P2share: how to turn any network (or testnet!) into a bitcoin miner

The discussion centers around the comparison and potential benefits of a "pay per last N shares" (PPLNS) model when applied to Bitcoin mining, particularly through the innovative use of sharechain networks. If the parameter N encompasses all shares ever issued and a difficulty adjustment algorithm ensures each share represents a consistent amount of work, the model aligns closely with PPLNS expectations. This similarity is significant given PPLNS's prevalence and its alignment with the economic realities of mining, suggesting that a comprehensive adoption could prove beneficial in maintaining incentive compatibility within Bitcoin's mining ecosystem.

The introduction of sharechain networks under this model offers several notable advantages. Foremost among these is the ability to integrate additional functionalities into the Bitcoin protocol without altering the mainchain directly. This flexibility is attributed to the transferable and enduring nature of sharechain rewards or shares. Moreover, sharechain networks can function as valid Bitcoin miners, allowing for consensus changes that could influence or signal mainchain miner actions, potentially aiding in the coordination of upgrades while adhering to principles of trustless decentralization. While the impact of such signals might be minimal when sharechains contribute insignificantly to Bitcoin's overall hash rate, their influence could grow as these networks become more prevalent.

However, the proposal also acknowledges challenges and open questions needing resolution. The issue of spam on the sharechain mirrors that on the Bitcoin network, necessitating the development of effective anti-spam mechanisms tailored to sharechain nodes. The diversity of sharechains, ranging from those experimenting with new features to purely speculative ventures, introduces variability in the perceived value and stability of shares. Speculative sharechains, despite their inherent risks, are recognized for their potential to explore innovative features within the confines of the Bitcoin ecosystem.

Furthermore, the prospect of sharechain mergers presents both opportunities and complications. Mergers could facilitate the integration of valuable features across sharechains, provided there's compatibility in the units of work and a mutual agreement on the feature's implementation and activation. Despite the logistical challenges such mergers may entail, they underscore the potential for innovation within the Bitcoin ecosystem through decentralized avenues, maintaining the core protocol's integrity while exploring new possibilities.