One example being Algorand which is carbon neutral: https://www.algorand.com/resources/blog/how-algorand-offsets...
Oh and speaking of usage of crypto in China - i wonder how that affects VET / VeChain which is, largely, used by Walmart China to track their wares:
This thing also poses a real threat to SWIFT and anyone trying to put together a successor to SWIFT. The US has been weaponising international currency transfers for a while now, and China would be facing problems controlling capital flows if people could just send money internationally without much consequence. There are good, selfish, reasons for why governments would intervene.
Why would any sane person invest in real estate? You have maintenance costs, property taxes, it's not liquid and you can go years with little growth. Not to mention if your area see's hard economic times (i.e. Detroit), the chance of a rebound is slim.
You also ignore the premise being put forth, that Bitcoin as a currency still isn't ideal. You don't think "long term investment" with currency so much as short to medium term. Like, will bread and milk cost 10x as much next week?
"Stop thinking investment and start thinking survival" might be a good way to put it.
Nassim Taleb disagrees: https://youtu.be/dLOeBSaq-Ps
I bet the CoinGeek conference audience were stunned by his keynote talk because Taleb used to be a supporter.
At the same time, hedging against inflation is hard. The things you suggested come with their own risks.
I think a future in which crypto becomes stable due increased adoption is possible, and in that future it will be a good hedge.
Does that logic applies in China? Are real state or equities a protection from volatility on a self proclaimed communist country? What about South America, Lebanon or Turkey?
The incontestable precious and invaluable wisdom of the hacker news poster who potentially lives on US California or some rich western country on a comfortably fat salary.
Every. single. time.
The CCP is a bunch of unambitious individuals. Everything that causes troubles to the CCP means troubles for Xi and the possibility that his "president for life" title might be revoked, creating room for somebody else to ascend.
From a game theory standpoint it is better to be at the helm of a slightly less relevant organization than being a subordinate of an organization plowing ahead at full steam unrivaled.
This is even more true in politics and NGOs where the monetary compensation is very limited and it's all about the status.
The reason why we have inflation and debt is to keep the value of our currencies stable. IE, if people want to use dollars, the US government can print more dollars to satisfy the demand. (And thus keep the value stable.)
Cryptocurrency's volatile value is a result of its inability to "print money" when more people want to use it.
Remember: Currency is not an investment. A good currency has a stable value over time; otherwise it's very difficult to conduct commerce.
I'm not following. By definition, inflation is what happens when the price of a currency is not stable.
> Remember: Currency is not an investment. A good currency has a stable value over time; otherwise it's very difficult to conduct commerce
Agreed. But in countries with high inflation, such as mine, you will lose money if all your wealth is stored as fiat.
Even fairly high inflation levels of say 7% annually can still be quite stable on a daily or monthly basis which is all you really need. As most people spend most of their paycheck every month and savings aren’t limited to the currency in question.
By comparison crypto coins tend to have much higher daily and monthly variations which isn’t a big deal for savings, but in practice it discourages their use for day to day expenses.
Even without knowing what country you are from, I would bet that inflation is because imports and exports imbalances and nothing to do with "printing too much money".
And anyway, if the problem is storing value, why you don't buy gold or dollars, yens or something like that?
Those are the traditional means and are usually banned or strongly regulated, if the states money is at stake.
That kind of stability is more beneficial to the middle class than any negatives that may come with that level of inflation.
[0] https://www.nytimes.com/2020/09/02/business/australia-recess...
And if you're going to break the guidelines and comment on voting anyway, the very least that you could do is also add some value to the discussion, e.g. add some thoughts/elaboration/support for the points made.
Australia has gone 30 years without recession because we're supplying commodities like iron into the most miraculously productive miracle in all of recorded history, aka mainland China. And because we've got one of the highest rates of net migration in the developed world.
On a per capita basis Australia has had recessions, and it is a stretch to say that our inflation target did anything relative to all the other countries that have inflation targets.
However, bitcoin experiences 10-20% drops against the USD on a regular basis. It looks like this announcement has triggered another one. It's not stable, it's just (a) appreciated over time a lot and (b) is doing better against the USD than, say, the Argentine peso.
> By definition, inflation is what happens when the price of a currency is not stable
Inflation is what happens when the price of goods and services in a currency is not stable. It can be triggered without a change in the money supply by underlying shocks to the real economy (e.g. 70s oil shocks)
Bitcoin claims to guarantee money supply stability, but it cannot guarantee price stability.
That's also the case in countries with low inflation. That's why, in the US, wealthy people don't stuff cash in mattresses, or keep most of their wealth in general bank accounts. They buy stocks, bonds, real estate, ect. This is also why, in the US, investment vehicles like 401ks and IRAs are highly encouraged.
A stable currency would have an inflation rate of 0%. Inflation does not cause currency stability, it decreases the value of the currency.
By definition, its value is changing.
Sure, and if the government had centralized control of all prices, it could mandate that. Since it doesn't (even those that assert that power don't have it in practice), what it seeks to do, as far as stability, is try to acheive low short-term price volatility, and as it turns out, experience shows that low-to-moderate inflation helps with that.
The M1 isn't the measure that matters - but it is a fact that large amounts of money are appearing from somewhere and that is probably the most significant factor in the currency losing value. Price controls are an overreaction, there are easier ways to make the currency more stable.
[0] https://tradingeconomics.com/united-states/money-supply-m1
No it doesn't. M1 also includes demand deposit accounts (checking and savings accounts), among other things that aren't physical currency.
The USD is one of the most stable currencies in the world.
Perhaps that is why countries like Japan are changing the definition of crypto and calling it "virtual assets" instead of "virtual currency".
Bailouts are another benefit. Governments can at will dull or even prevent financial contagion thus preventing another Great Depression.
All this has a cost in the form of inflation until the money is reabsorbed of course but it’s better than economic collapse.
The burden of the proof always lies with the person or the entity trying to sell something.
The government failed to sell QE and bailouts to the population, the government further failed to sell inflation target at 2% to the population.
Had government not failed in selling these concepts we'd not have bitcoin.
Government as always can't sell. Otherwise it won't be government.
I recall a recent vote where someone was elected president by a significant majority running on just this platform.
In any event even if this was true an ambitious organization such as the government can't be satisfied with 52% confidence in its financial planning
As a democracy, there's no alternative to the government working with whatever majority it gets.
The government managed to sell the need for the military industrial complex.
The military is the most popular branch of the Federal Governemnt whereas the Fed and Treasury linger at 50-60% depending on who is in the WH.
50-60% is very low, that's the reason why Bitcoin thrives. If that number was 92-95% then Bitcoin would not exist.
Is it possible to have that number at 92-95% ? Maybe, maybe not...in any event the answer is not attacking bitcoin because even if Bitcoin is destroyed that remaining 50% void will be filled pretty quickly by something else.
In fact the the US government actually made money from the bailout.
> In total, U.S. government economic bailouts related to the global financial crisis had federal outflows (expenditures, loans, and investments) of $633.6 billion and inflows (funds returned to the Treasury as interest, dividends, fees, or stock warrant repurchases) of $754.8 billion, for a net profit of $121 billion.
- https://en.wikipedia.org/wiki/Troubled_Asset_Relief_Program#...
If you are an organization with 6000 nukes, 22T GDP, largest navy and airforce you don't get to cry about "misinformation".
People don't like QE and bailouts. Period. The burden of the proof is always on the person/organization trying to sell something. Always. For sure the public didn't conceive QE or bailouts and didn't try to sell it to the government.
Bitcoin would not exist if QE and bailouts were marketed by master salesmen such as Steve Jobs, Dana White, Don King or David Geffen
We as investors should operate with what is perceived by the population, not textbooks.
Perceptions move the market, and in the case of Bitcoin perception created a market. From 0 to 2 trillions in 10 years.
It’s not like the banks didn’t suffer during 2008. That bailout money was mostly returned with interest. All the government did was extend a lifeline.
In fact some countries, e.g. Kosovo and Montenegro, in the Balkans, use the euro as a de facto domestic currency since 2002, even though they have no agreements with the EU.
Crypto *is* volatile and wasteful compared to any of those.
Behind every dollar is an unspoken promise that the US Marines will evacuate you middle of the night anywhere in the world if shit hits the fan.
Which has been recently proven to be quite an assumption.
However, as an investment, as of right now, there is only a span of a few months where if you bought Bitcoin you would not be in the green right now.
Did people find a useful reason to buy Bitcoin already? Something that creates value, instead of hopping to sell higher for the next sucker?
But it was just a matter of thinking a bit about it. Everybody knows what Bitcoin is useful for: cyber-extortion and evading capital restrictions. There are even good reasons for practicing the last one... With that in mind, BTC still behaves like a bubble, but proving it's actually one depends on a quite laborious process of comparing the volumes and estimating how they will evolve.
There are a lot of different versions of the idea though. A lot of variety exists in crypto now, and very little is deterministic. I don't want to rule out the positive possibilities, and outlawing is broad brush. The PCB grunted at crypto here. We can do
That said, the variety of possibilities also creates danger. Underregulated stable coins, for example, get very sketchy once you reach a certain size. If they keep growing, start embellished with dolaralized interest payments and such.... you now have a rogue banking system issuing its own US dollars. Good luck with that. The scale of fraud, and treacherously borderline fraud can be epic. I don't think we should downplay these.
OTOH, this is true of every part of the financial sector. Lets not pretend the current way the financial sector is structured isn't riddled with the kinds of problems crypto poses.
A country with some clever CB people, even a small one, should be bold and bring crypto into the pax. There's a lot you can do with a designed-4-a-purpose currency, and crypto is a very viable way to do many things. Bitcoin's origins, and much of crypto's present, is secrecy oriented. But, it's actually more natural to design a cryptocurrency for transparency. That's useful in a lot of circumstances.
Take time to understand wtf is going on and regulate, ban or encourage specific things for specific reasons. There's a lot to be gained, not just a lot to be lost. A properly regulated stable coin might be a great idea.
Keynes has made a comeback during the pandemic, and people are relearning war era ideas about controlling inflation. In that context and considering 2021's low interest rates, national savings bonds will probably soon be considered in various places. You don't need crypto to do this, but it does give you more flexibility in how you do it.
I think this isn't emphasized enough. With existing fiat money I have some degree of democratic control over monetary policy. With BTC, critical monetary policy was set by one person and if that monetary policy ever changes it will be decided by a combination of engineers and mining conglomerates.
Given how critical these policies are and how ideologically focused many of the non-speculators are, I am worried about growing systems with disastrous policy consequences.
BTC is at the point where if you don't have time or want to research what it really is, and only want to believe talking heads and authority figures, no one is going to take the time to explain it to you.
Those days are over, people have moved on and are using it for utility, without permission, how they see fit, whether as a currency or store of value.
Nothing can prevent a BTC transfer to anyone, anywhere, and at anytime. That is why China 'banned' it.
I am so tired of people insisting that I simply don't know anything.
The mining curve is monetary policy. For example, a 100% premined coin has very different properties than a coin with a fixed mining rate and no upper bound. The upper bound on the number of bitcoins is consistently pointed at by proponents as a means to prevent inflation. I can imagine no other phrase for this than "monetary policy".
The mining curve is reasonably described as monetary policy, seeing as it has a major impact on the distribution of coins and on inflation, which many crypto advocates worry about very deeply.
The mining curve was defined by Satoshi based on their original implementation. If there was to be a change in the mining curve we would need (1) a new version of the btc codebase that does mining rewards differently and (2) for the miners to swap to this fork. There is no mechanism for me, as a single person, to have a voice in this process except through contributing hash power to my preference. This is an amount of voting power associated with my wealth. That is antidemocratic.
Or do you want to just keep telling my that I am mysteriously ignorant over and over? That'll certainly endear people to the community.
Bitcoin and cryptocurrency es is a bunch of tech bros assuming they can run or set up a better monetary system than everyone else...
...without realizing that transaction media are an extremely powerful political and diplomatic tool, integral to maintaining national security, and will get stomped relatively quickly given enough time for governments to wrap their head around it.
How exactly do you think you could dethrone Bitcoin, overcoming its gigantic first-mover advantage?
I believe BTC could only come down with the rest of that "economy".
In practice this won't happen, because PoS coins don't deliver the same features (security, decentralization, permissionless) or the market doesn't believe they do.
Also the savings with PoS are not passed to the users of the cryptocurrency, but to the stakers, or big holders of the cryptocurrency. How do we even know, that these people will spend the money they make using some more enviromentally friendly way? Maybe they just buy lambos with the money and fly around with private jets.
Mining is quite small amount of the total transacted amount of BTC daily, and people are willing to pay the cost. If you want to replace Bitcoin with some more enviromentally friendly thing, you have to offer the same capabilities (or better). PoS coins fail to deliver this.
>and people are willing to pay the cost.
No they are not. BTC runs on the block reward not on the fees. Without block reward the average Tx fee would be like 150 USD. (Not accounting for the fact that this would significantly drop the number of Tx which would then raise the cost for the rest of the transaction even higher.)
It's been what, 2 or 3 years since decent PoS designs were introduced to the market? The crypto market is still trying to tell the difference between their right foot and a private key. Give it a few more years and eventually the market will settle convincingly on a design it values the most, be it PoW, PoS, or something else.
In the mean time, it's silly imo to say that the market has decided. The crypto space is still a volatile bloodbath of old chains dying and new competitors rising.
Side-chains dont solve the problem no matter how many and how performant they are. On the main-chain the fees need to eventually cover the cost of running the network i.e. the whole energy, hardware and human labor. Currently this is still mostly paid by the block reward (aka paid by inflation). This pays about a quarter million USD every 10 minutes. It doesn't need much common sense to figure out that if the combined fees of all peoples transaction need to result in a quarter million USD every 10 minute then transaction can not be cheap. Bitcoin is currently running on subsidy by its own block reward that pays about as much as google pays for operation.
The average Tx fee is currently a few dollar but a subsidy of about 140 dollar is added form the block reward. Non-PoW based systems have outperformed bitcoin in terms of transaction for years with average Tx fees of less than a cent. Shouldn't this be enough incentivize? Surely it is for thous who actuality want to use the system. The gamblers and maxis will probably hodl their bag forever but once it loses market relevant it will sharply become insecure as well and the whole thing should collapse. Might take another 10 years, who knows but it eventually has to fail. Its like ICE cars vs. EVs it was always just a matter of time but it felt like it took forever.
>How exactly do you think you could dethrone Bitcoin, overcoming its gigantic first-mover advantage?
If you look at the bigger picture BTC loses market share and there is no sign that this will change. The gains are below average so people who only gamble have an incentive to gamble with something else.
That reads like a tautology—they're called "the rich" because they have wealth, so naturally if you look at the distribution of assets most will be in the hands of the rich. One doesn't accumulate assets purely by being rich, however, as many a lottery winner can attest. Barring the occasional (and usually short-lived) windfall, for the most part those who attain wealth do so because they possess certain habits and preferences related to saving and investing. Even if you reset the distribution of wealth those tendencies would remain and bring about a gradual return to the original economic structure.
Do you have any resources or studies to describe this more? I have really struggled to find actually nuanced discussions and unbiased sources for this. It’s all at the extremes of it’s either the worst thing ever to not a problem at all.
I’d also be interested in comparisons to energy usage of say servers that run Facebook, Instagram, YouTube, etc.
Interestingly enough, I had received an ad for this on my LinkedIn or Instagram before I ever clicked your link.
Additional studies [3] have shown that 39% of bitcoin miners are using renewables.
The energy consumption argument has led some to investigate the energy consumption of other assets such as gold with some estimating the energy requirements for gold to be 50x that of mining bitcoin [4].
Whenever energy consumption of other assets are pointed out to be higher than bitcoin the debate then shifts to utility; e.g it’s ok if Y consumes X energy because Y provides Z to society.
Some bitcoin miners are finding interesting way to utilize the heat produced by their mining equipment [5]. And some say that bitcoin mining can help reduce the cost of producing new green energy infrastructure since excess power that would’ve been wasted could be used for bitcoin mining to offset costs.
I agree with you that it is tough to find unbiased info on the subject.
- [1] https://www.researchgate.net/publication/328581842_Bitcoin_e...
- [2] https://cbeci.org/
- [3] https://www.jbs.cam.ac.uk/wp-content/uploads/2021/01/2021-cc...
- [4] https://simon.medium.com/bitcoin-and-pollution-the-definitiv...
- [5] https://braiins.com/blog/green-innovation-in-bitcoin-mining-...
Also, are you suggesting banning all assets whose volatility crosses a certain threshold?
As for energy consumption, does this also apply to Proof of Stake networks?
That's quite a polite way of saying "facilitate tax evasion".
For those who genuinely want decentralised currency, there's so many more efficient options
Like what, NFTs for farts? Near as I can tell, the other main use cases for crypto - smart contracts, supply chain provenance tracking, and securities settlement processing really haven't panned out. Others have pointed out why it's not working as a currency. Literally all we have left is a vehicle for speculation.
I don't clearly see what you would actually propose banning. My opinion is it's technology, an idea, and that shouldn't be banned.
I find it amusing how casually you just made up a statistic and used it as justification to ban something. Here's an actual statistic: 100% of people who held Bitcoin for longer than 4 years are up on their investment.
edit: Lots of downvotes for an easily verifiable fact. Anyone can look at the BTC chart and see that there is no 4 year span where the price ends up lower than it was at the start.
Just imagine everybody in the world buys as much Bitcoin as they can afford, immediately.
How much richer are we all, in aggregate, at the end of the day?
Millions can be wrong for decades. If history teaches anything is has to be this.
BTW the chip shortage has nothing todo with mining, but if you believe that lie Nvidia and AMD tells you since 5 years...well then that's to bad.
Needless to say that its also technically impossible to ban crypto. Its like banning torrents or even harder and we all know torrent was attacked heavily in the past but it did not go away.
Banning crypto in a practical sense is actually quite easy. Prohibit any business and any bank in dealing with them. If you cannot do legal transactions with e.g. Bitcoins any more, the market mostly dries up. It is not necessary to ban any single coin in existance, but its wide-scale usage in the normal economy.
By the way, there was never an attempt to ban torrents itself. That would have been reasonably easy on a protocol level. It was about banning illegal torrents. As in the content, not the protocol.
The hardcore crypto types would carry on using it but like 95% would give up - that's sufficient.
Another use is tax evasion and money laundering.
Why is crypto any better than cash if users are forced to deal in person? I understand the argument of not having to carry around a duffel bag that could be seized. But nations can disrupt crypto markets on a global scale.
At the very least, they can make it difficult to exchange for actual, usable, local currency. Which appears to be what China is poised to do.
Odds are that, given fiat to launder, or crypto that needs to be converted to fiat that still needs to be laundered, they would cut the useless step.
The only illegal industry that would still see the use for it is maybe ransomware, but ransomware is not a cyclic business, so it would be surprising that they'd find enough individuals on the street to convert their millions easily.
No one wants to ban crypto. The goal is to ban financial institutions that handle fiat from trading with institutions that handle crypto.
From there, if people want to accept funny money as payment for pizzas, it's up to them really.
All black markets have an incentive to use it - including state actors (e.g. weapons deals). Getting caught laundering Monero is preferable to getting caught selling missiles to the Saudis.
https://kotaku.com/ps4-crypto-warehouse-was-actually-farming...
Additionally, some individuals steal electricity (eg. from their workplace, or if they have electricity included in their rental contract). Cryptocurrencies have thus conveniently enabled a form of electricity theft and fraud previously impossible for the individual.
Steel manufacturing requires tons of electricity, and it is already impossible in EU without enormous subsidies. It's an industry surviving entirely on life support.
You can bribe enemy army staff with it.
But seriously, just how much is too much when it comes to steel subsidies, and just how much EU can tolerate its steel industry failing so hard to upgrade?
Rather than subsidising, say, buying new, more efficient blast furnaces EU countries basically just spend few hundred dollars extra of taxpayer money per ton of steel.
Just because one crypto currency is like that doesn't mean there cannot be another decentralized crypto currency that is better.
Just because your or mine imagination does not reach there doesn't mean there can't be somebody that can figure it out.
I don't fly in airplanes but I use crypto. So why should you get to choose to do some activities that blast CO2 directly into the atmosphere but I can't? It is a disgusting, authoritarian ideology you have.
Besides that crypto can run on solar. Airplanes cannot. So I propose we ban airplanes. /s
The reality is you just don't like the politics behind the crypto movement. The climate is just a convenient bludgeon for you.
Isn't this whataboutism? A is not so bad because you know, B does it too.
(Save the “it’s not really that bad” arguments, I’ve heard all the industry’s gaslighting, but their claims don’t match reality)
What you can do is use and support the climate friendlier alternatives. There are crypto currencies created with that in mimd
I am encouraged to see the transition to PoS and would love to see PoS overtake PoW, just from a bystander-concerned-about-the-environment perspective.
PoW by now is basically PoS with extra steps
But, even for the environment, I can't take people thinking it is a good idea govs using PoW, or standard exchange problems, to ban All crypto-currencies. While creating their own fake digital coin
PoS is also not ideal since it keeps promoting the same rules has the old system. Who has more money will keep having more independent if their producing something useful
So I think we still need something new, and someone smart to come up with it
Something that works for big groups, like a combination of localized PoW plus global PoS with PoT. Proof of trust, like most systems work
You make money when you exit and sell the asset for cash. Have they sold ?
When you can buy food, house/rent and the doctor accepts bitcoins it will become cash.
As to why >100% transparency is a desirable property, see recent regime changes and imagine how easy it would be to persecute the friends of the old regime by simply looking at their purchase history.
Edit:
As long as you can use something - be it a coin, a bill, a SWIFT transfer, a blockchain transaction or a Nuka-Cola bottle cap - to pay someone for something, and a third party would be able to identify it as a purchase, same things will happen. A criminal will be able to take your purchasing power and use it themselves. A taxman will be able to collect a percentage of your trade, and men with guns will take you in front of a judge if you refuse.
The manifestation of value doesn't matter, because money isn't a thing, it's a shared belief.
A blockchain based currency will exist as long as there's someone with a sufficiently powerful computing device connected to a sufficiently low-risk network that can be accessed legally or illicitly. A blockchain wallet will exist and be yours alone as long as you keep the password in your brain, never write it down, and resist attempts to extract it from you.
This means that, in comparison to conventional currency (including Nuka-Cola caps), a blockchain economy is much easier to operate undercover when it's outlawed.
> a system where TPTB get to fudge the books as they see fit
This depends on whether the media are in to the party or not but when they are this is mostly true.
> impose taxes via intentional inflation
This is a fact in those countries which have control over their own currency.
> and keep tabs on your every transaction
This is a fact and one of the driving forces behind the "cashless society".
2) The expansion of the money supply is not necessarily inflationary.
3) Inflation is very different from taxation: if you hold cash you’re supposed to circulate it, either by spending it or by investing it. Inflation disincentivizes cash-hoarding, and also deflated the value of any debt you might have.
2) ...but it generally is just that, inflationary. The fact that there can be exceptions to the rule does not make the rule less valid.
3) ...and inflation is also used by governments to provide funds (by "printing money" in some way or other, the actual implementation depends on how the currency is regulated) which otherwise would be provided through taxation, leading to inflation and as such reducing tax payer's purchasing power - just like taxation does.
2) it's not an exception to the rule at all. The rule for inflation doesn't mention how much money exists, it only mentions how much money circulates. More money existing does not necessarily mean more money circulating (eg.: money tends to concentrate in certain places for various reasons, rather than diffusing freely).
3) Sure, but two things that have similar features are not always similar in essence or nature. Swords and needles are both sharp, but you wouldn't argue that they're essentially the same. In fact in your own example, taxation for certain purposes could be either inflationary or deflationary (eg.: austerity measures, including those that involve taxation, are deflationary by design).
Why is that interesting? Because popular sentiment (in the comments) on HN is very frequently wrong. HN is a tremendous resource for contrarian purposes.
Every watt of renewable power generated to power a crypto miner, is a watt not being used to reduce the use of non-renewables in the wider energy grid.
I don’t care if your crypto gear is hooked up to a dedicated hydro plant, I care that the hydroplant is not connected to the wider grid and shutting down gas fired power stations.
Yes, that is true...
> which he would rather was not invested in renewable energy
...no, he would have used the generated electricity for something more useful, NOT make it so that it isn't generated in the first place.
https://arstechnica.com/tech-policy/2021/09/old-coal-plant-i...
Its not unique either. There’s a company in the U.K. that bought an old coal plant, to convert to gas operators, to provide power solely for a crypto mining operation.
Simple fact of the matter is that it currently cheaper and easier for miners to use fossil fuels, then build renewables. Which is exactly what they’re doing.
No, he's not.
> meanwhile his plan crashes the price of renewable energy endangering those industries and shrinking the market.. allowing established fossil fuel industries a bigger share
It seems that you have completely missed the past four decades of renewable energy decreasing in price by a factor of 100x. The result of this decrease was not "endangering those industries", but rather making them viable in the first place and broadening the market massively. As per Jevons, the energy market doesn't shrink when prices get lower.
I'm puzzled as to how someone could make such a glaringly obvious mistake.
And it seems you have completely missed the fact that investment from crypto miners helped to bring this efficiency saving about, if there wasn't so much demand, there would be nothing to invest in R&D and infrastructure that inevitably lower prices.
Crypto, or specifically PoW acts like a guarantee of sale under a certain price per KwH. It used to be necessary for governments to guarantee power prices, and offer subsidies to encourage investment in their countries infrastructure. PoW in part replaces this necessity and encourages companies to invest in renewable, efficient, power production.
Btw. we have truck driver and plumber shortages.
Bitcoin makes use of energy that would otherwise be unused.
All that means is that in almost all scenarios bitcoin mining will be directly causing an increase usage of non-renewable energy. There are of course certain times and places where this doesn’t hold true and there’s a genuine surplus of renewable power that can’t be stored. But that’s an exception not the rule. Try and tell me with a straight face that the majority of power consumed by crypto is surplus renewable energy.
Only from the view of the universe, not from the view of humans. It cost less energy to drill for oil than the energy you get out of the gasoline. It takes less energy to create a solar panel than what you can get out of it. It takes less energy to labor at the factory for an hour than the energy you get from the 150KwH of power you can buy for your house from that hour of motion you performed at the factory.
If I use some electricity to run PoW on an electronic litecoin transaction from me to my friend in Kenya, that's a hell of a lot lower energy than building and operating a Western Union in Kenya isn't it?
On an aggregated pre transaction basis we know this isn’t true. Crypto is not more energy efficient than existing financial infrastructure. Additionally you’re comparing a small part of a financial transactions (I.e. and database update) to a complete end-to-end transaction, including turning those digital funds into spendable cash.
Unless you friend in Kenya is also capable of spending that crypto, without turning it into fiat, then example is meaningless, because your ignoring all the infrastructure need to do that fiat conversion.
Additionally Kenya has digital banking infrastructure. Send a SEPA payment instead, no need to Western Union.
Crypto can be spendable cash. You can buy a coffee or a bar of gold with it, even bullets. Sounds like it can be used as a currency to me. It only takes a willing counterparty.
> Crypto is not more energy efficient than existing financial infrastructure.
That depends on the place and circumstance. I concede that Kenya was a poor example and I should have used someplace like Central African Republic instead.
>Additionally Kenya has digital banking infrastructure. Send a SEPA payment instead, no need to Western Union.
Assuming you are one of the one third of Kenyans who have a bank account. And assuming the one sending the money has a bank account. Both of which involve documentation and KYC, something not necessary in most crypto transactions.
>because your ignoring all the infrastructure need to do that fiat conversion
Not really, crypto to fiat can be done informally. There's several people in my city who buy and sell it and all they need is a cellphone and local currency.
It's only from the perspective of someone that thinks like a loser, always trying to find something wrong, that you can find zero uses where using crypto is more energy efficient than other financial options. And not all cryptos use the same energy or transaction cost as others.
For an example of transaction efficiency, I can buy a bar of gold from some established bullion vendors in litecoin much cheaper than with a visa card due to lower transaction risks for the merchant and lower transaction fees. If you can't wait multiple days for an ACH transaction and have to buy precious metals online, crypto is actually the cheapest way in the US.
All true, but the same also applies to chickens, screwdrivers, oranges, dogs, cats etc. Just because you can barter with something doesn’t make it a currency.
Currencies are better identified by their fungibility (which crypto has), their value stability (which crypto currently doesn’t), and their wide acceptance for use in everyday transaction (also not true of crypto in the vast majority of the world).
> It's only from the perspective of someone that thinks like a loser, always trying to find something wrong, that you can find zero uses where using crypto is more energy efficient than other financial options. And not all cryptos use the same energy or transaction cost as others.
I’ll remind you of the guidelines, as you’ve clearly forgotten them.
> Be kind. Don't be snarky. Have curious conversation; don't cross-examine. Please don't fulminate. Please don't sneer, including at the rest of the community.
Ad hominem attacks undermine your arguments and suggest that you don’t actually have very strong argument, instead you’re forced to attack the character of the person your discussing with, due to an inability to attack their argument. Try harder.
I used be a fan of crypto, did plenty of trading, bought plenty of pizza etc with it. When to meetups, evangelised crypto to friends and family. Back then it looked realistic that crypto could be a genuine currency, and the concept of DAG was incredibly.
Unfortunately crypto has descended into little more than get rich quick schemes that take advantage of naïve investors, or produce profit by externalising all of the negative consequences of crypto mining (such as CO2 emissions). Forcing the rest of us to bear that long term cost, for a grifters short term profit.
I admit there are coins out there that potential address these issues, and still possibly have a future as a genuinely useful currency. One not manipulated by a small number of extremely large coin holders. But unfortunately that doesn’t change the damage caused by other coins.
> For an example of transaction efficiency, I can buy a bar of gold from some established bullion vendors in litecoin much cheaper than with a visa card due to lower transaction risks for the merchant and lower transaction fees. If you can't wait multiple days for an ACH transaction and have to buy precious metals online, crypto is actually the cheapest way in the US.
This is just an example of how slow and backwards the US financial system is. Most other countries have far quicker and cheaper payment rails. Here in the U.K. I can send an instant Faster Payment for free from my bank account, and the money moves faster than the app UI (I get a push notification from the receiving bank, before the UI in my banks app has had time to display the confirmation). The whole of Europe has similar payment systems that also work cross border.
The money moves so fast that when trading crypto the slowest part of buying or selling was always the confirmations. The fiat part was instant.
I did attack your arguments, including many other points and I never called you a loser. Quit being so defensive. I said those who continually look for ways to make something not work, rather than finding the ways they do, think like losers. And I back that 100%! The only of the two of us who had made an ad hominem against the other is you, by saying I have an "inability to attack their (your) argument." Thanks hypocrite!
>Unfortunately crypto has descended into little more than get rich quick schemes that take advantage of naïve investors, or produce profit by externalising all of the negative consequences of crypto mining (such as CO2 emissions). Forcing the rest of us to bear that long term cost, for a grifters short term profit.
I'm not a fan of stable coins, but how many people you reckon are buying DAI or USDT with the idea of striking it rich? I hear this sad sad false diatribe over and over, completely ignoring that crypto-currencies are currencies and not investment, with people getting mad that crypto is not an investment that is going to provide returns for naive "investors." And then they go on to attack crypto for not living up to being an investment!
>I used be a fan of crypto, did plenty of trading, bought plenty of pizza etc with it. When to meetups, evangelised crypto to friends and family. Back then it looked realistic that crypto could be a genuine currency, and the concept of DAG was incredibly.
So you were a dogmatist for, and then apparently now a dogmatist against. Try being a neutral pragmatist that doesn't believe crypto is an investment utility but rather one possible financial engine that allows electronic transactions without KYC or centralized authority.
Re-read my comment, that’s not what I said. It’s difficult to have a discussion with someone who selectively quotes text, and deliberately ignores the wider context.
> I'm not a fan of stable coins, but how many people you reckon are buying DAI or USDT with the idea of striking it rich?
One of the original stated goals of USDT was to provide an on-ramp to other crypto, and do an end run around KYC and AML laws. People don’t buy these coins to get rich, they buy them to either purchase other coins, or to temporarily insulate themselves from crypto volatility, without having to resort to fiat. Additionally the fundamentals to USDT have been called in to question may times, with plenty of evidence that whole things scam and someone’s stolen the backing fiat.
> Try being a neutral pragmatist that doesn't believe crypto is an investment utility but rather one possible financial engine that allows electronic transactions without KYC or centralized authority.
I’m not sure how you’ve ended up deciding that you think I treat crypto as an investment, not a currency, after I’ve explicitly said the opposite.
As I said I believed that crypto could be a very interesting and useful currency, unfortunately it’s not panned out that way. Saying we should treat crypto like a currency when it doesn’t behave like one, and when most people don’t treat it like one, is hardly pragmatic. A more pragmatic approach is to observe how others are using it, observe how it behaves, and treat it like that. If it looks like an value gaining asset, and people treat it like a value gaining asset, then it’s a value gaining asset. Not a currency.
To cover your eyes and ignore the reality of the situation is just foolish. It certainly does nothing to advance the cause of crypto being a currency.
>If it looks like an value gaining asset, and people treat it like a value gaining asset, then it’s a value gaining asset. Not a currency.
>I’m not sure how you’ve ended up deciding that you think I treat crypto as an investment, not a currency, after I’ve explicitly said the opposite.
Again you go on contradicting yourself whenever you find it convenient. You are possibly the most disingenuous, contradictory, hypocritical person I've met on HN. Fine to waste 'watts' on social media news sites but not to send a payment to your unbanked cousin in El Salvador. Have fun thinking like a person who only looks for ways to fail, rather than ways to succeed.
Not a biblical person myself, but I'm going to take a note out of the bible on this one : " Answer not a fool according to his folly, lest you be like him yourself."
Have a good one.
One comment on HN, probably around 100mWh.
One is not like the other. But please continue to pretend otherwise.
> Again you go on contradicting yourself whenever you find it convenient.
Please be explicit and show we’re I’ve contradicted myself. I don’t believe I have, but happy to be proven otherwise.
> Not a biblical person myself, but I'm going to take a note out of the bible on this one : " Answer not a fool according to his folly, lest you be like him yourself."
You make a good point. Why have I bothered to talk to someone who is so clearly disconnected from reality.
For keeping track of a ledger that one dude in a basement with an Excel spreadsheet could keep track of, more or less.
That's completely irrelevant for the correlation. Renewables are theta-bound by fossil fuels, and fossil fuels are theta-bound by renewables. Only at zero emissions for a source this would stop being true. This is first semester math.
There are plenty of crypto operations that have their own, renewable power sources that operate in a closed zero emission fashion.
If you mean operational emissions, then this is a trivial statement. If you mean total emissions, then this is a wrong statement, unless these people manufactured their own generators using zero emissions in the process.
If base load were to drop due to crypto miners being turned off, the energy with highest marginal cost would be turned off, which means fossil fuels, not renewables.
Energy is fungible.
> If we were serious about fixing climate change we'd stop all air traffic tomorrow.
The fashion industry alone has more climate impact than air traffic and maritime traffic together. Aviation contributes around 1% of air pollution (though 5% of greenhouse effect, due to high altitudes).
But all of those (transport, fashion) provide utility. BTC usurps nearly 1% of world electricity without providing commensurate discernible utility.
I for one think not having to pay 20% for a remmitance for someone who is trying to help their famiy in another country has huge utility, maybe others disagree.
Network shares the load but winner takes it all, i thought.
You can try to go it alone but your chances of finding the block reward are incomprehensibly low.
No, for protecting against the untrustworthiness of that one guy in his basement. You may disagree with the value of that function, but that's what cryptocurrency provides.
Also a huge portion of the energy used by bitcoin would otherwise be wasted.
Also your figures are egregiously off and taken from flawed estimates
https://nydig.com/wp-content/uploads/2021/09/NYDIG-Bitcoin-N...
Sure, measure energy use per amount of money transferred. That's not going to be very nice either.
> Also a huge portion of the energy used by bitcoin would otherwise be wasted.
Oh, come on. Now you're just trolling. It would have been used for something else that most likely wouldn't be waste, like in factories or in hospitals and such.
I am well aware of the difference between average and marginal energy use. This would be particularly relevant if the blocks were not full, but mined anyway, so that any additional transaction could've been included "for free". However, more often than not, that's not the case, but the mempool is non-empty, and the constraint (of max transactions per block) is binding. [1]
Thus, one can not trivially argue that the marginal cost of a transaction is zero.
Next, yes, my figures (165 TWh/a = 19 GW) from Digiconomist [2]) are at the upper end of the estimates, but other figures (eg Cambridge Bitcoin Electricity Consumption Index) estimate 100 TWh/a, with reasonable bounds of 36 to 376 TWh/a, so 12 to 28 GW, so are largely in alignment, modulo a factor of 2. (Note that your source is also within a factor of 3 of those estimates, pegging BTC at 0.2% of global electricity consumption.)
At any rate, the average cost is just preposterous, even if off by a factor of 3.
[1] see for example https://jochen-hoenicke.de/queue/#BTC,1w,count
Probably because heads of state like to print it to solve their short term problems essentially robbing everyone with an inflation tax. I dont call that stable or just. I work and save and expect my currency to hold up and not be abused which is not happening currently.
Edit: HN must be the worst platform in existence to debate. I have about 700 karma and cant comment more than 3 times on this thread. Your rules are not helping discussion or clearing clutter, they're just really annoying. Retrac: no ive hit a limit and cant respond anymore on the whole thread even with only a few comments.
That's funny. The extant fiat currencies haven't failed. So, the only ones that have failed... are the failed ones. And those have failed, 100%, indeed.
Thus, not every currency has failed, although it could be argued that they still exist in a 'shadow' form, thus have not yet existed to the end of the infinite timeline.
Either way every failed currency has indeed failed, thus every currency in the future that fails will also be considered to be a failure, maintaining the 100% record for failure.
I'm curious about what leads you to claim that gold is "a private currency". Can you elaborate on the rationale behind your claim?
Anyway. There's a cute video out there I can't find now of a man trying to use gold in New York to buy something. Anything. The results indicate its use as a currency was questionable. (No one would accept it as payment.)
I don't agree with the sentiment of the parent either, but:
* Assume the best interpretation of a comment [1].
* Keep it on topic
* Don't attack the person, also not implicitly (e.g. "please educate yourself", don't say that)
Reread: https://news.ycombinator.com/newsguidelines.html
One can claim many things about the parent comment. But it's all directed to the topic at hand.
Cheers!
[1] The best interpretation I can come up with is: yes the energy issue with crypto/bitcoin are an actual problem to solve. Yes, using crypto might be a good use-case in certain situations. While I don't believe the profit claim (there's no source), I can't disprove it either. So it poses an interesting question as to whether that's true.