, anyway).
So PoW incentivizes miners to produce blocks that keep the stakeholders happy from hour to hour because the miners must keep the users happy to keep their mining profitable.
It doesn't handle long-term governenance. It just gives the users peace of mind that over the short to medium term, they will keep getting reliable, censorship-resistance blocks produced free of deep reorganizations.
The miners get paid huge amounts of money to do this.
Discussion on answer by David Schwart…
Discussion on answer by David Schwart…