isn't that the most important thing?
> work in PoW is it's output and the hashimoto algorithm in PoW discards all computed hashes that fail to meet the difficulty requirement
you've used few specific words in your comments: "work" and "product". i agree that work in PoW is hashing and most of hashes are discarded, but product of PoW is the signature that satisfies the difficulty. if finding the signature didn't require going through lots of energy - it wouldn't have been proof of work.
> If there are incentives to mining other than the block reward, the security assumption provided by hashrate majority is lost and blocks producers cannot be trusted.
amazing, so you do understand this and yet you keep saying PoW is wasteful. if security is the product of PoW, then PoW is wasteful only if security is worthless.
not really, consumption of energy is. and even if we accepted this weak statement, how does it follow that PoW is therefore wasteful? waste isn't the product of PoW, valid blocks are.
Yes. That's the "waste" part. The only product of spending the energy is a proof that the energy was spent. This is obviously wasteful because there is no relationship between the absolute energy spent and the utility of the network. The higher the difficulty the more energy wasted in order to maintain the status quo. Perhaps the most obvious sign of PoW's wasteful nature is the fact that the introduction of more efficient hardware into the network increases overall energy consumption because everyone else without cutting edge ASIC technology has to increase their energy output to compensate for the increase in hash rate.
yes, and if that proof has value - then it's not a waste!
> there is no relationship between the absolute energy spent and the utility of the network
of course there is - security of the blockchain is proportional top energy spent mining it.
> higher the difficulty the more energy wasted in order to maintain the status quo
you got this backwards, difficulty goes higher because more energy is spent (or there is breakthrough in mining efficiency like cpu->gpu, gpu->fpga, fpga->asic, see next paragraph). and miners spend more energy because market tells them it values the security / utility / w/e of the bitcoin more.
> introduction of more efficient hardware into the network increases overall energy consumption because everyone else without cutting edge ASIC technology has to increase their energy output to compensate for the increase in hash rate
this makes no sense.. introduction of more efficient hardware increases the difficulty, not total energy spent. inefficient miner will remain inefficient and not-profitable no matter how much energy they will be spending.
Proof of work is to establish that money is being spent. A less wasteful system wouldn't convert money into electricity to feed into computations to prove that.
Proving that you lit heaps of cash on fire would be less wasteful.
Just because a process is wasteful doesn't mean it isn't valuable. Air freight is wasteful but is also valuable.
nope. it's a proof that energy was consumed. money is human concept, energy is universal absolute.
> Just because a process is wasteful doesn't mean it isn't valuable
energy consumption is inherently wasteful activity (as in there is some amount of "waste" in the world produced for the energy to become consumable). by this definition literally everything is wasteful and the label loses it's meaning.
but labels are useful and i (and the official definition) prefer using the term wasteful for something that is intentionally or unnecessarily inefficient.
bitcoin is neither - every joule spent mining bitcoins is necessary to provide the level of security demanded by the market. you can't spend less energy to provide same level of security, because in bitcoin they are pretty much the same.
Bitcoin mining is wasteful, it literally produces waste, and there is no proof at all that it is an optimal way if achieving security, in fact I feel there are signs that point towards the contrary.
you're missing the fact that bitcoin difficulty adjusts. ultimately bitcoin mining is an activity that converts energy into blockchain security. market establishes the required level of security by assigning value to bitcoin. if you replace bitcoin algorithm to anything more "efficient" - it will simply mean that miners will churn through more iterations of hashing but amount of energy consumed will not change because it's dictated by the market.
> Bitcoin mining is wasteful, it literally produces waste
wrong. bitcoin mining produces blockchain security. waste (and more correctly - energy consumption) is just the mechanism.
My metaphor was intended to show you that with innovation we might find better alternatives that have similar or better value, at lower cost. It could be that we can get the same or similar security Bitcoin offers, but without the cost of the enormous energy expenditure.
all consumption of energy produces waste, the question with lightbulbs is whether we can get more light with less energy and certainly from 100 years ago there was lots of progress.
the same question simply doesn't apply to PoW currency, because energy expenditure is the goal since it directly converts into security. you can't ask for more security with less energy if security is defined in terms of energy. and that's exactly the case with bitcoin.
if you want your metaphor to work - imagine a lightbulb that has a dimmable enclosure and it automatically dims proportionally to how many lumen is emitted so that luminosity of the whole device is constant. no matter how much energy you throw at it or how efficient you make the lightbulb - the apparent outcome is the same, therefore there must be something else this process gives you to justify expending this or that amount of energy.
The concept of a useful PoW algorithm has been debated a number of times and the consensus view is what I wrote earlier: If there are incentives to mining other than the block reward, the security assumption provided by hashrate majority is lost and blocks producers cannot be trusted.
I'm a blockchain developer for a couple of years now, and I often write about it as you can see by the links I shared above.
(edit: typos)