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Comment by alex_duf | Hacker News Reader

The amount of power we're wasting computing a giant rainbow table drives me mad.

We could at least burn coal to compute something useful.

I'm not dismissing bitcoin altogether as it brought a great deal of interesting concepts, in fact I even mined a very small quantity once uppon a time. But right now the whole hashing random number madness is mostly a waste of energy.

I don't think we should afford 1.7GW (apparently 500MW according to a comment bellow) of power as long as we're still burning fossil fuel somewhere on earth.

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Why aren't you mad about all the gigawatt hours that are wasted powering banks, bank servers, armored trucks silly moving fancy paper from business to banks, printing presses, the distruction of various ecological areas to take the mineral gold out of the ground, VISA servers, printing Visa cards etc.

Just because the method to defend against unmodified database entries in the Bitcoin blockchain is very evident and the evidence of ecological cost to our current financial system is largely silent doesn't mean one can ignore those costs.

It's the nature of the computation that bugs me.

We have a network growing exponentially relying on the fact that we're hashing random numbers. Academic research aside, it sounds very useless.

That has nothing to do with the way banks are doing their maths or maintaining their infrastructure. Again, I'm also very grateful of bitcoin demonstrating we can exchange value without a 3rd party, but it looks like nowadays we could do better.

Now in regard of the destruction of ecological areas, mining gold etc... I simply agree with you.

Some people have looked into securing a blockchain currency with some other more useful computation. So far nothing much has come out of it, and there are some theoretical reasons why we shouldn't expect too much.

So there were attempts to make the calculations more useful, but that's not the only way to avoid this 'wasted energy'.

One alternative idea is 'proof of stake'.

And then it always seemed to me, also, that some kind of strategic partial centralisation could help make cryptocurrencies much more efficient..

No PoS system has emerged that can both remain perfectly distributed while also preventing double spend chain forks. If the cost to participate in multiple conflicting histories is effectively 0 (as it isn't with PoW, but is with PoS) then you can prioritize a history most beneficial to you instead of the reality.

Honestly, if you are going "big leagues" in cryptocurrency, I don't think having a central authority is bad as long as procedures are in place to contest flawed histories. Peercoin does its PoS through the developers signing key locking history - as long as people trust the devs, they trust the blockchain. If someone can prove the Peercoin blockchain is manipulated, the chain and project can be forked and someone else can be given confidence by whatever measure the community wants to use.

> Peercoin does its PoS through the developers signing key locking history - as long as people trust the devs, they trust the blockchain.

If trust in devs is sufficient, why bother with a blockchain? Just store the history in Git.

You might trust different people with different things.

> And then it always seemed to me, also, that some kind of strategic partial centralisation could help make cryptocurrencies much more efficient..

Yes, and you could implement that specialisation on top of bitcoin. Just imagine eg one of the bitcoin exchanges that hold your balance for you allowing you to send money to other account holders (even at other exchanges) without that ever hitting the blockchain.

The control to keep that kind of company honest is that people will occasionally demand their balances be paid out in bitcoin.

> That has nothing to do with the way banks are doing their maths or maintaining their infrastructure. Again, I'm also very grateful of bitcoin demonstrating we can exchange value without a 3rd party, but it looks like nowadays we could do better.

If you have a better idea, we're all ears.

computing prime numbers, searching new decimals of pi, folding proteins or whatever useful calculation there is to do out there.

I once suggested protein folding on bitcointalk.org. The thing is : it's easier said than done. Folding protein can not trivially be used to mark data as a cryptographic hash does, and you need this for the whole protocol to make sense. But if someone can come up with a proof of concept, we'd all be happy to look at it.

Not being able to easily quantify the inefficiency of one kind of waste is a very simple reason to not be mad about it.

And, of course, one can express a desire to want to fix one problem without being obligated to express the desire to fix problems many orders of magnitude larger ("You don't want our town to cut down the trees in the park? Why don't you care about the destruction of the rainforests?"). You don't even know that the person you're talking to doesn't want to fix those problems.

I feel your pain. In fact, the reason why bitcoin took cryptographers so long to come up with is the sheer inelegance of the scheme: normally you want the attacker to have to expend exponentially more resources to crack your security. Not just slightly more (ie 51% of the total).

The bitcoin design sat in a blind spot, perhaps deservedly though.

However, history has parallels: digging up gold out of the ground is enormously wasteful just to use it as a currency. Paper mostly does the job just as well. But just like bitcoin, the very expense can buy you certain security features. 'Gold' is the original proof of work?

History however also shows solutions: for commodity money, fractional reserve banking was one. For example, at its heyday the Scottish free banking system had a gold-reserve ratio of about 2% and was virtually crisis free. So the expense of digging up gold was all else being equal reduced by 98% compared to using gold directly for all trades.

Now, I wonder how widespread fractional reserve banking would work for bitcoin. At the moment, bitcoin exchanges holding your money in escrow come closest to the kind of institutions that could start this kind of banking for bitcoin.

I also don't know how fractional reserve banking would impact the price of bitcoin and the incentives for mining. As a bigger proportion of transactions would be off the bitcoin chain, eg mediated by trusted third-parties, mining incentives would perhaps go down?

Surely if we're involving trusted third parties and doing fractional reserve financial wizardry, we could just continue using a regular stable currency and payments network which doesn't involve expending enormous amounts of energy to ensure the monetary base is "trustless"

> which doesn't involve expending enormous amounts of energy

That is a fallacy. The traditional banking system uses much more electrical power to keep running than Bitcoin does.

It's also magnitudes larger than BTC...

Not per transaction it doesn't...

The point would be that the trust wouldn't be forced: people would be free to cash out into bitcoin at any time.

(Similar to historic free banking episodes in eg Scotland or Canada.)

1000+ Bitcoin companies have been created. You may disregard everything else, but this fact alone make Bitcoin not "wasteful". We get more than just transactions and SHA256 computations out of it, since already thousands of jobs were created at these companies.

http://blog.zorinaq.com/bitcoin-mining-is-not-wasteful/

So far no one has been able to come up with a useful PoW that leaves the properties of Bitcoin intact (notably decentralization, and trustlessness.) That is why it has to be based on abstract puzzles like hashing data. Some thoughts as to how implementing a useful PoW might be done: https://news.ycombinator.com/item?id=8963209

Also, Bitcoin miners use only a fraction of the electricity used by a thing that is literally useless on a technical level: Christmas decorative lights (6.63 TWh/yr in the US, probably 20+ TWh/yr in the world). This helps put things in perspective. If Xmas lights use 4x more electricity, you should be 4x more mad at Xmas lights.

I'm a little surprised I haven't seen more discussion about Gridcoin. I'd much rather use a digital currency if I knew it was contributing to curing cancer, mapping the shapes and orbits of asteroids, discovering new pulsars, understanding the genome, and so on.

https://gridcoin.us/Guides/whitelist.htm

This is part of the reason behind efforts like moving Ethereum to Proof of Stake instead of Proof of Work.

It makes me wonder if Gresham's law [1] will apply to cryptocurrencies. Bitcoin being slow to change and expensive to mine, may give way to other coins that are more adaptable and use less energy, such as Ethereum and Litecoin. Litecoin has already implemented Segwit, whereas Bitcoin seems paralysed by a debate that is hard to understand by an outsider.

These other cryptocurrencies are only less energy intensive because they are mined by less computer power. However Eth may introduce POS which will reduce computer power required.

[1] https://en.wikipedia.org/wiki/Gresham%27s_law

Would you still be upset about it if the Earth was using renewable energy sources for almost all of its electricity needs?

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