Comment by doctorwho42 | Hacker News Reader

Comment by doctorwho42 | Hacker News Reader

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I'm in your boat, when it was first explained to me in a hacker space at college when it was first growing and priced at a few cents per 100++ Bitcoin. All I could see was a waste of energy and resources (time, energy, hardware).

It will always be a drain on society, and it scares me that it hasn't failed because we see it draining our GPU industry to the point that market prices have gone insane and availability is practically non-existent / all left up to chance.

It does take a rocket science to see the trends, as long as it's tied to needing hardware to compute arbitrary calculations to work... It's going to waste computer resources and energy. Both which are finite resources... Yes finite, solar cells aren't free to make, they don't last forever after you make them. Same with any other green technology. Maybe if fusion was our only power source it would be less of a concern, but we still haven't cracked Q=1, so... Yes it is a waste of finite resources.

It’s not draining the GPU industry. No one buys GPUs for mining Bitcoin anymore, they use ASICs.

In the specific context of Bitcoin it may be true that the preference is for ASIC, but (1) some Bitcoin is still mined using GPU's and (2) there are several thousand active digital currencies, many of them favoring GPU's.

Grandparent's wider assertion is absolutely true, the GPU market is skewed by miners. Purchasing a 3000 series GPU is not easy right now.

Do you have a source for (1)?

I'm pretty sure GPU mining btc is inefficient even with free electricity (depreciation of the PC/GPU will outweigh benefits)

edit: was curious so checked the math

Using a 3060TI GPU (one of the most cost-efficient for performance gpu's available) would generate about $0.0002/day, or take ~5000 years to pay itself off even with free electricity

Doesn't bitcoin compute time go up with computational advances also? If so, any answer greater than a few years can be transposed to infinite time to cover costs.

I'm not sure about that...Search "best GPU mining 2021" on Google and you'll get several hits.

None of those seem to be about Bitcoin? For example https://www.nicehash.com/blog/post/best-mining-gpu-in-2021 lists a "DaggerHashimoto" hashrate which would be for Etherium.

Most people mining use something like NiceHash, which rents out your hashpower to people who use it to mine the currently most efficient asset (usually ethereum/monero/doge+ltc)

Mining bitcoin with a GPU would take around 5000 years in the best case scenario to pay off _with free electricity_

Even as just ASICs there's something of a drain, Bitcoin ASICs consume fab production which means less remaining production capacity for GPUs.

This is an equilibrium that should eventually fix itself, but while Bitcoin and crypto mining is growing they are making a material dent in the global semiconductor economy.

Cryptoasset mining creates demand for custom chip fab (how different are mining rigs from SSL/TLS accelerator expansion cards), which is definitely not zero sum: more revenue = more opportunities.

https://en.wikipedia.org/wiki/Price_elasticity_of_supply

With insufficient demand, a market does not develop into a sustainable market. "Rule of three (economics)" says that markets are stable with 3 major competitors and many smaller competitors; nonlinearity and game theory.

https://en.wikipedia.org/wiki/Rule_of_three_(economics)

We've always had custom chip fab, but the prices used to be much higher. Proof of Work (and Proof of Research) incentivize microchip and software energy efficiency; whereas we had observed and been most concerned with doublings in transistor density.

FWIU, it's now more sustainable and profitable to mine rare earth elements from recycled electronics than actually digging real value out of the earth?

Compared to creating real value by digging for gold, how do we value financial services?

They're mining it with malware on CPUs, don't underestimate human stupidity when faced with large numbers of people...

They may be mining Montero but they definitely are not mining bitcoin

In the end GPUs are better off using energy to play counterstrike than to generate sound money right?!

You're looking at it from a totally wrong perspective. The U.S. government can print as much dollars as they want, whereas BTC cannot. The government does not care about green energy unless they can profit from it. To say that you did not buy BTC because of "wasting energy" is a very odd way to cope.

You guys are so hung up on energy consumption, a meme, that you're forgetting the real intrinsic value of Bitcoin.

> the real intrinsic value of Bitcoin

Intrinsic: belonging to the essential nature or constitution of a thing [0].

Bitcoin, being a series of bits proving you or one of your financial forebears burnt some spare energy without any material return, has no intrinsic value. Its value is entirely extrinsic and intersubjective, in that it only has value if a quorum believes it has value.

[0] https://www.merriam-webster.com/dictionary/intrinsic

> The U.S. government can print as much dollars as they want, whereas BTC cannot.

In a macroeconomic sense, this is a strength of the dollar and a weakness of Bitcoin.

It is a strength of the dollar as a fiat currency, but that doesn't mean it would be a good thing for every asset class to behave that way.

Haha wait wait, so energy consumption is "a meme," but having a fixed supply of money is apparently a totally good idea and not at all a meme. We don't care about deflation, we don't care about monetary policy, we want a gold standard where instead of gold we just burn absurd quantities of carbon. lol

I understand the value of blockchain tech, but what's the intrinsic value of Bitcoin?

Value which cannot be stolen or debased.

Also, "blockchain" is just a data structure that has practically no use besides bitcoin.

> Value which cannot be stolen or debased.

Bitcoin's "intrinsic value" is really value unto itself for the most part, at this point in time. Maybe in the future it'll be used more as a currency, and we've seen that with Tesla, Bovada, etc., but I don't think most governments will allow such a threat to their currency without additional controls.

> Also, "blockchain" is just a data structure that has practically no use besides bitcoin.

I've always felt the other way around actually; I think blockchain will be used more widely and longer-term than Bitcoin. Blockchain as a technology has already been invested in and deployed by firms like IBM and JPMorgan.

Centralised blockchains are an oxymoron. Just use JPMorgans SQL database, it’s cheaper.

Sometimes you want to trust and verify.

Seems like there have been numerous stories about bitcoin being stolen?

Private keys can be stolen if you leave them lying around.

Nobody can steal your bitcoin if your private keys are well protected. And of course, the best protection is a brain wallet.

If a State attempts to implement an EO6102 equivalent for Bitcoin, they will be unable to enforce it.

Brain wallets are hilariously bad, if you make it up yourself; a randomly generated key is far superior and can still be memorized. Search up "brainflayer" for just one example of a brain wallet cracker.

> Nobody can steal your bitcoin if your private keys are well protected. And of course, the best protection is a brain wallet.

The end result of this is that a huge portion of humans cannot safely store their wealth in btc. I sure as hell don't trust myself to keep that much cash in a brain wallet.

"If your private keys are well protected" might as well mean "if you can do four backflips in a row" to most people.

The best strategy is to use a BIP-39 seed phrase with an additional passphrase. The seed phrase should be written down/etched into a piece of metal and stored safely (with redundancy), and the passphrase should be memorized by yourself and possibly a family member (as insurance if something happens to you).

You can leave a small amount of coins in the wallet using the same seed phrase but with no passphrase as a decoy. This way, if somebody "stumbles upon" your seed phrase, they'll attempt to recover this small amount of money, and you can monitor using only the xpub to discover it has been compromised. You then have some time to move the other coins before anybody could potentially brute-force your passphrase (Since they need to compute PBKDF2 for each attempt).

You can reuse the same seed phrase for multiple wallets, using a different passphrase for each. There is no way for somebody to determine if you have surrendered all passphrases for a give seed, since there could be infinitely many. This offers plausible deniability in the case your thief is the government.

Listen to yourself. Decoys? What percentage of people do you think won't go running away screaming when you tell them that this is how they should store their wealth? If I lose my bank password I can walk into a branch and talk to a human. No need for metal etchings and incantations.

Yeah, not everyone needs custody of their own money.

But those of us who do, can.

Under fiat, we can't.

And that'd be fine if btc was a niche product for a few people who want this control but it also comes with extreme social costs in terms of emissions. The power use argument that advocates make is that it'll be fine once btc is used by literally everybody.

Cannot be debased? When the US government rules it illegal, or enough people collectively lose interest, btc will no longer have value.

> When the US government rules it illegal, or enough people collectively lose interest, btc will no longer have value.

Recall that for the first 2 years of its life, bitcoin had no market price. Bitcoin acquired a price because it has value to some people. That is, its having value preceded it having a price. What that should tell you is that even if a lot of people lost interest, bitcoin would still be valuable. The key insight arrives if you figure out what is valuable about Bitcoin that caused btc to acquire a price.

" It might make sense just to get some in case it catches on. If enough people think the same way, that becomes a self fulfilling prophecy. " https://satoshi.nakamotoinstitute.org/emails/cryptography/17...

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