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China says it wants to eliminate Bitcoin mining (reuters.com)
288 points by sjcsjc 15 days ago | hide | past | web | favorite | 312 comments



Good. There are few things more wasteful in energy and minimal in doing good for the world. Widespread bitcoin adoption would be catastrophic for the Earth and climate change efforts [1].

[1] https://www.nature.com/articles/s41558-018-0321-8


No, Bitcoin won't raise global average temperatures by 2°C. This Nature article was debunked by other researchers. I too was asked to review it (recently, post-publication) and the gist of what they did wrong in their analysis is:

* They overestimate (probably by 3x-5x) the present power consumption of miners because they assume the distribution of types of mining machine is homogenous in this table: https://github.com/moracamilo/Bitcoin/blob/master/Randi_Tabl... (when in fact 60-70% of the mining power comes from a single row in this table: Antminer S9). This error causes their calculated average efficiency (J/GH) to be much overestimated as their dataset contains mostly inefficient obsolete ASICs

* They overestimate future power consumption by ~50x by assuming it grows linearly with the transaction rate (in reality it doesn't). Power consumption grows with miners revenues, proportional to {block rewards + transaction fees}. Fees account for currently ~2% of revenues (average of last 60 days). Rewards decline over time, so that fees will eventually account for close to 100% of revenues, which will happen on the authors timeline of 100 years. So if fees per transaction remaimed constant, we could see a 50x tx rate growth with no increase of power consumption.

* They assume the proportion of CO2 emissions per kWh never improves over the next 100 years (great progress of renewables coming to a sudden stop?), and that Bitcoin consumes more fossil fuels than what the entire world currently consumes (infinite fossil fuel reserves?). It is not unrealistic to imagine the proportion of CO2 per kWh could be in a century 20% of what it is today.

Overall, these errors combined mean their scenario overestimates CO2 emissions by a factor of about a thousand: (3 to 5) x 50 ÷ 20% = 750x to 1250x

Edit: simplified bullet point #2


You're quibbling over details: The point is that bitcoin is deliberately designed to waste as much energy as possible. It's a constant arms race where you have to keep escalating your hash rate, or you risk somebody else being able to execute a 51% attack.

It's an absolutely atrocious example of the Red Queen effect ("running just to stand still") and I can't believe that technologists who in other contexts value elegance and efficiency can defend bitcoin with a straight face. I can only assume they have a lot of money tied up in bitcoin, because otherwise it makes no sense.


"You're quibbling over details"

CO2 emissions being wrong by a factor of a thousand is a "detail" to you? ;) My point is that the impact of proof-of-work, although real, is grossly exaggerated and appears to be more manageable than what eye-catching press titles suggest.

Another example: journalists like to claim Bitcoin emits as much CO2 as an entire country. But in fact current emissions are comparable to what a single city like Cape Town emits (28 MtCO2/yr.) Thus these sorts of statements are not so much a testament of how much Bitcoin emits, but more a testament of how little CO2 these countries emits.

"designed to waste as much energy as possible"

It is designed to use no more than what the revenues (fees+rewards) allow to purchase.

But instead of debating how big or how small Bitcoin's energy use is, I think a more intellectually interesting debate to have is whether or not Bitcoin is useful to society, and whether or not its utility justifies the costs.


Thanks for taking the time to point this out, especially since you're swimming upstream.

> I think a more intellectually interesting debate to have is whether or not Bitcoin is useful to society

Exactly.


I don't think it's at all useful to society conceived of as the best a society could be, but there's no doubt it's useful to capital. Either way, I'm not sure if merely being useful to society is sufficient to justify that level of energy usage.


Bitcoin is censorship-free, permissionless money. It is sound money (the single soundest money ever conceived) and this allows for an age of monetary freedom where citizens are no longer forced to fight an uphill battle against centrally planned 2% inflation that is gradually transforming the working class into a position reminiscent of indentured servant.


> I think a more intellectually interesting debate to have is whether or not Bitcoin is useful to society, and whether or not its utility justifies the costs.

I honestly don't think it's an interesting debate. It's been done to death, and neither side will ever make any headway in convincing the other.


Not sure anything regarding Bitcoin hasn't been discussed to death.

In this case, perhaps because there's no easy yes/no answer to it. I'm an opponent of Bitcoin and cryptocurrency in general. I find the environment important. However, I can attest there are valid use cases for cryptocurrency. I don't think there are valid use cases for me (a European utilizing the EUR who's not interested in tax avoidance or buying illegal utilities) though. So for me cryptocurrencies are not only irrelevant, they're harmful.


Not sure if you are aware, but not all crypto is based on proof of work (mining). There are other algorithms that don't waste tons of energy and still provide the benefits of crypto. Also, they can be useful for things other than tax avoidance and illegal utilities.


Excluding the use cases of tax avoidance and illegal utilities how is it more useful than EUR? They're all more volatile / less stable than EUR.


You can’t generally send EUR anywhere in the world for free in seconds. You can’t pay for things in EUR with 0 fees. There are some crypto’s that can do all of those things.

> the Red Queen effect ("running just to stand still")

It would be good if it were actually and deliberately properly designed this way to create an arms race of "who can get more general-purpose computing power for less" because it would accelerate technology development with this Red Queen effect...

Unfortunately they've missed the "general purpose part" - most mining todays is done by special-purpose hardware made for mining only, and improving it is generally useless for CPU / GPU / TPU design.

I'd fully support a similar coin that would be mine-able on GPU / TPU / other-general-matrix-multiplication-hardware because it would lead to a race decreasing the price of hardware that can run large neural networks :)


Yeah, if it were designed in such a way as to incentivize general purpose computing, or to reward producing the results of some useful scientific or mathematical computation, then I would be less appalled by it.

As it stands, brute-forcing SHA256 on ASICs is just a travesty.


there are lots of coins with algorithms designed to resist ASICs. Bitcoin just isn't one of them.


There is a downside to designing a mining algorithm tuned for general purpose CPUs: anyone with access to a lot of general purpose CPUs (such as botnet operators, or government groups) can easily aim their existing resources to try to do 51% attacks against the cryptocurrency.

If the mining algorithm requires specialized hardware, then no group starts out with an existing advantage. If the NSA decided it wanted to 51% attack a cryptocurrency, they'd have to make a massive investment in their own hardware, and then that hardware can't be repurposed after the attack. A 51% attack is likely to devastate the value of a cryptocurrency, which also de-values any mining hardware built for it, which naturally discourages anyone who invested in mining hardware from attacking the cryptocurrency.

Though mining algorithms that require specialized hardware also come with their own downsides: the companies that invest in making the mining hardware early on could decide to keep the most advanced mining hardware for themselves and gain a lot of control over the network.


Well, you need to spend some sort of resource to ensure the integrity of your money supply.

The dollar is backed by a few million troops. Bitcoin is backed by a few million tons of coal.


And armies. Why doesn't some gang just march into a few of the big hydro-powered ASIC mining centres and take over control, thus enabling them to steal all the bitcoins. What prevents that? The armed power of nation-states to enforce a generally-agreed order on societies.


> thus enabling them to steal all the bitcoins

Just FYI, a 51% attack doesn't allow you to "steal all the bitcoins"


All that would accomplish is taking control of the revenue generated while they are in control. If the big mining centre is working with private keys that are unknown to the operators, then they would not be able to spend the coins previously mined. If they gain control of more than 51% of the hash rate in this way, they would be able to censor transactions or reorg the chain. That would still leave most of the blockchain in tact. A deep reorg might even get forked away from by the rest of the network, leaving them alone in a situation analogous to Ethereum Classic.


That's a pretty roundabout way of thinking. Plenty of countries have troops but an unstable currency (e.g. Venezuala). Plenty have a stable currency but no significant troops (e.g. Iceland).


Militarily robust sovereignty is necessary but not sufficient for the integrity of a fiat currency.

Governments such as Iceland borrow military power through international agreements.


Robust against what?


Threats to national sovereignty such as invasion.


I don't really see how protection against invasion helps you maintain a fiat currency. I don't think an army is either necessary or sufficient. These just seem like two different issues.


Do you have an example of a nation failing to repel an invasion yet maintaining the integrity of its currency?


You're shifting the goalposts. Lack of protection against invasion doesn't mean you're going to get invaded. Maintaining a standing army isn't protection against invasion either.


Do you agree that if a nation is successfully invaded its currency will lose its integrity?

Do you agree that defense against invasion requires an adequate military or agreements with nations with adequate militaries?

If we agree on those two claims, it seems we must agree that militarily robust sovereignty is necessary but not sufficient for the integrity of a fiat currency.


No thats actually the right way to think about this. Externalities are often misinterpreted to only include a few layers of abstraction when in reality its a much more complex and multilayered discussion and include both positive and negatives.


i thought one of the features of bitcoin was that mining would eventually become too computationally expensive -- because the total number of bitcoins is fixed. so at some point, mining does not produce coins and you're only mining to process transactions. so isn't there a plateau somewhere, relative to the throughput of the network? nb: non-expert here


Based on limited knowledge, once all the coins are mined, I think the miners then compete for transaction fees only.

>mining would eventually become too computationally expensive

I don't think that's true, the difficulty adjusts every two(?) weeks based on the hashrate.


It's not quibbling over details. Bitcoin miners often place their mining farms near power plants and consume electricity that would've been wasted otherwise. A lot of it comes from renewable sources.

At the present moment network users are collectively paying about $700 000 a day in tx fees, so clearly the network itself creates value.


> consume electricity that would've been wasted otherwise

[citation needed]

But even if that were true, it would be disincentivizing the deployment of grid-scale storage technologies, so still hurting the battle against climate change.


It seems there are no grid-scale storage technologies that wouldn’t already be integrated into the current designs. Hydropower dams are ones for example. Engineers are not stupid.


I am really curious about the points you make in your post.

> This Nature article was debunked by other researchers.

Who are these other researcher? Care to link to their research on this?

> when in fact 60-70% of the mining power comes from a single row in this table: Antminer S9

How do we know that?

> It is not unrealistic to imagine the proportion of CO2 per kWh could be in a century 20% of what it is today.

Again, how do we know that?


> Who are these other researcher? Care to link to their research on this?

When a bitcoiner says something is "debunked", what they mean is that someone wrote a post on Medium. In this case, it's an investment banker who put some money into electricity companies before he put money into Bitcoin: https://hackernoon.com/the-reports-of-bitcoin-environmental-...

Digiconomist's response: "Verify, don't trust" - he shows his working. https://digiconomist.net/verify-dont-trust/


"Who are these other researcher? Care to link to their research on this?"

It takes months to write, peer-review, and publish research papers, so given that this Nature Climate Change article is quite recent at the moment there exists absolutely zero peer-reviewed studies or counterstudies following up on it. However here are some researchers who have criticized it in their own informal analysis or press interviews: see links in https://is.gd/ksyKyv — shortened URL for https://thinkprogress-org.cdn.ampproject.org/v/s/thinkprogre...

The researchers in question are:

Dr. Jon Koomey, who was a Lawrence Berkeley National Laboratory (LBNL) scientist for more than two decades.

Professor Eric Masanet, who leads the Energy and Resource Systems Analysis Lab at Northwestern University.

Arman Shehabi, research scientist at Lawrence Berkeley National Lab.

And myself who has criticized it here on HN (my work's been cited in Nature Sustainability and the NYT: http://blog.zorinaq.com/bitcoin-electricity-consumption/ so I guess this makes me a researcher now)

"How do we know that?"

It's common knowledge to anyone in the industry that the Antminer S9 is by far the most popular Bitcoin mining machine. For some official reports on that, see market research reports and IPO filings from multiple mining hardware manufacturers. For example this has been neatly researched and presented by the team lead by Christian Stoll in https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3335781 Read their Supplementary Data, tab "3.4 IPO filing analysis"

"Again, how do we know that?"

As I said elsewhere in this thread, according to https://www.hsdl.org/?abstract&did=801297 CO2 emissions per kWh have already decreased -25% over 11 years. Therefore -80% in 100 years seems easily achievable (the trend only has to continue for 60 years, then there can be 40 years of technological stagnation.)

In fact we don't even need any technological breakthrough to achieve -80%. France already emits 90% less CO2 per kWh than the average country, thanks to nuclear power.


> It takes months to write, peer-review, and publish research papers

So, there are no peer-reviewed, published research on this? Good to know.

> It's common knowledge to anyone in the industry that the Antminer S9 is by far the most popular Bitcoin mining machine.

Most popular can mean 30% or even 70% of hash rate. How do we know it is 60-70% as you claim?

> As I said elsewhere in this thread, according to https://www.hsdl.org/?abstract&did=801297 CO2 emissions per kWh have already decreased -25% over 11 years. Therefore -80% in 100 years seems easily achievable (the trend only has to continue for 60 years, then there can be 40 years of technological stagnation.)

To actually do a comparison, what exactly was the efficiency achieved in last 100 years? Because it looks like you are drawing the same line assumption which the paper does regarding transaction fees and power growth.

> In fact we don't even need any technological breakthrough to achieve -80%. France already emits 90% less CO2 per kWh than the average country, thanks to nuclear power.

And how much of the hash rate does France generate? Or how much of China's energy in the future is going to come from nuclear power (assuming they remain the country with largest hashrate).


"So, there are no peer-reviewed, published research on this?"

They are coming. At least one counter-study should imminently be published (I am one of the reviewers.) I am sure more are coming. Patience :)

"How do we know it is 60-70% as you claim?"

As I already said: this has been neatly researched and presented by the team lead by Christian Stoll in https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3335781 Read their Supplementary Data, tab "3.4 IPO filing analysis" This dominance of the S9 is actually a point where all market researchers unanimously agree on. I am surprised you seem to think it's a contentious point.

"Because it looks like you are drawing the same line assumption which the paper does regarding transaction fees and power growth"

Not the same line. The researchers assumed tx fees represent as of today 100% of mining revenues when it's really 2% and they extrapolate from here (gross overestimation). Whereas I'm assuming the current CO₂/kWh trend slows down (underestimation).

"And how much of the hash rate does France generate? Or how much of China's energy in the future is going to come from nuclear power (assuming they remain the country with largest hashrate)."

My point was that all we need is for present-day nuclear technology to be adopted by a good proportion of electricity generators over the next 100 years, and this would easily reduce CO2 emissions per kWh by 80%.

You ask a lot of "how do we know that", but the same question applies to your position: "How do we know there will be zero CO2/kWh improvements over the next 100 years?" "How do we know the market share of the Antminer S9 is 1/62 = 1.6% (because there are 62 rows in https://raw.githubusercontent.com/moracamilo/Bitcoin/master/...)?" Neither you nor these Nature Climate Change researchers provide any justification, whereas I do.


> by assuming it grows linearly with the transaction rate

That’s a reasonable approximation. Over time mining is paid for by transaction fees in a competitive market. If you get 2x the fees and the cost to mine stays the same, you get 2x as much mining.

Granted that assumes transaction fees are ~1:1 with transaction count. However, protection from a 51% attack eventually requires 1:1 increase in mining as the value of a 51% attack increase, so the lower bound is there.


Mining would scale with the transaction fees, but there is no reason to assume that transaction fees alone would match the current block reward. We don't need the amount of mining we have now just to defend against 51% attacks.


That depends entirely upon how motivated an attacker is and how many blocks organizations wait for.


"That’s a reasonable approximation"

No, because the authors don't understand how miners gain revenue. For every dollar of miners revenues, currently $0.02 come from tx fees and $0.98 come from the block reward (12.5 BTC today.) Therefore with everything remaining equal (same average fee per tx, which is the authors' assumption), if the tx rate grew 50x it would increase miners revenues to $1.98, hence only doubling revenues and power consumption.


It’s got a fair amount of volatility. The Reward (last 24h) 1,688 + 115.2 BTC https://bitinfocharts.com/bitcoin/ So, 115.2 / ( 1,688 + 115.2) = 6.4% not 2%.

However, looking at historical data the current fees are well below the cap. https://bitinfocharts.com/comparison/bitcoin-transactionfees...

Now, currently Bitcoin can’t scale transactions so extrapolation is kind of up in the air. But, in practice if it’s going to survive it needs to create value to offset the cost of mining.


Like I said in my top post, 2% is calculated from the 60-day (not 24-hour) average.

True, we will never be able to extrapolate future fees. I'm merely pointing out the authors did it in a way that is completely bogus.


* They assume the proportion of CO2 emissions per kWh never improves over the next 100 years (great progress of renewables coming to a sudden stop?)

I mostly agreed with the first two bullet points, but please show me a significant country that managed to reduce their CO2 emissions with renewables.

For instance, in China, where a lot of Bitcoin mining happens, the share of renewables increases in many countries, but not even as fast as the actual consumption by the population, leading them to open more coal power plants as well.

I'll wait until I see it.


The US led the world in overall reduction of CO2 emissions in 2017 mostly due to the deployment of cheap renewables with an overall reduction of 0.9%.

https://www.eia.gov/todayinenergy/detail.php?id=36953


No, it was mostly due to shale gas, not renewables.


I am not an expert on that field, but reading this I would say that Germany has reduced CO2 emissions:

https://www.umweltbundesamt.de/daten/klima/treibhausgas-emis...

Renewables are the biggest increase in new power supply in Germany.


They havent and they increased the cost of electricity. You need to factor in what they get from other countries too.


the increase of electricity cost was because of 20 years of high subsidy of renewables. The 20 years are ending soon (1-2 years) for the first who got those subsidies in the year 2000. Gradually electricity cost should become cheaper again, as the subsidy has become low enough (maybe in 10-15 years).

Improvments in renewable technology should make renewable energy cost effective even without subsidy (at least the newer ones).


I would love to see any evidence that renewable energy is cost-effective on any relevant scale. The true cost of solar and wind both with regards to externalities and actual cost is much higher than the current politically and marketing driven claims.

The number of misleading claims when it comes to the current state of batteries the cost-effectiveness of wind and solar etc is staggering.

Don't forget calculating the price and consequences of ex CO2 of wind and solar does not include things like true cost of production (the entire vertical stack), decommission, the fact that it makes other energy types more expensive (like coal used ex at night when the sun don't shine), doesn't include the cost of digging for rare-earth materials etc.

Don't forget that solar and wind require huge areas to work because the density of wind and solar is so low compared to nuclear, oil or coal.

Sun and wind combined cover less than 1% of the worlds energy needs. The high percentages some claim like when Denmark claim 40% comes from wind are misleading as they only compare to electricity, only talks about the energy that's produced in the country (an excludes energy imported for ex when there is no wind)

There is so much disingenuous information out there it's quite astounding.


France emits 90% less CO2/kWh than Germany (they didn't even need renewables to achieve that, just nuclear): http://environmentalprogress.org/big-news/2017/2/11/german-e...

And according to https://www.hsdl.org/?abstract&did=801297 CO2 emissions per kWh have already decreased 2.58%/year between 2005 and 2016 (-25% over 11 years). That's already far better than the 1.60%/year I assumed (-80% over 100 years), further strengthening my point that these Nature authors' assumption that CO2/kWh will never improve in 100 years is utterly unrealistic.


In the US, that was mostly due to gas replacing coal. France is not using renewables. This is great, but not due to renewables as you initially claimed. Also, I don't think the share of bitcoin mining is significant in these examples.

I was asking for a country that managed to reduce their CO2 emissions significantly with renewables. It may happen in the future, and I'm certainly hoping for it, but we don't have a large-scale concrete example yet.


I initially mentioned renewables as just one way to achieve CO2 emissions reductions. Nuclear is another way that works just as well.

"we don't have a large-scale concrete example yet"

China single-handedly added 230 GW of hydropower in 10 years (2006-2016). This could power the entire country of Japan (5th biggest electricity consumer in the world). If this isn't "large-scale" enough for you, I don't know what is ;) China also added a ton of fossil fuel power plants in that same period, but still it shows at least hydro, as a renewable, can work at very large scales.


France who uses nuclear.


Nuclear is not generally seen as a renewable is it? It’s a really efficient extraction based source.


Its plentiful and its greener than both wind and solar. Furthermore i am assuming the point is reduction of co2, if thats the case then does it really matter in this context?


I think it matters only because there is a strong contingent of alternative energy supporters that do not see nuclear as part of the mix when talking about ‘renewables’ and for those folks the math is really hard. Conversely the math is easy with a strong nuclear mix.


Oh I get that but it also illuminates the shallowness of their position given that the reason they are against wind and solar and hate fossil is because of CO2.

Nuclear is literally the best combination of the best features from each of the other forms of energy.


Who cares if it's renewable when it's inexhaustible.


640K should be enough for anybody(tm).


is fission material inexhaustible?


It is inexhaustible in the sense that fuel is not the limiting factor on how many nuclear power plants we can build.


In this context yes. The sun also run out of juice sooner or later.


I have half a suspicion that it's the fact that it's burning through lots of fuel that is driving it's adoption. Processes in general seem to be driven by a kind of 'pressure' between low entropy and high entropy regions. This includes life itself. If life has a purpose it is to increase the flow across these low/high entropy regions. I don't think it's too outlandish to suppose some kind of hidden process that drives systems in general to optimise this flow. Bitcoin is just such a system, it's doing this transfer perfectly. Something tells me it's going to be extremely difficult to stamp out and I will be surprised if it does not continue to rise in value and energy consumption at an exponential rate, unless something systematic is done to disrupt it's progression. Buy bitcoin.


95% of transaction data is fake. We have no idea what adoption actually looks like. [1] The bitcoin price is "based on a true story" in true Hollywood fashion. Its design makes it impossible to stop the rampant and obvious manipulation. The game is rigged. No amount of technical analysis or philosophy is going to help you predict the outcome of a rigged game.

[1] https://www.forbes.com/sites/cbovaird/2019/03/22/95-of-repor...


What Forbes reports as mostly fakes are exchange trades, not on-chain transactions. These are two completely different things...


Yes and no. They’re not on-chain but so what? Exchanges are the sole fiat gateways, which in turn determines the exchange rate between BTC and fiat, which in turn determined the exchange rate between BTC and goods and services. These off-chain transactions determine how many apples a bitcoin gets you. The net is then settled onto the blockchain. They’re relevant. As relevant as any Lightning transaction, or is LN not “real bitcoin” either?


You tried to claim we knew nothing about Bitcoin's adoption because 95% of exchange trades are fake. I'm telling you this is irrelevant. Exchange trades tell us nothing about Bitcoin's adoption. They are just noise from wash traders, crooked exchanges, arbitragers, etc.

To gauge Bitcoin's adoption you need to look at on-chain transactions, not exchange trades. Makes sense?


We shouldn’t confuse trading for fiat money with on-chain transactions.


I'm curious why they should get a pass. They're a first-class part of the ecosystem, and pretending exchanges don't exist to goose the numbers feels dishonest. Further, it's the exchanges that set the "price" of bitcoin relative to fiat, which in turn sets the exchange rate for BTC to goods in on-chain transactions. Unless you're suggesting there's an "exchange" price for goods and a "black market" price for goods that each value Bitcoin differently?


Because as per your linked article 95% of it is fake. Supply of fiat money is also „fake“ in a sense that it’s arbitrary controlled by one entity per country at most.


Do you not think there's a meaningful difference between privately-run exchanges fraudulently manipulating the price to enrich themselves (to clear short or long positions off their books, pump the value of their assets, etc) -- and central banks who operate on behalf of the people of their respective countries to ensure a stable and reliable money supply?


I think in the long run there’s none. Look at devaluations in various countries. Or cut of paper money circulation in India. Or the $8Trln “printed” by the US to balance out Chinese foreign reserves (also $8Trln at the time by coincidence)


It appears you need to do some research on the role of central banks and the federal reserve, goals of the money supply, etc. That's not accurate, that's not how it works. The reason we create more money is two-fold.

(1) There are more people now. Not creating money disproportionately benefits the people who were alive before you. If you print no new money, the amount of wealth you have doubles as a proportion of the population when the population doubles. As economic activity increases and becomes more efficient you can do even more with that money. This pressure creates wealth inequality over time -- this is in part what the pilgrims sought to escape as they fled the old world of kings/queens/fiefs/lords.

(2) A predictable rate of inflation incentivizes the allocation of capital to productive endeavors. If your money just became more valuable over time, why on earth would you risk it by investing in something when you can just sit back, chill and be rich? That's why Bitcoin is a god-awful currency. Nobody wants to spend it because they think it will "mewn soon."

The federal reserve doesn't print money, the treasury does. They didn't create money to offset Chinese loans, they sold treasuries (debt obligations) to China, which in turn yielded money. You know what, I won't do as good a job as this article will explaining it to you [1], entitled "Understanding How the Federal Reserve Creates Money."

That all said none of this matters to you, a savvy investor with assets, because you shouldn't hold money. It's not intended to be held, it's meant to be circulated. Go buy things with it, that's what it's for. It can't depreciate in your hands if you've bought something with it. Salaries track inflation, housing tracks inflation, debts don't, so your principal goes down in real-world dollars over time. If you live paycheck-to-paycheck you're totally unaffected.

I'm starting to think the solution to Bitcoin is forcing everyone to attend civics and economics classes.

[1] https://www.investopedia.com/articles/investing/081415/under...


Replacing an oppressive apparatus that is relying on proof of military/police power to establish trust in banking with some form of an algorithm that is relying on proof of work/energy may be energy saving at the end. Just compare how much police/military has to be maintained and related resources spent to the naked energy for mining/transactions.


Both of those will remain. Even if we fully adopted Bitcoin there's no world in which we tell the army and the police to go home and thank them for their service. They do other things. It's not particularly effective to tell ISIS "you can't hurt me -- I've got Bitcoins!" You can't double-spend this energy budget.


It’s a big question to what extent the wars are/aren’t an extension of economics. My understanding it’s a direct relationship. ISIS got their money from selling oil or from sponsors selling oil for dollars or printing dollars. Police is another matter. But as much as crime has to do with cash money or centralized capitalism it may become moot when fiat money and related misuse potential is abolished.


A decentralized (except for China), un-regulated payment system currently being used primarily to break the law with the purchase of illicit narcotics, goods and services is going to prevent the funding of terrorism how exactly? My understanding is these groups are using it already. Here's a writeup on how North Korea is actively using Bitcoin to circumvent fiat sanctions [1] from a pro-crypto news source. Here's one on how Mexican cartels use it [2]. If anything this means we'll need a bigger army. How is abuse going to be abolished through a system literally designed to prevent any form of controls?

[1] https://cointelegraph.com/news/north-korea-increasingly-uses...

[2] https://www.ccn.com/how-mexican-cartels-use-chinese-crypto-b...


> Replacing an oppressive apparatus that is relying on proof of military/police power to establish trust in banking with some form of an algorithm that is relying on proof of work/energy may be energy saving at the end.

Bitcoin, 0.1% of all electricity: 7 tps

THE ENTIRE REST OF CIVILISATION, 99.9% of all electricity: a whole lot more than 6993 tps.


The best comparison is with the energy used for gold mining which far exceeds bitcoin energy costs. If you look at the giant trucks used in gold mines, you will are the energy savings.


one day someone will tell bitcoiners that (a) gold isn't the basis of the economy any more, and hasn't been for quite a while (b) yes, gold mining is also an ecological disaster that should be stopped

can you please cite your source? was the refutation also published in a peer reviewed journal?


The refutation (https://medium.com/coinmonks/the-reports-of-bitcoin-environm...) is a medium article.

Please try not to let that influence your opinion about the article though, because it does rightly point out the flaws in the original calculations, and the validity of the peer review of the original article.


didnt think so. hundreds of comments, some lengthy, and nobody knows whats really going on? also, i mean, maybe some cynicism ought to be tolerated if misinformation is? its hard work to do real, rigorous science, which is what journals like nature represent. but then we have this echo chamber in here where its been "refuted" by internet experts in their parents basements? (allegorical). i know there are/used to be educated people on hn, not just businesspersons. where did they go? hn is ostensibly about intellectual curiosity. but you cant actually satisfy intellectual curiosity with makebelieve. someone has to stand up for the truth, and for the blood and sweat that makes discovering truth possible: the scientific method. starting from doubt or skepticism, form a hypothesis, test it: observe and predict. theorize. replicate. repeat.


You're debating numbers you don't like by making up other numbers. Whatever. The point is that it's a massive waste of energy and emissions, and that's undeniable.


There are a billion people living under authoritarianism who are stuck with an increasingly devalued Yuan and steadily losing the ability to obtain other currencies.

Is that not also a problem that can result in humanitarian disaster? It certainly has before. I don’t think we should be comfortable with blanket bans just because they are accompanied by government greenwashing PR.


Why would a devaluing Yuan be bad for working class Chinese? What are they buying that’s getting disproportionately more expensive? We assume you call devaluation lower FX to dollar, don’t you? Because dollar is also subject to inflation obviously.


Bread. Look at the Arab spring. All countries that revolted did so in a period when the price of bread exploded. That price explosion was caused by financial mismanagement of the leaders of the country.

The dollar has lost 98% of its purchasing power over the past 100 years, and in recent years has been watered down enormously with QE. That money had to go somewhere, which is why stocks and corporate debt is currently at record highs. QE isn't possible in Bitcoin, and the coin itself is deflationary to 0 in about 2140.



Bitcoin.org is not likely to be an unbiased source when it comes to the negative aspects of Bitcoin.


I'm guessing nature.com is also not likely to be an unbiased source...


Nature has nothing to do with "nature," apart from the fact that science is concerned with the behavior of nature. It originated in 1869, long before climate change or energy waste was a known phenomenon. It's a scientific journal, they would likely accept any paper in support of cryptocurrencies that earned enough reviews.

Additionally, if you are implying that anything "natural" should be biased against cryptocurrencies, you are actually showing support for the root comment. It's admitting that cryptocurrencies are harming nature.


Both gold mining & forex consumes magnitudes more energy than Bitcoin mining. Whatever the chinese rationale is, it ain't about the climate.


>forex consumes magnitudes more energy than Bitcoin mining

Source on this?


Funny and sad to see how, instead of seeing opportunities, the forum with the most open minded tech people will rather go with "SHUT IT DOWN"


Yeah, and I'm closed minded for refusing to try crystal healing.

Open-mindedness is a virtue only if it helps you find the truth. Often it is more useful to judiciously discard ideas which have been debunked.


Which ideas in this thread have been debunked?


Seeing opportunities doesn't mean plucking out and leaving your critical eye at the door.


Agree, point still stands though. There's pros and cons to everything. Why focus on the latter?


Thalidomide [0] has been demonstrated to reduce morning sickness in pregnant women. Oh, and it also produces a high rate of birth defects. But let's not focus on the latter, shall we?

I'm sure there are pros to cryptocurrency. One of the cons is that it contributes to climate change. We've all heard plenty of cryptocurrency drum-beating over the years, it's not like "focusing on the latter" is some crazy imbalance of criticism.

[0] https://en.wikipedia.org/wiki/Thalidomide


Not all crypto is based on mining, so not all crypto contributes to climate change. Suggesting all crypto is bad because bitcoin uses energy is silly.


What's silly is to swoop in all Captain Pedantic-like, cape flapping in the breeze, at the slightest mention of "cryptocurrency". Thanks for the correction, Cap', but the title at the top of the page says "Bitcoin" and the topic I'm replying to has to do with energy use.

Now where did I put that Cryptonite...


Do y'all just expect people to put their head in the sand, accept your currency of the future and accept their stupidity when compared to the crypto-Evangelists? I'm in a position where being able to make fast and cheap transactions between countries would benefit me, I don't even care for anonymous. Can I use crypto for that without a massive overhead? No, I can't. Should I stop focusing on the fact that I can't? If I understood your beef, you'd suggest I do just that. Ignore the fact that it's not delivering on the promise and just focus on the pros of the system.

<rant> I'm sick and tired of this anti-con attitude. I've been encountering it a lot while talking to people about their ideas, especially from those that can't hold their idea together.

As a product builder, I meet with a lot of people who pitch me their ideas and I decide if I help them build it or not. Now, I do spend a lot of times before actually building the product to understand what problem the customers solve and what solution they chose. That means asking a lot of questions and asking a lot of why. I've had a lot of clients become defensive and giving me the pros and cons to everything so why focus on the latter speech. This is before we even start building the product.

Asking for input on how something works, and they become defensive that I'm a pessimist...

I've had three outcomes from this: * first is a group of people that will not work with me anymore, will tell their friends not to work with me and none of which I've heard a lot about after we discussed; * second is a group of people that went with my analysis and most of them are still my customers and refer me to their network; * third is a group of people that pivoted based on my analysis and work with me with open ears and trust; these are the customers that give me the best return on investment and the best referrals. </rant>

While I agree that when someone showcases an achievement, it's rather bad to focus on the cons; when analysing a technology, a cult and or something that combines both of these, especially when it gets shoved down your throat every once in a while, I think we can assume a default not-interested position. I think it's in the people presenting the benefits to focus on the benefits, and the people that they want to convince to hang on as tight as they can to what they feel this technology is not solving for them.

Anyway, sorry about the unstructured rant, I just feel like this 'why focus on the latter?' attitude is damaging for products, for technologies and society in general. Don't focus on the good, or the bad, focus on whatever needs to be in focus to solve your current query...


Haha nice! I totally agree! :)

I think in the context of making business decisions you are absolutely right.

All I'm saying is that the benefits of an idea that has the potential to disrupt banking are much greater IMO than the cost of ironing out faults (that are sometimes exaggerated as in this case).

I'm not saying there aren't valid cons to it or that we should ignore them from a practical standpoint. We need to know what they are to fix them.

I just noticed that people are quick to dismiss something because it's not perfect and that sort of mindset is counterproductive.


Because the cons are really bad. And the pro's are nifty.


I am not bitcoin proponent, however to be fair I wouldn't judge only one side. The World's economy is currently based on assumption of constant growth therefore it is going to be catastrophic as well. I have no hard data but look how much resources the present monetary systems consume, that including cost of running air-condition in any big financial hub offices.


Luckily, proof of stake research seems to be going really well. We can have decentralized blockchains without the climate impact.


Security-wise they haven't been really tested yet, but Ethereum moving to a PoS model will be a good case.

The only reason they are accepted at the moment is that it's free money, especially for the initial coin holders(founders/friend investors etc.).

For some reason people now accept fully pre-distributed coins. At least Ethereum went through a PoW phase to allow for some non-ICO distribution.


POS hasn't been proven to work without centralization.

It's why alt coins have stayed basically irrelevant.


there are few things on this planet that are less wasteful and more useful/important for our civilization than bitcoin. it's the first time in history we've been able to express and implement monetary value and security thereof in terms of pure energy without any middlemen.


Except for, you know, all the miners wastefully vying for a chance to be the middleman for a given block.


There's value in competition, though. Bitcoin doesn't eliminate trust, but it does commoditize that function. Commoditization necessarily means "many producers", so there's no way to achieve that without duplication of effort - but I guarantee that one Bitcoin ASIC has a lot less environmental impact than one human.


We already use computers in traditional banking in a much more efficient way than bitcoin.


There have been previous threads on HN with some back-of-the-envelope comparisons of Bitcoin's energy consumption vs the global banking systems, e.g. https://news.ycombinator.com/item?id=18325430 . If these rough calculations are correct, the global banking system uses ~100TWh/year (including datacentres, branches, heating in offices etc.) while Bitcoin is around one-third of that at ~30TWh/year for a negligible percentage of the total number of transactions, and a single Visa transaction (again factoring in datacentres etc.) is 41Wh per transaction whereas a single Bitcoin trasaction is around 20,000 more at ~826kWh. That was also 5 months ago, so the situation is likely to have got worse for Bitcoin, given the traditional banking system is incentivised to reduce energy consumption whereas Bitcoin is explicitly designed to increase energy consumption over time.


Do the numbers in that article, uhhh, add up?

The article estimates the total number of ATMs at 3 million, with an average daily power consumption of 5Wh, for a total yearly power consumption of 13Twh. Except if I punch [3 million * 5Wh * 365.25 to terawatt-hours] into the Google, I get 0.0055TWh. If I assume the author meant to type 5kWh as the average daily power consumption, you get 5.5TWh, which is closer, but still not the stated quantity.

[EDIT: OK, so I if I punch [3 million * 500W * 365.25 days to terawatt-hours] into the Google I get the 13TWh the author estimated for ATM consumption. So the author is actually assuming that the average ATM is consuming 500W?]

Likewise the numbers for how much electricity bank branches consume doesn't seem to add up (it seems like the author assumes branches consume an average of 10kW, not 10kWh/day?), and I can't replicate any of the numbers given for bank server energy consumption (just multiplying the numbers given in the article together in different ways).

Can someone else get the numbers in the original article [https://hackernoon.com/the-bitcoin-vs-visa-electricity-consu...] to add up?


Bitcoin also provides very, very few of the features of the global banking system, which does a lot more than run transactions!


do these calculations take into account energy equivalent of running all the armies in the world, funding their wars and conflicts? because entire banking system exists on a premise that there is an army behind every fiat currency, so it's not really honest to exclude that from communication.

bitcoin security on the other hand is backed purely by energy spent by miners.


The idea that bitcoin will magically make armies obsolete is one of the most laughably silly ideas I’ve seen in a long time, and that’s quite the bar to clear.

Hint: wars predate fiat currency. You’d still need army without fiat.


Read on British debt and it’s relationship to the WWI and WWII.


The fundamental problem you’re going to have is that any point you decide is the beginning of debt based fiat currency, well there’s still a crap ton of war before it. If you say that the brits were really using fiat during WW1, a dubious argument, then I’m going to gleefully point out that the Romans conquered the Mediterranean using physical gold & silver coins; no fiat.

It’s entirely possible to fund massive wars without fiat currencies. We know this because we’ve seen it time and again. Taxes and bonds can be used even with a hard metal currency, as does the handy expedient of promising a portion of the spoils of war. I see no reason why a bitcoin based country couldn’t just raise taxes and bonds just like the gold backed ones did for literally all of human history.

Beyond that, the world hasn’t seen any truly massive multi-lateral engagements since the proliferation of fiat currency. While the Middle East remains a hot spot, there has been nothing to match the scale and hardship of a world war or a napoleonic war. If the theory is that fiat currency enables war, you’re going to have a very hard time explaining the limited scope of conflict since the abandonment of Bretton Woods in 1971.


why obsolete? i never said that. bitcoin will just decouple money security from state security. which is why when you compare energy consumption, you need to include at least some chunk of resources dedicated to army, defence, etc.


You said "do these calculations take into account energy equivalent of running all the armies in the world, funding their wars and conflicts?"

That's not "at least some chunk", that's the entire cost that you're trying to wedge in there.


ok, feel free to only include partial cost. how does that change my point?


In my opinion, the fraction of the cost of the army that goes to preserving fiat is somewhere in the region of 0%.

What maintains the value of fiat is not government coercive action (e.g., having an army that forces people to use currency). Instead, the value is dictated by how much the populace believes it is worth. So it's the general government actions to maintain the health of the economy, and none of that would disappear if the government were to decide not to use fiat.

Indeed, to the extent that you'd compare how much the government spends in a hypothetical world where it doesn't use fiat currency versus one that it does, it probably takes more resources in the first case (i.e., fiat currency is a net asset to the government, not a net cost).


The premise of “no fiat, less war” is just asserted without any proof, and is actually quite ahistorical.


I love the idea of "no fiat, less war". I also love the idea of "less war". I don't believe war is a natural human occurrence but instead usually done for gaining fiat. However, I do believe that trading is quite natural and our current fiat implementation often simplifies trade. So maybe a borderless fiat simplifies it even more.


Good luck explaining Rome then. No fiat, lots and lots of war.

i never said nor implied "no fiat, less war".


Now you’re just dodging the question. Prove your assertion that a country on bitcoin would need a smaller army. I’ll wait.

Edit: saying that the economy would be deflationary and thus couldn’t afford a large army would be a hilarious way to go.


fiat's value is, at least partially, backed by an army that can defend/assert it. not having fiat eliminates the need for as much army.


There’s two issues here.

First, the logic doesn’t work. Let “has fiat currency” be A, and “has a large army” be B. You’re asserting “If A then B; therefore if not A then not B”. This is a formal logic error called “denying the antecedent”, which means the argument is invalid.

(You also don’t support A well, but that’s a side point because your logical assertion doesn’t work).

Second, there are plenty of examples of rich fiat countries with small armies (Switzerland, 0.7% GDP defense spending) and non-fiat countries with massive army expenditures (Roman Empire, harder to calculate due to history and lower productivity, but at least 2.5% GDP and 80% of the entire government budget). The presence of both indicates that the form of currency a country uses is secondary to other intangible aspects when it comes to the formation and maintenance of large armies.


> Let “has fiat currency” be A, and “has a large army” be B. You’re asserting “If A then B; therefore if not A then not B”.

those are incorrect presumptions and therefore incorrect conclusion. A is "has fiat currency", B is "needs an army or other means to maintain fiat value".

of course army is not the only thing, but it's one of the things in many of the countries. whatever other things other countries have to assert fiat value - those too consume some energy-equivalent of resources. army is just the most obvious and easy to understand example.

and yes, there are also feedback loops, there is no strict causal relationship between the components of this system, which is yet another reason why you can't make these energy consumption comparisons without being intellectually dishonest.


> yet another reason why you can't make these energy consumption comparisons without being intellectually dishonest.

The intellectually dishonest part is trying to shove as many extra costs onto the fiat currency side of the equation without counting them for cryptocurrency.

Comparing the energy cost per transaction is a simple, pairwise comparison. Even if all the world used bitcoin for currency, there is no reason to expect that things like banks, armies, and the entire financial ecosystem wouldn't also exist. Trying to make fiat currency account for all the latter costs is just trying to mask the fact that bitcoin is by design inefficient.


> The intellectually dishonest part is trying to shove as many extra costs onto the fiat currency side of the equation without counting them for cryptocurrency

let's meet in the middle then? i don't shove as much as possible but you shove enough for comparison to be honest.

> Comparing the energy cost per transaction is a simple, pairwise comparison

it's simple and wrong. energy-efficient transactions isn't bitcoin's goal. this has already been mentioned, i suggest you re-read the thread.

> there is no reason to expect that things like banks, armies, and the entire financial ecosystem wouldn't also exist

who's expecting that? i'm honestly amazed by amount of strawman-ing happening in this discussion. didn't expect that on HN.


You can change the definition of B all you want, it's still a formal fallacy, meaning the argument is literally worthless. You have to structure a very different argument from what you've shown to assert that bitcoin would reduce national military expenditures, not just tweak the details.


[flagged]


> it's not about definition of A and B, it's about structure of the sentence

I agree! And the structure of the argument is fundamentally invalid.

> there is no need to do this dance of yours with logic and fallacies

... Oh, I guess we don't agree.

> it's really a truism

"I don't have an argument, but I believe it very strongly".

> you are trying to confuse people and/or push some agenda

Accusing those who disagree with you of pushing an "agenda" is both a bad argument and bad etiquette. Stop.


> Accusing those who disagree with you

but you don't just disagree, you make convoluted invalid arguments. there is no logical fallacy in

> if maintaining fiat value requires spending resources then not having to maintain fiat value means there is no need to spend resources to maintain fiat value

it's indeed a case of:

> "I don't have an argument, but I believe it very strongly".

but on your part.


Explain the value of the Somali shilling, then.


By that analogy we use plenty of people, buildings and power in traditional banking. I'm guessing that easily outweighs the power and costs of bitcoin mining.


Much less secure too


Many producers are actually few with specialised hardware(i.e bitmain)


But to enter the market, you just need to buy those Bitmain ASICs and find a cheap power source. That's what makes it a commodity market: barriers to entry are low, so if a big player gets too dominant, a bunch of new entrants with money but not necessarily expertise can take them down. You can't really do that to say Goldman Sachs or Wells Fargo, where a large portion of the competitive advantage they've built up is the trust (har har) and relationships they've developed over the past 150 years.

There's perhaps worries that Bitmain could get too big and poison the chain, but they're hamstrung in that by Bitcoin being an open protocol. If they did that the network would fork, and despite the higher hash rate in the Bitmain fork, holders would dump the Bitmain coins and buy the original fork, since they wouldn't trust the poisoned chain.


your understanding of bitcoin is very lacking. miners never waste any energy, they spend it to acquire proof that they spent it. that proof has value and while value of the proof is larger than market value of bitcoin rewarded for the proof - miners will keep mining.

also miners are not middlemen - they don't control transactions, they don't control the peer to peer network. they are there to publish the proof and get their reward.

you really should inform yourself on the topic before debating it.


Miners are literally there to skim value out of a transaction. They're middlemen.

And it is a waste. There are plenty of more efficient ways to make a transaction. I get that bitcoin is designed around this waste but that's hardly an excuse.


There is zero waste. You don’t understand bitcoin. Bitcoin is not about transaction efficiency or throughput, use MySQL for that. Bitcoin is about secure ownership of money, peer to peer exchange and immutable fiscal policy.

What you call waste is simply price for some level of security that isn’t backed by any armies.

Edit: also, no, miners aren't middlemen, that's just another misunderstanding on your part. middleman has control over the process they facilitate, miners have no control over anything but construction of blocks and how much energy they are willing to spend. you could argue miners can choose to ignore transactions coming from me (if they manage to figure out how to identify them), but it's a competition of independent parties so there will always be other miners that do not choose to ignore me. for that to be an issue big enough to call miners middlemen you'd need majority of miners to collude on something quite obvious and demonstrable, which would undermine bitcoin project itself, rendering miners' own investments in bitcoin and infrastructure worthless - not in their interest. besides, with confidential transactions this entire point will be moot.


> Bitcoin is not about transaction efficiency

Hold on, the response to “Bitcoin is inefficient with energy” is that efficiency doesn’t matter? That isn’t moving the goalpost so much as removing it.


you missed a word there it seems?

Edit: seems like you've edited your message. next time try to be more polite and mark your edits.

i'm not saying efficiency doesn't matter, i'm saying primary goals of bitcoin are different.


If you exclude gold and every other physical commodity ever.


Gold can't be used electronically without permission from a third party.


Do not cryptocoin transactions only work through the literal agreement of a large number of third parties?


third parties only observe what's published in a blockchain. they can choose to disagree with blockchain. when all/majority third parties disagree with blockchain - it becomes irrelevant and worthless while some other branch of that blockchain becomes "the real one".

it's really not the same as having limited number of third parties proclaim which version of blockchain is correct.

but more importantly - one doesn't have to ask permission from any third party to publish their transaction either via internet or radio or satellite or morse code. if you still think trading in gold is safer/easier - i don't know what else to say.


If you think I indicated anything about how safe trading in gold is - I do know what to say, and I've pretty much just said it :)


> in terms of pure energy without any middlemen


This is such utter nonsense. There are a whole class of middlemen!

And decentralised currency is not useful or important, unless you've got some sort of decentralisation fetish, which most people don't.

This is honestly one of the most inflated, ridiculous claims I've ever seen in the cryptocurrency space. A space which is already riddled with ridiculous, overblown claims!


as you don't provide any elaboration to your claims i'll just disregard them as ungrounded and/or irrelevant. try again.


Exactly as ungrounded and irrelevant as your fantastic claims of usefulness then?


i provided an elaboration: it's the first time in history we've been able to express and implement monetary value and security thereof in terms of pure energy without any middlemen.

you're welcome to provide actual refutation.


You ignored it - there are middlemen and your claims are ridiculous fantasy.

Miners are the middlemen, complete with fees. Bitcoin is not pure energy any more than any other electronic currency. Proof of work is energy already used, not somehow carried in a bitcoin.

The whole "pure energy" thing is just air-headed utopianism AFAICT


> there are middlemen and your slaims are ridiculous fantasy

this is an assertion from your previous message.

> Miners are the middlemen

this is an elaboration for your assertion, that was missing from your previous message.

you don't have to lie, it's fine if you admit your mistake and fix it.

> Miners are the middlemen, complete with fees

this is false. middlemen have control over the process. miners don't control who can transact with whom and transaction fees are still orders of magnitude lower than the actual flat block reward. moreover - miners don't set the fees either, market does. miners only participate in a competitive environment of providing proof of work and getting paid for it. they are "contractors", not middlemen.

> Bitcoin is not pure energy any more than any other electronic currency. Proof of work is energy already used, not somehow carried in a bitcoin.

bitcoin is not pure energy and i never claimed it was. if you go back and try to read carefully you'll see that i was talking about monetary value and security. bitcoin is just a record in a ledger and not different in t hat regard from thousands other cryptocurrencies. what's different is the difficulty number of every block in the bitcoin blockchain - that's where security comes from, that's how hard it is to modify history and that is where big chunk of bitcoin's value is coming from.

> Proof of work is energy already used, not somehow carried in a bitcoin.

again, you're misunderstanding what i'm saying. you can't convert bitcoin back into energy that was used to create the blockchain, however you do have to spend equivalent amount of energy for each block to be able to mutate the history. that's what i mean when i say that bitcoin is security of money backed by pure energy.


> this is an elaboration for your assertion, that was missing from your previous message.

Not really. Who else was it going to be, it's not like I'm the first to point this out.

> miners don't control who can transact with whom

Of course they do. It's up to them which transactions to include in a block.

> transaction fees are still orders of magnitude lower than the actual flat block reward

People who like bitcoin like to talk about inflation and QE as theft from their pockets. The block reward is a fee extracted from the ecosystem in the same way.

> bitcoin is not pure energy and i never claimed it was

"it's the first time in history we've been able to express and implement monetary value and security thereof in terms of pure energy"

So yeah, you did, you said it was monetary value expressed as pure energy, which is meaningless. It's not a measure of joules, and it's not the hashing which gives it value. Quite the opposite - the speculative value is what attracts the hashpower.


> It's up to them which transactions to include in a block.

and "them" is not a single entity or even small number of entities. miners compete for block rewards and every transaction with a fee contributes to the profit - whatever malicious miners choose to leave out will be included by non-malicious miners making them more profitable.

calling miners middlemen when they would only have actual control over which transactions appear on the chain if majority of miners colluded (destroying the value proposition of bitcoin in the process) is very disingenuous.

> talk about inflation and QE as theft from their pockets. The block reward is a fee extracted from the ecosystem in the same way.

i don't even... QE and other fiscal measures are short term decisions made by bunch of powerful humans behind closed doors. Bitcoin emission schedule was decided ten years ago and has virtually zero chance of being changed without destroying the project and it's value. you must be trolling right now if you say you don't see the difference.

as for why is there bitcoin emission schedule at all - because that's probably the most fair process of distributing bitcoin.

> So yeah, you did, you said it was monetary value expressed as pure energy, which is meaningless

either you start reading and quoting me correctly or this discussion is over, i'm done with your manipulative tactics.


I love how quoting you is a “manipulative tactic”.


I think he implied that quoting him incorrectly is a manipulative tactic.


https://imgur.com/a/bcAlwmo

He wasn't quoted incorrectly, the part within quotation marks is verbatim from keymone.


I love how you didn't even notice that quote was doctored, which is my point entirely.


I'm not sure why you'd make such a trivially disprovable claim, they quoted you word for word, it's very easy to prove that with a quick browser text search...


you won't find "monetary value expressed as pure energy" anywhere but in comments by Nursie.

why would lie about such trivially verifiable thing?


https://imgur.com/a/bcAlwmo

The part between quotation marks, also known as "quoting", was taken word for word from your original comment.


Bitcoin transactions don’t use a material amount of energy: no matter how many miners the transaction capacity is fixed. Energy use just increases as miners compete for the block reward.


World adoption -> increase in BTC/USD value (lambos!) -> USD block reward increase -> more GWs spent mining.

It's not linear at every stage (for example, more USD per block reward will reboot Bitmain to produce even more efficient miners, which will eat up some of the rewards) but it's close enough to be concerned.


Why don't people rail like this against the aluminum industry? It's just as wasteful. Bitcoin provides substantial utility and value to society, the energy to secure bitcoin is a cost just the same as the energy to smelt aluminum.


> Bitcoin provides substantial utility and value to society

Only for speculation and money laundering. Bitcoin's exaggerated volatility makes it unusable as a currency. If it would you wouldn't be making fun of the guy who spent N bitcoins on 2 pizzas instead of holding it. And conversely, if everyone would hold bitcoin, it wouldn't bring any utility to society.


> Bitcoin provides substantial utility and value to society

Equating the cost of Bitcoin and aluminum doesn't seem like a sound argument unless you can also equate the value (or show that they are approximately close.

Could you credibly claim Bitcoin brings the nearly the same value to society that aluminum does?


Aluminium smelting results in aluminium. You can make stuff with aluminium.

Bitcoin mining results in heat, both literal and metaphorical.


Aluminum is infinitely more useful than bitcoin.


> Bitcoin provides substantial utility and value to society

Do you have any proof of this dubious statement?


I've been reading through True Names and the various essays that proceed it in it's most recently published edition and I see crypto currencies as the fulfilment of many of the ideas talked about there. Particularly uncensored anonymous value transfers between parties.

The idea that you can send "money" to anyone regardless of who you or they are does provide some value. Unlike any other financial transaction system that proceeded it that I'm aware of, you can't be deplatformed from crypto.

How valuable you find this likely coincides with the value you place in the ideas of crypto (the original definition) anarchy.


> I see crypto currencies as the fulfilment of many of the ideas talked about there.

As it stands, crypto currencies are a promise, not a fulfillment. They will become a fulfillment after they actually solve those problems. But it's a long way from theory to practice, even after all the technology is deployed.


Here's a well reasoned essay by Bruce Schneiner about why cryptocurrencies are useless.

https://www.schneier.com/blog/archives/2019/02/blockchain_an...


Because I own things made out of aluminum....


But it still doesn't waste as much energy as the standing armies fiat currencies rely on. And if your country doesn't have a large standing army then your currency is being subsidized by those you ally with who do have standing armies of significance.

And the good it brings to the world in being a non-nation state controlled currency is obvious. From enabling continuation of money transfer in failing or restrictive governments to allowing for capital exchange between individuals directly without rent seeking or censorship it provides good every day.


Why should Fiat money use more energy than global bitcoin adaption? Bitcoin already used as much energy as medium-sized countries (I believe it was as much as Ireland last year or the year before) and nearly no one uses it for daily payments.

Compared to that, I'm not aware that the Swift Network or Visa/Mastercard would run whole power plants to support their energy needs. They just need a medium sized data center to support hundreds of millions of payments a day.


Agreed. I'd like to add that even if Swift/Visa/etc. combined use power plants worth of energy (which I actually assume they do, though it's hard to tell), they do orders of magnitude more payments with it.


Mainframes running a ton of financial transactions bill by CPU usage from IBM. Banks etc want to use as little computer resources as possible.


Running fiat involves more than just electricity.

People, offices and everything related requires power and physical location too.


>Why should Fiat money use more energy than global bitcoin adaption?

The problem was the original poster in this thread setting up the strawman that bitcoin is for every single transaction (or even a decent fraction of them).

But to answer your direct question: because the security and processing of it's transactions depends on the security of a nation state. That nation state's security stems from the military among other things. The energy expenditure is enormous and the influence of the nation state's desires on what transactions are processed is an everyday factor. This is obvious in watching the Justice Dept. interact with the major credit card companies.


Transactions that indirectly depend on bitcoin also increase its price, and cause more energy to be burned on mining. If bitcoin starts to secure any notable fraction of business it will cost much more than the amount of army needed to keep a currency stable.


Bitcoin has proven time and time again to be a giant ponzi scheme

https://www.reddit.com/r/buttcoin contains good reading


If bitcoin had global adoption, there would be no more armies in the world? That's quite a stretch...


This might be the case, no way to proof, but bitcoin has been proven to be useless as a medium of exchange so it's best to stop wasting all that energy on it. I believe there is a future for virtual currencies but there's still work to be done to work out the bugs.


From an energy-consumption standpoint, I'm not too surprised at this. They have better uses for their mostly-non-renewable power generation. This will probably continue the push towards bitcoin mining in places with stable renewables (like hydro and geothermal).

That being said, I just found https://www.coindesk.com/norway-ends-power-tax-subsidy-for-b..., which makes me wonder if current prices would be able to support mining there. Also, at least part of Washington State is interested: https://www.bendbulletin.com/business/6853387-151/central-wa...


"their mostly-non-renewable power generation"

Actually, most crypto mines in China are located in Sichuan or Yunnan, precisely because of an oversupply of hydroelectricity. More than a quarter of the world's hydropower is generated in China (350 GW) and most of that is from Sichuan & Yunnan. 350 GW is more hydropower generated than the next three biggest hydro producers combined (US + Brazil + Canada.)

Because of the demand-supply imbalance in Sichuan an Yunnan, kWh prices are cheap, hence mining is profitable. ~90% of the electricity in these regions is generated from hydropower.

The oversupply is a result of inadequate grid infrastructure preventing the transport of electricity to resell it to neighboring regions, and a slowdown of China's economic growth.

Sources:

http://dx.doi.org/10.1016/j.renene.2018.01.090 — Hydropower curtailment in Yunnan Province, southwestern China: Constraint analysis and suggestions — "The increasing curtailment of hydropower generation not only caused large-scale waste of sustainable energy [...]" In 2016 alone, Yunnan was forced to waste 15% or 31.4 terawatt-hours of hydroelectricity.

https://www.financemagnates.com/cryptocurrency/news/chinese-... ("In 2016, for instance, overcapacity from hydropower stations in Sichuan and Yunnan amounted to a whopping 45.6 terawatt hours")

It's so bad that China is now restricting the constructions of dams in Sichuan an Yunnan to not exacerbate the overcapacity problem.


Then why did they even build it there? You know what the demand is going to be in the near future and you know what capacity you're designing for. Was this built purely for mining? Because if so, the money used to build this could have been used elsewhere.

People often bring this up when talking about bitcoin mining but it makes no sense to me. How can this be true (and the whole truth)? It sounds like the kind of argument that bitcoin supporters would spread happily. Which I used to be, by the way. I GPU mined back when it was all fun and games. I used to also doubt the claims that bitcoin uses the power of a small country. I assumed some journalist looked at the difficulty, derived the number of hashes that need be done, looked at an average computer in their office, and voila. But then I did the math, taking the hash rate and figuring in the most optimal case, using only the most efficient miners, and to my surprise it's true. A small country of power just being wasted. I'm all for proof of stake networks, but bitcoin just has to die, the sooner the better.


They built it there because the river was there... you don’t choose where is hydropower. That the damm was built before the adequate power grid is operational will be totally irrelevant in a few years. Maybe they seize the opportunity to mine crypto in the meantime as a very profitable joke against crypto-investors...


Alright, but then why not build data centers there? There's other things that are not there because the power is not that cheap anymore (since there is demand by miners).

Even if it's true that they built capacity for nothing, no way that the power is just up for the grabs at almost no cost. There are always other purposes for surplus power.


That's where China has water.

In addition, China has also been trying to shove people to the interior provinces as a policy for quite a while now.


> Then why did they even build it there?

Because China. The country is/was flooded with cheap capital and the result is infrastructure projects everywhere. Some make sense, some not so much.


It's similar to new offices being built when there is enough empty office space in the city already.

If the government incentivises construction there will be big infrastructure projects. The government might not need the actual project and its output but rather the construction itself for fueling employment and economic growth.


from planet's perspective. everyone can be thankful


The planet doesn’t care, it will go on. With climate change, humans are at risk, not the planet.


Humans are at risk of resource shortages. Many species are facing extinction. Nothing bad will happen to the dirt, but if 'planet' means 'biosphere' then it's at the most risk.


Unlikely Life as we know it is at risk. The planet has been through many extinctions.


The risk level is nowhere near "everything is wiped out", but the risk level for species in general is higher than the risk level for humans.


New species will arise. That's how evolution works.


Banks run green. They only require lights in the building, the building, the branches, and the atms, the employee's cars, the oil deals financed, and the wars financed.


Same can be said about the Bitcoin exchanges. Minus the wars maybe but including the drug cartels.


What drug cartel runs on Bitcoin? I thought it was US Dollar.


>and the wars created


mining bitcoin with renewables is still a waste. You are now wasting renewable energy instead of nonrenewable energy. Both which despite the wording are limited.


"Waste" means you have no use for it. Yet some people are willing to pay for the Bitcoin, they obviously see some use for it... the fact that you don't or can't even imagine what use that might be doesn't make it a "waste".

Let's say you go to such place with cheap electricity, start your own business, use that cheap electricity and produce something. If you cannot generate the same profit with your product as the bitcoin miners, then that's a waste. You just wasted electricity on your business that could otherwise be used to mine bitcoins and turn them into more dollars - more value for somebody.


Humans are not rational beings. They do not always purchase things they need. Fentanyl and Heroin are obvious examples.

Obesity is a problem in the united states and represents the over purchasing of food.

- Let's say you go to such place with cheap electricity, start your own business, use that cheap electricity and produce something. If you cannot generate the same profit with your product as the bitcoin miners, then that's a waste. You just wasted electricity on your business that could otherwise be used to mine bitcoins and turn them into more dollars - more value for somebody.

Value cannot be produced out of thin air. Mining a bitcoin without doing "work" is the equivalent of having a printing press and printing money. No work is done.

When you print money it is a form of theft not a form of work. Most countries recognize it and classify it as counterfeit. When you exchange a counterfeit dollar for a real product that required work, you are doing an act of thievery. When you mine a bitcoin then exchange it for real money, it is similar to theft. The only difference is the person you exchange the money with has knowledge about what bitcoin is, and the "work" (nothing) you did to get it. Sort of like how when a drug addict buys some heroin he's either in too deep or for users just starting out, he's ignorant.

A currency that constantly uses up energy is more wasteful than a currency that does not. Simple logic.


> Mining a bitcoin without doing "work"

yeah, that's why miners do work. They validate transactions, for which they are rewarded. Those who want their transactions validated see value in that, so they pay them. Therefore it's not like printing money. Therefore it's not a form of theft. Your simple logic breaks there.


The logic doesn't break down. They facilitate the growth and transactions of money being created out of thin air. Sort of like a bank loaning out and storing counterfeit dollars. Yes the facilitates transaction, but in the end they are facilitating the transaction of a dollar created out of thin air.

It is actually other way around.

No one mines cryptos where energy in less supply because energy prices tend to be high. The current mining rigs in China are almost exclusively located in regions where energy is cheap and in oversupply. China has many power-plants that must run at certain capacity floor and despite of that the demand is much lower. It makes so much sense to let that energy be used to mine cryptos which is like store of that value. This way energy is not wasted.

Chinese move has less to do with energy or environment but more about undermining a threat to their monopoly on currency.

Bitcoin mining has a potential to push innovation to invest more in alternative and greener energy sources.


It appears to me that inhibiting mining does not really have a lot to do with usage of Bitcoin as a currency. Even if they managed to completely wipe out mining in China, that would have zero impact on the utility of Bitcoin as a currency in China.


Do not expect the chinese government agents to understand all that.


Why a Chinese Bitcoin mining ban is good news:

* It kills the narrative that China controls Bitcoin.

* It severely diminishes the Chinese state's ability to disrupt the Bitcoin network by commandeering hashpower.

* The Chinese miners will move their operations overseas, leading to higher geographical/jurisdictional decentralization.

* It becomes relatively speaking more profitable for Chinese ASIC manufacturers to directly sell their miners compared to mining themselves. This will diminish their oversized power in the ASIC market and decentralize mining in terms of operators.

* BTC itself isn't banned, OTC demand will stay, causing a premium. This means some mining will likely continue in smaller, less obvious operations outside the reach of the state. Everything about that is healthy for the network.

* The biggest source of Bitcoin blocks won't be behind the biggest firewall of the globe anymore.

* The article mentions a phasing out, so the two-week difficulty adjustment period can more than likely gracefully handle this.

* Although a lot of Bitcoin mining is done with hydropower in China, it also has a significant share of cheap coal-powered mining. This likely makes overall Bitcoin mining greener, hurting the Bitcoin climate change FUD.


>This likely makes overall Bitcoin mining greener, hurting the Bitcoin climate change FUD.

I dislike the fact that Bitcoin fans have commandeered the term "FUD". The term originally referred to coming out of Microsoft, but you are using it to refer to well-intentioned people saying things that are true.

It's the same as what happened to the term "fake news."

Bitcoin has some very serious problems. We all know what they are. If you keep pretending they don't exist, you only hurt your own credibility.


> The term originally referred to lies coming out of Microsoft

No. It originally referred to the marketing strategy of IBM, which basically consisted of casting doubt on the viability of their competitors. "No-one's ever been fired for buying IBM."

It specifically did not mean outright lies, but the strategy of pointing out that when the market consists of an 800-pound gorilla and hordes of chimps, the chimps might be nimbler to respond to your needs and offer better prices, but you never know when one of them gets bulldozed, and if your infrastructure depends on them, that might be really bad for you. It is not necessary to lie to do this, and good FUD explicitly just consists of carefully selected verifiable factual statements that cast doubt on your competitors.

It is an extremely ballsy marketing strategy: "Yes, our product is worse and costs much more, but you know that we have done this for decades and will still be doing this and supporting you for decades to come." It sold mainframes like hot cakes, even when competing systems sometimes were literally an order of magnitude less expensive.

The association with Microsoft comes from how Gates was really impressed by it, and copied it for Microsoft, once they got big enough to use it. Unlike IBM, Microsoft used the term FUD internally, as revealed in the various documents that were leaked and/or published through discovery.


But the whole bitcoin climate change story isn’t true, the people making the claims may very well be well intentioned, they just aren’t correct.


Of all the fantastical things bitcoiners believe, the idea that the mining industry isn't directly responsible for a huge amount of CO2 emissions is one of the most egregious.


Did you accidentally reply to the wrong person?


I was responding to this point:

> the whole bitcoin climate change story isn’t true


There's a world of difference between the wild claims re: bitcoin pushing global warming above 2°C and bitcoin causing lots of CO2 emissions.


Bitcoin certainly has its share of problems. There is nothing true, however, about Bitcoin causing climate change.


Citation needed! Renewables are not free of externalities. Hydro damages environments.

Wasting renewable energy on crypto mining prevents that energy being used for something productive and so drives the need for more renewable capacity or drives further use of fossil fuels.

Bitcoin is an environmental disaster in the making. I see mining as akin to a religious rite that diverts potential away from useful activity and towards a fantasy instead.


It seems like someone along the way cleverly changed the valid and reasonable talking point about the intense and excessive energy use/costs away to a narrative Bitcoin (et al) are causing climate change - which is of course absurd; one of the bigger problems of Bitcoin (et al cryptocurrencies) is that their defence mechanism depends on using a higher amount of energy than someone who'd want to attempt 50%+1 attacks (or lower % take over attempts are still possible, just not guaranteed to allow double spend).


>* The Chinese miners will move their operations overseas, leading to higher geographical/jurisdictional decentralization.

I feel like you really don't get the... particulars of being a Chinese national, on multiple levels


There are many places in Central Asia, Southeast Asia, Eastern Europe, and probably most of Africa where a Chinese national can easily get a business visa to set up shop there.

Heck, given the amount of money invested, a visa for a first world country might be possible too.


Anyone can buy a real estate property for $250,000 and get citizenship in Turkey. This includes Chinese nationals as well.

https://extraproperty.com/turkish-citizenship-buying-propert...


* It becomes relatively speaking more profitable for Chinese ASIC manufacturers to directly sell their miners compared to mining themselves. This will diminish their oversized power in the ASIC market and decentralize mining in terms of operators.

Don't see this equation actually changing. Like you mentioned, operations will just be moved elsewhere. ASIC manufacturing and mining "tech" will still be hoarded and profit maximized.


The funny part about Bitcoin news is that for supporters, anything is good. "This is good for Bitcoin", as they say.


> This likely makes overall Bitcoin mining greener, hurting the Bitcoin climate change FUD.

It's not FUD if it's true, which you're implying with the first half of that there sentence...


It's debatable, most frequently cited articles are bogus with inflated numbers.


Commenters are applauding the environmental implications of this policy, but I’m curious why no one is considering the human side of this ban. There are a billion people living under authoritarianism who are stuck with an increasingly devalued Yuan and steadily losing the ability to obtain other currencies.

Is that not also a problem that can result in humanitarian disaster? I don’t think we should be comfortable with blanket bans just because they are accompanied by government greenwashing PR.


Bitcoin trading is already essentially banned in China.


Exchanges are, not OTC - it's booming.


No it is not a humanitarian disaster. If it was it'd be a economic policy problem and their are much more factors to be considering for that.

Plus your entire premise is wrong, yuan is definitely not increasingly devalued. Even if it was that wouldn't directly mean it's a problem


Because they finally realized everyone is using bitcoin to exfiltrate currency?


This is clearly the main motivation. If the CPC was so serious about curbing emissions they would put a high environmental tax on coal power plants and the bitcoin mining would quickly wind down as a result of higher electricity prices. The CPC requires a firm grip on monetary policy (and capital flows) in order to stay in power (and prevent a yuan devaluation).


More like they are using cheap subsidized Chinese power prices for something that they weren’t intended for. It’s more of an environmental play (since a lot of that electricity is produced by dirty coal burning).


I'd say it's more a consequence of subsidizing a highly versatile good. It must be continually regulated to ensure the subsidies aren't exploited for something that was outside the original intention. Sadly the increased regulation also reduces individual choice in favor of the governments vision of what's best for the nation.


Funny that they care about the environmental effects when the end result is something they have little control over, less so when it's a state-run or state-affiliated business


It makes sense to me. They believe their control is an important part of the country’s economic development. They’re willing to sacrifice the environment when they believe the benefits outweigh the concerns, but they trust their own plans more than that of individual actors. Not saying it’s right, but it’s consistent with their outlook on politics and government.


Why should China subsidize world bitcoin production with more bad air for them? At least the other stuff they use electricity to produce, like cars, steel, and rubber dog poop, has a tangible value.


They've taken a huge shift to improve their environment. This is initiative is what caused them to stop accepting the world's recycling and causing the massive recycling bubble.


When people realize that Bitcoin mining is a mechanism to prevent fraud, the energy consumption suddenly makes a lot more sense. How much waste in the world is the result of fraud and lack of trust? Quite a lot of it.

That said, reducing the energy consumption of Bitcoin should be an absolute priority. Lightning Network and other such technologies help.


It doesn't really prevent fraud that isn't already a solved problem. When was the last time you had to deal with wire transfer fraud?

If you buy counterfeit goods with bitcoin there's not much you can do. A credit card protects you from fraud over $50.

What exactly is this bitcoin waste getting us?


What it really gets us is a certain level of resistance against political interference. Using a simple electronic cash system is a million times more efficient, but the currency can be inflated and balances frozen by decree. Increasingly powers are being given to law enforcers to perform these actions without oversight.

As the political landscape worsens, bitcoin and similar technologies will begin to be used more, regardless of environmental concerns. The best way to avoid this would be to improve the political landscape with regards to money transmission/storage, which would be no simple task.


I feel like most people think credit cards are free. They are not, which is why visa and MC are billion dollar companies. The cost has just been shifted in such a way that it's not easily identifiable so people ignore it. There's definitely a cost. If the Bitcoin network can offer a lower overall cost, it could provide actual benefits.


Bitcoin is the first ever distributed ledger, that can store and publish transaction information for a number of adversarial parties.

All other systems are centralized, only work without adversarial parties or both.

This means Bitcoin doesn't need central banks. It doesn't need reporting transactions over 10k to some central governing entity. You can memorize a list of words that the cops can't seize in a random search from your car. It gives some freedoms to people.

However, the hash difficulty/energy consumption problem is a serious issue and many people in the community are investigating alternatives for it.

Also, take into account that the energy consumption is related to the hash calculation power available in a given moment, not to the number of transactions performed.

This also means that Bitcoin mining will consume the same amount of power even if no new transactions are being done between the owners of Bitcoin wallets.

If there's a way to make a distributed ledger that can store and publish transaction information for a number of adversarial parties without consuming the energy of an African country, I am confident someone will find it.

Many alt-coins are experiments on that regard, using several different algorithms and ideas.

However, this is still an open problem and I don't know any timeline about when it can be resolved.


I would not call it preventing fraud, rather simplifying global money supply and making it more transparent, which in turn could prevent fraud due to smaller attack surface and more eyeballs.


But this is just a pipe dream. You would just have fraud hidden away in Swiss bitcoin accounts and wallets in the Cayman islands. Isn't it just less privacy for the naive user and business as usual for the fraudster?


You are correct in that money can and will still be used for fraudulent activity. But the system itself (so far) could not be corrupted. So there is a class of systemic manipulation, that becomes a lot harder with Bitcoin (e.g. inflating money supply).


In theory, but in practice it seems easily manipulated.


It's getting us most secure decentralized network, which allows monetary exchange and storage for anyone and everyone.


If it would 'prevent fraud' it should be possible to e.g. retrieve stolen funds. Instead, it is a mechanism to ensure money is only spent once.

Cash solves this rather cheaply (because it is physical). Electronic money does it a lot more efficiently that bitcoin. Perhaps the power usage of all banks is higher than bitcoin, but power per transaction is a lot better.


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