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Comment by atherton33 | Hacker News Reader

Does that mean Bitcoin has just doubled its energy waste?

Energy requirement is constant, reward is halved. So smaller players get out and bigger players benefiting from ASICs and economy of scale will stay.

Usually after these events the energy usage of the network decreases temporarily for ~60 days and then settles to what it was before. [0]

[0] https://www.cnbc.com/2024/04/19/bitcoin-just-completed-its-f...

How is it going to keep itself decentralized if the smaller players get out every time there's a halvening?

If you have cheap electricity and a $5,000 AntMiner you can mine profitably. I would expect the halving to push out those who have more expensive electricity, not necessarily the smallest operators.

Assuming that miners are rational actors, the hash rate should settle at a point where the expenses to mine a block (energy, hardware depreciation, etc) equal the rewards (block reward and fees), so, if the price of BTC and the fees stay constant, halving the block reward should reduce energy waste.

Conversely, energy waste is proportional to, the BTC price.

Energy waste could also be reduced by instituting a global tax on Bitcoin mining. The cost to miners would remain the same (because it's still equal to the rewards), but a part of what would be spent on wasted energy is now spent on taxes instead. Unfortunately this is highly dependent on avoiding tax cheating.

Just BTC mining? Not all uses of energy? It makes more sense to do a fossil fuel tax, which penalizes all activity that doesn't justify its environmental cost, as opposed to playing whack-a-mole with whatever uses are least popular right now.

Crypto mining is unique in that the absolute consumption provides no benefit at all. The "work" consists purely in demonstrably having spent a certain amount of value, and the energy is purely an unit of accounting. So if you could manage to make this unit more expensive for EVERY miner, the accounting system would work as before, the safety properties of the system would be unchanged, and less energy would be used.

I can think of no other use of energy where this situation holds.

You'd get that same benefit, and reduce numerous, non-obvious wastes of fossil fuels with a carbon tax.

The energy use didn't significantly change, and the value it creates for humanity didn't significantly change, so probably not?

No, the energy expended and the value it provides to the Bitcoin network is unaffected. The only change is that the inflation of the token decreased.

Not really, it just means what it means: a block rewards 2 times less than before. What happens regarding the number of miners growing or shrinking depends on a lot of factors. If you're so sure it's gonna increase the mining power, then I suggest you invest in it right now.

Hopefully it means waste goes down as more miners become unprofitable and shutdown.

Waste is constant in this context.

Yes.

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