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Comment by kls | Hacker News Reader

I will admit I am not up on block chain tech or the process it uses, but it does seem like a lot of wasted resources to just compute hashes. It seems like someone could make a system where real work units count as credit in an issuing lottery. Kind of like SETI @ Home, medical or genome work where you distribute a problem and then people get tickets for accomplishing some form of work. Seems to me that this would be a better use of such vast computing power and would help with discovery at the same time. Again it's not my area of expertise so I don't understand the details or issues that would arise in ordering the work units around distributed computation to solve large problems. It would be nice if researchers had open and free access to such a system.

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These are not "wasted" resources; they create value, which is the trust for the distributed currency system. These are hashes based on real history of transactions, and their computations guarantee that these transactions have been recorded by third party.

(At least, that's how it should work if I understand the theory behind bitcoin correctly).

Exactly. It's like claiming that HTTPS encryption is wasted resources, because all you do is encrypt things at one end, only to decrypt at the other.

Bitcoin's computation does the job of securing the blockchain by forcing an attacker to spend computation cycles to match up the computation done for these hashes.

HTTPS encryption doesn't get more difficult to compute as time goes by.

HTTPS is the means to an end, bitcoin is just wasting resources.

If the point was just to maintain the blockchain integrity there would be no need to make its difficulty ever increasing.

> HTTPS is the means to an end, bitcoin is just wasting resources.

Bitcoins is also a means to an end, you just don't seem to understand what the end is.

> If the point was just to maintain the blockchain integrity there would be no need to make its difficulty ever increasing.

This is incorrect. The blockchain requires miners to establish an unbiased ledger history. The difficulty parameter is tweaked so that the whole system can be future proofed against an adversary creating a convincing blockchain history (which was biased to double-spending or retracting a transaction).

> This is incorrect. The blockchain requires miners to establish an unbiased ledger history. The difficulty parameter is tweaked so that the whole system can be future proofed against an adversary creating a convincing blockchain history (which was biased to double-spending or retracting a transaction).

What was the excuse in the early days of bitcoin then when the difficulty was orders of magnitude lower?

Difficulty is ever increasing just because of the financial model bitcoin tries to propagate. The author of bitcoin wanted to make it deflational and so it had to be this way.

That part has nothing to do with the integrity of the blockchain and you are mixing two concepts here: Blockchain, which was a great invention and bitcoin, a financial experience (nothing against experiences from my part) which turned out to be a waste of resources.

> > This is incorrect. The blockchain requires miners to establish an unbiased ledger history. The difficulty parameter is tweaked so that the whole system can be future proofed against an adversary creating a convincing blockchain history (which was biased to double-spending or retracting a transaction).

> What was the excuse in the early days of bitcoin then when the difficulty was orders of magnitude lower?

... because there wasn't as much hashing power in the bitcoin network? Isn't that obvious? The difficulty parameters are tweaked so that the proof of work takes 10 minutes for the whole network. As the network gets bigger, you need to make it harder to maintain a 10 minute proof of work.

> Difficulty is ever increasing just because of the financial model bitcoin tries to propagate. The author of bitcoin wanted to make it deflational and so it had to be this way.

Eh. You're full of shit. But that's your prerogative.

> That part has nothing to do with the integrity of the blockchain and you are mixing two concepts here: Blockchain, which was a great invention and bitcoin, a financial experience (nothing against experiences from my part) which turned out to be a waste of resources.

Integrity of the blockchain is maintained by cryptographic hashes. There are other security properties (such as proof of work and thus non-malleability) that are maintained by the difficulty parameter.

The difficulty does not NEED to be ever increasing. In fact there are periods of time where the difficulty is pretty stable, such as mid-2011 to early 2013, or the first half of 2015: http://bitcoin.sipa.be/speed-ever.png

> bitcoin is just wasting resources. If the point was just to maintain the blockchain integrity there would be no need to make its difficulty ever increasing. <

Higher difficulty don't waste any more resources than lower difficulty.

> Bitcoin's computation does the job of securing the blockchain by forcing an attacker to spend computation cycles to match up the computation done for these hashes.

So we could call this approach to scaling communications, "brute-force messaging"? (..since it also forces anyone who wants to enlarge its available message space to pre-compute hashes ...with an ongoing race condition, so "raced, brute-force messaging"?) Scaling seems a bit off though, since its design enforces "expensive, frantic scarcity". That seems rather limited for a growing population's needs for communications around an increasingly valuable resource base.

> ... anyone who wants to enlarge its available message space ...

Bear in mind that the proof-of-work algorithm actually aims to reduce chatter on the network. Every ten minutes, a single Bitcoin full node broadcasts: "Hey, this is the latest state of the ledger, and you can trust it because [insert proof-of-work that was calculated out-of-band]." So, as the network's processing power scales up, the computation difficulty is also scaled up, so that the "message space" required for consensus remains constant.

> That seems rather limited for a growing population's needs for communications around an increasingly valuable resource base.

While the way distributed consensus is achieved (see "Byzantine Generals' Problem") consumes most of the network's processing power, it's what makes the resource valuable. However, since this is done in parallel, it hardly consumes any of the network's bandwidth, freeing up that "message space" for important things like sending/receiving/propagating transactions, which are much less demanding computationally. All that is required there is some elliptic curve cryptography (ie. a valid public/private key pair + any low-powered device with correct software and an internet connection.)

Check this out: http://filecoin.io/

It's a cryptocurrency where you have to prove that you are retaining a copy of a file. Whitepaper included.

These people are also behind IPFS, the distributed alternative to HTTP (ambitious, huh?)

To be fair we shouldn't look at Bitcoin as "just" computing hashes. Its impact is already wider than that. The OP pointed out:

> the bottom line is that investing a hundred+ megawatt in a system that creates thousands of jobs is a valuable economic move, not a waste

The detail you're missing is that these hashes bitcoin computes are designed to be something easy to verify but hard to compute. Relatively few productive problems have this property, and there are some which are doing this already, trying to crack proof RSA keys and such... but that's about it.

New distributed currency system sponsored by the NSA: breaking RSA keys for profit.

I was thinking more... https://en.wikipedia.org/wiki/RSA_Factoring_Challenge

But yes, that could totally be done! Only problem is everyone would have the result, which I don't think they'd like too much.

The problem with basing a money on something that has value, is that changes in perception of the value of the thing, result in changes in prices across the economy.

Say gold is the currency base. Now we discover Alzheimer's can be cured with a medicine that requires a lot of gold in the processing, and the price of gold skyrockets. That causes the price of everything else (priced in gold) to plummet.

However, I think a compelling case can be made that the amount of hashpower being used to secure Bitcoin is overkill for the measly 3tps that the network is currently capable of. If the same hashpower was used to secure 100X more transactions, it wouldn't seem like such a waste of resources.

I was wondering about that too! And apparently some efforts are underway:

1. https://bitcoinmagazine.com/articles/putting-the-blockchain-... 2. https://www.gridcoin.us/ 3. http://www.coindesk.com/5-global-problems-bitcoins-proof-wor...

> I will admit I am not up on block chain tech or the process it uses, but it does seem like a lot of wasted resources to just compute hashes.

To be fair, the blockchain is the largest distributed rainbow table in history, so it does have some value in that sense.

But arguing that "it is a waste" to use hashing is to not understand the security properties offered by bitcoin and why it's actually vital to use hashes.

A consensus system like Ripple makes a lot more sense. Blockchain and hashing is ridiculous when there are better ways to achieve the goals.

Too bad ripple was premined. They are seeing some success as end points with banks though.

No one cares about "premining" accept miners. They don't care about miners, they care about being in the real world with banks. See what they have done in 2015. https://ripple.com/insights/ripple-2015-a-year-in-review/

This is what they posted about 2016: https://ripple.com/insights/2016-will-be-the-year-you-realiz...

It's probably cheaper (and greener) than the equivalent task of mining up tons of precious metals and storing them in a secure vault.

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