Originally published at: Energy efficient cryptocurrency still emits as much carbon as 2-3 coal plants | Boing Boing
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That… doesn’t sound small to me. Especially for an utterly unnecessary money laundry scam.
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Then there is the cost of producing and disposing of all the electronics used.
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Please revise this, as it is only going to be correct for another few months. Ethereum is converting to proof of stake instead of proof of work. That will cut its energy use down to about 1 wind turbine’s worth annually. The May 18th post on Ethereum’s blog explains it well.
In late 2019 the Ethereum Foundation launched a test network called the Beacon chain that allowed anyone with 32 ETH to stake their ETH for the right to attest other peoples’ transactions and create new blocks with a simple computer program that can be run on a very small and energy efficient computer (these are known as validators). This differs from proof of work, which requires a powerful computer to solve a complex math problem to earn the right to validate transactions. This is known as mining.
So the network is energy intensive now, but will not be when the test chain merges with the main chain sometime in the Spring of 2022. At that point miners will go away and transactions will be secured by validators and the energy use of validating transactions will go way down.
On the point of this being a scam, this is no different than Visa/Mastercard networks validating point of sale transactions. Instead of enormous buildings with multiple people involved in the process, the blockchain allows a decentralized and much more efficient and people-free process to play out that does the same thing. With proof of stake validating, it will be more energy efficient than the current system by multiple factors.
I was lucky enough to have Prodigy internet through a 9600 baud modem that ran over our phone line to our 2286 12MHz computer with 640kb of RAM. We literally downloaded the entire internet. Blockchain feels like that to me now. The user experience of the early internet wasn’t all that great either, and the use cases were limited to whatever technophiles were interested in producing. There are a lot of potential use cases for a decentralized ledger. The coins are just the currency you pay to use it - we also paid Prodigy to access the internet in the same way.
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Also… I doubt many here are defending the credit industry…
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Name some. And preferably ones that can’t already be done just as efficiently with systems we already have. And preferably ones that don’t involve creating bigger problems because of the inherent nature of blockchain. And preferably ones that don’t end up sounding exactly like ponzi schemes. And if you can manage ones that are actually decentralized (rather than merely being claimed as such) then all the better. So far, I’ve been offered some JPGs of badly-drawn gorillas. I’m thrilled.
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Every crypto fanboi every time
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I do wonder how that compares to the credit card processing networks. Consider all the call centres, bank processing, and human power needed to keep the system running, and all the electricity that uses. It’d be hard to capture all of it, but I bet it adds up to more than 2-3 coal plants.
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SEE ALSO: “clean coal,” “recyclable plastic”
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Fuck the planet and having breathable air and clean water; privileged people getting richer is the only thing that matters!
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Mood stabilizers can help
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Funny thing, the market moved up 600 points today yet Bitcoin and other cryptoscams continue to drop.
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That would definitely be nice to see. Both for the reduced energy use, and for the novelty of seeing that sort of major software change roll out on time. But as with everything where there is no foxed purpose, just a scramble to do as much as people can manage, I assume the result would be more on the Ethereum blockchain rather than less energy.
Meanwhile the planet is on fire now.
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From the anydaynowrealsoon tech file. See also the self-driving cars that will make Uber’s business model more than a scam.
For the blockchain, yes, but cryptocurrencies are only one general application. A blockchain ledger can exist without them. Besides speculation* on the exchanges and PR stunts, the main use cases for cryptocurrencies are things like money laundering, buying expensive illicit goods, and a few other low-trust slow-velocity scenarios. Which is another reason that there’s a problem with proof-of-stake, which relies on giving humans…
[* speaking of which, how’d you enjoy yesterday’s ride?]
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Exactly! We’ll just breath Perri-aire (bottled from druidia!)
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Note I said potential, since a lot of the projects that are getting off the ground are in their early stages, but the use cases are obvious. Most of the systems we have for financial settlement involve a lot of middle men. Since blockchain is trustless and secure, you no longer need the middle men. This saves end users money. And yes, people are buying digital goods on the blockchain. They also buy them in video games. What’s the difference? An NFT is just a Fortnite skin with a permanent proof of ownership.
A few use cases:
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Settlement. Currently done by a cabal of banks in an automated clearing house that allows banks to rearrange transactions to cause overdrafts, and two large credit card companies that control all point of sale transactions. You might notice a wire transfer costs $30, Visa and Mastercard take 5% commission from small point of sale to just transfer money back and forth. Lots of offices with people and proprietary databases. Trillions of dollars in annual transactions.
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Property tax liens and mortgage transactions, and other transactions involving government servcies. If you’ve ever closed on a house, you’ll notice there are title companies that get paid to make the payment transfer - about $250 to update a database. Have you sold a car and had to go to the DMV to show a person proof that you need to update the title, and they give you an official looking piece of paper? You could easily write software to automate this through a smart contract at the click of a button. Since the blockchain is permanent and distributed, you don’t need a DMV to provide this service with paper.
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File storage for the distributed web, or public-goods like Wikipedia that require donations to keep afloat. Currently we pay for the internet by giving our data away for free and are served ads. Projects like Filecoin and Brave are working to pay directly for services using crypto currencies. With Brave you can now get paid to be served ads if you choose to do so, and no one tracks your movement on the web as the Brave browser blocks it as a default.
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Retirement plans. We currently pay brokers a commission to connect us to public markets per transaction, and then we pay them again to provide a website where we can look at how our funds are doing. This amounts to tens of thousands of dollars by the time you retire. Stock certificates can easily be put into smart contracts.
The economy is built on consumption of goods and services, with sovereign dollars as a medium of exchange because trading a barrel of fish for two bags of wheat is cumbersome. In the last few hundred years, businesses and services for exchange have become more sophisticated to make the transaction of dollars even easier. Blockchain is just the next iteration of that.
The user experience of blockchain still needs work, but you’ll see a lot of companies come in and make that experience easier. Once that happens you’ll see these use cases proliferate.
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One note here. You can’t have a blockchain without crypto currency. You have to incentivize individuals to maintain copies of the blockchain and verify transactions. Each blockchain has its own coin for this purpose. I run an Ethereum validator and get paid in Ethereum to validate transactions. Currently this is only happening on a testnet, but it will validate live transactions starting in the spring of 2022. If I don’t keep it running well, I will lose money.
There are tokens as well, which are not coins. I only see a few public blockchains surviving beyond this early run, and tokens will survive if the project they are used in survives. Coins for successful blockchains will increase in value if the blockchains are used.
There are a lot of scams, and there are a lot of people falling for them, so there will be a correction and the balloon will pop. Same thing happened with the early web. Some of the companies that folded were just early, or they had a bad user experience that technology eventually fixed and they ran out of time. Others were outright frauds.
I also see the legal and tax issues, however, I’m not sure the argument that more money laundering and tax evasion is happening in bitcurrencies holds. Major blockchains are public, which means if you know the address of a wallet, you have a permanent transaction record that can be used in a criminal case for any sized transaction. It’s a little more risky than having an offshore account that is protected from oversight by privacy laws.
I’m also not sure why you have an issue with proof of stake - maybe you can explain that. You’re giving humans a monopoly on verifying transactions now. I assume the technology has made the cost of verification for Visa and Mastercard much lower than the 2.9% + $0.30 they still charge. They haven’t lowered their prices. Their profits are in the billions.
In Ethereum there are 266,619 validators currently. They all put real money in stake to get paid to verify transactions. The day that is no longer worth it to them, they will leave. The price that people are willing to pay for making transactions will set that price, not a middle man company. The cost of running a validator is minimal, probably less than $3 / month depending on where you are. That will drive the price per transaction down once blockchains can handle the scale of transactions. That can only happen with a proof of stake blockchain - proof of work is too slow.
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- I’d argue is where you want the State involved. In England & Wales we have to register all house sales, it ends up in a database with a public API. I’d rather that a court reference a state database over a crypto-ledger.
2a: We’ve seen this week that smart contracts attract the sort of person who believes they can write bug-free code. In the event of a bug in a contract we want the courts involved, not a processor. - File storage? Just the text on English wikipedia is ~42 GB, with 1.9 edits a second. The PoS Etherium will write a block every 12 seconds, is there enough room in Eth to write 23 Wiki edits to it every block? Would this cost more, or less than just running a seedbox?
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