Bitcoin and other PoW coins are an ESG nightmare
ofnumbers.com
ofnumbers.com
Without making any judgement on if this ratio is reasonable: this is 3-5x more than BTC POW but arguably also contains other negative externalities like loss of life, etc.
[1] https://earther.gizmodo.com/groundbreaking-report-gives-us-a...
That's something like 5 orders of magnitude more activity with USD vs BTC.
So for something that is used upwards of 100,000x more and only takes 5x more energy, that'd be a win for USD, no?
This of course is all disregarding my strong skepticism that the excesses of the US Military is a reasonable proxy for the strength of the US dollar.
That's quite an unbelievable leap. The USD infrastructure and it's energy needs is in no way dependent on reserve status. That's just grasping at straws.
The same plumbing handles a plethora of other, smaller currencies with many orders of magnitude better efficiency than BTC does (yeah yeah Lightning, off chain, blah blah).
At least I assume Bitcoin obviates all of those things since I keep seeing them brought up in comparison to Bitcoin's energy usage.
And for that matter, I don't accept the theory; it reeks of motivated reasoning to me.
What's the environmental impact of better refresh rates on monitors? What's the environmental impact of large scale cctv systems? What's the environmental impact of western-style mattresses?
That's why Bitcoin/PoW is in a different category to me: It's a Red Queen's Race where all the miners are incentivized to keep wasting more and more energy (for no greater benefit) or else risk that somebody else can execute a 51% attack.
Imagine if your email host needed to keep burning more and more energy, not to send any more emails, but because if they ever backed off, somebody else could steal your email address from you.
You wouldn't criticize a government for spending millions keeping ita gold reserves safe, even though it can store them just as easily in a warehouse as it can in fort knox
It's not like Russia adds one more guard to their gold vault, the US has to keep pace or else if Russia has 51% more guards outside their vault, then by magic they can suddenly steal/double-spend gold.
Do bitcoin folks really not understand this, or are they all just pretending to be blind because they hope it will make them rich?
Rhetorical question, BTW. There is no market mechanism that determines what is sufficient security. This should become clear if one looks at what the network is choosing to pay the miners who secure transactions.
The block reward is now 12.6% of what it originally was, and tx fees have certainly not gone up correspondingly. So is the network now undersecured? Or was it previously overpaying for security? Again, rhetorical questions - the users of the network aren't paying for security, they're paying to have their transactions processed and have no choice but to subsidize the miners with the block reward as well. As far as how much security is needed goes, the Bitcoin answer is simply "more is more."
But in the future, as the block reward dwindles, won't market forces start to price in security? I'm sceptical, personally, because the only gauge of whether or not the network is paying its miners enough is whether or not the network works. So if, in the process of finding the proper price of security, the market goes too low, attacks will be possible and the price of BTC will likely suffer as a consequence. This would make it less attractive to mine BTC and less attractive to use BTC. You can see how this could lead to a downward spiral.
Hundreds of dollars are too much for the average joe to regularly open and close lighting channels, so we might see some kind of centralisation.
The big question is if bitcoin can provide enough value as a international settlement backbone to fund the biggest pool of sha-mining hardware in the world. If an alternstive usecase for sha-miners comes up (be it blockchain related or not) that would also be a bigg security blow (but I don‘t see this on the horizon for now)
There are lots of cryptocurrencies which have infinite supply, which means that the mining rewards will keep the network running. For example Ethereum, Monero, Dogecoin and Grin. Bitcoin will rely on transaction costs, but it doesn't provide fully deterministic security as far as I know.
As for mining, it is necessary for reasons that have nothing to do with security. If you want to send a tx, you will pay a fee or perhaps hope for a kind miner to include your spend in a block. In no way are you signaling how much you think the Bitcoin network should spend on security.
Well, there are - think of bcrypt :) It actually fits exactly the definition of design that deliberately becomes less efficient.
Ultimately it's a matter of the perceived cost/benefit - encryption is deemed necessary, so the benefits [perceived] offset the costs, while the cryptocurrencies' benefits don't (or do, depending on the opinion).
No, they aren't motivated by that. They are motivated purely by profit. If more miners start mining, the difficulty goes up, and therefore profit goes down. So they need to keep adding more machines. The price is driving this cycle too. The current hashrate & difficulty are at their ATH levels.
(Edited)
The bitcoin advocates like to pretend this is somehow about "securing the network" instead of pure greed, but it doesn't matter either way. Even if we take them at their word, the miners have to keep pouring in more and more energy or risk a 51% attack.
If you read bitcoin.pdf, the security depends on the % of miners that are honest.
In a nutshell, more energy just means that the "difficulty" goes up, i.e more hashes are required, but that's nothing to do with security.
I’ve finally accepted that I have to switch to Firefox because of Chrome’s performance problems. Apple and Intel and thermals are a know problem, but Chrome is awful too. There seems to be some sort of problematic interaction between MacOS, Chrome, and Google’s software updater that triggers runaway CPU usage. See:
https://mobile.twitter.com/lorenb/timelines/1338892756752732...
If there’s a flaw here that turns millions of computers into space heaters, what’s the impact?
Inefficiency is all around us. The Bitcoin inefficiency is by design and it’s a big part of why Bitcoin works. On the other hand, it feels like the paper clip game; eventually all matter in the universe will be converted into energy to mine Bitcoin.
This is like saying why should a massive agricultural project worry about saving water when your uncle Steve leaves the sink running while brushing his teeth. Or complaining about a splinter while impaled on a 2x4.
The scale of the inefficiency is so large as to be difficult to truly comprehend.
That could be true, but how much energy does the finance world consumes through all the quantitative easings and other shenanigans? I doubt it's even possible to burn that worth of energy in electricity.
Over 75% of bitcoin miners are also now merge-mining (mining for other blockchains like RSK for example so this hash power secures not only BTC, but other currencies as well.
try sending money to someone in north korea. how many hours does that take?
> actually interested in them as currency
it is still a currency.
North Korea leader has an army of hackers trained to steal bitcoins and uses them to launder money...
probably not the best example
Thats the best defense for Btc you have?
>it is still a currency.
The only people consistently using BTC as currency are drug dealers or drug buyers.
it is the most obvious use case that is superior to everything currently in use.
> The only people consistently using BTC as currency are drug dealers or drug buyers.
no. but even if true, does that make it less of a currency?
First of all, countries secure energy because people want energy. Even in a world where we use Bitcoin, people are still going to want HVAC, cars, cell phones, and all the other things that we use/buy that consume energy and damage the environment. The idea that a country will magically stop wanting oil because it's using Bitcoin is just laughable.
Second, Bitcoin uses a ton of energy by design. It's literally built to create a competition between miners for hashing power in order to prevent 51% attacks. This structure is why increased hashing efficiency hasn't reduced Bitcoin's energy usage, it only results in spending the same amount of electricity on new hardware rather than old. A country that runs on Bitcoin will need a bit more energy as a fiat country, because maintaining sufficient hashing power will suddenly become a strategic problem. Up until today the risk of a 51% attack on Bitcoin is a private concern; only the miners and those involved in Bitcoin are concerned about it. But if a country used BTC as its main currency, suddenly that is a strategic problem. Does anyone honestly think that the USA wouldn't use its military to secure oil in order to hedge off a 51% attack on its entire financial system? Honestly, it would be dereliction of duty to not do that, given that scenario.
I don't really care about the USA, and I want to be in control of my own money. Maybe from your perspective of being able to control the citizens of a country, USD is better. But from my perspective of protecting my own interests, BTC is a compelling solution.
The funny thing is that we know that neither fiat currency nor oil is necessary for empire building or warmongering, because both fiat currencies and large scale oil consumption came out after the greatest period of imperialism and colony building that humanity has ever seen. The idea that replacing something that’s been around for ~50 years will solve a Millenia long problem of humanity’s is just funny.
Is it? Communicating over distance was a problem we've had for millenia (or much longer) and it's now solved. Technology is amazing and we hit an inflection point last century. We're essentially already living in a post-humanity world, and crypto is the currency to match.
There's a reason why I say that bitcoin fans participate in magical thinking, and this is a prime example. So the argument goes that because we've solved communication, bitcoin is supposed to solve war ... how again? There's not even a fig leaf of an argument here, only a blunt assertion that because we've solved other problems, therefore your preferred technology will solve other issues.
Maybe one day we'll solve war. But the burden of proof is on you to argue that your specific thing will solve that issue. And you're not even really trying.
> We're essentially already living in a post-humanity world, and crypto is the currency to match.
Lol, what? This is the intro to a cyberpunk novel, not an actual argument with testable claims. What the heck does "post-humanity" even freaking mean? As an actual human being living in this society, I'd argue that any claims that I'm "post" are objectively wrong.
This is always the issue with any sort of enthusiast; your enthusiasm does not scale. Just because you're really excited about a thing doesn't mean that anyone else will be; you have to actually find things that other people want and connect your interest to them persuasively (blunt assertions don't really work). "We're already living in a post-humanity world, and crypto is the currency to match" is the kind of thing that'll get you plaudits on crypto sub-forums, and worried looks from everyone else who has no <explicative deleted> idea what you're going on about.
If anything, limited supplies of anything, including bitcoin, are a likely to spark wars, not end them.
If you truly wish to help stop wars, join a peace-loving organization, attend marches, lobby politicians. You'll find all of the real work on this are in leftist organizations, which fight against the real foundations of war, such as inequality, ideas of exceptionalism, corporate greed and others. Fiat currency is well down on the list of the world's problems.
Quite the contrary. You'll find that many currencies were created specifically to support an army or war.
If the US government wanted to go to war, was lacking money for this, and for some reason didn't want to seize the entire bitcoin network (which it could pretty easily do, make no mistake), it could simply issue its own cryptocoin, just like in 1652. And people will buy it, because they know the US is good for it, for the same reason that dollars don't particularly devalue even if you print another hundred billion of them today.
It's important to understand that you can't fight social problems with technical solutions. The disgusting amounts of power that big states have make it impossible to oppose them with fun projects like bitcoin. If you are truly serious about combatting US imperialism, try reading some Noam Chomsky - that is a man that has spent his life fighting against these things, but also understanding the levers of power.
Financial games are in the end games; they may seem important because it is where the rich spend their time, but if push comes to shove and the system is threatened, the game is quickly stopped and any necessary controls is asserted. Just look at what happened with the GME stock (and we haven't even seen the end of that). Make no mistake, if BTC ever becomes a real threat to any monetary system, you will see much worse than that.
This can only be combatted in the arena of politics and democratic control, by changing the rules, not playing the game.
2. Fiat is not a social problem but a technological one that crypto is well poised to take on.
3. BTC is well on its way to passing gold in aggregate value. It's safe to say, it's no longer a "toy".
4. I'm left of Chomsky but in general, a big fan.
2. I don't understand how fiat is a technological problem. Fiat was a solution to the problem of a fixed supply (gold-pegged) currency. Crypto is generally a step back.
3. The value of bitcoin is irrelevant to its impact on global financial systems. It can handle 7 transactions per second, while consuming more power than the Czech Republic. That people are willing to bet good money on it for now is does not mean that is should be taken seriously as an alternative to anything in the financial system.
4. Interesting, I honestly expected from your arguments that you were more in the area of a more-socially-conscious-than-average Rand Paul fan, glad to hear I was wrong.
2. Fiat is a technological solution, as is Bitcoin. Really though, the dichotomy between "social" and "tech" solutions is false. Technology and society are one and the same.
3. BTC has moved billions of dollars into crypto. That crypto can be pegged in smart contracts on more appropriate tech stacks (like ETH) to enable currency use-cases with alt coins. It's early days here, but very exciting.
4. There's not many leftist libertarians but it is an actual philosophy. Individual liberty + social and humanitarian thinking + acknowledgement of the role racism and exploitation has had in today's power structures. I believe in radical decentralization and leveraging technology and automation to make life better for all.
2. I was wrong in my explanation, you're right that fiat is a (social/financial) technology and in principle crypto could be an alternative. What I was thinking of initially is that the problems of the finance system are social, not technological: the incentives in the current system (the rich keeping their richness at the expense of everyone else) are a social problem, which can't be fixed with technology. As long as the rich stay rich and powerful, they will control crypto just as well as they controlled gold and fiat before it.
3. ETH can do, what, 24 TPS? Right now there is no coin that can realistically compete with the global banking system, especially on the last mile. And I don't think PoW or PoSpace will ever get there. And PoStake doesn't seem like it has any real advantages over a trusted distributed DB, to be honest.
4. Those are quite noble goals. Probably a major difference of belief between us is that I don't believe any change towards decentralization can come from (computer) technology, I believe it must be a social movement with democratic power that moves things first and foremost - any kind of purely technological solution will easily be co-opted by the rich and powerful. In this way, crypto should look at what happened with the Internet itself, as Google and Facebook and others slowly absorbed it.
Arguably currency is a consequence of wars, as are markets[0]. Markets and currency (fiat & hard specie) are usually the consequence of states needing to raise armies, equip and pay for armies, and do something with the tribute collected from vanquished foes. Small scale agriculture can work on either physical barter or interpersonal debt systems, it's only when you need to equip and train men to fight full time that you need actual coinage and markets to produce arms for them and do something with whatever they seized abroad.
Assuming that one accepts this, this is actually a pretty big problem for the "bitcoin will stop wars" crowd, as arguably currencies are a consequence of wars and not vice-versa. If one wants to stop wars, one has to tackle the root causes, not the side-effects.
Furthermore, it's also clear that it's possible to organize and fund wars on the back of several different types of currency. We've seen wars funded with hard specie (early Roman Republic/empire), diluted hard specie (late Roman Empire), wheat backed coin (Sumaria), lead (Sparta), paper notes backed by land (French directory), gold backed paper (America pre-1971), fiat (everyone nowadays), and probably more still. There's really no clear reason why one couldn't use a cryptocurrency to organize and fund a war.
Heck, if they actually worked it would probably make modern wars a bit easier. Modern conflict often involves the funding of proxy groups with a variety of openness and plausible deniability. This usually requires the actual transit of physical money, which is dangerous and expensive. The ability to just digitally wire a bunch of currency to your proxies without the need to fly pallets of money and gold to your proxy fighters would simplify things significantly for current world powers. The ultra-private currencies would be a pretty good way to send money to terrorist and rebel groups you don't want to be seen visible funding too.
0 - For more on this see David Graeber's Debt, the First 5000 Years.
To the extent that inequality, competition, and unfairness create tension, that tension doesn't go away just because there's a different set of people at the top.
Come on. Of all of the cryptocurrency-utopia claims that exist, this is surely the least believable.
There are so many new things we can do with crypto that it's going to take decades for people to discover them.
However calling my bank and having cash recalled from fraudulent (or even just bankrupt) merchants, that's happened. Who do I call at Bitcoin?
The benefit of BTC is that when your bank mismanages their assets a la 2008, resulting in a bank run, you know your assets are safe instead of having to rely on the Fed to bail out your bank. Your money is in your control, not in the control of someone else.
If you don't want that, it's easy -- just don't buy bitcoin. But don't discredit it by comparing it to a credit card which it is not trying to be. The strawman is disingenuous and shows how little you understand the topic.
The point is when we're looking at comparative energy use, you can't just point at the whole banking system and compare it to Bitcoin, as if it's an apples to apples comparison, because the banking system provides an embarassment of services that Bitcoin does not.
> The strawman is disingenuous and shows how little you understand the topic.
There's no strawman here and if anything this shows how little you understood the thread you're replying to.
(Edit: fixed a copy/paste screwup)
Sorry, this does not make BTC a bank.
As they continue to add more features, we will see what BTC will become and how it may be useful. But comparing it to a bank is silly.
I agree, Bitcoin is not a bank, that makes comparing its energy footprint to the banking system totally pointless.
[1] https://www.coindesk.com/what-bloomberg-gets-wrong-about-bit...
this is true. bitcoin should be compared with everything required to run or "back" USD. which is a lot more energy use than most states on this planet
I don't think that's true. Most companies providing services on top of bitcoin control the private keys, so they could do the same thing. You give up absolute control of your money to get access to a service, except now creating the money is terrible for the environment and consumes as much power as a small European nation.
You say that now, but it's the kind of innovation that will require some time to develop use-cases. I use it as an example of where crypto is just a lot more powerful than traditional banking. There's the ability to scale without "permission". Think a 12 year old opening an "account".
> However calling my bank and having cash recalled from fraudulent (or even just bankrupt) merchants, that's happened. Who do I call at Bitcoin?
Escrow accounts and merchant layers are in development. There's a lot of interesting DeFi (decentralized finance) services being developed on Ethereum.
Right, so that means that Bitcoin is not providing many of the services the financial system provides now, so comparing its energy footprint to the existing financial system is pointless.
That's the point I was making. You can't say "Bitcoin uses X electricity and Finance uses Y, which is bigger, and so is worse" when Bitcoin doesn't provide the same services or service the same size of audience as existing financial systems do.
But I'm glad we agree the comparison with the existing system is a silly one.
what about sending money to someone far away? ever tried? or just living in a bubble using a single fiat to buy coffee
your limited use argument is tiresome. you can not send money to anyone you want with fiat. most can not send money to you. you are not free
my grandgranparent sent money back home to Italy from the US in 1912...
my grandgrandmother had no electricity, no running water, could not read, but could use that money.
now do the same with bitcoins.
anyway this sentence
> you can not send money to anyone you want with fiat
is not true.
I don't know what bubble you live in, but the opposite is true: you can't send bitcoins to anyone you want.
> I don't know what bubble you live in, but the opposite is true: you can't send bitcoins to anyone you want.
the opposite to "you can not send money to anyone you want with fiat" is "you can send money to anyone you want with fiat". which is false. hence initial statement is true. there is no bubble here.
friendly advice. read more.
thanks, I am a software engineer with 30 years of working experience, still find bitcoins the most obtuse way to send money, first of all because bitcoins are not money, secondly because 100% of those I would send money to don't know anything about bitcoins (why would they care?) and last but not least because it's easier and cheaper to convert money to gold and ship the gold (assuming I don't want to send real money)
buying prepaid credit is also an option, it works everywhere bitcoins work and it's free, immediate and it's money, directly spendable on goods and services
hell, even shipping banknotes in an envelope is better than sending bitcoins!
bitcoins are useless for this use case to anyone who really wants to send money to someone they care about
> "you can send money to anyone you want with fiat". which is false.
it's not.
I can send fiat money to anyone I want (emphasis on I)
but to prove me wrong you can send a couple bitcoins to my mom and I'll show you she doesn't know what to do with them.
if you're interested in proving me wrong, I can give you her wallet address.
in the end ask yourself this: why North Korea is disconnected from internet, but allows bitcoins?
are bitcoins really pro people and against oppressive regimes?
p.s. as much as I don't care about burn accounts, yours is actually really suspicious...
If you need to do this, you can do it through the group at your bank called treasury services (or something like that). They have APIs for financial services customers and CFOs who need to do this sort of thing.
Anyone can do this now with HD wallets.
That’s moving the goalpost.
There isn’t any barrier to programmatic banking. The use case is too narrow for it to be a widely-advertised service.
> There isn’t any barrier to programmatic banking.
There absolutely is, there's no open API for this.
There is a difference between not being able to and not knowing how to. You can. There are no-minimum balance API banking interfaces. There just isn’t a common enough use case for them to be heavily advertised.
We can move the goalpost again to an open API, but that’s another thing once more.
Yes, easily.
It would take a phone call, since I haven’t set up the rails to do this. But “I need ten thousand sequentially numbered checking accounts with wire privileges” is a perfectly fine (if odd for an individual customer) request. (Almost any process requiring that many accounts is being done wrong.)
Granted, I have a private banker. But there are services who provide this to e.g. fintech companies setting up and destroying single-use accounts on the fly.
OP meant legal things.
Datacenters use about 205 TWh/year.
https://www.networkworld.com/article/3531316/data-center-pow...
Bitcoin uses about 75 TWh/year.
https://digiconomist.net/bitcoin-energy-consumption
And that's with everyone on the planet using normal money every day and just about no one using Bitcoin.
Some Bitcoin-related stuff is running in datacenters, no doubt, but it's a rounding error compared to the rest.
I've been unable to find any rigorous research on this, but even the pieces defending bitcoin claim that the banking system consumes maybe 5 or 10 times as much energy as the bitcoin network, while neglecting to mention that the traditional banking system handle hundreds of thousands of times more transactions per second than bitcoin (especially funny since the estimates include stuff like the AC costs of bank branches - obvious sophistry).
It uses "Proof of Space" (proof that you're allocating a certain amount of storage space) instead of Proof of Work or Proof of Stake. Pretty interesting and they're coming out of beta into their mainnet in the next few weeks. Their on-chain programming language is even Lisp-based!
And nobody cares. If I had to guess, I'd say the attractiveness of mining the PoW coins is that it's very expensive, but accordingly very rewarding.
When the coins are cheap and easy to secure as a node, people seem to not be as interested, which means the coin doesn't get used.
Chia, Sia, Filecoin all are trying to do similar, but have added in a "distributed Dropbox". There are some interesting challenges there, like quintuple redundancy and having your files stored across multiple nodes in shards for privacy. But in the end, they seem to suffer from the same issue as BURST: their feature set struggles to create popularity because they're not Bitcoin.
If they did that, they'd get over the "we're not bitcoin" hurdle, assuming the tech was any good.
That way there is no proliferation of coins, and people will have trust knowing each of your altcoins is backed 1:1 with bitcoin.
And while it may be low energy to run, creating hard drives just to prove you have space seems a less than environmentally friendly activity.
It looks just like another proof of waste
The main cost of hard drives is intellectual property (ie. Paying for the R&D, patents and licenses for all the tech inside).
It isn't clear that "wasting" intellectual property is in any way bad for the wider economy. In fact, it probably just subsidies storage for the rest of us in the long term.
Just like PoW it makes sense to spend enough until a breakeven point. In thise case there is a direct incentive to buy as much storage as possible.
Instead of electricity consumption the limiting factor will be raw materials to manufacture storage. Likely even worse for the environment given the energy and raw material cost to manufacture storage devices.
Storing the whole chain takes a bunch of space anyway, so you have a similar storage problem there too.
If you want to see how cheap persistent storage can get, look up the cost of Amazon Glacier. It's shockingly cheap - $0.005 per GB or even less.
GPUs or ASICs for hashing are going to have a limited life span just like your storage hardware, too.
In PoW you can lower your environmental impact by using clean electricity. For Proof of storage it would be 100% manufacturing.
The probability of being awarded a transaction is proportional to your reserved space 'plot' compared to the globally reserved space. Assuming it takes off, and enough 'overprovisioned' storage has been added to the pool, then it makes little sense to buy hardware just to farm storage-coins. The tiny increase in probability just wouldn't pay off.
You set up a system, which inherently ensures a certain resource will remain/become scarce (...for all of humanity), or fail. That's just super counter-productive for human prosperity...
There are things Bitcoin is better at than e.g. credit cards. If you're a trusted merchant with shady customers, once the transaction posts you don't have to worry about scammers fraudulently disputing the charge or your bank cutting you off because that happened too often. You can get Bitcoin under a pseudonym and use it to buy something (e.g. banned or controversial books, VPN for dissidents) that you don't want tied to your meatspace identity. Things like that.
None of this would be impossible to do with ordinary financial systems except that existing regulations prohibit it. But if anybody can do it with Bitcoin regardless then there is no point in that and you might as well allow it in general. At which point, why are we burning all this energy on Bitcoin?
But more importantly, as far as I know bitcoin is not designed to guarantee anonymity in money transfers, and the fact that every transaction is set in stone publicly in the blockchain makes it relatively easily traceable. Am I wrong in that area?
And of course even if transactions themselves were fully anonymous, many people end up needing to rely on exchanges, and the idea of those being truly anonymous is borderline absurd.
Adding friction to non-illegal actions is harm, not benefit. Adding friction to illegal actions is the opposite of what happens, because it's enabling something that wasn't previously possible. Also, criminals can survive higher friction than dissidents and vulnerable populations because the illegality creates a moat that raises margins.
It's why drug cartels make billions of dollars and can finance submarines and stuff but marginal changes that nobody thinks through the implications of get dissidents killed.
> But more importantly, as far as I know bitcoin is not designed to guarantee anonymity in money transfers, and the fact that every transaction is set in stone publicly in the blockchain makes it relatively easily traceable. Am I wrong in that area?
Every transaction is public but it's only the transaction and there is no requirement to reuse the same wallet for multiple transactions.
You go to some cryptocurrency hangout, pay some stranger a hundred bucks in cash and they transfer a hundred bucks in Bitcoin to your wallet. You go pay for a VPN with it. Then everybody can see that A transferred money to B and B transferred money to C, but nobody knows that you're B and those are the only transactions for that wallet.
Also, there are cryptocurrencies where this isn't the case and you don't even get that.
Nobody? Some stranger from above knows that you're B!
Essentially you have to create a brand-new, single-use wallet for every transaction, am I wrong?
Already they have practically banned p2p bitcoin transactions in the US. They're closer to their goal than we are to ours.
In 2011 I gave a halfway tongue-in-cheek talk called "Financing the Revolution" about digital payment systems, with a focus on bitcoin and the new possibilities it enabled. It is still, all these years later, not really possible to finance a revolution with bitcoin.
I don't think that's in any way an accident.
Also they're willing to add a lot of inefficiency to their economies to retain financial control of their countries.
If you're a scammer merchant, ripping off good-faith customers you also don't have to worry about chargebacks. Bitcoin moves power from the consumer to the merchant. I don't see that as a net positive.
It's a common problem for adult products that the buyer's spouse sees the charge on the credit card statement, the buyer claims not to know anything about it and the spouse disputes the charge even though the merchant did nothing wrong.
Chargeback and other consumer credit-card protections are very useful. Regulations don't prohibit irreversible transaction mechanisms, basically nobody wants them.
Please don't just make stuff up. Point me to the credit card I can get which doesn't allow for chargebacks. I want to use it to buy things from people I trust who don't trust me, because that is an actually useful thing that some people have a legitimate reason to do.
1. That makes you sound actually crazy.
2. I didn't say you could get a credit card that doesn't allow chargebacks, I said the regulations don't prohibit payment mechanisms without chargebacks. See for example cashiers cheques and bank transfers. There's a reason people avoid them, and a reason popular payment methods support them.
The fact is that reversibility is a feature.
I don't see why this is so difficult to understand.
You have a merchant with a sterling reputation. I'm a customer. They don't know me from Adam, but they know that a lot of their customers are unreliable. Suppose the product is bespoke or controversial, so they have a lot of problems with people placing an order and then backing out and refusing to pay after the work is already done or the product is already delivered.
In a system with chargebacks, they have to eat the cost of that and pass it on to the honest customers. In a system without it, the people violating their agreement and backing out can't get their money back, and then honest customers like me don't have to pay more to cover them. So I'm willing to commit to trusting the merchant in exchange for not having to pay more. In this case forced reversibility is a cost to me, the customer.
> See for example cashiers cheques and bank transfers.
In other words, things that are de facto prohibited through inconvenience or risk. Like a website is going to get any customers if they have to drive to the bank and then mail a cashier's check. And disclosing your bank routing number would allow the merchant to withdraw more than agreed -- you then have to trust them with not the $20 purchase you're making (an acceptable risk) but the full balance of your account (not so much).
Notice that the convenient equivalent to this that might actually be usable, i.e. debit cards, is back to having chargebacks.
For your contrived example, a bank transfer would work just fine, and can be done online in seconds. Good luck if the 'trusted' merchant decides to cash in their 'trusted' reputation by taking a lot of people's cash and skipping town, or if their business just plain goes under before you can get your items, though.
> In other words, things that are de facto prohibited through inconvenience or risk.
This is not the same as prohibited.
> And disclosing your bank routing number would allow the merchant to withdraw more than agree
Why would you be exposing anything? Sending a bank transfer doesn't allow anyone to withdraw anything. A cashiers cheque even less so - it comes from the bank, not your account.
I haven't looked into this, and I don't endorse this data or the comment, but it's likely relevant to your question:
Bitcoin uses about 1/3 the energy of all datacenters in the world put together. Datacenters use about 205 TWh/year.
https://www.networkworld.com/article/3531316/data-center-pow...
Bitcoin uses about 75 TWh/year.
https://digiconomist.net/bitcoin-energy-consumption
And that's with everyone on the planet using normal money every day and just about no one using Bitcoin.
This is starting to sound like a chorus.
On coal power: It's bad to use coal to mine Bitcoin, but it's bad to use coal to provide power for any activity. Coal power should be banned outright.
From a quick skim this article seems like it might have some good data, but it also has a bunch of loaded language in it that turns me off from wanting to read the article.
"Bitcoin and other PoW coins are an ESG nightmare"
"This paper looks at the energy consumption of seven proof-of-work-based anarchic (public) blockchains such as Bitcoin and Ethereum." (You know how anarchy is bad right, well we're going to say these are like anarchy, so they're bad too.)
"Many Bitcoin promoters conjure a future world...[where Bitcoin is king and leads to renewable energy]" (they're like spellcasters, this future doesn't really exist, they're trying to pretend they will create it out of nothing but they never will!)
"Putting aside the continual greenwashing that many advocates are guilty of" (You know how whitewashing is bad? Well so is greenwashing! I'm saying these people do that and that means they're bad!)
"The container ship fetish is a slight-of-hand[sic] trick..." (These guys have fetishes and fetishes are bad, also they're using slight-of-hand and tricking you, and tricking people is bad!) Also the writer misspelled 'sleight'.
If they wanted to change minds the writer should have used more neutral language in their sentences. You can be persuasive without resorting to this. I'll sit down and read it a bit later, but not feeling like trudging through all this loaded language.
There are too many bagholders, excuse me, "investors" who are financially motivated to keep pushing this stuff.
There are very few bagholders.
What is “pb” in this context?
I did read a little bit to see if it's worth reading later, and was really annoyed by its loaded language, and wanted to point it out to people who might not notice otherwise. Seems like, for the most part, at least right now, people agree with me.
Also I can't even go back to read it now if I wanted to, since it's now serving a 503 after being slammed with traffic, I assume.
The energy 'argument' is easily debunked. But that's not what this comment is about, so I won't rehash it here.
Trying to change people's minds on here doesn't work. But you know what? That's okay!
It signals us bitcoin holders how incredibly early we are in this life changing monetary revolution, that we are seeing unfold before our very eyes.
Bitcoin was meant to be attacked from all angles, non stop. It's what makes it so resilient.
If it can fail, it must fail.
But it's not failing, is it?
Quite the opposite...
Every bitcoin newcomer who reads this FUD, is going to remember it years from now, when bitcoin is still around and at higher prices than ever.
And they'll think to themselves... "Well, if after all these years, bitcoin is still around, despite supposedly being a bad thing, then it might not be such a bad thing after all!".
So I say:
Let they naysayers attempt to take bitcoin down. It will only result in new all time highs for my portfolio. And for that, I am grateful.
The early bird gets the worm. The late ones convince themselves the worms are poisonous, leaving more worms for the early birds.
Nature takes its course.
One can invest in Bitcoin if one wants, but only because The Market Can Remain Irrational Longer Than You Can Remain Solvent
The crypto market is now just gettings its first billionaires to invest in it (Michael Saylor, Elon Musk, GrayScale, etc.), and the market cap is still small. This is just getting started.
There's definitely a risk it could go down. Bitcoin has been super volatile in the past, and has cratered to 20% of its price before and probably will again. Might even be relatively soon (within a year, I'm guessing).
But people who have held on to the asset through those dips are now doing incredibly well, assuming they sell before the next major dip (and probably even if it they don't, 20% of $48,000 is $9600, and if they bought while it was $3500 a year ago, that's still triple what they bought it at).
People who have bought and held since it was $220 back in 2015 are likely doing extremely well.
There's very few assets out there that can offer 200x returns in just five years.
Real estate existed (and still exists) in a world of inflationary government IOUs (read: fiat). People were taking out too many & too large loans. Ofcourse it was going to go bust. People were talking about it. The author of the book he linked, was being a contrarian.
Bitcoin has created its own reality, which has only just started to gain traction. It's the early days of the dot com boom. It's the early days of SEO.
Every informed individual sees the writing on the wall. Something doesn't grow for 12 years straight, unless it's got something interesting going on.
To state that bitcoin is going away, is the equivalent of stating that the Internet is just a fad that will soon die out. It's an inherently contrarian view.
But while we may be nearing (or at) the end of the era of crazy drops, where everyone thinks "Oh crap, it's all over, time to jump off the ship!" and bitcoin is now in a 2+ year bear run, I can't discount the possibility, and the price still swings up and down in price quite a bit even as recently as two months ago, so I think it's possible that we could see see a fairly big, somewhat sustained drop again (maybe not a whopping 80% drop, but 30-40% maybe? I'm also hopeful it won't last as long, like maybe only 6-12 months, not 24 months).
Bitcoin is fantastic. But even fantastic assets can become overvalued. And indeed, this will happen again. There will be another bear market.
I keep myself up to date on the market sentiment every day. I have been doing this for years now. The current sentiment is that we are in the middle of the bull market. Both billionaires as well as retail buyers have only just arrived.
Everything is going much, much higher for at least the rest of the year.
If the market cycle repeats like last time, the bull market will last at least the larger part of this year.
If the cycle is lengthening, as you'd expect when market cap grows larger, then the current bull rally will last longer still: say... to the end of 2022.
The question is: are we currently at the knee of a larger S-curve?
If so, then we are truly witnessing a rare event, in which asset appreciations will truly blow us off our socks.
In such an event, bitcoin would become too scarce for it to do another 85% retrace, which is what it's done in previous market cycles.
(Any by the way... the 30-40% figure are considered normal retraces, of which we usually have multiple during a larger bitcoin bull run.)
Billionaire Michael Saylor from Microstrategies is saying that he's not selling. Billionaires are, in this regard, different from retail, who do sell.
The only way to estimate bottoms and tops successfully, is to be right on top of it every day of every week.
You snooze, you lose.
Except for whether we're in a bear or bull market. It's definitely a bull currently.
It looks like it should last longer based on the institutional investment, but I also thought we had enough interest three years ago and suddenly we entered bear territory (thankfully I luckily sold some of my crypto a week before it started to drop for a downpayment on a house, but I held on to the rest for way too long, way too long meaning I never sold, and should have sold and bought back in a year or two later, in hindsight). At least I still have it now for this boom, but I could have had double or triple what I have now.
But I'm watching the market and news like a hawk in case sentiment seems to shift back to 'the sky is falling' suddenly again.
Regardless of people buying fractional shares, I see plenty of people on the bitcoin subreddit going "I'm a noob at bitcoin, and FOMO bought 0.1/0.2/0.4 coin yesterday for $46k, did I make a mistake, is it about to drop?"
Those people are still putting in thousands of dollars, and some of those people probably aren't so financially stable that they feel comfortable seeing the price of bitcoin drop 20% in 48 hours like it did a month ago, they could end up selling and losing thousands of dollars as a result.
I only put in a little every month, money that I'd probably just waste otherwise, so I'm really happy it's up but I'm not super stressed when it drops. But I acknowledge that not everyone does what I do.
Regardless of how it was born, I don't think it qualifies as anarchy now, especially with how it can be tracked and regulated (indirectly, i.e. it can be banned, transactions taxed, exchanges subpoena'd for transaction information, ledgers tracked, etc) by governments.
(AMP link because coindesk hid the article behind a fake 404 page)
The same to our legislative bodies, human society is having an anally retentive crises when it comes to technology. The system’s chocked and cant function well.
Accelerando is great btw
[0] https://www.youtube.com/channel/UCZFipeZtQM5CKUjx6grh54g
Can you not smelt aluminium in remote areas? Can you not perform hydrolysis to generate hydrogen?
There are plenty of other good uses for electricity besides bitcoin or powering a city directly.
> There are plenty of other good uses for electricity besides bitcoin or powering a city directly.
The argument "uses lots of energy = bad" is a fallacy. You have to take into account what the alternatives are. You know what uses a lot of energy? Public transit systems. But nobody is arguing that public transit systems are bad because the alternatives are a lot worse.
It's disingenuous to pretend (without any sourcing) that bitcoin is only mined using electricity that would otherwise have been wasted.
If this were really true, then bitcoin miners should all be getting paid to act as load banks[0] for their local electrical grid and soak up that excess power. Since they are instead paying for electricity, they are using valuable electricity, not spare/waste power.
And it's useless until you spend more energy to move it to where people want it.
> It's disingenuous to pretend (without any sourcing) that bitcoin is only mined using electricity that would otherwise have been wasted.
It doesn't have to be only mined that way. You're being absolutist. Competition has resulted in bitcoin mining being very sensitive to energy costs. It stands to reason that miners--especially the ones operating at large scale--will move to places where there is cheap energy.
https://www.publish0x.com/muchograph/top-5-biggest-bitcoin-m...
Several of the big mining operations mentioned there are located in places known for cheap electricity. Genesis mining relocated to Canada and Iceland specifically for cheaper power. Gigawatt is located in Washington State which has some of the cheapest electricity in the U.S. (part of the reason Google chose The Dalles, OR for one of their data centers).
Edit: the article examples are just infuriating. "Bitcoin is a battery" No, absolute-fck-lutely not!
your electric cars as well combustin engine cars use lot of energy worse than Bitcoin. oh cars get you from point a to point b. guess what, Bitcoin gets your value from point a to point b more efficiently than anything else out there yet and it maintains so keeping it as the hardest money known to humans
gold mining, banking services use lot of energy
you playing xbox or publishing dumb articles on an ad-tech trojan horse also takes energy
learn and adapt , else get extinct
https://www.coindesk.com/the-last-word-on-bitcoins-energy-co...
This means when there is more available energy it's lucrative for miners to put more energy in the system. However, no more bitcoins are outputted. The only extra output is heat from used hardware.
In some other related topic on HN, someone compared it to a car, where more energy would not just mean more miles driven, but an equally longer road.
But I do hope that in that future we also use that energy a little bit smarter, and proof of work's incentives are indeed aligned poorly from this perspective.
Disclaimer: I am conflicted about the subject, because I think there is merit in crypto, and also hold some myself.