By this logic, we should all leave our lights and air conditioners on while we're at work or on vacation because it will increase demand and hasten the transition to renewables.
The idea that you can be paid to waste this power just creates economic incentives against the improvements we actually need to be making.
Firstly, at regular electricity prices, bitcoin mining is profitable and it is profitable for the utility to run renewables (which in turn means it is/was profitable to build renewables). When there is substantial demand or low supply, then it is profitable for the utility to pay the bitcoin miners to turn off, because the alternative to import power is more expensive. This in turn makes your electricity cheaper. In addition, the additional steady state demand for power allows for more renewables to be built, which further increases the supply during low supply periods. Your AC does not automatically turn off when this happens.
I am one of those enthusiasts making "strange logic" claims. I've been making this claim well before others but I feel that I keep getting downvoted on them off of people's emotion rather than rational logic.
The transition from fossil fuels to renewable energy sources has altered the environmental impact of additional electricity consumption. Where once any increase in consumption was considered harmful due to its reliance on fossil fuels, the rise of renewables introduces scenarios where the marginal environmental cost of electricity can be beneficial if the demand is flexible.
Bitcoin mining has the potential to act as a load balancer for the electricity grid. By increasing its energy consumption during periods when renewable energy production exceeds demand, and reducing consumption during peak demand periods, Bitcoin mining could help stabilize the grid and make renewable energy generation more economically viable.
Bitcoin mining's demand for electricity is unique in that it is primarily cost-driven. Renewable energy generation capacity is particularly volatile. Bitcoin mining power usage can be flexible and responsive to the availability and cost of electricity.
The ability of Bitcoin mining to consume excess renewable energy when it's available (and potentially at low or negative prices) could improve the financial viability of renewable energy projects by increasing the floor price these new projects can sell electricity at. This can encourage the development of additional renewable energy capacity by providing a reliable demand for their output during otherwise unprofitable periods.
Here's some examples:
https://news.ycombinator.com/item?id=25444985
https://news.ycombinator.com/item?id=26094279
https://news.ycombinator.com/item?id=26811819
In other words: your scenario is identical to GP's except that someone is paying you to run your AC while you aren't at home, rather than just doing it because you can. The logical question is then to ask why they're paying you to run your AC, and that is the uncompelling part: it's not clear that we should be paying people to burn energy to crack hashes.
Money is just another technology. As a technology it has existed in various forms over thousands of years.
Technologies see continual innovation and change, with various actors and various motives influencing their use, function, reach.
Governments of various forms are our current best method- govern-ance- for managing human-scale assets, resources, and technologies with collective purpose and implication.
Moneys- currencies- as a technology are one of those human assets owned and managed by governments, like land, and other resources. There are over 200 distinct currencies in the world.
The mechanism for this management is based on the notion of a ledger- the record of balances, of debts, of interest, and the creation- inflation- of money supply in the context of that management.
Most governments are poor at this management when measured by how well their implementation of this technology that is money serves the needs of most of their populations.
Governments themselves- both "democratic" and non- in their current form are fragile and vulnerable, with the powers of governments utilized against portions of theirs and other populations.
BTC is a technology, a cryptographically-secured system of record- a ledger- that can be used as a money. It is not under the control of an existing government.
By collective agreement of its participants, a complex balance of users playing different roles with different incentives and risks, the rate of creation of assets recorded there is managed to a low level of inflation. As such, as a technology utilized for money, it is a stable "store of value" in contrast to the moneys supplied by literally every government.
The ledger, the system of record can be preserved- secured- if and only if it is too expensive for attackers to change it. The turning of energy into hash minting is the security for that system of record.
That's it.
Adopting a mindset where the above argument takes hold involves a kind of leap of faith. It is a belief. Sure, a religion. The game theory/mechanism design behind BTC is a true innovation, the first demonstrated solution to the Byzantine Generals problem.
There is an argument- won't people stop believing in it?
Maybe? I would suggest evaluating that argument against the lifespans of other innovative beliefs.
Is it something that comes and goes, or is it like the eye, an invention of evolution that solves a specific problem and appears distinctly and repeatedly in different organisms once they hit certain levels of complexity.
Cheers.
It was first, and first mover advantage is significant, which has turned into network effects and inertia, and now with the ETF recognition has gained "official" validation;
Anti-inflation is one of its core design principles, is the basis for store of value, and commitment to it has remained solid;
After ETH PoS changes it remains the only proof of work chain. PoS has belief failure modes that can lead to collapse of value. PoW-based value by definition is secured by the cost of the work. It is a financial equation- a ledger can be maintained at the underlying cost of recoverable energy- not a political/fashionable one.
Mindshare can be fickle, and if purely based on fashion, if there is no inertia and there are adjacent equivalents, value can be lost quickly. With BTC there is inertia, because at a deeper level there are no adjacent equivalents. BTC continues to occupy a unique niche in the design space of these artifacts/assets.
I can see the inertia argument. Why switch when it works. I still don't see the store of value argument when Bitcoin requires such exorbitant amounts of energy to keep up. That's a tax on the value. "Look how much energy it's using, it must be worth a lot!"
those are basically mental model points- to label the energy cost to do what's called "secure" the BTC network a "tax", and to see the amount of energy BTC uses in that context as exhorbitant and wasteful.
The former mental model point about a tax is kind of hard to address without getting into the weeds but will just say people kind of don't mind taxes that pay for the military, they understand the "securing a way of life" concept. The American system of military dominance and rule of law and so forth is kind of a "platform" and people don't mind paying for it. BTC is also a "platform" that in financial terms is much more aligned to those who are most sensitive to taxes because the wealthy have all kinds of inflation mitigation strategies available to them, and poorer people with only incomes do not. But anyway "believing" in BTC involves adopting the "platform" mental model, the cost of which to "be secure" is the amount of electricity it uses. It is a bit in the weeds.
The unnecessary waste argument though is an interesting one, eg where BTC is wasteful like just running your A/C unnecessarily or whatever. The most relevant comparison is looking at something called "home idle load" which in the US is basically the background appliance energy use. BTC total electricity use is in fact a tiny fraction of home idle load, in the noise of home idle load, which people don't really get exercised about and many when buying new appliances pay little or no attention to.
If we're talking about the value of a currency, we're talking about what we can get in exchange for it. And when we talk about the store of value, it's what we can get in the future. With Bitcoin, we know it must burn energy, so we can get something only less that energy. The currency may get more "believable" due to the burning, when you look at sacrifice as commitment. But what are they committing to? Burning more in the future, because they now have coins they want to keep their value?
The funny thing is that most people trade in virtual Bitcoin they don't control. Because it's more comfortable and the ledger doesn't support the volume. So they need a government to assert their claim on their coins. I guess one can't even get Bitcoin from their ETF and needs to round-trip to some other currency.
The market is settling out of chain, because it's cheaper.
Will try it this way. The store of value is a derivative result of the actual innovation, which is- BTC for the first time is a computationally secure mechanism that provides a system of record, the contents of which are somewhat resistant to political attack and manipulation.
A system of record is the basis on which rule of law exists, the basis for accounting and financial transactions, the basis for property, etc. Proof of Work vs Proof of Stake vs others as the "costs" for maintaining those systems of record, are experiments, empirical discovery processes to see which one(s) over what timeframe hold water.
Specifically to the points:
> BTC vs Gold
Yes. BTC is a technology that has wider use cases than gold. Store of value is just one use case.
> Who is paying for those watts and why?
Right now, people who want to make money, it is economically viable to turn stranded energy into "mining". Who is benefiting from the use of the ledger for store of value and medium of exchange? Often, not always, elements considered criminal by most governments as well as people whose legitimate needs are not being met by their governments.
> store of value...we can get something only less that energy
This is where I think the disconnect between the mechanism that BTC is, and these "rhetorical" questions, is greatest. BTC is a system of record platform. We have lots of other ones. All systems of record require upkeep. They are out there, they are expensive, we don't think about them. They are just people's jobs. Every county has a system for property and title maintenance. Every single financial institution has a ledger- many ledgers. etc.
Many of these ledgers are private. Oracle, the database company, originally became a big business on being the underlying mechanism for millions of private systems of record around the world. In every one of those ledgers, there is a DBA who can do UPDATE X SET VALUE = Y WHERE KEY = Z and often does- certainly "legitimately" governed by the various policies and protections and business rules and so forth that apply to the ledger. But sometimes those UPDATE SQL statements are "illegitimate" and those often occur when the political and governance mechanisms in the business or in the country are breaking down.
There isn't any of that SQL manipulation in BTC. Storing asset holdings is again, just one use case. Attestations, like on off-chain ownership, are another.
And to be sure:
> The market is settling out of chain, because it's cheaper
Absolutely- or rather, there is a lot of implicit cost hiding and inertial convenience in existing systems, as one would expect. And they work "well enough" in a "worse is better" sense. BTC may be too good, too "perfect", too expensive, as a system of record, long term. We'll see.
Hope that makes sense. Cheers.
At the same time I have a hard time accepting that people could see use in the inherent waste of energy. And it irks me when it's framed as use of "stranded energy". Because that's far from reality.
I've heard two voices so which is it to you? Is Bitcoin useful now and worth the lost energy? Or is it an experiment of an interesting tech gone too far?
Relative to other blockchains, like PoS ETH, etc- the question of whether BTC is "worth the lost energy" does have meaning. I think when one looks at the full spectrum of use and failure cases, the "lost" energy is an important part of the value proposition that BTC as technology offers. I don't see ETH or other PoS replacing it. Instead they are kind of complementary.
As a technology, like all technologies, BTC certainly has costs and externalities. Money as a technology is as important, say, as transportation technologies. So look at cars. Cars powered by internal gas-fueled combustion engines could definitely fit into the classification of "experiment of an interesting tech gone too far" given the incredible waste, ecological and sociological damage, and climate impact car-based travel and -based societies incur that, for instance, are lessened in mass transit-based societies. But we are stuck with cars, their global use continues to grow, and we're adapting, introducing and scaling electric, more efficient materials for roads and the vehicles themselves, safer automated driving, etc.
There is no going backwards. BTC and its ilk are part of the future, for both good and ill, IMO.
Specifically as a store of value, I do think BTC has a bright future. I have a small portion of my net worth in BTC, small because there are still non-nil risk and failure cases that could impact it specifically, and diversity across risks is important. It is also important to understand what one is getting oneself into in terms of one's investments. It is an "active" investment, not "passive." People who are looking for passive-like benefits should not look for them from anything in the "crypto" space.
One thing I'm wondering: did you acquire actual Bitcoin, or title to it?
In the crypto space there is data to quantify the cost of divergence. People who want to just get off the train- fine- there are others willing to play/drive.
Re: actual BTC vs title- the BTC I count is that which I only have title to, e.g. held by a custodian. Yes, not your keys, not your coins- but as both a technologist who has had to manage- and has lost data- and as someone also with a background in the financial space- custodianship is one of those essential cultural/behavioral features- it only works if people follow certain rules, and those who do not are punished. My custodians have been around for a while and are I believe properly incentivized. As such they will be better suited to asset management than I am, as a single point of failure. Once more mature multisig/social auth workflows are worked out I will probably move to those. I am lucky to have partners who can play parts in those.
if you want a transition away from carbon, you have to solve that question.
https://en.wikipedia.org/wiki/Carbon_fee_and_dividend
This would remove the incentive to mine crypto on any grid that is coincidentally emitting carbon.
As most (if not all) uses of electricity, Bitcoin mining is sensitive to the electricity price. Introducing a a carbon tax / carbon dividend, doesn't magically make any particular use of electricity economically unviable all of the time. It just pushes the cost equilibria to different values.
In particular when we artificially increase the energy require to crack said hashes. If hash-cracking was, for instance, bid out on a competitive marketplace[0] instead of limited by difficulty bitcoin would need far less power to perform its 'role' as a 'currency'.
[0]Want to mine a block? Bid for the mining rights (in USD or BTC).
Im not saying this is good, but its the way it works...
I'm arguing that the unique energy demand characteristics of bitcoin mining allow it to support building renewable energy projects and balance electricity costs and thus it has effective positive contribution to the environment.
Whether it's used to mine bitcoins or cool a house is irrelevant, except that the demand for cooling a house is location and time sensitive, whereas bitcoin mining is cost sensitive. This flexible consumption gives it unique properties that support deployment of renewables.
Please explain what you mean by "false economy". Is the economy for skins in a game you don't care about "false" because you don't like that game?
Not if someone paid me to do it. That's the point. If there was money in hauling ACs around the US and running them on the cheapest electricity the local market could provide, we'd have exactly the same false economy.
(Besides: the GP points out that Bitcoin appears to be sufficiently profitable on NYC electricity prices, which are not cheap. They also appear to be sufficiently profitable on "retiring coal plant" prices[1], which undermines any kind of unique incentivization of renewals argument.)
[1]: https://www.indystar.com/story/news/environment/2023/12/05/c...
Gold worked as a currency as it was independently verifiable from either side of a transaction. Modern currencies work so long as they’re backed by credible assurances of their value. Ie passing off fakes is dangerous and they may be used as “legal tender.” (That term could itself be further defined via google.) crypto currencies seem to lack this functionality. (Not wanting to abide by any law outside core network mechanics is functionally close to establishing a new form of sovereignty. Only sovereignty doesn’t work like that.) Also note how hyperinflation is dangerous to the assurance of value of a currency. Similarly, any form of instability could shake those assurances.
Modern currency is also almost trivially, embarrassingly parallel.
How is such a purely hypothetical scenario useful as an argument?
It's like saying: "If nobody ever did physical harm to anybody, we could get rid of some part of law enforcement." Not useful because it's simply not the case and very likely never will be.
> They also appear to be sufficiently profitable on "retiring coal plant" prices[1], which undermines any kind of unique incentivization of renewals argument.
Bitcoin mining incentivizes any kind of generation that cannot be consumed by a more profitable process or use case. If the price of electricity on a mostly fossil powered grid is low enough, then Bitcoin mining will be profitable. Same goes for a mostly renewables powered grid.
There are two ways, politics can handle this:
A) Impose a high enough carbon tax on fossil generation. This will lead to higher electricity prices for the fossil grid, possibly making Bitcoin mining unprofitable. But it will also make other uses of electricity unviable.
B) Regulate that Bitcoin mining is prohibited under certain conditions (location, grid generation mix, ...)
B doesn't appear wise to me. Since it's highly subjective what kind of energy/electricity use one deems useful/legitimate. I personally find the use of a > 100 horsepower private car or a private jet totally illegitimate and would welcome regulation that drastically hinders these absurd uses of energy.
And even if that weren't the case, your argument still makes no sense. Every watt that Bitcoin mining incentivizes is then consumed on Bitcoin mining, it's a zero sum game.
It's like building heaters in the desert: if you're willing to spend money for 1GW of electricity to run your heater, someone will build a 1GW plant for you. Now there is nominally one more 1GW plant in the world, but there is 0 extra available power, you're using up all of it to heat the desert.
Bitcoin mining, far from the wasteful ‘heating the desert’ analogy you propose, incentivizes the development of excess energy infrastructure that can be redirected or scaled based on demand fluctuations, acting as a catalyst for innovation in energy production and management.
Moreover, your argument smacks of a dangerous ‘divide the cake’ mentality, suggesting we should cap our aspirations and limit access to energy and technological advancement to maintain a status quo. Should we tell emerging economies that they must forego the benefits of modern technology because we’ve decided there’s simply no more room for energy growth? That’s not only patronizing but inherently regressive.
The beauty of Bitcoin and its underlying energy consumption is that it encourages the search for more efficient, cost-effective, and often greener energy solutions. This is not about wasting resources; it’s about driving forward a future where energy is more abundant, accessible, and sustainable for all. To stifle this under the guise of protecting resources is to deny the very essence of human progress and innovation.
> Bitcoin mining, far from the wasteful ‘heating the desert’ analogy you propose, incentivizes the development of excess energy infrastructure that can be redirected or scaled based on demand fluctuations, acting as a catalyst for innovation in energy production and management.
You do realize that the article here is directly pointing to evidence that the bulk of large bitcoin mining operations are being driven from existing fossil fuel plants that seemed to be on their way to decommissioning?
This is what I don't like about your argument: it's a standard Bitcoin talking point, but people struggle to point to actual examples of Bitcoin mining spurring investment in renewable energy, while it's easy to point to actual examples of Bitcoin mining spurring investment in decommissioned/decommissioning fossil fuel power plants. The facts on the ground just do not support your argument, period.
Blaming Bitcoin for enabling these fossil fuel plants to continue is a red herring that distracts from the real issues: ineffective global energy policies and the threat Bitcoin poses to centralized financial systems. It’s easier for governments and critics to scapegoat Bitcoin than to admit their failure in promoting renewable energy or to face the uncomfortable truth that Bitcoin challenges their control over monetary policies. The narrative that Bitcoin only supports dirty energy is a convenient oversimplification, ignoring the broader economic incentives at play and the potential for technological innovation to drive a shift toward renewable energy sources. Let’s not mistake symptom for cause; the focus should be on fixing flawed energy policies, not demonizing a technology pushing for decentralization and innovation.
One can justify all sorts or environmental destruction with this your argument. Pouring oil on the beach is pushing local regulators to act, spurring the creation of less harmful lubricants.
The numbers show bitcoin mining is doing harm.
It's not clear to me that Bitcoin delivers sufficient economic value to justify the vast power demand. What utility do all these hashes provide, except to other people who bought into crypto trading? If there were some positive externality that'd be great, but there's no inherent value to crypto beyond the artificial scarcity.
The worth of a decentralized and uncensored monetary framework is beyond imagination; it promises to unleash the inherent vigor and potential of an organic market-driven capitalism, unfettered and boundless. Such a system stands poised to precipitate the downfall of the fiat regime—a mechanism that has empowered governments of every stripe to engage in warfare and to subjugate their citizenry, not excluding even the most free and illustrious nation such as the United States.
This assertion is far from nonsensical; it is a veritable truth, one conspicuously absent from educational curricula, likely because states find the acknowledgment of their historical predilection for violence too ignominious to bear. Taxation stands as the state’s principal means of amassing resources. Yet, for those states compelled to engage in warfare, mere taxation proves insufficient. Here, the utility of modern fiat currency becomes apparent, facilitating the acquisition of resources beyond what a transparent tax rate would permit. Through fiat, the dilatory effects of inflation serve the dual purpose of either being dismissed as unrelated in the event of victory—perhaps offset by the spoils thereof—or, in the case of defeat, rationalized as a war’s consequence. Regardless, the result is the same: a surreptitious expropriation of the populace’s wealth.
State-initiated actions, notably famine and war, rank as the foremost causes of human mortality, surpassing even health crises and natural calamities.
The inception of the modern fiat system, marked by the establishment of the Bank of England, was explicitly intended for waging war. Indeed, the very creation of the contemporary British Pound was predicated on this bellicose objective.
P.S.: Please excuse the grandiloquence of my discourse; consider it a charming anachronism. I hail from the future, having spent several delightful decades marooned in the 1800s. Only recently have I elected to grace the early 2020s with my presence, and it appears my linguistic preferences have yet to acclimatize to the present era’s vernacular.
It's actually rather more like "we'll rapaciously use energy to bring the grid to its utmost limits, but don't worry, if you pay us lots of money [in some cases, more than we get from our regular business!], we'll happily not use quite enough to actually cause it to buckle and fail." Sounds like an extortion racket, doesn't it?
Lots of things have the potential for lots of things. But we need to operate on the reality as it exists, and that reality is that Bitcoin uses a phenomenal amount of power, to the point that people are paying Bitcoin miners to not use electricity when the grid is at capacity (as mentioned in the article).
This is a major flawed assumption. Even in a 100% renewable world, every extra watt consumed carries an environmental cost. It is of course less than when burning fossil fuels, but it's still there, and not necessarily even that small.
> The ability of Bitcoin mining to consume excess renewable energy when it's available (and potentially at low or negative prices) could improve the financial viability of renewable energy projects by increasing the floor price these new projects can sell electricity at.
The world has not run out of useful things to do with energy yet, so this is already a bizarre claim. But even ignoring the uselessness of Bitcoin for a moment, this clearly incentivizes the wrong kind of renewable development. If you need to turn your power to Bitcoin to be profitable, that means you can't afford to store this power even as the technology to do that improves. And if you can't store the power, then you can't be part of a fully renewable grid, so you're essentially building the wrong thing and it's better to leave the resources alone to be used in other projects that can actually be self sustaining.
New bitcoin from mining is halved every ~4 years, so every four years miners can afford to spend only half as much electricity to mine from that revenue.
As revenue from new bitcoins tapers off the work expended will self limit to the value of transactions. If you're charged 1% to include your transaction the value of energy used to mine a block will eventually not exceed the fee for including those transactions.
So it doesn't have the characteristic of consuming more and more energy and is self-limiting in how much energy is used. The bitcoin energy problem will take care of itself in time.
That's not how it works. The whole point is to spend power (work).
If there was some breakthrough that allowed finding hashes with 10x less electricity, then the network wouldn't burn 10x less electricity. It would instead find 10x more hashes.
Not exactly. Miners are paid out of the sum of block reward and fees multiplied by the market price of BTC. Every ~4 years the contribution of block reward goes down, but that doesn't mean that the price goes down, or that the contribution of fees stays the same.
If it was block reward alone and the "energy problem solved itself" then the blockchain would be completely vulnerable to a 51% attack and it would instantly become worthless.
The expectation is that the contribution of fees will go up as the block reward goes down, although it remains to be seen how much direct fee the market will bear. Currently the actual cost of a BTC transaction is hundreds of dollars - but most of it is socialized via inflation. It is unclear if the market will bear paying hundreds of dollars in transaction costs instead -- and if not, there's no reason the 21M coin limit can't be raised to continue doing exactly what has been happening so far.
I thought... huh, this can't be right. So I did some back of the napkin math. We have about 2500 transactions in a block, a block reward is 6,25 BTC. That comes around a cost of 0.0025 BTC per block, or about 112USD. That's without considering the extra tip from the transaction. So, not really hundreads, but damn' close.
It makes me think increasing the block size really wasn't a bad idea.
> there's no reason the 21M coin limit can't be raised to continue doing exactly what has been happening so far.
Sure, but you'd need a hard fork. Not impossible, but hard to reach the consensus.
The goal of the "halve every 4 years, plus transaction fees" model is to make sure the above is never possible for an attacker.
Like what? You really believe people are mining BTC in Manhattan?
For mining to be profitable, cost of energy you put in must be lower than the value of a Bitcoin. Where is energy cheap? Not where there is a need for it, like you claim, but where it is wasted. You don't mine BTC in Manhattan, you put a Bitcoin farm mining off peak on a hydroelectric power plant in the middle of nowhere, China.
Please let's stop this nonsense of Bitcoin stealing energy from who needs it the most, as it is utter baseless nonsense that just betrays total ignorance on the simple concept of supply and demand, and why things are priced a certain way.
[1] https://teslamotorsclub.com/tmc/threads/power-inverters-for-...
do you want someone to tell you how you are able to use that electricity?
what's next? clutching our pearl around gas guzzlers? forbidding people to eat meat? do we want a free market or not?
If the power I use comes from renewables is that cool?
Now you may say you should be free to spend money on the horrendous energy bill of those miners, so that they allocate some coins to you. If there were no externalities, I'd agree. But since there are, I will argue against doing it. And we won't bridge that divide here I guess.
If the proposal is to reexamine and change the way our society works in order to avoid the tragedy of the commons that's great.
If the proposal is to arbitrarily ban something we don't like or understand that's a problem.
How about the amount of power a datacenter uses? What about all this "AI" - the hardware used for training the models is very power hungry?
If we believe both statistics, then crypto mining uses roughly as much electricity as all data centers. But data centers drive so many different industries and benefit people in countless ways- entertainment (as you mentioned), financial, education, communication, etc, etc.
Crypto is like. Neat? There's some people who benefit greatly from it, sure. But broadly compare how different society would look if crypto didn't exist (not different at all, I'd think?) to how different it would look if data centers didn't exist. Looking at it that way, it's crazy that they at all use similar amounts of electricity.
(I'm not even climbing up the tree of Bitcoin's energy consumption being many multiples greater than Reddit's.)
While Bitcoin arguably parasitises energy, social media parasitises human time and attention (which is a much scarcer resource), all while breaking down political institutions and societal cohesion and being a tool for foreign actors to manipulate people on never before seen scales. Social media is "move fast and break things" on a societal scale.
Bitcoin is at worst a speculative asset (no worse than most financial assets) at best a new monetary system in its infancy (unlikely but possible). It is clear to me which technology has more of a raison d'être.
I guess social media pays the salaries of most people on this forum, so the old adage "It is difficult to get a man to understand something, when his salary depends on his not understanding it" applies.
Or maybe I'm completely wrong. It's happened before. The future will show who is right.
ultimately, once you start thinking you have the right to ban things you should be prepared for someone else to ban things you enjoy.
While there are different ways to evaluate any given topic, all opinions are not equally valid.
you may not like what I do with the power I PAY for but you don't get a say in how I use it.
Yes. Absolutely yes.
> you may not like what I do with the power I PAY for but you don't get a say in how I use it.
There are thousands of things you're not allowed to do with the power you PAY for.
If I am paying for the electricity do I have the right to use that electricity however I like? Next time you don't like how much electricity "bitcoin" uses ask yourself: am I okay with the government dictating how I am supposed to use electricity? in fact, am I okay with the government dictating anything that can and should be adjustable through the free market?
Maybe it was that weird guy on a pole out in the field
As far as financial instruments go, Bitcoin is fantastically, comically inefficient, and by design.
What do people get from Bitcoin? Monopoly money with no purpose or intrinsic value.
See:
> It's like if idling your car 24/7 occasionally produced solved Sudoku puzzles that you could then exchange for heroin.
* https://twitter.com/VessOnSecurity/status/113524359527398604...
I don't think basically anyone is doing that.
They don't seem to understand that Bitcoin alone accounts for 98% of all cryptocurrency energy usage due to its uniquely energy-intensive algorithm. Hypothetically if Bitcoin were shut down, crypto would be as energy-efficient as any other distributed/federated technology.
The reason most money goes into bitcoin is probably, that people consider it safer than proof of stake.
How proof of stakes is fire proof is harder to understand, and the information I found did not 100% convince me (not an expert in cryptography so doesnt mean much)
I never put money into crypto btw. Its just gambling right now imo.
Using the fact you can sell it for minimal slippage, you could call Apple shares money, but they're not. They're shares. Nothing is priced in Apple shares.
The attributes of money are: durability, portability, divisibility, uniformity, limited supply, and acceptability.
Bitcoin is not accepted basically anywhere (the overwhelming majority of places that claim to, use a service like BitPay that immediately sells it and gives the merchant actual money). It's also not uniform, because each sat carries with it the entire transaction history. It's also not particularly portable because its global transaction count is limited to 7tps and it costs an unbelievable quantity to do so from time to time. It's also not durable because everyone keeps losing their wallets and the lost bitcoin is effectively destroyed. All it has is limited supply and divisibility -- and portability, depending how compelling you find my argument against -- but you really do have to get all 6 to win.
Coinbase attorneys regularly compare crypto to Beanie Babies.
> "It is akin to the sale of a parcel of land, the value of which may fluctuate after the sale. Or a condo in anew development. Or an American Girl Doll, or a Beanie Baby, or a baseball card," Coinbase attorneys stated in a motion it filed in August 2023. [1]
[1] https://www.usatoday.com/story/money/2024/01/19/crypto-beani...
It could have been a sqlite db file on a raspberry pi somewhere, keeping track of digital jars of goat semen that people then pay real dollars for. But no, instead we're wasting one Australia worth of electricity on Bitcoin.
Dollar is also just paper, there is no underlying thing except trusting the united states.
Im not arguing its worth the amount of energy, but its not as dumb as you pretend it is
That is... oddly specific.
The original USD sunk into the system is mostly gone, spent on electricity, mining rigs, hookers, and blow.
If you attempted to withdraw that much money, you’d be stonewalled.
The only way to do it would be to hire some coders, set up your own “trading” web site, and convince a million rubes to part with a thousand each on average. You’d have to do this for years while loudly saying “Bitcoin is not fake money” in every Internet forum you can spam, because otherwise the music might stop before you can cash out.
I don't believe in the concept of a "humanity". There are humans.
Bitcoin has no incentive to do this, and no ceiling on consumption, since any efficiency gains just get plowed straight into increased mining, and so energy consumption can only ratchet up, forever. Address that claim, please.
If we just properly externalized the cost of CO2 emissions it solves this problem along with many others. So why don't we do that?
That redundancy is otherwise uneconomical to produce (if there isn't the demand).
When that redundancy is needed, that power can be redirected from the miners. Presumably the miners are expected to behave and switch off at such times, but there is no reason why that expectation can't be legislated.
If you're opening to understanding why it's not bollocks, read this
1. Ownership and Security
Bitcoin is the only solution to really "owning" your money. Everything in your bank account can be stolen / frozen / or made "inaccessible" at a moments notice because of some vague bullshit reason like supporting right extremists or terrorists - even if you donate a single dollar - like it happened in in 2023 Canada / freedom convoy. Everything a bank claims to be secure/safe goes away like a poof of smoke if it really comes down to it. The can't be any safety in our increasingly multi-polar world the political boundaries are redefined daily. Today Russia/China is the enemy, tomorrow it's some other country that will suffer economical sanctions. Or your own country decides to apply punitive measures against some minority group because of political opinion - all the control mechanisms are there and politicians are itching to use them.
2. It's less than our current banking sector
Yeah, consuming this much natural resources / electricity sucks. That's the alternative? Do you count how much money is spend on the banking spector as a whole? I assure you it consumes much more then the 2% in capital expenditure - so indirectly it's more (you could have build renewables with the same money) .
3. Scalability
About the famous argument that bitcoin does not scale: the 7 transaction per second argument -> this problem is completely solved by the lightning network. Lightning protocol does the same with much lower transaction cost and much less energy usage - something like 100x less. Yes support at major vendors is still a bit lagging behind but that's only temporary. Need a 100% confirmation? Do full transaction (for example for accounting purposes). Small sums and personal funds -> can be completely handled by a lightweight lightning network transaction. Bitcoin is a highly technical solution and there are myriad ways things can be improved upon if scalability really becomes an issue - even if the lightning network would become saturated.
Not everyone around is supporting the idea that the government scam and it's "real" money is the best option for us all. Electricity is burned in exchange for the utility of the bitcoin, avoiding operations with traditional state-issued money, having a currency which nobody truly governs or controls but the people, and it is definitely here to stay since it is a revolutionary financial instrument. If it wasn't, it would simply be gone, and no-one in his sane mind would be "turning electricity into heat" for nothing.
It is a natural economical progression for the humanity, to have the money nobody owns, and the maths behind it make it happen having it's natural energy toll, which is way more efficient that of any government. Commies go downvote, it is your bread
Bollocks!
Unlike other technologies that are incentivized to become more efficient over time, because of how competition over mining rewards works, this technology has the characteristic of consuming more and more energy the more it succeeds.
It's designed to waste energy. Even if that was "green" energy, it's still just making heat out of electricity for pretend internet money. Energy that other things could be using.