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When I read this: "This shortcoming is highlighted by recent studies showing that PoW is highly inefficient with respect to operating cost and ecological footpr

When I read this: "This shortcoming is highlighted by recent studies showing that PoW is highly inefficient with respect to operating cost and ecological footprint." The moment we try and do away with this inefficiency we are going against the entire solution of what bitcoin was going for: how to use all of the inefficient computer parts laying around the globe for something useful? It makes me think people just don't get it. High inefficiency is the _ENTIRE_ point! It gives rarity to the coin. That 10 minute block time is the same as compressing millions of years of geology into 600 seconds. It is fundamentally sound mathematics, and ultimately, that is why it holds its value. It is not meaningless mathematics, people who say that don't understand fully as to what they are talking about, imho.

ricardobeat 9y ago
> how to use all of the inefficient computer parts laying around the globe for something useful? How do you reconcile this statement with the fact that mining is done by a few thousand entities in the whole world, using custom-built hardware?
wlesieutre 9y ago
You're misinterpreting what people mean by "inefficient" in this context. The bitcoin mining ASICs are extremely efficient at mining bitcoins. You can't mine them with an old GPU and expect to make back more money than you spent on electricity. But the choice to mine bitcoins at all is (arguably) an inefficient use of resources that could have been used for pretty much anything else. There's no shortage of useful problems to be worked on by supercomputers and the world would be better off if we did that instead of mining cryptocurrencies. But the economic incentives aren't there. EDIT: Reading your comment again, I think I was a bit quick on the "you're wrong" here. ISo to clarify, I do agree that inefficiency is at the core of the bitcoin mining ecosystem, but it's all about the "we have to spend a bunch of energy that could've done a lot of other things" inefficiency, not an individual "we can use old hardware for this" sort.
- Nursie 9y ago
  When you look at it from that angle, Bitcoin becomes a very interesting hack on economic incentives (and how they don't always map to useful real-world activity)
  - jstanley 9y ago
    Whether you think Bitcoin mining has real-world utility or not depends entirely on whether you think Bitcoin has real-world utility or not. Without Bitcoin mining, there is no Bitcoin.
    - Nursie 9y ago
      Certainly, but whether you think bitcoin has any real-world utility, bitcoin-mining certainly has economic incentives.

ricardobeat 9y ago

> how to use all of the inefficient computer parts laying around the globe for something useful? How do you reconcile this statement with the fact that mining is done by a few thousand entities in the whole world, using custom-built hardware?

wlesieutre 9y ago

You're misinterpreting what people mean by "inefficient" in this context. The bitcoin mining ASICs are extremely efficient at mining bitcoins. You can't mine them with an old GPU and expect to make back more money than you spent on electricity. But the choice to mine bitcoins at all is (arguably) an inefficient use of resources that could have been used for pretty much anything else. There's no shortage of useful problems to be worked on by supercomputers and the world would be better off if we did that instead of mining cryptocurrencies. But the economic incentives aren't there. EDIT: Reading your comment again, I think I was a bit quick on the "you're wrong" here. ISo to clarify, I do agree that inefficiency is at the core of the bitcoin mining ecosystem, but it's all about the "we have to spend a bunch of energy that could've done a lot of other things" inefficiency, not an individual "we can use old hardware for this" sort.

Nursie 9y ago
When you look at it from that angle, Bitcoin becomes a very interesting hack on economic incentives (and how they don't always map to useful real-world activity)
- jstanley 9y ago
  Whether you think Bitcoin mining has real-world utility or not depends entirely on whether you think Bitcoin has real-world utility or not. Without Bitcoin mining, there is no Bitcoin.
  - Nursie 9y ago
    Certainly, but whether you think bitcoin has any real-world utility, bitcoin-mining certainly has economic incentives.