Even more people will realize it’s an elaborate scam?
Can someone explain the energy issues behind bitcoin? Is it an elaborate metaphor for loving money being a huge and dangerous distraction?
Anarcho-capitalists will have long moved on to another weird scheme to re-invent the wheel where THEY get to get all the free capitol … with hookers and blackjack.
There are hundreds of shipping container server farms running 24x7 in eastern WA dedicated to crypto currency mining and any available commercial space there is used for it as well.
If there’s any person to make you miss the ‘sanity’ of another Tim Ferriss video,
it is Heidi, the wonderful second-citizenship lady.
EDIT: Also, I’m not so knowledgeable of the conventions of the bitcoin community, but does everyone so casually refer to Satoshi Nakamoto as if he were a real identity? It is still unknown as to who “he” (or the group posing as him) is, or if he/they are even still alive.
I suspect that a few of the factoids related (like the one in the summary) are a little sketchy, but this gives you the overall picture, the overall energy-based argument against Bitcoin.
In particular I don’t think Bitcoin transactions require such a high energy input (although they certainly require more than an ordinary banking system does), but that these sums of energy are expended for each transaction as many miners compete for increasingly scarce rewards. The system could work with far less energy than it does, but it’s so far been profitable to expend the energy.
here is an interesting article with a point of view about the bitcoin power use articles:
https://hackernoon.com/the-reports-of-bitcoin-environmental-damage-are-garbage-5a93d32c2d7
wired magazine said bitcoin was dead in 2012!
Hydro-Québec recently allocated another 300 megawatts to crypto, on top of the 368 MW already approved or in operation.
At typical (non Quebec) [North American conversion rate of 650 homes per megawatt] (https://www.boiseweekly.com/boise/megawhat/Content?oid=3433953), that’ll mean crypto in Quebec alone will be consuming power at the same rate as over 400,000 homes.
Well that is an interesting article, after a fashion.
He launches directly into ad hominem in his opening paragraphs, his writing is full of unnecessary adjectives and insults, he’s “shocked” that Joe Six Pack doesn’t understand the finer points of the power market, etc.
I feel like I could rant about this for a long time, but I’ll just mention two things that seem like really big issues to me:
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Author says hydro power is under-utilized, that the power can’t be transmitted efficiently, so it’s just wasted if we don’t spend it on crypto mining. If that were the case, why were the hydro facilities built in the first place?
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Author points out that the power grid is a complex market/network that involves a lot of transmission, pooling, swaps and trades, i.e., that power flows in many directions and that it’s all interconnected. Then he goes on to ignore that idea when he argues that crypto isn’t powered by fossil fuels but by renewables. Every watt-hour of renewable energy you spend on one activity is a watt-hour that could have been spent on something else, something more obviously constructive. Even if you’re locating your crypto system close to hydro power, you’re still causing more coal to burn in the end.
These are really basic, obvious, non-expert level issues and he doesn’t even acknowledge they might exist.
All of the writing with this author’s name that I’ve found is about persuading other people that crypto currency is great. If it’s so great, why does it need so many prophets talking it up? He supposedly CEO of “Reassure Financial Limited.” It looks like there was once a website for this company but it’s down right now.
That used to be true. But then people started ganging up and buying these obscure specialty boats that mine fishcoin like crazy. It basically chased the basement fisher devoting a few of his time-cycles per day to fish-mining out of the market.
Also from that article:
By July 2019, the bitcoin network will require more electricity than the entire United States currently uses.
I don’t remember hearing about bitcoin swallowing the U.S. power grid last month. Obviously there are problems with bitcoin but the article turned out to be a bit alarmist didn’t it?
And if bitcoin is draining so much power – 9 homes per transaction – then someone must be paying for this power use…where is the money coming from, who is paying for it? That’s what makes me doubt his statistics. If bitcoin cost that much per transaction, people wouldn’t use it, unless they aren’t seeing the costs, and if they aren’t, who is?
Yes, and there were many economists saying the housing market was headed for an imminent crash in 2002.
Were they wrong, or just early?
Because power plants and hydro facilities especially are built with projected future usage in view. While you can add wind turbines one at the time, you can’t do the same with a dam, at least not easily. So they build this sucker big (enough) because the whole point is to have the energy at hand so the region can develop.
Here’s the way I read that factoid:
…at bitcoin’s current growth rate … By July 2019, the bitcoin network will require more electricity than the entire United States currently uses.
And I believe the point was: The picture that motivated parties were painting of bitcoin’s growth, circa 2017, was not sustainable or realistic.
And if bitcoin is draining so much power – 9 homes per transaction – then someone must be paying for this power use…where is the money coming from, who is paying for it?
The miners pay. That’s why they seek cheap electricity.
They’re hoping that they earn $1.10 for every $1.00 worth of electricity and equipment they burn up. Mining is part of the act that provides the computational infrastructure to support the blockchain transactions. The people making actual Bitcoin-for-goods type transactions may pay small fees, but they’re not remotely enough to subsidize the whole electric bill. That is the design (at least, that’s my understanding). The mining rewards exist in order to incentivize someone(s) to provide the computer power necessary to make the network function.
Edit: Since the number of possible Bitcoins is finite, and since some level of mining incentive will always have to be provided to keep the network going, Bitcoin is inherently deflationary; it can only work if the value of the individual coins keeps rising enough to keep mining profitable, even as mining difficulty grows and mining rewards shrink over time.
Bitcoin mining ghost towns?
Ultimately, yes. However, I think you can move the graphics cards to a cheaper place, but it’s probably cheaper to get new and more powerful ones.
It’s a tangential point at best, but GPUs have been too weak for Bitcoin mining for a few years now. Bitcoin mining happens on custom machines built around custom chips.
And the only reason I think it’s worth mentioning is this: When the Bitcoin mining equipment becomes obsolete for Bitcoin mining, you’re not even left with a pile of slightly behind-the-curve but potentially-useful equipment like GPUs; you’re left with custom-made trash.
There are other, less famous, less useful crypto coins that can yet be mined with GPUs.
Perhaps someone could extract metals like copper, lead or gold from the boards?
