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Comment by arcticbull | Hacker News Reader

That's not what I am arguing as it's not what Nic is arguing.

Nic doesn't say that Bitcoin consumes less power than you think on a per-transaction basis. He says that Visa consumes way, way more if you price in nebulous externalities.

I am rejecting his thesis by saying that if Visa used as much power per transaction as Bitcoin we'd need to generate 3X as much power as we currently do.

The quote is: "Any energy comparison must take the above into account – including the externalities from the extraction of oil, which implicitly backs the dollar."

I'm taking it into account. And I'm saying he's wrong.

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> Nic doesn't say that Bitcoin consumes less power than you think on a per-transaction basis.

Sure he does:

> Second, metrics like the “per-transaction energy cost” are misleading because transactions themselves do not cost energy; nor does bitcoin’s CO2 footprint scale with transactional count.

The point is that transactions per second isn't the unit of value by which Bitcoin is priced. Bitcoin is not competing with other monetary systems simply on the basis of transactions per second, but also network trustworthiness/security

You stopped reading half way through my sentence. He’s not disputing Bitcoin energy usage he’s disputing visa. That’s what I wrote.

I did read it but I cut out the irrelevant part.

He's not disputing the per-transaction cost of Bitcoin OR Visa, and is explicitly pointing out how looking at it on a per-transaction basis is misleading.

He is disputing the overall total network costs, not considered on a per-transaction basis but in terms of the total value provided by the network to all its users.

Transactions per second is just one of the factors that could add value to a monetary system, but it isn't the only one.

I think you’re being intentionally disingenuous like Nic, but at least he was clear: “ Any energy comparison must take the above into account – including the externalities from the extraction of oil, which implicitly backs the dollar.”

I factored it in with my calculus and you and nic are wrong. If you believe otherwise please show your work like I did not gut feelings.

TPS is a means to an end re disproving the thesis not a talking point about utility.

I am not looking at value in terms of TPS. TPS an intermediate step in my calculation. I am looking at total system usage. Sorry bud, your system is the digital equivalent of rolling coal and no amount of mental gymnastics will change that.

But by all means show your work and let’s talk about it, don’t just say “nope try again” haha that’s what people who have no leg to stand on do.

Right, he is comparing the total usage of the network including externalities. But not on a per-transaction basis, since that would be meaningless, as the transactions per second can be scaled arbitrarily with almost no change in energy consumption.

The problem here is not about including the externalities (although that is an important thing to consider). The problem here is that it is a mistake to look at the value only in terms of transactions per second when transaction rate is just one factor by which you can judge a monetary system. It's not necessary for Bitcoin to compete with other monetary systems in terms of transaction rate for it to be useful.

Show your work!

Per-transaction basis is completely meaningless math. Both systems can be scaled as I said. The point is that it's more expensive to run the US dollar system than Bitcoin.

Well ok do you have any basis for that or is that speculation?

Per-transactions costs matter a lot, you can’t just hand wave that away if you’re hoping to actually persuade anyone.

As far as scaling Bitcoin goes: prove it. It’s been a decade and it still does 4tps.

https://www.binance.com/en/cards

Pointing to a Visa card to solve crypto scaling is probably not the argument I’d go for.

That's exactly how the Bitcoin's payment layer scales. Visa is just one solution, but that's probably the most popular one. The settlement layer doesn't have to scale, because it's possible to scale the payment layer. You get all the benefits of sound money with the usability of fiat money.

It scales by using the system that Bitcoin was supposed to replace?

Again, that’s not an argument for Bitcoin, just so we’re clear. This is an argument for visa instead.

Eh, that was an example that everyone can grasp. A more inline alternative would be Lightning Network.

No, Visa is a payment network that works with any currency. Bitcoin replaces the US dollar, not Visa.

>As far as scaling Bitcoin goes: prove it. It’s been a decade and it still does 4tps.

Sure. The Lightning Network already exists, is working and in use, and can in principle do essentially unlimited TPS.

Bitcoin doesn't need to scale to millions of TPS to be successful (since payments and microtransactions aren't its only use case), but it so happens that it can do that through second layer technologies.

Per-transaction is only meaningful if you believe Bitcoin's only utility is by competing with Visa for everyday transactions like buying a cup of coffee.

But if you find that Bitcoin is a digital, permissionless, borderless, uncensorable store of value, a better gold than gold, then it doesn't need millions of transactions per second.

Bitcoin is just fine as the most secure settlement layer and long-term store of value for large, infrequent and expensive transactions.

Fiat money isn't going anywhere, Visa doesn't need to be replaced, and Bitcoin doesn't need to pay for your coffee to be useful. It can do what it does best, coexisting with fiat systems and other cryptocurrencies.

> Bitcoin is just fine as the most secure settlement layer and long-term store of value for large, infrequent and expensive transactions.

It's not, because its inability to scale means folks are pushed onto L2 which has none of the guarantees you mention.

If I buy real estate or fine art to defend against the money printer, my transactions are large, infrequent, slow and expensive.

As Bitcoin's use as a store of value increases and transaction throughput remains constant, transactions will be larger, less frequent and more expensive.

I won't get pushed out onto L2 just like I'm not pushed to liquidate real estate or art collections. I don't transact in long-term stores of value more than once every few years, and then I expect the transaction will be large, slow and expensive.

These guarantees aren't needed for most daily transactions. Using Visa with Bitcoin is fine, and does not undermine the security of the currency.

Your absolute right, those guarantees are not needed in most circumstances, which is why bitcoin is irrelevant.

Users can choose to adopt the trade-offs of second layer solutions if and when it is convenient for them, and with whatever portion of their wealth that they like.

Almost like classical finance has worked forever. Remind me what we’re Expending this energy for again? Or are we closing in on the end of the speedrun?

For situations in which the risk profile of traditional fiat currencies doesn't meet your needs.

It is a strawman to say that Bitcoin can only be useful if it replaces all traditional financial instruments.

I've never said that. I've said it does literally nothing better than classical systems. That point remains in contention. The idea that it's somehow everything and nothing at the same time, just a perpetual number go up machine, is a pro-crypto argument.

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