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The energy isn't wasted, it is converted. The closest analogy I can come up with is that gold used to back currency isn't wasted because it is stored in an unde

The energy isn't wasted, it is converted. The closest analogy I can come up with is that gold used to back currency isn't wasted because it is stored in an underground vault rather than being used for jewelry or as a component in electronics. If you are creating a currency, then it has to be backed by something: gold, silver the cost of electricity, people's faith that the currency is worth something. A currency not backed by something will keep deteriorating until it is worthless (assuming a free market, the dollar doesn't collapse because only the us mint can make them).

fulafel 9y ago
Gold takes untold amounts of natural resources, energy, capital and human labor to dig up just to sit in a vault. That seems the definition of waste.
- walterstucco 9y ago
  It fits more with the definition of treasure
Nursie 9y ago
>> The energy isn't wasted, it is converted. The vast majority goes on hashing as fast as possible and getting the wrong answer many, many times... that seems pretty wasteful.
- kortex 9y ago
  If I pan some dirt and it does not contain gold, I got the "answer" wrong. If I dig a hole and it contains no oil, I got the answer wrong. Seems pretty wasteful. Scarecity is driven by an inability to readily harvest/create something.
  - Nursie 9y ago
    So what? If you pan for gold and don't find any, that energy is wasted, not converted. So what? The initial claim wasn't "This facet of mining cryptocurrency is like gold" it was "The energy used is converted". It's not. It's burned. >> Scarecity is driven by an inability to readily harvest/create something. Cryptocurrency scarcity is artificial, and not driven by anything other than predefined scarcity curves. Even if two guys with CPU-only miners were the entire BTC network, scarcity would be the same, but energy output would be vastly lower. The busy-work that is done for (say) BTC is only necessary because of the aversion to central currency authority in certain subsections of society. It's an artifact of that ideology.

fulafel 9y ago

Gold takes untold amounts of natural resources, energy, capital and human labor to dig up just to sit in a vault. That seems the definition of waste.

walterstucco 9y ago
It fits more with the definition of treasure

Nursie 9y ago

>> The energy isn't wasted, it is converted. The vast majority goes on hashing as fast as possible and getting the wrong answer many, many times... that seems pretty wasteful.

kortex 9y ago
If I pan some dirt and it does not contain gold, I got the "answer" wrong. If I dig a hole and it contains no oil, I got the answer wrong. Seems pretty wasteful. Scarecity is driven by an inability to readily harvest/create something.
- Nursie 9y ago
  So what? If you pan for gold and don't find any, that energy is wasted, not converted. So what? The initial claim wasn't "This facet of mining cryptocurrency is like gold" it was "The energy used is converted". It's not. It's burned. >> Scarecity is driven by an inability to readily harvest/create something. Cryptocurrency scarcity is artificial, and not driven by anything other than predefined scarcity curves. Even if two guys with CPU-only miners were the entire BTC network, scarcity would be the same, but energy output would be vastly lower. The busy-work that is done for (say) BTC is only necessary because of the aversion to central currency authority in certain subsections of society. It's an artifact of that ideology.