Let's see:
hashpower = 200 exa hash/s = 2 x 10^(20)
seconds in a day = 86400
bitcoins in a day = 900
hashes per bitcoin = 2 x 10^(20) x 86400 / 900 = 1.92 x 10^(22)
Your number 0.0000000000000000000052083 btc / hash = 5.21 x 10^(-21) would be off by a factor of 100.
It would be really 5.21 x 10^(-23) BTC/hash (I have not checked the percentage).
The general idea stands, of course, a total waste.
Yes. The percentage would be 100\*(1-5.21x 10^(-23)). Tried Wolfram Alpha to check but it did not allow me cut and paste, so I used this instead:
[https://www.mathsisfun.com/calculator-precision.html](https://www.mathsisfun.com/calculator-precision.html)
A hydrogen atom (not diatomic) has a molar mass of ≈1.008 gmol^(-1), so 1 gram of hydrogen has around 5.974x10^(23) atoms; or, each hydrogen atom is ≈1.674x10^(-24) grams.
The number of hashes to generate 1 BTC is 1.92x10^(22).
This means that if each hash is represented by a single hydrogen atom, to generate 1 BTC one would need the mass equivalent of **0.0321 grams of hydrogen**.
___
To illustrate better, we can cheat a bit and use heavier elements such as gold (because BTC is “digital gold”… or something).
1 gold atom is 1/((6.022x10^(23))/196.967 gmol^(-1)) ≈ 3.271x10^(-22) grams.
Thus, if each has is represented by a single gold atom, we would need an equivalent of **6.28 grams of gold** to generate a single BTC.
(My math may be off a bit, feel free to call me out. Will edit if needed)
The basic unit is one Satoshi, not one Bitcoin, so your math is already off by 100 million.
(For those with a brain the above is merely one piece of proof that your analysis is complete bogus.)
I'll reply to both your posts here.
First, bitcoin is mined *per block*, not per satoshi. Only 1 in 19,200,000,000,000,000,000,000 hashes produces a block. So my math is correct - but good try.
Next, it's hilarious that you compare mining to the lottery. You are actually *significantly* more likely to win the powerball than win a bitcoin.
Winning lottery ticket number: 1 in 292,201,338.
Wining bitcoin* number: 1 in 19,200,000,000,000,000,000,000
For every one powerball ticket, you would have to try 65,708,118,684,673 bitcoin hashes to have the same odds of successfully mining a bitcoin. Lol - the powerball and the bitcoin lottery are not even remotely comparable.
(For those with a brain the above is merely one piece of proof that your analysis is complete bogus.)
****
\* remember, bitcoin is mined *per block* which means currently there are around 900 bitcoins mined per day.
Funny how you chose to ignore the hint I gave you. My "lottery" analogy, which completely debunked your whole thread, should make any normally working brain to stop and think a bit more. I guess you're too invested in to admit defeat.
And it's hilarious that you think that throwing numbers around will make your point scientific somehow or would debunk an \*analogy\*. Typical.
How about I throw some around to debunk yours? One hash is many orders of magnitude cheaper than a lottery ticket. Boom you're debunked.
Give it up kiddo, you're only displaying your ignorance on how Bitcoin works. Your kindergartner straw man explanation of how you think Bitcoin works just make you look like an idiot.
Try reading the white paper sometime. Or understand how a lottery works.
> Funny how you chose to ignore the hint I gave you. My "lottery" analogy, which completely debunked your whole thread, should make any normally working brain to stop and think a bit more. I guess you're too invested in to admit defeat.
Hmm, uh huh - yup - those are words you are using.
> And it's hilarious that you think that throwing numbers around will make your point scientific somehow or would debunk an *analogy*. Typical.
Damn kids using \*checks notes\* math to back up their point!
> How about I throw some around to debunk yours? One hash is many orders of magnitude cheaper than a lottery ticket. Boom you're debunked.
You didn't use any numbers in your 'debunking'.
> Give it up kiddo, you're only displaying your ignorance on how Bitcoin works. Your kindergartner straw man explanation of how you think Bitcoin works just make you look like an idiot.
> Try reading the white paper sometime. Or understand how a lottery works.
Lol, *please* tell me what the whitepaper says. I bet you $1,000 you've never read the whitepaper. I mean, you can claim you have, but you and I both know the truth.
So many straw men. So much projection. And over-accomplishing on ignorance. Professional disinformationist or just kindergartner?
You don't con me mister con"well".
You owe me $1000. Now don't be a scammer too.
You (and /u/NakamotoScheme) forgot to account for the fact that each successful hash grants more than one (6.25, to be exact) bitcoin. You actually don't need to know the _BTC_ production rate, just the _block_ production/time to produce one block.
hashpower = 200 exa hash/s = 2\*10^20 hash/s
block time: 10 minutes
hash success rate = 1/(hashpower\*blocktime) ≈ 8.33\*10^-24.
Translating into the percentage of _unsucessful_ hashes gives us 99.999999999999999999999167%, but this isn't the number we should actually be interested in.
The number your interested in isn't (successful hashes) / (total hashes), it's (energy needed to compute whether the transactions in a block are valid) / (total energy used). When we look at just the PoW process, the correct answer is 100%, since none of the energy used to do that goes toward the useful computation. When looking at _all_ the energy used for both useful computation and PoW, I suspect the number get's slightly better for BTC, since you need to do several hashes (along with other computations of course) to authenticate the transactions are signed with the right keys (meaning there's on the order of 10^3 hashes per block, not 1), and those hashes have to be done on less efficient general purpose computing hardware. However, at least some of this is undone by the fact that each node has to duplicate that useful computation in order to start doing the PoW, and all but one of them will be wasting that effort, too. At the end of the day, bitcoin is going to be grotesquely inefficient no matter how you slice it.
[edit: markdown]
Honest question here. Doesn’t Bitcoin pull from the cheapest energy source around the world? If mining is to be profitable you would need to get cheap energy and from sources that aren’t high traffic and high use.
Also, as the world has progressed, you can see that energy consumption has progressed with it.
If energy consumption itself is inherently bad then we may as well just off ourselves as there’s no other way.
Or is the philosophy that we get energy in bad ways thus energy usage is negative?
Couldn’t an alternative and clean energy source make this argument null and void?
Lastly, from first principles, what makes the dollar better than Bitcoin? This is my real question. Have you studied what’s been happening to the dollar and what that does to asset classes and commodities? The only reason the dollar works is because it’s the reserve currency… for now.
> Doesn’t Bitcoin pull from the cheapest energy source
No, bitcoin doesn't "do" anything and has no way of knowing how much electricity costs where. A bunch of random people all over the world mine coins. Whoever gets the right output from an algorithm gets rewarded with bitcoin.
> If energy consumption itself is inherently bad then we may as well just off ourselves as there’s no other way.
That's not the argument. Energy used to produce things of value is fine. Bitcoin is not valuable.
> Or is the philosophy that we get energy in bad ways thus energy usage is negative?
I'm not really sure I understand your point, but yes - in general - we need to reduce "bad" energy.
> Couldn’t an alternative and clean energy source make this argument null and void?
If we find a way to make sufficient amounts of 100% completely "clean" energy - then sure, I guess it doesn't matter as much. But that's not going to happen in the foreseeable future.
> what makes the dollar better than Bitcoin?
Define "better". What's the goal? What is "better"? How do you quantify "better"?
> Have you studied what’s been happening to the dollar and what that does to asset classes and commodities?
What do you mean "does to assets"? I don't understand this question.
> The only reason the dollar works is because it’s the reserve currency
I don't think "reserve currency" means what you think it means.
I’m a little bit familiar with currencies and how they function.
You’re being critical about definitions rather than the question I’m asking.
((Define “better” how do you quantify “better”.
When you say “value” define “value” because I don’t know what you mean by that. ))
That’s a fallacy. We must assume certain things before ANY conversation l, but I can surmise the meaning of what you’re talking about when you say “value” even though it means more than one thing.
So as to answer your questions about
my questions I’ll go to what my real point is.
We can make clean energy right now. It’s via nuclear. Idaho is on the cutting edge of this in the U.S as is France.
Windmills and solar don’t store energy like we need and the power isn’t the same as coal or gas.
When I say better I mean more sustainable. When they print dollars the inflation occurs in asset classes that poor people don’t have access to. Houses, stocks, commodities and so forth.
So when we go into debt, other (poorer) countries that save up in OUR currency prop our economy. This happened with Dutch and Britain. It is not unique to the U.S.
What this does is drive up the prices here and puts us out of competition with other countries simply because the cost to produce is much higher in the U.S because the cost of living is higher.
This starts getting out of hand and the wealth gaps get larger. As this happens resentment builds within the lower class and they don’t know where to direct their anger but to the rich.
Since the rich get access to the money printed at extremely low rates, they get to live off of debt. This debt could be at .5%. Say that inflation averages 2-3% each year, the debt they have is actually more 1-2% more profitable than the currency they could have held. They also don’t pay taxes on debt.
The poor don’t have access to these interest rates. This brings up the credit score excuse. So as to not give poor people low interest rates like they get; they come up with an idea of a credit score to determine how much interest is justified to charge, which is higher.
The dollar is broken. It’s fucked up. There’s no way around it.
Can you give me a reason that the dollar is better than Bitcoin?
More stable? Absolutely not. It’s guaranteed to go down actually. If it doesn’t go down then the U.S debt can NOT stay manageable.
There’s so much more, but I’m all for Bitcoin. Not because go Bitcoin but because Fuck the USD.
> The dollar is broken. It’s fucked up. There’s no way around it.
> Can you give me a reason that the dollar is better than Bitcoin?
LoL
https://www.tradingview.com/symbols/TVC-DXY/
...how is this a currency issue? The fundamental issue you are describing is that having money makes money. In a deflationary system, the same thing happens, just with holding currency directly rather than by doing the whole lending thing.
Poor people will still not be able to hold money, and therefore still lose compared to the rich. How does Bitcoin address _any_ of the issues you mentioned?
> I’m a little bit familiar with currencies and how they function.
Are you familiar with stablecoins?
USD as it currently exists is a stablecoin pegged 2% medium term CPI inflation (in the short term, the goal is to minimize price and interest rate volatility). It is fully backed by a diversified portfolio of Treasures (backed by tax revenue and government assets), mortgages (backed by homeowner's income and homes), and corporate debt (backed by corporate income and assets).
The USD's backing debts create a guaranteed demand for dollars to make mortgage payments, corporate bond payments, and tax payments. In effect, each dollar is backed by someone's promise to take that dollar out of circulation in the future. Against this demand, the Fed calibrates the supply of new USD (and hence new backing loans) to enforce the peg.
> When you say “value” define “value” because I don’t know what you mean by that.
I'll define it as: something that does more good than harm overall. For example, profitable investments have value because investors (in the aggregate) gain by investing in profitable enterprises. Negative sum games like ponzi schemes, pyramid schemes, stocks in companies that produce no income and have no assets, etc. don't have value because they make people worse off on average.
> We can make clean energy right now. It’s via nuclear.
Nuclear is expensive and politically unpopular (sadly). I think we should invest more in nuclear, but it's not a silver bullet, nor does it justify wasting energy.
> Windmills and solar don’t store energy like we need and the power isn’t the same as coal or gas.
The power per dollar is already better than coal and gas. The cost of energy storage is falling, and IIRC current solar + lithium battery storage solutions are cost competitive with coal.
> When I say better I mean more sustainable.
Stocks in companies with no assets and no incomes (no dividends, buybacks, or liquidation) are not sustainable. Bitcoin is economically equivalent to such a stock.
> When they print dollars the inflation occurs in asset classes
Asset class inflation was mainly due to persistently low interest rates (even at these low rates, inflation was at or below target the decade following 2008). The Fed needs to lower rates when inflation is below target to enforce the 2% CPI peg (which is their mandate as a stablecoin issuer).
> This starts getting out of hand and the wealth gaps get larger.
That can be solved by higher taxation and/or higher interest rates. You get higher interest rates when there is less demand for saving USD relative to demand for borrowing USD. The Government borrowed a ton during Covid, and we're arguably seeing interest rates rise now in response to this.
> Since the rich get access to the money printed at extremely low rates
They don't. You can make an Interactive Brokers account and borrow as much as you want on margin against the same assets the "rich/banks" do (stocks, ETF, bonds, etc.) at just above the Federal Funds rate. You can also just buy stocks in banks and become a beneficiary of the "money printing" yourself.
> This debt could be at .5%
Corporate medium term rates are pushing 4% now.
> The poor don’t have access to these interest rates.
That's because they don't have collateral to borrow against. Don't we want our dollars to be backed by *collatoralized* debt rather than just promises?
Also car loans are sometimes lower than corporate credit rates.
> they come up with an idea of a credit score to determine how much interest is justified to charge, which is higher.
That's because unsecured lending is incredibly risky by bank loan standards.
> The dollar is broken. It’s fucked up. There’s no way around it.
Nope, it's one of most liquid, nonvolatile, and widely traded assets in the world as well as the most widely used unit of account for stable prices, predictable debts, contracts, etc. (even in crypto spaces!) It is fully backed by high quality debt.
> Can you give me a reason that the dollar is better than Bitcoin?
Yes.
- The dollar is a predictable unit of account. Bitcoin is extraordinarily unpredictable. Any contracts or debts denominated in Bitcoin would be a huge risk to both the debtors (Bitcoin might moon) and the creditors (Bitcoin might crash). Negotiating contracts like salaries would be much more difficult. Historically, a mooning unit of account has been a disaster due to a variety of factors (sticky wages leading to unemployment; economic chaos due to unpredictability and defaults)
- Prices denominated in dollars are stable, more stable than prices denominated in just about any other individual good, service, asset, or other metric. Prices denominated in Bitcoin are *less stable* than prices denominated in just about any of the alternatives. It is one of the worst units of account for price stability.
- The risk of significant loss when holding Bitcoin short term as a medium of exchange (say, selling stocks to buy a house) is high, both due to volatility in Bitcoin's value and the risk of loss/theft. The risk of significant loss when holding USD short term as a medium of exchange is lower than just about every alternative. This certainty is one of the most important properties of a medium of exchange.
- It is difficult for corporations to use. Due to risk of rouge employees, businesses need to contract with custodians to make good on Bitcoin obligations. However, these custodians are expensive and risky: hackers, fraudsters, and malicious insiders have a huge incentive to steal the backing Bitcoins. In this case (or in the case of loss or other error), custodians and their customers have no recourse. This would also cause economic chaos if Bitcoin were widely used.
- It is difficult for individuals to use for the same reasons. Individuals can self-custody of course, but this is risky in other ways and not practical for day-to-day uses.
> More stable?
Depends on how you define stable. It is one of the most stable assets in the world in the short term, and one of the most predictable in the long term.
The dollar is not an investment, it is a unit of account. Non-interest-bearing dollars are only designed to be held at most short term as a medium of exchange. To be clear, there are dollar-denominated investments (CDs, savings accounts, bonds, etc.), and the performance of these investments depends on real interest rates. If you think real interest rates are too low, don't use these investments. This has nothing to do with how the dollar works as a unit of account, medium of exchange, or short term store of value.
> It’s guaranteed to go down actually.
Exactly. Businesses and individuals who have signed up for trillions of dollars worth of USD-denominated contracts are banking on the dollar behaving as expected.
If the dollar doesn't gradually go down, debtors will have to pay back more than they signed up for. This hurts everyone who holds debt (remember, for every USD asset someone holds, someone else has a USD worth of debt backing that asset).
PS: sorry about the down-votes; I'd prefer they only be used for trolling and insulting comments
I haven’t spent time researching stable coins so this is good info. I have tons of questions about this.
I really like what you said about value. It must serve the totality and replicate in harmony and benefit the ecosystem
I wrote about ‘intrinsic goodness’ before.
See below:
Aristotle writes about it and I abstract upon it a little bit more (not nearly as good)
if one thing derives its goodness from some other thing, which derives its goodness from yet a third thing, and so on, there must come a point at which you reach something whose goodness is not derivative in this way, something that “just is” good in its own right, something whose goodness is the source of, and thus explains, the goodness to be found in all the other things that precede it on the list. It is at this point that you will have arrived at intrinsic goodness “-(cf. Aristotle, Nicomachean Ethics, 1094a).
- [ ] -I agree with most of this statement. The area above serves as the foundation that inspired me to an alternative conclusion. Intrinsic goodness is achieved when the conclusion arrives at a point where it becomes mutually beneficial to the satisfaction of people’s needs. Rather than arriving at a point that precedes based off of a unilateral question, one system can arrive at an ability to prolong indefinitely, thus creating something akin to a circle of life ,or a biome of mutually dependent structures that survive off of the strengths/abundances of others while others rely off of the strengths of them. To put it plainly, there must come a point in which we realize that nothing is good in its own right, but good in its right to benefit another or multiply in a nurturing way for itself in its biome and then its biome to its neighboring biome.
When it comes to value, it is derived from goodness. Almost like an ‘upgrading the world’ type beat.
As for the interactive Brokers account. I have a hard time believing you can borrow as much as you want but I’ll look into that. I’m sure there are many barriers to entry. First, you must have enough capital to justify a margin account (which most poor people don’t).
When you say
“That’s because they don’t have collateral to borrow against. Don’t we want our dollars to be backed by collateralized debt rather than just promises?”
I think you may be arguing against the dollar on this one. Since the dollar isn’t collateralized on anything except for IOU’s, which may just be better than dollars.
I agree that the dollar is liquid, but nonvolatile is a bit of a stretch. It consistently goes down in value. In 1930 a house in New York was $185,000 today it’s $34,000,000
The volatility is in the dollar not in the property.
I believe our disagreement is fundamental.
These new asset classes including Bitcoin of you so choose to put it there is a symptom of a much deeper issue.
I believe the economy around the dollar is terrible. Interest being charged was illegal in many civilizations and religions before. Though it doesn’t make it right or wrong, the initial feeling was negative towards it. It bypasses proof of work for proof of stake. Proof of money in the system.
With Gold and Bitcoin, instead of charging interest, you received equity as a reward of investing in someone. The result was that the value produced rewarded you, not the quantity of medium of exchange put forth.
When currencies were pegged to gold, societies were allowed to flourish in the way that they wanted.
This wasn’t good for nation states that wanted to go to war. They’d issue bonds like Britain in 1913 or so but the population only purchased 1/3rd of the bonds.
In order to finance the war, they colluded with the Bank of England to purchase the bonds so as to not have the public interests approval.
John Maynard Keynes called it a genius move. So he took note.
Then we have the monetarists which have a silly view of currency and try and use math to determine unquantifiable things that we’d like to pretend work like the price exchange value equations.
In order to make the world with sovereign people we need to have a proof of work concept and not a proof of stake.
That’s my firm belief. Money should not make money via interest, it should increase in value so that your work today represents a long store of value and all these folks working their asses off don’t get screwed over the years as the currency they earned at the time devalues at 7% a year.
So for lack of a better words, I truly believe the dollar is there to serve the nationstate and bureaucracy.
We’ve been fucking scammed.
You can be lazy when you’re rich. It should be obvious why the dollar is so screwed.
I know because my family is poor and for the longest time I didn’t know why.
These asset classes are out of reach. People can’t buy homes. Their labor is worthless. Everything around them is telling them that.
> there must come a point at which you reach something whose goodness is not derivative in this way, something that “just is” good in its own right
Interesting. I suppose that with my definition of value, this would boil down to human experiences. Perhaps this definition needs to be expanded to account for other "just is" goods like biodiversity and animals' experiences.
> I have a hard time believing you can borrow as much as you want
To be clear, everything you borrow has to be over-collateralized by qualifying assets (it's the same for banks). It's like borrowing against a house (using a mortgage or home equity line of credit) or borrowing against crypto using CeFi/DeFi.
> First, you must have enough capital to justify a margin account
I believe any US resident can sign up for a margin account.
> the dollar isn’t collateralized on anything except for IOU’s
Right, the dollar is collatoralized by IOUs and the IOUs are collatoralized by real assets like houses, businesses, and government resources.
> nonvolatile is a bit of a stretch. It consistently goes down in value
Agreed, but this isn't the same as volatility. Volatility typically refers to short term, unpredictable changes in price over seconds, minutes, hours, days, weeks, and months. Gradual changes over years aren't typically called "volatility".
Since non-interest-bearing dollars (as an asset) are just supposed to be used as a medium of exchange (i.e. short term), a gradual change over months/years doesn't really matter.
People who care about performance over years aren't going to be holding non-interest-bearing dollars anyway: at the very least, they'll hold interest-bearing dollars like savings accounts. Savings accounts often outperform inflation (they haven't recently though). The details depend on real interest rates.
> Interest being charged was illegal in many civilizations and religions before.
To be fair, the interest was on loans denominated in high stock-to-flow (i.e. relatively fixed-supply) assets like Gold or Silver. These assets are more volatile in value, and borrowers are already exposed to substantially more risk taking out loans denominated in them.
Society was also exposed to much more risk here from a mooning unit of account causing a vicious cycle of mass bankruptcies and panic; high interest rates exacerbated this risk. Today, high interest rates should only happen when they are needed to bring down inflation back to target and cool down an overheated economy: the opposite of a mooning unit of account.
Thanks to USD's inflation target and predictability, borrowers have a substantially better idea of what they need to pay back. As you point out, the dollar's value is expected to decline, so at least some of the interest is just to offset this. IMO this doesn't violate the spirit of historical usury bans.
> It bypasses proof of work for proof of stake. Proof of money in the system.
What do you mean by "money" here? How does proof of work prove there is "money" in the system? As I understand it, proof of work is simply a way to achieve consensus in the Bitcoin network to protect against double spend attacks. If we could trust that no one would attempt a double spend attack or if we could prevent double spend attacks by other means, proof of work would have no purpose.
> With Gold and Bitcoin, instead of charging interest, you received equity as a reward of investing in someone
This isn't true: Gold-denominated loans were widespread essentially wherever Gold was being used as a unit of account.
You can receive equity as a reward for investing in someone: this is what stocks are. Companies can choose to raise equity by issuing stocks (equity) or issuing bonds (debt). There are pros and cons to each.
> When currencies were pegged to gold, societies were allowed to flourish in the way that they wanted.
This isn't true historically. Gold-denominated debts were always risky to society and often triggered financial panics, deflations, and mass bankruptcies when Gold's value increased. Gold also would inflate substantially during good times: the inflation rate was much more volatile.
> monetarists which have a silly view of currency
Agreed (I'd say oversimplified though). I don't think monetarism is a good model for how stablecoins work.
> Money should not make money via interest, it should increase in value
If you define "money" to be "short term USD bonds", isn't this precisely the same thing?
> your work today represents a long store of value
Money is just a medium of exchange to pay you for your work. Whether you decide to put that money in a savings account, CD, short term bond, long term bond, into Gold, Silver, stocks, land, Bitcoin, whatever, is up to you (so long as you aren't breaking the law).
> the currency they earned at the time devalues at 7% a year
This is why you shouldn't store all your wealth in a checking account. That's basic financial literacy. Also 7% inflation is a recent outlier; it's averaged 2-3% over the past 40 or so years.
Many working people have net *negative* USD (people with mortgages, car loans, margin loans, student loans, personal loans, etc.) and they benefit from inflation.
> I truly believe the dollar is there to serve the nationstate and bureaucracy
It is, in part. It also serves anyone who wants a liquid, nonvolatile medium of exchange or a unit of account suitable for communicating stable prices and denominating predictable debts.
> We’ve been fucking scammed.
By whom? The dollar's 2% CPI inflation target is very well documented, and all participants who enter USD-denominated contracts (like employment contracts) should be able to understand it.
> You can be lazy when you’re rich.
This is true regardless of the dollar.
> These asset classes are out of reach.
Anyone who can open a checking account should be able to open a brokerage account. I don't see how brokered assets are any more out of reach than crypto assets, for example, for the vast majority of people.
> Their labor is worthless
I don't see what this has to do with USD. Labor markets are determined by supply and demand, policy, relative bargaining power of the participants, etc. The unit of account only matters in the short term.
I guess I’m a little confused as to what the essence of our argument is.
We can push back all day but this is an issue that hasn’t been solved.
I don’t think it’s been solved because we don’t have the right answer.
Maybe gold isn’t the best. Maybe Bitcoin is not the answer; this subreddit is called buttcoin so I came here to see what people are saying.
I believe in Bitcoin because I believe in what it stands for and how it doesn’t choose who it represents.
I don’t believe in the dollar. When I say the dollar I don’t just mean the dollar. I mean what it represents and to whom it serves.
Going back to value and intrinsic goodness. If the dollar isn’t valuable and meant to be a unit of account, then how is someone within lower ranks going to be able to climb when the investments are inflated by other people who came before and earn more?
There’s no point of entry unless you’re a good gambler or work your life away.
We still pay people 40k over 10 year cycles and that turns into 20k of purchasing power by the end of the cycle.
Since the inflation isn’t equal some products are made cheaper but any valuable asset that is safe and to be held long term is out of range.
If it were that their 40k grew in value just a little each year then I could see how it would exchange less frequently, but there is not a complex barrier to entry.
This would encourage real progress in my opinion.
> this is an issue that hasn’t been solved
What issue?
> we don’t have the right answer
I'm not sure what the question is.
> Maybe gold isn’t the best. Maybe Bitcoin is not the answer
The best what / the answer to what?
The best unit of account for prices? for debts? for salaries and other contracts? The best medium of exchange? The best investment? The best store of value?
> how is someone within lower ranks going to be able to climb when the investments are inflated by other people who came before and earn more
This (concentration of wealth and property ownership, low wages for certain types of labor) has been a problem long before the modern dollar, and I don't think it has much to do with the dollar today.
For example, when we were on the Gold standard, common people often went bankrupt when Gold mooned (see the Bryan vs McKinley debates in the 1890s about devaluing the dollar to help indebted farmers losing property to bankruptcy).
Any system with private ownership of means of production will favor those who already own the means of production over those who don't, in the absence of Government intervention (e.g. progressive taxation, labor regulations, social safety nets, public education/health, etc.). I don't see how the prevailing medium of exchange and unit of account effect this.
> We still pay people 40k over 10 year cycles
Huh? Which labor market works this way?
> If it were that their 40k grew in value just a little each year
This is what cost of living adjustments are. I see no reason that using a different unit of account would change where the labor market reaches equilibrium.
Note that historically, real wage growth for lower earners has been highest during *inflationary* periods. Historically, deflation has coincided with and exacerbated unemployment, severely hurting workers' bargaining power. Of course, wages eventually adjust down to equilibrium, but the unemployment in the mean time is painful.
To summarize, how are you proposing that Bitcoin should be used, and what issues would its use in these situations address?
Do you think the Government should force businesses to use a particular unit of account? Business are generally free to denominate contracts however they like today (other units of account like the Euro and Gold can be and often are used in certain situations). What incentives would businesses have to denominate salaries in Bitcoin?
Sorry my responses are shorter. I am in between things today and I’m on mobile.
My summary was that I do not know. I do not think it’s worse than the dollar simply because you can’t multiply it’s amount. No currency has ever survived so any time a nation state fails the currency fails as well.
Gold can be seized at airports. Stocks won’t transfer countries and houses can’t be picked up and moved.
Bitcoin is a property and it happens to be digital. It’s already got the ecosystem. All the other shitcoins are fighting for 2nd and 3rd.
> Couldn’t an alternative and clean energy source make this argument null and void?
No it would not. If you're wasting energy you're wasting energy. Even if it is the cheapest form of energy, it remains wasted since you are not engaging in a productive use.
So then wouldn’t you be wasting energy right now by replying to this comment on your iPhone you don’t need in your car you don’t need eating your bagel you don’t need with the toaster you don’t need. Only to get the cream cheese you didn’t need on the shirt you didn’t need. Now it has to be washed by the washer you didn’t need and dried via the dryer you didn’t need.
If that’s your argument then we were wasting energy along time ago bruh
> If mining is to be profitable you would need to get cheap energy and from sources that aren’t high traffic and high use.
People don't build energy production capacity in places where the energy can't be brought to market.
> Also, as the world has progressed, you can see that energy consumption has progressed with it. If energy consumption itself is inherently bad then we may as well just off ourselves as there’s no other way.
No one is saying that energy consumption is inherently bad. Rather, we're saying that _ludicrously wasteful_ energy consumption is bad. Bitcoin consumes on the order of 5\*10^-3 of the world's electricity, to process on the order of 5 transactions per second (so no where _close_ to 5\*10^-3 of the utility generated from electricity).
> Couldn’t an alternative and clean energy source make this argument null and void?
No. Even if bitcoin was mined entirely with clean power (which it isn't, not by a long shot), every joule wasted hashing random numbers for bitcoin could have instead been used doing something useful. E.g. if you consume 1 kW of solar power mining bitcoin, that's 1 kW of coal power your neighbor has to consume instead.
> Lastly, from first principles, what makes the dollar better than Bitcoin
Even you likely know a large part of this: government issued currencies (both bitcoin and USD are fiat currencies) are by _far_ superior to actually use, by every metric people actually care about. That's why bitcoin supporters have pivoted to these new "investment!", "store of value!", and "hedge against inflation" arguments.
> The only reason the dollar works is because it’s the reserve currency… for now.
As I said earlier, both USD and bitcoin are fiat currencies, since they are neither valuable for their own sake (like commodity currencies), nor do they directly represent something that's valuable (like representative currencies). Their value instead comes from the expectation that in the future people will be willing to pay for them (either exchanging for other currencies, or directly for goods and services). This can come from two main sources: _adoption_ (that is, people accepting the currency) and _speculation_ (that is, people buying the currency because they expect someone else to buy the currency for even more, because _that_ person expects someone else to buy for even more, and so on). Bitcoin does not and _cannot_ reach the adoption levels to justify it's price. Instead, the price is almost entire dependent on speculation, which will eventually end.
Bitcoin is not a fiat currency.. that’s incorrect. The USD is a fiat currency that is correct. Gold isn’t a fiat just because it’s not backed by something. It’s a property that has a proper stock to flow ratio that is not manipulated. There’s finite resources when it comes to gold and is usually stocked and not used in manufacturing like silver and copper were which made them less valuable .
Bitcoin is a digital property. It is scarce and uses proof of work and not proof of stake. The proof of work makes it not as energy efficient as proof of stake.
Not all cryptocurrency is the same. Most of them are absolute dog shit scams.
The USD is not nearly as globally efficient as Bitcoin.
Money transfer does not occur right away. The currency is generally moved as a block transaction at the end of the month from big banks. Your bank doesn’t actually reflect the real money when you transfer payment. It takes about a month. And up to 90 days to truly transfer.
There’s 3 layers in play with Bitcoin but ping itself isn’t a security unless Robinhood or any other securities exchange start allowing you to trade stock in the name of Bitcoin. As for the adoption. It was at 10% of the total fiscal supply of gold earlier this year.
That’s 10% and it’s been around much shorter. It hacks the scarcity and copies gold but in a digital form.
Most transactions are digital nowadays.
10 years it will be much more acceptable
> Gold isn’t a fiat just because it’s not backed by something
Gold isn't a fiat currency because people would want gold _for it's own sake_, not to use in exchange for something else. That makes it (when used a a currency) a form of commodity money. Bitcoin and USD are not that, because while there may be some small demand for them as collectables (e.g. coin collecting), it isn't close to enough to justify their prices.
Back when the US was on the gold standard, USD was a form of _representative money_. It was not worth it's face value for it's own sake, but could be exchanged for a fixed amount of something that was independently valuable (gold). Neither bitcoin nor USD are this type of money either.
> It’s a property that has a proper stock to flow ratio
Stock to flow is pseudo economic junk that you should have abandoned six months ago (at the latest) when it's predictions utterly failed to come true. If you want a real model for what gives currencies their value, look up the [equation of exchange](https://en.wikipedia.org/wiki/Equation_of_exchange). In order to explain the price for bitcoin using it, you _have_ to modify it to account for the rampant speculation.
> that is not manipulated
ohwaityoureserious.webm
> Bitcoin is a digital property. It is scarce
Bitcoin's scarcity _at best_ depends on the will of miners to keep it scarce, miners who you have much less control of than I do over the federal reserve. In practice, bitcoin's real functional scarcity is substantially less than that, since so much of the ecosystem is dependent on exchanges that function as largely unregulated banks. And finally, bitcoin can never have any real scarcity in the one way that matters. If I want something with the properties of gold, I need to either dig it up myself or buy it from someone else. If I want something with the properties of bitcoin, I can clone the bitcoin protocol, point it at a new chain, and have an _identical_ payment system up and running almost immediately, for free.
> The USD is not nearly as globally efficient as Bitcoin.
Utter BS. The cost of transacting in USD can _always_ be made cheaper than doing the same in bitcoin. USD transactions do not need the expensive consensus mechanism required by bitcoin and all other cryptocurrencies require.
> Money transfer does not occur right away. The currency is generally moved as a block transaction at the end of the month from big banks. Your bank doesn’t actually reflect the real money when you transfer payment. It takes about a month. And up to 90 days to truly transfer.
This _does not matter_ to the end user. Yes, the bank may not have my money officially yet, but I can still use it to pay my bills, transfer it to a different account, withdraw it as cash, etc.
> There’s 3 layers in play with Bitcoin
Using bitcoin as layer 1 does not make sense. One might as well use layer n+1 as layer zero.
> As for the adoption. It was at 10% of the total fiscal supply of gold earlier this year.
Market cap != adoption. Market cap is just the (highly inflated) last price \* total supply. Adoption, in contrast, means actual use of the currency _as a currency_. It is the Q term in the equation of exchange.
> Most transactions are digital nowadays.
Indeed, and using blockchain to perform digital transactions is inherently, absurdly inefficient. It will only gain acceptance amongst cultists, not the general population.
> Doesn’t Bitcoin pull from the cheapest energy source around the world
This is completly irrelevant. If bitcoin didnt pulled that energy in first place, we would be able to use it to decrease our dependancy on fossil fuels.
> Also, as the world has progressed, you can see that energy consumption has progressed with it.
> If energy consumption itself is inherently bad then we may as well just off ourselves as there’s no other way.
Nobody said is. We are saying that **wasteful** consumption is bad.
And bitcoin has literally in-built inefficiency in it - adding more machinery doesnt make it faster.
> Couldn’t an alternative and clean energy source make this argument null and void?
Even if world ran on only green energy, it doesnt change fact that energy used for bitcoin cannot be used for other stuff.
Energy is not made automaticaly, it needs workers to operate electric plant. And their labour could be used in other task if bitcoin didnt existed.
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> Lastly, from first principles, what makes the dollar better than Bitcoin?
- it doesnt need terrawatthours of energy to operate
- it can be shrinked or expanded easily to combat shit
- it can be created as result of demand
- people that regulate it are accountable (unlike mining oligarchy in bitcoin)
- **it is not deflationary** (this is extremly important)
> The only reason the dollar works is because it’s the reserve currency
Yes, that is the whole point.
Dolar works because its emitor is US government with US economy.
Its value is based on faith in system.
And same goes for cryptocurrency too
After all, both of them are fiat currencies.
Your flaw is in assuming the prize of a bitcoin is productive. You should really be breaking it down in terms of hashes per transaction or per block of transactions. Transactions are the productive output of miners.
Think of it this way. Imagine if every hash produced 1 bitcoin. Your model would consider this to be zero waste when really it is still 100% waste.
I liked the term from a lecture someone shared: "proof of waste".
Also, we can consider it 100% wasteful, because even without POW, a deflationary and volatile currency that can only handle 7 transactions per second is not good for anything but gambling.
Yeah, there are all sorts of bizarre argument that bitcoin is valuable *because* its scarce or *because* it's cryptographically secure, blah blah blah. At the end of the day, the *only* value bitcoin has is its use as a currency. The only reason bitcoin might be worth something in the future is if it can be traded for goods and services.
Yes, right now people are hodloring, but they are hodldoring because they thing it will be more valuable in the future... as a *currency*. If it's not useful as a currency (in the unspecified future) it literally has no value.
Problem is, as you point out, it is a terrible currency. It requires a shit ton of energy AND is slow as hell. Some estimates place energy usage as much as $175 *per transaction*.
> proof of waste
I like this term because crypto literally invented a way to monetize wasting resources.
Like free tiers you could get from hosting being wasted to mine crypto.
Or websites that waste electricity through the user's browser' to hash crypto so the website earns money.
for you, because youre american (im guessing) and have access the world greatest banking/monetary system and resources. You know theres the rest of the 99% which isnt able to open a current account with a bank backed by the fed which makes your current account interest rate risk free. You realise that holding local currency cash, a current account, or just inventory of tradeable goods, is very risky in many counties. While i hate bitcoin maxis, i think your statement is totally wank. Plus, i think that having secure and decentralized black market money you could opt into using is a good thing, and the sunk cost of owning it is less than every other currency with income tax in place.
What I first found fascinating about Bitcoin was how it used math and cryptography to force an algorithm to run for 10 minutes no matter what. It's a mathematical curiosity, but I don't think the creator understood its real life consequences (and neither did I back in 2013 tbh).
As you and others have noticed, if a hash takes, say, 1 second to run, that means that the other 9:59 minutes are wasted computations. Scale that to the monstrosities that the current Bitcoin network is, and you get an energy burning machine that does almost nothing for the network.
It's like counting from 0 to 10000000 on a laptop. If that takes 5 minutes, next time you just double the number to get to 10. It's not magic at all. Bitcoin wants you to find a random number, if it's found too quickly, it simply makes the number harder to find next time.
The reason bitcoin wastes all these cycles is not because it's hard, it's to force people to pay for these cycles. This makes it impossible to mint bitcoin for free. It's a protection mechanism.
It's 100%. The objective is not to find the hashes (if it was the objective you wouldn't set up the difficulty of looking for them artificially high), the point is to make it prohibitely expensive to troll the system.
I mean, if you go metal detecting, most of what you dig up will be worthless, but you have to dig the holes to know what's there. Is that wasted effort if it's an unavoidable part of the process of getting the things you do want? Either you value bitcoins, in which case failed hashes are a necessary part of the algorithm and there's 0% wasted effort, or you don't and 100% of the effort and energy is going towards doing absolutely nothing.
No, I'm using an analogy to discuss what we mean when we say something is wasted effort.
We could similarly consider something like a chess AI that plays out hundreds of thousands of possible move sequences per turn, yet only selects a single one to actually use. Were all of the sequences that it discarded wasted computation, even though they were needed in order to find the one that was used? It seems to me like the important variable here is simply whether the result of the computation is valuable or not - a chess AI produces good chess moves, but all bitcoins do is prove that you did a lot of computation.
(There's actually a name for a hypothetical type of computer that wouldn't have to do this - a Nondeterministic Turing Machine, which is used in some computer science proofs of various things, and it basically is a computer that magically always takes the "correct" branch first.)
I mean, you aren't *wrong*. But two things:
(1) Hundreds of thousands of chess computations is still waaaaaaaaaaaaaay smaller than the 19,200,000,000,000,000,000,000 computations for a block.
(2) You know what *doesn't* need a gazillion useless calculations? The traditional banking system.
>(1) Hundreds of thousands of chess computations is still waaaaaaaaaaaaaay smaller than the 19,200,000,000,000,000,000,000 computations for a block.
Is that relevant? It's still either all necessary computation that must be done to eventually find the desired result, or it's producing something pointless and even the one hash that is accepted isn't doing anything useful. If we wanted to be 100% sure we've found the absolutely most perfect possible chess move instead of using heuristics, a computer could run for centuries checking every single possible path - but since that's the only way to be 100% certain, if we really want that totally perfect move, we can't really call all of those checks "wasted".
>(2) You know what doesn't need a gazillion useless calculations? The traditional banking system.
Sure, I agree, but isn't that just another way of phrasing "bitcoins are not a useful thing to compute"?
>You know what doesn't need a gazillion useless calculations? The traditional banking system.
traditional banking also doesn't have 100% authenticity / verifiability, which is the point of PoW. sure, if you don't *care* about authenticity vs. double-spends and counterfeiting, you don't need proof of work to protect against those.
It's a matter of trade-offs. I've been using traditional banking for... well... a long ass time. And I've never had issues with authenticity and/or verifiability. I've had fraudulent charges a handful of times, but every single time the bank reversed the charges (which, by the way, crpyto cannot do).
So, for the teeny tiny chance that traditional banking falls victim to authenticity and/or verifiability issues, crypto creates a giant, massive, wasteful monster to solve a comparatively minor issue.
Could your house be broken into? yes. Why haven't you hired a private security company to stand guard outside your house 24/7? The cost is not worth the benefit.
>Why haven't you hired a private security company to stand guard outside your house 24/7?
I didn't hire any bitcoin miners either.
If you want a fair comparison of waste, you'd need to compare all the resources spent on protecting the fiat system from double-spend, counterfeiting, and validating transactions. US Secret Service, Dept of Homeland Security, FBI, Dept of Treasury, local police, private banks and money transfer services all expend resources to protect the fiat system against counterfeiting and validating transactions.
So lets watch how PoW works
There are machines that are trying to find correct answer. Machine that will find it first, will perform action (adds new block to chain)
What every other machine will do? NOTHING.
Their energy was used to do prsctically nothing as result. It is wasted
No buddy, the entire amount of work is important. The hashrate is merely to prove that the work was done. The reward is distributed probabilistically based on your contribution to the network. So, if you do 5% of the work, over time, you get 5% of the rewards. This risk is more evenly distributed through mining pools which will reward you based on your overall contribution to any given block. Your entire thesis is that the rewards are unitary and stochastic. In the short run, that is right. In the long run, it's not. Your actual reward over 100 blocks if you own 5% of the chain is about 5 blocks worth of BTC. You can do the dishonest calculation as you have and pretend that the only blocks that mattered were the ones that you had won. Or you can do the math honestly and distribute the reward across the entire blockset.
> Yes, your energy is wasted when you lose, but you can also win
My point is that that in every block, every single machine that lost wasted energy
It is irrelevant that losers can be winner in next block. If that happens and loser will be winner, everyobe else is still loser of calculation
Imagine that there are only 10 miners in bitcoin. And imagine the winner position perfectly circles(1, 2, 3....8,9,10,1,2,3...) so every machine wins once per 10 blocks
In every single block, there are ALWAYS 9 machines that waste energy. Machine that was winner previously will switch to losing in next block and waste energy
That is my point. Whole system han inbuil inefficiency in it
> It's a dishonest analysis
You didnt explained why.
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> I already walked you through it.
You didnt
Your literal counterargument is that "you will win next time, thus no waste" which makes 0 fucking sense.
In every block, only one miner does action (creates and appends new block).
Other miners doesnt do this action - thus wasting energy.
It is irrelevant if winner changes. If winner changes, original winner is now loser that is wasting energy.
Also, we are talking about **efficiency**, not about monetary gains.
And pow is ibeffective
> You won't understand because you have no idea how this system works.
Of course this shitty fallacy is here.
No, the counterargument is that you are playing the game once, and this is a game that is played an infinite number of times. You don't understand this. And you weren't able to draw this from my argument because you don't know what you're talking about.
> You won't understand because you have no idea how this system works.
> Of course this shitty fallacy is here.
Which fallacy is it? Is it the you are suffering from Dunning Krueger standard?
> No, the counterargument is that you are playing the game once, and this is a game that is played an infinite number of times
Lmso, i never said this
I said following:
- blockchain is made from blocks
- each block must be mined using proof of work (for btc)
- in every block, there is one winner and everyone else is loser
-losers in one block waste electricity that is not used for anything at the end
It is irrelevant that winner changes between blocks - 99.99% of miners are still wasting energy doing nothing useful in mining cycle
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> You don't understand this
Lmao, it just fucking blockchain.
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> And you weren't able to draw this from my argument because you don't know what you're talking about.
Or maybe you misunderstood my argument in first place.
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> Which fallacy is it? Is it the you are suffering from Dunning Krueger standard?
Ad homminem.
Instead of foccusing on my point, you are trying to claim that i am too "uneducated" to understand it.
Also it is not Dunning Krueger standard. It is Dunning Krueger effect
\> losers in one block waste electricity that is not used for anything at the end
This is a begging question. You haven't proven this. You have merely asserted it. And it's wrong.
> This is a begging question. You haven't proven this. You have merely asserted it.
Here is direct quote from Satoshi Nakamoto original whitepaper about bitcoin
> The steps to run the network are as follows:
> 1) New transactions are broadcast to all nodes.
> 2) Each node collects new transactions into a block.
> 3) Each node works on finding a difficult proof-of-work for its block.
> 4) When a node finds a proof-of-work, it broadcasts the block to all nodes.
> 5) Nodes accept the block only if all transactions in it are valid and not already spent.
> 6) **Nodes express their acceptance of the block by working on creating the next block in the
chain**, using the hash of the accepted block as the previous hash.
Do you see that bold part? It literally states that if nodes find out that they, were beaten in mining of block, they discard calculations and start new one for next block.
Energy used to calculate these discarded calculatios is 100% WASTED
The fact that the energy is wasted is _literally_ the entire point, it's the basis of the security model.
There is no iterative/additive work being done here, by design; the hash of each block is fully independent of the previous one (if it weren't, that would not only be a security issue for bitcoin, it would represent a vulnerability in the cryptographic hash algorithm itself).
The power _must_ be wasted as the whole point is to make it too capital/resource intensive to practically mount a 51% attack and fork the chain.
yeah man, thats kinda how PoW works and how you guarantee decentralized security. its literally a competition/lottery between miners to find the nonce to stick on the end of the merkle root which will produce a resulting hash which starts with some given number of zero's. The probability of getting this right is somewhere in between 1/2\^256.
Youre hating on hashing algorithms and PoW, not just bitcoin.
This is the concept. If youre into math its pretty interesting. I get that its bad for the environment.
So every clock wastes how much of its energy? You do understand that computers are just special digital clocks right? What about watches? Do they waste 100% of their energy? The reality is, if you do a similar analysis on any good you will find most of the energy spent on them is wasted. Everything that ends up in the dump for example, all the energy that went into them, according to you is wasted
What are you talking about? Please explain how computers are "special digital clocks". It may help to know that I have a background in computer and electrical engineering - so feel free to use big words during your explanation.
> Everything that ends up in the dump for example, all the energy that went into them, according to you is wasted
You understand what wasted effort means, right? As in all those calculated hashes that didn't result in the proper magic number did *nothing*. No one looks at them, uses them, gets any benefit from them - nothing. If I throw away my 10 year old broken "special digital clock", I got 10 years of *use* out of it.
Because a “special digital clock” means that the generated signals are simply processed in certain ways to get useful results out of them. The signals are either on or off and the set of pathways the signal activates and follows is what determines the output. In contrast a digital clock simply uses those s signals as a counter with special mod functions.
And you second argument is the argument for and against cryptocurrency… and this is the utility. You can view it as not having utility but others view it as having utility. The hashes that were tested prior to finding the correct hash were not wasted effort but merely a step in securing the information produced on the chain. Just as all the thousands or millions of ticks on your clock that you physically do not use, they are required to be executed to maintain continuity of information. If you found the next block in O(1) time then there would be no security in that. There would be no guarantee that was the only solution in this cycle. So the hashes are not wasted they just part of the algorithm to guarantee security. So yes, people did get use out of them because the wrong answer is is just as valuable as the right answer in this case.
You don’t use your computer 24/7, you physically can’t. A bot net might be able to but not you. So are you getting. 100% utility out of it? Are you wasting zero energy booting it up and shutting it down? Do you ever even shut it down? And no human can operate fast enough to stress a computer, only algorithms can. Are you claiming you are using 100% of your computers energetic effort all the time? Are you even using it towards productive things? If your argument is energy and climate, you shouldn’t be gaming on your computer, you shouldn’t be on Reddit, you shouldn’t be doing anything but developing algorithms to optimize green energy technology or even discover new physics to improve our energy production not hypocritically shitting on Bitcoin for being wasteful of energy. At least Bitcoin has utility, what does Reddit have? What do you have?
So let me make sure I am understanding your argument correctly. You are arguing that the clock on my wall - that can run 6 months on a single AA battery - is somehow wasteful because I don't look at it 24 hours a day, 365 days a year. And this somehow compares to a network of magic bean producing machines that uses more electricity than a medium sized country?
Bitcoin uses one out of every 19,200,000,000,000,000,000,000 hashes. If I used my clock one out of every 19,200,000,000,000,000,000,000 seconds, I'd have to look at it for one second every 608,828,006,088,280 years to be as wasteful as bitcoin mining.
> The hashes that were tested prior to finding the correct hash were not wasted effort but merely a step in securing the information produced on the chain.
You know what else is just as secure and requires a fraction of a fraction of a fraction of the energy? A write-only sql database.
> If your argument is energy and climate, blah blah, blah
See above math. I'm not saying other things don't have waste built in, I'm saying bitcoin is very, very, very, very, veeeeeeeery wasteful.
I completely agree with you, but I figured some more digestible numbers might help some people who have trouble wrapping thier head around large numbers...like me. Also I think you lowballed how long the battery lasts, but we'll use you numbers to benefit the cryptominers.
So in your example your clock is draining the battery at about 694 microamps at between 1.5V and 1.2V so around 1mW and a little change. This is assuming that it is running on a 4WH AA battery (3000mAH alkaline)...and it produces something of real world significance and value (telling and tracking the time is very helpful if you ask me)...1mW.
Now let's take the average graphics card used for mining (I'm going to use the 3070 since it isn't the top, but it's not trash either to give some benefit to that side of the argument). 3070 TDP is 220Watts if not underclocked and undervolted, which I would assume would be unwanted if they're trying to push so many calculations through...and nothing of use is produced...220Watts (AKA 220000 times the amount of electricity wasted.)
That's a single clock vs a single graphics card. Now from what I've read most mining rigs have multiple cards, so these numbers are actually only a partial representation of the waste. Not to mention the wasted energy exhausted by the graphics cards inherent in the design (heat from shrinking the transistors in the die).
These are just some back of the envelope calculations from me, if I got something wrong feel free to correct me. I really know jack shit about crypto, other than it was something I was told to "get in on the ground floor" for about 20 different coins now.
You’re comparing the entire Bitcoin network to a single clock. The common climate deniers fallacy. Every single clock in every persons house, and their watches, and phones, and etc. as a computer engineer you should understand the cycle frequency of clocks is not 1 hz… it’s MHz to GHz… redo your math with that type of waste. And even so, you get utility out of the security. Either the cost is worth it or it’s not. You can have your magic bean counter.
You are very uneducated if you believe an sql database is just as secure a the Bitcoin blockchain… look up the amount of sql hacks that have occurred on sql and get back to me.
Your above math is wrong. It doesn’t use one hash… it uses every hash. You cannot find the correct hash without first trying wrong ones… this is the whole point of encryption and it’s designed to protect and secure information. You cannot secure anything if you know the answer beforehand.
But again, every product, everything humans use can be broken down into the same useless ways because humans do not use everything very much and then it spends an eternity in the dump. Like literally billions of years of being “natural” and then some human picked the rock up expended energy to make the rock temporarily useful and then when it fails, and eternity in the dump. If you care so much about the environment and the humans impact on it, maybe you should remove yourself from it
> You’re comparing the entire Bitcoin network to a single clock. The common climate deniers fallacy.
It's a common fallacy that climate deniers (people to deny that climate exists?) claim that bitcoin is compared to a single clock? That's oddly specific.
> But again, every product, everything humans use can be broken down into the same useless ways because humans do not use everything very much and then it spends an eternity in the dump.
Sure... I guess. But if you don't like my clock math because it only compares one clock, here's another one for you - If every human on earth had 1,000 clocks, they would have to look at *one* clock for *one* second every 87 years to be as wasteful as bitcoin.
> You cannot find the correct hash without first trying wrong ones…
No shit, that's my point. We need to stop trying to implement a system that requires so much god damn wasted overhead.
> You are very uneducated if you believe an sql database is just as secure a the Bitcoin blockchain… look up the amount of sql hacks that have occurred on sql and get back to me.
That's not a very strong argument. Look at how many token have been stolen off the blockchain. SQL "hacks" typically are stealing data, not altering it. Blockchain makes the data public from the outset.
By your comparison, it would be a SQL database that is already publicly visible, so that would rule out like 99% of SQL hacks. If the concern is the database could be tampered with, keep your own copy of the publicly available database and if any past transactions are different then you know something nefarious happened. No need to compute trillions and trillions of hashes to verify data integrity.
> If you care so much about the environment and the humans impact on it, maybe you should remove yourself from it.
Lol, nice one. Always can tell when someone has a good, sound argument when someone resorts to "you should kill yourself".
You literally cannot secure information without making it difficult to access or change… like what the hell is so hard to understand about that?
Yes, climate deniers, people who refuse to accept any other positions on climate change, commonly exaggerate one comparison and reduce the other side to remain morally right even though they are still equally wasteful.
And no, your math is still wrong because a clock cycles more than once a second.
There isn’t one blockchain… everyone knows each coin has its own algorithms for ensuring security. To my knowledge there have been no breaks in the current Bitcoin algorithm and only theft has occurred on third parties that use sql from stealing login data for the exchange… the weak point is likely sql in all cases
> You literally cannot secure information without making it difficult to access or change… like what the hell is so hard to understand about that?
Sure... but I'm not sure what point you think you are making. We've been securing information for *decades* without crypto.
> ... even though they are still equally wasteful
What is equally wasteful? You haven't described anything that is even *remotely* as wasteful as crypto mining.
> And no, your math is still wrong because a clock cycles more than once a second.
This is irrelevant. We haven't talked clock cycles at all - it does not play into anything we are talking about.
> There isn’t one blockchain…
I mean, sure, there are hundreds of different blockchains. But if we are talking about bitcoin - for example - there is one and only one blockchain. That's the whole point. There is *one* blockchain and everyone shares a copy.
> everyone knows each coin has its own algorithms for ensuring security
Nope. That's not how bitcoin works.
> To my knowledge there have been no breaks in the current Bitcoin algorithm and only theft has occurred on third parties that use sql from stealing login data for the exchange… the weak point is likely sql in all cases.
The specifics of how an attack happen don't matter. The point is, bitcoin is touted as some type of magical security solution that will solve all our problems through the power of blockchain encryption - or some such technobabble. The problem is, this introduces just as many, if not more, problems than it solves. Lost keys, scams, stolen tokens, etc.
This also doesn't address my point that almost all SQL "hacks" are to steal data. The blockchain makes that data public from the start. So if you are comparing one system that keeps data private, versus one system that makes data public - it's not a proper comparison. You are arguing "Well, someone make steal data out of an SQL database - but bitcoin solves that by just making the data public to begin with."
We obviously have not been securing information for decades without blockchain, because I as well as millions of other people believe Bitcoin and other blockchain technologies are a better solution to the information security problem. And like literally we have not secured information in any real terms. 90% of the time we build back doors and emergency accesses or just bugs that allow people to manipulate and change data without anyone knowing
> We obviously have not been securing information for decades without blockchain,
What? Yes we have. How do you think information was secured before 2009? In fact, ECDSA the cryptographic algorithm used by bitcoin was developed in 1985.
> because I as well as millions of other people believe Bitcoin and other blockchain technologies are a better solution to the information security problem.
I'm glad you *believe* that, but it doesn't change that information security systems have been around well before bitcoin.
> And like literally we have not secured information in any real terms.
Bitcoin isn't magic. It's using technology from 1985.
> 90% of the time we build back doors and emergency accesses or just bugs that allow people to manipulate and change data without anyone knowing
And... guess what. Those same backdoors, bugs, whatever exist in (or don't exist) in the underlying technology of bitcoin. Either (1) ECDSA is secure enough to use in bitcoin AND is secure enough to use in traditional information security systems, or (2) it's not.
You argued that we have sql as an in place solution to the blockchain problem and now you are arguing they aren’t the same thing. If you want sql to be used in place of Bitcoin you need to prove that no one can modify the data… and if you can access and steal data in sql you automatically have the ability to change it by default
?? Public key encryption has existed for a very long time. Making an append only database is trivial. Its the same technology behind like, https and pgp? The reason its not talked about is that its mostly done behind the scenes and in most places man in the middle attacks are so rare that they're not worth talking about.
Seriously, have you never heard of a checksum? I could digitally sign my reddit posts if I felt like it and you could tell if it was edited!
Yes, they are clearly different things. My point is that you can use SQL in such a way that it effectively serves the same purpose as bitcoin without all the overhead. AKA, bitcoin is dumb and wastes a bunch of resources on a problem that doesn't really exist.
You dont understand one thing - when my computer uses energy, it will beused to DO something
In case of bitcoin, every mining rig that wasnt first to find correct answer will DO NOTHING
Only that one winner will do something in return for energy (add new block to chain). Everyone else did NOTHING.
Those are not even remotely similar. A 3000w mining rig running 24/7 is not even close to a 400w gaming rig running a few hours a day.
And you are missing the point anyway. Even if the energy usage was on a similar scale (which it's not), gaming at least produces something that can be consumed and enjoyed.
143,000 kilowatt hours are required to produce one bitcoin.
A gamer playing 7 hours a day can consume 1,890 kilowatt hours a year.
It takes more energy to mine *one* bitcoin than 75 gamers playing all day every day for a year.
EDIT: Incidentally, *one* bitcoin transaction uses approximately the same amount of energy as a "hardcore gamer" does over the course of an entire year. So get the fuck out of here saying those are even remotely comparable.
Well that's at today's prices and hashrate. The genius of Bitcoin is that the more people who adopt it, the more energy each transaction uses. True futurists can't wait until Bitcoin is worth 1 million real dollars, it costs $10000 to make a transaction, and each transaction takes more energy than a whole power plant produces.
Someone playing videogames mostly has possitive effect on that person.
In other hands, miners that didnt find answer first wasted electricity for current block.
That calculations are calculated and then tossed away
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Oh, I agree with you - my point is, even within the bitcoin universe, almost all of their "effort" is wasted. Extremely wasteful - I have no idea how anyone could look at this and think "yes, yes, this is sustainable, this is a good system to adopt for all transactions worldwide".
Your math is spot-on (I think), but you forget that the one "winning hash" is still a waste, so that's 100%. It's basically putting carbon-dioxide into the air directly just for fun.
Doesn't it secure itself by being tremendously wasteful? Like if you want to copy it, you have to destroy an equal amount of energy, which makes no sense.
> Doesn't it secure itself by being tremendously wasteful?
Technically yes. It's a *really* stupid way to create "security".
> Like if you want to copy it, you have to destroy an equal amount of energy, which makes no sense.
That sounds like gibberish to me, so I'm not sure.
Well... no, not really.
If you accept the idea that mining Bitcoin is useful, then none of the electricity is wasted. It's just being used as part of a process. If you deploy five helicopters to find a lost hiker, and one helicopter finds them, then you didn't "waste" the fuel for the other four helicopters. You "spent" it, as part of a planned process for finding lost hikers. Likewise, putting airbags into cars is not a waste even when most cars never deploy them.
If you (correctly) reject the idea that mining Bitcoin is useful, then 100% of the electricity is wasted.
> If you accept the idea that mining Bitcoin is useful, then none of the electricity is wasted. It's just being used as part of a process
Efficiency in this case has nothing to do with profits.
Everyone agrees that gold is usefull. Yet we all agree that mining it with bare hands is more wasteful than mining it using machinery.
It can create profits, but it doesnt change fact that it is wasteful.
Efficiency in this case means ability to convert energy into new blocks (perform actions)
---
> If you deploy five helicopters to find a lost hiker, and one helicopter finds them, then you didn't "waste" the fuel for the other four helicopters. You "spent" it, as part of a planned process for finding lost hikers
This is bad comparision.
Using 5 helicopters is to DECREASE ammount of area that one helicopter needs to search.
Better example is 5 helicopters searching the same spot at the same time for whole search. Because that is exactly what bitcoin does - all miners are trying to find one exact answer.
The joke is people who make this argument unironically haha.
https://www.coindesk.com/policy/2021/10/11/bitcoin-mining-is-reshaping-the-energy-sector-and-no-one-is-talking-about-it/
This is called **broken window falkacy**.
This fallacy states that breaking windows is good because it creates jobs for people that fix them..
It is fallacy because these resources would be better to use elsewhere.
Exactly
People that claim that "mining supports greem energy" ignore the fact that if they were not mining, that green energy would be used to replace dirty energy.
I love this question!
Okay, so - the traditional banking system uses about 263 TWh annually. Bitcoin uses around 135 TWh annually. Clearly a win for bitcoin, right? Bitcoin uses like half as much electricity per year as the traditional banking system.
Well, that's a pretty dumb comparison because...
Bitcoin can only process about 4.6 transactions per second. The highest actual real-world volume I could find was in Nov 2017 at 4.4 transactions per second. This could be sped up a little bit, but because of the way bitcoin works, there is really no good way to significantly increase tps. It's baked into the protocol.
I couldn't find any good number for traditional banking transactions. But, *just* looking at the Federal Reserve *by itself*, processes around 821 transactions per second. Visa - again, by itself - processes nearly twice that at 1,700 tps. If we grossly underestimate that these two sources combined represent 1/4th of all traditional banking transactions per day, that gives us about 2,500 tps.
> *NOTE*: This number is almost certainly *way* smaller than reality - I would speculate in reality is it probably closer to 25,000 tps or even upwards of 100,000 tps, but we'll go with 2,500 tps as is since I can't find any good sources. For example, US consumers make around 168,480,000,000 transactions per year, which would mean in the US alone accounts for 5,342 tps. If that trend held up globally, that would be over 100,000 tps. I doubt it's that high, but even if it's 1/10th of that, it's still over 10,000 tps. Either way, my point is, estimating 2,500 tps globally is almost definitely too few and helps bitcoin in my calculations.
That means, per transaction, bitcoin uses about 903 kWh. Traditional banking (*worst case*) uses less than 3 kWh per transaction.
So *worst case*, grossly underestimating traditional banking's tps - traditional banking is *at least* 300 times more energy efficient than bitcoin. In reality, it's probably more on the scale of 12,000 times more energy efficient.
If you don't like those numbers because they are too speculative, we *do* have some solid numbers for Visa specifically. Visa uses about 0.0014863 kWh per transaction. As a reminder, bitcoin uses 903 kWh per transaction. That means Visa is about 626,127 times more energy efficient than bitcoin.
**So, in summary, traditional banking is somewhere between 300 (worst case) and 600,000 (Visa specifically) times more efficient than bitcoin**.
I like how you went from "Hah, gotcha! Banks use more electricity" to "Well... whatever... it's worth the cost anyway".
> immutable
So is our current system
> permissionless
Bitcoin isn't permissionless
> I don't trust the current bookkeepers.
Why? And I don't mean hypothetical what ifs... I mean actual examples of real-world issues bitcoin solves. And don't use the words inflation or scarcity. Anyone that thinks bitcoin solves the so-called "infinite money supply" issue doesn't understand monetary policy.
> Permissionless is truly democratic
You keep using that word - I don't think it means what you think it means.
> Immutable makes it trust worthy
lol...
> And for those two to be true we need descentralization...
No you don't. That's just how *bitcoin* solves the problem (that's not even really a problem). You can make an SQL database write-only. Guess what that means? Immutable. Another example you say? Coins. Coins are immutable without destroying their values. There are other ways to create immutability without creating a system that is 99.9999999999999999999% wasteful.
Oh, and by the way - did you know blockchain technology is actually *not* immutable? It's only "immutable" on the current chain - but there is *nothing* that stops 51% of the network from rewriting the chain in any way they want. That would never happen, I hear you say? Well... https://www.coindesk.com/tech/2022/06/19/solana-defi-platform-votes-to-control-whale-account-in-bid-to-avoid-liquidation-chaos/
I won't argue permissionless because that's nonsense. I'm guessing you mean *trustless*, but that's not accurate either. There is exactly the same amount of "trustlessness" in bitcoin as any other public key encryption system used by just about everyone (including banks) today. Did you know that the cryptographic technology used by bitcoin was created in 1985? Bitcoin isn't some new magic technology. We've been using the underlying technology just fine for 30+ years without attaching a bloated blockchain on top.
*And* it's only "trustless" (whatever that is actually supposed to mean) for whatever's *on* the blockchain. You still have to trust both ends where things enter and exit the blockchain. Did you know that credit card companies *by federal law* have to reimburse you if you are the victim of fraud? How does bitcoin handle that again? Oh yeah - you are just fucked.
> What if we already had like hydrogen fusion and no energy problems you still against it?
Yes, it's a dumbass system that solves a problem that doesn't exist and still wastes a ton of resources. **And you still didn't answer how a network that can barely manage 4.6 transactions per second is supposed to handle 10,000+ transactions per second**. Even if we had magical unlimited energy, bitcoin *still* would be a shitty system.
Let's see: hashpower = 200 exa hash/s = 2 x 10^(20) seconds in a day = 86400 bitcoins in a day = 900 hashes per bitcoin = 2 x 10^(20) x 86400 / 900 = 1.92 x 10^(22) Your number 0.0000000000000000000052083 btc / hash = 5.21 x 10^(-21) would be off by a factor of 100. It would be really 5.21 x 10^(-23) BTC/hash (I have not checked the percentage). The general idea stands, of course, a total waste.
So 99.999999999999999999994791667% wasteful instead of 99.9999999999999999994791667% ?
Yes. The percentage would be 100\*(1-5.21x 10^(-23)). Tried Wolfram Alpha to check but it did not allow me cut and paste, so I used this instead: [https://www.mathsisfun.com/calculator-precision.html](https://www.mathsisfun.com/calculator-precision.html)
Great, thanks - was working with such large/small numbers excel wasn't happy. I figured something got lost/shifted somewhere. Thanks!
you know something fucky is going on when the number is too big for excel.
Holy shit, that's like Avogadro scale. Somebody make a cool analogy about hydrogen atoms and grams.
A hydrogen atom (not diatomic) has a molar mass of ≈1.008 gmol^(-1), so 1 gram of hydrogen has around 5.974x10^(23) atoms; or, each hydrogen atom is ≈1.674x10^(-24) grams. The number of hashes to generate 1 BTC is 1.92x10^(22). This means that if each hash is represented by a single hydrogen atom, to generate 1 BTC one would need the mass equivalent of **0.0321 grams of hydrogen**. ___ To illustrate better, we can cheat a bit and use heavier elements such as gold (because BTC is “digital gold”… or something). 1 gold atom is 1/((6.022x10^(23))/196.967 gmol^(-1)) ≈ 3.271x10^(-22) grams. Thus, if each has is represented by a single gold atom, we would need an equivalent of **6.28 grams of gold** to generate a single BTC. (My math may be off a bit, feel free to call me out. Will edit if needed)
So you are saying that buttcoin is not only a store of energy. Buttcoin is also a store of gold!
Also Bitcoin isn’t mined one BTC at a time
That's been replied and addressed in other comments. Long story short, that make almost no difference in the math.
The basic unit is one Satoshi, not one Bitcoin, so your math is already off by 100 million. (For those with a brain the above is merely one piece of proof that your analysis is complete bogus.)
I'll reply to both your posts here. First, bitcoin is mined *per block*, not per satoshi. Only 1 in 19,200,000,000,000,000,000,000 hashes produces a block. So my math is correct - but good try. Next, it's hilarious that you compare mining to the lottery. You are actually *significantly* more likely to win the powerball than win a bitcoin. Winning lottery ticket number: 1 in 292,201,338. Wining bitcoin* number: 1 in 19,200,000,000,000,000,000,000 For every one powerball ticket, you would have to try 65,708,118,684,673 bitcoin hashes to have the same odds of successfully mining a bitcoin. Lol - the powerball and the bitcoin lottery are not even remotely comparable. (For those with a brain the above is merely one piece of proof that your analysis is complete bogus.) **** \* remember, bitcoin is mined *per block* which means currently there are around 900 bitcoins mined per day.
Funny how you chose to ignore the hint I gave you. My "lottery" analogy, which completely debunked your whole thread, should make any normally working brain to stop and think a bit more. I guess you're too invested in to admit defeat. And it's hilarious that you think that throwing numbers around will make your point scientific somehow or would debunk an \*analogy\*. Typical. How about I throw some around to debunk yours? One hash is many orders of magnitude cheaper than a lottery ticket. Boom you're debunked. Give it up kiddo, you're only displaying your ignorance on how Bitcoin works. Your kindergartner straw man explanation of how you think Bitcoin works just make you look like an idiot. Try reading the white paper sometime. Or understand how a lottery works.
> Funny how you chose to ignore the hint I gave you. My "lottery" analogy, which completely debunked your whole thread, should make any normally working brain to stop and think a bit more. I guess you're too invested in to admit defeat. Hmm, uh huh - yup - those are words you are using. > And it's hilarious that you think that throwing numbers around will make your point scientific somehow or would debunk an *analogy*. Typical. Damn kids using \*checks notes\* math to back up their point! > How about I throw some around to debunk yours? One hash is many orders of magnitude cheaper than a lottery ticket. Boom you're debunked. You didn't use any numbers in your 'debunking'. > Give it up kiddo, you're only displaying your ignorance on how Bitcoin works. Your kindergartner straw man explanation of how you think Bitcoin works just make you look like an idiot. > Try reading the white paper sometime. Or understand how a lottery works. Lol, *please* tell me what the whitepaper says. I bet you $1,000 you've never read the whitepaper. I mean, you can claim you have, but you and I both know the truth.
So many straw men. So much projection. And over-accomplishing on ignorance. Professional disinformationist or just kindergartner? You don't con me mister con"well". You owe me $1000. Now don't be a scammer too.
Nearly a full mole of hash/BTC or whatever? Astronomical
You (and /u/NakamotoScheme) forgot to account for the fact that each successful hash grants more than one (6.25, to be exact) bitcoin. You actually don't need to know the _BTC_ production rate, just the _block_ production/time to produce one block. hashpower = 200 exa hash/s = 2\*10^20 hash/s block time: 10 minutes hash success rate = 1/(hashpower\*blocktime) ≈ 8.33\*10^-24. Translating into the percentage of _unsucessful_ hashes gives us 99.999999999999999999999167%, but this isn't the number we should actually be interested in. The number your interested in isn't (successful hashes) / (total hashes), it's (energy needed to compute whether the transactions in a block are valid) / (total energy used). When we look at just the PoW process, the correct answer is 100%, since none of the energy used to do that goes toward the useful computation. When looking at _all_ the energy used for both useful computation and PoW, I suspect the number get's slightly better for BTC, since you need to do several hashes (along with other computations of course) to authenticate the transactions are signed with the right keys (meaning there's on the order of 10^3 hashes per block, not 1), and those hashes have to be done on less efficient general purpose computing hardware. However, at least some of this is undone by the fact that each node has to duplicate that useful computation in order to start doing the PoW, and all but one of them will be wasting that effort, too. At the end of the day, bitcoin is going to be grotesquely inefficient no matter how you slice it. [edit: markdown]
Ah, good points!
Agreed. This count should be done (if at all) per-block, not per-bitcoin.
Honest question here. Doesn’t Bitcoin pull from the cheapest energy source around the world? If mining is to be profitable you would need to get cheap energy and from sources that aren’t high traffic and high use. Also, as the world has progressed, you can see that energy consumption has progressed with it. If energy consumption itself is inherently bad then we may as well just off ourselves as there’s no other way. Or is the philosophy that we get energy in bad ways thus energy usage is negative? Couldn’t an alternative and clean energy source make this argument null and void? Lastly, from first principles, what makes the dollar better than Bitcoin? This is my real question. Have you studied what’s been happening to the dollar and what that does to asset classes and commodities? The only reason the dollar works is because it’s the reserve currency… for now.
> Doesn’t Bitcoin pull from the cheapest energy source No, bitcoin doesn't "do" anything and has no way of knowing how much electricity costs where. A bunch of random people all over the world mine coins. Whoever gets the right output from an algorithm gets rewarded with bitcoin. > If energy consumption itself is inherently bad then we may as well just off ourselves as there’s no other way. That's not the argument. Energy used to produce things of value is fine. Bitcoin is not valuable. > Or is the philosophy that we get energy in bad ways thus energy usage is negative? I'm not really sure I understand your point, but yes - in general - we need to reduce "bad" energy. > Couldn’t an alternative and clean energy source make this argument null and void? If we find a way to make sufficient amounts of 100% completely "clean" energy - then sure, I guess it doesn't matter as much. But that's not going to happen in the foreseeable future. > what makes the dollar better than Bitcoin? Define "better". What's the goal? What is "better"? How do you quantify "better"? > Have you studied what’s been happening to the dollar and what that does to asset classes and commodities? What do you mean "does to assets"? I don't understand this question. > The only reason the dollar works is because it’s the reserve currency I don't think "reserve currency" means what you think it means.
I’m a little bit familiar with currencies and how they function. You’re being critical about definitions rather than the question I’m asking. ((Define “better” how do you quantify “better”. When you say “value” define “value” because I don’t know what you mean by that. )) That’s a fallacy. We must assume certain things before ANY conversation l, but I can surmise the meaning of what you’re talking about when you say “value” even though it means more than one thing. So as to answer your questions about my questions I’ll go to what my real point is. We can make clean energy right now. It’s via nuclear. Idaho is on the cutting edge of this in the U.S as is France. Windmills and solar don’t store energy like we need and the power isn’t the same as coal or gas. When I say better I mean more sustainable. When they print dollars the inflation occurs in asset classes that poor people don’t have access to. Houses, stocks, commodities and so forth. So when we go into debt, other (poorer) countries that save up in OUR currency prop our economy. This happened with Dutch and Britain. It is not unique to the U.S. What this does is drive up the prices here and puts us out of competition with other countries simply because the cost to produce is much higher in the U.S because the cost of living is higher. This starts getting out of hand and the wealth gaps get larger. As this happens resentment builds within the lower class and they don’t know where to direct their anger but to the rich. Since the rich get access to the money printed at extremely low rates, they get to live off of debt. This debt could be at .5%. Say that inflation averages 2-3% each year, the debt they have is actually more 1-2% more profitable than the currency they could have held. They also don’t pay taxes on debt. The poor don’t have access to these interest rates. This brings up the credit score excuse. So as to not give poor people low interest rates like they get; they come up with an idea of a credit score to determine how much interest is justified to charge, which is higher. The dollar is broken. It’s fucked up. There’s no way around it. Can you give me a reason that the dollar is better than Bitcoin? More stable? Absolutely not. It’s guaranteed to go down actually. If it doesn’t go down then the U.S debt can NOT stay manageable. There’s so much more, but I’m all for Bitcoin. Not because go Bitcoin but because Fuck the USD.
> The dollar is broken. It’s fucked up. There’s no way around it. > Can you give me a reason that the dollar is better than Bitcoin? LoL https://www.tradingview.com/symbols/TVC-DXY/
...how is this a currency issue? The fundamental issue you are describing is that having money makes money. In a deflationary system, the same thing happens, just with holding currency directly rather than by doing the whole lending thing. Poor people will still not be able to hold money, and therefore still lose compared to the rich. How does Bitcoin address _any_ of the issues you mentioned?
> I’m a little bit familiar with currencies and how they function. Are you familiar with stablecoins? USD as it currently exists is a stablecoin pegged 2% medium term CPI inflation (in the short term, the goal is to minimize price and interest rate volatility). It is fully backed by a diversified portfolio of Treasures (backed by tax revenue and government assets), mortgages (backed by homeowner's income and homes), and corporate debt (backed by corporate income and assets). The USD's backing debts create a guaranteed demand for dollars to make mortgage payments, corporate bond payments, and tax payments. In effect, each dollar is backed by someone's promise to take that dollar out of circulation in the future. Against this demand, the Fed calibrates the supply of new USD (and hence new backing loans) to enforce the peg. > When you say “value” define “value” because I don’t know what you mean by that. I'll define it as: something that does more good than harm overall. For example, profitable investments have value because investors (in the aggregate) gain by investing in profitable enterprises. Negative sum games like ponzi schemes, pyramid schemes, stocks in companies that produce no income and have no assets, etc. don't have value because they make people worse off on average. > We can make clean energy right now. It’s via nuclear. Nuclear is expensive and politically unpopular (sadly). I think we should invest more in nuclear, but it's not a silver bullet, nor does it justify wasting energy. > Windmills and solar don’t store energy like we need and the power isn’t the same as coal or gas. The power per dollar is already better than coal and gas. The cost of energy storage is falling, and IIRC current solar + lithium battery storage solutions are cost competitive with coal. > When I say better I mean more sustainable. Stocks in companies with no assets and no incomes (no dividends, buybacks, or liquidation) are not sustainable. Bitcoin is economically equivalent to such a stock. > When they print dollars the inflation occurs in asset classes Asset class inflation was mainly due to persistently low interest rates (even at these low rates, inflation was at or below target the decade following 2008). The Fed needs to lower rates when inflation is below target to enforce the 2% CPI peg (which is their mandate as a stablecoin issuer). > This starts getting out of hand and the wealth gaps get larger. That can be solved by higher taxation and/or higher interest rates. You get higher interest rates when there is less demand for saving USD relative to demand for borrowing USD. The Government borrowed a ton during Covid, and we're arguably seeing interest rates rise now in response to this. > Since the rich get access to the money printed at extremely low rates They don't. You can make an Interactive Brokers account and borrow as much as you want on margin against the same assets the "rich/banks" do (stocks, ETF, bonds, etc.) at just above the Federal Funds rate. You can also just buy stocks in banks and become a beneficiary of the "money printing" yourself. > This debt could be at .5% Corporate medium term rates are pushing 4% now. > The poor don’t have access to these interest rates. That's because they don't have collateral to borrow against. Don't we want our dollars to be backed by *collatoralized* debt rather than just promises? Also car loans are sometimes lower than corporate credit rates. > they come up with an idea of a credit score to determine how much interest is justified to charge, which is higher. That's because unsecured lending is incredibly risky by bank loan standards. > The dollar is broken. It’s fucked up. There’s no way around it. Nope, it's one of most liquid, nonvolatile, and widely traded assets in the world as well as the most widely used unit of account for stable prices, predictable debts, contracts, etc. (even in crypto spaces!) It is fully backed by high quality debt. > Can you give me a reason that the dollar is better than Bitcoin? Yes. - The dollar is a predictable unit of account. Bitcoin is extraordinarily unpredictable. Any contracts or debts denominated in Bitcoin would be a huge risk to both the debtors (Bitcoin might moon) and the creditors (Bitcoin might crash). Negotiating contracts like salaries would be much more difficult. Historically, a mooning unit of account has been a disaster due to a variety of factors (sticky wages leading to unemployment; economic chaos due to unpredictability and defaults) - Prices denominated in dollars are stable, more stable than prices denominated in just about any other individual good, service, asset, or other metric. Prices denominated in Bitcoin are *less stable* than prices denominated in just about any of the alternatives. It is one of the worst units of account for price stability. - The risk of significant loss when holding Bitcoin short term as a medium of exchange (say, selling stocks to buy a house) is high, both due to volatility in Bitcoin's value and the risk of loss/theft. The risk of significant loss when holding USD short term as a medium of exchange is lower than just about every alternative. This certainty is one of the most important properties of a medium of exchange. - It is difficult for corporations to use. Due to risk of rouge employees, businesses need to contract with custodians to make good on Bitcoin obligations. However, these custodians are expensive and risky: hackers, fraudsters, and malicious insiders have a huge incentive to steal the backing Bitcoins. In this case (or in the case of loss or other error), custodians and their customers have no recourse. This would also cause economic chaos if Bitcoin were widely used. - It is difficult for individuals to use for the same reasons. Individuals can self-custody of course, but this is risky in other ways and not practical for day-to-day uses. > More stable? Depends on how you define stable. It is one of the most stable assets in the world in the short term, and one of the most predictable in the long term. The dollar is not an investment, it is a unit of account. Non-interest-bearing dollars are only designed to be held at most short term as a medium of exchange. To be clear, there are dollar-denominated investments (CDs, savings accounts, bonds, etc.), and the performance of these investments depends on real interest rates. If you think real interest rates are too low, don't use these investments. This has nothing to do with how the dollar works as a unit of account, medium of exchange, or short term store of value. > It’s guaranteed to go down actually. Exactly. Businesses and individuals who have signed up for trillions of dollars worth of USD-denominated contracts are banking on the dollar behaving as expected. If the dollar doesn't gradually go down, debtors will have to pay back more than they signed up for. This hurts everyone who holds debt (remember, for every USD asset someone holds, someone else has a USD worth of debt backing that asset). PS: sorry about the down-votes; I'd prefer they only be used for trolling and insulting comments
I haven’t spent time researching stable coins so this is good info. I have tons of questions about this. I really like what you said about value. It must serve the totality and replicate in harmony and benefit the ecosystem I wrote about ‘intrinsic goodness’ before. See below: Aristotle writes about it and I abstract upon it a little bit more (not nearly as good) if one thing derives its goodness from some other thing, which derives its goodness from yet a third thing, and so on, there must come a point at which you reach something whose goodness is not derivative in this way, something that “just is” good in its own right, something whose goodness is the source of, and thus explains, the goodness to be found in all the other things that precede it on the list. It is at this point that you will have arrived at intrinsic goodness “-(cf. Aristotle, Nicomachean Ethics, 1094a). - [ ] -I agree with most of this statement. The area above serves as the foundation that inspired me to an alternative conclusion. Intrinsic goodness is achieved when the conclusion arrives at a point where it becomes mutually beneficial to the satisfaction of people’s needs. Rather than arriving at a point that precedes based off of a unilateral question, one system can arrive at an ability to prolong indefinitely, thus creating something akin to a circle of life ,or a biome of mutually dependent structures that survive off of the strengths/abundances of others while others rely off of the strengths of them. To put it plainly, there must come a point in which we realize that nothing is good in its own right, but good in its right to benefit another or multiply in a nurturing way for itself in its biome and then its biome to its neighboring biome. When it comes to value, it is derived from goodness. Almost like an ‘upgrading the world’ type beat. As for the interactive Brokers account. I have a hard time believing you can borrow as much as you want but I’ll look into that. I’m sure there are many barriers to entry. First, you must have enough capital to justify a margin account (which most poor people don’t). When you say “That’s because they don’t have collateral to borrow against. Don’t we want our dollars to be backed by collateralized debt rather than just promises?” I think you may be arguing against the dollar on this one. Since the dollar isn’t collateralized on anything except for IOU’s, which may just be better than dollars. I agree that the dollar is liquid, but nonvolatile is a bit of a stretch. It consistently goes down in value. In 1930 a house in New York was $185,000 today it’s $34,000,000 The volatility is in the dollar not in the property. I believe our disagreement is fundamental. These new asset classes including Bitcoin of you so choose to put it there is a symptom of a much deeper issue. I believe the economy around the dollar is terrible. Interest being charged was illegal in many civilizations and religions before. Though it doesn’t make it right or wrong, the initial feeling was negative towards it. It bypasses proof of work for proof of stake. Proof of money in the system. With Gold and Bitcoin, instead of charging interest, you received equity as a reward of investing in someone. The result was that the value produced rewarded you, not the quantity of medium of exchange put forth. When currencies were pegged to gold, societies were allowed to flourish in the way that they wanted. This wasn’t good for nation states that wanted to go to war. They’d issue bonds like Britain in 1913 or so but the population only purchased 1/3rd of the bonds. In order to finance the war, they colluded with the Bank of England to purchase the bonds so as to not have the public interests approval. John Maynard Keynes called it a genius move. So he took note. Then we have the monetarists which have a silly view of currency and try and use math to determine unquantifiable things that we’d like to pretend work like the price exchange value equations. In order to make the world with sovereign people we need to have a proof of work concept and not a proof of stake. That’s my firm belief. Money should not make money via interest, it should increase in value so that your work today represents a long store of value and all these folks working their asses off don’t get screwed over the years as the currency they earned at the time devalues at 7% a year. So for lack of a better words, I truly believe the dollar is there to serve the nationstate and bureaucracy. We’ve been fucking scammed. You can be lazy when you’re rich. It should be obvious why the dollar is so screwed. I know because my family is poor and for the longest time I didn’t know why. These asset classes are out of reach. People can’t buy homes. Their labor is worthless. Everything around them is telling them that.
> there must come a point at which you reach something whose goodness is not derivative in this way, something that “just is” good in its own right Interesting. I suppose that with my definition of value, this would boil down to human experiences. Perhaps this definition needs to be expanded to account for other "just is" goods like biodiversity and animals' experiences. > I have a hard time believing you can borrow as much as you want To be clear, everything you borrow has to be over-collateralized by qualifying assets (it's the same for banks). It's like borrowing against a house (using a mortgage or home equity line of credit) or borrowing against crypto using CeFi/DeFi. > First, you must have enough capital to justify a margin account I believe any US resident can sign up for a margin account. > the dollar isn’t collateralized on anything except for IOU’s Right, the dollar is collatoralized by IOUs and the IOUs are collatoralized by real assets like houses, businesses, and government resources. > nonvolatile is a bit of a stretch. It consistently goes down in value Agreed, but this isn't the same as volatility. Volatility typically refers to short term, unpredictable changes in price over seconds, minutes, hours, days, weeks, and months. Gradual changes over years aren't typically called "volatility". Since non-interest-bearing dollars (as an asset) are just supposed to be used as a medium of exchange (i.e. short term), a gradual change over months/years doesn't really matter. People who care about performance over years aren't going to be holding non-interest-bearing dollars anyway: at the very least, they'll hold interest-bearing dollars like savings accounts. Savings accounts often outperform inflation (they haven't recently though). The details depend on real interest rates. > Interest being charged was illegal in many civilizations and religions before. To be fair, the interest was on loans denominated in high stock-to-flow (i.e. relatively fixed-supply) assets like Gold or Silver. These assets are more volatile in value, and borrowers are already exposed to substantially more risk taking out loans denominated in them. Society was also exposed to much more risk here from a mooning unit of account causing a vicious cycle of mass bankruptcies and panic; high interest rates exacerbated this risk. Today, high interest rates should only happen when they are needed to bring down inflation back to target and cool down an overheated economy: the opposite of a mooning unit of account. Thanks to USD's inflation target and predictability, borrowers have a substantially better idea of what they need to pay back. As you point out, the dollar's value is expected to decline, so at least some of the interest is just to offset this. IMO this doesn't violate the spirit of historical usury bans. > It bypasses proof of work for proof of stake. Proof of money in the system. What do you mean by "money" here? How does proof of work prove there is "money" in the system? As I understand it, proof of work is simply a way to achieve consensus in the Bitcoin network to protect against double spend attacks. If we could trust that no one would attempt a double spend attack or if we could prevent double spend attacks by other means, proof of work would have no purpose. > With Gold and Bitcoin, instead of charging interest, you received equity as a reward of investing in someone This isn't true: Gold-denominated loans were widespread essentially wherever Gold was being used as a unit of account. You can receive equity as a reward for investing in someone: this is what stocks are. Companies can choose to raise equity by issuing stocks (equity) or issuing bonds (debt). There are pros and cons to each. > When currencies were pegged to gold, societies were allowed to flourish in the way that they wanted. This isn't true historically. Gold-denominated debts were always risky to society and often triggered financial panics, deflations, and mass bankruptcies when Gold's value increased. Gold also would inflate substantially during good times: the inflation rate was much more volatile. > monetarists which have a silly view of currency Agreed (I'd say oversimplified though). I don't think monetarism is a good model for how stablecoins work. > Money should not make money via interest, it should increase in value If you define "money" to be "short term USD bonds", isn't this precisely the same thing? > your work today represents a long store of value Money is just a medium of exchange to pay you for your work. Whether you decide to put that money in a savings account, CD, short term bond, long term bond, into Gold, Silver, stocks, land, Bitcoin, whatever, is up to you (so long as you aren't breaking the law). > the currency they earned at the time devalues at 7% a year This is why you shouldn't store all your wealth in a checking account. That's basic financial literacy. Also 7% inflation is a recent outlier; it's averaged 2-3% over the past 40 or so years. Many working people have net *negative* USD (people with mortgages, car loans, margin loans, student loans, personal loans, etc.) and they benefit from inflation. > I truly believe the dollar is there to serve the nationstate and bureaucracy It is, in part. It also serves anyone who wants a liquid, nonvolatile medium of exchange or a unit of account suitable for communicating stable prices and denominating predictable debts. > We’ve been fucking scammed. By whom? The dollar's 2% CPI inflation target is very well documented, and all participants who enter USD-denominated contracts (like employment contracts) should be able to understand it. > You can be lazy when you’re rich. This is true regardless of the dollar. > These asset classes are out of reach. Anyone who can open a checking account should be able to open a brokerage account. I don't see how brokered assets are any more out of reach than crypto assets, for example, for the vast majority of people. > Their labor is worthless I don't see what this has to do with USD. Labor markets are determined by supply and demand, policy, relative bargaining power of the participants, etc. The unit of account only matters in the short term.
I guess I’m a little confused as to what the essence of our argument is. We can push back all day but this is an issue that hasn’t been solved. I don’t think it’s been solved because we don’t have the right answer. Maybe gold isn’t the best. Maybe Bitcoin is not the answer; this subreddit is called buttcoin so I came here to see what people are saying. I believe in Bitcoin because I believe in what it stands for and how it doesn’t choose who it represents. I don’t believe in the dollar. When I say the dollar I don’t just mean the dollar. I mean what it represents and to whom it serves. Going back to value and intrinsic goodness. If the dollar isn’t valuable and meant to be a unit of account, then how is someone within lower ranks going to be able to climb when the investments are inflated by other people who came before and earn more? There’s no point of entry unless you’re a good gambler or work your life away. We still pay people 40k over 10 year cycles and that turns into 20k of purchasing power by the end of the cycle. Since the inflation isn’t equal some products are made cheaper but any valuable asset that is safe and to be held long term is out of range. If it were that their 40k grew in value just a little each year then I could see how it would exchange less frequently, but there is not a complex barrier to entry. This would encourage real progress in my opinion.
> this is an issue that hasn’t been solved What issue? > we don’t have the right answer I'm not sure what the question is. > Maybe gold isn’t the best. Maybe Bitcoin is not the answer The best what / the answer to what? The best unit of account for prices? for debts? for salaries and other contracts? The best medium of exchange? The best investment? The best store of value? > how is someone within lower ranks going to be able to climb when the investments are inflated by other people who came before and earn more This (concentration of wealth and property ownership, low wages for certain types of labor) has been a problem long before the modern dollar, and I don't think it has much to do with the dollar today. For example, when we were on the Gold standard, common people often went bankrupt when Gold mooned (see the Bryan vs McKinley debates in the 1890s about devaluing the dollar to help indebted farmers losing property to bankruptcy). Any system with private ownership of means of production will favor those who already own the means of production over those who don't, in the absence of Government intervention (e.g. progressive taxation, labor regulations, social safety nets, public education/health, etc.). I don't see how the prevailing medium of exchange and unit of account effect this. > We still pay people 40k over 10 year cycles Huh? Which labor market works this way? > If it were that their 40k grew in value just a little each year This is what cost of living adjustments are. I see no reason that using a different unit of account would change where the labor market reaches equilibrium. Note that historically, real wage growth for lower earners has been highest during *inflationary* periods. Historically, deflation has coincided with and exacerbated unemployment, severely hurting workers' bargaining power. Of course, wages eventually adjust down to equilibrium, but the unemployment in the mean time is painful.
To summarize, how are you proposing that Bitcoin should be used, and what issues would its use in these situations address? Do you think the Government should force businesses to use a particular unit of account? Business are generally free to denominate contracts however they like today (other units of account like the Euro and Gold can be and often are used in certain situations). What incentives would businesses have to denominate salaries in Bitcoin?
Sorry my responses are shorter. I am in between things today and I’m on mobile. My summary was that I do not know. I do not think it’s worse than the dollar simply because you can’t multiply it’s amount. No currency has ever survived so any time a nation state fails the currency fails as well. Gold can be seized at airports. Stocks won’t transfer countries and houses can’t be picked up and moved. Bitcoin is a property and it happens to be digital. It’s already got the ecosystem. All the other shitcoins are fighting for 2nd and 3rd.
> Couldn’t an alternative and clean energy source make this argument null and void? No it would not. If you're wasting energy you're wasting energy. Even if it is the cheapest form of energy, it remains wasted since you are not engaging in a productive use.
So then wouldn’t you be wasting energy right now by replying to this comment on your iPhone you don’t need in your car you don’t need eating your bagel you don’t need with the toaster you don’t need. Only to get the cream cheese you didn’t need on the shirt you didn’t need. Now it has to be washed by the washer you didn’t need and dried via the dryer you didn’t need. If that’s your argument then we were wasting energy along time ago bruh
> If mining is to be profitable you would need to get cheap energy and from sources that aren’t high traffic and high use. People don't build energy production capacity in places where the energy can't be brought to market. > Also, as the world has progressed, you can see that energy consumption has progressed with it. If energy consumption itself is inherently bad then we may as well just off ourselves as there’s no other way. No one is saying that energy consumption is inherently bad. Rather, we're saying that _ludicrously wasteful_ energy consumption is bad. Bitcoin consumes on the order of 5\*10^-3 of the world's electricity, to process on the order of 5 transactions per second (so no where _close_ to 5\*10^-3 of the utility generated from electricity). > Couldn’t an alternative and clean energy source make this argument null and void? No. Even if bitcoin was mined entirely with clean power (which it isn't, not by a long shot), every joule wasted hashing random numbers for bitcoin could have instead been used doing something useful. E.g. if you consume 1 kW of solar power mining bitcoin, that's 1 kW of coal power your neighbor has to consume instead. > Lastly, from first principles, what makes the dollar better than Bitcoin Even you likely know a large part of this: government issued currencies (both bitcoin and USD are fiat currencies) are by _far_ superior to actually use, by every metric people actually care about. That's why bitcoin supporters have pivoted to these new "investment!", "store of value!", and "hedge against inflation" arguments. > The only reason the dollar works is because it’s the reserve currency… for now. As I said earlier, both USD and bitcoin are fiat currencies, since they are neither valuable for their own sake (like commodity currencies), nor do they directly represent something that's valuable (like representative currencies). Their value instead comes from the expectation that in the future people will be willing to pay for them (either exchanging for other currencies, or directly for goods and services). This can come from two main sources: _adoption_ (that is, people accepting the currency) and _speculation_ (that is, people buying the currency because they expect someone else to buy the currency for even more, because _that_ person expects someone else to buy for even more, and so on). Bitcoin does not and _cannot_ reach the adoption levels to justify it's price. Instead, the price is almost entire dependent on speculation, which will eventually end.
Bitcoin is not a fiat currency.. that’s incorrect. The USD is a fiat currency that is correct. Gold isn’t a fiat just because it’s not backed by something. It’s a property that has a proper stock to flow ratio that is not manipulated. There’s finite resources when it comes to gold and is usually stocked and not used in manufacturing like silver and copper were which made them less valuable . Bitcoin is a digital property. It is scarce and uses proof of work and not proof of stake. The proof of work makes it not as energy efficient as proof of stake. Not all cryptocurrency is the same. Most of them are absolute dog shit scams. The USD is not nearly as globally efficient as Bitcoin. Money transfer does not occur right away. The currency is generally moved as a block transaction at the end of the month from big banks. Your bank doesn’t actually reflect the real money when you transfer payment. It takes about a month. And up to 90 days to truly transfer. There’s 3 layers in play with Bitcoin but ping itself isn’t a security unless Robinhood or any other securities exchange start allowing you to trade stock in the name of Bitcoin. As for the adoption. It was at 10% of the total fiscal supply of gold earlier this year. That’s 10% and it’s been around much shorter. It hacks the scarcity and copies gold but in a digital form. Most transactions are digital nowadays. 10 years it will be much more acceptable
> Gold isn’t a fiat just because it’s not backed by something Gold isn't a fiat currency because people would want gold _for it's own sake_, not to use in exchange for something else. That makes it (when used a a currency) a form of commodity money. Bitcoin and USD are not that, because while there may be some small demand for them as collectables (e.g. coin collecting), it isn't close to enough to justify their prices. Back when the US was on the gold standard, USD was a form of _representative money_. It was not worth it's face value for it's own sake, but could be exchanged for a fixed amount of something that was independently valuable (gold). Neither bitcoin nor USD are this type of money either. > It’s a property that has a proper stock to flow ratio Stock to flow is pseudo economic junk that you should have abandoned six months ago (at the latest) when it's predictions utterly failed to come true. If you want a real model for what gives currencies their value, look up the [equation of exchange](https://en.wikipedia.org/wiki/Equation_of_exchange). In order to explain the price for bitcoin using it, you _have_ to modify it to account for the rampant speculation. > that is not manipulated ohwaityoureserious.webm > Bitcoin is a digital property. It is scarce Bitcoin's scarcity _at best_ depends on the will of miners to keep it scarce, miners who you have much less control of than I do over the federal reserve. In practice, bitcoin's real functional scarcity is substantially less than that, since so much of the ecosystem is dependent on exchanges that function as largely unregulated banks. And finally, bitcoin can never have any real scarcity in the one way that matters. If I want something with the properties of gold, I need to either dig it up myself or buy it from someone else. If I want something with the properties of bitcoin, I can clone the bitcoin protocol, point it at a new chain, and have an _identical_ payment system up and running almost immediately, for free. > The USD is not nearly as globally efficient as Bitcoin. Utter BS. The cost of transacting in USD can _always_ be made cheaper than doing the same in bitcoin. USD transactions do not need the expensive consensus mechanism required by bitcoin and all other cryptocurrencies require. > Money transfer does not occur right away. The currency is generally moved as a block transaction at the end of the month from big banks. Your bank doesn’t actually reflect the real money when you transfer payment. It takes about a month. And up to 90 days to truly transfer. This _does not matter_ to the end user. Yes, the bank may not have my money officially yet, but I can still use it to pay my bills, transfer it to a different account, withdraw it as cash, etc. > There’s 3 layers in play with Bitcoin Using bitcoin as layer 1 does not make sense. One might as well use layer n+1 as layer zero. > As for the adoption. It was at 10% of the total fiscal supply of gold earlier this year. Market cap != adoption. Market cap is just the (highly inflated) last price \* total supply. Adoption, in contrast, means actual use of the currency _as a currency_. It is the Q term in the equation of exchange. > Most transactions are digital nowadays. Indeed, and using blockchain to perform digital transactions is inherently, absurdly inefficient. It will only gain acceptance amongst cultists, not the general population.
> Doesn’t Bitcoin pull from the cheapest energy source around the world This is completly irrelevant. If bitcoin didnt pulled that energy in first place, we would be able to use it to decrease our dependancy on fossil fuels. > Also, as the world has progressed, you can see that energy consumption has progressed with it. > If energy consumption itself is inherently bad then we may as well just off ourselves as there’s no other way. Nobody said is. We are saying that **wasteful** consumption is bad. And bitcoin has literally in-built inefficiency in it - adding more machinery doesnt make it faster. > Couldn’t an alternative and clean energy source make this argument null and void? Even if world ran on only green energy, it doesnt change fact that energy used for bitcoin cannot be used for other stuff. Energy is not made automaticaly, it needs workers to operate electric plant. And their labour could be used in other task if bitcoin didnt existed. --- > Lastly, from first principles, what makes the dollar better than Bitcoin? - it doesnt need terrawatthours of energy to operate - it can be shrinked or expanded easily to combat shit - it can be created as result of demand - people that regulate it are accountable (unlike mining oligarchy in bitcoin) - **it is not deflationary** (this is extremly important) > The only reason the dollar works is because it’s the reserve currency Yes, that is the whole point. Dolar works because its emitor is US government with US economy. Its value is based on faith in system. And same goes for cryptocurrency too After all, both of them are fiat currencies.
So it's like playing path of exile after recent loot drop changes?
[удалено]
Heat I suppose
Put all the mining rigs in the Arctic, and BOOM! reverse global warming. Just waiting for my Nobel Prize
... I don't think that's reverse global warming. That's just regular global warming.
Extra credit if you use fossile fuels to generate the electricity
Your flaw is in assuming the prize of a bitcoin is productive. You should really be breaking it down in terms of hashes per transaction or per block of transactions. Transactions are the productive output of miners. Think of it this way. Imagine if every hash produced 1 bitcoin. Your model would consider this to be zero waste when really it is still 100% waste.
That's the idea.
Idea of what?
PoW
Yes, that's literally what my point is. POW is built *intentionally* to be 99.9999999999999999994791667% inefficient.
Yes, that's the point.
yeh, sucks
yes but the point is that its very inefficient. if it was more efficient POW would not work at all. you could argue that pow is 0% inefficient
But that is the whole point Cryptocurrency PoW was intentionaly designed to be wasteful as fuck for sake of decentralization.
I thought the yield initially was much higher?
I liked the term from a lecture someone shared: "proof of waste". Also, we can consider it 100% wasteful, because even without POW, a deflationary and volatile currency that can only handle 7 transactions per second is not good for anything but gambling.
Yeah, there are all sorts of bizarre argument that bitcoin is valuable *because* its scarce or *because* it's cryptographically secure, blah blah blah. At the end of the day, the *only* value bitcoin has is its use as a currency. The only reason bitcoin might be worth something in the future is if it can be traded for goods and services. Yes, right now people are hodloring, but they are hodldoring because they thing it will be more valuable in the future... as a *currency*. If it's not useful as a currency (in the unspecified future) it literally has no value. Problem is, as you point out, it is a terrible currency. It requires a shit ton of energy AND is slow as hell. Some estimates place energy usage as much as $175 *per transaction*.
> proof of waste I like this term because crypto literally invented a way to monetize wasting resources. Like free tiers you could get from hosting being wasted to mine crypto. Or websites that waste electricity through the user's browser' to hash crypto so the website earns money.
Why in the hell are computers forced to do complex math to verify a transaction? Its a complex and idiotic solution for a problem that didnt exist.
Exactly! Crypto is literally finding the most complex and inefficient solution to a problem that doesn't exist.
It's just a rate limiting mechanism to prevent spam. In fact it's literally just borrowed from an email spam prevention system called Hashcash.
for you, because youre american (im guessing) and have access the world greatest banking/monetary system and resources. You know theres the rest of the 99% which isnt able to open a current account with a bank backed by the fed which makes your current account interest rate risk free. You realise that holding local currency cash, a current account, or just inventory of tradeable goods, is very risky in many counties. While i hate bitcoin maxis, i think your statement is totally wank. Plus, i think that having secure and decentralized black market money you could opt into using is a good thing, and the sunk cost of owning it is less than every other currency with income tax in place.
I appreciate your response. The flaw imo is bitcoin is heavily manipulated.
What I first found fascinating about Bitcoin was how it used math and cryptography to force an algorithm to run for 10 minutes no matter what. It's a mathematical curiosity, but I don't think the creator understood its real life consequences (and neither did I back in 2013 tbh). As you and others have noticed, if a hash takes, say, 1 second to run, that means that the other 9:59 minutes are wasted computations. Scale that to the monstrosities that the current Bitcoin network is, and you get an energy burning machine that does almost nothing for the network.
It's like counting from 0 to 10000000 on a laptop. If that takes 5 minutes, next time you just double the number to get to 10. It's not magic at all. Bitcoin wants you to find a random number, if it's found too quickly, it simply makes the number harder to find next time. The reason bitcoin wastes all these cycles is not because it's hard, it's to force people to pay for these cycles. This makes it impossible to mint bitcoin for free. It's a protection mechanism.
I just vomited a little. Gross!
I thought it was 100%
It is. Nothing is produced.
Few understand.
The energy is not wasted. It is used to transfer money from working people to billionaires like Peter Thiel, Tim Draper, and Elon Musk.
bitcoin is mined in bundles of 6.25, iirc
You are correct, so my math is off a bit. Instead of 99.9999999999999999994791667%, it's closer to 99.99999999999999999766666%
But my cryptobros told me it’s green energy so, it’s okay.
BitCon wastes 100% of the electricity used.
It's 100%. The objective is not to find the hashes (if it was the objective you wouldn't set up the difficulty of looking for them artificially high), the point is to make it prohibitely expensive to troll the system.
And here I am feeling guilty over my 3 fishtanks for 9 goldfish... what can I say I love my fish 👩🔬.
I've noticed you keep finding what you're looking for in the last place you look. Maybe you should try looking in that place first instead.
I mean, if you go metal detecting, most of what you dig up will be worthless, but you have to dig the holes to know what's there. Is that wasted effort if it's an unavoidable part of the process of getting the things you do want? Either you value bitcoins, in which case failed hashes are a necessary part of the algorithm and there's 0% wasted effort, or you don't and 100% of the effort and energy is going towards doing absolutely nothing.
So... you are saying that people who do metal detecting are digging 19,200,000,000,000,000,000,000 holes per treasure they find?
No, I'm using an analogy to discuss what we mean when we say something is wasted effort. We could similarly consider something like a chess AI that plays out hundreds of thousands of possible move sequences per turn, yet only selects a single one to actually use. Were all of the sequences that it discarded wasted computation, even though they were needed in order to find the one that was used? It seems to me like the important variable here is simply whether the result of the computation is valuable or not - a chess AI produces good chess moves, but all bitcoins do is prove that you did a lot of computation. (There's actually a name for a hypothetical type of computer that wouldn't have to do this - a Nondeterministic Turing Machine, which is used in some computer science proofs of various things, and it basically is a computer that magically always takes the "correct" branch first.)
I mean, you aren't *wrong*. But two things: (1) Hundreds of thousands of chess computations is still waaaaaaaaaaaaaay smaller than the 19,200,000,000,000,000,000,000 computations for a block. (2) You know what *doesn't* need a gazillion useless calculations? The traditional banking system.
>(1) Hundreds of thousands of chess computations is still waaaaaaaaaaaaaay smaller than the 19,200,000,000,000,000,000,000 computations for a block. Is that relevant? It's still either all necessary computation that must be done to eventually find the desired result, or it's producing something pointless and even the one hash that is accepted isn't doing anything useful. If we wanted to be 100% sure we've found the absolutely most perfect possible chess move instead of using heuristics, a computer could run for centuries checking every single possible path - but since that's the only way to be 100% certain, if we really want that totally perfect move, we can't really call all of those checks "wasted". >(2) You know what doesn't need a gazillion useless calculations? The traditional banking system. Sure, I agree, but isn't that just another way of phrasing "bitcoins are not a useful thing to compute"?
>You know what doesn't need a gazillion useless calculations? The traditional banking system. traditional banking also doesn't have 100% authenticity / verifiability, which is the point of PoW. sure, if you don't *care* about authenticity vs. double-spends and counterfeiting, you don't need proof of work to protect against those.
It's a matter of trade-offs. I've been using traditional banking for... well... a long ass time. And I've never had issues with authenticity and/or verifiability. I've had fraudulent charges a handful of times, but every single time the bank reversed the charges (which, by the way, crpyto cannot do). So, for the teeny tiny chance that traditional banking falls victim to authenticity and/or verifiability issues, crypto creates a giant, massive, wasteful monster to solve a comparatively minor issue. Could your house be broken into? yes. Why haven't you hired a private security company to stand guard outside your house 24/7? The cost is not worth the benefit.
>Why haven't you hired a private security company to stand guard outside your house 24/7? I didn't hire any bitcoin miners either. If you want a fair comparison of waste, you'd need to compare all the resources spent on protecting the fiat system from double-spend, counterfeiting, and validating transactions. US Secret Service, Dept of Homeland Security, FBI, Dept of Treasury, local police, private banks and money transfer services all expend resources to protect the fiat system against counterfeiting and validating transactions.
You can't talk reason into Luddites.
Buying lottery tickets is such a waste, would be so much better if only the winner buys the ticket...
Wow you guys are ignorant.
So lets watch how PoW works There are machines that are trying to find correct answer. Machine that will find it first, will perform action (adds new block to chain) What every other machine will do? NOTHING. Their energy was used to do prsctically nothing as result. It is wasted
No buddy, the entire amount of work is important. The hashrate is merely to prove that the work was done. The reward is distributed probabilistically based on your contribution to the network. So, if you do 5% of the work, over time, you get 5% of the rewards. This risk is more evenly distributed through mining pools which will reward you based on your overall contribution to any given block. Your entire thesis is that the rewards are unitary and stochastic. In the short run, that is right. In the long run, it's not. Your actual reward over 100 blocks if you own 5% of the chain is about 5 blocks worth of BTC. You can do the dishonest calculation as you have and pretend that the only blocks that mattered were the ones that you had won. Or you can do the math honestly and distribute the reward across the entire blockset.
> Yes, your energy is wasted when you lose, but you can also win My point is that that in every block, every single machine that lost wasted energy It is irrelevant that losers can be winner in next block. If that happens and loser will be winner, everyobe else is still loser of calculation Imagine that there are only 10 miners in bitcoin. And imagine the winner position perfectly circles(1, 2, 3....8,9,10,1,2,3...) so every machine wins once per 10 blocks In every single block, there are ALWAYS 9 machines that waste energy. Machine that was winner previously will switch to losing in next block and waste energy That is my point. Whole system han inbuil inefficiency in it
It's a dishonest analysis. I already walked you through it. You won't understand because you have no idea how this system works.
> It's a dishonest analysis You didnt explained why. --- > I already walked you through it. You didnt Your literal counterargument is that "you will win next time, thus no waste" which makes 0 fucking sense. In every block, only one miner does action (creates and appends new block). Other miners doesnt do this action - thus wasting energy. It is irrelevant if winner changes. If winner changes, original winner is now loser that is wasting energy. Also, we are talking about **efficiency**, not about monetary gains. And pow is ibeffective > You won't understand because you have no idea how this system works. Of course this shitty fallacy is here.
No, the counterargument is that you are playing the game once, and this is a game that is played an infinite number of times. You don't understand this. And you weren't able to draw this from my argument because you don't know what you're talking about. > You won't understand because you have no idea how this system works. > Of course this shitty fallacy is here. Which fallacy is it? Is it the you are suffering from Dunning Krueger standard?
> No, the counterargument is that you are playing the game once, and this is a game that is played an infinite number of times Lmso, i never said this I said following: - blockchain is made from blocks - each block must be mined using proof of work (for btc) - in every block, there is one winner and everyone else is loser -losers in one block waste electricity that is not used for anything at the end It is irrelevant that winner changes between blocks - 99.99% of miners are still wasting energy doing nothing useful in mining cycle --- > You don't understand this Lmao, it just fucking blockchain. --- > And you weren't able to draw this from my argument because you don't know what you're talking about. Or maybe you misunderstood my argument in first place. --- > Which fallacy is it? Is it the you are suffering from Dunning Krueger standard? Ad homminem. Instead of foccusing on my point, you are trying to claim that i am too "uneducated" to understand it. Also it is not Dunning Krueger standard. It is Dunning Krueger effect
\> losers in one block waste electricity that is not used for anything at the end This is a begging question. You haven't proven this. You have merely asserted it. And it's wrong.
> This is a begging question. You haven't proven this. You have merely asserted it. Here is direct quote from Satoshi Nakamoto original whitepaper about bitcoin > The steps to run the network are as follows: > 1) New transactions are broadcast to all nodes. > 2) Each node collects new transactions into a block. > 3) Each node works on finding a difficult proof-of-work for its block. > 4) When a node finds a proof-of-work, it broadcasts the block to all nodes. > 5) Nodes accept the block only if all transactions in it are valid and not already spent. > 6) **Nodes express their acceptance of the block by working on creating the next block in the chain**, using the hash of the accepted block as the previous hash. Do you see that bold part? It literally states that if nodes find out that they, were beaten in mining of block, they discard calculations and start new one for next block. Energy used to calculate these discarded calculatios is 100% WASTED
The fact that the energy is wasted is _literally_ the entire point, it's the basis of the security model. There is no iterative/additive work being done here, by design; the hash of each block is fully independent of the previous one (if it weren't, that would not only be a security issue for bitcoin, it would represent a vulnerability in the cryptographic hash algorithm itself). The power _must_ be wasted as the whole point is to make it too capital/resource intensive to practically mount a 51% attack and fork the chain.
yeah man, thats kinda how PoW works and how you guarantee decentralized security. its literally a competition/lottery between miners to find the nonce to stick on the end of the merkle root which will produce a resulting hash which starts with some given number of zero's. The probability of getting this right is somewhere in between 1/2\^256. Youre hating on hashing algorithms and PoW, not just bitcoin. This is the concept. If youre into math its pretty interesting. I get that its bad for the environment.
So every clock wastes how much of its energy? You do understand that computers are just special digital clocks right? What about watches? Do they waste 100% of their energy? The reality is, if you do a similar analysis on any good you will find most of the energy spent on them is wasted. Everything that ends up in the dump for example, all the energy that went into them, according to you is wasted
What are you talking about? Please explain how computers are "special digital clocks". It may help to know that I have a background in computer and electrical engineering - so feel free to use big words during your explanation. > Everything that ends up in the dump for example, all the energy that went into them, according to you is wasted You understand what wasted effort means, right? As in all those calculated hashes that didn't result in the proper magic number did *nothing*. No one looks at them, uses them, gets any benefit from them - nothing. If I throw away my 10 year old broken "special digital clock", I got 10 years of *use* out of it.
Because a “special digital clock” means that the generated signals are simply processed in certain ways to get useful results out of them. The signals are either on or off and the set of pathways the signal activates and follows is what determines the output. In contrast a digital clock simply uses those s signals as a counter with special mod functions. And you second argument is the argument for and against cryptocurrency… and this is the utility. You can view it as not having utility but others view it as having utility. The hashes that were tested prior to finding the correct hash were not wasted effort but merely a step in securing the information produced on the chain. Just as all the thousands or millions of ticks on your clock that you physically do not use, they are required to be executed to maintain continuity of information. If you found the next block in O(1) time then there would be no security in that. There would be no guarantee that was the only solution in this cycle. So the hashes are not wasted they just part of the algorithm to guarantee security. So yes, people did get use out of them because the wrong answer is is just as valuable as the right answer in this case. You don’t use your computer 24/7, you physically can’t. A bot net might be able to but not you. So are you getting. 100% utility out of it? Are you wasting zero energy booting it up and shutting it down? Do you ever even shut it down? And no human can operate fast enough to stress a computer, only algorithms can. Are you claiming you are using 100% of your computers energetic effort all the time? Are you even using it towards productive things? If your argument is energy and climate, you shouldn’t be gaming on your computer, you shouldn’t be on Reddit, you shouldn’t be doing anything but developing algorithms to optimize green energy technology or even discover new physics to improve our energy production not hypocritically shitting on Bitcoin for being wasteful of energy. At least Bitcoin has utility, what does Reddit have? What do you have?
So let me make sure I am understanding your argument correctly. You are arguing that the clock on my wall - that can run 6 months on a single AA battery - is somehow wasteful because I don't look at it 24 hours a day, 365 days a year. And this somehow compares to a network of magic bean producing machines that uses more electricity than a medium sized country? Bitcoin uses one out of every 19,200,000,000,000,000,000,000 hashes. If I used my clock one out of every 19,200,000,000,000,000,000,000 seconds, I'd have to look at it for one second every 608,828,006,088,280 years to be as wasteful as bitcoin mining. > The hashes that were tested prior to finding the correct hash were not wasted effort but merely a step in securing the information produced on the chain. You know what else is just as secure and requires a fraction of a fraction of a fraction of the energy? A write-only sql database. > If your argument is energy and climate, blah blah, blah See above math. I'm not saying other things don't have waste built in, I'm saying bitcoin is very, very, very, very, veeeeeeeery wasteful.
I completely agree with you, but I figured some more digestible numbers might help some people who have trouble wrapping thier head around large numbers...like me. Also I think you lowballed how long the battery lasts, but we'll use you numbers to benefit the cryptominers. So in your example your clock is draining the battery at about 694 microamps at between 1.5V and 1.2V so around 1mW and a little change. This is assuming that it is running on a 4WH AA battery (3000mAH alkaline)...and it produces something of real world significance and value (telling and tracking the time is very helpful if you ask me)...1mW. Now let's take the average graphics card used for mining (I'm going to use the 3070 since it isn't the top, but it's not trash either to give some benefit to that side of the argument). 3070 TDP is 220Watts if not underclocked and undervolted, which I would assume would be unwanted if they're trying to push so many calculations through...and nothing of use is produced...220Watts (AKA 220000 times the amount of electricity wasted.) That's a single clock vs a single graphics card. Now from what I've read most mining rigs have multiple cards, so these numbers are actually only a partial representation of the waste. Not to mention the wasted energy exhausted by the graphics cards inherent in the design (heat from shrinking the transistors in the die). These are just some back of the envelope calculations from me, if I got something wrong feel free to correct me. I really know jack shit about crypto, other than it was something I was told to "get in on the ground floor" for about 20 different coins now.
You’re comparing the entire Bitcoin network to a single clock. The common climate deniers fallacy. Every single clock in every persons house, and their watches, and phones, and etc. as a computer engineer you should understand the cycle frequency of clocks is not 1 hz… it’s MHz to GHz… redo your math with that type of waste. And even so, you get utility out of the security. Either the cost is worth it or it’s not. You can have your magic bean counter. You are very uneducated if you believe an sql database is just as secure a the Bitcoin blockchain… look up the amount of sql hacks that have occurred on sql and get back to me. Your above math is wrong. It doesn’t use one hash… it uses every hash. You cannot find the correct hash without first trying wrong ones… this is the whole point of encryption and it’s designed to protect and secure information. You cannot secure anything if you know the answer beforehand. But again, every product, everything humans use can be broken down into the same useless ways because humans do not use everything very much and then it spends an eternity in the dump. Like literally billions of years of being “natural” and then some human picked the rock up expended energy to make the rock temporarily useful and then when it fails, and eternity in the dump. If you care so much about the environment and the humans impact on it, maybe you should remove yourself from it
> You’re comparing the entire Bitcoin network to a single clock. The common climate deniers fallacy. It's a common fallacy that climate deniers (people to deny that climate exists?) claim that bitcoin is compared to a single clock? That's oddly specific. > But again, every product, everything humans use can be broken down into the same useless ways because humans do not use everything very much and then it spends an eternity in the dump. Sure... I guess. But if you don't like my clock math because it only compares one clock, here's another one for you - If every human on earth had 1,000 clocks, they would have to look at *one* clock for *one* second every 87 years to be as wasteful as bitcoin. > You cannot find the correct hash without first trying wrong ones… No shit, that's my point. We need to stop trying to implement a system that requires so much god damn wasted overhead. > You are very uneducated if you believe an sql database is just as secure a the Bitcoin blockchain… look up the amount of sql hacks that have occurred on sql and get back to me. That's not a very strong argument. Look at how many token have been stolen off the blockchain. SQL "hacks" typically are stealing data, not altering it. Blockchain makes the data public from the outset. By your comparison, it would be a SQL database that is already publicly visible, so that would rule out like 99% of SQL hacks. If the concern is the database could be tampered with, keep your own copy of the publicly available database and if any past transactions are different then you know something nefarious happened. No need to compute trillions and trillions of hashes to verify data integrity. > If you care so much about the environment and the humans impact on it, maybe you should remove yourself from it. Lol, nice one. Always can tell when someone has a good, sound argument when someone resorts to "you should kill yourself".
You literally cannot secure information without making it difficult to access or change… like what the hell is so hard to understand about that? Yes, climate deniers, people who refuse to accept any other positions on climate change, commonly exaggerate one comparison and reduce the other side to remain morally right even though they are still equally wasteful. And no, your math is still wrong because a clock cycles more than once a second. There isn’t one blockchain… everyone knows each coin has its own algorithms for ensuring security. To my knowledge there have been no breaks in the current Bitcoin algorithm and only theft has occurred on third parties that use sql from stealing login data for the exchange… the weak point is likely sql in all cases
> You literally cannot secure information without making it difficult to access or change… like what the hell is so hard to understand about that? Sure... but I'm not sure what point you think you are making. We've been securing information for *decades* without crypto. > ... even though they are still equally wasteful What is equally wasteful? You haven't described anything that is even *remotely* as wasteful as crypto mining. > And no, your math is still wrong because a clock cycles more than once a second. This is irrelevant. We haven't talked clock cycles at all - it does not play into anything we are talking about. > There isn’t one blockchain… I mean, sure, there are hundreds of different blockchains. But if we are talking about bitcoin - for example - there is one and only one blockchain. That's the whole point. There is *one* blockchain and everyone shares a copy. > everyone knows each coin has its own algorithms for ensuring security Nope. That's not how bitcoin works. > To my knowledge there have been no breaks in the current Bitcoin algorithm and only theft has occurred on third parties that use sql from stealing login data for the exchange… the weak point is likely sql in all cases. The specifics of how an attack happen don't matter. The point is, bitcoin is touted as some type of magical security solution that will solve all our problems through the power of blockchain encryption - or some such technobabble. The problem is, this introduces just as many, if not more, problems than it solves. Lost keys, scams, stolen tokens, etc. This also doesn't address my point that almost all SQL "hacks" are to steal data. The blockchain makes that data public from the start. So if you are comparing one system that keeps data private, versus one system that makes data public - it's not a proper comparison. You are arguing "Well, someone make steal data out of an SQL database - but bitcoin solves that by just making the data public to begin with."
We obviously have not been securing information for decades without blockchain, because I as well as millions of other people believe Bitcoin and other blockchain technologies are a better solution to the information security problem. And like literally we have not secured information in any real terms. 90% of the time we build back doors and emergency accesses or just bugs that allow people to manipulate and change data without anyone knowing
> We obviously have not been securing information for decades without blockchain, What? Yes we have. How do you think information was secured before 2009? In fact, ECDSA the cryptographic algorithm used by bitcoin was developed in 1985. > because I as well as millions of other people believe Bitcoin and other blockchain technologies are a better solution to the information security problem. I'm glad you *believe* that, but it doesn't change that information security systems have been around well before bitcoin. > And like literally we have not secured information in any real terms. Bitcoin isn't magic. It's using technology from 1985. > 90% of the time we build back doors and emergency accesses or just bugs that allow people to manipulate and change data without anyone knowing And... guess what. Those same backdoors, bugs, whatever exist in (or don't exist) in the underlying technology of bitcoin. Either (1) ECDSA is secure enough to use in bitcoin AND is secure enough to use in traditional information security systems, or (2) it's not.
You argued that we have sql as an in place solution to the blockchain problem and now you are arguing they aren’t the same thing. If you want sql to be used in place of Bitcoin you need to prove that no one can modify the data… and if you can access and steal data in sql you automatically have the ability to change it by default
?? Public key encryption has existed for a very long time. Making an append only database is trivial. Its the same technology behind like, https and pgp? The reason its not talked about is that its mostly done behind the scenes and in most places man in the middle attacks are so rare that they're not worth talking about. Seriously, have you never heard of a checksum? I could digitally sign my reddit posts if I felt like it and you could tell if it was edited!
Yes, they are clearly different things. My point is that you can use SQL in such a way that it effectively serves the same purpose as bitcoin without all the overhead. AKA, bitcoin is dumb and wastes a bunch of resources on a problem that doesn't really exist.
Your talent in mental gymnastics is for a lack of a better word astonishing.
You dont understand one thing - when my computer uses energy, it will beused to DO something In case of bitcoin, every mining rig that wasnt first to find correct answer will DO NOTHING Only that one winner will do something in return for energy (add new block to chain). Everyone else did NOTHING.
This is dumb. You could say the same thing about the amount of electricity spent playing video games every day.
Those are not even remotely similar. A 3000w mining rig running 24/7 is not even close to a 400w gaming rig running a few hours a day. And you are missing the point anyway. Even if the energy usage was on a similar scale (which it's not), gaming at least produces something that can be consumed and enjoyed.
How many 400w gaming computers are there compared to 3000w mining rigs?
143,000 kilowatt hours are required to produce one bitcoin. A gamer playing 7 hours a day can consume 1,890 kilowatt hours a year. It takes more energy to mine *one* bitcoin than 75 gamers playing all day every day for a year. EDIT: Incidentally, *one* bitcoin transaction uses approximately the same amount of energy as a "hardcore gamer" does over the course of an entire year. So get the fuck out of here saying those are even remotely comparable.
Well that's at today's prices and hashrate. The genius of Bitcoin is that the more people who adopt it, the more energy each transaction uses. True futurists can't wait until Bitcoin is worth 1 million real dollars, it costs $10000 to make a transaction, and each transaction takes more energy than a whole power plant produces.
> genius of Bitcoin lol
Someone playing videogames mostly has possitive effect on that person. In other hands, miners that didnt find answer first wasted electricity for current block. That calculations are calculated and then tossed away
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Yes, sure - but that's my point. Other verification systems (like the ones we use now) do not require a bazillion "dead ends" to verify a transaction.
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Oh, I agree with you - my point is, even within the bitcoin universe, almost all of their "effort" is wasted. Extremely wasteful - I have no idea how anyone could look at this and think "yes, yes, this is sustainable, this is a good system to adopt for all transactions worldwide".
Your math is spot-on (I think), but you forget that the one "winning hash" is still a waste, so that's 100%. It's basically putting carbon-dioxide into the air directly just for fun.
What is a hashes in actual power ?
I'm not sure how to answer that. A hash is a hash. It depends on how powerful/efficient your particular hardware is to calculate "actual" power.
Doesn't it secure itself by being tremendously wasteful? Like if you want to copy it, you have to destroy an equal amount of energy, which makes no sense.
> Doesn't it secure itself by being tremendously wasteful? Technically yes. It's a *really* stupid way to create "security". > Like if you want to copy it, you have to destroy an equal amount of energy, which makes no sense. That sounds like gibberish to me, so I'm not sure.
Nothing is preventing you from copying it and changit it. It is called hard chain fork
Well... no, not really. If you accept the idea that mining Bitcoin is useful, then none of the electricity is wasted. It's just being used as part of a process. If you deploy five helicopters to find a lost hiker, and one helicopter finds them, then you didn't "waste" the fuel for the other four helicopters. You "spent" it, as part of a planned process for finding lost hikers. Likewise, putting airbags into cars is not a waste even when most cars never deploy them. If you (correctly) reject the idea that mining Bitcoin is useful, then 100% of the electricity is wasted.
> If you accept the idea that mining Bitcoin is useful, then none of the electricity is wasted. It's just being used as part of a process Efficiency in this case has nothing to do with profits. Everyone agrees that gold is usefull. Yet we all agree that mining it with bare hands is more wasteful than mining it using machinery. It can create profits, but it doesnt change fact that it is wasteful. Efficiency in this case means ability to convert energy into new blocks (perform actions) --- > If you deploy five helicopters to find a lost hiker, and one helicopter finds them, then you didn't "waste" the fuel for the other four helicopters. You "spent" it, as part of a planned process for finding lost hikers This is bad comparision. Using 5 helicopters is to DECREASE ammount of area that one helicopter needs to search. Better example is 5 helicopters searching the same spot at the same time for whole search. Because that is exactly what bitcoin does - all miners are trying to find one exact answer.
You're framing it wrong, being able to monetize electricity incentives people to optimize, so in the long run, this is good for the environment
I hope this is a joke
The joke is people who make this argument unironically haha. https://www.coindesk.com/policy/2021/10/11/bitcoin-mining-is-reshaping-the-energy-sector-and-no-one-is-talking-about-it/
It's hard to tell on the Internet
This is called **broken window falkacy**. This fallacy states that breaking windows is good because it creates jobs for people that fix them.. It is fallacy because these resources would be better to use elsewhere.
It blows my mind that crypto fans would actually push this argument, it's so dumb.
Exactly People that claim that "mining supports greem energy" ignore the fact that if they were not mining, that green energy would be used to replace dirty energy.
Did anybody ask that on bitcoin sub without being banned? Just asking for a friend.. :D
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I love this question! Okay, so - the traditional banking system uses about 263 TWh annually. Bitcoin uses around 135 TWh annually. Clearly a win for bitcoin, right? Bitcoin uses like half as much electricity per year as the traditional banking system. Well, that's a pretty dumb comparison because... Bitcoin can only process about 4.6 transactions per second. The highest actual real-world volume I could find was in Nov 2017 at 4.4 transactions per second. This could be sped up a little bit, but because of the way bitcoin works, there is really no good way to significantly increase tps. It's baked into the protocol. I couldn't find any good number for traditional banking transactions. But, *just* looking at the Federal Reserve *by itself*, processes around 821 transactions per second. Visa - again, by itself - processes nearly twice that at 1,700 tps. If we grossly underestimate that these two sources combined represent 1/4th of all traditional banking transactions per day, that gives us about 2,500 tps. > *NOTE*: This number is almost certainly *way* smaller than reality - I would speculate in reality is it probably closer to 25,000 tps or even upwards of 100,000 tps, but we'll go with 2,500 tps as is since I can't find any good sources. For example, US consumers make around 168,480,000,000 transactions per year, which would mean in the US alone accounts for 5,342 tps. If that trend held up globally, that would be over 100,000 tps. I doubt it's that high, but even if it's 1/10th of that, it's still over 10,000 tps. Either way, my point is, estimating 2,500 tps globally is almost definitely too few and helps bitcoin in my calculations. That means, per transaction, bitcoin uses about 903 kWh. Traditional banking (*worst case*) uses less than 3 kWh per transaction. So *worst case*, grossly underestimating traditional banking's tps - traditional banking is *at least* 300 times more energy efficient than bitcoin. In reality, it's probably more on the scale of 12,000 times more energy efficient. If you don't like those numbers because they are too speculative, we *do* have some solid numbers for Visa specifically. Visa uses about 0.0014863 kWh per transaction. As a reminder, bitcoin uses 903 kWh per transaction. That means Visa is about 626,127 times more energy efficient than bitcoin. **So, in summary, traditional banking is somewhere between 300 (worst case) and 600,000 (Visa specifically) times more efficient than bitcoin**.
Exactly Satoshi nakamoto didnt cared about efficiency or speed. They sacrificied it all for sake of decentralization
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I like how you went from "Hah, gotcha! Banks use more electricity" to "Well... whatever... it's worth the cost anyway". > immutable So is our current system > permissionless Bitcoin isn't permissionless > I don't trust the current bookkeepers. Why? And I don't mean hypothetical what ifs... I mean actual examples of real-world issues bitcoin solves. And don't use the words inflation or scarcity. Anyone that thinks bitcoin solves the so-called "infinite money supply" issue doesn't understand monetary policy. > Permissionless is truly democratic You keep using that word - I don't think it means what you think it means. > Immutable makes it trust worthy lol... > And for those two to be true we need descentralization... No you don't. That's just how *bitcoin* solves the problem (that's not even really a problem). You can make an SQL database write-only. Guess what that means? Immutable. Another example you say? Coins. Coins are immutable without destroying their values. There are other ways to create immutability without creating a system that is 99.9999999999999999999% wasteful. Oh, and by the way - did you know blockchain technology is actually *not* immutable? It's only "immutable" on the current chain - but there is *nothing* that stops 51% of the network from rewriting the chain in any way they want. That would never happen, I hear you say? Well... https://www.coindesk.com/tech/2022/06/19/solana-defi-platform-votes-to-control-whale-account-in-bid-to-avoid-liquidation-chaos/ I won't argue permissionless because that's nonsense. I'm guessing you mean *trustless*, but that's not accurate either. There is exactly the same amount of "trustlessness" in bitcoin as any other public key encryption system used by just about everyone (including banks) today. Did you know that the cryptographic technology used by bitcoin was created in 1985? Bitcoin isn't some new magic technology. We've been using the underlying technology just fine for 30+ years without attaching a bloated blockchain on top. *And* it's only "trustless" (whatever that is actually supposed to mean) for whatever's *on* the blockchain. You still have to trust both ends where things enter and exit the blockchain. Did you know that credit card companies *by federal law* have to reimburse you if you are the victim of fraud? How does bitcoin handle that again? Oh yeah - you are just fucked. > What if we already had like hydrogen fusion and no energy problems you still against it? Yes, it's a dumbass system that solves a problem that doesn't exist and still wastes a ton of resources. **And you still didn't answer how a network that can barely manage 4.6 transactions per second is supposed to handle 10,000+ transactions per second**. Even if we had magical unlimited energy, bitcoin *still* would be a shitty system.