Coinbase outages
coinbase.com
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People are free to gamble, but could they please not turn the surface of the Earth into a black body radiator while they're at it?
[0] https://www.quantamagazine.org/a-new-thermodynamics-theory-o...
Given the entire argument seems lost on readers given the downvotes it's simple: proof of stake and increased use of crypto both drive down energy cost per transaction. The more people use crypto, the cheaper energy use per transaction assuming currency prices stay the same. (This is lost on most commentators, but it's reasonable to expect price stability in the post-speculation phase of crypto adoption.) And proof of stake and side chains stand to drive those costs down by several orders of magnitude.
A transaction meaning transferring money from one wallet to another?
Generally speaking, every 10 minutes! one block is mined which is incentivived with 6 btc or roughlyl the equivilent of over 150.000$.
In avg there are 1000-2000 transactions per block.
Lighting in particular solves transaction speed by introducing additional potential security problems that need to be accounted for, particular closed channel type attacks.
Non of my ways of buying/using bitcoins is doing it indirectly.
And i do have to assume that this is nothing you can't estimate. After all either those systems are known and used, than you should be able to verify that this is a potential lightning transaction block which contains more or so.
There's a lot of energy to secure the network, but the actual energy usage per transaction itself is a small fraction of that misquoted number.
Decentralised, fast, cheap: pick two.
It remains to be seen if there are good ways to do distributed currency, but there are certainly less bad ways.
If you want it decentralised it's going to be significantly slower and more expensive than centralised networks.
Increased cost is certainly not so straightforward. If you're sufficiently distributed, using already-existing hardware, with spare compute on extremely efficient devices, it could conceivably cost less. Even if a centralized server farm would be doing an order of magnitude less math, smaller processors use an order of magnitude less power to do that math.
Bitcoin proper has a central ledger- every miner needs to hear about your transaction to verify it. Lightning is a clumsy way of reducing how many actors need to be notified of your transaction. Better currencies include stuff like that as first class. It's all in the name of getting closer to a constant-number verification scheme that is closer to competitive with the O(1) of registering a transaction with a bank.
Centralized credit/debit cards exist so that a big wealthy firm can say yes, this person has enough money for this transaction and I will guarantee the transaction by paying for it even if they can't. What I would really like to see is distributed, automatic guarantees: when you buy something at a coffee shop, people running validators on wifi will pick it up and use their staked currency as insurance (hedged by the system) that they know accounts who trust this particular account, and the transaction is valid. More people staking and trusting this account means more trust by the larger system, which then only has to validate aggregated transactions. Anyone announcing themselves at a validator plugs in at a given level of aggregation, all of which have different staking/network/latency/storage requirements. Unlike off-chain transactions (eg lightning), the system is guaranteed at every level.
Any given transaction will still be validated dozens or hundreds of times. En bloc it will probably use tens or hundreds of times more energy than the server farms powering VISA. I'll be honest, I'm okay with that. I really like the idea of having a bank account that isn't tied to a company.
If you mean that the same amount of power would be used whether the blocks are full or empty, you are technically correct but in practice it's not relevant until blocks are consistently not full.
If transactions are critical for everyone, wouldn't that mean that keeping bitcoin mining alive is a fundamental part of transactions?
We could argue that fiat keeps databases running (if we ignore physical money) and bitcoin is keeping blocks mining active.
I don't think it is wrong to say megatwatts per transactions. We could ignore this completly and say 'the baseload of just keeping btc running is x megawatts per hour' and that would just ring the same bells.
I'm pondering if we could also say something like "btc itself as a cryptosystem motivates actors to consume megawatts per hour due to the interest in btc and the current fiat<>btc exchange value"?
Two glaring gaps in that concept...
First, energy use is not tied to transactions. An empty block uses the same amount as a full block.
And second, the transaction count we’re discussing is the count of settled base layer transactions. This doesn’t include the majority of transactions of value: those that occur off chain or through second layer transactions. An infinite amount of off chain and L2 transactions only need a single on chain transaction to settle.
Put another way - each validated block helps secure every single transaction that came before it.
I'm not going to argue that the energy consumption is worth it (I don't think it's sustainable myself). I'm only pointing out that energy per transaction is a bad metric if you want to have an honest debate. It's much more complicated than that.
In a sane world, the energy use and price would be tied to the actual usefulness of the currency. They are not. In roughly 100 years the energy use will be set by transaction fees and the number of transactions, but currently it's only proportional to speculative will.
When transaction fees incentivize mining, the incentive to mine will certainly be much lower. Arguably more secure, too- the block reward creates a separate incentive for large players to dominate mining, which lowers the diversity of miners. It's not at all clear that the absolute energy consumption will be lower than it currently is.
[1]: https://digiconomist.net/bitcoin-energy-consumption/ [2]: https://ycharts.com/indicators/bitcoin_transactions_per_day [3]: https://www.coindesk.com/price/bitcoin
Instead, new people took it over and kept the throughput to the rate of a 56k modem. Now for the cost of a single transaction you can pay for enough hard drive space to hold the entire chain and enough bandwidth for a billion transactions.
This is like building a sidewalk instead of a freeway then saying you need to build a network of gondolas over it that just plunks groups of people down at different places on the sidewalk to move people.
Transactions are the thing that matters. Simply securing the network achieves nothing if people cannot move money. That's why people measure the network with transactions/joule.
Yes, I'm aware there's off chain solutions such as lighting but it's unclear to me whether those solutions are viable long term.
Bitcoin and the Nakamoto Consensus is a breakthrough that provides a secure, global, uncensorable, decentralized store of value. With defined rules that can't be changed on the whims of a central actor. The energy is used to prevent bad actors from being able to rewrite the blockchain. Per transaction is a misleading metric (plus there are layer 2 solutions). You have to consider the energy used by militaries and banks to secure fiat.
When your government fails, as they have in many countries and eventually do in the long span of history, having such a store of value will be, well... invaluable.
I don't buy in the energy argument myself, but trying to justify the way you do sounds a little too kool-aid-y.
If, ever, it so happens that cryptocurrencies become anything more than a joke from the point of view of the global economy, militaries and banks will be required to secure their operations too.
Most people don't seem to realize that a store of value is stable.
Today ( just as in 2017 till the pandemic) has proven that BTC/crypto is not stable.
It has more similarities with a MLM scheme ( not really backed by anything ( eg. Stable coins - tether), unregulated, limited withdrawals of your money on the exchange).
I don't believe anyone actually thinks BTC is safer while it's influenced by memes instead of actual market conditions. Well, except if the reason is greed and personal liability ofc.
Ps. The only reason to have some crypto coins is for diversifying your portfolio. If you consider the risks carefully, as with everything else.
If you zoom out on USD, it's not exactly stable either. It has greatly decreased in value due to inflation over the years. Or worse, if you zoom out on bolivars and other currencies. Anyone in country with hyperinflation, or at risk of it, very much appreciates a permissionless global store of value.
Hyperinflation means that that market is in trouble, you can already hedge with USD/gold in most cases, which is actually backed by something. Losing a couple of % over years is a tested strategy and a requirement for healthy economies. Most people that talk about BTC and hyperinflation don't understand basic economy and are just looking for an excuse for BTC to rise because of... Greed.
Additionally, BTC was new in 2009 and I cashed out 2017 and never looked back. It's not new anymore and hasn't been for a long time, a lot of accountants even got courses about the blockchain in Belgium 5 years ago.
Everything of 2016-2017 repeats. Then it was adopted by steam, woocommerce, square, Amazon, ... and they all removed it again or never finalized the integration, because of not enough usage. That's 5 years ago and everyone was talking about it and it was in every possible media in every country. That is: Newspaper, tv, going out, Reddit, here, ads, ... I even had a site with some popular articles on it ( how to recover your bitcoin password was by far the most popular one fyi)
Today it's just Tesla and they also removed payment.
Ps. Countries going to do digital currencies are not going to base it on a existing one. So that's unrelated to the topic of currently tradeable crypto.
Ps2. A bit of regret not thinking about it in March last year. But that's just the greed talking.
The creator of the Keurig, a device which produces amazing amounts of waste, talked about the unintended consequences of his invention and how ashamed he is for the damage his invention has done.
I'm sorry but you have to be very short sighted to call single dose coffee in non-recyclable capsules "unintended" waste.
If Satoshi does something like this with his cold wallets, or Mr. Keurig does the same with his k-cup loot, then we'll think about it.
Though making them unrecyclable is a bit of a question. Obviously it wasn't the intent but it seems a very obvious overlook. I believe (but may be wrong) that the Nespresso, a competitor, has compostable pods.
It's a dumb metric.
This simply tells us that bitcoin has a dumb cost structure. Apparently its inventors didn't think about that either. But that's not our problem. Our problem is measuring efficiency, and for that we need a measure of efficiency. And a measure of efficiency needs to be chosen in terms of how good it is at measuring efficiency, not in terms of how good it is at hiding that a certain payment system has a dumb cost structure.
The car will overheat and won't reach point B if the fan isn't running, so does it make sense to compare the efficiency of different cars based on how many rpm's their radiator fans do?
I can handle a lot of transactions on my personal laptop, but how safe would they be?
I'm not sure if we can that easily pin the responsibility on a single person and not on every single one who still continue to go for PoW while knowing how destructive it is.
Ouch!
>Haber is also considered the "father of chemical warfare" for his years of pioneering work developing and weaponizing chlorine and other poisonous gases during World War I, especially his actions during the Second Battle of Ypres.
but more importantly,
>Nearly 50% of the nitrogen found in human tissues originated from the Haber–Bosch process. Thus, the Haber process serves as the "detonator of the population explosion", enabling the global population to increase from 1.6 billion in 1900 to 7.7 billion by November 2018
Anything past 1.6B is overpopulation, and is driving the holocene extinction, global warming, pollution, etc... all of our big problems scale with population, and removing this natural limitation on our food supply has allowed us to blow the suspension out on all of them
The solutions for the future will be ones that improve technology to allow more to be produced more efficiently. We should look to the future, not “return to monke”.
You can see the carbon footprint from different blockchains on https://coincarboncap.com
I was with you up until this part...this kind of over-dramatization might turn others away. I can think of several genocidal dictators worse than Satoshi Nakamoto. If anything Satoshi is an Alfred Nobel type figure, who invented dynamite. We don't attribute all deaths from explosions to Alfred Nobel, and Satoshi is not guilty of what miners and speculators do.
Satoshi actually made the most efficient decentralized money that can ever exist and prevented more externalities in the world than potentially any human ever will.
Cars monitor energy use through MPG. Datacenters monitor it as well. Why should crypto currencies get a pass?
> Satoshi actually made the most efficient decentralized money that can ever exist and prevented more externalities in the world than potentially any human ever will.
[CITATION NEEDED]
cars spend energy to move. datacenters spend energy to compute things. bitcoin mining doesn't spend energy to process achieve some TPS, it spends energy to achieve certain level of security, so it's security per energy spent that matters, not energy per transaction.
if transactions or number of them are not an input to a bitcoin miner -- if miner will spand the same energy whether it's for 1 or 1 trillion transactions -- then energy per transaction metric is zero signal.
> [CITATION NEEDED]
no, actually, it's an opinion. current financial system and fiat money cause immense externalities: war, corruption, hunger, crime, etc. bitcoin is an incarnation of money where security is expressed in form of energy spent - you no longer need to involve politics or any other human activities to achieve security and so a large incentive for those simply disappears. bitcoin doesn't solve those externalities, but that specific aspect of money is simply no longer contributing.
So? A running car consumes gas even when it's idle. My parents used to measure MPG at every tank refill, which was a combination of miles, idle, braking, etc.
We can certainly take an average of transactions to get a reasonable number for watts/transaction.
> no, actually, it's an opinion.
... which was stated as fact.
Bad extrapolation of analogy, but still - how convenient that you decided to focus on the lower bound. How about the high bound? Can a car go trillions of miles per gallon? Because Bitcoin block can contain trillions of transactions every 10 minutes.
> We can certainly take an average of transactions to get a reasonable number for watts/transaction.
You can, it’s just not useful.
Yes, yes it is. Stating an opinion as if it's fact, again?
The NYGA report on Tether is due today. Tether is completely insolvent, and once the rug is pulled, all of the exchanges are going to realize that all of their "stable" reserves are worthless and they can't pay out what they're storing for customers, and the price will tumble all the way down as there's a run on the pseudo-banks that can't payout.
Or not, what do I know.
Presumably, people can sell all their holdings and withdraw over time.
Given the price volatility of crypto, that sounds absolutely insane to me. Also, I don't think this prevents a run, on the contrary, when everyone hits the sell button and cannot actually exit then panic will ensue.
You know, the whole benefit of being in the USD. The made up rules of society that provide stability in times of crisis.
If you are transferring tokens in and/or converting tokens to cash, I don't believe those transactions would meet the criteria to be covered by FDIC at that point. I might be wrong on that assumption, but FDIC is only deposit insurance, not withdraw insurance, and its under very specific terms.
Coinbase could shut down converting crypto to cash at any time. There is no promise or guarantee that they have to allow cash exchanges or deposits, since they're basically buying and selling crypto on your behalf.
By the FDIC. Of course, FDIC only covers dollar-denominated balances (savings accounts, checking accounts, etc. etc.). Even money-market accounts (very cash-like) are NOT covered by FDIC, which is why money-markets get a wee bit of a bump in %yield.
Coinbase claims they have the BTC insured through some other means. I don't know how to look into those details or how trustworthy it'd be (ex: AIG "insured" a bunch of mortgages through Credit Default Swaps, which ended up being worthless).
But overall, the idea of losing a security through various means (ex: Credit Default Swap "insurance" turns out to be a sham and the mortgage debt is all worthless) is kind of "normal" in terms of financial markets.
Similarly, if all the BTC disappeared it'd be terrible for BTC-holders, but I think people generally understand that those risks exist.
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Look, I think Cryptocoins are stupid at this point (even proof of stake, but that's another thing). And Coinbase's service going in-and-out over the past day or so is clearly a threat (if BTC moves while Coinbase is down, you lose your opportunity to buy-and/or-sell at the prices you want).
But I don't think there's anything shady going on at Coinbase specifically.
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Now if you want to talk about shady business, we can talk Binance, Bitfinex, and Tethers. Plenty of shady things going around in the cryptoworld.
On the day you might think that limit matters, it's not really gonna matter.
We all know it's insolvent. Apparently it doesn't matter.
[1]https://info.uniswap.org/#/pools/0x7858e59e0c01ea06df3af3d20...
The question then becomes what happens tomorrow. Are people going to try to get out of the Tether that they've jumped into today by going to BTC or USD? If they go to BTC, then no problem, the price goes back up (some). If they try to go to cash, BTC keeps dropping. Tether's value doesn't have to crash for the Tether machine to stop running and cause a BTC crash. Though, at some point in the process it would start dropping, and that would then cause a further BTC price drop.
The price of Bitcoin went up, from about $5200 to $11,000. Why? Because with Tether out of the picture, Bitcoin is the next most stable cryptocurrency (at the time, there was not enough DAI or USDC in circulation to absorb all the Tether money, though those "stablecoins" traded at a premium of about $1.06/$0.92 against Tether). If you're in the cryptocurrency ecosystem, it's usually because you don't want to keep any of your wealth in $USD, so when Tether was declared insolvent all of the money there rushed into BTC.
Edit to add: It's part of the cycle of educating society, it'll be painful and costly to those who were left holding the bag - a mob of potentially 100s of millions of people financial aligned hoping they can get more of society convinced of their ideology of Bitcoin's supposed exclusive value.
The same is true for other types of money - a bank does not hold reserves (assets) against all of its deposits (liabilities), but that does not prevent it from operating, or from bank customers understanding bank deposits as “real money”.
To be clear, I’m not very informed about tether, and as a lay person I do find it to be a shocking situation that probably makes sense to label as fraud. I’m just trying to offer some explanation.
Personally I don’t care - let it collapse if they did anything shady, but this zerohedge-esque “broken clock” strategy is extremely amusing.
If you are confident about the long term prospects of an investment, then holding on for longer might just work. I won't be selling any of my Eth or PoS crypto currencies any time soon. It helps that crypto makes up less than 15% of my portfolio.
I don't like active trading a lot, but if I did, then this would be ideal.
Gg for those of you who maxed out credit cards to buy crypto
[0] https://help.coinbase.com/en/coinbase/privacy-and-security/o...
Not an expert in legal and financial matters, but that sounds like it would start a FBI inquiry and even prison-time for all those involved.
Never.
Except that most of the time that means nothing in practice.
Just look at the GME saga and you have customers liquidated, customers not being able to buy, some not even able to sell. And on top of that the CEO of Interactive Brokers setting a target price for the stock.
All this so that few highly leveraged hedge funds can get away from the short squeeze cheaper along with their lender/broker.
People can sue coinbase and any other shady broker as well. If you've lost 10K I doubt you are willing to spend even more to get it back in court be it coinbase, RobinHood or any other exchanger/broker with an army of lawyers.
Still, for all the BS lawyers get, much of it deserving, for every lawyer behind the brokers/investors/funds there are others representing the victims. These are the types of lawsuits that include egos so big that sometimes discovery of emails/communications and the prospects of sitting for depositions result in a resolution, and even change.
It’s funny you mention the army of lawyers, because many of these cases have been consolidated and one 1 Zoom hearing were 141 lawyers…they represented the plaintiffs.
I have not heard any anecdotes about US exchanges not allowing selling/exiting existing positions. In fact, on of the arguments from GMEanon is that disabling buying and keeping selling open drove the price down. There is nothing illegal about a broker disabling entering a new position (buying stock).
Also, people in China would call it "unplug" when exchanges going down. It's a popular meme because people find every time the market crashes those Chinese exchanges would go down as well, thus many people believe they intentionally did that to let oligarchs sell their crypto in back channels first.
(hard to get a site that is up and has a good chart for that rn..)
Was just going to ask what you would recommend to monitor that. In better times, what would be the best resources?
Jump to the 7d view
Posted on HN a while back.
"To be crystal clear: every time you sell Tethers on Kraken, you are forcing Tether Ltd. to pay you in US dollars. If you can manage to sell enough Tethers for USD on Kraken, then Tether Ltd. will run out of dollars and this whole machine — which currently undergirds 70% of all crypto trading flows — will fall apart.
Well-capitalized hedge fund managers may wish to re-read the above paragraph, and ponder its implications."
Sounds like it could be three things:
1) Their USD standard is bunk. If you're on a commodity money - or secondary exchange money - standard then you can only issue as many certs as there are units of that money in your reserves. With the XAU standard, you can't just mint gold certs without gold underlying it. That's not how any of this works!
2) They just FDR'ed their users, and took them off the USD standard but didn't tell them.
3) Less technically: sounds like they're skimming off the USD for themselves and hoping everyone doesn't divest at the same time. This could be either fraud, or it could just be incomitance, ignorance or any other *ance really.
I could see Tether becoming insolvent if/when there is another financial crisis that reveals some of these bonds as junk.
[1] https://www.coindesk.com/tether-first-reserve-composition-re...
If your currency is backed by some kind of non-cash instrument, then what you've actually got is some kind of ETF like structure, not a currency qua exchange currency.
"Last week, New York Attorney General Letitia James announced that iFinex—the parent company of Bitfinex, an exchange, and Tether, a dollar-backed digital token—is under investigation for fraud. At issue is $850 million that disappeared from Bitfinex’s coffers in mid-2018. The funds may have been stolen while in the possession of Crypto Capital, a payments processing company based in Panama. Crypto Capital has also been tied to Quadriga, a Canadian exchange which lost $140 million a few months ago."
https://qz.com/1607657/tether-could-bring-down-bitcoin-after...
Please link to the HN article: https://news.ycombinator.com/item?id=25788409
But otherwise: smart move. :D
There are several days in the last month, according to Tether, with AT LEAST $500M of inflows.
A single $1B of outflows shouldn't tank a market like this by 40%...
The original Bitcoin whitepaper from Satoshi Nakamoto is available here: https://bitcoin.org/bitcoin.pdf
It is titled "Bitcoin: A Peer-to-Peer Electronic Cash System"
So, based just on the title, it's pretty clear that it's original intent was as an electronic payment method.
The first sentence of the abstract is: "A purely peer-to-peer version of electronic cash would allow online payments to be sent directly from one party to another without going through a financial institution"
If you read the rest of the whitepaper it's pretty clear that the original intent was as a mechanism to facilitate payments and transactions.
Clearly, at least one person (the author of the whitepaper!) "desired" Bitcoin as a payment method. They desired it so much, that they went off an invented it!
If that doesn't count as a source indicating what someone "desires" then nothing does.
It depends what kind of market you think it is. The fact is there's no economic fundamental supporting the value of Bitcoin, so it's value is just whatever speculators are willing to pay at any given time.
[0] https://twitter.com/elonmusk/status/1394170030741413888
[1] https://www.cnbc.com/2021/05/16/elon-musk-suggests-tesla-is-...
It’s fascinating stuff to follow — watch the VIX today, a measure of stock market volatility. It’s absolutely soaring already.
https://www.cnn.com/2021/05/19/investing/bitcoin-price-drop-...
Introducing: Server Trouble As A Service. The most efficient way to stop a run on your bank.
Edit: Also: Since most people need USD to get Bitcoin (or other coins), doesn't that mean all cryptocurrencies are inherently gold-backed and rely on the value-store of gold? (Excuse my naive question. Again; I'm a newbie).
It hasn't been about actually using it for years now.
Kinda weird you left that out but mentioned stealing, although I suppose ransomware is top of mind these days.
Are you saying Bitcoin and other cryptocurrencies are inherently gold-backed like the USD?
That was the original intent, but it's been known for years now that cryptocurrencies just don't work for that scenario. As soon as volume grows, transaction times and costs soar to levels that are unsustainable for actual payments. So most cryptocurrencies have since turned into speculative digital commodities, arbitrary items that get value out of being unregulated, transnational, and anonymous or pseudonymous. They allow money to flow internationally outside of the official banking system, untroubled by pesky anti-money-laundering laws or anything protecting investors. Exchanges on the fringes deal with the trouble of converting them back into money and goods... at least as long as governments allow them to do it.
https://www.reddit.com/r/binance/comments/nea291/weekly_bina...
If someone is selling BTC for USD then someone is doing the same in the other direction. From Gameshop saga we do know that USD takes time to travel between different parties, in this case from buyer to coin base and then from coin base to seller. Unless USD payment is instantaneous there will be some form of T + 1 isn’t it? What am I missing here?
https://www.cnn.com/2021/05/19/investing/bitcoin-price-drop-...
"Investigating - We are currently investigating this issue. May 19, 06:12 PDT"
t. anarchists
Which also asks the next question, how much of the price action and volume is automated trading in these platforms?
Not that automated is necessarily good or bad - but how much is a retail interest
In fact I think you could turn that into a partial numerical measure of the crypto market. In a mature market where "cryptocurrenciness" is mostly just a fact of life, they ought to be less correlated as they have independent lives of some sort. (They'll never be completely uncorrelated, of course, since the whole market is correlated to some degree.) Right now it's still enough of a novelty that the mere fact of cryptocurrenciness is a big percentage of the appeal of a given cryptocurrency.
Estimates put 65-75% of BTC mining in China. That just became a pretty shaky foundation.
All cryptocurrencies are basically the same and indistinguishable and fulfill the same needs.
It's not unexpected that they are correlated.
I bought a bunch of BTC back in 2018 on Coinbase and just left it there, I rarely checked it. Fast forward to 2021 and I want to see how my portfolio has grown, only to be told my account was disabled. This was back at the beginning of March. So I contacted them and told them my issue. They sent me instructions on changing passwords, calling my mobile service provider etc. Some ridiculous stuff. I did it all. Only for them to tell me that they have to forward my case to a specialist. 3 weeks later, they come back to me telling me to repeat the same steps as I did before, and I complied, only for them to tell me they are again forwarding it to a specialist. Another 3 weeks later, they tell me to repeat the same steps in addition to taking a photo of myself holding my ID with a sign that says 'For Coinbase verification'. Did that degrading stuff too. Guess what they told me again, oops we are forwarding it to a specialist.
I don't know whether it is automated supported or what but this is absolutely disgusting and there is no name to the emails, just 'Coinbase Support'.
As soon as I regained access all took all my shitcoins and moved them to a wallet for which I have the key.
Centralized exchanges suck, they are completely against the principles of Cryptocurrencies.
I can load the rest of Reddit fine - but that page just loads as a blank white page. I'm guessing its lots of people going there for the discussions...