8 ms·

The big concern I think, is the insane use of electricity, which is manageable for now, but could really go overboard in a hurry.

paulgb 9y ago
Yes. The cognitive dissonance around this in the cryptocurrency community is worrying.
- QAPereo 9y ago
  Not surprising though, given that said dissonance allows for profits to be pursued.
  - michaelchisari 9y ago
    "It is difficult to get a man to understand something, when his salary depends upon his not understanding it."
tome 9y ago
I would be interested to know what is the cost of that electricity per bitcoin transacted. Credit card processing fees are a small number of percent, AIUI. Is it comparable?
- carlmr 9y ago
  Currently it stands at 250kWh per transaction. My two person household in a developed country with lots of appliances uses 6 Bitcoin transactions per year in electricity. Bitcoin eletricity uses is insanity and it's only set up to rise. https://digiconomist.net/bitcoin-energy-consumption https://digiconomist.net/bitcoin-energy-consumption
  - tome 9y ago
    Interesting. According to https://www.ukpower.co.uk/home_energy/tariffs-per-unit-kwh https://www.ukpower.co.uk/home_energy/tariffs-per-unit-kwh the price per kWh in the UK is of the order of 10p. So a transaction costs 25 pounds? That surely can't be right.
    - QAPereo 9y ago
      Depends on how/when you're getting/spending your electricity. If you're just running your mining operation out of your home, during daylight hours then you'd probably be about right. Presumably mining successfully has a lot to do with getting your electricity at a steep discount. The way we generate electricity, that's entirely possible at certain times. We're not going to stay in that relatively narrow band for long though, with the growth of this thing. There's only so much "spare" on the grid, off-peak, and this whole thing relies on wasteful means of energy production, storage and transmission. So on one hand (hopefully) the opportunity to scavenge for cheap CPU cycles is going to contract, while the market for bitcoin expands? Yikes.
    - rsynnott 9y ago
      Big miners are likely using somewhat cheaper electricity than that, but yeah, the cost of a transaction could well be in that range. The cost of a transaction to a bitcoin _user_ is now significant.
    - eggpy 9y ago
      That is correct on order of magnitude, at least (25 pounds ~ $33 today). That's one of the reasons Steam is no longer accepting bitcoins[0]: > transaction fees that are charged to the customer by the Bitcoin network have skyrocketed this year, topping out at close to $20 a transaction last week (compared to roughly $0.20 when we initially enabled Bitcoin). [0] http://steamcommunity.com/games/593110/announcements/detail/1464096684955433613 http://steamcommunity.com/games/593110/announcements/detail/...
    - nicky0 9y ago
      About right. The block reward more than pays for it.
    - 9y ago
  - danieltillett 9y ago
    The sooner this bubble bursts the better. Bitcoin has become an environmental obscenity.
- wz1000 9y ago
  It is profitable for the entire network to burn upto 12.5*price of bitcoin dollars worth of coal every ~10 minutes. At $15,000 a BTC, that means miners can consume $27,000,000 worth of electricity a day and still remain profitable. This amount varies linearly with the price of BTC.
  - PeterisP 9y ago
    As a corollary to this, the cost per transaction also varies linearly with the price of BTC - the more useful BTC becomes for investors/speculators/as a store of value, the less useful it becomes as a tool for transactions. On the other hand, the high valuation can only be justified by the expectation of it being a really good tool for transactions (or, alternatively, the greater fool theory) and becoming bad at transactions means it'll eventually become also a bad store of value; so a technical solution to transaction cost is highly needed.
Balgair 9y ago
It should decrease (long term) as the amount of 'mining' naturally goes down with the lessened 'reward', per the schedule. The fee based crypto-breaking should be less. As dedicated crypto-breaking hardware is manufactured with an eye towards energy efficiency things should also get better. In the short term, yes, this is totally crazy. But in a few years, things should be much better. That said, how fucking sci-fi is this?! Remember in the old games and novels how 'energy credits' would be a currency unit in the future. Well, looks like we are in the future then. Bitcoin is pretty much a 'baby' energy credit, it's also more than that, but it is an energy credit in a nascent way. I mean, that's pretty cool to teenager me.
- Taniwha 9y ago
  yes, but it's a spent energy credit, it's not like you can reverse it and spend the work, on something else - it has no value other than as a possible future negative asset, something you might be required to purchase carbon credits to cover
deleted 9y ago
[deleted]

paulgb 9y ago

Yes. The cognitive dissonance around this in the cryptocurrency community is worrying.

QAPereo 9y ago
Not surprising though, given that said dissonance allows for profits to be pursued.
- michaelchisari 9y ago
  "It is difficult to get a man to understand something, when his salary depends upon his not understanding it."

tome 9y ago

I would be interested to know what is the cost of that electricity per bitcoin transacted. Credit card processing fees are a small number of percent, AIUI. Is it comparable?

carlmr 9y ago
Currently it stands at 250kWh per transaction. My two person household in a developed country with lots of appliances uses 6 Bitcoin transactions per year in electricity. Bitcoin eletricity uses is insanity and it's only set up to rise. https://digiconomist.net/bitcoin-energy-consumption https://digiconomist.net/bitcoin-energy-consumption
- tome 9y ago
  Interesting. According to https://www.ukpower.co.uk/home_energy/tariffs-per-unit-kwh https://www.ukpower.co.uk/home_energy/tariffs-per-unit-kwh the price per kWh in the UK is of the order of 10p. So a transaction costs 25 pounds? That surely can't be right.
  - QAPereo 9y ago
    Depends on how/when you're getting/spending your electricity. If you're just running your mining operation out of your home, during daylight hours then you'd probably be about right. Presumably mining successfully has a lot to do with getting your electricity at a steep discount. The way we generate electricity, that's entirely possible at certain times. We're not going to stay in that relatively narrow band for long though, with the growth of this thing. There's only so much "spare" on the grid, off-peak, and this whole thing relies on wasteful means of energy production, storage and transmission. So on one hand (hopefully) the opportunity to scavenge for cheap CPU cycles is going to contract, while the market for bitcoin expands? Yikes.
  - rsynnott 9y ago
    Big miners are likely using somewhat cheaper electricity than that, but yeah, the cost of a transaction could well be in that range. The cost of a transaction to a bitcoin _user_ is now significant.
  - eggpy 9y ago
    That is correct on order of magnitude, at least (25 pounds ~ $33 today). That's one of the reasons Steam is no longer accepting bitcoins[0]: > transaction fees that are charged to the customer by the Bitcoin network have skyrocketed this year, topping out at close to $20 a transaction last week (compared to roughly $0.20 when we initially enabled Bitcoin). [0] http://steamcommunity.com/games/593110/announcements/detail/1464096684955433613 http://steamcommunity.com/games/593110/announcements/detail/...
  - nicky0 9y ago
    About right. The block reward more than pays for it.
  - 9y ago
- danieltillett 9y ago
  The sooner this bubble bursts the better. Bitcoin has become an environmental obscenity.
wz1000 9y ago
It is profitable for the entire network to burn upto 12.5*price of bitcoin dollars worth of coal every ~10 minutes. At $15,000 a BTC, that means miners can consume $27,000,000 worth of electricity a day and still remain profitable. This amount varies linearly with the price of BTC.
- PeterisP 9y ago
  As a corollary to this, the cost per transaction also varies linearly with the price of BTC - the more useful BTC becomes for investors/speculators/as a store of value, the less useful it becomes as a tool for transactions. On the other hand, the high valuation can only be justified by the expectation of it being a really good tool for transactions (or, alternatively, the greater fool theory) and becoming bad at transactions means it'll eventually become also a bad store of value; so a technical solution to transaction cost is highly needed.

Balgair 9y ago

It should decrease (long term) as the amount of 'mining' naturally goes down with the lessened 'reward', per the schedule. The fee based crypto-breaking should be less. As dedicated crypto-breaking hardware is manufactured with an eye towards energy efficiency things should also get better. In the short term, yes, this is totally crazy. But in a few years, things should be much better. That said, how fucking sci-fi is this?! Remember in the old games and novels how 'energy credits' would be a currency unit in the future. Well, looks like we are in the future then. Bitcoin is pretty much a 'baby' energy credit, it's also more than that, but it is an energy credit in a nascent way. I mean, that's pretty cool to teenager me.

Taniwha 9y ago
yes, but it's a spent energy credit, it's not like you can reverse it and spend the work, on something else - it has no value other than as a possible future negative asset, something you might be required to purchase carbon credits to cover

deleted 9y ago

[deleted]