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Comment by donatj | Hacker News Reader

> doing nothing of any practical value while greatly helping out with destroying our planet

Serious question, where does this line of thinking end? Gaming rigs use upwards of a thousand watts, no practical value in gaming. Watching sitcoms on a television has no practical value. Phones capable of doing things other than making calls have no practical value, but we charge them all the time.

Honestly I think providing an alternative financial system is more practical than most of the other energy intensive things we do these days.

The idea that we should do less stuff and be miserable because climate change is fatalist and just silly. We should be building nuclear power plants at a drastic rate to meet supply.

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>>Gaming rigs use upwards of a thousand watts, no practical value in gaming.

Humans have been playing games literally for thousands of years - there is a value in entertainment, especially with our busy lives of 21st century.

You can of course overdo it, turn it into an addiction and it can destroy your life - like many other things.

Crypto trading is as valuable as trading scraps of paper with a dollar sign scribbled on it - if it were done for fun or entertainment, then sure, whatever, but it's having major impact on our energy consumption and has to be curbed.

PS - also, a small side note - literally no gaming rig uses an "upwards of a thousands watts". Even fitted with the highest rated components currently available on the market(say a 12th gen i9 + RTX3090) you won't be using 1000W of power. Consoles use about 200-300W under full load, and that's a bigger gaming market than PC. And then the biggest gaming market is mobile - larger than PC and consoles combined, and the energy consumption there is tiny. So you're massively off base here.

>>Honestly I think providing an alternative financial system is more practical than most of the other energy intensive things we do these days.

And I honestly think that anyone who thinks crypto will become "an alternative financial system" and not just a pyramid scheme is lying to themselves.

It's true - crypto is bullshit. I've had a hard time shaking the realization that money is bullshit too.

I think there's a fundamental issue here that prevents us from reaching an understanding.

ANYTHING can be used as money. The systems that we currently have in place have lots of big problems, but "we" decided to use them and that's why they are popular. We could also decide to use a cryptocurrency as money, and it would be equally valid, and it would become our "money" - that bit is fine and I'm not arguing with it.

What I am commenting on, and what I am calling bullshit, is the cold hard reality of crypto - there hasn't been a coin invented yet that is anything but a ponzi scheme. Everything from bitcoin to ETH to dogecoin is just a scam to make some people rich, even if it started with good intentions(and I believe Bitcoin really was started with the intention to become a currency).

The second this changes, and we have a cryptocurrency that is actually used as money and not a plaything, I'll happily stop complaining about it.

I hold a decent chunk of change in stable coins most of which I lend out to earn interest. Sometimes I top up a VISA card with those stables and then buy groceries.

You might reply "you're just using a proxy of USD the original currency, its not new".

That's true my reply to that would be:

Having the USD be on chain allows very efficient lending. For eg. I can use a lending aggregator that is constantly polling many lending sources and moves my money to the best source of yield regularly. How would you do this with traditional banking?

I expect over time for the volatility to smooth out as more of the expectations are realised and we figure out a widely agreed fair price for most cryptos (for many this will be zero).

Yes, efficiency matters, permissionlessness matters. Future us will be talking about today as the early days of robotic money.

Yield is meaningless without knowing risk. What is the expected default rate under adverse economic conditions? Are borrower credit ratings available from independent sources? What is the counterparty risk for the lending aggregators and sources?

Chasing yield is a recipe for disaster.

> Yield is meaningless without knowing risk. What is the expected default rate under adverse economic conditions? Are borrower credit ratings available from independent sources? What is the counterparty risk for the lending aggregators and sources?

100% agree, I hope my comment didn't paint it as if there is no risk. In terms of default, virtually all borrow lend dApps currently are overcollatoralized so if the borrower defaults, they are liquidated and I will be made whole.

> Chasing yield is a recipe for disaster.

Kind of a bizarre and baseless statement? Why should people not earn yield on their capital? We are all constantly losing purchasing power to inflation, it makes absolute sense to earn yield to negate this.

> use a lending aggregator that is constantly polling many lending sources and moves my money to the best source of yield regularly

If you live somewhere where cryptocurrency gains are taxed as income, how do you handle the reporting of this at tax time? It seems like it would be tedious to keep track of every transaction across multiple defi platforms.

> If you live somewhere where cryptocurrency gains are taxed as income, how do you handle the reporting of this at tax time? It seems like it would be tedious to keep track of every transaction across multiple defi platforms.

It's so country by country right now due to how early we are. Tax rules will be more clearly defined assuming Web3 and DeFi continue to be adopted over time.

> The second this changes, and we have a cryptocurrency that is actually used as money and not a plaything, I'll happily stop complaining about it.

I won't: we still have proof-of-work to get rid of (and generally, the unreasonable energy consumption and chip usage).

Is there any other unreasonable use of energy consumption than proof of work? Solana (using proof of stake) uses similar energy as hosting a website. If this tiny energy usage is also problematic then we would need to start also shaming people for uploading Youtube videos or scrolling through Instagram.

If this low energy consumption confirms itself at scale, that will be a huge progress. Possibly not quite there (there’s still the Ponzi problem to contend with), but at least that’d get rid of most of the externalities.

Now we need to nuke the Bitcoin farms. (Half serious: I wonder whether launching tactical nukes on those farms would generate less pollution in the long term than letting those farms be.)

Humans have also been gambling for thousands of years (which is just playing games with the added component of money on the line), so by this logic there's value in it too. I would also be interested to see the worldwide energy consumption of all gaming devices in comparison to the worldwide energy consumption of all crypto mining, especially now that many have moved to proof of stake.

Considering the explosion in the gaming industry in recent years you may find that it outpaces crypto already, or is catching up very fast.

> especially now that many have moved to proof of stake.

For tiny values of many.

There is no major cryptocurrency using anything other than PoW. Ethereum has plans to start moving to PoS in 2022, but isn't there yet.

And related to gaming: Bitcoin alone consumes more power than entire European countries - including all the gaming, smelting, heating, industry, finance, data centers etc in those countries. There is no chance in hell gaming alone, for the entire world, is consuming more power than even Bitcoin - not to mention comparing it to all crypto combined.

> Bitcoin alone consumes more power than entire European countries - including all the gaming, smelting, heating, industry, finance, data centers etc in those countries.

EU nations may be a poor comparison, as it has many tiny nations as members as well as a few big ones.

The first Google hit I got said Bitcoin uses 80 TWh/year which puts it around Belgium (9th in EU) for pure electricity, the second said Bitcoin was using about 177 TWh/year (bit more than Poland, 5th in EU, again just for electricity).

I don’t have exact figures for game consoles or power usage per console or gaming PCs, so I will do a Fermi estimate: 1 billion active gaming devices (PCs and all consoles combined), 200 W per device, each used for 3 hours per day. This is 219 TWh/year. As a Fermi estimate, take with a grain of salt.

(I don’t accept the general claim that BTC actually has real value; conversely I think most gaming does, including gambling although for gambling the value is much less than the cost, but that’s not the focus of this comment).

1 billion devices each consuming 200W for 3h every day is waaaay over estimated. The PS4 has sold 115 million devices over its entire lifetime (2013-now), being the most popular modern console; and it consumes closer to 150W while gaming. Consoles are famously more popular than gaming PCs, so the total amount of high-power gaming devices is probably much closer to 300million than 1 billion.

So, let's say 300 million devices, running 3h/day at 150W, that's closer to 50TWh/year, less than even your smaller estimate for Bitcoin.

Perhaps, perhaps not, this is an explicit limit of Femi estimates.

But you do also have to include the power cost of displays when the game machine doesn’t have one built in, adding 10-120W.

And the older consoles didn’t all vanish into the ether when new models arrived; my brother still has an original Xbox 360, and not for lack of money to upgrade. So I expect many of its contemporaries to also contribute to the total number of gaming units, not just total sales of most recent Xbox + most recent PlayStation + most recent Nintendo console.

> There is no major cryptocurrency using anything other than PoW

7 of the 10 largest chains use PoS.

By volume traded per day, there really are only two major cryptocurrency chains: Bitcoin and Ethereum. Both are PoW. As near as I can tell, the 3rd largest blockchain by volume is XRP and its an order of magnitude smaller than BTC or ETH.

Volume traded is admittedly an imperfect measure of activity, but its better than market cap.

Solana and Avalanche both process more transaction activity than Ethereum (and way more than Bitcoin).

And that’s not “fake activity” by any means. Both chains run essentially the same DeFi and NFT activity as Ethereum.

> Humans have been playing games literally for thousands of years - there is a value in entertainment, especially with our busy lives of 21st century.

Who gets to decide that? You see value in entertainment derived from a gaming rig, a person in Argentina sees value in mining a unit of make-believe currency which they can then sell on a speculative market. Should we form a global committee to decide on which types of computation have value, and should therefore be allowed to execute?

Having a committee decide what’s allowed is generally how law is made, and the need for such committees is that what’s good for any individual is often different for what’s good for groups of people even though the latter contains the former (tragedy of the commons, prisoner’s dilemma) so: yes.

Gaming and TV shows use a fraction of the energy to bring joy to far more people. Even if your enjoyment comes from watching numbers go up so you can get rich quick, it's literally burning through power and advanced components to do it at a rate like nothing else ever conceived. And it achieves basically nothing. Crypto is currently useless at doing anything other than making some people rich.

So entertainment matters more than censorship-resistance and self-sovereignty.

Remind me what did Wikileaks resort to using after it got banned from all payment networks?

Your argument is completely valid against Ethereum and Bitcoin, I hope they will be used less to reduce the energy used by crypto. However the vast majority of others use Proof of Stake and a fraction of the energy. Take Solana, currently the 5th largest by MCAP, a tx uses a similar amount of energy as two Google searches. I am pointing this out as I see often the whole crypto market lumped together but crypto networks are not all created equally. Some are 10 years old and others are 2 years with vastly different implementations.

> https://solana.com/news/solana-energy-usage-report-november-...

> Honestly I think providing an alternative financial system is more practical than most of the other energy intensive things we do these days.

About 25 % of energy expended today is to make people not freeze, which is the single biggest or second biggest energy consumer world wide. The other one is transporting stuff and people. The third one is making stuff (food, buildings etc. use a lot of energy).

> Serious question, where does this line of thinking end? Gaming rigs use upwards of a thousand watts, no practical value in gaming. Watching sitcoms on a television has no practical value. Phones capable of doing things other than making calls have no practical value, but we charge them all the time.

All of those things have practical value. Humans need relaxation and entertainment in order to be productive, which gaming and sitcoms provide. (I'm not going to explain how smartphones have practical value because I assume that was included due to some sort of editing buffer mix up or similar while you were simultaneously writing something else while commenting here).

> Honestly I think providing an alternative financial system is more practical than most of the other energy intensive things we do these days.

That can be done for orders of magnitude less energy. The high energy use of Bitcoin and similar is not due to its providing a financial system aspect. It is due to the particular implementation details of its ledger.

No, the problem with the line of thinking is not that gaming has no practical value, it is that some people think gaming has no practical value.

Our other uses (which may need to be curtailed, not arguing for or against that here) have comparatively fixed costs. Proof of work inherently increases energy consumption to keep difficulty up.

Yeah, people should pay for their externalities. Currently, emissions are not priced and everybody who is using a lot of power is stealing quality of life from future generations and the global poor. BTC mining is just one of those operations that is resistant to a carbon tax since the price of BTC and therefore the mining rewards can just rise to compensate.

> BTC mining is just one of those operations that is resistant to a carbon tax since the price of BTC and therefore the mining rewards can just rise to compensate.

But if it's still taxed proportionally to the generated emissions, does it matter how big the rewards are?

> BTC mining is just one of those operations that is resistant to a carbon tax since the price of BTC and therefore the mining rewards can just rise to compensate.

I don't follow your logic, could you elaborate? One could say that about other things subject to carbon tax. Like all goods and services, the price is set by how much people are will to pay for it.

"the price people are willing to pay for short-haul flights could just increase, and therefore the airline profits are unaffected." "the price people are willing to pay for aluminium could just increase, and therefore the smelters are unaffected."

They don't really make sense. Carbon taxing would change miner behaviour, because greener energy would be more attractive (by virtue of being cheaper, especially with carbon taxing and reduced fossil fuel subsidies).

>“Serious question, where does this line of thinking end?”

It ends at the last pyramid scheme.

That line doesn't mean anything - should we make any type of computation that contributes to a pyramid scheme illegal? How do you even define a pyramid scheme in a way that doesn't also cover traditional financial institutions and academia?

> How do you even define a pyramid scheme in a way that doesn't also cover traditional financial institutions and academia?

These places have already got laws against pyramid schemes, so I’d start by asking a lawyer to explain the various existing laws: https://en.wikipedia.org/wiki/File:Pyramid_Scheme_Illegal_Ma...

Crypto isn't entertainment, it's greed pure and simple. It's a pyramid scheme where once you join, you have to sell the idea to others to increase your value.

Crypto isn't the first of this kind, nor will it be the last. But it does use obscene amounts of energy to make the scam work. And the energy requirements become greater year after year. It is not sustainable in our civilization.

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