I see proponents of Bitcoin always mention comparisons to the entirety of the finance industry, but I've yet to see numbers back that up? All we can see right now is that Bitcoin uses more power per transaction. Comparing it to the entirety of the finance industry is perhaps taking the physical presence of the industry in to account, but do people assume a crypto future would be completely digital? Would you have no need for finance buildings for in person consulting etc? Perhaps. But that's several leaps of faith. If Bitcoin somehow took over the entire financial industry, would it be more power efficient than it is today?

You then compare it to the power use of all internet services. This is another comparison that proponents of BTC often make. However the use of internet has tangible everyday benefits. What is the tangible benefit of BTC today that can outweigh it's power consumption?

> I see proponents of Bitcoin always mention comparisons to the entirety of the finance industry, but I've yet to see numbers back that up? All we can see right now is that Bitcoin uses more power per transaction. Comparing it to the entirety of the finance industry is perhaps taking the physical presence of the industry in to account, but do people assume a crypto future would be completely digital? Would you have no need for finance buildings for in person consulting etc? Perhaps. But that's several leaps of faith. If Bitcoin somehow took over the entire financial industry, would it be more power efficient than it is today?

The irony with this argument is that Coinbase, Binance and other exchanges are all part of the "finance industry". The elusive "finance industry" will always consume more energy, by definition.

Non-State backed, Global, trustless, bearer instrument, censorship resistant store of value that can be transmitted over a communication channel.

If you don’t understand why this is valuable now, you don’t need such a thing. One day you might...

Not everyone dreams of ancap utopias.

Most economists don't believe in unregulated markets anymore. Somehow this message hasn't found its way downstream.

Everybody can understand crypto's role for illegal transactions and tax evasion. Not everyone sees a value there. And really, this is not down to Bitcoin in particular.

I am one of those early Bitcoin adopters who was turned off by energy consumption.

Crypto is cool in a theoretical sense but ugly in practical sense.

I mined a bit of BTC in 2011 and LTC in 2013 but when my colleagues started buying ASICs in 2017 boom I could not in good faith join them because of energy concerns. (incidentally buying ASICs is a losing proposition unless you get early access)

The problem is that if BTC goes to say 500k the incentives for power (ab)use get even more perverse.

POW is just like Adtech and HFT. Some Adtech and some HFT might be okay but at some point it becomes an arms race no one can win.

I am not up to date with the latest developments. Is POW, as in blowing away heat, fundamental to all coins? Is there such a thing as "Proof of Service", or "Proof of Meaningful Work"? Tho, I assume everything can be exploited by twisting it into meaningless, but more competitive "work", coming down to just generating heat...

Furthermore, the only people who have control over the energy consumption of the mining network are the bitcoin miners. They have extreme amounts of attention directed at energy efficiency. Miners are thinking about electricity costs very often as it's the base cost of operation.

There have been many step changes in efficiency. On a per-hash basis (and security of the network is directly proportional to number/difficulty of hashes) I'd estimate the efficiency of bitcoin mining has increased a million- or even billion-fold in the last decade.

Miners are making their decisions based on the price, which is set by the market: the amorphous sentiment of a crowd of millions of strangers. The price of bitcoin is directly proportional to the rational amount of energy miners should expend mining it.

There is no "make it more efficient": it's already being pushed to be extremely efficient all the time. That you believe bitcoin is not efficient enough is irrelevant and probably unfounded. The market likes it, and you're yelling at the market about efficiency, but the market already decided what the rational amount of electricity to expend securing the network and settling transactions based on the current price.

The only reason you think it's using "too much" energy is because you don't understand the security value of chained hashing.

The problem with that argument is that the greater efficiency will just drive for harder difficulty, and thus require more hashing per payout. Ultimately the power consumption will always regress to the total payout divided by the average electricity price no matter the efficiency of the miners. Some different non-mined altcoins don't have as much of this issue and I wish they were more popular/more people tried to figure out how to make them work better since they still seem to be in their infancy due to the other attacks they are vulnerable to.

Recognising the cost and quantifying it doesn't need to target the BTC users. It can target regulators for example. If we don't keep bringing the issue up, does the issue exist? Should we also stop taking about climate change since we won't change the minds of people running coal mines?

Even without a call to action, changing overall sentiment can influence action in the future.

> Does anyone have an amount of power consumption reduction that they think would make Bitcoin use justified for the functionality it provides?

Close to 100%, given PoS coins exist. Especially once ETH and other larger communities migrate.

> I see it as just a method to mollify the insecurities and regret from not recognizing that Bitcoin was going to be valuable back when they first heard about it.

I don't like Bitcoin, precisely because it's just a deflationary currency. The fact that deflationary pressure drives energy consumption higher is just a nice bonus on the list of reasons why Bitcoin shouldn't exist.

I've gone from liking bitcoin to thinking it's failed at its goals (not because of its energy consumption) to thinking it's actively harmful because of the energy consumption. To give you an idea: the entire energy consumption of the finanical industry (including servers, offices, etc) is in the same order of magnitude as the energy consumption of the bitcoin network. The financial system which runs most of the transactions in the world, many services which could not even in principle be replaced by bitcoin, is the same as bitcoin, which can do at best 6 transactions per second of a single token.

It's woefully inefficient, and worse the incentive structure doesn't intrinsically actually align with what's needed to keep the network safe from double-spend attacks. At the moment the income from block rewards from mining (combined with bitcoin's price) is entirely what's driving the energy usage of bitcoin, while what's actually needed is enough proof of work done that a double-spend attack is unprofitable. There's no intrinsic reason these two values are linked: at the moment the energy usage is extremely high, probably far higher than what is needed to secure the network against an attack, but when block rewards decrease in the future, the energy miners are incensivised to spend to get the block rewards will inevitably sink below the level needed to protect the network. The only saviour would be if transaction fees can cover this, but even now with transaction fees being almost irrelevant (<10%) of the miner's incentive, the transaction fees are untenably high for any use as a currency. They would need to rise to $140 or so to break even. This makes the idea of bitcoin as a cheap 'store of value' extremely questionable in the long run, since it is a store of value which requires a constant maintenance by the expendature of energy, which only grows as the value stored in it increases (while an adversary only needs to expend the necesary energy once to pull off an attack). The only way bitcoin could sustain a healthy level of proof of work would be to continuously provide enough value as a transaction medium to justify the cost, and with the current bitcoin that isn't going to work, while at the same time it has basically become fossilised with extreme resistance to any change to the protocol which would provide this.

I think there's a lot of potential value in cryptocurrenies as a concept, and if etherium manages to successfully transition to proof of stake I think it could be in a position to provide that at a reasonable cost, but bitcoin is not it and the position it occupies both crowds out better ideas in the cryptocurrency space as well as being net negative value to humanity as a whole (though it certainly is making some individuals and organisations rich).

Also, lets say in the near(-ish) future we get "unlimited", very, very cheap energy. Something like fusion power. Wouldn't that mean the Bitcoin network would incentivize a burn rate until some resource scarcity is reached again, inherently? Couldn't energy even become so cheap, other resources will become the limit and therefore completely cripple humanity's prosperity?

Indeed, the design of bitcoin assumes energy is limited. Either it becomes a self-fulfilling prophecy (though if bitcoin starts approaching half of humanity's energy production I expect it will get shut down hard by governments), or bitcoin breaks when it becomes sufficiently available.

Though there is also another factor which limits mining: the availability of hardware. This cost is not negligible in mining profits, and in fact is one of the reasons the idea of miners using excess green power is a myth: mining hardware generally needs to be run close 100% of the time to make a profit.

> Though there is also another factor which limits mining

That's what I meant when I wrote, mining may be limited by another resource limit. I dread a future, where technological progression is halted or slowed, because people need to dig into landfills searching for rare elements bound to overproduced electronics.

Look at all the compute thrown at heat generation instead of solving protein folding problems for all of humanity. What could be done with terawatts of electrical energy?

I think prolonging the usage of Bitcoin isn't stupid, but downright offensive. Your freedom ends, where my future begins.

>If you saw a website that showed the power consumption of all internet services, would you find that to be a compelling reason to change the way you interact with the internet?

Would be interested to hear this across all tech really, e.g what's the environmental impact of say videogames I mean they're running machines at full pelt too for hours a day for millions of people.

The energy consumption is ugly though. I could see a drift towards proof of stake such as Eth 2.0 to avoid that. Maybe individual investors don't care but the institutional investors the bulls are hoping for are going to be pressured by environmental groups.

The entire PoS movement is driven by people who like cryptocurrency but don’t like the power use.

I think bitcoin is evil and have from the start. A unit of exchange cannot replace any significant fraction of the financial system, it is crazy to suggest this. The energy use required to run bitcoin is first reason I consider it bad. The second is that I feel the ethos of bitcoin is naive and antisocial.

Great comment, it articulates something I’ve had on the tip of my tongue but couldn’t express.

Energy usage itself is not a bad thing, it’s the energy source that can be environmentally problematic.

Currently 39% of mining power is driven by renewables [1]. It’s not much but a good start.

The simplest solution to speed this up would be to create a law requiring that all mining must come from renewable sources (or at least tax those that don’t). It would drive innovation, jobs, and make locations with renewable sources competitive places to live.

[1] https://www.jbs.cam.ac.uk/faculty-research/centres/alternati...

The energy usage of itself is a red herring.

My issue is just how incredibly wasteful and inefficient PoW is. It's resource requirements completely disproportionate to the the underlying problem/solution space.

It offends my sensibilities and aesthetic appreciation of elegance in design. It is like contemplating a trillion record bubble sort.

I'm not a fan of the economic incentives of Proof of Stake. Are there any new alternate proof systems that have been developed recently?

Hard to see the interesting projects in such a crowded field of crapcoins.

How are the economic incentives of Proof of Stake any different from Proof of Work?

The fundamental problem is that with PoS it's possible to dispose of your holdings yet still retain voting power (in the past, from the blockchain's perspective), whereas the same can't be done with PoW's mining equipment.

With PoS, withdrawing your stake (read: disposing of your holdings) withdraws your ability to act as a validator. And pretty much every mainstream PoS implementation imposes a delay on stake withdrawal to give the rest of the network time to make sure that whoever is withdrawing their stake hasn't already validated fraudulent transactions.

That's still fundamentally a weaker system, no? Specifically, still possible to double spend, the only difference is that we assume that the network wouldn't accept block re-orgs that are that long.

It’s the most secure way to do it, which unfortunately requires the most energy... I have gone back and forth when considering PoS but fact of the matter is, PoW is the most secure today. Doesn’t mean there isn’t a better solution, so I totally agree that we need to try to find ways to trim the energy cost.

Regardless of where the energy comes from, it would be better spent on desperately needed carbon capture.

There is currently a $100 million prize out there. That should help a bit?

That's just for R&D. You still need a culture and policy that rewards deploying carbon capture on large scales.

Interesting stats in that citation. Hydropower dominates in the renewables category and North America has the highest regional share of renewables powered mining.

FYI, hydropower has a fixed capacity due to obvious limitations, namely viable rivers to dam up. There is basically no option for hydro expansion left on earth. In that light, I think the "sustainable mining" argument is pretty flawed. We can't scale hydro- and geothermal power, but we need it for base load in a sustainable future. It's the worst energy resource to occupy.