I think it's kind of wild that you can just take a latent or otherwise inaccessible source of power and now convert it into money.
And it doesn't really matter what the price of BTC is for something like this, as the resource is more or less entirely unused. It's just sitting there, doing nothing, so any value you can make out of it is better than the nothing they're already getting.
An easier and more reliable way to make money is to sell it to neighboring countries that need energy. Like they had been doing. Seems to me a little corrupt birdie told them about BTC and their ruling class wanted in on another way to hide wealth. Like every other use of BTC
How is it easier to sell energy? Electricity is not digital, you need to build the wires, figure out the demand and fund the operations of the whole thing.
That’s already setup: they export something like ¾ of the electricity they produce to India. I suspect this is either trying to get higher rates or possibly challenges related to their seasonal hydropower issues – if India is building more capacity for the times when the water levels are too low, the long-term rates aren’t going to be going up.
I also speculate they have gotten all they can out of the arrangement. Or it just isn't as economically lucrative as holding back some of that power as a speculative bet on the future.
You don't need to build wires that spans half your country! Just a big building, some transformers or whatever equipment is used to consume the energy from the stranded producer and a lot of miners, as much as you can power!
That’s the rub; you can’t get the energy out of where it is. You can’t really use it for your country, you can’t sell it, it’s just kind of there, unused.
What do you mean you can't sell it? Bhutan exports 70% of their energy to India (https://www.sasec.asia/index.php?page=news&nid=1178&url=bhu-...). India needs lots of energy to do normal energy things that improve people's lives, like lighting and cooling homes and running irrigation systems.
So my understanding is that this particular power plant is hard to connect to their grid. Such things tend to be true, for example Kazakstan’s mountainous coal deposits.
Lots of things could prevent the sale of some energy, though. Someone else mentioned the idea that their market is saturated.
So I work in the energy sector, and you are correct. The method we use for pricing power at a grid level is "local marginal pricing" - this is a price that is based on the location, the demand for power, and the ability for us to get the power across constraints (that is across a power gradient). It is often uneconomical to transmit power great distances, and loss factors are not insignificant. Not sure about Bhutan's grid, or who they can interchange to, but there are frequently wind farms in TX that have to take a loss to generate power simply because they are forced to generate power, and there is no demand for power in the region, and the buses (power lines) are congested. Also stranded hydropower is common the world over - it's easy to generate that power but difficult to build grid and interconnects to transmit that power - the line losses would be too high. For other types of generators - typically nuclear, often times ramp times for them are in the months, so turning up and turning down power is often difficult which is why an application that is passive, droppable, and can withstand latency is ideal to consume such power.
> ... so turning up and turning down power is often difficult which is why an application that is passive, droppable, and can withstand latency is ideal to consume such power.
Sure, so investing in smart load management is an optimal solution. With EVs and chargers coming online that's a huge load you can send a signal to in order to adjust demand. A country like Bhutan is very well suited to this kind of approach.
Or change the energy mix so you have a balance of baseload and variable load generation.
Or do something with it that isn't guessing random numbers on machines 99.7% of which will never successfully guess a single block and go from factory to space heater to landfill.
Can't remember which miner, but one of the majors, made more money in credits for pausing their waste than they did from the bitcoins that came out the other end last year. It's just extorting the public.
> Not sure about Bhutan's grid, or who they can interchange to, but there are frequently wind farms in TX that have to take a loss to generate power simply because they are forced to generate power, and there is no demand for power in the region, and the buses (power lines) are congested.
So invest in building more power lines.
The myth of stranded energy is toxic. Wasting it on bitcoin mining is an incentive not to connect it to the grid the way it should be connected. Either don't build it, or build it and connect it. The worst case outcome is to build and then waste it.
You’re suggesting Bhutan alter their national energy mix rather than run a Bitcoin mining operation?
Bhutan has 0.15 vehicles per capita, among the lowest in the world. 47% of their popular has no education. You’re saying Bhutan should build a smart grid for EVs rather than run a Bitcoin mining operation?
Bitcoin mining generates literally no value for 99.99% of the population, so anything that improves the infrastructure is going to be more valuable than that.
Not really, I'm suggesting they sell more power to India which is what they do already. They can do that by lowering the price per kWh.
> You’re saying Bhutan should build a smart grid for EVs rather than run a Bitcoin mining operation?
I think that’s kinda ridiculous.
Not just EVs, there's plenty of things you can make demand-responsive. Do something - anything - with it. Electrolyze water for hydrogen. Electric smelters. Power for a data center! The world is your oyster.
What's ridiculous is wasting the power on lotto tickets and e-waste and furthering the single least efficient technology humanity has ever conceived of.
> Or do something with it that isn't guessing random numbers on machines 99.7% of which will never successfully guess a single block and go from factory to space heater to landfill.
By this logic we should remove airbags from cars also-- the vast majority of airbags just cost money to manufacture and don't ever expand or save a life, ending up in landfills unused.
I'm genuinely having a hard time following your argument.
An anti-efficient transaction processing system (that gets less efficient the more people mine) managing 2-3 transactions per second is the same as ... airbags ... because they're not used in the ideal outcome?
The majority of electricity used to mine bitcoin (about 100TWh per year) is coal, and coal kills about 25 people per TWh generated. So it's steady-state responsible for about 1000 deaths per year if we assume only 40% of the power is coal. The Verge says its about 85% coal and gas. [1]
What's the quantity of resources consumed by airbags at rest?
Bitcoin doesn't 'just cost money' to make, it consumes wild quantities of power and yields wild quantities of e-waste. 100TWh per year and 54kT of e-waste.
If we followed this model, would you be ok with each laptop you buy yielding 333 identical laptop in a dumpster somewhere ... because airbags?
Like I said, I'm having trouble following this argument. Is there a chance your argument is less about airbags and more about, er, somewhat heavier bags?
Your argument (I think) is that bitcoin mining machines that don't solve a block directly are a complete waste, and only bitcoin mining machines that that solve a block do anything useful. Since 99.7% of mining machines don't solve a block, bitcoin is 333 times more wasteful than in needs to be. Is that right?
This misses the point that mining is probabilistic. Mining pools pay out based on the number of hashes tried, not the number of blocks solved. Your misunderstanding seems to be that the utility of something can be based on a probabilistic outcome. It is akin to saying that airbags are 99% (or whatever) wasteful because most of them aren't actually involved in a crash, and therefore 100x inefficient. You pay extra for a car with an airbag because it has value in the rare event you do have a crash it has immense value. Similarly, a mining pool would pay a single bitcoin mining rig to mine for years without it solving a single block, because the mining pool would realize the entire value if it did find a block, and so it pays out just under the expected value of this reward times the probability of the event happening.
Second, your argument ignores the fact that the unit of a "mining machine" is completely arbitrary. If mining machines were on average 2x larger and more powerful (but there were half as many of them), then by your argument bitcoin mining would be 2x less wasteful. That makes zero sense.
> Since 99.7% of mining machines don't solve a block, bitcoin is 333 times more wasteful than in needs to be. Is that right?
Absolutely not, it's millions of times more wasteful than that. You don't need to allocate a single miner to a single block and then throw it out. It's just so many order of magnitude more wasteful than it needs to be that it's hard to reason about. You should be able to run the entire Bitcoin network on a single Raspberry Pi. It's literally 2tps, each a few bytes.
> Your misunderstanding seems to be that the utility of something can be based on a probabilistic outcome.
There's no misunderstanding. The kWh and kT of e-waste don't need to happen, it's just a poorly designed proof of concept that ran amok.
> If mining machines were on average 2x larger and more powerful (but there were half as many of them), then by your argument bitcoin mining would be 2x less wasteful.
No, I'm measuring waste by weight, in kilotons per year. In addition to energy consumption. So if a machine was twice as large it would contribute the same amount of waste in both columns.
OK, let's make this a multiple choice question. Assume bitcoin mining machines magically each become twice as powerful, AND twice as heavy, but there are half as many of them, so the total energy and resources used is exactly the same. According to your argument is this change:
a) good, because now twice as many miners actually solve a block, so instead of 99.7% waste it is 99.4% waste.
b) doesn't matter, because I just changed the unit of measurement-- each machine is just doing twice as much work.
c) doesn't matter, because bitcoin is already infinitely wasteful-- in which case pointing out that 99.7% of machines are somehow more wasteful than the other 0.3% does not make sense.
Same quantity of power consumption, same quantity of electronics, same waste. The more powerful the machines get the more 'difficult' the 'problem' is to solve. These machines don't do any work unless they successfully guess the nonce. The bulk of its time is spent wasting power. Doesn't matter how many boxes you split it into or combine it into.
Would you then agree that your original point that "99.7% of machines do not solve a block" is not by itself an argument that bitcoin is more or less wasteful than it needs to be? Because through a bookkeeping trick you can reduce or increase that figure by an arbitrary amount.
Was that really what this thread was about? It's just a way of visualizing how wasteful it is because most people just don't realize what 50,000 tons of electronics per year thrown out means. Or what 100 trillion watt-hours means.
It's 99.7% of machines based on the characteristics of the current most efficient miner.
I gave all the relevant waste metrics. Power, weight. And to help visualize, the quantity of the current best-in-class miner.
This is legendary pedantry. You can multiply and divide out to get any of the three measures of the scale of waste from the others. This whole thread was about you disliking 'P' in 'P=IV' but having no issue with 'I', 'V' or the idea you can multiply them together.
Look, you are touting a metric that you agreed has no bearing on the argument you are trying to make. The number of machines does not matter, it isn't part of any meaningful equation at all. Akin to summing the miles per gallons per car over the number of cars to measure efficiency.
Not to detract from anything you said but I read that Texas specifically is unique in that they don’t want to connect to the national grid to avoid being regulated by the federal government. It creates other problems like we saw in 2021 as well
If they are gapped out on transmission capacity, then they can produce it but can't send it to India, in which case doing something locally with it woukd be useful.
Per a Bhutanese source, it has been mining BTC since it was 5000$. Also, the electricity is free so it hasn't lost any serious money given the low expenditure. Last time BTC was 5000 was in Mar 2020 so given that they are still doing it, I don't see why this is unprofitable for them. If it was, they would have stopped by now.
It seems likely they felt they can get more for it from mining Bitcoin. Surely they’ve done the math. Why would a country, like a business, choose to make less money?
Because it's worse for the world. They have a tremendous source of green energy, and they could sell more of it to India reduce the amount of coal and oil India burns, but instead they use it to spin motors to power computers to guess random numbers and hope they make the rich a little richer.
Plenty of countries have chosen to have environmental goals at the cost of making less money.
I’m not sure Bhutan can afford to do that. It reminds me of when Western countries burned coal for 100 years to get where they are and then don’t want other countries to do that. I get it, and I don’t want the earth polluted either but it certainly smacks of colonialism/manifest destiny type thinking.
> It reminds me of when Western countries burned coal for 100 years to get where they are and then don’t want other countries to do that. I get it, and I don’t want the earth polluted either but it certainly smacks of colonialism/manifest destiny type thinking.
That kind of argument makes less and less sense the more you think about it. It's like arguing that Africa can't develop the Internet until after they get their telegraph network up and running. There's no reason that a functional power grid requires the use of fossil fuels as the primary energy source, and we're already at a point where renewable energy is as cheap to set up as fossil fuel plants. An advantage to starting industrialization later is you don't have to waste time working through worse versions of technology. If you want to be competitive, starting out on the latest and greatest is the best choice, especially because you often have a chance of undercutting existing providers who have too much sunk capital costs in less efficient technology.
This is great reply. This particular sentence is very pithy: <<It's like arguing that Africa can't develop the Internet until after they get their telegraph network up and running.>>
I can recall many, many years ago (20+), reading an article about the future of telephones. The article proposed that many developing nations would never install landlines with full penetration because mobile phones are so much cheaper. This was written in the era when mobile phones were still expensive. That blew me away.
East Africa has huge savannahs that are ideal for solar power. I've written here many times about the solar gold mine upon which both North Africa and the Middle East are sitting. I agree: There is a good chance that coal power plants don't make sense in the face of very cheap solar power. Also, many developing nations depend upon foreign capital / loans to build power plants. The lenders will very much prefer green energy over coal. What is harder: Tearing down coal power plants in developing nations. Why? The money is already spent to build a huge power plant.
I can recall many, many years ago (20+), reading an article about the future of telephones. The article proposed that many developing nations would never install landlines with full penetration because mobile phones are so much cheaper. This was written in the era when mobile phones were still expensive. That blew me away.
This brings back bad memories, and illustrates the risk of linear thinking: South Africa's black population was denied proper services under apartheid, including telecommunications. In an effort to supposedly right that wrong, the state-owned telecommunications company, Telkom, was given a years-long monopoly on fixed-line telecommunications in return for putting in fixed line connections to black communities. There were reports that an American corporation, SBC, helped write the country's telecoms act after it acquired a minority stake in Telkom.[1][2]
That monopoly set South Africa back many years, and it's only been in the last decade that it began catching up with the rest of the world. Oh, and the copper network has been so badly looted that many/most places now have wireless landlines. And those under-served black people: they all bought cellphones for the same reasons that people in the rest of the world did.
> If you want to be competitive, starting out on the latest and greatest is the best choice, [...]
That's not true in general. It depends on the specific situation.
You are right about learning from existing technology, and that people will not and should not blindly retrace the technological evolution, missteps and all, of those who came before them.
To give an example that combines both points: a poor country might be well advised to focus on bicycles instead of modern cars. But that doesn't mean they need to do a penny-farthing before they can get to safety bikes.
Possibly because there are hucksters whose entire life's goal is to convince others that soon rapture (hyperbitcoinization) will arrive and the believers (hodlers) will be rewarded greatly for their faith.
> Why would a country, like a business, choose to make less money?
For the same reason people got suckered by FTX and the same reason so many got burned in the many BTC crashes: They got taken in by the wild promises of cryptogains.
A lot of people don't understand energy markets. They are not basic commodity markets. They use weird pricing mechanisms and they are tied up with national security concerns on both sides of the border. They rely on a weird kind of distribution infrastructure. The product is consumed immediately, with no (realistic) way to store a ton of it.
Most likely there is a treaty setting a floor price on the power or a demand ceiling, and they have hit one of those. Those limits are negotiated based on all of these considerations.
Without specific knowledge of the agreements between India and Bhutan, or knowledge of the constraints on the network, plus other factors, your comment is hypothetical. I agree with some of your points.
I don’t agree with “They don't control the demand for their power” because Bhutan do have choice over how much they deliver, even if it is only in the long term via their contracts. Bhutan exports 70% of their power, so clearly India wants it.
As an aside, I have two very good friends who work designing electricity markets, and planning country interlinks. I am not a specialist, but I do try to keep up with the play.
> I don’t agree with “They don't control the demand for their power” because Bhutan do have choice over how much they deliver, even if it is only in the long term via their contracts. Bhutan exports 70% of their power, so clearly India wants it.
Without specific knowledge of the agreements between India and Bhutan, this is also hypothetical, and I have to say that it's a big assumption that "India clearly wants it." And even for economics 101 commodities, no supplier controls their demand curve or the optimal quantity to sell.
Bhutan has a monopoly on the locations within its border to put hydro dams. India obviously wants the power (and perhaps Bhutan’s economic dependency) so India has negotiated with Bhutan on how to build those dams.
I get your points, but ultimately Bhutan has control over building hydrodams within its borders, so it is controlling supply, so it does have a lot of control over the price. Of course you can come up with a million quibbles about the details, but you are just arguing yourself into a corner case.
OP’s point was: “Are you suggesting they cannot sell more [electricity to india]?”. You said “They probably can't”. Yet Bhutan is developing more hydro dams, and they are going to sell more electricity to India. Case closed!
Unless you can find some data showing that they are spilling water for $0 without generating electricity…
The part of India that neighbors Bhutan is extremely un/de-industrialized, and due to years of insane 'SJW-liberalism' driven politics, is as bad as the worst of sub-Saharan countries in terms of development metrics. India also gives away electricity for free to farmers (due to similar idiotic populism), and compensates by charging industries more (grid losses in India are also very high). To say that demand side is anemic is an understatement.
Bhutan doesn't have the best relations with Nepal either after the ethnic-cleaning of Nepali Hindus (1/5 its population) from Bhutan. Nepal, ofc, is as poor as India (though better than Bihar).
You absolutely can by investing in transmission infrastructure instead of wasting it on guessing nonces. It incentivizes continuing to waste it instead of transmitting to to places with productive uses.
Transmission is extremely efficient. A power line spanning all the way from New York to San Francisco should be about 92% efficient.
Transmission line losses are only about 2-3% per 1000km. [1]
Transmission loss can actually be reduced to zero, if voltage is infinite (or super conductors were used). However, the important part is the installation and operational cost of a high voltage line-- which is definitely non zero. For a small enough economic value of a far enough away stranded power source, installing transmission lines would not be economically rational. It is a bit like saying that every house should have 10 Gigabit internet. The technology is there, but the capital expenses are not reasonable for ubiquitous deployment.
If there's a small amount of power available then it's not worth mining. If there's a lot of power available it's worth building a transmission line. There's no rational economic system where the ideal case is build-to-waste - that's just policy failure. Bitcoin just provides economic incentive to create that policy failure instead of minimize it.
> If there's a small amount of power available then it's not worth mining.
Could you explain how you arrived at this conclusion? The value of mining is generally proportional to the available power. If the capital expense of a mining rig is less than a transmission line, it might be better to mine than to transmit. For example, if it costs 1 million dollars to install a transmission line, but only 1 thousand dollars to setup a mining rig that could consume all the energy, it probably be more feasible to mine than to transmit.
Mining does zero useful productive work. That's the point. That's how it has to work. It's literally a proof of waste system. Each unit of wasted energy should be spent doing something useful. If you economically incentivize waste, there's no market signal to utilize the power to productive ends.
So if there's a small amount of power, you get no yield from mining. If there's a lot of power, you can afford to connect it to the grid. If there's a medium amount of power, decommission some of the supply - or never build it in the first place. All three options are better that using it to probabilistically guess at nonces and prove you expended it on nothing of value - and get paid for it.
We are not measuring what YOU personally believe is "useful productive" work. We are measuring if there is a way to extract economic value (payment) for stranded energy.
> So if there's a small amount of power, you get no yield from mining.
You are going in circles. The amount of mining you can do is exactly proportional to the available power. It does not suddenly go to zero. If the yield or profit is greater than the costs, it is economically worthwhile.
Where did I say burn piles of money? I'm saying that if the transmission line is profitable, build it. If it isn't profitable and bitcoin mining is profitable, mine bitcoin. Both options should only be done if they are profitable.
This is the exact opposite of burning money. Your assessment whether bitcoin mining is wasteful or not is beside the point, the point is merely to unlock the economic value of stranded energy.
An Antminer rig is nearly $20k. A Starlink setup is $600 then $50 a month. Plus any other capital costs. If the electricity is "free" just the rig and Starlink satellite cost will take over five years to pay off assuming the mining revenue is $10 a day.
Who is giving free money to remote African villages to buy Bitcoin mining rigs?
For reference a milk cow costs about $1500 and can produce 2,500 gallons of milk in a year. For the cost of the Bitcoin rig maybe getting $10 a day a village could buy about 13 milk cows. Even selling milk at $1 a gallon that's about $88 a day. The "free" power can be used to Pasteurize the milk (UHT) for extra longevity.
That same $20k could buy a room full of laptops plus networking equipment and Starlink. They could take online courses to learn a variety of technical jobs and then do contract work for way fucking more than the $10 a day they'd get from a Bitcoin rig.
> Who is giving free money to remote African villages to buy Bitcoin mining rigs?
Why would it need to be free? It could be an ordinary investment that's paid off over time. (Though I assume that the payback period is probably quicker than 5 years, that seems a bit too long to be useful.)
Be careful about cows: there's quite a few charities who want to give out cows to help people (using the same logic as you do). But for many recipients the cow is a net drain on their resources. That same logic applies when buying a cow with your own money.
They could invite outside miners to set up shop in the village.
The miners would finance provide the capital, set up the mining rigs, and take all the bitcoin risk. The villagers would just sell them electricity. Just like they would sell electricity to any other business.
No clue whether that's what's happening in Bhutan, but it's a perfectly valid business plan, and pays the villagers right away.
So Bitcoin miners will just go to some out of the way village in Africa to buy electricity? I don't need to imagine electrical utilities, those already exist.
It doesn't make any fiscal sense to find some out of the way location with a small scale hydro generator to set up a Bitcoin miner. The amount the village would need to charge to make a worthwhile amount of money will certainly be above large scale utility rates.
The Bitcoin miner in remote African village story smells like someone taking advantage of some villagers. They're either paying them below market rate for electricity or indenting them with a Bitcoin mining setup that will barely pay for itself over years.
You only need a crazy efficient rig to mine Bitcoin if you have to still make money after factoring in your electricity costs; if you are given free electricity, you will be profitable using any existing computer you have to mine: you also won't be making as much money per unit of time, sure, but you will still be making money at that rate.
Mining rates are a few tens of cents per day per TH/s. Even with "free" electricity the payback time for a miner will take a long time. If you've got a non-optimized miner the payout rate would take months just to be measurable.
The article says a tenth of the entire country's inbound trade and 15% of the entire government budget was spend buying "computer chips". And that this has "fueled a yawning trade deficit and tallied with a sharp drop in the country’s foreign currency reserves."
Maybe they'll get a good return on "the $193 million spent on computer chips" plus whatever they spent to build hydro power plants to tap that "more or less entirely unused" resource? How much would you bet against the only real money ever made here ending up in the pockets of pork barrelling politicians and bureaucrats getting kickbacks from the mining rig vendors and hydro dams/powerplant construction contractors?
That's one of the rebuttals to "Bitcoin is wasteful" in terms of energy and the environment. Bitcoin isn't taking power away from anyone who needs it. It's very often stranded power, like you said, that is too far from a city to be useful efficiently.
Sometimes it is waste energy. Sometimes it's useful energy that the local market cannot afford but could easily use it to make everyone's lives better. Sometimes it's just a random quirk of markets that they get first dibs on the electricity. And in at least one case, a decommissioned coal plant was purchased to be restarted just to mine bitcoin.
Bitcoin makes people's lives better. A lot of people use it as a savings account. That's really great, especially for people living with a hyperinflationary currency.
It's actually good to have as an alternative to any centralized, government-backed currency.
We need an economy that isn't denoted on dollars or euros or similar. Bitcoin is a step towards that. And all the PoW "waste" is worth it. (Though I wish there was a better alternative that's more environmentally friendly while still decentralized like PoW so PoS isn't a good candidate)
Stocks -> can be seized by governments where the exchanges or actual companies are based.
Gold -> Good, and Bitcoin is like Gold in many aspects. While it doesn't have Gold's history yet, it has a few other qualities like easy transferrability and divisibility.
Other assets -> Like? ForEx is at the mercy of issuing government (just ask Russia who lost ~300B$). Land can be seized if it's outside one's jurisdiction.
In general, Bitcoin (like Gold) is a great asset to park some fraction of your wealth as a hedge against geopolitical risks.
It's difficult to buy stocks if you don't even have a bank account. Why wouldn't Bitcoin be a "savings account"? I use it as a savings account, it's really great. I put money that I don't need today there so I can have the same or higher buying power in the long term, regardless of inflation.
If I put money in my savings account, I can use it tomorrow. If you put money in your BTC savings account a year ago, your BTC is worth less than money under a mattress (or in a modest yield savings account).
You may want to invest in BTC, and that's absolutely fine! But it's not a savings account.
And it's very often _not_ stranded power, too. And there's no way to ensure it's _only_ stranded power being used. If it's more efficient to turn power into Bitcoin than to sell it to your neighbour, well, the fuel gets burned and turned into CO2 and Bitcoin instead.
Energy use for cryptocoin mining on average drives up the cost of energy for everyone. Maybe not a lot, and maybe the production side expands. But if it is using fossil fuel to generating electricity, it is also harming the planet via climate change and pollution.
What happens when costs get high? People innovate! When demand for bitcoin increases, more money will be invested in cheaper and more abundant power sources.
Isn't it? I see a lot of investment in decoupling supply chains from China which was a single point of failure and contributed to inflation when it closed down. Also a lot of investment in renewables or alt-energy sources after Russia decided to use NatGas as a tool in its current war.
It's not like city or bitcoin are the two options. They could be processing bauxite, or something like that. I guess they'd need to invest in some rail first, but building up their industrial capacity should benefit their country more in the long run than printing funny money.
Which would also, presumably be stranded at above baseline rate. Infrastructure like roads and pipelines is much more expensive than a starlink box which can move BTC.
Well, if energy is locally cheap but difficult to export, it's not surprising that somebody tries to find a use for it, and really not that surprising that it's being used for computations. But since mining bitcoins is sort of a zero sum game, it might be better if the energy were used for some computation that actually added value to the world, if such a thing exists.
Mining bitcoin is also a zero sum, if other miners aren't allowed to leave the business.
If someone in place A with cheap, stranded power enters the mining business, the difficulty of bitcoin mining will increase, and perhaps enough to convince a miner in place B to exit, and thus free up some energy there to use in another productive endeavour. Be that for computation or for a different use.
In this sense bitcoin mining acts a bit like a pneumatic system to 'move power around' in a virtual sense.
I specifically use pneumatic as the analogy, and not hydraulic, because hydraulic fluids are incompressible.
My example assumed for the sake of simplicity that people starting bitcoin mining in A would drive up hash rate and thus difficulty enough to make mining unprofitable on the margin in some place B.
The electricity used for mining in B before can now either be used for something else, or the people in B can produce less electricity and save on resources.
Eg it used to be profitable to mine on your PC. Those days are long past: the returns don't cover the cost of electricity. Hence a shift away from that.
A, I imagine, very useful invention would be some sort of synthetic fuel generator that only needs water and could soak up a lot of this energy. How small can your fuel synthesis pipeline be?
This issue of power in weird places could be aided by processes that make… well, something useful.
I don’t contest that if the point is money the bitcoins are… probably better? The risks involved with bitcoin custody being their own can of worms. But at least fuel serves a purpose (especially in remote areas!)
Apparently a lot of the UK's wind power is wasted because they're forced to stop the turbines when there's too much wind. I guess we could be doing something with that excess energy, not sure if Bitcoin mining is the best option though.
- the wind exceeds the safety rating of the generators, due to either vibration, blade stress, or thermal issues
Increasing demand only helps with the first scenario, whereas I suspect the latter two are more likely reasons in the UK (esp with so much generation stranded up in Scotland).
The impressive part is almost that the paper money managed to drift so far from inherent value as it did. Crypto brings it back to being correlated with effort.
> I think it's kind of wild that you can just take a latent or otherwise inaccessible source of power and now convert it into waste heat
Fixed that for you. Bitcoin mining does about as much good for society as hooking up thousands of 1500W electric resistive element space heaters and dumping the thermal output into the atmosphere.
Might as well install some mini split air conditioners backwards while we're at it.
When energy is stored in the height of water, if you don't turn it into electricity and let the water flow freely then it will turn itself into waste heat.
This is written like the construction of a hydroelectric dam on an intermediate point at any elevation change in a river is an inevitable law of nature... ?
It's a choice whether to build a dam or not, but that choice will not change the amount of heat generated.
You could put that power to better use, but if you don't have something lined up then the waste of idle turbines bypassed by water is just as bad as the waste of mining bitcoins.
Hydro dams typically store water uphill for later. If you use it now, it's not there to use later.
In the case of a 'stranded' dam, there isn't likely to be a reason to generate power either now or later, so you might as well run BTC generation. I suspect this has been the motivation to build an awful lot of 'stranded' hydro dams, though...
You can store water in the short term. The long term view is simpler. The storage will eventually fill up if you're not using all the power, and at that point you either find a use or you dump the excess water and cause just as much waste heat.
So are you saying if the government wanted to subsidize chip development and had these choices:
A) Make resistive element chips out of wafers and all the normal complex chip patterning, using up the fab side of things and wafer space
B) Subsidize custom chip molecular simulation accelerators for cancer research, by providing the fab side of things and wafer space to design researchers or companies
I'm saying that over the course of several years, A is better for chip advancement and availability than nothing at all. And in the real world it's A+B vs. just B, the same amount of B in both scenarios.
I'm not aware of Bitcoin reducing any cancer research budgets anywhere. Are you?
This would be like the government proposing buying up a big portion of argricultural tractors and running hours on them until their engines wear out, in order to help the economy make more tractors. Cash for clunkers without the environmental rationale.
That would be bad because of the CO2 emissions and because it's a huge waste of government money.
It would not be bad for long-term tractor availability, if they kept up big purchases for many years. Especially if tractors were a hotbed of research and improving by orders of magnitude.
Or to put it another way: It's a hugely inefficient way of boosting tractors, but it will in fact boost tractors. It's not a good idea overall, but it will have some positives.
Do you not think supply and demand applies to building chip fabs, or something? And economies of scale?
I'm serious when I say that if there was less asic demand in 2015 and 2018, no matter what the asics were for, that might have reduced the asic capacity in 2021 enough to make the problems we had even worse.
Check your financial privilege buddy. You may think that because you get paid in the world reserve currency with low inflation. Others are not as lucky, and this won't always be the case. Heard about de-dolloraziation?
And Bitcoin is so stable and international accepted and not able to be attacked by a 50% attack that it's better to use in a crisis than gold and food?
Have you seen someone trading worthless money into BTC in a crisis? No you have not.
Either you keep Bitcoin and start really using it globally or this argument is wrong.
Stability is an illusion. Everything is fluctuating in value every day. Some would argue that given bitcoin's fixed supply, it could be an asset against which everything else value can be measured accurately. An economical measuring stick, if you will.
> International accepted
Yes, except China!
> 50% attack
Buddy are you still in 2013?
> Crisis
Yes, there are some accounts of people fleeing the Ukraine war with their savings in a USB stick, Bitcoin sure is great in a time of crisis where criminals would be on the look out for shiny metal!
> start really using bitcoin..
What are you talking about? I'm using Bitcoin right now! I use it every day especially when I am soundly asleep knowing that my Bitcoin is safe and my purchasing power will grow in the long term.
Given your username, one would assume that you know the 3 uses of a money. But you know what they about assume-ing. I use bitcoin on a daily basis for the most important usage of a money - store of value.
I'm honestly not sure if this is rhetoric that's coming from the point of view of like a die-hard cryptocurrency true believer free market US libertarian, or somebody that's fully on board with the Russian and Venezuelan governments' stated anti-dollar perspective on global economics.
The whole globe should be Anti-dollar (and anti-government money from any country)! What gives the US the right to the global reserve currency and the power to export inflation?
Whatever you get paid in, you can convert the money into whatever currency you feel like afterwards. (Unless your country has weird capital or exchange rate controls, of course.)
Climate change will be expensive regardless of "shitcoins".
Those "shitcoins" at least pave a way to take power from large entities whose best interest isn't saving world's climate, doing more good than harm indirectly.
Unlike video games, maximizing energy waste is the goal of proof-of-work. The more energy wasted, the more money you make. It's an engine of conspicuous consumption, which makes it more dangerous than any leisurely pastime where energy is merely an input.
It's not wasted any more than it is wasted when you play a game or watch a youtube video or TV. It's just a use of energy which you are trying to make as somehow bad. It's just a cultural preference.
No, because if someone invents a way to power YouTube free of energy, that would be awesome, and it wouldn't detract in any way from the value of YouTube.
But if someone worked out a way to generate BitCoin for free without any energy input, that would destroy BitCoin, because it depends on proof of work, where work is defined as consuming energy.
Speak only of your own willful ignorance. Nobody said anything about inefficiency; ASICs are extremely efficient at wasting energy. The point that Bitcoin proponents refuse to admit is that, unlike other systems, making the components more efficient does not reduce the energy consumption of the system, because energy consumption is the purpose of this system.
Even worse, it puts a floor on the price of energy, which disincentives everyone else from seeking more efficient solutions to power production, because all that efficiency will be wasted by proof-of-work anyway. We as a species will never have free energy, and this is the reason.
Bitcoin is extremely centralized. Every transaction is recorded in a centralized ledger. That ledger may be distributed, but that's not the same thing as being decentralized.
There's nothing preventing anyone from mining blocks, either individually or in a pool, and broadcasting newly found blocks to the network to be permanently and uncensorably added to the ledger.
While the sibling comment has answered on why this is nothing like social media or video games, I do wish that the energy cost of these activities was taken into account more often. Video games in particular have become massively wasteful. Just downloading these 100GB behemoths expends useless energy. And everyone is pushing for 8K 172FPS games. Why? Just why?
And yes, before you answer, that applies to any hobby you can think of. You won't be astute by pointing out that e.g., car enthusiasts are similarly wasteful.
I would pay someone to show me how to actually set it up and expolain where to advertise my pinning service. I can find almost no useful information on any of the above. Looking forward to MaidSAFE launching soon.
Nah, I have access to a lot of storage resources at the moment, not money, that’s why. I want to earn block rewards for storing files.
Also I don’t believe in staking or trading because it’s a zero sum game that you are just as likely to lose as win (if you don’t have an edge). Earlier this year I debated Richard Heart about staking Hex vs actual utility and open source software:
Although I seem to call it correctly (March 12: buy way out of the money put options at $4 strike on FirstRepublic) I am too busy and overwhelmed to act on it (deposit money into RobinHood, have it clear, time my entry etc.)
> “It’s concerning that Bhutan's resources have been invested in a secretive manner in a highly volatile and risky investment which has a big environmental burden,” says one former international advisor, who asked not to be identified.
Hahahah. Why? First world nations do this on the regular.
> “It’s concerning that Bhutan's resources have been invested in a secretive manner in a highly volatile and risky investment which has a big environmental burden,” says one former international advisor, who asked not to be identified.
Ugh.... that comment just reeks of Western privilege. What Bhutan does with their resources & energy is of no concern to any outsiders, unless they're involved in said operations themselves. Reductively, the advisor's comments just say:
"They shouldn't be able to do X with their own resources. WE know what's best for them, not Bhutan."
If you follow Major Jason Lowery at all, https://twitter.com/JasonPLowery, this seems to align with his thesis of bitcoin proof of work mining becoming a form of power competition and warfare between sovereigns.
Given that human prosperity is directly correlated to the amount of power available for productive uses, the fact that proof-of-work incentivizes wasting power means that any state that competes in this way is directly lowering the prosperity of its citizens.
All warfare is a waste of resources, but those who decide to become pacifists are eventually out competed and subsumed by those who maintain the art of war.
I'd love to know if you've found a solution to this dilemma.
> All warfare is a waste of resources, but those who decide to become pacifists are eventually out competed and subsumed by those who maintain the art of war.
They are using 'pacifist' in a rather loose sense.
So: Switzerland ain't wasting resources on warfare (though spend a bit on keeping their defenses working), and they aren't 'out competed and subsumed by those who maintain the art of war' either.
Your remark about profiting from other people's wars is a different topic.
This shows that they are very slow, even think tanks in US should have noticed and publish this before.
In the next article [2] I put the focus in the interoperability as the core tenet of blockchain or whatever technology you want to invent to set a better standard for global currency standards.
In reality, it's a bit more complicated, because states are run by people, and those individual people have interests, not the states.
The latter consideration helps to understand why eg the US invaded Iraq in the 2000s but then didn't take their oil (as your 'control of scarce resources' theory might predict).
I'm deeply skeptical of crypto, but if you have to build mines somewhere, Bhutan is one of the less bad places to do it: cold climate and plenty of hydropower. And it's still more environmentally friendly than other options for soaking up excess power, like giant aluminum smelters.
Except that giant aluminum smelting is going to happen regardless to make drink cans, MacBooks, and Teslas, among other things. Wouldn't you rather it be powered by renewables than coal?
Bitcoin mining can be thought of as a way to convert energy to $$$ without any transmission costs (long distance wiring, transformers, batteries, etc.)
So, if you have a power source, and it is too far from where energy is needed, just use that power source to mine, and make bitcoins.
I'd say it is even revealing of a particular worldview. Even within the article, the impression seems to be that the people of Bhutan (and the author) NEED or deserve to know about it.
Good. We need more countries in power against the big ones like US or China. While what they have is probably nothing compared to big countries, it's a step in the right direction to get rid of US dominance on economy.
That doesn't seem very likely. Even just looking into the topic of the Doklam plateau makes it clear that Bhutan is vulnerable to all kinds of changes in attention.
If they truly are not fazed in some general way, it seems more likely that they would not be fazed simply because they live within a geopolitical program which has been defined by external entities.
In other words, perhaps they must live out an existential perspective, because other paths of political expression are essentially locked up.
Related, I wonder about the locus of control with regard to crypto. Who is managing their interface to their crypto, which intelligence agencies from other nations may be effectively overseeing it, etc.
Not to dispute their sovereignty, but I'd imagine the latent vulnerability level would be extremely high if the crypto position is anything near significant enough to threaten key political negotiation parameters.
Bhutan is effectively an Indian dependency, but it's also a small country with a long border with China and has to dance on an awkward tightrope to keep both sides happy.
> it had begun mining “a few years ago as one of the early entrants when the price of Bitcoin was around USD 5,000.”
The most important bit of evidence that nobody there knows what they're doing and that the crypto grifters have swindles an entire country's government.
"Early entrants" were mining in 2009/2010. Maybe even as late as 2012 or 2014 might count as an "early entrant" - around the first halving and when the difficulty jumped past 1.0E+6
And it doesn't really matter what the price of BTC is for something like this, as the resource is more or less entirely unused. It's just sitting there, doing nothing, so any value you can make out of it is better than the nothing they're already getting.