Why All Cryptocurrency Should Die in a Fire
currentaffairs.org
currentaffairs.org
I'm rather mistrustful of people that are this forthy about being against a new technology. If it really is that devoid of merit it'll die on its own.
I also think it is a rather fundamental failure to see the big picture.
Not efficient? Well neither was the Ford model T. Newer generations are getting better.
Similarly somehow existing systems seem to get a free pass for things that are consider fatal flaws for crypto. Criminal enterprise? What do you think all the drug trade and sundry criminals use? Seashells? No USD. Systemic risk? Fed is printing trillions and history is littered with financial crises. Humans have managed to make everything from CDOs to tulips crash. Its not unique to crypto.
Personally I think crypto is a 50/50 chance of working long term. The people certain it'll be a disaster seem just as silly as those certain it'll take over the world.
Exactly as a chance of meeting a dinosaur on your street today? What a coincidence.
I believe this top comment reveals the real reason why many technologists actually hate cryptocurrency: https://news.ycombinator.com/item?id=31356579#31356857
I don't really give a crap about what people do or don't do with new technology, ultimately what people want to spend their time and money on is up to them.
However, "Crypto" is different. If all it was was just the unbelievably irritating crypto bros rug pulling, ponzi scheming, wash trading, ugly NFT shilling and hacking all the while claiming to be at the spearhead of a solution to pretty much every human problem in existence then so be it. I would be capable of ignoring it. I would read a different article, do some work or go for a walk, ignored, done.
But "Crypto" (specifically the energy intensive kind) has a different problem, and that's that it has /massive/ externalities that it simply ignores, forcing us, the people who want nothing to do with it, to now deal with it, and with the people in the ecosystem that we find so objectionable. We are dealing with the significant fallout from their hobbies. We are in the middle of 1) a very serious climate crisis 2) a cost of living crisis where people can't afford energy to cook and heat (in the UK at least) and 3) a war that would likely be brought to a stop sooner if we could phase out Russian gas sooner.
All things that could be alleviated if "Crypto" and it's so-far intangible benefits were to dissapear.
That is why I hate "Crypto", that's why I call people out about it, why I'm "frothy".
> Not efficient? Well neither was the Ford model T. Newer generations are getting better.
The Model T allowed people to do something that previously hadn't been done before. So far no-one has been able to point me at a single thing that public public blockchains do that either is worth doing and is only possible using blockchain tech, or is better (more power efficient, faster) than using pre-existing technology.
If people can point me at some of these things then we can at least start having a discussion about wether it's worth spending an entire country's worth of electricity on it.
All of these things are the result of bad governing, not crypto. Maybe banning crypto would help them (I don’t believe that) but banning lots of other things would also help. What we really need is better energy policy, better foreign policy, and better regulation of companies destroying the environment and contributing unnecessarily to climate change.
Edit: The vitriol in some of the replies to this is fascinating. Did you all just lose a fortune in the crypto crash or something?
> Maybe banning crypto would help them
It seemingly serves no purpose, and yet takes up a huge amount of power, which in it's absence would allow us to phase out a lot of our fossil fuel usage, which could include Russian gas.
We get it.
It’s not cryptos fault that it’s a terrible currency. Just invest in it. It’s not crypto’s fault that it’s a terrible investment. Why don’t you want a great currency that government doesn’t control? It’s not crypto’s fault that half the money in the ecosystem is stolen. Why isn’t the government helping this anti governmental technology? It’s not crypto’s fault that the vast majority of the coins are scams. It only failed because Citadel and Blackstone attacked it.
No, crypto is pure and faultless. And anything that it does wrong is the fault of the government and/or Blackstone and Citadel and/or the Paper Hands.
I have seen many many people pointing out the shady dealings and the death spiral nature of Terra on social media like reddit. But they were shouted out with cries of "FUD!".
It's a ponzi scheme and if your caught holding the bag, it is always in your interest to continue the scam rather than call out the scammers. That is why crypto "communities" will never acknowledge negative facts.
Try re-reading my comment. I didn't say that.
(Happy to hear what value crypto offers that can’t be done with more energy efficient mechanisms.)
The point of (good) cryptocurrencies is that they require real energy to coerce. Because of this I’ve felt safe keeping savings & transacting in bitcoin for years, I’m sorry that you don’t see that as valuable. Good luck with your ban, it isn’t smart.
What's your reason behind believing that? From what I know , Bitcoin mining fell 50% when China banned it [1]. How would that not be similar if the US + EU just bans it tomorrow?
[1] https://www.theblockcrypto.com/post/109315/bitcoin-hashrate-...
https://www.coindesk.com/tech/2021/12/09/bitcoin-hashrate-ap...
Let's reframe those values slightly - every bitcoin transaction uses about as much electricity as it costs to run my house for nearly six months.
Are you sure that's not having an adverse effect on energy prices?
Why does that even matter, a rich guy travelling in a private jet uses more energy compared to you travelling in commercial jet, does that mean we should ban private jets?
In other words, the metaphor is bad.
By that logic business class should be banned because business class customers get preferential access compared to economy customers and they use more energy.
Don’t believe everything you hear on the internet. The vast majority of these articles lead to Mora et al which has been thoroughly debunked.
Ah, the "have fun staying poor" argument of "y'all are salty you missed out". Is it really inconceivable for you that some people may have (a) concern for a massive, energy guzzling Ponzi scheme (b) that just this week was revealed to cause "billions" in losses in others in their society (c) that they have been calling out for months and have only gotten vitriol for?
No, their pockets must have been directly hurt to be this salty. It's not like people are capable of having intelligence, empathy, or a desire to build a better world if it doesn't line their pockets, right?
>> Is it really inconceivable for you that some people may have (a) concern for a massive, energy guzzling Ponzi scheme (b) that just this week was revealed to cause "billions" in losses in others in their society (c) that they have been calling out for months and have only gotten vitriol for?
I think getting incredibly angry about those things, to the point that the usual type of rational HN discussion cannot happen, is idiotic. Discussing crypto here has become like discussing US politics. It's just not possible because everything is described in black and white/good and evil terms. Claiming that getting rid of crypto will lead to the resolution of national and international crises is stupid.
Once somebody spends $400,000 on an ugly ape and then found they spent their money for nothing, they will become a permanent enemy of crypto. It’s just a matter of time before you join us (crypto haters) the difference is that some of us knew it was a scam right away and others will have to learn it the hard way.
Some people will react the way you say, yes, but others, after spending $400k or whatever for a worthless NFT, or for some combination of “coins”, will double down, unwilling or unable to let themselves see the truth because that would mean they were wrong in a spectacular fashion.
So they push for crypto harder than ever, to get other people to come in, prop the system up, keep the value of their purchase up, and validate their worldview.
Another possible outcome is that people will pretend the whole thing didn’t happen.
(From the viewpoint that it is possible to learn from other people’s mistakes, people are already pretending the tulip bubble, law’s scheme, 1829, 1969, 1999, 2008, etc. didn’t happen. That Charles Dickens, Emily Brontë and the other authors of those awful Victorian novels lost their money in railroad bonds. The difference is railroads go somewhere, Aries don’t.)
Jeez, you must be a very rich man by now, with all the extensive shorting of crypto this amazing early insight must have allowed you to execute.
Congratulations.
Those who have these insights usually also know the aphorism "markets can remain irrational longer than you can remain solvent".
You mean in unregulated centralized exchanges like binance and FTX, whose entire existence depends on the existence of these Ponzis? When they can just press a button, cause a flash spike, and liquidate all of your winning whenever they feel like it?
Yeah, I'm sure that works perfectly. After all, why would they be dishonest?
Using privacy coins I can donate money to causes I believe in (eg WikiLeaks) without fear of reprisal and with the knowledge that the funds will reach their recipient. If you have a better way, please let me know.
I don’t need $30,000k Bitcoin to support Wikileaks and my blogger. $10 Bitcoin works perfectly for this.
But people hype and fraud coins to heights they shouldn’t be and make it useless for actual use.
I think Eth is a good idea. I like smart contracts. But Etherium doesn’t need to be $3k and transactions shouldn’t be $10. $1 Eth and $.01 transactions is still perfectly fine for a sustainable system. But that doesn’t make people millions and billions by milking idiots.
I think if we had regulators preventing wash and pump and dump then we can just pick dogecoin or whatever and move on to digital cash. Until then, it’s not going to be possible with dogecoin going up 10x and down .1x along with everything else.
> Etherium doesn’t need to be $3k
The reason they're priced so high is because most of the supply has gone to early adopters (and its creators in case of the 70% premined Ethereum) leaving late adopters in fear of missing out and fighting over crumbs.
> we can just pick dogecoin
Dogecoin admittedly has higher inflation, but still had early miners getting 50x more reward than current ones. If you want to deter speculation, it makes more sense to just have a fixed reward, i.e. a pure linear emission, that maintains a high inflation for the first few decades.
Currently should be stable and predictable. There’s no need for early adopters to get rich. I just need to buy a pizza without cash.
Private or not, which country are you in that would penalise you if you donated to Wikileaks?
Ultimately though, there's a decent argument for /not/ allowing completely anonymous money transfers as the list of organisations that you'd be penalised for donating to probably has a pretty strong overlap with the list of organisations that society as a whole, through it's government, has decided we don't want to receive money.
Crypto /might/ allow you to make an end-run around this system, but do we want it to, and even if we do, is it worth an entire country's electricity usage?
Didnt US companies stop payments to Wikileaks because they exposed the US govt, atleast with crypto Wikileaks and others can bypass US payments systems.
1) Crypto is easily traceable. Far more than any other means of funds transfer if you exercise even modest efforts to hide the source of funds. And to the extent crypto provides a modicum of privacy it’s because it’s too small for governments to have put any restrictions on it.
2) There is absolutely no guarantee the money will reach Wikileaks. At best, the money will reach the holder of Wikileaks’s private key holder. As we found out with Coinbase, for the vast majority of crypto wallets, that’s not gonna be your intended recipient.
3) Even “The money” it’s a term Is debatable. If you sent them that crypto 1 month ago and they tried to withdraw it today, at best they would have got half the value you sent them.
There is nothing unique about crypto in terms of privacy other than the fact that most governments haven’t bothered with it. In fact, crypto is so easily traceable I’ve always harbored half a theory that it was created by the CIA specifically to chart out and bust drug and terrorist rings.
I wouldn’t be surprised if the only reason the government isn’t taking down/regulating crypto is because the intelligence agencies are just so thrilled with the awesome network information they’re getting about criminals through their crypto transfers.
That’s just wordplay, algorithmic stablecoins have been problematic and crashing since the beginning and a big one just crashed. Call me when USDC or DAI crashes - specifically not Tether because it’s arguably also undercollateralized.
USDT is a centralized stablecoin, same as USDC.
So in your argument that comes quite close to "No true Scottsman" fallacy, what is the exact criteria that you are using to separate out the "stable" stablecoins from the "unstable" stablecoins?
1. Filecoin: It was well-motivated from the start, to provide a cheap way to get counterparties (by default, a multiple of six) to pin content in IPFS. I don't regard it as a proven technology yet, but it's usable as it stands;
2. Brave's BATs: Brave annoys me with its cryptocoin boosterism, but in principle this provides an way for content providers to profit from gaining a readership that doesn't involve nasty ad-tech. I don't think the system provides good enough incentives for users to mint BATS as it stands, but I think that in principle the Brave team have a viable solution to this problem.
3. The Stellar payments infrastructure has a cryptocoin used to grease its wheels. I don't see Stellar's choice to mint their own cryptocoin as principled here (they could have allowed nodes to choose), but using some cryptocoin here is driven by use.
None of these coins use Bitcoin / present-day Ethereum style proof of work, so they do not appear to have the negative externalities you deplore.
Is there any reason this needs to be on a public blockchain? What are the benefits? Why is this a better solution than Brave keeping points/payments data in their own database?
The use of crypto here has the same reason as use of crypto almost anywhere else, to sidestep regulations and liabilities. Doesn't matter whether those regulations are there for very good reason.
That might work in a jurisdiction where the trade in cryptocurrency is illegal but its possession is allowed, but I can't imagine a US or European court would take that argument seriously when crypto has a demonstrable market value. The court would almost certainly treat crypto like a commodity in that case. Wheat doesn't have KYC requirements, but if you knowingly and demonstrably facilitate wheat trades on behalf of a sanctioned entity, you can expect some legal trouble.
Cf. e.g., from 2018, https://thenextweb.com/news/brave-blockchain-cryptocurrency-...
Blockchains are interesting, they're useful sometimes.
Of course, the externality is shoved on ALL of us with worsening environment, climate crisis, higher cost of electronics to do *real* work (no, your 10^15 hashes where -1+10^15 are thrown out IS NOT REAL WORK).
I hope EVERY shitcoin peddler loses everything.
Shitcoins are climate-destroying ponzi schemes. They're a negative-sum that the world ends poorer with the more they're made/generated/mined.
One person buys a Bitcoin that another person sold, which is zero sum. But miners burned real energy paid with not-Bitcoin to process it, thus value exits the system. Thus it is negative sum.
I do understand your point though I think. Waste in general is bad.
You don't need to mine more aluminum if you're able to use recycled aluminum in your products. And Apple does.
So Apple is perhaps not the best choice of a company to pick on in this particular part of the argument.
The jackass was boasting that he’d bought a graphics card from a scalper and was so happy he could mine Etherium. I told him I didn’t want to hear about it.
However, the main point was that I don't want to deal with them, and under normal circumstances I could just ignore the relatively minimal interactions I have with them.
But because I am effectively fighting back against /their/ externalities affecting me I have to seek them out. To learn about their hobbies, to find out about what it is they are doing.
Then it's a case of discussing wether the power consumption is worth it.
So far in this thread all that anyone's come up with is "because I might want to send money to someone that my government has banned money transfers to".
I have previously asked elsewhere and got a load of answers which fall into the "technically can be made on the blockchain, but can be done far more efficiently and effectively using exisint tech", eg. carbon credit trading, and (rather surprisingly) "publishing a website".
I think there is lots of utility in the space, even if BTC isn't it. My Urbit ship that gives me control of my own data is only partly related (but very useful) in that Urbit IDs are put on Ethereum because it works as a good ledger of ownership and stops floods of spam taking over communities.
A frequent companion of anti-crypto arguments is inflation is good. As a tool for goading humans into behavior like destroying the planet with overconsumption (oddly enough the same flavor of argument anti-crypto people use against crypto), I don't believe inflation is a good. I'd love to have open, curious discussions around this but it never happens. People just say inflation is good because otherwise people would stuff their mattresses and not eat.
We should eat only when we need to and spend conscientiously. Inflation is not a positive force for these two maxims. Somehow that idea has turned into heresy.
Are you honestly blaming cryptocurrencies for climate change, inflation and Russia‘s war against Ukraine? That’s crazy.
Climate change is a long running issue that started waaay before Bitcoin even was invented. Still projects other than Bitcoin are working hard to implement staking to use much less energy.
Inflation is an issue brought on us by Western governments drowning in debt for decades: For wars in Afghanistan and the middle east, unsustainable social security systems, stimulus packages.
And Russia … Putin and his supporters have finally come to terms with the fact it lost its super power Status and in a peaceful manner make the most of their vast and empty territory.
No, I don't think you understood what I wrote.
> Climate change is a long running issue that started waaay before Bitcoin even was invented.
What's your point here? Climate change has been around for ages so it's OK to blow a load of electricity on something that's not particularly useful?
> Still projects other than Bitcoin are working hard to implement staking to use much less energy.
Bitcoin isn't though, and Ethereum has been 6 months away for what, more than two years? They may never change. In the mean time it's blasting through a shit-ton of power for little to no actual value. Happy for people to stop burning through that power and pick up their hobby again when the power usage has been sorted out.
> Inflation is an issue brought on us by Western governments drowning in debt for decades: For wars in Afghanistan and the middle east, unsustainable social security systems, stimulus packages.
Power companies are literally putting their prices up because of a shortage of sources of power. "It's OK if we use all this power because governments are also bad" is kinda ridiculous.
> And Russia … Putin and his supporters have finally come to terms with the fact it lost its super power Status and in a peaceful manner make the most of their vast and empty territory.
I don't understand what you're trying to say here, that Putin invading Ukraine is making the most if it's vast and empty territory?
So shall we stop inventing technology that draws power because it’s bad for the environment? I mean Bitcoin isn’t consuming electricity just for fun. People use Bitcoin and that’s why it consumes power. Like people using air conditioning, fridges, washing machines and cars. Furthermore, the raw KWh figure the Bitcoin network is consuming (which AFAIK currently is unknown because miners moved all around the globe in the last couple of years) is not a useful measure of its green house gas emissions as we don’t know how it’s energy is created. It could well be on renewables by large percentage as they are cheaper in some countries (e.g. hydroelectricity in Norway) and mining is expensive.
> Power companies are literally putting their prices up because of a shortage of sources of power.
Price surges among some goods are not inflation but simply an indication of scarcity. Power scarcity affects Bitcoin as much as other sectors of the economy. Price surges across all economic sectors are inflation. BTW: It’s the inflationary policies of the FED and its equivalents creating cheap money and driving the investment bubbles … including the crypto bubble. If you‘re angry about the crypto craze put the blame also on the current monetary regime.
> I don't understand what you're trying to say here, that Putin invading Ukraine is making the most if it's vast and empty territory?
I was referring to parent‘s blame of the Ukrainian war on cryptos. It’s not the fault of crypto heads that Putin invaded its neighboring country and caused gasoline and electricity prices to rise. BTW: It’s probably not even Putin‘s fault alone. Government regulations to support the transition to renewable energy sources have been pushing prices up for electricity and gasoline already for years, at least in Europe.
That wasn't my argument. My argument was that Bitcoin etc. are bad because of the power they consume when as far as I can tell almost all of what happens on these blockchains can be done far more efficiently and faster on existing technology, or in the case of transactions, existing banking infrastructure.
> People use Bitcoin and that’s why it consumes power.
I don't doubt it, it would be nice if they owned their externalities so I could stop being angry with them for it.
> Like people using air conditioning, fridges, washing machines and cars.
Things that we (realistically in modern society) need. The alternative to, for instance, washing machines would be to hand-wash clothes.
We don't need Bitcoin. It hasn't enabled anything that couldn't be done already using the banking system, or with existing non-power abusive technology.
> Furthermore, the raw KWh figure the Bitcoin network is consuming (which AFAIK currently is unknown because miners moved all around the globe in the last couple of years) is not a useful measure of its green house gas emissions as we don’t know how it’s energy is created. It could well be on renewables by large percentage as they are cheaper in some countries (e.g. hydroelectricity in Norway) and mining is expensive.
Worldwide power generation is a zero-sum game. There is limited power generation available each day. Right now even though we're trying to move to renewable or green energy, there is not enough of that to power what we need through renewables alone so we use fossil fuel.
If you removed the blockchain load from that system you could reduce the fossil fuel burn by approximately one whole country per day of load.
It doesn't matter where the generation comes from, using any of it to power what is effectively a pointless distrubuted heater is removing our ability to shift away from fossil fuels.
> I was referring to parent‘s blame of the Ukrainian war on cryptos.
Once again, that's not what I wrote. Ukraine is at war with Russia. Much of the rest of the world is at war with Russia by proxy, because most of the rest of the world is sick of Putin's bullshit.
Putin is making shit loads of money from selling Gas to Europe, especially Germany.
If we instead of running PoW blockchains, and used the far more efficient existing banking infrastructure, we could almost completely shut off all of Germany's gas from Russia (at least that portion used to generate electricity), significantly weakening his position.
It's a zero sum game. We're using renewable electricity to power bitcoin so we have to use fossil fuel for other stuff.
Plus, the whole "bitcoin runs on renewables" thing isn't entirely true https://www.theguardian.com/technology/2022/feb/18/bitcoin-m...
> Government regulations to support the transition to renewable energy sources have been pushing prices up for electricity and gasoline already for years, at least in Europe.
I'm pretty sure renewables are actually cheaper to produce than fossil fuels.
The advantage of Bitcoin may seem questionable if you believe dependency on central banking is fine and hedging against financial risks of traditional banks is silly. But mind you there are many people in the world without access to stable banking services.
> If we instead of running PoW blockchains, and used the far more efficient existing banking infrastructure, we could almost completely shut off all of Germany's gas from Russia (at least that portion used to generate
Come on, the number of Bitcoin miners in Germany might approach zero. Energy is way too expensive there. Miners operate in countries with access to cheap energy (which could be coal like in China but also renewables like in Norway). There may be validation modes in Germany but those draw much less power than a mining facility that append to the ledger. So Putin wouldn’t even notice if Central Europe would be shutting down the Bitcoin network.
And do you know what services had similar energy consumption in the past and nobody cared? Peer to peer file sharing like Bitorrent. Running seeding nodes 24/7 or your desktop computer for days just to download illegal copies of movies and software was not exactly environmentally friendly either. Can’t remember any outrage about that. While it’s valid to criticize Bitcoin‘s energy consumption it is not completely out of place and not without precedent.
> I'm pretty sure renewables are actually cheaper to produce than fossil fuels.
Yes, they‘re cheap to produce but very expensive to distribute. Germany e.g. heavily subsidized renewables in the past making electricity very expensive here (AFAIR even one of the most expensive in the world). The most economic renewable currently is hydroelectric power where you also can regulate power generation in response to demands.
But that wasn’t my point. I was just arguing Bitcoin is not a significant contributing factor to rising electricity costs.
> Worldwide power generation is a zero-sum game. There is limited power generation available each day. … It's a zero sum game.
No, that’s not how markets work and energy markets neither. If demand rises energy producers react by increasing production, if demand falls they lower production. If demand rises long-term, they invest in more production facilities. That, of course, takes time so prices will rise temporarily but still creating an incentive to invest. If Bitcoin miners manage to leverage renewables they might actually encourage a net production rise of renewable energy.
BTW: The Bitcoin network‘s power consumption is not fixed either, it depends on the network load and the number of miners competing with each other. At the peak of the bubble it may be much higher than on average. The next crypto winter is likely to come soon and then power consumption goes back to normal. Until the next crypto craze competing networks will hopefully have switched over to Proof-Of-Stake successfully.
Source? I am pretty sure that is not the case. Not by a mile. You don't seem to understand the scale of PoW energy waste.
Not exactly for fun, but sort of: frivolously, needlessly, and with an arms race dynamic: Put in 1000x more energy, and you get - exactly the same result, because the algorithm adjusted the Proof of Waste to make it 1000x more wasteful.
This is pretty shallow thinking. I’m sure the traditional banking system uses orders of magnitude more energy than crypto, but you don’t hear about that cause the “studies” about crypto energy use are funded by people who benefit from maintaining the status quo. In fact, you will notice most of the studies critical of Bitcoin focus on how much ENERGY it uses as opposed to its fossil fuel usage and greenhouse gas emissions. This is likely intentional.
Big tech companies like Facebook and Twitter probably use more energy than Bitcoin too, and it is debatable how much of what they do actually creates value in the world.
The U.S. military is one of the largest polluters in the world, and Congress nearly unanimously gives them hundreds of billions of dollars every year with very little debate or scrutiny or oversight.
The waste of natural resources and energy will not disappear just because crypto goes away. If anything, crypto will actually help SOLVE the problem sooner by creating real economic incentives to use cheaper and cleaner energy. Some estimates say that over 60% of Bitcoin mining now uses renewable energy, and it is trending in the right direction [1].
> So far no-one has been able to point me at a single thing that public public blockchains do that either is worth doing and is only possible using blockchain tech
“Worth doing” is subjective so that’s a non sequitur, but I will give you something blockchains do that is only possible using blockchain tech: they allow control over the supply of money without a central authority. Separation of money and state, if you will. Some may scoff at this idea, but currency debasement has contributed to the collapse of many empires and governments in history [2] so the importance of this invention should not be understated.
[1] https://bitcoinminingcouncil.com/wp-content/uploads/2022/04/... I’m aware this study may also be biased in a similar way as the ones mentioned earlier, but it at least includes the methodology and sources.
[2] https://www.visualcapitalist.com/currency-and-the-collapse-o...
Do you understand how markets work? What's disincentivizing the current energy users from seeking out cheaper and cleaner energy? Why would we have to invent a new coal-chugging[1] ponzi scheme to kick off that search?
[1] https://www.theguardian.com/technology/2022/feb/18/bitcoin-m...
> This is pretty shallow thinking. I’m sure the traditional banking system uses orders of magnitude more energy than crypto, but you don’t hear about that cause the “studies” about crypto energy use are funded by people who benefit from maintaining the status quo.
The people who benefit from the status quo (ie. regular banks) are pretty much everyone in the world who has a bank account and does transactions. That's a lot of people.
Bitcoin (ignoring eth and others for the moment here) might use half (not orders of magnitude) as much energy as the regular banking system (eg. https://www.nasdaq.com/articles/research%3A-bitcoin-consumes...), but it services far far more people than bitcoin does.
Bitcoin handles (I'm googling these) 4.6 transactions per second, Visa somewhere between 1700 and 65k per second (https://www.visa.co.uk/dam/VCOM/download/corporate/media/vis...), depending on where you look, and that's just Visa, that's ignoring all the other banking systems out there.
You could roll those BTC transactions into the current banking system and the power usage of the regular banking system would hardly budge. You could save one half of the banking systems entire power usage by transacting using the banking system instead of bitcoin.
> In fact, you will notice most of the studies critical of Bitcoin focus on how much ENERGY it uses as opposed to its fossil fuel usage and greenhouse gas emissions. This is likely intentional.
Yes, because right now we are struggling to migrate off fossil fuel. This is a zero sum game, there is a limited amount of electricity we can generate right now, if you use some of the green energy to bitcoin it means you use fossil fuel for other things. If you use fossil fuel for bitcoin you can use the green energy for other things.
Removing the power usage of bitcoin means you can scale down the energy required by the system, and you can choose where that scaled down energy comes from. I suggest it should be taken from the slice of fossil fuel energy that is being generated.
> Big tech companies like Facebook and Twitter probably use more energy than Bitcoin too, and it is debatable how much of what they do actually creates value in the world.
It depends what you mean by value, but lots of things use energy create "value". Some things (facebook for example) can't be done without the web, servers etc. Some things (for example financial transactinos) can be done using existing technologies OR vastly wasteful tech such as bitcoin. There's a choice there.
> The U.S. military is one of the largest polluters in the world, and Congress nearly unanimously gives them hundreds of billions of dollars every year with very little debate or scrutiny or oversight.
Look at that bad thing, because that bad thing is allowed to exist so should the bad thing I care about!
> The waste of natural resources and energy will not disappear just because crypto goes away. If anything, crypto will actually help SOLVE the problem sooner by creating real economic incentives to use cheaper and cleaner energy. Some estimates say that over 60% of Bitcoin mining now uses renewable energy, and it is trending in the right direction [1].
See the previous reply about energy generation being zero sum.
The fact remains, that wherever the electricity for Bitcoin et. al. comes from, it's using about one countries worth of electricity, and if it wasn't, if the things that were being done using bitcoin were being done in a more efficient way using existing tech, that renewably electricity could be used to offset the fossil fuel generated energy.
> > So far no-one has been able to point me at a single thing that public public blockchains do that either is worth doing and is only possible using blockchain tech
> “Worth doing” is subjective so that’s a non sequitur, but I will give you something blockchains do that is only possible using blockchain tech: they allow control over the supply of money without a central authority.
Why is that bad though? There's good reasons why it makes sense to control what a countries money is worth, for instance controlling inflation.
> Separation of money and state, if you will. Some may scoff at this idea, but currency debasement has contributed to the collapse of many empires and governments in history [2] so the importance of this invention should not be understated.
Why is Separation of money and state something we want to aim for? It's certainly not going to stop currency debasement given that you still have to transfer bitcoin into something else to spend it (for most normal people/regular transactions), and at 4.6 transactions per second (at a cost of one half of a ragular banking systems power) you certainly can't use it to buy a loaf of bread directly (ignoring gas fees entirely).
You also have to compare it against what its competing against, all those fancy bank buildings with 24.7 lights and ac, the staff to mantain the paper trail (their commutes, etc), the vast security forces and militaries there to secure it (military being the largest polluter), etc.
From what I understand, the growth of the network, especially when it piggy backs on layer two networks like the lightning network for btc means 99% of the transactions can operate in a non proof of work method costing little more than the servers used to run a popular website.
Its still sooooo early. The tech will evolve and competition is fierce for the best solutions. So long we dont try to regulate it to death and protect the status quo, its going to evolve in ways we are yet to imagine.
I've seen several comments in this thread comparing BTC's energy consumption to that of the world's militaries; is this a new crypto meme?
I hate to be the one to break this to you, but we would still need police and the military even if the world only used cryptocurrency. The irreversibility of crypto transactions increases the ROI of crime, so I think we would need more police and larger militaries in that world. Also, non-financial crime and interstate conflict exists.
But that'll just mean more and more opportunity for PoliceCoin and WarCoin, so maybe it's actually sound monetary policy.
We know that now, but are stuck in a world with cars, we're trying to dig ourselves out of that hole.
We know that crypto[1] uses massive abouts of power when we're struggling to move off fossil fuels. We know that now, at the genesis of the crypto.
[1] the crypto I care/talk about, the power hungry kind.
Grossly inefficient personal transportation and industrial farming have massive externalities forcing people who want nothing to do with it to deal with it. That doesn't seem to be a concern that matters to most people. And they're exacerbating the same climate and energy issues.
Public blockchain can be powered by renewable energy, using its own value to pay for it, and can harness power in areas where it is not feasible to harness that power for other purposes.
Here's a podcast[1] episode with Saifedean Ammous, if you're interested in the value proposition. He claims Bitcoin actually saved his life, so obviously incredibly valuable to him. Lex does a pretty good job at pushing back on his evangelism.
But it is a concern, and it is being tackled in many places: gasoline is taxed very heavily. Farm subsidies are being reduced.
Just because not all externalities have been fully internalised yet, doesn't mean PoW with its massive externalities is fine.
Facilitating certain types of illegal transactions. Ex, Sanctions evasions for the average Moe, online illicit substance transactions between complete strangers. So I would guess the crux of your statement is actually the “worth doing” part.
I respect your position but I respectfully disagree.
Many bad things don't die on their own; we have to fight them to the end.
(We're slowly coming out of a global pandemic which was quite "devoid of merit", for instance, but it didn't recede on its own.)
I'm not certain, unfortunately. But I'm hoping.
I’m not certain it’s a disaster and I don’t hope for its failure. But I’m against it like I’m against best buy warranties or whole life insurance.
They are bad things that shouldn’t exist and no one should buy them.
Bring on the homeopathy! It hasn't died yet so it must have merit.
The chance is actually 100%, because future national currencies will be "cryptographic" tokens. Think of it for 2 sec: is there a government on earth that would say no to a financial system where you can track (poor) citizens' money down to the last penny, always and forever? There's your answer...
So “be calm bro, why so angry?” no longer seems like a legitimate criticism. If you want people to not be angry don’t build technologies that are highly destructive and cause immense harm.
Other arguments seem to be of the form “sure the last 35 cryptocurrencies didn’t do anything meaningful but number 36 and 37 are different I swear”. At some point even radical skepticism is a reasoned reaction.
Bitcoin is literally destroying the world and it’s main proven applications are facilitating illegal transactions. I wouldn’t be opposed to governments banning the thing on account of the fact it intentionally makes it impossible to adequately regulate digital transactions for fraud. This seems like it would be a reasonable response to the excessive firestorm of ransom ware that seems to be the only transaction that can reasonably pay the Bitcoin fees.
You misunderstand me. They can be angry all day long. My point isn't that they shouldn't be angry, but rather that it makes me doubt that their rationale is balanced.
>Bitcoin is literally destroying the world
That's true for damn near everything we do. Everything from cars, to space travel to computing to doing laundry.
> firestorm of ransom ware
And the internet brings an endless stream of viruses, spam, malware, hacking etc yet somehow people can accept that tradeoff just fine.
Few new technologies are pure positive only, or risk free, or awesome straight from the start.
Yould be pretty angry with people who started taking dumps in your backyard, you wouldn't consider yourself unbalanced to feel anger at that right?
Bitcoin is taking a metaphorical dump in my backyard and I'm angry about it. We're likely to blow past the 1.5°C climate target soon, it was too high anyway, we'll probably blow past 2, and I've got two kids who I don't want to die due to food shortages caused by the bad weather, or wars caused by food shortages.
Why bitcoin and not <list of things that use power>? Because Bitcoin etc. don't give us anything. Nothing. No-one can point at anything these things are good for. No-one in this thread, no-one before when I've asked.
Shit in your own backyard.
The author doesn’t want to wait it out because the cost to society in terms of wasted energy and support of bad actors is too high. He notes that he evolved into this position. At first he th out it was just silly. Then silly and annoying. Now just bad.
Looking from the outside, all the ones which matter seem to use PoW systems.
> and others are going to switch away from PoW (such as ethereum).
I've been hearing that for years, and it's always six months away.
"hearing" doesn't really mean much since random people can say whatever, but the switch to PoS has never been claimed to be 6 months away until this year. You're probably confused with the beacon chain with successfully launched in 2020.
Not sure this is the right metric, but you can see that the top of the list seem to represent the bulk of all crypto currencies. And if you want to include Tether, it’s apparently based on Bitcoin and Ethereum blockchains.
Bitcoin is proof of work, and is showing no sign of switching to something else. Ethereum is proof of work, and hasn’t switched to proof of stake yet. I mean the tech is ostensibly there, but last I checked the merge still didn’t happen. Even if it was just those two, I would not dare call them "some crypto currencies" like they were marginal. Bitcoin and Ethereum, aren’t marginal, they’re basically the majority all by themselves.
Also, I’m not sure how trustworthy proof of stake actually is. I’ll believe it when Ethereum actually implements it at scale.
There you go. Some cryptocurrencies will survive once the regulatory framework is more clearer and settles in which will result in most the useless ones and non-compliant ones withering away.
That is the most likely outcome rather than the maximalists believing all of them succeeding or the skeptics like the one in this article believing all of them being destroyed. We've have examples like introducing KYC/AML checks for the exchanges, then unregistered ICOs were made illegal in the US (other countries to follow). It still did not put an end to crypto.
Next will be the exchanges delisting privacy coins and the likely regulation of stable-coins.
And in the mean time it's chewing through energy and uselessly adding carbon to the atmosphere. Blockchain's use case is generally the conditions of needing both (a) an append-only log and (b) being distributed/decentralized. I don't think there are that many places where it'd be of use.
I try to raise awareness of NIST's Blockchain Technology Overview, which is a good explainer:
* https://csrc.nist.gov/publications/detail/nistir/8202/final
See especially Figure 6 ("p. 42", 53 of the PDF), which is a flow chart to help you decide on whether blockchain may match one's use case. Extracted:
But we unfortunately now also have blockchain tied together with the notion of "money", and so folks are going bonkers over it (à la tulips and Beanie Babies).
An idea can take a long time before people stop practicing it, during which does a lot of damage: it's been 70 years and we're still stuck with car-centric/dependent suburbs.
If cryptocurrencies can even be called "technology".
I have enough skills to implement a crypto currency from scratch. Some building blocks there are impressive and very useful: public key signatures, hashes. _Maybe_ ciphers and polynomial hashes as well. Those things I cannot design though I did implemented from specs (it was a ton of work). But as we all know, those blocks existed long before cryptocurrencies, and have lots of other uses.
Then you have the chained hash, which is basically a degenerated form of Merkle trees (patented in 1979) that look like a Git commit history. Git was first published in 2005, Bitcoin first appeared in 2008. Then you have proof of work (some computation that is hard to do, but easy to verify), which was an established technique before Y2K.
In the end, the one idea Bitcoin introduced that may not be obvious is this idea of a "longest chain", based on proof of work. We have proof of stake as well, but for now I’m waiting for Ethereum to implement it at scale to believe in it (right now most transactions happen in proof of work).
It’s a stretch to call that "technology".
Okay, so Mr Weaver can conjure some "ten trusted entities" by simply wishing them into existence.
Either he doesn't understand why one cannot simply create a "trusted entity" out of thin air .. which would mean, he's not actually an expert who anyone should listen to .. or he consciously makes a lazy attempt at formulating an argument that superficially sounds reasonable, while not having any substance.
Some problems are super easy to handwave away in theory but actually pretty difficult to solve in practise.
I have a hard time believing that you're actually trying to understand, which kind of trust the people who created Bitcoin meant and why they thought it's important.
Just claiming banks are in that sense trustworthy either neglects that banks exist in states and can be influenced or is plain naive.
We live in a world where states and central banks are constantly trying to achieve goals by changing money creation.
No matter if you see that as problematic or not, you'll hardly deny that currencies are subject to extreme pressures from economic actors (governments, banks, societies, businesses, ..). Therefore claiming that banks can simply be "trusted" to withstand these pressures (by strictly enacting some agreed upon policy) is a bit like closing your eyes on the real world situation of currencies.
Pointing out the limits of the currently implemented mechanism (in Bitcoin) does not equate to Bitcoin being inferior to the trust system of conventional currencies.
I was merely pointing out that your statement about currencies also applies to (at least some) cryptocurrencies. Large mining groups refraining from securing 51%, or colluding with each other to similar effect, is the only thing stopping them from having the power to maliciously inject fraudulent blocks.
So yeah, BTC's proof of work scheme seems to have some conceptual flaws. I'm aware of innovation in the space, but none have caught on the way BTC or Monero have.
The byzantine generals problem doesn't apply when you have trusted entities.
Except for the minor detail that you never do.
Perfect solutions do not matter.
The only thing which matters is good enough solutions.
For a state (i.e. most states in the current world) federated validators are good enough.
And systems which go beyond that (wrt. byzantine generals problem) have properties states tend to not want.
(I'm not judging if it's ethical good or bad.)
Let me make a different point:
I mean think about it for "legal" (legal unrelated to ethical) use-cases a federated systems of banks and maybe some external non-bank validators is good enough, by far.
Not "legal" use-cases are not legal and as such them not being supported is in the interest of the state you use them in.
Many of ethical good use-cases of crypto currency are not "legal", ethical yes but not legal anyway.
Like circumventing suppression in totalitarian states.
The problem is for each state by themself a "Byzantine considering" crypto currency is not in their interest. It can be use-full to help people in totalitarian states, but then this states can also use it to help extremist groups in your state while forbidding crypto currencies internally. So... not necessary the best choice.
Now federated not fully "Byzantine considering" crypto currencies are a different thing altogether. Like use bitcoing but replace PoW with PoS except the validators are predetermined banks with most in your country (or union like the EU, they might still stack money as collateral) and from a state view the problems are mostly gone/manageable (from a legal/state POV) and you get most of the technical innovation you want (I mean it is 99% the same tech minus "Byzantine considering" and maybe minus some privacy protections).
Now I'm not saying it's ethical good (or bad) for states to ban crypto.
But I am saying that from a purely objective non-ethic-considering view for most states it's best to just ban fully "Byzantine considering" privacy protecting crypto.
Which is a fine use case. Those are very large and enduring sectors of the economy. But let’s not get confused about why things are as they are.
edit the point here is - getting a "trusted party" is in fact, not easy, and certainly not "a bank" as a universal answer.. find your own copy of this book, it is repeated a hundred times, every decade.
Here’s the facts: there are two types of people in this world, and which you are has nothing to do with intelligence.
You either participate in these types of activities, and you always have and always will, or you don’t, never have, and never will. It’s like it’s some weird quirk in human nature where God said, 50% of the people have to be this way and 50% have to be that way in order for this to play out.
The participants have an extra hurdle to cross though. They have to watch the zero sum gambling game play out where some people win and others lose and the winners paint themselves as financial geniuses. It’s hard to be around that type of company and not feel bad.
Again, I’m not saying anyone _is_ dumb. The crypto community have many fine people who add all sorts of value to society. But if you’re participating in this game, there’s nothing anyone can do to change your mind because you’ll always have counter examples to point to, and no one likes to admit when they’re wrong, especially to themselves.
Did you park at the market? Oops, they read all license plates to build a marketing profile.[0][1]
See an ad online, and then later went into the store? Oops, Google picked up on that and told the retailer.[2]
Did you leave your face uncovered when you went into the market? Oops, they use facial recognition.[3]
[0] https://www.syracuse.com/news/2014/06/who_else_is_tracking_y...
[2] https://web.archive.org/web/20170523182250/https://www.washi...
[3] https://www.axios.com/2021/07/19/facial-recognition-retail-s...
I do this all the time in California and have in other states as well.
If you are sure your state bans non-reloadable visa gift card purchases with cash I would love to find out what state to research what is going on there.
In addition to that, even the few people people who do use Zcash, don't use it's privacy features. 99% of their transactions aren't private and are fully traceable [2]. Why would you want your transactions to stand out?
[1] http://zerocash-project.org/about_us [2] https://news.bitcoin.com/not-so-private-99-of-zcash-and-dash...
I've been using credit cards online for decades and I am yet to encounter anything negative from doing so. I get that my credit card provider knows that I'm buying £X of goods from merchant Y. But unless that merchant is very specific, the card company doesn't know what I've bought.
And, if it did... so what? Perhaps I'm naive, but even if I was hiding (for example) my sexuality - what's the CC company going to do? Try to upsell me a rainbow themed card?
I try to take my privacy seriously, and I don't particularly want my interactions monitored and mined. But what are the actual, non-theoretical problems that this causes?
Or more importantly, something that is normal today but becomes illegal with some future government (or court).
Having a paper trail of everything in perpetuity is always dangerous in the future.
Best to use cash for most things.
When this data inevitable leaks via hacks, or is used to target you when political tides change, suddenly you will be wishing we had all been normalizing alternatives.
I recommend everyone use tumbled bitcoin, monero, cash, or visa gift cards whenever possible. The less data we all give in aggregate to those seeking to sell changes in our behavior the better.
Your data pollution empowers entities that harm us all.
So does your actual pollution created by transacting in cryptocurrency.
But, for argument's sake let's say you can be put in jail or killed for your sexuality. You want to buy something from a specific store that caters exclusively to your sexual preferences. The CC company sells that to your government (or another entity wanting to enforce that), then you are arrested or killed, or you family harassed.
"There's no need for privacy because I have nothing to hide."
Again, it’s a valid concern but the GP was about real world use cases and it seems that’s not really one?
And if this is the concern why not use cash or monero or whatever for this particular transaction, surely the concern does not extend to all other transactions you are making?
Perhaps the person didn't realize it would be an issue. Perhaps they bought something ancillary and they're not that store's main target customer.
Basically people take for granted that they belong to the middle of the Gauss curve and forget this is neither true everywhere nor carved in stone, and certainly not consequence free.
Not to mention mass spying, which apparently every body is accepting now.
It feels like in the 30', where everybody is smooking cigarets and are think there is no problem right now with it, so they people raising concerns are not to be listened to.
Maybe don't live in a shithole country then. Use some of your money to move somewhere sensible.
Sure, in the western part of the world, you could think that this is paranoid, but depending on where you are in the world, and what minorities you belong to the risk is real.
Heck, even in the US with the way the SCOTUS is going, this may become relevant sooner than you'd expect.
(Also, we need a better term than "data brokers", as that term is biased toward their legitimacy. "Digital stalkers" or "stalkers for hire" imply that the stalking occurs after the point of hire, rather than being proactively performed on everybody. "Privacy abusers" is accurate, but non-specific. I don't have a term that would encompass the omnipresent spying, the danger of a dataset's existence against future threats, and the low price they put on our privacy. Bonus points if the term could call out the false dichotomy of public vs private.)
[0] https://www.vice.com/en/article/m7vzjb/location-data-abortio...
[1] https://www.cnbc.com/2022/05/04/data-broker-safegraph-stops-...
Edit: That said, advocating for privacy is not advocating for cryptocurrency. Cryptocurrencies are by design massively inefficient, in the same way that a low-trust society is inefficient, and somehow touts that as a virtue.
First, the data is accessible by credit card provider, but also by several financial and technical intermediaries. Second, there is no way for any of those companies to guarantee that the data will never be leaked.
Then, in terms of consequences, it includes reputional risks, security risks people know your behavior patterns, and to be arrested for being at the wrong place and wrong time. Then is all the track record of governmental overreach that used this type of data, from arresting environmental activists to killings based on sexuality (for example). It happened in everywhere, and it still happens today.
In that it's proven possible and how the world worked for thousands of years. The existence of KYC/AML and the ability of the state to surveil their population's financial transactions is very new and less than a human lifetime old. It's not necessary and privacy is definitely not impossible.
1) Able to donate money without it being blocked (examples: Wikileaks, eight-wing political activism).
2) No trace of activity that can be used against me (examples: WWII, looks like it might happen again in the near future, situation is tense post-COVID).
3) When the next recession hits, want to have protections against government haircuts (a la Cyprus or the bail in mechanisms that were prepared after 2008).
Cryptos fit quite neatly into a threat model where my government going rogue seems to be possible but unlikely. It makes a lot of sense to me to have $1-10k in Monero as a weird emergency fund/political tool. Dunno how it will work out, this isn't really territory that has been open before. If cryptos weather the next recession and hold >50% of their value then I'd start looking to put more serious money in.
I feel like you may have been auto-incorrected there, but I can't work out what you may have been trying to type that got changed to "haircuts".
Although to be fair those sort of manoeuvres generally mean that a bank is going under, so a % loss can be a better outcome than losing everything. It depends.
its not that the credit card company might sell you a rainbow card, its that you might not even get to exist.
Many things are illegal, but not immoral. You have probably broken the law in your life, most people have. ultimate surveillance is damaging to society as it strips away our ability to change "how things are done around here". I know a few sex workers whove had their bank accounts frozen and forced into cash/crypto, is that fair? are they really causing damage to society? theres many examples of sexism/racism from bank managers giving mortgages/loans with different rates depending on who they are talking to, could we use zkproofs to prove income/assets/liabilities without revealing personal information? amongst all the hype and speculation (caused by desperation in our current systems) crypto is about these issues and is doing real work to address them.
and thats before we even get into how things might change in the future. maybe its fine for a credit card company to know if you are gay today, what about in ten years? what if it becomes a crime again?
Other than the fact that "why do I need privacy, I'm not a criminal" (the battle cry of people who are lucky enough to have been raised in the 5 places on earth ruled by non-abusive governments) has been debunked a million times, you need to consider the fact that - just like the oodles of information gather on you by big tech - this gathering transforms you into a product, not a citizen.
Now, if you don't mind being treated like a shearable beast of burden, then, you're correct, that's not a problem.
But the merchant knows and (unless it's a very old mom & pop shop), they didn't do it manually, the itemized receipt is in their computer system. Which the government can easily obtain and correlate with the credit card transaction so now they have both.
As the downstream comments say, if you're any kind of persecuted minority, this is a big problem.
Then look at the numbers, besides speculation, which isn't really a "use case", that vast majority of cryptocurrency transactions are ransomware, coin washing, illegal purchases and currency control evasion.
> If cryptocurrencies can help people who don't have equal rights with more privacy in such situations then I am all for it.
> There is at least one third world country where a woman can't even get an abortion without risking life in prison. If cryptocurrencies can help people who don't have equal rights with more privacy in such situations then I am all for it.
What an extreme red herring? Even the most private cryptocurrencies are less private than the cash that such people use today for such transactions.
Sorry to be the bearer of bad news, but this is just flat out wrong.
Also sorry I'm not able to provide tangible proof other than I have personally witnessed and been affected by the exact opposite of what you claim.
IBAN transactions big and small are extensively monitored and not on a one-by-one basis but rather used to paint a clear picture of economic actors and their interactions.
Not even vaguely true of "exactly how does yashg use their credit cards", which many people can answer in as much detail as they care to purchase.
(Why I support Monero over Bitcoin.)
The billions (trillions these days?) online advertising market clearly disagrees with you.
Things are allowed inside crypto that is not allowed in the normal world of finance.
Ie stable coins: promising people 20% on their savings account by running an obscured ponzi.
Ie pump and dump.
Ie insider information. Insiders on exchanges buying up coins they know are going to be listed.
Etc etc.
(And proof of work of course is the key enabler as it allows those who are running things to hide their identity.)
Are not a real cryptocurrency.
> pump and dump
Is absolutely a regular circumstance. Last what I remember is sawn wood situation on the very early 2022, afaik it is worldwide. I do not recommend you to buy right now a sawn wood from big stores before researching a market in your location, because some of big stores have been dumped after buying some big amounts of sawn wood on huge prices, and their warehouses are still full of this trade offer.
> insider information. Insiders on exchanges buying up coins they know are going to be listed.
All of that coins usually does something opposite to skyrocketing very soon after early birds have received a way to short their tokens (I do not have any counter-example).
> proof of work of course is the key enabler as it allows those who are running things to hide their identity
Some entities just don't have an identity, like an artificial intelligence. What if I want my pet AI to buy or change hosting without absolutely any of my participation or even knowing? (it is not my funds, the pet has earned it without my participation as well).
The crypto ecosystem is as far away from level as possible. You need to have major connections with the powers that be to be remotely successful
Complaining that crypto is stupid is fine, but lots of things in history were stupidly valued (tulips, beanie babies, bored apes) and eventually the market did or will change. Crypto is worth whatever people will pay for it. It's not inherently evil.
Only one of those things requires enough energy input to drive a massive V8 Landrover for a week every single time you try to exchange it, and it's not tulips or beanie babies.
Baseball cards that have any value aren't pointless. They are kind of historical artifact, and are traded like artifacts or antiques. They have value as long as enough people place value on baseball history.
Newly created baseball cards are effectively worthless, and a vanishingly small percentage will ever have any value.
Crypto has no cultural value like that. There is no sentimental value attached to it.
Eventually in the future when nobody cares about it remembers what baseball is, the cards will have no value, but the fact is that value today comes from both their scarcity and the ownership of a piece of history.
"The crypto world went into a full meltdown this week"
I don't know. Look at a chart of Bitcoins price on a log scale:
https://twitter.com/JonathanBeuys/status/1524810429884661761
To me, it does not look any different then it has looked for the last 10 years. Its a slowing exponential growth with a certain volatility. Nothing seems to have changed in the last week.
Ethereum makes another quarter and looks similar.
Tether makes another 10% or so and is at $0.998.
I find it hard to imagine that whatever happens lower down on the list of crypto projects can move the needle enough so we can come to the conclusion that "the crypto world" as a whole is in a meltdown.
So they see a significant drop in price, but completely within the bounds of previous drops, and they see it as full meltdown and the ponzi scheme popping, because that fits their narrative.
On a linear scale it is hard to see.
Some are shitty, some are not.
Monero and Algorand are two good examples. The latter carbon negative.
Ironically, it is the central planning of interest rates which created an environment ripe for speculative bubbles. It is the heavy regulation of all things financial which has burdened online transactions. If not for onerous regulatory requirements perhaps cryptocurrencies would not have been popularized.
Then there are the obvious falsehoods and sloppy generalizations used to advance their argument. Not all cryptocurrencies are the same. Even if we accept their characterization of BTC as "wasteful" there are other options which are more efficient.
Their solution, predictably enough is to create more regulations and prohibitions. It is a tone deaf lack of self awareness. All the worse when they celebrate themselves as authorities on the topic.
Perhaps the interviewee is an expert on CS, but does that qualify him to centrally plan financial transactions? This is technocracy at its worst. A self appointed expert steps outside of his bounds to make wide sweeping proclamations.
Then there are the obvious cultural factors. An institutional academic favors institutional and bureaucratic control over markets, disregards the value of market consensus and individual preferences? Cultural bias and group-think or not?
That is simply not true.
As an early bitcoin supporter, my sentiment shifted against cryptocurrency as I worked with more and more companies that have been targeted by ransomware. I kept waiting to be able to pay for real things and instead I saw wave after wave of fraud, grift and extortion but no progress on being a usable currency.
> It is the heavy regulation of all things financial which has burdened online transactions.
Really? Online "non-cryptocurrency" transactions have outpaced cryptocurrency transactions by a massive amount.
Cryptocurrency was a neat idea that failed to realize it's potential due to the complexity of operations in the real world. Instead it has become a cesspit of fraud, theft and self-deluding grifters that lie repeatedly to try to bring in more and more greater fools. There are still se cryptocurrency idealists out there, but it gets harder and harder to tell them from the grifters.
Yes, really. Those transactions are heavily regulated. You cannot send a 0.000001 USD Paypal transaction for example. The overhead is too high. There are cryptocurrencies which allow these microtransactions.
Observing that there is a high amount of regulated transactions doesn't account for the demand for unregulated transactions.
Perhaps if regulations were lower, services could provide functionality which would make cryptocurrency irrelevant.
From the interview:
>WEAVER: I am holding up a Raspberry Pi computer module. This entire computer is like 50 bucks. So for 500 bucks worth of [computing power], I could do the same functionality as Bitcoin, with just 10 named entities. Why don’t I do this? Because those 10 named entities would have to follow money laundering laws. And apart from getting a structure where the named entities don’t follow money laundering laws, there’s no advantage for the cryptocurrencies, despite burning nine orders of magnitude more power.
Even the die-hard cryptocurrency hater featured in the interview admits that is the heavy cost of regulation which created the market demand for cryptocurrency. The question is if he understands the implications of his own statement and the premises from which they derive from.
>I kept waiting to be able to pay for real things...
Perhaps most people don't want to go through the hassle of doing KYC on an exchange just to buy a pizza. Also, Gresham's law and legal tender laws.
>...and instead I saw wave after wave of fraud, grift and extortion but no progress on being a usable currency.
So the remaining users of cryptocurrency are those who use it out of necessity. That could be innovation in microtransactions, online gaming, speculation or the criminal uses you narrowly focus on.
However you want to value it is up to you. Either within the existing framework of regulation or independently. If you don't like it, don't use it. Calling for what other people value to be destroyed, because Weaver doesn't like it is authoritarian. He's a bully. Live and let live.
How is that due to regulations? There simply isn't much demand for those types of transactions.
> Observing that there is a high amount of regulated transactions doesn't account for the demand for unregulated transactions.
The growth of demand for regulated online transactions has far out stripped the demand for unregulated online transactions. People LIKE fraud protection and having recourse if something goes wrong.
There is no evidence that bitcoin allows me types of online businesses to flourish (that don't depend on breaking the law.
> Even the die-hard cryptocurrency hater featured in the interview admits that is the heavy cost of regulation which created the market demand for cryptocurrency.
Yes, cryptocurrencies primary use is as a way of breaking laws.
We can debate which laws should exist, but the effect of cryptocurrency isn't to avoid only bad laws, but all laws. So unless you are the type of hypothetical libertarian who thinks all government is bad while enjoying a standard of living that is only possible in a regulated economy, supporting cryptocurrency as a way of opposing bad laws is nonsensical.
How things scale matters, cash makes a good anti-authority hedge because it is harder to scale sketchy shit with it despite the anonymity it provides. Cryptocurrency scales too well, it allows massive flouting of laws at scale while providing little additional benefit.
> If you don't like it, don't use it. Calling for what other people value to be destroyed, because Weaver doesn't like it is authoritarian
What about all the damage it has caused through incentiving ransomware? What right do you have help destroy other people's hard built value?
>How is that due to regulations? There simply isn't much demand for those types of transactions.
Perhaps there isn't demand because they have been regulated out of the realm of the possible with traditional instruments? There is demand, but you are not aware.
Tips on Twitter,
Tips on Reddit,
Tips in chats,
Tips for streamers,
Tips for bloggers,
Payouts for activity in a browser game (QuakeIII, rougelikelike or others),
Survey response,
Mechanical Turk style microtasks
These are just the few ideas that leap off the top of my head. You fulfill all of the criteria of my initial criticism, a lack of appreciation for the subjective theory of value. Just because you do not value it, are totally unaware of it, or lack the imagination to conceive of it, does not mean that the activity has no value.
http://pressbin.com/tools/paypal_micropayments/
>So unless you are the type of hypothetical libertarian who thinks all government is bad while enjoying a standard of living that is only possible in a regulated economy, supporting cryptocurrency as a way of opposing bad laws is nonsensical.
This is where you go off the rails. Consider if I had structured an argument, "Unless you are the kind of commie who..."
I realize that pro-market sentiment is something of a thought crime here on this forum for entrepreneurs, but this is a bit much. As to living in a highly regulated country, don't you think that is a bit presumptuous?
In regards to pro-market sentiments and private property, many have said, "If you don't like it, move to Somalia" I don't know if it is within your powers of imagination, but there are several better options. No, I don't need to show ID (suspicious looking? Imagine that!) to walk up the street. I never needed to show a vaccine card to buy a coffee either. Yes, I am truly suffering by not living in a highly regulated country.
>while providing little additional benefit
Who are you to say? Again, you might not value some of these things. They might not impact your life. Others may. Generalizing it into criminality is just sloppy to the point of the absurd. Although, perhaps that is a privilege for those lacking imagination.
https://en.wikipedia.org/wiki/Subjective_theory_of_value
>What about all the damage it has caused through incentiving ransomware?
>Dillinger was known to prefer Ford's then-new V8 cars for their speed.
https://money.cnn.com/2010/01/24/autos/dillinger_car_auction....
Cryptocurrency does not incentivize ransomware anymore than the Ford V8 incentivized John Dillinger to rob banks. Men act. Cryptocurrency transacts as per the intentions of men. Don't personify the inanimate by misattributing agency. Please seek help if you hallucinate the BTC SVG on your shoulder, "incentivizing" you into a life of cyber-crime.
If you think you see a way to change that go do it rather than posturing to me on the internet about a failed technology.
However, in general, I am not a big fan of banning things. I hope that the damage that cryptocurrency is causing can be reigned in without banning it, though I suspect that cross-border jurisdictional issues will make that hard. Ideally, the cryptocurrency community could come up with internal solutions to limit abuse, but that seems unlikely given current trends in that space.
Reminds me of the old adage, "crypto is the thing where those who know tech are in it for the economics, and those who know economics are in it for the tech"
(edit: fix typo)
I have to disagree with you here. Algorand requires relay nodes for consensus (and high throughput), and those relay nodes are permissioned and largely centralized.
It’s not accurate to call Algorand a “decentralized blockchain” or assets on it “decentralized assets”.
This is a big issue in the blockchain world - the details of the implementation matter so little to the participants trying to profit, that we have multiple chains in existence with centralized controls and people still think those are better than using an obviously-centralized platform. These platforms tend to have the disadvantages of centralized platforms without the protections they provide, it just isn’t obvious until that centralized control is eventually exercised.
This is supposed to be a rational reality-based community. There should be zero tolerance for the "just doesn't understand" trope, especially when someone doesn't even identify (let alone explain) what it is that their target doesn't understand. It's blithe dismissal, not curious conversation, and at least nominally (according to the guidelines) not what the site is supposed to be about.
The rare events where their use doesn't involve crime are overwhelmed by the criminal uses.
Plenty of other things are wasteful by design, like military for example. The more military things we build, the stronger we'll be. Same with BTC hashrate, the more power the stronger the network.
There have been plenty of double-spend attacks that have happened. For example, ETC has a 6.5 day deposit time on Kraken.
[1] https://www.google.com/search?q=arxiv+mining+pow
[2] https://support.kraken.com/hc/en-us/articles/203325283-Crypt...
Forked minority chains aren't expected to be safe, and this is for sure reflected in the market value of the coin. Any time ETH miners want to gang up on ETC, they can.
> We’re talking [a measurable percentage] of the world’s electricity consumption, most of that has not been paid for. So the mining companies for the most part have been taking the cryptocurrency and borrowing against the cryptocurrency that they create, rather than sell it, because the market’s actually very thin.
So supposedly, the markets are too thin to support the miners actually selling their earnings to pay their power bills. Let's check the top two against 24-hour volume on coinmarketcap:
BTC volume: 1M BTC
BTC issuance: 6.25 BTC every 10 minutes, or 900 BTC in 24 hours, or 0.09% of the trading volume.
ETH volume: 8.5M ETH
ETH issuance: 2 ETH every 15 seconds, or 11,520 ETH in 24 hours, or 0.14% of the trading volume.
I don't think the miners have any trouble selling their earnings for fiat.
However as any "money" concept rooted on "money is the value" instead of "money is just an unit of measure of some substrate" are no more scam than actual currencies, should face the same fate anyway.
This is the point of having a hardware wallet. Someone has to push a physical button in the real world to sign a transaction.
>And [ransomware] only exists because people can pay in Bitcoin.
The concept of ransoms predates cryptocurrency and would still exist without it.
>And my gain is not just the difference between what I bought it for and what somebody else bought it for, but that plus the benefit of all the dividends and interest.
Stocks aren't guaranteed to just go up. If your stocks even pay dividends that might not even cover your losses.
>So the stock market and the bond market are a positive-sum game.
The stock market isn't positive sum. Someone is going to be holding the bag when a company goes out of business.
>but [Tether] does have the potential for bank runs causing collapse, because it’s unbacked.
This is false. See https://tether.to/en/transparency/
>Tether tokens, loans them to their big colleagues in the cryptocurrency space
See the above link. Their reserves aren't made up those kinds of loans.
>The cost of a transaction in cryptocurrency systemically is the amount being used to protect it.
This isn't true. If I charge $100 per transaction that doesn't mean that $100 of that goes towards protecting it.
>So let’s do programs that cannot be updated that handle mone
This isn't true. Smart contacts get updated all of the time.
>There’s no mechanism to fix problems if they occur. There’s no undo button. In fact, there’s often no way to upgrade at all.
This is just plain wrong. You can even make upgrades which are delayed that you can potentially cancel to prevent from being applied.
"Anonymous-ish cash, but on the internet" is a very attractive proposition. I'd also add to that "Locking up your money to get more money later" is as well. So much so that I'd strongly bet in favor of "people figure out how to make it more efficient, safer, and less destructive" against "It's just going to fail and go away."
Yes, there is a very simple way of offering that. Unfortunately it's currently illegal to do so in most places outside of crypto, where all of a sudden it becomes kosher as long as you can keep it wrapped in enough technobabble.
It's from author's lecture.
I say they'll lower it again by 2024.
Plenty of different arguments are offered by the commentariat, some of which have merit. But whether the stated reasons are environmental issues, political implications, scams, ransomware, or illicit trade, the one commonality seems anger and desire to ban and destroy all crypto.
A commenter recently stated candidly that they simply feel envy. They’re bitter about their bro-type friends and acquaintances getting rich overnight and flaunting their wealth. It clicked for me that HN commenters are more likely to personally know such people and feel resentful towards them.
That may sound like ad hominem, but I’m not addressing the arguments (many of which I agree with). I’m speculating about the reasons for the disproportionate level of ire directed against crypto on this forum, and personal resentment feels like a good candidate.
The reason I even care is that I’m hoping to read (even if not always necessarily participate in) higher quality discussions on this topic. The tech is here whether we like it or not. It might fail horribly (as many here seem to be hoping), but what definitely won’t help are the “I hope this Ponzi scam dies soon” one-liners on almost every article on the topic.
And then the stuff that isn't overtly a scam tends not to make a lot of sense. Bitcoin is a wasteful way to do what it does, and things like that.
I don't personally know any people who became rich on cryptocurrencies and also don't feel any particular envy towards the people who I know of, via the internet, but am pretty vehemently against cryptocurrencies, so I'm a sample-size one counter-example to your thesis.
I obviously don't think that my ire against cryptocurrencies is disproportionate, since if I did, I'd scale it down until I thought it was proportionate, so I think that it's justified by the object-level issues.
If I were to speculate on why classes of people like me are more strongly opposed to cryptocurrencies than other people:
1. We are (or feel we are) more qualified to see many of its technical deficiencies, some of which have been patched over the years, others of which seem fundamental.
2. We agree with the "crypto people" on many topics, such as decentralisation or privacy, but think that their solutions are broken, and worse we feel that their philosophy and approach is a bit of a dark mirror universe of ours (to exaggerate _immensely_ imagine that both groups were religious people who agreed completely on matters of scripture, but they inexplicably decided to worship Ahriman instead of Ahura Mazda). See also "I Can Tolerate Anything Except The Outgroup"[0].
[0] https://slatestarcodex.com/2014/09/30/i-can-tolerate-anythin...
Thanks for reminding me to reread the Scott Alexander outgroup article.
But for me this is comparable to other forms of economic criticism. I believe that the path that cryptocurrency and related systems is walking leads to an extreme hypercapitalism where everything on the planet becomes an item for speculation and no behavior is possible without access to some capitalized token. A lot of people will get rich off that process but the reason why I think that this is bad is not because other people get rich off of it. I think it is a harmful system whether or not I get to buy a yacht.
Sorry, damn, that was Bruce Wayne.
In my experience it feels like people have more hits than misses given enough chance, even those you disagree with /shrug
> Why All Of Silicon Valley Should Die in a Fire
Just an extension of the original... and just as dumb.
Also, I get the general sentiment on this site is CRYPTO BAD, mut can we please not jam the front page with links like this? What will be the next "why all x should die in a fire"?
If they provide arguments, even (especially?) if those arguments are refutable, it might be worth reading. There's a lot to criticize about ad-supported Silicon Valley, and even VC-supported Silicon Valley. What's not worth reading is blithe dismissals - like yours - that don't make any argument at all but consist purely of tone-policing.
Cost of refutation is a related rhetorical concept. If this worthless article is going to can a few common critical tropes, all previously addressed, even by other technologies in the same space it aimed at, why should I do anything other than respond with equivalently low effort?
Because you want me to expend the resources? I thought wasted resources were bad? That's the premise of the whining after all, isn't it? Disingenuous, worthless article, preying upon stupidity, fear and moral outrage, which just happened to be filed within days of most cryptos dropping 25% in price, roughly, in the middle of a bear market.