Bitcoin's addiction to dirty coal killed between 1500 and 15000 people last year.
To process 4 transactions per second.
In a few years Bitcoin mining will kill way more people than the number of political dissidents it could hope to save through the magic of decentralization.
[edit] Energy is not free people. Not even renewables. Making electronics isn't free. E-waste isn't free. This isn't WoW.
[1] https://ccaf.io/cbeci/index
[2] https://www.statista.com/statistics/494425/death-rate-worldw...
[3] https://www.nextbigfuture.com/2011/03/deaths-per-twh-by-ener...
It sucks that bitcoin uses so much power, but these countries using fossil fuels would still use them with or without bitcoin mining. We need to keep the pressure up to get these countries (and our own) to convert to 100% green renewable sources.
Right now China has only promised to reduce its fossil fuel to 20% of its total energy use by 2060, which is still 38 years away and way too late. In fact they're planning to keep INCREASING fossil fuel use up through 2030!
"China is targeting a clean energy goal of reducing fossil fuel use to below 20% by 2060, according to an official plan published by state media."
"The cabinet document, released on Sunday, follows a pledge by President Xi Jinping to wean the world’s biggest polluter off coal, with a target of peaking carbon emissions by 2030 and achieving carbon neutrality 30 years later."
There's no bitcoin mining in the country now to use it as a scapegoat either.
[1]: https://www.nytimes.com/2021/09/27/business/economy/china-el...
[2]: https://www.theguardian.com/world/2021/oct/25/china-to-cut-f...
No, but banning the miners meant they didn't have to build a whole pile more.
"Heartbreaking: The Worst Person You Know Just Made A Great Point" - they have the moral high-ground on this issue.
> Right now China has only promised to reduce its fossil fuel to 20% of its total energy use by 2060.
Sure. And it would have been a smaller reduction had they not kicked out the miners. This waste is purely additive.
I wasn't arguing that it was a bad thing that China banned bitcoin mining, just that banning it didn't reduce fossil fuels at all (maybe slowed down how fast they expanded in the future, sure). And they're still planning to build 43 new ones[1] in addition to what they already have.
So now what? Can't ban bitcoin mining in China twice. How are we going to get them to reduce emissions now?
> "Heartbreaking: The Worst Person You Know Just Made A Great Point" - they have the moral high-ground on this issue.
You are neither the worst person I know, nor did you make a great point, nor am I heartbroken. Thanks for the snarky reference to a Clickhole article[2] that's just a slight sidestep from an ad hominem attack.
I also don't know who you mean by "they" or what moral high ground you're referring to. I already said it's shitty bitcoin used this much energy this year, and also what percentage was generated by fossil fuels. But it's not the only reason the world is still using so much fossil fuels, and energy demands around the world have been increasing rapidly even if you take out all of bitcoin's usage. Most of that is driven by economic growth in Asian countries[3], not bitcoin. You want those countries to ban economic growth too? How are we going to do that? Hell, how's anyone going to get the political will to do it in the U.S.?
For the record, I'm all for degrowth worldwide to help reduce the looming climate/biodiversity/water catastrophe, I just don't see how it's going to happen. Pretty sure we're doomed to have a major collapse forced upon us by the world in the next 20-30 years.
[1]: https://time.com/6090732/china-coal-power-plants-emissions/
[2]: https://clickhole.com/heartbreaking-the-worst-person-you-kno...
Indeed, they have a lot of work ahead of them. I will not disagree. I'm hopeful their huge push towards nuclear power will help them bridge the gap. They are one of the biggest sources of carbon emissions and all sorts of other pollution in the world.
> You are neither the worst person I know, nor did you make a great point, nor am I heartbroken. Thanks for the snarky reference to a Clickhole article[2] that's just a slight sidestep from an ad hominem attack.
I sincerely apologize, but that wasn't directed at you! The heartbreak was mine, and the "worst person you know" was directed at the PRC government. I was implying that while they do not have a particularly stellar track record in the ethics department, in this case, they made a good (TM) choice.
I suspect our positions are closer together than they are far apart.
Its energy and resource consumption cap is proportional to its unit price times block reward. For the foreseeable future, as long as number go up, consumption will go up. And this is the most critical time for climate change in our lives. Any green energy we generate must go to displacing carbon-intensive processes or we'll be trading bitcoin for citrus from rafts on waterworld.
The worst part is, once we run out of block reward, there's no guarantee people will be willing to pay enough per transaction to actually secure the network to any meaningful degree, so all this resource consumption today may well be for nothing.
You may want to examine the logical flaw behind this line of questioning.
"You don't think we were using lots of water in this house before I decided to take a bath today?"
How are you counting the number of political dissidents saved?
Bitcoin is not the tool you should be using for that. It's just poor opsec.
* https://www.coindesk.com/policy/2020/09/09/belarus-nonprofit...
* https://www.coindesk.com/tech/2020/10/16/nigerian-banks-shut...
* https://www.coindesk.com/policy/2020/07/15/russian-activists...
Credit networks ran 468 billion transactions in 2020, so that would be 60 million dead.
"Pobody's nerfect" hardly seems like the right response.
The rate of new renewable energy sources created because of bitcoin is higher overall than without bitcoin.
[1] https://e360.yale.edu/digest/bitcoin-miners-resurrect-fossil...
Nuclear is dirty? How?
With breeder reactors we can cut that down by several hundred times - it’s just that uranium is quite abundant and very energy dense so we haven't really bothered to.
Further there’s a few billion tons in the ocean we’re working on extracting.
If we’re willing to accept extracting rare earth metals from Mongolian hellscapes like Baitou and calling wind green, it’s pretty disingenuous not to extend the same treatment to nuclear. [1] There is no free lunch.
[1] https://www.bbc.com/future/article/20150402-the-worst-place-...
And the fact that the current death toll stands at 1 (likely to increase though) and Fukushima is perfectly habitable now (and has been for a while now). Almost 20000 people died due to the earthquake and tsunami. Only 1 due to the nuclear disaster.
Fukushima disaster should be a footnote in history. It’s not a valid representation of safety of nuclear power.
As a European, I’m far more concerned about the dependence on Russian natural gas (Germany completely abandoning nuclear; Nordstream 2) than I am about a reactor blowing up.
An observation from 2018:
> imagine if keeping your car idling 24/7 produced solved Sudokus you could trade for heroin
It’s only unstoppable within the game theoretic model of crypto itself, not within the larger societal context. Once Bitcoin power consumption enters the common discourse, my guess is that politicians will step in and simply outlaw PoW systems. There is no real downside for politicians. The average voter hasn’t yet invested their life savings into Bitcoin, and once PoS systems exist at scale proponents can’t use the innovation argument anymore. Especially in Europe, politicians are serious about climate and are pondering much more draconian changes than outlawing some forms of crypto.
If you don't like that people run computers to play games or wash laundry or watch videos or hash strings, re-pricing electricity fixes that. Germans are experiencing this experiment with increasing electricity prices right now.
Code is speech. Running it is not.
Will we? I am not convinced. In the pandemic, many countries weren't even able to efficiently mandate masks or vaccines, despite the fact the majority supported these measures. The libertarian-anarchy minority is very loud, and will fight the right to Bitcoin tooth and nail.
Not everywhere, and likely not in America. In Europe it’s not as unthinkable. Climate regulations are having real impact on people’s lives, and yet there is support for them. Spun by the right politician as a ‘free’ savings of XX megatons of carbon, outlawing PoW would be an easy sell. And with a massive bloc like Europe not participating in a certain crypto will definitely reduce the global attractiveness of that crypto.
I don’t have a crystal ball and of course I can’t say this will definitely happen. But I think it’s plausible.
Mask regulations in the parts of Europe that I’m familiar with were largely followed.
We recently had a conversation discussing the fact that we could eradicate hunger and the need for clean water globally, but for a whole host of reasons we have not yet done it.
He continues to probe “why“ and all I can say is, essentially, because people are greedy and unmotivated generally, and unwilling to sacrifice a modicum for others (not to mention corruption and other collective action problems).
I don’t think there is an answer.
It depends at what level you mean ‘could.’ Yes, agro-technically we can produce enough food to feed everyone. The issue with world hunger is mostly due to non democratic governments preferring power over feeding their people. At that level, the ‘could’ becomes difficult and maybe impossible.
I think the real answer is that human nature has a dark side that, unless kept in balance by a culture of accountability, will cause harm to others.
A related realization is that, I think, cultures of accountability can be traced back to just luck and a small number of enlightened people that set things up in the past at the right time in the right place. So let’s not pretend things will always get better automatically, and, for those who enjoy freedom under a democratic government, let’s make an effort to cherish and invest in our culture, starting with educating our kids how special this really is.
All you need to do is tax the rent seeking and it goes away. The reason why that hasn't been done is that those who would be impacted have good connections with elected politicians. The most humble example is a homeowner who is involved in local politics at the expense of the renter.
I agree with your sentiment but I have to disagree with that phrase. The vast majority* of people of people pay quite a lot of money in taxes, which ostensibly** only exist to help others.
(*) I know the billionaires have their wealth as unrealized gains; I chose my words carefully
(**) I know we all disagree on how that revenue should be spent, but the purpose of taxation is all the same
The purpose of income tax is to avoid taxing land. You're basically paying taxes twice. Once to the government and again to the owner of the land who is making a profit off the services your government has provided via income taxes.
Also, almost all welfare systems are designed to make poverty sustainable, which is why simply getting rid of them solves nothing, they are just a symptom of an unequal society that wants to keep it that way. Getting people back to work is a more effective way to reduce welfare than cutting welfare spending.
E.g. farmers get paid by welfare recipients, cutting welfare may end up costing farmers a job that is absolutely necessary to society so farm subsidies are increased to maintain food security. If people get a job they still need to eat, so getting rid of the farmer and all the other people that are getting paid via the welfare recipient is nonsense.
That they use as collateral to get loans from banks that actually have that money. "Billionaires don't actually have that money" is peak bootlicker logic.
A house mortgage with 20% down is designed to be undercollateralized.
When the regulators and debt rating agencies don't do their jobs, it is easily apparent those loans were not fully collateralized. Therefore, the loans created money out of thin air. The banks are licensed to print money.
It doesn't matter if what your bank gives you isn't paper money. That's not the point. The point is, you go to the bank, you can buy absolutely anything you want with your loaned money, even if it's just a line in a database called fake_money_literally_just_printed.
If government was moderately okay at setting prices and production, there would not have been starvation of tens of millions under Mao's rule. If government manipulation of production worked, today North Korea would be the bread basket of the world.
It's the same issue we're now running into with renewable electricity production: You either need lots of storage, and for what you cannot store you need to significantly overbuild your production capacity.
The original question was why can’t we just feed everyone.
I wouldn’t say it’s “the answer” but it is “a candidate answer”
There's a video on this subject - Can YOU Fix Climate Change? https://youtu.be/yiw6_JakZFc
You may also like A Selfish Argument for Making the World a Better Place – Egoistic Altruism https://youtu.be/rvskMHn0sqQ
source: a person raised in the fictional "we" whose neighbors were not
Dyson spheres and stellar engineering to power cryptocurrency mining rigs.
I shudder at the thought.
Another storyline I came up with is this: Imagine that an alien civilisation has the ability to send electromagnetic signals faster than light by some mechanism such as a micro wormhole but not ships and such.
They still want to destroy other civilisations before they become a threat. They are able to connect to some unsecured wifi networks and start posting on forums. The username: Satoshi Nakamoto
- that this is not technologically possible with current or future tech
- no one would possibly do something this stupid
- it is nearly 100% certain that our universe exists in someone's hair-brained web3 Ponzi scheme
Not sure whether I should welcome my simulator overlords or search for weaknesses in Bostrom's argument.
Considering Humanity's capacity and even drive for destruction (entropy incarnate, that's us), by having handed us this concept they will have certainly accelerated the destruction of potentially hostile civilisations... but also their own, the rest of the universe, and whatever surrounds it.
There is some really good fiction to be found in this vein on https://old.reddit.com/r/HFY/
Economics 2.0 in the later third of the story.
> Welcome to decade eight, third millennium, when the effects of the phase-change in the structure of the solar system are finally becoming visible on a cosmological scale.
> There are about eleven billion future-shocked primates in various states of life and undeath throughout the solar system. Most of them cluster where the interpersonal bandwidth is hottest, down in the water zone around old Earth. Earth's biosphere has been in the intensive care ward for decades, weird rashes of hot-burning replicators erupting across it before the World Health Organization can fix them – gray goo, thylacines, dragons. The last great transglobal trade empire, run from the arcologies of Hong Kong, has collapsed along with capitalism, rendered obsolete by a bunch of superior deterministic resource allocation algorithms collectively known as Economics 2.0. Mercury, Venus, Mars, and Luna are all well on the way to disintegration, mass pumped into orbit with energy stolen from the haze of free-flying thermoelectrics that cluster so thickly around the solar poles that the sun resembles a fuzzy red ball of wool the size of a young red giant.
... Thats your utopia? How about we figure out a way to store/transfer wealth which doesnt need to perform arbitrary calculations and cause massive power consumption
Bitcoin investors expect the people of the future to work for them even though they made no such agreement.
We do need a military to enforce our borders from illegal invaders.
Does heat dissipate well in vacuum? Won't having it so close to the sun result in more heat? I guess the only way to dissipate so much heat would be via radiation. Outer space seems to be really really cold so that might help.
The mechanics of heat sinking in space is amazing and terrifying.
The 16-minute round-trip delay would wipe out any energy benefits, for bitcoin. Maybe you could come up with a consensus mechanism which allows people to somehow amortize recent calculations, though.
Isn't that exactly what pooled mining is all about?
My utopian idea is crypto fund with the sole purpose of hiring assassins and special operations squads to eliminate biggest mining data centers and holders. Every successful hit would inflate its own holdings thus fund further raids.
I know this is pedantic, but the competition is about computational power. Energy is a significant input. Let’s not ignore the benefit that the more computational power that is spent in the competition the more secure the blockchain is from 51% attacks. Maybe 134 TWh is too high of a price for such a limited use technology such as bitcoin. Maybe we could do the same or more with the less energy intensive PoS technology that ETH 2.0 will bring to the mainstream. Blockchain is the single largest threat to banking, and that doesn’t come without a price.
That's an interesting statement. The first question that occurred to me was: Why does banking have to be threatened? In other words, is this a solution looking for a problem?
A lot of people I know working in crypto saw their families hurt badly by that crises and will happily spend their lives trying to build something else (even if the odds are stacked against them). They protested at OWS and saw little political will for change.
Eventually we are left with the question: Do we just sit around voting every few years for another colour to be in charge, or do we try build something else, maybe it’ll work, maybe not, failure is ok we already live in a failed state, maybe all we need to do is threaten the existing political/financial institutions so that they do things differently or risk irrelevance. Who know. Trends and forces.
Given time, things were nowhere near as bad as you could have been forgiven for thinking at the height of it. But the risk created by the fact nobody knew that caused the credit “crunch” and liquidity to dry up, and while banks were bailed out and recovered, the downstream impacts were horrendous.
That scenario simply isn’t possible even with the craziest, risky-as-shit defi protocols. You can see how much is at risk in every contract for every address, reports could be built automatically, and the risk is defined by the code, there is no ISDA agreement or OTC contract that might cause someone to come along and say you actually owe a bunch more money than you put at risk, and every cent (or satoshi, or whatever) of collateral is accounted for.
So it’d have helped a lot. Albeit the whole financial system would look quite different to how it does today (that’s the goal!).
Also, although the general principles are good and the primitives are increasingly in place, the protocols (financial products) in defi are mostly still “toys” and not, for the most part, ready to replace the current system. There is no technical reason why they can’t though, and progress in that direction is happening even if a lot of defi doesn’t make it look that way.
I think a key idea to pursue is how we could provide privacy for individuals and transparency for institutions/corporations.
And I think it’s important to try ideas. Try something, anything. Accept that most things will fail, that 90% will be shit. Break things, take things apart and rebuild them, remake old ideas anew. Take the same energy i have to getting mods to run in a game, or monitoring the rain in my garden and doing it to money and banking and lending, community currencies, universal basic income, trust networks, etc.
That’s not to say don’t be critical, there is a lot to question and weird speculation(imo a result of the abusive financial system we live in, it didn’t just appear with crypto) but hackernews could do with more hacker mentality on crypto imo. It’s a massive design space for people to try out their ideas for money and debt and gift giving and public services and taxes and where digital worlds and communities meet real world politics and institutions and economies.
I’d like it if my bank was hentai death metal themed not hsbc blandness. And that I can build my own savings account logic on top of it that automatically sends half the profit to animal charities. I’d like to be able to spin up an instant bank account for my new guild of strangers around the world at the click of a button so we can share materials and grow together. I’d like my money to be pictures of dogs not pictures of a president or queen. I don’t think these ideas are silly, dangerous, or impractical. And it doesn’t require the permissions of tradfi. Just public and private keys. Wild.
Once a set of “trusted” actors can issue debt, you have monetary expansion.
In Crypto, we have Coinbase, Binance and Tether - the defacto crypto banks. They have the ability to expand the crypto money supply and promise IOUs multiples in excess of their true deposits.
The success of these centralized exchanges ought to give anyone pause with regards to how truly decentralization crypto really is.
Regardless, defi exchange won’t stop monetary expansion. People with a currency will want to gain a return on those currencies, since they don’t do anything productive sitting in a wallet. Therefore, banks would emerge with deposit accounts who would then lend out loans in excess of deposits. I don’t see a defi way of doing that which would replace institutional banking, because individuals and algorithms are not equipped or financed to analyze the lending risks, fraud, take legal actions, etc..
2008 was caused by starting with undercollateralized loans enabled in part by fake rating agency ratings, and failure of regulators to regulate. That system failed and the backstop FDIC can only write checks up to around a 3% failure.
USDP appears to be the most sound, with USDC after that. You may use any of those or none of those or make your own. You are free to choose. Your body, your choice.
To be clear, banks did not cause the 2008 economic implosion. If you run through root cause analysis, what comes out on top as the trigger event for the avalanche was US politicians distorting markets through legal action that enabled giving mortgages to people who would have never been able to buy a home otherwise. Sounds altruistic, yet, in reality, it ended-up being a destructive force. I remember a documentary where they interviewed various people who bought homes around that time. This one woman worked at McDonalds, essentially made minimum wage and was able to buy a $500K home due to laws that allowed such distortions as "no docs" loans with full federal guarantees.
That and other legal components that eventually resulted in the creation of derivatives where banks could package small fractions of thousands of mortgages into investment vehicles. The game, then, was to write mortgages, slice, dice and package them into CDO's and sell them as quickly as possible at a profit.
Sure, one could blame banks and investment firms for this. No doubt. However, I think the important element to understand here is that, if the government tells you that, not only it is legal to do these things, but they actually want you to --because they want everyone to own a home-- well, what do you do?
Not a good analogy, but, on our roads we have speed limits set by government action. Around where I live it's 65 miles per hour. People drive anywhere between 60 and 80. Lots of people (most?) drive well above the limit. In other words, there's an argument that says it is human nature to push things a bit. Absent enforcement, some people would drive 100+ on a regular basis.
The genesis of the 2008 crisis is related to the removal of financial speed limit signs by government. Not only that, they also effectively said "we want you to drive at speeds we all know are dangerous and irresponsible". Politicians got votes when people were happy because they could buy homes. When the house of cards they created collapsed, we all ended-up paying for it.
I don't blame banks. There is no way in hell 2008 would have happened --no way-- without government removing the speed limit signs. This business of buying votes with handouts has destroyed many countries. The 2008 economic implosion was just one example of this. Latin America and other nations have lots of examples in their history of governments using money and economic policy to buy short-term happiness from the masses in exchange for votes...only to drop them on their heads after the fact.
The fundamental problem is the belief that money is a thing that can be owned and stored when in reality it is just a relationship or a contractual agreement among humans.
The fact that you can own cash and get a guaranteed 0% interest rate even though nobody has signed that contract. E.g. nobody promised that you will get exactly $1 of value in the future. The 2% inflation target is just an expression that this idea is flawed from the start. Think about it this way. The inflation target reduces the effective interest rate that cash holders can demand without anyone agreeing to them receiving 0% interest.
What I am getting at is the fact that everyone, including the economists, assumes that money should be nominally durable. Money is not durable in real terms. It's a market distorting fallacy.
If we assume a barter economy with the option of having money denominated loans but no way to "own" money via cash then interest rates would be dictated by supply and demand and nobody would find it strange that interest rates could be negative when there is an oversupply of grains as the excess grains start spoiling and a negative interest rate could still be more profitable than the spoilage of grains. It's only once you introduce cash, that people perceive the right to pass the cost of spoilage onto everyone else as god given.
Now lets go back to how the modern money system actually works. You go to a bank and you basically promise payment (e.g. through work which ultimately boils down to your time) known as debt to the bank. The bank grants liquid credit which is basically a divisible claim to the debt and thereby a claim to your time. So money is an accounting system for abstract time/labor units.
Well, the unemployed still need to eat and they still need a place to live in. If we are going to be very cold hearted we can call these the storage costs of labor. If you don't pay them, your labor is gone (person is dead). Money lets you pretend that this is someone else's problem, e.g. the government is supposed to take care of the labor (welfare) that you haven't decided to utilize and keep maintaining it.
It's only logical that your money becomes worth less over time (if you assume it is durable). Keeping something in pristine condition requires an external energy input.
Okay, now onto the actual point I am trying to make. The assumption that human needs are endless is wrong, it was only true on a societal level because of endless population growth that is massively slowing doing. Human needs are no longer growing as fast as they used to. There are very few growth opportunities left that let you paper over the inability to express negative interest rates. This also means that the need for investment is going down significantly. Markets are starting to become saturated. Almost nobody but the government is borrowing anymore and this borrowing is meant to raise the interest rate above zero through fiscal stimulus.
If you are a company and you expand production in this environment, then your additional capacity will not earn a profit and even currently unused production capacity is becoming a drag to the economy as it requires staffing and periodic maintenance. Strictly speaking, there is more financial capital in the economy than there are investment opportunities. If saving and investment are balanced, then interest rates must be at 0%. If there is excess saving then the interest rate must go down (even below zero) to encourage people to pay off their debt and get rid of excess capital as the interest on loans slowly approaches 0%.
So there was this final last ditch attempt. Corporations and the rich became net lenders and they simply lent to (risky) households who were buying homes. Bankers noticed some regulatory loopholes and stopped caring about who they are lending to. After all, they are being flooded with money.
A -6% negative interest rate on cash would basically make QE irrelevant and allow price level targeting i.e. perfect price stability with zero inflation. Because liquid money is now freely circulating there is no risk of deflation which means governments can pay off their debts to reduce the supply of money which stops inflation. Unemployment would be very low as the cost of financing in a saturated market becomes 0% and no longer acts as a profitability gate that keeps people unemployed (e.g. growth dependence is gone). I am optimistic enough to believe that any further productivity growth would simply reduce people's working hours rather than keep them unemployed.
Also, if long term interest rates are near 0% then short term interest rates (e.g. on cash and deposits) must be negative to maintain a steep yield curve. Even if all you believe in is a 0% interest rate on loans you'll still need negative interest on cash to encourage people to lend their money out for a longer duration (certificate of deposit). When you think about it, a bank is using your short term deposits to stay liquid, while writing loans that can last many years. You can, without notice, pull out your deposits and the bank is then basically stuck being insolvent for the duration of those loans. That is what threatened banks in 2008 and this is why we did the bailsouts and are still doing QE. To pretend the damn banks are solvent when they aren't. They are being flooded with an endless amount of short term deposits that can disappear at any time.
I know the only attempt at demurrage went so well that they shut it down after not to long, but what do you think this would have an effect on assets over time? Would the demurrage keep the money supply in check long-term? Would people still do what they do now and take out loans to buy assets? I fear that Cantillion Effects would lead to the same cycles we see today. Is your stance that there should never be an interest rate above 0%? Going to have to think more about this, but my gut is thinking is you don't need demurrage except to fix the system we're currently in, in which case it does a great job. But once it's fixed holding cash would go back to 0%.
> It's only logical that your money becomes worth less over time (if you assume it is durable). Keeping something in pristine condition requires an external energy input.
If there was one thing that was going to be durable, it should be financial in nature. I'd much rather see people hoarding cash than houses. PoW coins on the other hand, totally agree with you here. So I suppose I think the demurrage would be based on the upkeep required, and typical currency upkeep is small while PoW is large.
The first thought that came to mind was the Weimar Republic's hyperinflation:
https://en.wikipedia.org/wiki/Hyperinflation_in_the_Weimar_R...
Crypto, and Blockchain, are like little fiefdoms that are being created, and the people who create them, and in the process mine the first couple million blocks, will be the Lords.
As you say, the rich getting richer. And doing it all by hijacking this message of the “little guys” banding together against the establishment.
However that is an implementation decision for each individual project, mostly around how supply is distributed and redistributed, and the inflationary mechanics of the asset. These can be innovated on by forking the original. They are also changeable (technically even in bitcoin, though in reality it seems unlikely), with the risk of forks acting as pressure to make beneficial changes.
What I’m saying here is that it is possible and even desirable to design a cryptocurrency which doesn’t work that way, either from the start or perhaps via an “exit to the community” that over time devalues the stakes of founders and early investors and prioritises the users and value creators within the network.
There are lots of mechanics that can be used for this, and most experiments so far have been limited or naive but I expect to and we need to see more of this if cryptocurrencies etc. are to succeed.
And crypto isn't? The whole thing runs on FOMO
I keep reading versions of this assertion and have yet to read anyone publish a clear list of these "lots" of problems. I am trying to understand. So far, I don't.
In other words, so far I still think crypto is a solution looking for a problem.
Even worse, to me it feels like early entrants and those with millions to throw at crypto made out like bandits and everyone else is in the grips of a Ponzi scheme that will end badly at some point. I could be wrong, of course, I just know too many people who jumped in and got hurt.
An unproven fantasy.
Is this a real question?
You seem to think the answer is obvious. Well, what is it then?
Ok I agree here.
> Well, what is it then?
Banks connected to the political/government controlled currencies tend toward corruption. Banks are part of corruptible scheme. Humans are too greedy with the power of money control.
History backs it up over and over again.
Can you give examples of this in modern first world economies? I am sure there are plenty of examples of banking issues and corruption in third world countries. I am interested in understanding your conclusion that banks tend towards corruption. In other words, it seems you are saying that all banking asymptotically (and inevitably?) end up on the corrupt side of the equation. Not sure I know how to identify that or point out examples myself. Can you help with this?
The broken window fallacy is an answer to getting positive interest in an economy that isn't growing. They are both equally illogical and for the same reason.
The idea of a god given right to 0% interest is the reason why currencies collapse and Bitcoin is sharing that flaw instead of getting rid of it.
Of course there is the caveat nobody is insane enough to agree to Bitcoin denominated debt. Dogecoin might work though.
Human energy consumption has been exponential over time. We started by harvesting crops with our hands; then we we figured how to attach a plow to an ox, which increased our productivity, but required us to house, feed, and maintain the ox (energy). We figured out engines, electricity, interconnected computers, low earth orbit satellites; all requiring increased energy expenditure, but increasing our collective well-being and productivity.
Rather than scapegoat Bitcoin for our climate crisis, start by addressing: 1) externalities are not captured by fossil fuel prices (you need a carbon tax for that, to fund research and to de-incentivize fossil fuel consumption), and 2) governments actively subsidize fossil fuel industries.
Do those things, and Bitcoin will literally subsidize and accelerate clean energy infrastructure investment.
if you find a way to make PoS viable and secure, you'll have saved the planet. work on that.
> an ever-increasing difficulty in the case of Bitcoin (getting worse with time, on purpose)
This is not how Bitcoin's difficulty adjustment works. It increases/decreases with the value of the block reward. This is proportional to the value of bitcoin, transaction fees paid, and decreasing new bitcoin issuance. Bitcoin users pay miners for their PoW because they find the value of using such a system to be worth the cost.
I too enjoy whataboutism to distract folks from the environmental impact of my favorite Ponzi scheme.
> Do those things, and Bitcoin will literally subsidize and accelerate clean energy infrastructure investment.
If you invest in massive solar and wind plants then use that energy to roll rocks up and back down a hill forever like Sisyphus, that's just more waste. Different waste, but more waste. Any energy you spend rock-rolling is failing to de-carbonize the existing grid.
Bitcoin isn't incentivized to chase renewables. It's incentivized to find the cheapest power it can get its hands on anywhere on earth and then waste it. That's why PE firms are re-opening fossil fuel plants to mine with.
> If you invest in massive solar and wind plants then use that energy to roll rocks up and back down a hill forever like Sisyphus, that's just more waste.
Yeah this is what I don't get from the PoW-is-actually-a-good-thing camp. Presumably if Bitcoin were to incentivize the production of clean energy it would be by using it to mine bitcoin. And even if it makes it cheaper to produce due to economies of scale or whatever, that would just translate into increased mining profits. Bitcoin is an uncapped demand on energy that will soak up all energy production up to a certain price (based on the value of bitcoin) so I don't think it can possibly be net positive for energy production/use.
And now renewable energy is the cheapest source of power as of 2020[1].
You do have a point on how there's still emissions generated in the building of wind and solar plants, though, but building wind and solar plants is still our best solution to our electrical emissions other than asking everyone around the world if they would kindly stop using electricity.
"Almost two-thirds of wind & solar projects built globally last year will be able to generate cheaper electricity than even the world’s cheapest new coal plants, according to a NEW report from IRENA"
[1]: https://www.weforum.org/agenda/2021/07/renewables-cheapest-e...
It's intrinsic value is zero. It's economic value is negative, because it's a Ponzi scheme. [1]
[1] https://ic.unicamp.br/~stolfi/bitcoin/2020-12-31-bitcoin-pon...
All money that enters into circulation via fractional reserve lending is backed by demand for that same money, and enforced by the legal system. The repayment of the issuing loan. That’s where it’s value comes from.
Unlike bitcoin fiat operates on a pull model - demand driven. It doesn’t start by creating supply and having people shill it.
Fiat required trade to be based on gold first, a peg which was then broken.
Central banks can create infinite units arbitrarily. "Enforced by the legal system" perhaps means controlled by the FOMC, a dozen central bankers who make decisions behind close doors, nominated and chosen by congress I believe.
They literally cannot. Central bank reserves aren't money in the sense of legal tender. Only borrowers can "create" money and they create an equal debt in the process which means all money in existence will have to disappear one day. Money has zero value throughout the entire process, the provider of value is the borrower, human being made out of flesh and blood.
It's like matter and anti matter that balance each other out.
Ditto the core team raising the supply cap.
Ditto the US initiating a nuclear missile strike on Iowa.
They could, but there's many reasons not to.
You agree they can service an unlimited amount of debt (with consequences), but you refuted that they can create unlimited money. But they're the same operation.
Fiat is by definition not based on gold.
The term is [...] usually reserved for legal-tender paper money or coins that have face values far exceeding their commodity values and are not redeemable in gold or silver. [1]
What you're describing is at most - at most - a default on the government's obligations 89 years ago. Not a Ponzi scheme lol. Everything folks are suspicious of is a Ponzi scheme these days.
> Central banks can create infinite units arbitrarily.
Central banks do not create money. They at most indirectly affect the money supply via adjustment of interest rates and reserve requirements. [2] However their mandate under which they operate is to maintain low, predictable medium-term inflation targets and maximize employment.
This is like saying "well, actually, the Bitcoin core team can adjust the 21M coin limit up to an arbitrary value!" They could, technically, but there's a ton of reasons they won't.
> "Enforced by the legal system" perhaps means controlled by the FOMC.
No it does not. When you borrow money from a retail bank, say to purchase a house, they create new money that enters the system, paired with a negative balance on their books. The new money is backed by the demand of the issuer to re-pay that loan. As the loan is re-paid the new money is destroyed and leaves the system. The legal system enforces payments in these contracts.
> ...a dozen central bankers who make decisions behind close doors, nominated and chosen by congress I believe.
They are nominated by the president and appointed by congress. The Federal Reserve is an independent organization explicitly to separate capricious fiscal policy from the kind of stable monetary policy necessary for businesses to plan into the future.
They were created by an act of congress and can be repealed by act of congress. They act on behalf of the American people and are accountable to the American people. All decisions are published and documented along with full audits. Like the post office.
There's nothing more sinister or shady about the Fed than there is about the USPS.
Sure does spook people though.
[1] https://www.britannica.com/topic/fiat-money
[2] https://en.wikipedia.org/wiki/Money_creation#Central_banks
QE is not carried out by creating money. It's carried out by creating bank reserves and exchanging them for assets at primary dealers, increasing liquidity. That article you linked elides a number of key intermediate steps. QE indirectly increases the money supply as I explained to you. Not directly as you seem to continue to imply. [1]
[1] https://www.forbes.com/advisor/investing/quantitative-easing...
If the fed wants to buy $100b of assets tomorrow, it can do so, despite not having that money. The interbank mechanics are unimportant, the point is the value is created at will, creating inflation, and is a decision of a few powerful individuals.
Bank reserves are not circulating money because they cannot be spent. [1]
> The interbank mechanics are unimportant...
They are literally the only important thing. That's all we've been talking about.
The bank having these reserves frees up room for the bank to lower their interest rates and in turn create more loans. See, it's this lending process that creates new circulating money. The Fed issuing 100T of reserves and giving it to BoA would not change the circulating supply one iota in and of itself.
> ... the point is the value is created at will ...
Again, no, no value is created by this operation. It's entirely neutral. What happens is these lower-interest rate loans (coupled with the obligation to repay same) increase the viability of business models, fund productive activities in the economy and back the newly created money. This is where new value is generated. Not in creating reserves.
> ... creating inflation ...
Again, no. Inflation is a measured effect. It has nothing to do with supply per se in the federal reserve model. Just ask Japan. They went absolutely ham on QE since the 1980s and they haven't seen inflation since 1995. [2] So much so it's actually been very problematic for them.
> ... is a decision of a few powerful individuals.
Yeah like every Supreme Court decision ever. These individuals are accountable to congress. This is called representative democracy.
Scottie, and I'm going to assume your name is Scottie - I mean this without disrespect. Please audit an economics class. And maybe a civics class. Thus far everything you have suggested is trivially wrong.
Quantitative easing (QE) is a form of unconventional monetary policy in which a central bank purchases longer-term securities from the open market in order to
increase the money supply and encourage lending and investment. Buying these securities
adds new money to the economy, and also serves to lower interest rates by bidding up fixed-income securities. It also expands the central bank's balance sheet.
I don't know why you don't think creating money and buying bonds and mortgage securities on the open market counts as money creation. Or if you're being particularly semantic about the mechanical flow of this money. None of these occur without the central bank changing digits in a database which magically allow new money to exist.
You are wrong on this one, and you do not understand enough to even want to challenge your assumptions. We're done here, and I once again, implore you to audit an economics class.
https://www.youtube.com/watch?v=mrjoElG8KGI
PELLEY: Fair to say you simply flooded the system with money?
POWELL: Yes. We did. That's another way to think about it. We did.
PELLEY: Where does it come from? Do you just print it?
POWELL: We print it digitally. So as a central bank, we have the ability to create money digitally. And we do that by buying Treasury Bills or bonds for other government guaranteed securities. And that actually increases the money supply. We also print actual currency and we distribute that through the Federal Reserve banks.
NARRATOR: But by law, Chairman Powell's Federal Reserve can only lend money that must be paid back.
Which is what I've been telling you.
Powell was providing a simplification, an analogy, so that folks such as yourself without a meaningful background in economics can understand. Obviously he did an insufficient job, and I strongly suspect this clip was out of context.
Furthermore, there are some that believe an interest rate should be determined by markets rather than policy makers.
And on the personal note, I have a minor in economics, my bachelors was finance. Economics is a broad subject, and even if you study monetary policy at the undergraduate level, the mechanics of central bank asset flow is not a subject well covered. But hey, thanks for the elitism and insulting the 99.99999% beneath you.
Fuck them. Seriously, fuck them. Ban bitcoin, smash every bitcoin mining rig. The world will be better in every way the next day.
What's scary is that the whole thing was designed to be unstoppable.
My utopian hope for the future is that we start sending rigs in orbit close to the sun. Since we only need to send a few bytes back to earth this becomes the only competitive way of doing mining. Space travel thus becomes dirt cheap. Humans are finally able to explore the solar system.
But that's just a dream. Realistically, we are screwed.