White House Is Mulling a Ban on Bitcoin Mining
barrons.com
barrons.com
Crypto firms are among the top Democrat donors. Crypto CEO SBF plans on donating $100mil - $1bil in the 2024 election, and calls political donation the highest form of return of investment that exists:
> He was also one of just a handful of donors who spent $10 million-plus backing President Joe Biden in 2020, and in the last year, he’s hired a network of political operatives and spent tens of millions more shaping Democratic House primaries. It was a shocking wave of spending that looked like it could remake the Democratic Party bench in Washington, candidate by candidate. Looking ahead to the 2024 election, he has said he could spend anywhere from $100 million to $1 billion.
https://www.politico.com/news/2022/08/04/democratic-megadono...
Banning PoW would benefit Bitcoin; it's the main thing preventing it from becoming more popular right now. Having the government force the Bitcoin community to do what they've been unable to do themselves would be the best of all worlds for them.
The US is the second largest polluter.
https://en.wikipedia.org/wiki/List_of_countries_by_greenhous...
I mean, that would mean exponentially more expensive food…
https://news.un.org/en/story/2021/03/1086822
My take is we need to allow unlimited emissions of carbon dioxide and nitrogen (reduction in other stuff though actually toxic). It increases food growth (plants love carbon) and arable land and decreases poverty. Plus cheaper energy means improved quality of life and technological advancement.
We have centuries of known fuel sources and can move to nuclear any time we wish.
A carbon tax effectively increases human suffering for the hope of reduced temperatures. In reality, the cost is passed to consumers and there’s no indication it will reduce global temperatures.
Your take is so misinformed that we all have to wonder how you could have twisted yourself into such a position
CO2 is the primary driver of climate change and will do far more harm to these plants/crops that 'love' excess CO2 than you seem to understand.
Having worked on climate models and read many papers I have become skeptical we know the manner or degree humans have an effect.
Those with a statistics background should look at the data honestly. We have relatively poor data (very sparse, unknown error rate, high variance, measurements taken with different mechanisms, etc) that can’t be validated. With correlations abounding in every which way. We also have a precision problem when we look at global temperatures in the past, we simply don’t know when we are taking a 1-5% change in temp.
You cannot prove carbon does absolutely anything. We have a correlation not causation. It could be natural carbon increases with temperatures. It could be our measurement mechanism is just wrong. It could be plant growth will expand to meet a new homeostasis with the carbon (imo highly likely). From the same measurements we use to show the Earth is warming we can show carbon levels have been higher previously on Earth.
> CO2 is the primary driver of climate change and will do far more harm to these plants/crops that 'love' excess CO2 than you seem to understand.
North America was covered in a sheet of ice until a few thousand years ago. The largest desert in Africa was a full of life during the same time period. Both disappeared before the industrial revolution and we have been seeing carbon increase exponentially ever since; as visible in the linked website
https://skepticalscience.com/co2-lags-temperature.htm
Now once we cover that, the question is what too do? We know cheap energy directly correlates with quality of life. Easy thought exercise - is your life easier walking or driving a car? Is it easier with a wood burning stove or a gas oven?
The argument we should reduce something that we know improves life and remove it requires a high level of proof. The threshold hasn’t been met. Even if it had, is China going to cut emissions? Do you really think wealthy will? No. They won’t. China will expand and continue to produce more overtaking the US in every category - they’ll use the cheap energy we aren’t using. The US will be destitute due to us cutting all energy production. Now what? Is the world better off? Germany is doing that right now, let’s check back in a couple years and see how that goes…
My point is that (1) we don’t have solid enough evidence to reduce the quality of life in our civilization and (2) even if we had said evidence, we couldn’t meaningfully make an impact- tax or no tax. So you’ll have all the downside, with no gain.
This is probably where you get your information on CO2: https://twitter.com/CkDexter15/status/1569530162873516034
All taxes collected are redistributed back to citizens.
Best of both words - progressive taxation and incentive to develop anti-carbon tevh.
This has been enacted in Canada. If you care about the environment this isn't the way to go.
But fact is, greenhouse gases have the potential to end humanity, and the US is not addressing them enough.
But it's irrelevant, the community is already stuck in this place.
All hail the great Satoshi. Thou shalt not change but one #define.
Since Bitcoin relies on PoW, banning PoW effectively bans mining Bitcoin. On the surface, why that would make Bitcoin more popular is nonsensical, but I see two interpretations, and I’m guessing you mean the second one:
1) Banning PoW mining in the US, like they did in China, severely limits industrial-scale Bitcoin mining in another big part of the world, lowering the total mining incentive, and moving mining out to places where people don’t object to it and where electricity is cheap and in excess: this somewhat lowers the total hash rate, conflicts less with our growing energy demand in populated areas, but more significantly makes the environmental cost more abstract to people and thus easier to swallow. It’s a lot more upsetting to see a power plant down the river mining Bitcoin than knowing they come from somewhere called “the cloud”.
2) Banning PoW mining in the US could somehow incentivise towards a PoS transition, like with Ethereum. I don’t see that happening for Bitcoin. Sorry.
You have a lot to learn then because your analogy is weak. PoW vs PoS debate is one of decentralization, power, democratization and control.
As for bitcoin being dated: it’s ossification is intentional. It is, by design, a predictable and reliable monetary system.
Now that's funny!
In 2028, how many new US dollars will enter circulation? How many bitcoin?
It already happened. 10 years ago a pizza was worth how much? And how many bitcoins do you need now for one pizza?
I do suspect it will trend toward stability on a decades timeline.
Some dude though about some basic concept of decentralization and that's it.
This was not some mastermind who created the perfect money system.
There are massive amounts of issues with Bitcoin in particular.
Alone one reason why Ethereum was trying to be ASIC resistent was to make GPUs stronger and allowing for more / better decentralization.
Plenty of people who are no longer able to recover their wallets (I know two friends having lost 150k$\initial investment of 10k$).
Fraud issues like you see in El Salvador.
The huge changes in value (no Bitcoin is apparently not stable and independent from the economic market).
And it doesn't even solve the trust issue. As soon as you wanna spend Bitcoin you need other systems like smart contract (which also doesn't solve the problem) or trusting third party.
The only advantage of Bitcoin is that's unregulated and everyone is taking a bit of it who is fast enough, rich enough or smart enough from everyone else who is not.
In order for Bitcoin to remain secure, the $$$ amount spent on electricity to mine Bitcoin has to be commensurate with the value of Bitcoin purchased on the markets. Because there is only so much electricity in the world that can be allocated to mining, this places an upper bound on the price that Bitcoin can reach in the markets.
It won't happen for bitcoin. PoW is such a fundamentally intrinsic part of what bitcoin is, that a transition to PoS will never happen, nor would it be desirable for most bitcoin holders who actively believe PoW to be the intrinsically interesting invention, and PoS to simply be a slight iteration of the old system. PoW was never a fundamental part of what ethereum was, because ethereum is fundamentally just whatever Vitalik and team and their early investors want it to be.
Ethereum, or any other PoS token, isn't a real alternative to bitcoin. It's something else that covers different use cases, and I'm still not sure what those use cases are.
It would be interesting to see some real numbers on that claim. For me, much bigger would be volatile value, lack of places to spend it, weekly stories about people losing life savings because off coding errors and whatnot and just generally that it seems to be an interesting solution to a problem I don't have.
PoW is in there somewhere, but nowhere near the top.
Also Bitcoin will 100% not remove proof of work ever. The overwhelming majority of node operators would not agree to that, ever. It goes against the ethos of Bitcoin. Proof of work is part of the social contract, right up there with 21 million hard cap and users running their own nodes.
One of them (Tone Vays) even participated in the Stop the Steal marches and Jan 6 riots.
I guess that is getting close to what Balaji Srivanisan calls the network state. Different virtual states with different ideologies.
Wow. Put all the cyberpunk stuff immediately into nonfiction.
Well, he seems to be shitposting or knowingly lying, then. It says he has a $30 billion fortune currently, yet still drives a Corolla and uses his parent's Netflix account, so he apparently wasn't super rich to begin with. So unless he thinks he's going to become the world's first multi-trillionaire, there is no $100 mil to $1 bil investment that can return what he got out of starting his current business, which wasn't a political donation.
Or he means something non-financial by "highest form," as in he might actually care about the Democratic agenda apart from whether it can make him even richer or not.
Numerous startups turned $1 mil into $1 bil. But nobody yet turned $1 bil into $1 trillion. Scale matters. When you deal in billions, your expected returns are much lower.
Which is why it should be banned.
Functionally, this isn't possible. If the open method is banned, people will start using layers of indirection.
It's fundamentally a problem with democracy.
Maybe. It'll make it less effective. But it'll also make it more difficult to detect.
Why does anyone believe this?
> Why does anyone believe this?
Good laws are great. And there are plenty of them.
But passing bad laws just because "we need to do something" is worse than doing nothing.
Some people seem to think that people are like computers and “law” is the programming. No, people will continue to mine Bitcoin, or do drugs, or whatever other illegal thing up until the point where the FBI breaks down a door and some people get shot or (best case) thrown behind bars. My opinion is that laws are nothing other than a form of violence. If you support violence against people for running a computer program I don’t know what to say.
Under a majoritarian system, even if >50% claim to want a law in polls or ballots, but far-more-than-50% of the same people (or even just: the relevant targets of the law) can flout it without consequences, that's typically a bad law.
Noo it's spreading!!
Yes, powerful people flout them (Sarkozy) or find ways to pass off contributions as gifts (Fillon's suits) or use the support of media oligarchs without a direct monetary contribution (Macron, Zemmour) but overall, the end result is that there's a lot less money in politics, and politicians aren't completely dependent on the funding of industry lobbies for their election.
Same thing with political advertising. I'm seeing scandal after scandal about Facebook censoring or not censoring this or that political ad, and I'm just thinking "I'm so glad this is the kind of bullshit we don't need to deal with".
But if nothing else, we can assume that there's less money in politics because campaigns are less expensive.
Macron's last campaign cost 16 millions euros. Biden's last campaign cost 1.06 billion dollars. That money has to come from somewhere.
In theory, Macron's campaign could have hidden costs not reported in accounting (which is what Sarkozy did) but in practice it's hard to hide that (hence Sarkozy getting caught). Big campaign meetings in expensive stadiums are, by design, hard to hide.
Also, since you can't spend money getting your candidate on TV ads, there's not a huge incentive to blow up your campaign budget. Regulators also ensure that TV outlets spend an equal amount of time on each candidate. (Though there are also ways to game that, eg CNews got fined for putting Zemmour on prime time and every other candidate in night slots).
So while power games still exist (the key to becoming French president is basically being friends with Xavier Niel), we can assume there's less money overall because parties have fewer things to spend money on.
I don't think this is self-evident even for money, if the money is simply being spent in ways that can't be tallied.
It's even less assured for all undue influence, including insider networks of non-financial favor-trading – as you note in your (fairly cynical!) observation that "the key to becoming French president is basically being friends with Xavier Niel".
Is that really tangibly better than overt, measurable money influence from many competing sources?
It's possible the low (above-board) spending totals are really a negative indicator: evidence that a de-facto cartel has enough levers to repel challenges without explicit cash outlays. When spending on wages seems suspiciously low, as with American college athletes or French IT workers, it's not a sure sign evil money has been kept out of a lily-pure process, but rather that insufficient competition has kept all the real money/power with secure incumbents.
I am not an expert on French politics, but from the outside it seems just as protetive of traditional elite/insider interests as politics elsewhere. Maybe more so!
> Is that really tangibly better than overt, measurable money influence from many competing sources?
You're implying that any overt influence from political donations is fungibly replaced by an equivalent amount of hidden undue influence. That's not at all obvious.
It's not like hidden influence doesn't exist in a system with political donations. Having the support of media corporations is important in France, but it's important in the US too.
And to bring it back to the original subject, if crypto regulations were proposed in France, we wouldn't be worried that the MPs had been pre-bribed by crypto exchanges before the vote even began.
Making something illegal rarely prevents it completely, but very often reduces it.
He could just tweet how easy it is to lobby for electric vehicles and how he will spend a fraction of his money maybe a couple billions on lobbying. Maybe name a specific senate he may or may not donate to. He could specify donald trump or a certain republican senate for maximum impact.
There's no need to spend anything.
There will be a push to ban political donation immediately.
Proof of stake and other “environmentally friendly” consensus algorithms allow a select few to control the network and benefit the most from it which I suspect is the real goal here. The “environmental impact” is just an excuse.
It’s true that a large percentage of Bitcoin is owned by a few people, but at least now the benefit to them is only financial gain. Once you start to allow rich people to validate the blockchain itself, then they can begin to censor and block transactions or wallets from any individuals they deem unworthy or a threat to the powers at be.
We’ve already seen this happen with pretty much every traditional payment provider over the last few years to some extent so it was only a matter of time before they decided to come for Bitcoin.
Their real goal is to cripple and control the Bitcoin network. If they really cared about the environment they would go after energy companies or defense contractors or the banking industry who all use orders of magnitude more energy than Bitcoin miners.
As a sidenote, the executive branch has become much too powerful. They were never supposed to legislate like this. Every president since George W Bush has used extreme executive power, and no one seems to care. We are supposed to have elected representatives to legislate, not a king.
These are the same. Well, at least Wall Street. Main Street banks may be positioned against (I have seen no evidence of this), but that’s just community banks at this point. The big boys are universal.
What you’re seeing is the environmental and anti-finance lobbies allying. The fact that crypto users see Wall Street as the enemy constrains its leaders, who can’t openly ally with traditional finance on policy without looking compromised.
On the other hand, at least some people in the crypto industry care more about the other proprieties: anonymous, unconfiscatable, censorship resistant, fixed issuance/supply, free of central bank/government control, etc.
If you are correct, what reason would Wall Street folks have to be against a ban on mining?
If anything all a ban would do is enhance their ability to take control of crypto and make more money since they will be able to simply buy up the network ownership with their virtually unlimited cash. At least with POW, it actually takes some effort to buy up mining hardware, find an energy source, run the software, keep up operations, keep hardware and software up to date, etc. Much simpler to just buy up a stake and do nothing.
I managed to get into a top forging position on a major DPoS blockchain in spite of both founders and the CEO of the project hating my guts. It's not fair to suggest that it's like institutions within the fiat monetary system. Imagine being promoted as a Google executive if CEO Sundar Pichai, Larry Page and Sergey Brin all hated you; that would never happen.
That said, I think it would be dangerous to have 1 PoS blockchain with no other alternatives. The presence of alternatives is what enables any meritocracy to exist.
With PoS consensus you put up a big pile of money and validate transactions.
With PoW consensus you put up a big pile of money, turn that money into ASICs, burn some electricity, and validate transactions.
PoW seems like PoS with extra steps to me....
The stake, however, is internal to the network. Even if you have a big pile of money, there is no guaranteed that the big stake holders are willing to sell you their coins.
I think the majority of the arguments about the advantages/ disadvantages of PoW and PoS stems from that difference
It's impossible to mine anonymously with any non-negligible hashrate due to power differences and required specialized hardware - all trivial to track.
Taking over PoS is much harder because there's no way for governments to print tokens. It's easy to stake anonymously. A closed stable state in which only non-censoring validators control the network is always possible to achieve.
With PoS, although governments can’t print tokens, it doesn’t really matter. The governments and central banks have unlimited money. They control the money supply. Even if some of the top stakers won’t want to sell, they would still be able to find enough sellers who are. We have already seen how a single tweet from someone like Elon Musk can cause thousands of people to buy or sell. Manipulating the market is easy and doesn’t require permission from the people with the largest stake.
All they would need to do is float a bill that they are planning on making Bitcoin illegal and then after it is on the front page of all the news sites, when everyone is rushing to exit, swoop in and buy up the supply. I think Wall Street has already done this to a large extent. Hence, this is why I believe they are likely the ones behind this push as opposed to the people who will be hurt as a result.
All of that said, I’m willing to keep an open mind and see what happens to Ethereum after its switch to PoS. If I had to guess, I suspect we will begin to see stories of blocked transactions and blocked wallets, etc.
so they pump eth price to infinity to get majority of stake? While in theory it could work, it would cost at least hundreds of billions of dollars. Compared to maybe $1B-$2B to take over PoW from nothing. Two orders of magnitude difference.
As nobody needs a blockchain with censorship everyone else would move to a fork without the governmental stake. A very foolish plan.
If a POW miner invested the resources to take over the network, breaking the network would certainly crash the price.
However, node operators get a bigger payout than delegating your stake or staking it yourself. Overtime, this percentage difference will allow the node operators to control the network 'without breaking it'.
Btc can be minimally exploited because it doesn't do anything. POS networks are by design highly adaptive networks, with smart contracts, oracles, virtual machines and any other wonder programmers can dream up. This allows a 'soft control' exploit rather than btc's 'hard control'.
In practice, us government would pass a regulation that forces miners to register and to censor sanctioned addresses. Once they realize that miners they control own majority of hashrate, they can add a requirement to ignore chains with sanctioned addresses (from others miners).
There's no defense against this, because unlike PoS, you can't really move anywhere else. China has its own ban. Energy prices in europe are insane. Russia is sanctioned and just getting chips in is almost certainly a crime.
Under PoS as long as there's any subset of non-censoring validators a fork away from censorship is possible. Unlike mining, staking is extremely mobile globally.
What is the equivalent mechanism in PoS?
What is the 'true' hamburger chain? What is the 'true' flavor of ice cream? If less people like bacon flavored ice cream or vanilla flavored hamburgers it doesn't make them not 'true' representation of the archetype, just unpopular ones.
How should someone determine the most "popular" chain in PoS based on the chain history alone? Is it the one with the most 'staked'?
The problem (which PoW doesn't have) is that alternative versions of valid PoS history can be generated at zero or close to zero cost.
Yes.
>The problem (which PoW doesn't have) is that alternative versions of valid PoS history can be generated at zero or close to zero cost.
This is simply a misunderstanding of how it works. In order for you to propose a version of the chain that has some other history you need network consensus. If you claim something that is not true you get slashed. Thats the whole point. You can go make an entirely disconnected chain if you'd like to do that but you'll be the only one on it unless you can convince someone else to join you in your personal universe where you are a trillionare.
This leaves a problem: how should new nodes joining the network know if the version of history they’ve been presented with is ‘honest’.
The answer for Ethereum PoS is ‘checkpoints‘, but it’s not an ‘objective‘ measure, unlike ‘chain with most work’ in PoW.
Even Vitalik admits this, it is why he invented the term ‘weak subjectivity’, he is totally explicit that this is a fundamental weakness of PoS: the valid chain is subjective.
The only question that remains is whether the economic incentives that have been designed are good enough to work around this weakness and guarantee whatever properties Ethereum network users have decided is important.
It seems more realistic that the manufacturers of the most efficient mining hardware would refuse to sell it and instead use it themselves or sell to allies since that has you know, happened.
This is peanuts for a hated industry. Facebook squirrels away far more to no benefit.
After all we all are loosing the climate change game thanks to Bitcoin and co.
We all pay the price. High electric bills due to more AC usage, more demand on electricity through Bitcoin mining and higher GPU prices.
Thanks in part to Bitcoin and co. There's a mess of other really major contributors as well, and most all of 'em are filthy rich and/or giant corporate entities.
What are the associated fees and process times with sending 100 dollars with bitcoin including the purchasing and selling in order to complete the transaction of currency?
What countries does this end up being useful for?
And no I don't want to argue about pro and cons of air travel because it doesn't change the current discussion it only deflects.
This doesn't mean I'm pro air travel btw. Another weird outcome. What would you have won if I said 'yes also let's ban airtravel'?
Gotta win this climate fight.
He's donated to climate-change charities & declared FTX to be carbon-neutral.
He might even see an angle for profit in helping suppress proof-of-work!
My understanding of crypto culture is hazy, like most, but from what I've picked up: to some degree, there's Bitcoin, and there's everything else (well, there's that mistake of lumping everyone together again, but at least its more specific). Bitcoin has a weird traditionalist culture surrounding it; I once heard it described as "Bitcoiners would rather spend millions harvesting energy from a volcano than just reduce their energy needs." There's less culture of open collaboration and integration; less interest in useful utility; Bitcoin maximalists still cling on to the Digital Gold metaphor, whereas ETH maximalists have more utilitarian aspirations toward the currency/network acting like the Visa or Mastercard of a global computer, stacks of applications built-on-top-of one another, and ETH rises with the tide.
I sometimes wonder if the difference in culture has anything to do with Bitcoin's lack of a BDFL. ETH has Vitalik; very public guy, well spoken, has that fantastically nerdy & idealistic aesthetic reminiscent of early Page, Brin, Gates, and Zuck. Bitcoin has no one; and maybe that's allowed its community's more baser human instincts to manifest. Distrust, fear, greed, etc. Whereas BTC maximalists will argue that there's no perfect decentralized trust POS system, and thus POW is fundamentally necessary, Vitalik has publicly said that POS isn't perfect, but good enough.
I suggest you learn some humility from history.
If their tax collection/law enforcement interest outweighed the part of the financial sector invested in Bitcoin they would have banned it during the Russian sanctions which provided perfect cover.
Instead, after a lot of noise about banning it, they “commissioned a study” which is well known in politics as “we have to save face/pretend to do something for optics”.
Wall St wins, this train has left the station. This is coming from someone who tracked bitcoin since $0.25 and was, to my poverty, convinced that it would be legislatively squashed the second it got on the radar of DC or the Fed.
I argue that, since mining is done in the US, mining is clearly providing more value than the electricity used, since it continues.
The power use is just an excuse.
Of course, the price of electricity should reflect its externalities (i.e. greenhouse gas emissions). That way, the market could find a better solution. But the fossil lobby has got deep pockets.
As-is, currency mining is an effective means to leverage low electricity prices around the world and is very-often more lucrative than producing things we actually use to improve our standard of living. Suppose you impose carbon taxes, you'll (often) be preferentially biasing towards mining over e.g., aluminum or glass manufacturing, driving physical goods shortages. And even if the entire grid were renewables, you haven't really solved the "it's more profitable to make digital goods than physical ones" problem.
So you search for regulation that is biased against the digital currency but not against uses of energy. Maybe a digital currency transaction fee, like a sales tax, that puts a ton of drag and downward pressure on the currency? It could be huge, and it could be modulated by the energy use that any given currency represents or the CPI. Of course you have the cooperation problem; taxing the life out of a currency in one country is only modestly useful.
It's a thorny problem.
why isn't digital goods just as useful? I dont think you can just assume that making physical goods is _always_ going to be better.
Let bitcoin miners mine. tax carbon emissions from energy usage, and let the free market choose the right allocations based on prices, demand and supply. The free market works when externalities are accounted for using regulation.
why would digital goods crowd out physical ones? You're assuming some zero sum game - which isn't true in economics.
Even if there's finite available energy, it won't crowd out physical goods - people would choose to spend their dollars to achieve maximum utility, so demand for physical goods would still be there, even if digital goods grow in value.
Low value-add physical goods production decline until their price rises to be worth producing vs mining. Why make concrete or aluminum if the energy can be more profitably spent on coins? The problem is that this drives commodity inflation in exchange for more digital goods that don't actually make us more comfortable as a species.
Proof-of-work currencies feel like machinery of grey goo.
Bitcoin is a digital good that has some utility (as people pay money for it). Some people assign some sort of morality/ethical aspect to bitcoin, claiming that it isn't useful. The gist of my argument is that those claims are wrong, because utility can only be demonstrated by the person paying (aka, the act of paying for a goods is what demonstrates that goods' utility).
That's debatable
> The more money paid, the more utility that goods have.
This is just false
> The gist of my argument is that those claims are wrong, because utility can only be demonstrated by the person paying
This is quite a stretch, as any Ponzi scheme will demonstrate.
well, i am under the impression that people aren't being lied to about their purchase. Bringing in fraud in a discussion about economic value and utility isn't really helpful.
What makes something have utility? Why isn't the money paid representative of the utility (outside of fraud and crimes etc)?
what
> Bringing in fraud in a discussion about economic value and utility isn't really helpful.
But it is helpful.
> What makes something have utility? Why isn't the money paid representative of the utility (outside of fraud and crimes etc)?
Let's say you've been sold the Golden Gate Bridge. You paid a million dollars for it. Does it have any utility for you?
There are purely speculative assets whose utility only lies in speculation (that is, how much you can con the next man to extract some profit from assets you bought from the previous con man). They have zero utility outside the speculation.
There are assets that have no utility beyond short-lived novelty or bragging rights to the person who buys them such as "buy a sq. ft. of land in Scotland and get a meaningless title to go with it".
And so on.
The fact that you pay money for something says literally nothing about utility of that something.
well, you have to ask why somebody might've paid a million for it. For example, if owning the asset means you can charge a toll, then yes, it has utility, and presumably, you've done the sums and found that the utility is equal to, or greater than a million dollars - therefore, you paid for it.
> There are assets that have no utility beyond short-lived novelty or bragging rights
perhaps those bragging rights are useful to those who are doing the bragging. Who are you to say that it isn't utility? Just because from your point of view it is useless, doesn't mean anything.
> The fact that you pay money for something says literally nothing about utility of that something.
and this is where i think we disagree - i am assuming a rational actor. I assume that anyone would only pay money if they feel their spent money gives the equivalent utility, or else they wouldn't have spent it!
Which is why i said fraud is irrelevant in this argument - if you were sold what is meant to be diamonds, but only got glass, then yes, somebody lost utility. But it doesn't mean the original thesis - paying for diamonds - wasn't correct.
That's why I said, we need to define utility first. To you, all utility means is that someone paid money for it. Then I have a Tower of Pisa to sell to you.
> and this is where i think we disagree - i am assuming a rational actor. I assume that anyone would only pay money if they feel their spent money gives the equivalent utility
Yup, beacause as we all know all people engaged with Bitcoin are rational actors. Fraud is definitely not irrelevant in this argument, but highly relevant. For example, while members of a Ponzi scheme feel that their money are well spent, the real utility of that is?..
if they are lied to, then yes, they've wasted their utility. But if they weren't lied to - aka, they know full well what they're buying - then, how they feel _is_ the utility. Why is this any different than, say, going on a cruise ship that expends the equivalent amount of energy?
A transaction is not a waste just because some people (who weren't part of the transaction) believe it to be wasteful. Only those involved in the transaction can determine that metric. Regulation needs to be in place so that externalities are part of the transaction - which is why instead of stopping bitcoins, the energy usage (of anything, including bitcoin) should have a carbon tax.
That's not how any of this works.
so you have just asserted but not given any reason.
From this, it's quite obvious to infer that physical goods are more useful than digital goods, it's not even a contest.
It depends on the digital good. In order to make essential necessities to anywhere near scale of our needs requires automation. So these digital goods are an essential precursor to our physical necessities. Maybe they don't need to be produced on the scale of physical goods but every essential industry such as food, water, medicine, and shelter depends on so-called digital goods.
Entertainment is just as important to keeping society running as physical essentials.
First of all, there exists physical entertainment. For example, my family loves to play cards after a big family dinner.
Second of all, it's just not as important. Lack of entertainment will cause a society to break down over time, while a lack of food will destroy society overnight.
it's not. You are defining "more useful" using your own personal viewpoint. The truth about what is useful can only be determined by the buyer (paying money).
Ironically banning bitcoin would make mean a bunch of forks doing the same thing as monero making it useful again for more than gambling.
If the President can ban a specific, commonly used algorithm for arbitrary reasons, then we are in for a wild ride.
The plan isn't "banning bitcoin".
It's to consider regulation on high-energy usage crypto operations, and then "should these measures prove ineffective at reducing impacts, the Administration should explore executive actions, and Congress might consider legislation, to limit or eliminate the use of high energy intensity consensus mechanisms for crypto-asset mining."
It's unclear why you think this shouldn't be the Administration's role? If it is taking a significant proportion of power across multiple states and affecting power prices and grid stability it seems like it should at least something one branch of the federal government should have an interest in.
That phrase was not in OP's post, yet you're quoting them on it and then excoriating them for saying something that they didn't. They said:
>... commonly used algorithm...
Which is exactly how coins are mined! Which makes OP correct (sort of, they said "President" and not "Congress") because your own quoted comment says:
>... Congress might consider legislation, to limit or eliminate the use of high energy intensity consensus mechanisms for crypto-asset mining.
> That phrase was not in OP's post, yet you're quoting them on it and then excoriating them for saying something that they didn't. They said:
It was in their post when I responded and they edited to correct it. The edit window for my post has expired though.
Congress has delegated broad authority to the President with respect to energy, environment and financial services.
Honestly, would Congress itself even have that power?
They will probably defer to the EPA, who will make a regulation based on their suggestion. This allows them to bypass congressional oversight at least until someone very rich manages to bring the case in front of the supreme court. Extremely common unfortunately.
And also change the constitution right?
Of course it could imply that it needa to go through certain channels but no one should assume that it literally meant 'the president will now say x and now x is the law'.
We’re only talking about executive action because congress isn’t interested though.
https://www.pbs.org/newshour/economy/treasury-secretary-yell...
It's obvious that the money streams are under control of the state.
Your sentiment indicate that Bitcoin should be okay because why exactly?
The country doesn't want crypto that was and is clear since ever
And I also brought this point up for the last 5 years.crypto is solving a problem people like you think they wanna solve without understanding that it's on purpose how it is.
It's nothing to be fixed.
Crypto may be wasteful nonsense and no real solution to anything. But that no reason to ban it, when we accept that capitalism allows vast amounts of wasteful behaviour in many ways, so long as people are prepared to pay the market rate for their wastefulness.
If a government is elected with an explicit policy of a hard crackdown on wasteful energy use, it would surely have to extend way beyond crypto, and certainly affect those cooling mega-mansions and heating private swimming pools - but potentially even limit the power/performance of gaming hardware, domestic appliances, and power tools, amongst other things. But that's not what's happening here.
IMHO, the post-Covid world needs to somehow look past its tribalism and rediscover the importance of freedom in it's many forms, and also look back more critically at the Covid response and related events around the globe.
Covid has shown that there's a very high demand from an easily-terrified populace for centralised authoritarian power during a crisis. It has also shown that when that power is exercised, the resistance is likely to be minimal, and crushing that resistance causes little backlash beyond small outbursts of online anger.
We now face a perpetual crisis - the 'climate emergency'. And we should all be concerned about attempted solutions imposed by such centralised authoritarian means, and even more concerned about things done claiming to be about the climate, but actually being ideological in nature.
I think education was.
It's hard to discuss 'freedom' when people prefer the opinion of anyone besides experts.
I never ever saw meaningful discussions on covid were people were arguing certain papers and statistics.
So the state actually did what it should do: protect their people.
Yes we do need to discuss ALSO further Energie eaters.
The point here is that Bitcoin is new, doesn't add any value but in contrary is circumventing the existing and on purpose installed finance system.
Blocking Bitcoin now doesn't hurt anyone while ac etc. Might be harder to enforce.
But just to be clear about your wishi washy argument:
It's not arbitrary when they state a reason.
And it's not just some algorithm.
I'm also not sure what a difference it makes if you do something manually or a computer automatically if it's harming others you should be able to ban it.
Like the action of moving your hand very fast into the face of someone else.
Or consuming a lot of energy to guess a random text string faster than others.
Btw. You should also advocate against Bitcoin. The chance that the climate change from Bitcoin is hurting you more than the benefit of Bitcoin is very high
And if you made bank thanks to crypto, feel free to accept that jlyou only took the money you have now from others.
One way or the other Bitcoin is garbage.
And yes every crypto bro who exchanges crypto back to Fiat is not believing in crypto either.
Congress might consider legislation, to limit or eliminate the use of high energy intensity consensus mechanisms for crypto-asset mining,”
the real beneficiaries of this would be small miners (small business owners?) who either use their own locally generated power or the residential grid. oh, and all the people who don't mine in the US
the utilities know what the power is being used for
Maybe it's different in strict commodity markets but this knowledge also allows you for better cooperation. From little things like when to set service windows to large infrastructure investments for which you might want some buy-in before they happen.
Additionally, they need to know which clients to restore power to first (hospitals and essential services) and who can wait (commercial buildings on a weekend? Back of the line)
Note: it isn’t that they know exactly what the power is used for, but they sure know the general purpose (residential, industrial, critical service, tech, etc)
A basic industrial unit with a 10 kilowatt supply? They'll supply you no-questions-asked.
If you're a huge operation like a steelworks, consuming tens or hundreds of megawatts, they'll want to work closely with you for capacity planning.
If you've got special business requirements, like a hospital or data centre that needs redundant, highly reliable power - you'll have to tell them that's what you need.
If you want to negotiate a discount below their normal prices, an account manager will sniff around your company to try and figure out how price-sensitive you really are.
If you want a big upgrade to your building's power, which needs new cabling installed or the road dug up? The workers might not keep quiet if they see you're a cannabis grow operation.
First, try to imagine the form this ban would take. Think about the specific language required to abolish proof-of-work computations without kneecapping the foundations of modern cryptography. I have yet to see anything remotely specific and plausible.
Second, let's say said language can be constructed and that it threads the proverbial needle. Who cares? Its effect on Bitcoin would be to drive mining to other political jurisdictions. But electricity costs and political actions have been doing that for years now.
If anything, a successful ban would merely further distribute proof-of-work mining around the globe and among clandestine operations within countries that have "banned" it. By making proof-of-work untenable at scale, governments will have only succeeded in setting Bitcoin back on its original path - greater distribution of hash power across a greater chunk of the world's geography and political boundaries.
Trivial. Name Bitcoin and give the Treasury authority to restrict anything similar.
Like what we saw with drug prohibition, bans that can't be enforced and defy the will of a sufficient number of people tend to backfire in the form of nurturing organized crime and a general decrease of trust in the government in the population.
Good governance needs to be careful to not declare bans it can't enforce.
[1]: https://utahrivers.org/blog-post/2021/12/13/new-report-upper...
[2]: https://www.forbes.com/sites/drewhansen/2016/02/09/unless-it...
American polarism (e.g. if you suggest there’s a single negative consequence to capitalism you’re automatically a communist) is spreading at the same time. I think we should all be concerned about the consequences.
To the extent that this happens, it's not unique to a free market economy. The Soviet Union was notable for causing environmental devastation.
Theoretically, if real interest rates are sufficiently high, it might be profitable to, for example, over-fish some species to extinction, since the present value of future catches declines exponentially with time, according to the interest rate.
However, for the past few decades, real interest rates have been at historically low levels, so it's hard to see this as an explanation for any current short-sighted behaviour.
More money to the utility company does not exert a pressure for them to spend money for robustness and especially rare events.
Certainly, additional incentives should be considered to encourage more robust maintenance schedules around generation-side as well. I am absolutely for multiple options here.
I don't think this is a situation where one simple decision solves all of the problems all at once.
Switched away after $20/kWh days that wiped off a year of savings from no markip.
Increasing the cost wouldn't fix that problem.
Watch a documentary on how they created false research on purpose and lied in public.
You don't want a free market.
Let companies do whatever they want, people will decide winners and losers with their wallets.
Something tells me the general public will go for the cheapest/most profitable company and only a minority will try to do "the right thing".
Why wouldn't it be?
This makes it much harder for companies to get proper electric contracts, you can snitch on companies, you can audit them etc.
It might not be able to ban small setups but for sure makes a big dent in crypto companies. Official ones.
You are kidding, right? The United States has a outstanding history of banning things. Alcohol. Drugs. /s
[fixed weird typo]
Also, and I thought this was obvious, alcohol and drugs are either more fun and popular or more fun and addicting. That combination of wide and deep makes them insidious and sympathetic. Bitcoin is neither.
Most drugs aren’t paid for with crypto for the same reason most of anything isn’t paid for with crypto. For the religious, there’s PoS.
This is also true of gummy worms and sea snails. Nobody argues against its possibility. Simply that for drugs, people will find a way. There isn’t a similar widely-held motivation for crypto.
...but we seem to be talking past each other somehow.
Everything traded is worth money. Just because something can be exchanged for money doesn’t make it as desirable as drugs.
Once PoW is illegal wheels will start turning and it'll become impossible for larger miners. If that tamps down the energy usage enough the gov probably won't bother chasing down smaller players.
Or KYC controls could make it impractical to use PoW coins outside black markets.
They could seize assets of miners big enough to need specialised energy deals, which would get rid of 90% of mining in the USA.
They could crack down on exchanges banking in USD, which would get rid of 90% of mining worldwide.
Stopping a single person running an algorithm on a single ASIC in a home environment is the impossible tail-end. I don't know if they even care about those, I'm not too worried about them.
As much as advocates tout crypto as being extra-governmental, it would honestly take very little to effectively cripple crypto. For example, a ban on financial institutions that want access to the US financial system from dealing in crypto.
When energy becomes a sufficiently important political concern it’s going to be a huge problem for PoW crypto.
Throw a solar panel array up, maybe a wind turbine or hydro?
Instead of Bitcoin just consuming energy and producing hardware garbage Asics and consuming chip capacity, let's also eat it solar panels which could just create normal energy for non Bitcoin use.
Bitcoin is not becoming green just because you use renewable energy.
If we replace fossil fuels and there is spare energy left, fine. Until then is crypto really a reasonable priority?
If it's widely believed that monopolies are bad, why is this proposal to support the government money monopoly good? Governments that are inflating their own currencies to hell and impoverishing their own citizens are trying to FUD and diminish a potential competitor that cannot possibly be hyperinflated.
The suffering and human misery that is going to come from government destroying the currency with no alternatives available is far worse than even the worst climate change doomsday predictions.
These charges of open lawlessness in tax evasion and money laundering, largely by millionaires, is why we see popular support for such measures.
Also, a ban on proof of work is far from a ban on cryptocurrency, web3 or DeFi.
Someone claiming “technical impossibility” in banning mining implies the government can’t catch them mining illegally. Most criminals don’t pay tax on their gains.
I think my statement is pretty correct. Short of something like cutting off power or global communication, you can't really technically prevent Bitcoin mining by decree.
Of course, anything that exists in physical space can be jailed/shot/seized/destroyed, so your statement is also correct. Goody.
> Most criminals don’t pay tax on their gains.
It goes without saying, but somebody who doesn't pay tax on their gains is considered a criminal by our system.
PS: I don't want to get into a mind-reading session with you, but your beef seems to be with rich people who you consider to not pay enough taxes. That is a wholly separate issue from whether or not Bitcoin mining is "allowed" or not.
Same way we can’t prevent terrorist financing or bribery. But we can fight it. (Drawing a functional, not moral analogy.)
Consider how the public might receive a terrorism financier or bribe broker arguing that these can’t be perfectly enforced and so should be made legal. That’s Bitcoin’s image problem.
> anything that exists in physical space can be jailed/shot/seized/destroyed
This is my point.
2) You're under no obligation to do so, but I hope you consider my moral question up above. The human misery and suffering that comes from a crashed currency is a repeatable and verifiable phenomenon through history and far worse than anything that could conceivably come from climate change or tax evasion. Why is it so scary to have some potential alternatives available?
My point was never tax evasion. It’s that saying Bitcoin can’t be banned implies acceptance of breaking the law via money laundering and tax evasion. What I said would be true if every crypto holder today paid taxes or none.
> Why is it so scary to have some potential alternatives available?
The alternative is causing clear and present harm. This only contemplates a PoW ban. That seems reasonably constrained. (Crypto protects against currency crashes as well as the British pound. When Argentina hyper inflates, its population is no less unemployed for having the dollar.)
2) We're probably going to disagree sharply here, but I don't believe that climate change is causing clear and present harm. And if it was, nuclear energy is the solution to it, which many environmentalists desperately reject to the point of destroying their countries. I can't take climate change peoples' ideas seriously when they reject the only workable solution to the problem they claim will cause great harm.
3) PoW is a proven system that has been proven to work, no pun intended. PoS solutions are extremely interesting, but have security and centralization concerns and have not been proven as workable in the same way as PoW. Going from PoW to PoS is not necessarily a magic solution for anything and might ruin something good for humanity. Maybe Ethereum pulls it off and there's no long-term changes or problems, but nothing has been proven yet.
Fair enough. Though by that definition, hardly anything is technically banned. Many things simply practically are.
Catching people mining is as simple as imposing KYC on UTXOs moved to exchanges and looking for miners with US IPs. (They can use a VPN to mine, but with China already banning mining and more countries to follow, VPN choices will diminish.)
I think this is good.
Whether or not blockchain is a good thing, it's very clear that proof-of-stake is an adequate and energy efficient alternative.
Most L1 chains outside Bitcoin and Ethereum use PoS or variants of it.
For example Solana, Cardano, Polkadot, Polygon, Avalanche and NEAR all are proof-of-stake chains.
Ripple has another non-PoW mechanism too.
ETH Mainnet is due to replace PoW by PoS by merging with Beacon Chain this September: https://ethereum.org/en/upgrades/merge/
People will attempt to run slashers against the regulated stakeholders because they're not doing their job right and just kind of hope that in a system that only works because wealthy people would refuse to lose money otherwise; that the wealthy people would be willing to lose money.
So the rich regulated forks will say fuck you and a fork will be the only solution that schisms the chain into a regulated fork where the rich people maintain a truth hat they've never done wrong and a non regulated fork where they have. People like off ramps to actual dollars so the regulated one will retain value while the other one drops rapidly. Stakeholders that think its cool to help people dodge sanctions will just lose their stakes by means of PoS because they're not maintaining "The Truth" in the regulated fork that they don't approve of and by declining market value in the fork that they do.
And in one glorious moment the PoS ecosystem will kick out all the decentralized dreamers
Even after the Tornado Cash sanctioning, people in the blockchain space designed simple mechanisms where validations can't censor transactions to/from specific entities because they won't know what any individual transaction does.
To meet your prediction, some rich group would need to launch their own network and make code changes to support the features they need. I think the wealthy who were going to do that would just start a private "smart contract" that can run code and make transactions on a centralized, non-blockchain system.
There's no reason they'd need to keep running a blockchain if they were going to centralize decision making.
This would have an impact on the price of the PoS coin, for sure, but it would still pale in comparison to the physical costs of trying to compete as a miner. Not just capital expenditures for hardware, but operating costs as well. Buying a PoS coin is all that one needs to do in comparison.
Coins that start without PoW have one entity holding 100% of supply that other people need to buy from them, leading to terrible wealth concentration.
All those grow lights use a lot of power. That is detectable, and I'm certain that a surveillance society like China would have a much easier time detecting it than we will.
All those plants use water. Also easily detectable.
There will be more heat created by all those plants. Easy to see with a drone.
Merely buying all the supplies exposes you to police suspicion.
Do people still do it? Yes, but they're now the mouse in a cat-and-mouse game.
If the US government came out with legislation strongly in support of bitcoin, they trade for the upside just as easily.
And there's much more money to be made on the upside than the downside. And it's probably much safer to make the upside bet, because a) the PoS market is very dilute and contested, so there's no clear winner to bet on unlike the PoW market and b) you can ban bitcoin or PoW in the US, but the US can't control how other parts of the world treat it, which means you don't know exactly how the globally driven price of bitcoin is going to go based on the actions of the US alone. Down for sure, but not all the way to zero.
Hell, we can see what happened when China banned PoW mining. Price went down temporarily, and then it roared back up.
Assuming there's still a civilization and computers at that point, which seems to be a bit up in the air to me (although not because of bitcoin, because of several environmental tipping points we're reaching[2]).
[1]: https://www.investopedia.com/bitcoin-halving-4843769
[2]: https://www.theguardian.com/environment/2022/sep/08/world-on...
Producing more energy means more CO2.
Even producing more solar panels creates more CO2.
The problem is CO2 and climate change. your and mine climate change.
It will cost us less to avoid producing the mass amount of energy for Bitcoin than trying to make it real CO2 neutral which is very very far away
How do they plan on doing it?
Could a president similarly ban computer games? Or (computer accessed) porn?
Greater good for society would be a good reason. Climate change laws as well.
You can't buy lead paint anymore as well.
Why do you assume a country can't create new laws?
There is also no logical base system which would only allow certain laws to be allowed.
The elite will still be able to enjoy private jets and superyachts, though (How else would they travel to climate conferences?)
If they want to get something done, and some interpretation of the law or constitution allows it, they go with it. If a court finds it unconstitutional they regroup and try again, but their M.O. appears to be act first and let the courts decide later whether or not it was something they were allowed to do.
Both sides do and allege this. From violating confirmation norms (that were always just norms) to breach of decorum in executive authorities (that were always there if seldom exercised) to outright illegality that gets struck down by courts.
Congress delegated sweeping authority to the executive via rulemaking (which enables lots of blue team chicanery) while the Federalist society’s broad view of executive power (which enables lots of red team chicanery), together with a series of Machiavellian Senate leaders, from Reid to McConnell, did this.
That’s the White House saying you cannot run a piece of software. The enforcement mechanism would have to be so extraordinarily heavy-handed, and probably violate civil rights. It would take an act of Congress to stop mining, and this administration can barely tie its own on shoes.
The anti-cryptocurrency movement isn't ignorant, it's mendacious and cynical as I'm begining to think they really appear to imagine on a psychological level that everyone else is their subject. This regime uses ideology as a kind of mass neutralizing force where almost everyone is speaking in elliptical gibberish, and even principled people get tarpitted by challenging it, and then a small number of activated people encounter no resistance to locking down the means of production (energy, currency, etc), making them impossible to dig out. A bitcoin ban isn't merely stupid, it's a meta-evil level attempt to sabotage the development of our entire species and secure the reins for these activated few. If that sounds like a conspiracy, consider how many people work directly for the Whitehouse, and it's less than a couple of thousand, with a core policy group of fewer than a couple of hundred, working playbooks provided by their party, which is a machine for working ideological playbooks. Some of the same would be the case with the other team, but this particular playbook I've seen before. I would consider a ban to be an attack on the private economy.
Proof of work is the most wasteful way of doing so. It creates an infinite race of seeing who has more compute, as it actively rewards those who consume more energy.
You’re seeing things that aren’t there in both sides of the argument. I have no idea what the last few sentences are supposed to mean, but bitcoin dying is not the end of the human species, that’s just silly.
The crux of bitcoin is sound money tied to compute costs - which directly are energy costs. It rewards people who find and apply sources of energy they can convert into compute wherever they may be. I've found some people say they don't understand things when doing so would create a conflict with their ability to sustain dissonance. My comment wasn't for them, it was for people with the need and ability to understand the macro dynamics of the policies that impact us all, and that there is a view that is upsteam of all this anti-crypto hysteria.