This is completely wrong. They scaled energy with number of transactions.
> At each time step, CO2e emissions for the given number of transactions were estimated based on the emissions generated to mine that number of transactions in 2017.
Bitcoin network does not work that way. Energy is spent securing the blockchain, not per transaction.
Another major error they made, is that they assume that Bitcoin mining uses grid energy and assume that it follows the CO2 emissions of electricity generation in that country.
This is completely wrong. Most mining happens currently on underutilized hydropower stations, because grid energy or fossil fuels wouldn't be as profitable. Because of the mining difficulty adjustment and diminishing returns in improving ASIC hardware, the only way to profit is to find cheaper energy sources than all other miners.
In the long term, Bitcoin mining accelerates the development of abundant and cheap energy, which is not fossil fuels.
> In the long term, Bitcoin mining accelerates the development of abundant and cheap energy, which is not fossil fuels.
Yes, but does it reduce the total reliance on fossil fuels? If we start with X coal plants and build a Y hydro plants to support btc mining, we're still running the original X coal plants.
I suspect by "develop" the parent comment did not refer to the construction of power plants but to the improvement of the technology. Like in "Research & Development".
Have you got any non-trivial examples/plans of that happening beyond btc mining speeding up the existing "we need to solve this so fewer people die" process?
Bitcoin mining can possibly finance the building of new solar / wind farms without government subsidies. In time, mining will become less profitable and it makes sense to sell the energy to grid. Obviously, fossil fuel energy should be taxed more heavily to get rid of it faster.
That sounds like trickle down economics idea. It's possible of course... But is it more likely than people taking out their btc gains and buying a yacht instead?
Not sure why this is downvoted. I have a friend whose primary reason for mining was that he shared his electricity bill with the restaurant downstairs so it was very profitable for him.
Same reason why goldbugs votedown Gresham's law. It's not comfortable for someone to call out your world view, especially with centuries worth of observation to back it up.
>This is completely wrong. Most mining happens currently on underutilized hydropower stations, because grid energy or fossil fuels wouldn't be as profitable.
This is really interesting. I wonder if we could invent a coin that can only be mined through renewable energy. This could be the incentive people need to move off of carbon.
The good thing is that renewable is the cheapest source of energy, which means that Bitcoin is that coin. However, it depends on location, and currently hydropower is the most lucrative if you can find an already built, but underutilized plant. Bitcoin gives away $250,000 to miners every 10 minutes, which is a good incentive for new energy developments.
That is only really accurate if the electricity used would somehow disappear were it not for the mining. Electricity (minus the energy lost in transport etc etc) is zero-sum. If the miner uses hydro, that means someone further from the dam is using coal, methane etc as the hydro company isn't selling excess on the grid.
Energy is finite on the grid, so yes mining takes energy which could have been used for (arguably) better purposes
Not here in Iceland we have more electricity than we have use for, it goes to bitcoin mining or it goes to aluminum smelting. No connection to the outside world grid.
Furthermore, they assume that Bitcoin will follow "the adoption trends of other broadly used technologies", which is unlikely to happen. Even the cryptocommunity is starting to accept that Bitcoin has effectively failed as a payment network.
Bitcoin has value because people want it. People want it because they predict it will increase in value. They predict it will increase in value because it increased in the past.
I have no idea if or when that circle will break but I can't believe that it will last I definitely.
I'd assume at this point people want it as a hedge against inflation tbh. So people want it so their fiat money won't decrease in value is more accurate.
I thought it was more of a crypto lottery frankly. A whole bunch of people started buying it and it's become like this gigantic game of chicken, where you don't want to be left holding worthless BTC.
If we hadn't just had lots of institutional money moving into Bitcoin within the last year (see https://bitcointreasuries.org) I'd be inclined to agree.
However I don't think institutions of this size and nature buy millions of dollars worth without some sort of analysis and strategy.
who knows what those biggies do, I'm sure they don't publish their moves out in the open like this nor do I think they hold actual coin. They're probably just holding option positions on CBOE and CME.
> Bitcoin has effectively failed as a payment network.
To fail, all of the 2nd layer networks have to fail, and it has to keep its position of a store of value, keeping transaction costs out of reach of regular folk.
If tomorrow there was a big price crash back to $1, and all transactions dried up, it would have a 2nd shot at being a payment network.
I don't have proof for the larger community but I was very interested in bitcoin at 2012-2015 and it really did seem like it was going to be a real alternative, all the big companies were starting to accept bitcoin but now its all gone.
Almost nowhere accepts bitcoin anymore because they failed to solve the issue that transactions cost on the level of dollars to process so its only useful as a speculative investment and not a practical currency.
In hindsight it makes a lot of sense. The cost of a transaction for Bitcoin is always going to be higher than just updating a value in Visa’s database. Visa may have some increased costs due to consumer protections, but consumers are pretty clearly willing to shoulder the cost.
I have never heard of Cardano and Ethereum seemed to market itself as a way to run the internet and government inside of blockchain while the reality was it was never used for anything but speculative investment.
Cryptos have basically burned the idea and the general public will probably not care of any future solution since all of the previous ones were scams or not very useful.
These cryptos all promise the world and deliver nothing.
For example, Uniswap is a decentralized exchange living on top of Ethereum that frequently has volume higher than Coinbase. A couple years ago that was the "end vision". Now it's an everyday reality.
Loans, mutual fund like assets, lending etc. The ecosystem is booming.
If everyone else is getting the same dozen daily scam emails related to Ethereum that I am, I'd have to assume that it has irreparably harmed the currency's reputation.
The price surge we're seeing and have seen. More and more people are holding BTC like gold, so when the value rises their pockets get fatter. Not for any payment, just investment.
I even see it myself, and I don't speak for anyone in that community. I bought some BTC ~4 years ago to buy something and did the math on current value. It's kind of shocking.
The number of transactions are limited by block size though so each completed block has a maximum number of transactions it can include.. also securing the blockchain isn't an end unto itself it's only really useful when it includes transactions.
The true statement is "We consumed this amount of power and were able to process this amount of transactions" but the power usage does not scale with transactions. You could increase the block size and get far more transactions without changing the power usage because the power is not used to process transactions.
Its technically very simple but politically very difficult. The point I am making is that the power usage is not directly tied to transactions. Not making a transaction on the blockchain will not save X watts because that power is burned regardless of what transactions are going through.
An example would be that me not driving to the beach saves some fuel but bitcoin is just a train constantly driving to the beach and back regardless of how much I use it. You could grab the number of trips and the power usage and calculate a power usage per trip but its not an entirely useful metric since the power usage does not scale up as more people use the service.
Segregated Witness (SegWit) was activated in July 2017. https://en.wikipedia.org/wiki/SegWit And overlays like the Lightning network have been in use for even less time.
The amount of energy spent does not depend on number of transactions nor how much is needed to secure the blockchain, it's purely determined by how much miners are willing to spend, which is mostly determined by the bitcoin price. So, if you would expect the amount of energy spent on mining to scale with any variable, it would be trading price and price alone.
Also, it was not published in "Nature", it was published in "Nature Climate Change".
Now "Nature" (the publisher) has many journals, and many of them has a name that starts with "Nature", but they are different journals, with different teams and different qualities. https://www.nature.com/siteindex#journals-N
That assumption is wrong. Take it as a single data point about the reliability of their peer review process. EDIT: I really mean that is a single data point. A usually reputable publisher can make mistake sometimes.
Yes, see, here we have respect for science only if a) it is our specific field, or b) fits average tech bro sensibilities. Obviously, we are completely objective and not emotional or biased, because we know JavaScript.
That was my question; glad you saw it; it's still unanswered; providing testable evidence for a claim is another basic principle of science; if the article or the reviewers are wrong, the top commenter has to give them a chance to recognise that by providing evidence for review.
I wouldn't publish the results of my multi year scientific effort on a platform "anyone" could make changes. Reviewer are expected to have a suitable qualification and experience and no bias. The publisher knows the reviewers and can select suitable ones. In a wiki, where anyone can publish or change anything without control, the scientific level - at least in certain areas - will inevitably level down. There is no perfect system, but there are many worse than we already have.
Is that a joke? Have you ever been in academia? Bias is everywhere. Bias towards certain hypotheses, political outlooks, methods, etc. The more senior someone is in a field, the more biased they tend to be! I've seen the founder of a field vote to reject a paper because it was "already known" because he skimmed the paper and misread it. There are entire fields of Alzheimer's research that are suppressed because they don't work with the Field's Favorite Aggregating Protein. I've witnessed people add spin to the conclusion section of a paper so that it looks less politically incorrect, and I've also witnessed that this step is both necessary and effective for getting a "dicey" paper published. Get out of here if you're going to assert that scientists are these objective Vulcan types that are "above the fray". They are some of the most "biased" and opinionated people in existence!!
Yes, did several studies and also a PhD with a Nobel laureat and some publications. I don't claim our present system is perfect; it's far from it; but I don't know a better one; thus my question: Do you have a better concept?
There are plenty of other options, the one I'll focus on is already is in widespread use: science seems to progress fine using only preprints. It is the norm in physics and becoming the norm for biology to read the preprint of a paper long before it is published in a journal. Official peer review adds very little value over this system.
But it cannot always remain a preprint; at some point the author must decide on the definitive version and publish it; citing a preprint is also problematic if it is in fact a "moving target"; preprints, however, have a decisive advantage: one has published more quickly and can make subsequent corrections.
EDIT: Preprints are actually not a replacement, but essentially loosen the submission deadline and increase the number of (potential) reviewers. But even with this, many disadvantages you criticise still exist; the public reviewers not appointed by the publisher can also be wrong, and the outcry of indignation can be so loud that the author's superiors enforce a withdrawal of the publication.
>I wouldn't publish the results of my multi year scientific effort on a platform "anyone" could make changes.
Publishing is taken far too importantly in academia
>Reviewer are expected to have a suitable qualification and experience and no bias
But they do not. My last paper was rejected when the reviewers hardly understood the basics of the topic. And I have been assigned papers to review about topics I have never worked on
>In a wiki, where anyone can publish or change anything without control, the scientific level - at least in certain areas - will inevitably level down.
Not every edit needs to be approved
Open source with pull requests was not so bad for software quality
>There is no perfect system, but there are many worse than we already have.
The current system is especially bad. It takes to much time to find the papers, read the papers, write the papers, and review the papers
And how is that supposed to help us in this case? It doesn't have to be a "replacement", but at least some suggestions for improvement; just rejecting without any suggestions is not constructive.
It's a mistake to assume energy source composition too. I would guess that a majority of mining is renewable right now (mining is a perfect sink of intermittent excess energy, and because its profitability is related to energy cost, renewables win). More so in the future.
The capital expenditure is sufficient that it still makes sense to run the miners 24/7 and not try to take advantage of cheap electricity - although that does matter somewhat when deciding where to place the data center.
This is true of pretty much every industrial process. The idea of running production only when the sun is shining to absorb excess solar seems like a universally poor idea.
Rarely industrial process can switch on and off randomly and still scale revenue linearly.
The capital expenditure argument makes sense when mining is the primary business. Using old and otherwise unprofitable (but cheap) hardware makes sense where there is intermittent excess energy.
The amount of energy wasted depends on how high the block reward and the transaction fees are. The block reward is going down over time and transaction fees are unlikely to grow beyond a practical maximum.
Transaction fees will have to go up to compensate, else Bitcoin will become insecure as its resistance to 51% attacks falls below critical levels. See discussion at [1].
It's worse than that. The assumption is that Bitcoin transactions eventually become the world's payment system. Then this is multiplied by Bitcoin's very inefficient work per transaction.
ok, but I can't help but think there must be some relatively negligible energy cost per transaction that nonetheless might be not so negligible when total number of transactions added together - what that energy cost is I wouldn't be able to say.
Welcome to progressive politics. Science and logic do not matter. They will use climate change to take your chosen store of value. Because your chosen store of value reduces their power over you. Pretty simple, really.
Note that three articles were published in response to this one (linked as 'Matters Arising' in the top part of the article), and they all appear to criticize the methodology that was used here.
The key objections from the first such article [1] are as follows (quoted verbatim, though the article itself obviously contains more details):
> First, the use of transactions as the driver of future Bitcoin emissions is questionable, given the tenuous correlation between transactions and mining energy use...
> Second, all three Bitcoin adoption scenarios designed by Mora et al. represent sudden and improbable departures from historical trends in Bitcoin transactions...
> Third, Mora et al. applied outdated values for mining rig efficiencies and electric power CO2 intensities, which inflated their estimated 2017 Bitcoin energy use and CO2 emissions values considerably.
> Fourth, by analytical design, Mora et al. applied 2017 per-transaction energy use and CO2 emissions values in all future years, multiplied by annual transactions... This decision effectively held both mining rig efficiency and grid CO2 intensities constant for the next 100 yr... This unprecedented choice ignores the dynamic nature of mining rig and power grid technologies and violates the widely followed practice of accounting for technological change in forward-looking energy technology scenarios...
> Fifth, in constructing their scenarios, Mora et al. committed key errors when analysing adoption rates within their 40-technology comparison pool...
One thing that is interesting though is that it seems like BTC mining would increase with the price of BTC. If each BTC is more valuable, it becomes more feasible to use more energy on mining rigs. Am I wrong?
One of the many reasons why we need to get over our fear of nuclear power (speaking centric to the U.S.) and focus on safety innovation in that area. It could solve the energy and pollution problems quickly and efficiently, making things like this a non-issue.
The whole global warming and climate change problem could be solved (while also stimulating the economy through job creation), but economic and political incentive to not solve the problem thwarts any real progress.
If you're curious or skeptical, it's worth considering the arguments of people like Michael Shellenberger[1] and Alex Epstein[2].
> it's worth considering the arguments of people like Michael Shellenberger
I'm sympathetic to the argument for nuclear energy as part of the answer to global warming, but... Schellenberger? No, sorry, it's not worth considering his arguments for anything. His arguments go like this...
- We don't need to worry about the Amazon burning and being cut down because it's not actually the "lungs of the world"
- We don't need to worry about sea-level rise because the Netherlands
- Burning wood is much worse than burning petroleum, so let's keep burning petroleum
Etc. Schellenberger is an idiot trying to be an iconoclast... and failing miserably because the icons he's tilting at are windmills. Let's leave Schellenberger out of this.
The guy is a troll. The last nuclear power plant built in the US took 40 years to come fully online and has never made money. Meanwhile solar is going through a moore's law like cost reduction and is cheaper than coal in most places.
Geothermal has a much better chance of supplying baseload power than nuclear does at this point.
No disagreement about cars. Bikes and bike infra are cheaper, healthier and less deadly in all senses of the term. Electric bikes are great too. So are three wheelers.
But that is whataboutery: bitcoin is still extremely bad.
Yeah, but ask yourself: why are you reading this _now_?
The article is 2 years old. Bitcoin and the overall cryptocurrency ecosystem are near all-time high values. Shining a light into this article is probably a maneuver made by someone interested in decreasing the value of Bitcoin. It's possible that this person is a concerned environmentalist, but Occam's razor suggests that this person is someone that wants to buy Bitcoin at lower prices, or that shorted its value in an exchange and wants to increase the benefits before executing the options.
Of course, find somebody to loan you some coin, sell it at current prices, buy some in a week when prices fall and return the coin to the lender, pocketing the price diff. Any fungible product can be shorted, all you need is a willing lender.
Prediction, Bitcoin (and decentralisation in general) will be attacked as a vessel for circumvention of financial establishment right-wing censorship next. We must regulate it to prevent fundraising for another insurrection.
I'm not condoning the narrative, rather the opposite. Technocrats will attack decentralisation as it threatens their hegemony. My claim is they'll sell it under the guise of preventing domestic terrorism.
Yep it’s fud. For those who aren’t aware let me let you in on a secret. Some people who hold crypto push fud for the coins/tokens they hold to make others not buy them. This seems counter intuitive but gives people whose cash flow is low a longer period to get a decent stake. Then you have sad 4channers who do it just to be mean. Beware the fud. If people are pushing a negative view in something always ask what’s in it for them.
Nothing in life is free. While I concur BTC mining is expensive (and I'm a huge fan of movements to Proof-of-Stake (Vitalik is a genius)), I'd love to see a comparison to the movement of gold. Large sums of gold are regularly moved on passenger planes, not to even start on the environmental cost of minting, coining, holding and protecting gold stores.
All energy expenditure == global warming, but that doesn't mean no energy should be spent. As one of my favorite humorist/economist/lecturers, Jeffrey A. Tucker, somewhat trolling-ly put it: "Sometimes conserving is not a good idea. There are some life activities that cry out for the expenditure of resources, even in the most generous possible way."
> Large sums of gold are regularly moved on passenger planes, not to even start on the environmental cost of minting, coining, holding and protecting gold stores.
Citation sorely needed. A "large sum" of gold would fit in a small suitcase. Who the fuck is filling airplanes with significantly more than that, save for exceptional circumstances?
Most "store of value" gold sits in vaults around the world and is never moved. When ownership changes because someone buys a gold ETF, it's just bits moving around in a database.
Ugh, no, gold is used in electronics, aerospace materials, even to treat arthritis. Even if no one ever used it as currency it would still have properties that make it useful.
I think the difference is that bitcoin mining is an intentional race about who can spend the most energy.
You can argue about how useful it is to move gold, but at least it's a physical process that requires a well-defined amount of energy - and can be optimised if you want to spend less.
With bitcoin, there is no set amount of power that is needed to mine a block. The answer is literally "as much power as possible".
IIUC your point is that energy is wasted in the mining process. But I am not sure you can say it is a competition for who spend the most energy... Is power consumption linear with computing power, I am curious. Anyways, just as gold moving, computing power can be optimised for energy efficiency.
Also it would have been better for OP to compare not with gold moving but with gold ... mining, an extremely energy hungry ans environmentally destructive industry.
In bitcoins case the incentives are such that it’s power consumption that’s essentially being measured.
Now let’s say that someone would make a chip that would use only 10% of the power of the current ones. What do you think would happen: People would keep current hashrates and just consume 10% of energy.
Or:
People would scramble to get these chips and keep on burning the same amount. As your rewards are basically due to your ratio of the total hashrate. Not any absolute amount.
It's actually like that with gold also: the amount it costs to mine/refine an ounce of gold is always almost the same as the value of an ounce of gold, because whether or not it is worth exploiting a marginal deposit depends on the value of gold.
Should read: every action (including inaction) has specific, inescapable consequences.
The question is: what matters more? Is the cost worth it?
No one needs bitcoin. No one. You might argue that we need a viable currency, but the two are not equivalent.
What everyone needs, without exception, is a functioning biosphere.
I agree with your humorist. Now is a perfect example of a time when we need to be expending resources and capital on saving the planet. Generous? Or just adequate?
How about a comparison to something electronic, like a credit card transaction? This is (purposefully?) derailing as I don't think a single person is suggesting gold coins is a better alternative to BTC.
My understanding of the world suggests that the value of gold and the value of bitcoin are equally "imaginary". Should humans not spend energy on their imaginations?
Usefulness is quite relative. Do we really need jewelry to signal out social status to others ? I personally don't think so. (Industry only uses small amounts of gold)
That's not quite what I'm saying. Gold is intrinsically useful because you can do things with it, regardless of what those things are. Whereas literally the only thing you can do with Bitcoin is trade it to someone else.
Not anything can be a means of exchange. For that it has to have some physical properties (transportability, fungibility for example) and social properties (value !) or else you are relying on third party procedures to keep count ... or a public unfalsifiable record like a blockchain.
Well, yes, but that completely misses the point. Bitcoin is currency, and you can reason that all currencies solely have imaginary value. We only value dollar bills because of an intricate system of promises that assures us we can exchange them for things. Bitcoin is no different.
Ooh I only disagree about bitcoin having imaginary value. I believe a bitcoin has real value, because we have chosen it to have real value, much like we collectively chose the USD to mean something.
I don't have any real opinion on the environmental effect of bitcoin, if we do that then maybe we should start thinking about the environmental effects of javascript.
All of these posts are false equivalency until we are willing to compare energy usages of other "frivolous" uses.
How about
* Video games
* movie viewing
* 2.0 phone apps no one wants
* the entire payments industry
* banking energy consumption with all facets factored in (human resources, commuting, logistics)
I find this kind of argument bizarre - if something is valuable to humans they will use energy for it whether it's for transportation, watching the Kardashians or mining Bitcoin. Saying one application of energy is moral and another is amoral neglects that people essentially vote with their time and energy what to consume it on.
If an application that uses a lot of energy is very valuable to people than it's a competitive advantage to also service that need with cheap energy.
Having sound money is not at odds with the environment.
People don’t vote with their time and energy, they often vote with their wallet regardless of the impact on energy and the environment which is the issue. See: Negative Externalities.
The problem with Bitcoin is that energy waste is inherent in its design. As Bitcoin value goes up, the value of a Bitcoin relative to energy changes, which encourages more mining, which results in higher energy spend and emissions as the algorithm difficulty adjusts to the new hash rate.
Generating 10,000,000 bitcoins could be done at low energy with a few miners - but the more valuable they become the more energy they use.
My issue with Bitcoin is that while other industries try to save power, Bitcoin tries to waste it and waste is built into the algorithm.
And the more popular Bitcoin gets, the more our planet gets polluted trying to make magic numbers on a ledger.
What you call energy waste others would call effort. Money should be hard to produce otherwise you end up with central banks putting magic numbers on balance sheets
You can’t choose the kind of energy Bitcoin gets made with. It’s produced worldwide and mining moves to wherever energy is cheapest, which ends in a race to the bottom.
> What you call energy waste others would call effort
This is my whole issue with it - effort doesn’t have to be tied to wasting energy, but it is in Bitcoin. Why would people call wasting energy ‘effort’ in a system where wasting energy wasn’t intrinsic to the system itself.
Nobody has been able to come up with an equivalent alternative. The closest seems to be proof-of-stake instead of bitcoin's proof-of-work, but the security becomes weaker (which is basically the whole purpose of bitcoin), see https://bitcoin.stackexchange.com/questions/70807/how-does-p...
Is PoS strong enough to still be 99% as useful?, I don't know, these are all experiments
It's not wasting energy, it's consuming previously wasted energy. In fact it puts a floor under energy prices so that it rather than wasting energy that you can't get to consumers you can instead use it to mine bitcoin.
How common is it for the central banks of currency sovereigns to indulge in massive quantitative easing? If anything, they're far too reluctant to do so (even during recessions) precisely because of the kind of superstition on display here that money shouldn't consist of just a "magic number" - as if Bitcoin were any less of a token.
Apparently when a government when a government adds money based on economic analysis it’s BAD, but when an algorithm generates new magic bitcoins at an arbitrary rate set by satoshi every 10 minutes that halves every so often it’s REVOLUTIONARY.
What guarantees to you that governments add money based on economic analysis?, but most important, what makes you think that decisions made are aligned with your values?
Venezuela is the living proof of a government that makes decisions with the only objective of keeping power, WHATEVER IT TAKES, even if it means to the reduce quality of live to a 10% in less than a decade.
So bitcoin, and many cryptocurrencies, are at least neutral in monetary emission. Yes, it's not based on economic analysis, therefore is sub-optimal, but equally predictable by every actor, full transparent, no possibility of inside information or conflicts of interest.
Venezuela is an excellent example of a government unable to issue money arbitrarily, because they pegged their currency to the US dollar and accumulated debt in a currency over which they had no control.
AFAIK Venezuela has never pegged the bolivar to the US dollar. But the government did issue bonds in US dollars, I suppose those are the debts that you are talking about
I wish people who complained about governments adding money at least understood why they should be angry. Instead, they are just angry because they want to be angry at something.
I’d argue that “valuable for humans” is brushing over something: is Bitcoin valuable for humans as a collective or is it valuable for a small minority who stand to gain from it?
From my view, and despite the initial promises of Bitcoin, it’s being used by people of means to get even more money than they already have.
If you're in Venezuela, Argentina, Lebanon, Turkey, Nigeria, etc. where your government is stealing your savings via massive inflation it's pretty useful.
It would definitely be better if the learning curve was shallower and the UI's easier, so that more people could be saved.
If someone figures out a way to do it, then sure. Mining ensures that no one in the system is able to get a new monetary unit below the market price as well as making tampering with past transactions uneconomical. Ultimately it's a very elegant solution to what was a long-standing problem.
The system pays for itself via transaction fees, which are used to "lock" the transaction history in a completely decentralised way.
But do people in Venezuela etc. really need all the requirements of Bitcoin? E.g. having to deal with a central authority other than their own government could still be an option.
The most popular method in Venezuela right now is cash-dollars and then zelle transfers, and zelle is only available to those who have overseas bank accounts, everybody else is mostly screwed.
Bitcoin is very useful to those who understand it, but if it weren't so hard to understand to common people it would be an even greater success, it would be a practical option to those who have internet and smartphones, that's still a minority in the country, but not as much as zelle.
Despite that almost everyone have heard of bitcoin in venezuela, another big reason for the undeveloped potential of it is the black-mailing from local authorities to anyone they knew had bitcoins, mostly when price went up fast. There's fear in letting know authorities you have cryptocurrencies.
I'm not in Venezuela anymore, but I still use bitcoin on a monthly basis to send money across borders to my family.
And the security of it gives me a guarantee not offered by anything else, by far!!!. I won't get my money blocked, like it happened to me with a US bank account, for trying to spend all of my money at once (~2k$).
So theoretically a central authority should be able to offer all of that, but in practice, they're all made of human being's decisions, which rules change from jurisdiction to jurisdiction, and susceptible to whims. In other words, unstable and not trustworthy. We have also lived what those central authorities can become
Once you've understand how truly secure money can be, it's hard to go back.
Maybe they do maybe they don't, it's impossible to tell other people what they need. The best you can do is educate them on the options you think could help, people will ultimately make their own decisions.
I'm a dual citizen - my family lost their savings in Lebanon because of banking capital controls. That story is not unique to our generation or history more generally.
Depends on what you count as long term, but based on the 10-year graphs on WolframAlpha? I’d prefer Lira.
It’s not that I don’t regret not putting £10,000 into BTC when it was worth $250/coin (I absolutely do!) it’s just that I expect that degree of variability to work in both directions.
Even if I wished to pay an entity that I was banned from paying by my government or my bank, the very fact that it was banned would make me worry about being defrauded.
The alternative of stack-ranking what constitutes a good or bad use of energy doesn't seem particularly feasible to me. If energy is cheap, abundant and clean you don't need to create such good/bad energy list.
Denmark, famous for its wind farms and for having too much renewable energy at times, only has 6.1GW of wind capacity, which is is a few gigawatt short for the Bitcoin network.
So no, there isn't an abundance of energy when you decide to throw it all away as fast as you can.
That's not the situation we're in though. It may be fairly abundant, but neither cheap nor clean on average. And we're still decades away from closing the most polluting sources.
Also because of how the Bitcoin algorithm and economics work, if energy is cheap then the market will scale up mining thus the Bitcoin algorithm will scale up difficulty. Cheap energy results in more energy waste from Bitcoin.
How much energy is moral to use in pursuit of “sound” money? Maybe Bitcoin hasn’t crossed the threshold yet. But I disagree that we should completely sidestep that conversation.
Personally I'm mining on my new gaming PC right now instead of running my heater when I'm not doing anything intensive. I wonder if decentralizing the hardware into people's homes or putting it in very cold places that need to generate heat during winter would be a way to cut down on some of the excessive waste of energy and thus emissions.
EDIT: Some good points down below WRT heat pumps. I have a window unit AC/Heater for just my room so that I don't need to run the whole house's AC/Heater the vast majority of the time. I'm not sure about heat pumps in such a small scale. Would it be more efficient to run a heat pump for a whole house than to mine to heat my one room?
It depends. Only if your (resistive-pump) cost difference is lower than your Bitcoin gains. That will depend on your geographical location though and the current BTC price.
>I wonder if decentralizing the hardware into people's homes or putting it in very cold places that need to generate heat during winter would be a way to cut down on some of the excessive waste of energy and thus emissions.
This is already being done, especially the latter, in part because cooling is cheaper in cooler climes. Also some geothermal power is cheaper as well.
And, anecdotally, I know at least two people who have installed bitcoin mining farms under their floorboards and use them to heat the house in the winter. I assume there are more.
Lol. Well, I'm also making money at the same time, albeit only about $10/day. So I get to ultimately reduce the price of the hardware and not pay to run my heater.
Official sources say trees can absorb 3Gtec per year. That’s what we emitted in 1990. Since then we increased emissions by 2.5-3. So we need to divide by 3. And more than that, because what is already emitted is already warming the atmosphere.
So we can EITHER choose between heating our house, having a car or travelling once London-NYC per year.
We won’t reach it if everyone is finding excuses.
- You need to isolate your house so that human heating is enough to warm it up.
- Why is anyone even living so far up north. Barely no-one was living in Sweden in 1900, so why do we have to invent schemes so that you can do it (at great energy expense) when clearly, nature wouldn’t allow you to do it?
- Unless all the figures of IPCC scientists are fake, which I’m starting to doubt about, because I’ve studied feminism and I know it is possible to persuade an entire country of false figures. Let’s call that the “mass science” effect, where processes can be twisted in order to gain political leverage.
But if the “mass science effect” isn’t here, you sure shouldn’t think that using mining as a decent offline activity for your computer is a viable solution.
Pretty unrealistic standpoint here. Might as well not even try.
I’m using resistive heating in smaller rooms and it cut my gas usage to near 0, saving me almost 50% in electric and gas costs.
This is the only way to make people change their behavior: show them another way. A realistic way, and make it cheaper or otherwise more desirable for them in shorter timespan
It is unlikely that a GPU is an efficient heat source.
Cryptomining should be done on green energy, or not at all.
Generally, we should move away from proof-of-work based currencies.
> It is unlikely that a GPU is an efficient heat source.
This is plain wrong. A device that consumes N watts of power (and doesn't output electricity or some other form of energy) will eventually produce N joules of heat per second.
This is actually an interesting idea...
We could power Bitcoin mining with solar energy, and then generate thermoelectric power with the heat it generates.
As I understand it, Bitcoin mining rewards are now so low that it's unprofitable to use fossil fuels to mine -- you will pay more for the electricity than you receive through the reward. Hence a lot of people moving their miners to somewhere in the world with unused excess renewable (e.g. hydroelectric) power and setting up there.
You may have missed the fact that bitcoin went up in price by a lot recently. Whenever that happens, bitcoin mining usually becomes a lot more attractive for a while.
For a "professional" miner, price swings are irrelevant. The same quantity of bitcoin is mined independently of the price. Bitcoins mined in March are worth the same of bitcoin mined today even if price is 10x now. And in March the same hardware mined more bitcoins than now.
Big miners are datacenter sized now, and such things are not built during a bull run.
> somewhere in the world with unused excess renewable (e.g. hydroelectric) power and setting up there.
It's true that miners are relocating to locations where energy can be purchased at lower prices.
It's not true that there are large reserves of unused, excess power that would otherwise go to waste if not for these miners putting it to use. Power companies everywhere are experts at sending energy around the interconnected power grid.
Miners running profitable operations have zero desire to establish expensive mining operations and only run them in narrow windows of excess energy capacity, such as peak wind and sun days.
The narrative that mining is relegated to purely unused, renewable energy capacity is an attempt to whitewash the massive power sink that is cryptocurrency mining.
So 72 TWh per year in electricity is between 3 and 5 billions of dollars. Which is a lot, but the question is — should it be compared with electricity bills and environmental footprint of Visa Inc. or with a budget of U.S. military?
I don't think this would really make a difference: Even if miners work only with renewable energy, they waste energy that could be used for other things.
I think the unique thing with bitcoin (and what offsets them from other large-scale energy consumers) is that the technology is intentionally spending as much energy as possible - at it's core, bitcoin mining is quite literally a race about who can access the most energy.
As such I see the environmental danger in bitcoin in a potential to undo efficiency wins everywhere else: If we make the rest of the economy more energy efficient, then the surplus energy could be used to grow the economy without impacting the climate or might not even need to be produced at all. Now there are incentives to dump this energy into crypto-mining instead.
Actually this ramping up and down when the price is profitable is good for utilities who need to keep power supply and demand in check. When electricity is cheap to produce, they need demand to go up to balance the grid - sort of the opposite of peaker plants when demand outpaces supply. This is partially why a few electrical companies run their own Bitcoin mining farms.
Or they could invest in storage technologies so that the surplus electricity can be given back when there is excess demand instead of simply vanishing.
> The network produces 11.27 kilotons of waste annually or 96 grams of electronic waste per transaction. This is the equivalent annual e-waste as several small countries and equivalent to the waste of 482,456 people living at the German standard
I didn’t realise miners were that sensitive to electricity pricing. Does this make a 51% attack easier if you can spike power prices in key mining regions?
Also is there a good graph somewhere showing BTC online mining capacity over time?
Exactly. Every article about this seems to cut corners when it comes to this very thing. Even in this one, the small print admits that they averaged the amount of CO2 produced by power plants in a given country, skipping over the fact that cryptocurrency farms will gravitate towards cheap energy sources for obvious economic reasons, which makes them much more likely to be using hydropower than coal, for instance.
It doesn't matter for a limited supply of energy. If we have hydro power available as well as coal, Bitcoin miners being located near hydro means that they hog that supply. Energy that could supply other uses is now not available and uses which previously relied on coal still rely on coal (because the usage only creeps up).
> Sichuan, second only in the hashpower rankings to Xinjiang, is a province characterized by a massive overbuild of hydroelectric power in the last decade. Sichuan’s installed hydro capacity is double what its power grid can support, leading to lots of “curtailment” (or waste). Dams can only store so much potential energy in the form of water before they must let it out. It’s an open secret that this otherwise-wasted energy has been put to use mining Bitcoin
China already built 2 of the longest transmission lines in the world (~2000km), so location doesn't seem a huge issue. The question is - is the extra energy not being transported because there's an existing use for it (btc), or would it be generated and not used anyway. Or would the power plants just get shut down otherwise?
they are mostly in western chinese provinces like yunnan and sichuan where hydroelectric power is common. Miners in (inner) mongolia are using geothermal.
Since when does anyone have to use a gas-powered car instead of riding a bike?
Since when does anyone have to heat their house instead of wearing more layers when it gets cold?
This idea that Bitcoin could potentially use only renewable sources of energy is a popular narrative among Bitcoin circles, but it flies in the face of common sense. Crypto proponents keep circulating stories about miners using excess renewable energy, but we all know that this isn't the norm.
Governments could pass laws tomorrow requiring all crypto mining use 100% renewable energy by a certain date, just as like they are doing with cars. They could also pass minimum efficiency standards for mining, just as they do for heating appliances. I for one would welcome both moves. Even though your points were meant as counterexamples, what they really illuminate is that the crypto mining industry needs proper regulation, just like cars and heaters.
Transactions are what makes Bitcoin useful (in theory) for "normal people". Thus it is fair to evaluate the entire Bitcoin network in terms of how much energy it takes versus (i.e. divided by) how many transactions it handles.
First think you read is that OP doesn't understand economics and thinks Bitcoin is air. End of reading.would be so much better f he made an argument about ecology and his his biased beliefs about what society should use for money.
Bitcoin doesn't waste energy. Bitcoin consumes energy waste.
The global market for adding bitcoin blocks is as competitive as it is possible to get. No barriers to entry, no one even has to know who or where you are. As such only miners who can secure the cheapest energy survive.
Excess hydro capacity in China during rainy season; capturing flared gas from shale oil fields in the US; geothermal in Iceland; any source of stranded or wasted energy.. bitcoin mining will soak it up.
Bitcoin mining using fossil fuels is simply not cost competitive.
This "#hashes => #GWh => #tonnes CO2", is broken logic full of unsubstantiated assumptions made by bitcoin haters.
I think both can be true. Specifically, Bitcoin mining would itself encourage greater energy production; it doesn't merely skim off the excess energy, as you suggest. It generates its own market forces, it's not merely floating above them.
While that's plausible, I'd still agree with the parent comment in general -- it's true that it's not cost-effective to mine using fossil fuels (you would lose money doing it), and this alone requires a different way of talking about the issue.
If you own some resources, under what circumstances should someone else be able to tell you how to allocate/use them?
It's perfectly valid to say that governments should make laws or economic policies to prevent negative externalities like pollution, but that is begging the question of what activity is causing the pollution.
If your bitcoin mining rig is in an area that is powered by a coal power station, then you are indirectly increasing CO2 pollution, but coal that is burnt to supply other customers with power is no less polluting.
Therefore it doesn't seem equitable to single out just one user of the electricity. It is even more inequitable to punish bitcoin miners that use otherwise-curtailed renewable energy for the externalities of non-renewably powered miners.
I agree that the large energy expenditure required (along with other mining costs, transaction fees, transaction latencies, etc.) to maintain the Bitcoin network ultimately makes it non-tenable for permanent financial infrastructure . However, I think the article could have made that point without completely discrediting the value Bitcoin provides by calling it a "collective delusion that value can created out of nothing by convincing greater fools to buy it after you do"...
I believe Bitcoin has served its purpose by being a pioneer, w.r.t popularizing an application of an immutable distributed ledger. However, it's not the one we should use. Ethereum's model (proof of stake) allows for most if not all of the uses of Bitcoin, without the non-scalable energy requirements and transaction costs, along with smart contracts, which have many potentially revolutionary applications (voting, public records, etc.). We could have our cake and eat it too..
Is there some assumption that traditional banking don't consume a significant amount of energy? I think we're all familiar with towering bank buildings full of employees using computers, air conditioners and a range of appliances (alongside their daily commute).
This is without even thinking about banking tech and system infrastructure.
The energy "waste" argument against Bitcoin is really one of the silliest there is. One man's waste is another's treasure.
"Unlike other economic activities, the bitcoin scheme produces absolutely nothing for all this waste."
Does playing video games "produce absolutely nothing?" Some would say so, others would say not, that it produces positive emotions in players. But the entire ecosystem of gaming no doubt "wastes" more energy than bitcoin mining. Who gets to decide, to decree, what constitutes "waste?" That it's ok to engage in certain activities, like gaming, which some people would classify as "waste," but not ok to engage in others.
And the climate change argument as the cherry on top. Time to power down everything then. No more bitcoin mining, no more cars, no more travel, watching movies, it's all "wasteful." Shut it all down.
The scarcity of bitcoins depends on the scarcity of computational power, and at scale that causes all the problems associated with generating energy. But is that the only viable way to generate scarce tokens?
What if there was some objective, necessarily incorruptible and public source of random data, and tokens were generated only when certain values appear? The number generated is adjusted by adjusting the range of those values.
Is such a publicly verifiable random source possible? Some kind of cosmic slot machine, like maybe variations in a pulsar? If it is possible, could it actually be a low power way to mint scarce tokens?
The same random source used to generate the tokens could also be used to randomly distribute them. Is that compatible with the incentive structure of crypto coins?
That's an interesting idea, but I think what proof-of-work (and -stake) provides is an effective Sybil-proof identity system, which your cosmic slot machine wouldn't.
To use a slightly different analogy, imagine that the pulsar variations determined the outcome of a cosmic roulette wheel. What is to stop miners from "betting" on every possible value on the wheel? If winning a spin gives the right to mint some new coins, then the only reasonable strategies would be to make such a blanket bet, or to never bet at all.
Perhaps, though, your system could be coupled with a system that restricts participants to one (public key) identity per IPv4 address. The cosmic roulette wheel would then pick a participant at random who would mine the next block and receive the block rewards.
I feel like there must be a flaw with this design, other than the fact it rewards hoarders of IP addresses. Perhaps the biggest problem is building a device which can run anywhere on Earth and measure variations in a pulsar, but there must be other globally-measurable random number generators that machines could cheaply reach consensus on.
> The scarcity of bitcoins depends on the scarcity of computational power
No, the scarcity of Bitcoin is hardcoded into the protocol. The protocol doesn't care if 1 miner or 1 million miners are validating the blockchain. The number of BTC is the same.
...as long as everyone agrees to use the same Bitcoin, that is. People could simply fork the Bitcoin chain with a different number of maximum Bitcoin and call it "Bitcoin 2". The scarcity relies on Bitcoiners all agreeing to not recognize any other protocol with a higher limit on Bitcoin, which is currently an attractive proposition to all of the BTC early adopters who would profit greatly from forcing the rest of the world to buy their BTC at inflated prices in the future to get anything done.
Ethereum is starting to use Proof of Stake which provides the same security as Bitcoin's Proof of Work but without the energy waste. Over the long run proof of work will cease to be used.
In my point of view, one thing is certain: Technology has advanced since bitcoin was launched. We can do everything that bitcoin can better and more efficiently with newer algorithms like Avalanche consensus¹. Given that our climate is spiraling out of control, i think it is prudent to switch to these more efficient technologies.
The bitcoin community is locked in a stalemate. Hard forks seem impossible. If bitcoin cannot be improved, i hope we will move on to something less wasteful.
So, pass laws requiring crypto mining to use 100% renewable energy? Sounds like a win-win to me -- no greenhouse gases from crypto mining, and lots of investment opportunities for high-power green tech.
The obvious solution here is to use resulting heat for heating. Humans live in a lot of places where you need heating to survive anyway. Currently we use 'dumb' heating, where heat is generated without any useful computation. This can be painlessly replaced with 'smart' heating, when heat is a result of mining. Any home appliance like iron or heater can do some useful work (and even earn some spare change while at it).
Heating with electricity is pretty expensive / inefficient.
This is going after symptoms instead of trying to tackle the real issue - we should find / use a better solution than PoW (such as PoS) for decentralized currencies.
If you are worried about global warming, you don't really have alternatives to heating with electricity. Or you suggest burning some gas, releasing all that CO2 into the atmosphere?
9USD for a single article is a fair bit more affordable than the standard research article price. They normally run from $30ea up to a few hundred, depending on the source.
I'd be curious to know whether a breakthrough in quantum computing that broke cryptographic algorithms that cryptocurrencies depend on could prevent this by making non-quantum cryptography obsolete.
Or am I wrong to assume that there won't simply be new algorithms that are safe from such quantum-based cryptographic attacks?
Employing thousands of human beings and computers and offices for processing simple transactions is wasteful too. Both using a bank (with outdated system) and "being your own bank" cost energy
Yes of course. It's a matter of efficiency. Certainly they aren't doing so optimally.
I'm not even trying to make any claims on magnitude. Just saying it's pretty clear if shipping/housing gold changes to bitcoin, if some amount of finance activity changes to Ethereum or some kind of DeFi, then this is not purely additive. It's replacing, and the article doesn't account for this
How much energy is consumed by AC systems in USA only? How many ACs are in bank branches, supermarkets and all offices? Please somebody compare AC is USA only to all bitcoin miners.
Because every month media are happy to bash on bitcoin energy consumption, but no one wants to talk about working ACs in banks during non-working hours or poor housing insulation like single glass windows or uninsulated bricks. I'm sure these cause more energy waste then Bitcoin mining.
I know Bitcoin is wasting it for nothing as there are faster and zero-mining (and zero fees) cryptocurrencies that eliminated that problem, but please someone with enough knowledge estimate energy waste from AC in US banks during non-working hours.
I enjoyed reading this comment almost immediately after reading one above about how people live in places that are too cold and they should move to warmer climates. Ha.
If someone can make a very low power / overhead consensus model that can defend it self, and preferably free to use then this tech might actually be worthy.
Does no one else see the bitter irony in this coming from a developer with a startup who presumable contributes to the same electricity usage via datacenters and user load?
The idea that banks will dwindle if Bitcoin gets adopted is a serious misunderstanding of how banks actually work and the value they provide to people.
We're just not going to arrive in a situation where common people would voluntarily choose to manage their own private keys and crypto wallets, full stop. Can you imagine your parents forgetting the password to their retirement account and going bankrupt? Or your grandma getting tricked into a phishing scam that immediately and irreversibly sends her entire net worth to a scammer?
Even the average Bitcoin user prefers to keep their money in something like Coinbase rather than try to manage their own crypto wallet.
Likewise, gold doesn't simply disappear as an asset and get replaced by Bitcoin. The strange thing about crypto is that the crypto market cap keeps going up as new coins are added to the market. Cryptocurrency is a chance to create new asset classes, which altcoin developers are more than happy to oblige as long as the demand exists. Does this mean more money (value) is being willed into existence? No, in fact there's a lot of evidence that cryptocurrency is heavily fueled by an explosion in credit and leverage. There are literally exchanges that will let you purchase altcoins with up to 100x leverage right now.
The first two are already covered by online banks. People would still need banking even if cryptocurrency somehow got common. Gold would likely not change - there's still trade based around it and currencies are not bound to hold price anymore really.
I don't understand why everyone is arguing about whether their CO2 emissions are less than from some other source, when the whole point is we need to be carbon neutral within the next 15 years.
Average CO2 emissions per US Citizen as of 2018 is 16.6 tonnes. Go buy your carbon offsets while they're cheap - less than $9/tonne over at cooleffects.org, which is what I used yesterday.
This is one of many reasons why Ethereum is moving to Proof of Stake (PoS) and ditching Proof of Work (PoW). The already functional Ethereum 2.0 chain has Bitcoin's security guarantees for a tiny fraction of the electricity costs.
Bitcoin's yearly electricity consumption is now estimated at $3.8 billion. This must be sustained indefinitely, and is a huge target for regulation and nation state interference.
Bitcoin's "store of value" has a forever price tag in the billions yearly. This doesn't make economic sense.
If Ethereum can fulfill Bitcoin's role as a "store of value" at a much lower yearly cost, I don't see how it would not eventually become more attractive as a store of value.
For a great detailed explanation on why PoS is better see Vitalk's blog. Vitalik views attacks on chains in terms of costs, which IMHO is the proper paradigm to quantify attack costs.
(BTW, the TLS cert looks like it has an issue at the moment).
In 2011 I assumed Bitcoin would transition because PoW's weaknesses were obvious. Unfortunately, the majority of the leftovers in Bitcoin no longer share my sentiment. Electricity consumption is a reason that PoW is the most likely downfall of Bitcoin if they don't transition to another technology. To keep PoW Bitcoin will need to morph into something else, like a semi-centralized "reserve" asset which is not a technology that excites me. A scalable ecosystem where large volumes of economic value can be transferred excites me. Everyday use excites me.
You can "hide" an Ethereum PoS server in your basement. You can't hide the massive electricity usage, transportation, and manufacturing of specialized hardware used in a Bitcoin ASIC farm. The specialization also means there's a huge centralization pressure in the Bitcoin network. I personally welcome (reasonable) regulation, but if I was concerned about regulation as many Bitcoiners tout, PoW would not be an effective way of implementing regulation resistance.
> the ending of the interglacial period we are currently in
If you're worried about the next ice age, I think we have more pressing matters as a species than an event that isn't due for another 23,000 to 50,000 years.[0]
To borrow an analogy, that's a bit like worrying about over-population on Mars 500 years from now, while nuclear weapons are being detonated in enough major cities to annihilate human civilisation in the next 0.5 years.
Irrelevant because wire transfers are only a tiny fraction of what banks do. Bitcoin is not a replacement for banking; it’s a replacement for physical gold. A banking system would still have to be built on top of it.
I love that bitcoin maximalists have now become the ire of the global warming movement. Quite fitting as it literally is the ponzi scheme of our generation helping criminals launder their money. History will not be kind to those who pushed shitcoins, I personally would never ever hire someone who've been associated with such outfit.
Lots of Bitcoin critics really struggle with the subjective theory of value (which is also the basis of Marginalism and modern mainstream economics). Nobody believes in stuff like labor or intrinsic values outside of a few marxist holdouts.
> TLDR on bitcoin economics: It's a pyramid-shaped investment scheme backed by the collective delusion that value can created out of nothing by convincing greater fools to buy it after you do.
Nope, lost me there. I'm all for having deep discussions about Bitcoin and the environment and the undeniable fact that Bitcoin mining wastes energy, but not with a person that refuses to understand how value works.
Things have value if and only if there are people that believe it has value. There is no other principle. No "inherent" value, no guarantees, nothing.
Everything is exactly as valuable as the majority of people perceive it to be. Dollars, gold, food, Justin Bieber, freedom, Bitcoin.
You may not agree, but then it's still happening, only without you.
If you don't sell Bitcoin, you're not the supply and you don't have a say.
If you don't buy Bitcoin, you're not the demand and you don't have a say.
Gold has a modest industrial usage. Fiat is backed by a government in control of resources or a military. Bitcoin is fiat without anyone to guarantee anything.
Considering the impact of mining it may touch everyone we can all make our voices heard. No need to buy or sell to justify expressing oneself.
It is so shameful for people to characterize resource use as “waste” like this. Not surprised to see more sanctimonious nonsense from Stephen Diehl, the same guy who thinks all us programmers not using functional languages are neanderthals still in “the bloodletting and leeches” era of software engineering.
This really is beyond the pale. Stephen sounds like a total crackpot here.
How much “waste” does Pixar’s renderfarm generate when creating artistic cinema that people want?
How much “waste” does Sony’s Playstation Network generate distributing games people want?
How much “waste” does the sum total of plastic surgery create?
I was curious about the actual number; how much energy does Bitcoin use?
> the bitcoin network in 2020 consumes 120 gigawatts (GW) per second.
GW / s. (/year, I suppose, since it's just 2020. But FFS. Edit: no, GW / s / year is GW, but that's still not… really? right? I mean, maybe it's an average of the energy consumption rate over the year, and so on average, in 2020, it was consuming 120GW?)
Uhh no. Stephen is not discussing BTC energy usage. This is sanctimonious, moralistic grandstanding that presupposes “Bitcoin bad” as a moral absolute straw man to set up a nasty, useless screed railing against it.
If there was some legit discussion in it, that would be fine. There utterly is none.
I can't find a single factual statement in Stephen's tweet thread I disagree with. Your use of subjective pejoratives rather than specifics seems to imply that you are the same position.
Your response is deeply unreasonable. Here’s a quote from Stephen’s thread,
> “ Unlike other economic activities, the bitcoin scheme produces absolutely nothing for all this waste. It is a pure speculative activity of people gambling on the random movements of prices and the only output is simply shuffling numbers around in a computer at insane cost.”
That is nothing but complete grandstanding decoupled from reality. It deserves to be criticized with pejorative language because Stephen’s comments are so wildly extreme, inflammatory, and totally disconnected from facts or reality. It meets the literal definition of a rambling screed and needs to be called out as such.
I don’t really think those are fair comparisons. For one, the PlayStation network provides entertainment. I know from a hard economic perspective that might not be “valuable”, but it is. People need entertainment. And I’m sure the PS network is more energy efficient than everyone driving half an hour to a movie theatre, or something.
By comparison Bitcoin provides nothing other than itself. It’s price is almost entirely powered by speculation at this point. To put it another way: if the PS network disappears tomorrow it will have still entertained millions. If Bitcoin crashes tomorrow, it leaves nothing.
Saying that BTC provides nothing other than itself is too reductionist -- indeed the Playstation Network also provides nothing other than itself, the ability for users to play online games with each other. If bitcoin crashes tomorrow, it will still have enabled censorship resistant, peer to peer value transfer for millions. People use it to pay for games, buy things, sell things, donate and preserve the value of money earned in depreciating fiat.
I would argue that BTC has provided significantly more value to its millions of users in its 12 year history than Playstation Network; What is PSN really -- a matchmaking service, and social contact platform. What is a global, peer to peer, censorship resistant, non-government fiat backed economic system worth?
> People use it to pay for games, buy things, sell things, donate and preserve the value of money earned in depreciating fiat.
This is where the argument about energy usage per transaction comes in, namely that Bitcoin is terribly, terribly inefficient at providing this value. From the OP:
> A single bitcoin transaction alone consumes 621 KWh, or half a million times more energy consumption than a credit card payment.
Comparing Bitcoin to a credit card payment isn't really a fair comparison. (Since if people really like the credit card model so much you can build credit card like things on top of the Bitcoin network) A more apt comparison would be to an international wire transfer which costs $15-$40 and takes a few days to complete.
You would have to equalize for speed and transfer fees (because people consume a quite a bit of energy doing things faster and obtaining money) and then somehow come up with some way to calculate all the necessary energy for a wire transfer.
I agree. How much waste do fiat currencies generate protecting their themselves with standing armies (or the alliances with a country that has one)? Far more than the amount of energy used to secure bitcoin currency against other nation states using proof of work.
Iregardless of what ones opinion on maintaining standing armies might be usually it creates significant added value (unlike mining bitcoin) for the economy. All those people in the military or working in industries producing for the military have to be paid etc.
Pixar and PSN provide actual value to some people, while mining bitcoin is completely superfluous (not saying that bitcoin itself is necessarily useless but that the same result can be reached without wasting as much energy needlessly)
No, I said that the value created by bitcoin is not directly related to how much energy is used. Technically the same outcome could be reached with much less wasted energy.
If you can provide the same proof of work features using less energy, you can demonstrably make a lot of money. Can you show me the evidence of that and the specifics of how to get the same block validation consensus security with less energy consumption?
A 2019 thread on Hacker News has the Pixar Renderfarm core count at around 60K. That is...microscopic...in terms of data center scale and energy usage.
So you've built a tiny tower of straw men, attempting to use them to draw a false equivalence between the energy to maintain and expand the bitcoin system.
I suspect bitcoin adherents may also enjoy (along with mining) continuously spraying chlorofluorocarbons into the atmosphere. Big Bad Society does frown on that activity! Increasingly, Big Bad Society does not like the externalities from things like BTC.
Diehl is wrong about speculation being the only use of bitcoin. Investing in crime is the other.
I think the point is that Bitcoin uses an insane amount of energy for what it accomplishes, if one considers only the financial transaction aspect (and not all of the other benefits that Bitcoin might provide - depending on your position on Bitcoin, that may or may not be fair to do).
If someone invented a car that consumed 10,000x as much energy per mile, using that car would generally be considered a waste of resources, or at least a wasteful use of resources.
To continue the abstract car analogy, what if this car that used 10,000x the energy per mile also had some magic properties -- like that anyone could build the car themselves from the blueprints, it could magically teleport anywhere on earth and nobody could tell you where you could drive it (traffic signs are ignored).
"Would that be worth something to you, eh?" -- Scotty
