The entire world should ban it. Burning the energy requirement of a nation to do less than 1M transactions per day, when credit cards alone handle 1 BILLION transactions per day, is absurd.
And if you don't think inflation resistance is important, consider how many poor people have been robbed by those who just print more money and give it to their friends. It's been happening for centuries. It has destroyed whole countries just just once or twice but many times. Coin clipping to fund wars is as old as coins. So is stealing people's money at the point of a sword.
On the outside it might not appear 'efficient' when you don't have to implement all the same features bitcoin has. But if you actually try to build a system with these features, there is no better way so far.
Just be honest with what it is — a speculative asset everyone is hoping to get in "on the ground floor of". It only has value today because you can convert it to fiat, do you really think people would still use it if that were to change?
In some countries, bitcoin might be better... but there's got to be ways to help them that don't involve the whole world mining.
It might not have inflation, but I suspect that if the whole world switched to CC we would still have poverty, still have slave labor type wages for some, and all the usual stuff.
Bitcoin specifically seems to have a built in regressive tax in the form of transaction fees. Even sales tax is a bit better because that has exceptions for most essentials. This punishes those who rarely ever make transactions above 100$ and rewards those who make large ones regularly.
What does immutability of the underlying record have to do with fluctuations in the tokens market value?
If you truly believe that replacing that with a non-state controlled currency that does not allow for monetary control is something government will allow or is even something that the general public would want, you're diluting yourself and are way to deep into the crypto bubble.
The only reason you hear anything positive about cryptos from the general public is because they think they can make a quick buck.
This is fixed with off-chain transactions, which negate the benefits of using a blockchain in the first place.
Your point that their usage doesn’t accelerate over time is valid, but as the link notes, this is still a significant energy burden on the country and should be addressed over time. It can be worked on in parallel to efforts to curb the growth of crypto coin energy waste, so there’s no harm in encouraging reductions to both.
They have figured it out. It's becoming exceedingly difficult to find incandescent Christmas lights these days. A quick check on two of my local big box store websites shows that non-LED Christmas lights are not even available for sale. LED lights use an order of magnitude less energy, so the current energy consumption is going to be quite different.
Environmental concerns are a temporary issue & Bitcoin is moving to renewables faster than most anything else for a variety of reasons.
An outright ban is an absurd policy aimed at being punitive towards something people have an irrational hatred for. If you care so much about the environment just have reasonable energy policies such as a carbon tax and nobody would mine BTC with fossil fuels because it would be too expensive. Plus then you’re improving every other industry too instead of attacking cryptocurrency and making an insufficient impact on CO2 emissions in the process
The energy being renewable doesn't mean much if it still wastes it. It could be used for something actually useful.
Well, what else is it for? All the things to be "put on the chain" (including transactions btw.) already existed in a more efficient form.
> Environmental concerns are a temporary issue
The environment is a concern for as long as humanity exists in it. And Carbon emissions are far from the only problem Mining causes:
https://www.bbc.com/news/technology-58572385
37,000 tonnes of waste per year. That's 37,000 tonnes of electronics for which raw materials must be gathered and processed, which must be assembled, transported.
> Bitcoin is moving to renewables faster than most anything else for a variety of reasons
https://www.sfchronicle.com/opinion/openforum/article/Bitcoi...
https://ohiorivervalleyinstitute.org/bitcoin-mining-breathes...
https://fortune.com/2022/01/05/kazakhstan-internet-bitcoin-m...
https://www.marketplace.org/shows/marketplace-tech/some-stat...
And even without that: It's just a giant waste of energy. Using the Energy requirements of a nation to process less than 0.5M transactions a day, when credit cards alone process 1B in the same time?
If we have surplus electricity, we can use it to power desalination plants, lower energy prices in underserved communities or literally just pump water uphill to store it. Almost everything is a better use than burning through tons of hardware, just so computers can scream SHA256 hashes at each other.
[0] https://www.statista.com/statistics/881541/bitcoin-energy-co...
Assuming the power consumption for 1 BTC transaction is 1173 kWh as stated in the article, then we are off by a few orders of magnitude.
This is enough energy to run an IBM z15 mainframe at maximum configuration (~30kW consumption) for ~39 hours [0].
I am 100% certain that Visa can process more than 1.5 million transactions on such a platform in that amount of time.
[0]: https://ibm-zcouncil.com/wp-content/uploads/2020/01/IBM-z15-... (See page 88)
At the very least banks all have their own, right? And would they not want redundancy?
1.5 million might stil be a bit low though.
That's not how any of this works. Money is not stored anywhere in particular, unless we are talking about physical currency or commodities.
The entire point of a mainframe is to be able to centralize critical things (like credit card processing) that simply cannot be allowed to fail.
Most large banks and credit card processors operate their own pile of magic and then settle after the fact. It's not like VISA's IBM is the one big money bin that everything runs through.
> 1.5 million might stil be a bit low though.
In my scenario above, 1.5 million is a joke. That max spec machine could easily handle tens or hundreds of billions of credit card transactions in that timeframe.
The number of transactions has nothing to do with the energy spent on mining. Besides, the LN can already handle millions, if not billions, of transactions per second. You’re parrot
Yes I do. Why? Because they handled it for hundreds of years, and it works all day everyday.
> No currency in the history of the world has survived in the long run.
Yes, so?
> The number of transactions has nothing to do with the energy spent on mining.
The number of transactions is a measurement of efficiency.
> Besides, the LN can already handle millions, if not billions, of transactions per second.
Only between 2 parties, after opening a channel between them, which requires: A transaction. And neither party can use any of the funds transmitted via the payment-channel in the wider network until the channel gets closed, which requires: Another transaction.
The banking system imposes no such limitations: A transfer can be initiated at any time to any IBAN in the world, with no prior agreement, the energy cost is miniscule, and the moment the transfer is completed, the funds are available to the other party for transactions to whatever other IBAN they want.
Do you mean to say that you are fine and dandy with your purchasing power eroding over time?
All governments eventually start tinkering with the money supply. It's all well and good that you trust your government to do the right thing, sadly that's not the case for a large portion of the worlds population. Have you seen Turkey lately? Lebanon?
> The number of transactions is a measurement of efficiency.
The number of transactions would be the same, regardless of energy spent on mining. Be it 1 joule or a million.
> Only between 2 parties, after opening a channel between them, which requires: A transaction. And neither party can use any of the funds transmitted via the payment-channel in the wider network until the channel gets closed, which requires: Another transaction.
This isn't correct. The Lighning Network isn't just a channel between two parties. It's a network of channels between participants that allows you to transfer to any part of said network. You can open a channel to someone and never close it. Why would you? There are channels that are multiple years old at this point.
> The banking system imposes no such limitations: A transfer can be initiated at any time to any IBAN in the world, with no prior agreement, the energy cost is miniscule, and the moment the transfer is completed, the funds are available to the other party for transactions to whatever other IBAN they want.
This is really looking at the current banking system with rose-coloured spectacles wouldn't you say? What about the billions of people that do not have access to banking? You don't think there's any value in those people being able to use something like Bitcoin to interact with the wider international markets?
The Euros purchasing power has remained stable even through the worst financial crash in recent history.
So yeah, I think I'll be fine.
Show me how to open a bank account using this monetary system that you love so much, so I can receive payments from those clients and feed my family.
With Bitcoin I can open an account from my bedroom, for free.
/u/danlugo92 wouldn't necessarily need to open a bank account. There's always the black market. Maybe bitcoin to cash is the best approach?
In some places I can yeah. Most that do accept crypto go the Binance route.
I fail to see how this is all relevant, you're just moving the goal posts now.
I think a better example of moving the goal posts would be how Bitcoin has gone from “currency", to "store of value", to "digital asset".
Yeah that great depression that started in 1929 and sank the world, the stagflation of the 1980's, the crisis in 2008, the 7% inflation this year, all evidence the govt does a great job handling it
Money itself is mostly done fine. Mostly: There are exceptions, but (outside of wars) I know if only a handful of examples where governments had something less stable than Bitcoin.
I guess you could call it stable. A stable decline!
First: That, within certain bounds, is deliberate — a small level of inflation helps the rest of the economy by encouraging spending. The last thing you want is people HODLing their paycheques.
Second: your link shows an average halving time of the US dollar purchasing power of 22.5 years. Bitcoin has about the same price today as it was 6 and 12 months ago, but was about double that 3 and 9 months ago. Even the Brexit referendum’s effect on the GBP would be hidden in the noise of BTC’s volatility.
Second: Yes. No one is denying that Bitcoin is volatile. If you pick any arbitrary period of time you can come up with whatever statistic you want. This is not sound argument IMO.
Except: money stuck in savings accounts also means the money isn’t spent on goods & services, so fewer jobs are supported, so productivity goes down, which is effectively +ve inflation even with the money supply perfectly fixed, but fewer jobs also encourages more savings and also triggers a spiral.
Which effect dominates (+ve or -ve inflation) depends on other factors, but both ways are a spiral of economic pain.
2. What? This is specifically about which is worse, how can you not make this type of comparison?
> $nominal_interest + $inflation
Should either be:
> $nominal_interest - $inflation
Or:
> $nominal_interest + $deflation
But that's hardly a concern. When currencies fail, it's usually just another symptom of a deeper problem. Imagine Germany in the late 1920s with Bitcoin. There would still be mass unemployment, there would still be riots on the street, the Rheinland was still occupied, the government would still have to pay reparations, US companies would still be unwilling to continue investments in Germany. Almost none of the problems were caused by monetary policies.
And if a government destroys their monetary system with monetary policies alone, they can just introduce a new currency. That's not a apocalyptic measure.
Exactly. In that case, hyperinflation was a willed policy to get at anything of value, regardless of how destructive it would be in the long term, so that it could be shipped abroad (in this case, as war reparations). Making people dip into safe assets, trade them for rapidly worthless currency just to get by, is the whole point of hyperinflation.
Maybe an asset-rich person could get by for a while trading directly in his assets, but sooner or later they, or who they traded with, would have to deal someone who was forced to use government currency. At which point they would have to trade something valuable for something (rapidly) worthless: mission accomplished as far as foreign creditors are concerned.
Can you give me an instance of hyper (say, > 100% monthly) inflation where the government wasn't desperately paying off foreign creditors, or were otherwise desperate to ship value abroad?
The pound sterling has been running since 1489. https://corporatefinanceinstitute.com/resources/knowledge/fi...
I don’t think 600 years counts as long run when it comes to world history.
While the GBP value has changed over the course of 600 years, (of course it would, peoples and governments change in that same timeframe) hasn't a BTC as well?
If I sell an item worth $60,000 USD for 1 BTC, the next day the 1 BTC could be worth $40 or $50,0000 USD. Surely such volatility cannot be useful for a common currency.
"Stable coins exist" - and yes, they do - but if a stable coin is pegged to a currency, why do you not just use said currency?
I have no choice; my wages are paid in their currency, and they demand taxes in the same.
So I take on very little additional risk in using their money for everyday things.
Buying cryptocurrency, on the other hand, would expose me to a ton of new risks I'm not currently exposed to: to get remotely robbed with no recourse, that it should collapse in value by the time I would want to spend it.
It would not alleviate the risk from government at all: I can try keeping it secret from them, not declare it (which is illegal, risky, and gives additional headaches at the point I would want to spend it). Or I could let them know, which would leave me just as exposed to their old shenanigans.
I trust our proof of stake 100% more than arbitrary Bitcoin miners who mine bitcoins somewhere.
At least our normal currency has real stake like people saving money to afford a car, people working and paying of the house they life in, salaries etc
We already have a very well functional proof of stake system.
In some cases it's trauma-informed; they are, or know, people who really have experienced that kind of social collapse. It happens a lot in South America. People who grew up behind the Iron Curtain legitimately don't trust their governments either.
Where do you think the monetary system actually came from?
That doesn't have much in common with the "gold standard" monetary system as it was in the USA. That emerged from a monetary system of private banks that issued their own banknotes.
And it has practically nothing in common with the modern quantitative easing monetary system that is orchestrated by public and private banks.