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Comment by primitivesuave | Hacker News Reader

I see Bitcoin like a 21st century Apollo project. While I agree the resources appear wasted, they are supporting a revolutionary concept that holds tremendous potential to change the way the world works. Also, consider the scale of resources used by the existing financial system, with its thousands of buildings staffed by millions of people who use energy to come into work every day to keep the whole centralized system running.

I see this call to destroy it as akin to the 1969 Apollo mission protests, when civil rights leaders argued that the space mission resources would be better used on Earth.

https://www.history.com/news/apollo-11-moon-landing-launch-p...

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I think this is a very bad comparison, for several reasons.

1. With the Apollo missions, the money being put into the project was going into research and development, so there was at least some expectation of getting new science and technology out of it. With Bitcoin,nthe money put in is going into speculation or mining, which only fuels the network. There is no reason to expect new technologies to come out of this, and certainly not any new science.

2. The Apollo project was a big consumer of money, of which there exist plenty in the world and we can create more. Bitcoin is a huge consumer of electricity, the production of which is generally accelerating global warming, the single biggest threat to our survival as a civilized society that has ever existed in history.

We already know that Bitcoin itself is not even remotely close to being a solution to the problem you're thinking about (decentralized money), even IF I agreed that this is a real problem (I don't, I believe Bitcoin is going in the wrong direction compared to fiat money). You could make a decent argument for investing in developing scalable crypto coins, maybe Ethereum or maybe something else, but proof-of-work crypocoins and Bitcoin in particular are an obvious dead end, and can be decommissioned entirely without much loss (especially if the bitcoin holders were compensated somehow).

> There is no reason to expect new technologies to come out of this, and certainly not any new science

Proof-of-stake coins are one obvious counterexample. Would proof-of-stake technologies have been developed if proof-of-work didn't come along first to incentivise development and build trust in cryptocurrencies?

Proof-of-stake is not an iteration on proof-of-work, it is a lateral idea. There is no reason why the first popular crypto-coin wouldn't have been proof-of-stake, except that it didn't occur to Satoshi (or it did and they didn't like it for other reasons).

Firstly that's not completely true: proof-of-stake doesn't solve the initial wealth distribution problem so often proof-of-work is still necessary in some capacity even in proof-of-stake coins.

Furthermore it's possible that a purely proof-of-stake currency would have never gained the widespread trust that proof-of-work did at a time when cryptocurrencies were a new idea. Or maybe not... but people did have ideas about proof-of-stake quite early on and it took much longer for those ideas to gain the same level of acceptance that proof-of-work did.

Inventing the technology and getting it adopted are two different things.

For example, I happen to believe that decentralized coins are a horrible idea in and of themselves, even without proof-of-work also helping to increase global warming. So, from my point of view, any adoption of a crypto-currency is a net-negative, and I would be happy to know that the technology exists, but is staying abandoned as long as we have no use for it other than non-centralized money.

> I happen to believe that decentralized coins are a horrible idea in and of themselves, even without proof-of-work

Sure, but that is a much different argument than proof-of-stake vs proof-of-work.

With the assumption that having a successful proof-of-stake cryptocurrency is a net good, then what I am saying is maybe our usages of proof-of-work up until the future widespread adoption of proof-of-stake actually will contribute more positively to that end than negatively.

My original claim is that new technology is not getting funded by dumping energy into bitcoin mining. Proof-of-stake was proposed as a counter example, but as discussed it may actually predate bitcoin's adoption. It may be true that dumping energy into bitcoin can fund the adoption of a proof-of-stake coin, but that is no longer a new technology, it is simply adoption.

So I stand by my original point - the resources going into bitcoin are not fueling technology research.

They may be fueling PoS Ethereum adoption, but that is another argument entirely.

> It may be true that dumping energy into bitcoin can fund the adoption of a proof-of-stake coin, but that is no longer a new technology, it is simply adoption.

I'm not sure that's true. Proof-of-stake is established as a concept but there is still lots of room for technological improvements in the implementation and user experience. New proof-of-stake coins can compete more effectively because of the trust which Bitcoin established.

You are speaking in absolute terms. It goes against all logic that new technology wouldn't be funded by dumping energy into bitcoin mining.

Simple logic.. Billions of dollars in miners are bought by speculators, Bitmain orders new 5nm chips from TSMC... TSMC uses money for R&D.

Either you're being willfully ignorant or you're trolling us.

1. Bitcoin mining is a race to cheap power, it's of course going to lead to more efficient power delivery technologies. Excess energy being created by hydrodams is being sold to fund infrastructure and to subsidize energy costs during dry seasons. Oil companies are capturing energy once wasted: https://news.bitcoin.com/bitcoin-helps-oil-companies-reduce-...

Bitcoin is an energy currency.

> Bitcoin is an energy currency.

Not a currency, but a digital asset that wastes enormous amounts of energy.

Last year it transacted more than a trillion dollars in transactions.

It's in the top 20 or so of world currencies, and it's still in its infancy (thus volatility etc).

Sardines were also involved in transactions amounting trillions of dollars, but that doesn't mean sardines are a currency.

"It's in the top 20 or so of world currencies, and it's still in its infancy (thus volatility etc)."

My question, then, is how do we go about drowning Baby Bitcoin in the metaphorical bathtub?

Wastes enormous amounts of energy... The energy is literally being stored in the value of bitcoin. It's an energy credit. People are transforming excess electricity into bitcoin. Period.

What do I do with my profits from mining bitcoin? Send my kids to college, buy groceries, remodel my bathroom, etc. It's an entire ecosystem, speculatively mining bitcoin by consuming electricity is just as evil as driving 1.5hrs to work because you're too lazy to find something near your house for example. People expend trillions of dollars in energy "mining" fiat.

In a very real physical sense, the energy is not stored, it is getting converted to waste heat.

Sure, the monetary value of that energy may be getting stored, but we can't buy lower temperatures with money, unfortunately.

When you store energy by pumping water for example, you can later let that water flow to get back the energy itself (with some inevitable waste, of course). When you're converting energy to bitcoin and later require energy again, you have to use the bitcoin to buy more energy (either from the market or by building a new power plant or something), you can't just physically convert the bitcoin back to energy.

There are already plenty of incentives for improving energy generation, reducing waste, and getting better at efficient delivery: people are willing to spend money for electricity for useful purposes other than speculation.

If anything, bitcoin mining is a disincentive in making a more energy efficient green economy: instead of reducing waste and reducing power production as needed, we now have a way to turn excess power production into money directly. While a carbon tax could have shut down a coal plant, now the coal plant could instead get a bitcoin mining rig and power that, as long as the carbon tax is lower than the (extremely volatile) value of bitcoin.

To avoid the most apocalyptic effects of global warming, we have to close down most fossil-fuel based energy generation today, literally. Bitcoin is actively working against that by driving up the price of electricity to fuel a speculative bubble.

You make a very compelling argument, especially #1 that there can't be an expectation of any new technology or science to come out of money spent on speculation or mining. Equivalently, any progress in blockchain technology doesn't require the existence of the Bitcoin network to be implemented.

I now see some holes in my Apollo analogy (also government vs individual spending). I am lucky there is always someone on HN who will make a better point :)

I actually think there is an expectation that increased trust/acceptance in Bitcoin will help the success of future improved cryptocurrency technologies.

Bitcoin gives users a trustworthy decentralized store of value today that they could easily move to another cryptocurrency in future using some kind of decentralized exchange based on smart contracts. It provides liquidity for all future cryptocurrencies.

That is a different argument than the comparison with the Apollo mission, and entirely relies on believing that the end-goal itself, a crypto-currency based financial system, is a net good in itself.

The Apollo argument was more compelling because it didn't require any value-judgement of the end-goal (but it was less appealing to me for the reasons I outlined). It is an argument about the process, regardless of the results (in the end, the lunar landings in themselves were a symbolic victory more than any great advancement of science - the science happened on the way).

We can go into arguments on why I think the end-goal of crypto-currency believers a la Satoshi would be a net negative, but others have covered it pretty well (deflation, fraud, money laundering, having your life savings destroyed by a hack etc).

To a point, but that trust by the public can be easily swayed and destroyed - see Biden pick Janet Yellen and her recent comments about how BTC is used for and good for nothing but criminal activity including that by state sponsors of terrorism.

For #1, there is no actual evidence to counter that, but, the logic doesn't stand either, just, why not?

https://twitter.com/id_aa_carmack/status/1348094702550216707

> change the way the world works

Change how exactly? To me bitcoin seems like this:

Expectation: the world ditches banks, dollars, euros, etc. People switch to bitcoin and everyone lives happily, paying for everyday stuff with bitcoin.

Reality: people do not use bitcoin to buy groceries. In fact, people do not use bitcoin per se - people are only interested in buying and holding (speculating).

The idea that Bitcoin can only be useful if it completely replaces all existing financial instruments is a strawman

People actually use Bitcoin - to transfer money across the world where other options are unavailable or too expensive. It's very popular in Africa.

> It's very popular in Africa.

Source? Africa has mPesa which is vastly superior than BTC

Remittances by traditional methods fell by 97% in Nigeria. Central bank had to ban Bitcoin.

Look it up. It's real.

Its also popular as a means to withdraw resources from dictatorships, basically improving private property protections at the expense of state ability to control their population.

You mean "withdraw resources by dictatorships", not "from" dictatorships.

As a dictator, my goal is to fill my bank accounts for when I get deposed. In most cases, countries who have their resources fleeced have lawful means to go after former dictators. Bitcoin removes that.

How exactly someone can "withdraw resources from a dictatorship" using bitcoin?

I don't think any technology will ever be adopted in a drastic switch, but I can definitely see it happening gradually. Consider some future cloud hosting provider that accepts payment in cryptocurrency (not necessarily Bitcoin) - someone building a SaaS product could charge customers in that currency, and take advantage of financial instruments that are much more difficult to implement with traditional banking (micropayments, smart contracts, etc).

Bitcoin is not going to be able to scale to the world's population. A more accurate expectation at least for the US is that the financial system is rebuilt on web3. Every day people will be holding stable coins pegged to the USD in their bank accounts. The average Joe will not be able to tell the difference. He can still deposit dollars into his bank account and cash checks. He can still withdraw USD, or use a debit card / credit card to buy things.

We are still in the very early days of decentralized finance.

It's not revolutionary. For almost every use case, blockchain solution are almost always inferior to the alternatives. As a payment system, it's sluggish, wasteful, and in 2021 STILL poorly adopted.

I'm not arguing anything about the current system of doing financial transactions. But the environmental disaster that is BTC has to die.

If there is truly a need for innovation in the digital currency space, it should be replaced with something less wasteful. Too bad all the pundits and hodlers are too invested to admit this.

If BTC mining and related operations were halted right now as you wish, by what percentage would the CO2 production decrease? By 0.1%, inconsequential.

We need to focus on decomissioning coal/gas power plants and combustion motors for transport. That will get us at least 60%.

> We need to focus on decomissioning coal/gas power plants and combustion motors for transport.

Bitcoin is actively working against that. By increasing the energy demand from the network, it makes it harder to simply stop producing energy. It doesn't matter if miners are directly buying only from renewable sources (as some claim), they are still likely out-bidding someone else, who then has to go to a fossil fuel plant for their electricity.

The energy consumption of BTC is minuscule when compared to total electric consumption and its physical/economic effect on power networks is similarly minuscule. Yes, it consumes and contributes to CO2. So do other electric energy consumers, like big companies like Amazon, Google. So do, orders of magnitude more than BTC, consumers of fossil fuels. BTC is just an easy inconsequential scapegoat.

BTC consumes more electricity than many individual countries in the world. It is something like 0.1% of the electrical energy consumption of the entire world. That is not insignificant, it is a huge chunk that could be stopped with virtually 0 impact on the world economy (unlike all your other examples).

0.1% percent is pretty insignificant, it is 1/1000 of the world electric energy production, and that contributes only around 30% to total world C02 production.

Blaming and cancelling insignificant activities leads nowhere. And it's absurd, considering the main CO2 contributors are elsewhere - it is the transport and power plants which need this attention.

If we are talking about affecting CO2 production via electric energy policies, more just way (and more effective way) to introduce "CO2 sanctions" on various activities is to factor the damage in the energy price. That way everybody feels the pain proportionally, not just few random scapegoats like BTC. I agree that price does not need to be the same for everyone. Maybe BTC activities should pay much more for electric energy than a normal (non-BTC oriented) household does.

Last part: sure, agreed.

First part: bullshit. Shutting down BTC would be highly consequential.

BTC is the perfect peak shaver to have on your grid. This is what makes it so perverse. With a mining rig, you can shave excess production peaks on any of the energy markets: long-term, cover intraday swings, or frequency stabilization where you have to react in seconds.

If BTC ceases siphoning green energy away from hydro plants, etc, the grid operators and their governments will be forced to look into storing surplus production instead of turning it into waste heat and crypto hashes.

Yes big players can buy electric energy cheaper than the small guy (or even be paid to consume). Impact on consumer prices or CO2 production is very small and the blame in CO2 production is shared with the producer. So if there is a problem here it is with big player consumers and big producers increasing total CO2 production. I agree that on a global scale, that is a problem. However, it's not a problem inherent to BTC. If you think you can get rid of big players building dirty plants and producing lots of CO2 by cancelling BTC then you are naive.

Storage of energy was and is very small / non-existent because of large investments needed to build it, and little profit to be gained. It's not BTC's fault.

Bitcoin already went to the moon and back.

We learned about blockchain, we learned cryptocurrencies are possible. Now it's continuing to burn tons of rocket fuel for no further benefit... Saturn V served it's purpose, there is a good reason we don't continue building rockets this way. We learned a lot from Bitcoin, critically, we learned it is _not_ the solution to a sustainable decentralized digital currency.

Not convinced this is a good analogy.

If we could have gone to the moon at a fraction of the cost, but people had still insisted on doing it the expensive way, just because the expensive approach came first, that would be a better analogy.

If we're going to follow this analogy, what are the beneficial side effects from bitcoin?

Better ASICs that do nothing but calculate sha256 hashes? Easier money-laundering? New venues for tax evasion?

I guess censorship-resistant online value transfer is worth something, but I'm not sure it outweighs all the negatives.

Some people think the internet should be beyond the control of a single government, and perhaps by extension so too should the financial system. There are a lot of caveats to this idea.

Even for those that do, a network capable of handling maybe a few million transactions per day while consuming more energy than many small countries is so obviously useless in that regard that it should be abandoned entirely.

I don't disagree with the weaknesses you point out, but I do think "abandon entirely" is an extreme stance. It's completely possible for bitcoin to lose while some other crypto (or basket of crypto coins) wins.

It's important to remember that Bitcoin (and other proof-of-work coins) have a very real and direct environmental cost. Given the state of global warming and how urgent it is to stop it, I believe that letting miners continue to waste energy is a much more extreme stance than stopping them today (with some kind of compensation program for their and others' investments in bitcoin, of course you can't just delete a trillion dollars worth of people's money in a minute).

Forcing budget reform because the government wouldn't be able to rely on printing money.

.. but should instead increase austerity, cut social programs, and raise taxes?

Besides, the seignorage revenue is pretty tiny in western economies..

You would still need a lending infrastructure outside of bitcoin to handle the economy, and then it would be trivial to return to fractional reserve banking with bitcoin instead of dollars. As long as people don't all call in their debts at the same time, which would be catastrophic either way, the system would work with bitcoin just like it works today (if bitcoin weren't so ridiculously slow and expensive to register a transaction, that is) .

Power over other people is intoxicating. It attracts those who value it over virtue, and the virtuous reject it.

For their wicked thirst for power, some will do anything. In our age there is an unholy alliance between the worlds greatest power ever and its military industrial complex, where the incentives for government leaders is to wage war in strange faraway lands, and to bribe the population at home with dependence on the state, in exchange for votes. This is all funded by printing money - inflating its supply. In effect, this is devaluing the salaries and savings of anyone who earns their living, and who can not do anything about it, as they are forced to trade in this currency created by fiat.

By creating Bitcoin, Satoshi took gold to the internet, and we can now trade in a currency which no one can inflate to fund wars, or to in essence steal productivity from every earner.

A sound system of ethics must contain the right to ownership of your property - you body, your money, and other possessions. Bitcoin practically gives us this in the Information Age.

> This is all funded by printing money - inflating its supply.

> By creating Bitcoin, Satoshi took gold to the internet, and we can now trade in a currency which no one can inflate to fund wars, or to in essence steal productivity from every earner.

Utter bullshit. The power of the US government doesn't stem from its ability to print money. Rather, it's the other way around essentially: its ability to print money stems from its power. The US government controls the most successful economy and army in the world's history, by far.

If it had a reason to, the US government could, with resources it entirely owns, out-mine the entire bitcoin network and print its own bitcoin as well, in violation of the protocol. What's more, assuming it were done publicly and with a commitment to maintain it, people all over the world would use the newly printed US-bitcoin.

More realistically, it could easily lend bitcoin that don't exist yet and create a fractional-reserve system right on top of bitcoin.

The problems of today's economy stem much more from "free market" systems like the officially-sanctioned speculation happening every second on Wall Street. Workers are hurt much more by so-called "free trade" agreements that allow US companies to own other parts of the world and exploit those for cheap labor at the cost of both US workers and the foreign economy. And wars get started not because the US has money, but because the US doesn't allow enough democratic control of its workings.

> Utter bullshit.

HN is such a rare place on the internet. I am writing in good faith - let’s not fall so low as to speak like this.

The power over currency and the power over arms go hand in hand.

The “officially sanctioned” exploitation you speak of - who is the “official” in question? The sins you and I refer to stem from the monopolistic use of violent force by the state. “Wall steeet” is far from a free market, and so if the dollar, euro, pound, and other state currency markets

From the ASIC perspective, what I see personally is a massive waste of engineering talent. Why build ASICs for boring but important tasks (especially bioinformatics) when you can cash in on Bitcoin mining while the going is good.

With regards to tax evasion, my opinion is that it will simply force taxation to occur in other ways like VAT. People are quite capable of evading taxes in the present system, so wide adoption of online value transfer would simply democratize access to tax evasion (and force governments to rethink how they collect taxes).

Money laundering makes me think of the dangerous flip side, where anyone can covertly accumulate and use resources without scrutiny - e.g. Ali Alexander using Bitcoin to finance the transport and lodging of groups that took part in the January 6th riot.

The Nazi and Stalinist regimes also stood to change the world too, you know. That didn't make them like the Apollo project. To be clear, I'm not trying to liken Bitcoin to either of those, just to point out that there's a spectrum from good to bad. I'm glad Apollo succeeded, but I'm also glad fascism didn't succeed. French Revolution changed the world too, in the short term, for the worse, but probably had a net positive in the long run.

Bitcoin? I'm not so sure. Bitcoin definitely stands to change the world, but I'm not sure for the better. Bitcoin would:

* By design, have exploding deflation

* Allow insane inter-generational wealth accumulation and disparity

* Block most of the controls used by central banks to stabilize the economy

* Allow a disk failure or hacker to wipe out someone's life savings

... and so on.

I'd actually liken it to the /early/ fascist, communist, and democratic regimes, which had a lot of good ideas for how to replace monarchies, a lot of bad ideas, and perhaps a 25% hit rate. The US worked out fairly well, at least once it got past the Articles of Confederation bit. France didn't work for a long time, but eventually worked out okay. Fascism and Soviet Communism /appeared/ to work better than what came before for a few years, and then imploded into horrors. The jury is still out on where the Chinese form of government lands.

At this point, we don't quite know which track we're on with Bitcoin. I was optimistic at the beginning, and now I'm more pessimistic, but it's too early to tell. In either case, we've learned a lot, and we could probably design a better system without many of Bitcoin's flaws.

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