Sounds like a free rider problem.

It has to be a cheap enough solution that the majority of the population can join but it has to cost enough that it is a barrier so smammer can't afford to spam..

All while, you have to make it simple enough for the masses.

That's where the relay problem comes into play. It's too confusing for the masses. I don't understand what half of these relay buttons do on Amethyst. I've seen the question asked multiple times but never seen it answered.

I've signed up for a paid relay but not sure of the full benifits of that are.

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I agree. We have a lot of work to do to make everything simple and easy for the average user so it's not confusing. If people want the benefits they need to put a little effort into learning how things work (just like they had to do with their cell phones and the Internet), but the devs should do our absolute best to make that learning curve as small as possible.

What if clients start to be small relays themselfs? Is this technically possible? This way everybody using it contributes. Something like what ipfs does with files.

That's certainly possible for a peer to peer network as opposed to the current federated relay network. I'm in favor of that for clients that replace apps like WhatsApp. But devices like phones don't have the CPU or bandwidth to handle what relays are doing for the general social network. P2p also has poor performance in comparison, so pulling down large feeds like people do now would be a bad user experience. But again, I'm all in favor of a Nostr-driven WhatsApp replacement!

Proof of Work was originally meant to solve this problem, not the Byzantine Generals problem of transaction finality across decentralized participants.

It was a spam prevention proposal. Require someone prove they're a normal user with limited activity by doing a quite large amount of work that wouldn't bother a normal person making 1 post per minute or so. The problem is that this seems to be a phone first ecosystem and work is hard on a phone's battery.