Don't mine Bitcoin, mine Altcoins

The second question is based on faulty assumptions. Bitcoin uses orders of magnitude more energy per transaction.

Bitcoin can never and will never be a fraction of the efficiency of the modern world banking system, and it can never and will never be able to handle the number of transactions. While you could argue that updates and changes over the years might be able to mould Bitcoin into an efficient transaction network, at that point it would not be Bitcoin anymore.

VISA is capable of handling 56,000 transactions per second [1] while Bitcoin is capable of handing a measly 2.5 [2]. Bitcoin would need to scale by 224,000% to match VISA, and VISA is one of my different global networks. I don't know how much energy VISA uses but as of today, the bitcoin network is estimated to be using 16TWh [3], that's the same as all of Jordan or Lebanon or 5.2% of the energy consumption of the United Kingdom [4].

Assuming no energy consumption improvements, to scale to VISA levels Bitcoin would need to consume 224,000% more energy. That's 35,840TWh, which is nearly twice as much energy as the entire planet uses (21,776TWh)!!!

So, if Bitcoin is able to become 90% more efficient, it would only require as much energy as nearly two European Unions. If Bitcoin is able to become 99% more efficient, it would only require as much energy more energy than the entire United Kingdom. If Bitcoin is able to become 99.9% more efficient, it would only require as much energy as Qatar. I can keep going but I won't. I might have made a mistake and been a factor out, but even then it doesn't even matter, that's how ridiculous the numbers are.

I don't know about you but I find it rather unlikely that Bitcoin will every be a viable replacement for the world banking system. Maybe in a universe where Nuclear fusion is easy and ASICs never wear out, and the cost of cooling them is free but unfortunately for Bitcoin we don't live in that universe.

Bitcoin and crypocurrancys are horrible inventions if you care about the planet, if you think a massive decentralised network where value is created from ever increasing difficulty proof of work could be more efficient than VISA you are frankly deluded. Granted, this is someone who does not own any Bitcoins, so maybe I just haven't drunk the kool aid.

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1. https://usa.visa.com/dam/VCOM/download/corporate/media/visa-...

2. https://blockchain.info/charts/transactions-per-second

3. https://digiconomist.net/bitcoin-energy-consumption

4. https://en.wikipedia.org/wiki/List_of_countries_by_electrici...

So your argument is because it's not the "top of globally wasted resources", we should ignore the waste? It's a large enough industry that GPU stock and prices are hugely affected by it, and its much more conventionally wasteful than the services you're trying to compare it to. Plus if the goal of cryptocurrency is to become more mainstream, this is a super important argument to make against it in its current form.

I could be completely wrong (I don't fully immerse myself in cryptocurrency) but isn't mining coins way more heavily intensive on a CPU and overall power consumption than simply passively storing a lot of personal data?

I remember a couple of friends wanting to buy some powerful machines to mine bitcoins a few years ago, and they had to actually calculate their electricity bill to make sure they weren't losing money. That's quite a ways from storing Instagram pics.

Why isn't the current argument valuable unto it self? We don't need to equate it to anything in order to measure it's worth (or lack there of). It's a valid statement that can be discussed. If you want to do the same for other data, go for it, but in another conversation.

Yes, pretty much everything in our current economy is extremely inefficient. In terms of waste, cryptocurrencies are peanuts.

- Facebook ad spending is a waste; do companies actually get a ROI on all the money they give to Facebook? They don't actually know! In the grand scheme of things it's a complete waste. If Facebook didn't exist, then companies wouldn't be forced to pay it money just to stay relevant; they could focus their funds on actually improving their products instead. Not to mention the enormous amount of otherwise productive human hours that Facebook is responsible for wasting every day. That's not even counting all the other social networks.

- Gambling; $240 billion per year; the money does nothing for society. The amount of money spent on gambling every year is MORE than the total market capitalization of all cryptocurrencies added up together. So even if you think that buying a cryptocurrency is gambling, your odds are much better (and improve as you do more research). If people stopped gambling on horses and lottery and started gambling with cryptocurrencies instead, the total market cap for cryptocurrencies would be much higher than it is now.

- Sports; the sport industry makes $75 billion per year. Yes it's entertainment. So is trading cryptocurrencies.

- Tobacco industry makes $35 billion in PROFITS per year. Doesn't add anything positive to society. I think that if you were to add up all fees (profits) ever charged for transferring cryptocurrencies, you wouldn't get anything close to $35 billion.

The energy spent to facilitate these services are incidental to the work being performed; the total energy spent is a function of the task being accomplished. "Proof of work", on the other hand, is wasteful by design, which is obvious when you consider that "the work" itself is not useful, all that's useful is the assumption that the cost of wasting energy is too great to be worth it for a malicious actor. That isn't to say that POW cryptocurrencies themselves are useless, but they are certainly wasteful. An aversion to waste is literally the security mechanism.

repeating double sha256 would be a rather inefficient way of going about this

Putting on the tinfoil: cryptocurrecies are a defacto bounty for hash algorithms, bitcoin is excellent proof that sha2 and ripemd160 arent broken

Those exist

There are a few of those. I think the first and most established is Ripple.

Plenty of people talk about, issue is people are so locked into their profit motives that they reject dissenting statements like a hot poker to the skin.

Except those are all good things, more demand in this space will drive more competition and force manufacturers to push the energy saving capabilities of chips further in order to stay competitive. Raw materials can be recycled, we're not dealing with finite resources here.

Then again it could all just be a bubble, in which case yes there will be a lot of waste but the market will correct itself. The problem is cryptocurrency has real value, it takes real computing power to process and once it's processed it's very secure (therein lies the value) so I don't think cryptocurrency is going away

Last time I looked at the like profit "mining" ETH (a couple of people at work go on about it endlessly so I thought I'd check the maths) with my current hardware (a pretty decent single GPU and a couple of reasonable CPUs) and the price I pay for electricity I could net about $100 in a few months. That just isn't worth the potential hassle (setup, monitoring, keeping mining clients up-to-date, leaving the main desktop machine on full blast 24/7 heating up the room in summer for a start, and the profit calculation didn't include anything regarding extra wear-and-tear) to me.

> It seems like a completely ignored aspect of cryptocurrency.

I don't think it's ignored at all. It's covered in Bitcoin's FAQ because it comes up pretty often. Also some folks have tried to create coins that use something other than a PoW. Some have created coins whose PoW has independent utility (XPM: cunningham chains of primes).

> raw materials that go into all these GPUs

Well, thank goodness the GPUs have independent utility. If you want to be concerned about waste, the ASICs are generally much less useful after difficulty increases than GPUs.

> seriously perverse.

shrug people every day "waste" global resources on things that I think are totally worthless. You might see bitcoin and friends as similarly worthless but if absolutely nothing else it does seem like it has real utility for making remittances more affordable.

You can talk about it all you want. I don't think anyone has begun to come up with a realistic solution. You can't make it against the law to mine, so what else is there?

That's not self-regulating; environmental harms of increased electricity usage and elements usage in hardware is an externality that isn't always captured by the market.

Or conversely big players will pony up for larger operations to exploit marginal inefficiencies and other economies of scale, which is what seems to be happening.

Additionally you're assuming the only motive behind mining bitcoin is the value of bitcoin, effectively ignoring realities like, e.g., that entities use it to avoid capital flight regulations.

You're partially right. But "wasted" compute cycles refers to time that your CPU sits idle. I think the argument here is about energy usage. So sitting idle is not the same as running other people's computations.

That question is as impossible to answer as "if I started an apple orchard how profitable would that be".

NiceHash

can you provide any examples? i'm very skeptical because generally any coins that are viable with GPU mining are very quickly made not so by an influx of miners...

Thanks - here in the UK Monzo (a startup but more or less a traditional bank) is filling that niche, and I'd not hear of Aeon. I think a mobile privacy platform like that has a lot of potential but you'd need to make it very easy to buy the coins too.

The problem with these exchanges is you can never be sure what your actual return is going to be (this is true to an extent for all coins, but the effect is not as big for the more established coins that you mine directly).

Suppose there's altcoin called ALT which can be mined very quickly and is worth let's say $0.00001 per coin. Mining a block takes 5 minutes and the payout is 10000 ALT coins or whatever. The 10000 coins are distributed across the pool, and you determine that on your setup you should be able to mine $3 USD in terms of BTC a day on the pool. You get wind that ALT is about to get pumped hard, which means your potential earnings could reach $20 per day (or whatever).

What's the problem (ignoring exchange fees) with going "all in"?

Firstly, ALT coin may have a confirmation time of several hours or even days. You can't sell unconfirmed coins.

Secondly, the exchange has to sell these coins elsewhere (usually another exchange). Because of the low value, this other exchange may have a rule that you can only sell in batches of 1 million. So even though you've mined X amount of coins, you still have to wait for the batch to be fulfilled.

Thirdly once the batch is fulfilled, you still have to wait for it to be sold on the other exchange.

And finally, the BTC <-> ALT exchange rate may fluctuate independently of known factors.

By the time this happens, your ALT coin will almost certainly be worth a different value to what they were when you first mined them.

It could be worth more or less, but the point is you can't efficiently forecast on most alt-coins when you use exchanges like Zpool and NiceHash. This is why they usually have several values for your "earnings" - Total, Unconfirmed, Confirmed, and Sold. It's also why "profit switching" algorithms and techniques are kind of a silly idea for most alt-coins - you cannot calculate profit based on current market values.

Shapeshift still requires a buyer on the other end, though I'm not entirely in agreement with the op. Seems like most relevant coins have some real volume

I'm 100% ok with political threads being censored here. I'd immediately stop bothering with this site if that toxin got unleashed here.

Money kept in the bank is guaranteed by your government to retain (some) value; it is backed by the economy of your country. Bitcoin is not backed by anything other than speculation on implied value