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Bitcoin mining and energy consumption
- Canada 9y agoLooks like the HN domain name extraction rules need an update for .hk
- cesarb 9y agoThe current public suffix list (https://publicsuffix.org/ https://publicsuffix.org/) already has org.hk as a suffix, so HN might be using an outdated version of the list.
- robin_reala 9y agoIts base reward (currently at 12.5 Bitcoin per block) will half every four years, until it reaches zero. That’s not how halving works.
- Xophmeister 9y agoBTC is discrete, to 8dp, rather than being represented by rational numbers, so eventually it will reach zero from rounding.
- jannes 9y agoMaybe the author was thinking about rounding? At some point the reward will reach the equivalent of $0.00 (rounded to pennies)
- jrimbault 9y agoComputers can't keep dividing, at some point halving will reach "0". (funnily I had forgotten until your comment that in real[sic] mathematics, you can keep dividing)
- tromp 9y agoThe current reward of 12.5*10^8 satoshi will reduce to 1 satoshi in exactly 30 halvings (120 years), and the next halving after that will truncate it down to 0 satoshi.
- moneytide1 9y agoThe electricity consumption is a red flag, but perhaps it could be cheaper than the cost to build and maintain Guarda/Loomis trucks that carry physical currency, energy to melt metal to mint coins, and all the costs of building brick&mortar banks (even then, bankers provide auxiliary services like loans and advisement). We are all spending time talking about it as a collective effort to determine whether or not it should be adopted in order to optimize the transfer of value. Ultimately it could flush out the middlemen who just seek rent by being a financial gatekeeper. Bitcoin isn't entirely different from that. Many folks see it as a slot-machine. Buy, sit on it, cash out back to federal reserve notes. Profit. The question here is - what will those proceeds be spent on? If people are still conditioned from an early age to seek out excessive hedonistic experiences, what are we gaining by implementing bitcoin? Part of me sees bitcoin explanations as a Rorschach test - you can observe some character traits of the person through their explanation or prediction of bitcoin. I am wary of the entire thing because we are starting to spend more time talking about money. Or making money on money. It just has nothing to do with what we actually DO with our time/resources. But that is content for a different thread. I am not a financial expert. Just working-class trying to invest surplus cash. I want to use simple terms and concepts and condense the complex discussion.
- sandworm101 9y agoThese numbers are far beyond the energy required for trucks hauling cash. And they dont fully account for the truck-type energy to build and manage the bcoin mining industry.
- lawlessone 9y agoThere's also the creation of the cash, printing or melting. and the resource extraction for it. The losses due to counterfeiting.
- jackpeterfletch 9y agoWe're starting to stop using cash anyway though right? Regardless of blockchain.
- 9y ago
- joss82 9y agoFrom a quick research online, it seems that most mining pools are located in China [1] Roughly 2/3rd of electricity in China is produced from burning coal or gas, which, upon combustion, emit their own weight in CO2, basically. [2] From this two facts, one can conclude that Bitcoin has a pretty huge carbon footprint overall. This is not the impression that I got from reading that article. [1] https://bit-media.org/bitcoin/where-in-the-world-are-bitcoin-mines-located/ https://bit-media.org/bitcoin/where-in-the-world-are-bitcoin... [2] https://en.wikipedia.org/wiki/Electricity_sector_in_China https://en.wikipedia.org/wiki/Electricity_sector_in_China
- wcoenen 9y ago> coal or gas, which, upon combustion, emit their own weight in CO2, basically Fossil fuels emit much more than their weight in CO2 when burned. A CO2 molecule produced by burning typically includes two oxygen atoms from the atmosphere.
- kevinthew 9y agoYeah, the article makes some false claims about how electricity markets work. By driving up power demand, you're incentivizing fossil fuel usage as it is the marginal molecule. The cheap power on the grid is already likely being max utilized, so any incremental kwh from bitcoin will come from the next cheapest source. Globally, that's probably coal or natgas.
- ben_w 9y agoThree times their weight in CO2. The C’s and the O’s are similar (ish) masses.
- vog 9y agoIf I remember correctly, mining farms (and data centers in general) are usually colocated to an energy source, i.e. a plant. Some of those plants are not fully stretched, because there's almost no civilization nearby, so delivering to the next city comes with a huge loss in the energy network. So miners can get cheap energy from those plants - energy that would otherwise be unused or lost anyway. Not sure how much this saves in the end, but this shows that you can't simply convert energy to CO2 emission without considering which types of plants are used and where these are located.
- ben_w 9y agoMakes a reasonable effort to calculate bitcoin energy use (and it’s good to share reasoning, not just headline totals!), but it falls short with the whataboutism of, for instance, shipping gold by aircraft. Assuming all flights are independently profitable, the cheapest ticket I've seen from London to San Francisco is £261 return, which sets an upper limit on fossil fuel emissions of about 6 barrels of oil equivalent. Me plus luggage is about 100kg, which at current prices is worth £3.292.122,21
- drinchev 9y agoI don't get why journalists are not writing about the criminal side of Bitcoins. Lots of "users" ( not investors ) interested in Bitcoins are actually .onion sites or other shady / crime organisations. They actually don't care for human life and I doubt they will care for electricity consumption.
- have_faith 9y agoDo you know of any sources that try and track this sort of thing? like as a rough percentage of dirty money in the system. Because I get the impression that with the recent run of people getting in the percentage of shadyness is dropping as result because of the massive increase in volume from speculators.
- zaphar 9y agoHonestly Bitcoin is probably an improvement for law enforcement. Cash is more anonymous. Bitcoin is completely public and traceable while in the network. And the moment you pull it out of the network you are connected to a real world entity.
- lagadu 9y agoFor the same reason they don't write about the criminal side of using fiat currency. Lots of users are criminals who sell drugs or rob people and are paid in pesky, untraceable coins and banknotes and do it just to receive those.
- OhDagny 9y agoBanks make tons of money laundering illegal operations. You don't think they are licking their chops over bitcoin too?
- yonatron 9y ago"Stellar maintenance entities, are those pesky Star-beavers ruining your convective zone? Do their hydrogen dams constantly clog up radiation from your photosphere? Never fear! With new extra-strength Dam-begone, your star will shine as brightly as 4 galactic years ago! Stay radiant! Stay prominent! Don't wait. Get Dam-begone this rotation! Operators are standing by.". - (I think you might have meant "hydroelectric generator dams")
- alborzmassah 9y agoIs this not the price paid for the trust, security, and utility that bitcoin brings? I don’t hear alternatives being suggested.
- matt4077 9y agoHow about not bitcoin, where a transaction doesn't consume 9 day's worth of an average family's energy budget? Utility: a transaction costs $10, right? It's useless. Security: Have you followed this? The actual recommendation is to print your private keys and stick them in a vault. Trust: It's funny that, fundamentally, people started doubting the Federal Reserve when the gold standard was abolished, because suddenly "value of money is just fiction". Yet here they are, imbuing some far more ephemeral nothingness with the same sort of faith-based value.
- empath75 9y agoLol trust. 90% of bitcoin traders have their money on unregulated exchanges.
- UncleEntity 9y agoPeople doubted the Federal Reserve long before 1971...
- matt4077 9y ago....and Bitcoin can't even dream of the trust that comes with having been doubted long before 1971.
- Asdfbla 9y agoTrust and security, maybe, but actual utility? That's far from clear. Cryptocurrencies have a rather extreme threat model and it's not clear at all that people who are not regime critics or criminals (I don't mean to disparage suppressed people here by lumping them in with criminals though) really benefit from that model. Most people are quite happy with trust-based currencies which don't have the proof of work overhead. Cryptocurrencies have their utility, but not for the whole population.
- seanwilson 9y agoOne of the big selling points of Bitcoin is that it's meant to be decentralised but it doesn't look like this plays out. Proof of work seems to inevitably lead to all the power going to parties that can afford specialised hardware who are in countries with low electricity costs. Running a Bitcoin miner on commodity hardware now is pointless which seems to go against the spirit of Bitcoin when it started. Was this predicted at the inception of Bitcoin? It's interesting how economics impacts the security of the protocol like this. Proof of stake is meant to consume less resources but then the power is then handed to people with the most money? Coming up with a way to have a decentralised currency where everyone involved gets a fair say without consuming too many resources is a super interesting problem.
- Slartie 9y agoThat highly depends on the hashing algorithm used. For Bitcoin this is SHA256, which is very well-suited for ASIC implementation. The algorithm of Ethereum was deliberately designed to be ASIC-resistant, but GPU-friendly, therefore GPUs (which are kind of a commodity) are the hardware of choice for Ethereum mining. Monero takes this one step further by having an algorithm that is ASIC-resistant and that can be mined just as well on GPUs as on CPUs, which is probably the best you can get with regard of mining decentralization. The result is that Monero mining is much more spread-out and distributed over the world than Bitcoin mining. The advantage of low electricity cost is of course something that cannot be eliminated without eliminating Proof of Work entirely.
- seanwilson 9y ago> That highly depends on the hashing algorithm used. For Bitcoin this is SHA256, which is very well-suited for ASIC implementation. The algorithm of Ethereum was deliberately designed to be ASIC-resistant, but GPU-friendly, therefore GPUs (which are kind of a commodity) are the hardware of choice for Ethereum mining. Is it possible to create ASIC resistant algorithms? Litecoin was meant to be resistant by using scrypt but there's ASICs out for that now I believe. Could you not create a protocol that constantly changes its hashing algorithm to combat ASICs? > The advantage of low electricity cost is of course something that cannot be eliminated without eliminating Proof of Work entirely. Any views on what the ideal system would be? I've heard of using a combination of proof of stake and proof of work. Proof of stake will mean people with more money get more power and proof of work means people with lower electricity costs get more power so neither seems ideal. I think ideally each person in the world would get an equal vote in how the protocol progresses but it's not obvious how you could enforce that.
- albertgoeswoof 9y agoBitcoin's electricity consumption is unfortunate, it's difficult to assess whether it is a waste or not. The current position blockchain tech can be compared to the state of networked computers in the 70s and early 80s. Not a huge amount of value delivered at the time, yet very few could have foreseen the impact of the internet and personal computing on the world. If blockchains and distributed computing does present a new leap forward in how we communicate, this electricity will not be wasted.
- QAPereo 9y agoIs it a waste to burn CPU cycles, to have a chunk of entropy to wave around so that you can possibly buy shit? Yes.
- mazlix 9y agoHow are you able to definitively say that's more of a waste than to gather cotton and linen and then print money?
- QAPereo 9y agoFalse dichotomy... electronic transactions and bitcoin are hardly synonymous.
- saalweachter 9y agoEh, I'd call it more of a "tu quoque" (appeal to hypocrisy).
- nathan_f77 9y agoI think you're right that it's not an ideal situation, but humans are not an ideal species. We don't yet live in some Star Trek (or The Orville) world where currency has been abolished and everyone acts altruistically all the time. Cryptocurrencies might be able to serve as a stop-gap before we figure out how to get there. It keeps everyone honest. In the future, it might even replace the entire tax code. There would be no more fines or punishments, and companies would no longer be able to hide their profits offshore. Taxes could just be automatically collected from each transaction, and managed by some global organization (maybe the UN). The world could even agree on a "basic income" contract that solves inequality. These are all hypothetical examples, but I think this would be a worthwhile use of electricity. Especially if it's all cheap and renewable energy.
- gtrubetskoy 9y agoAnother aspect that is frequently overlooked is that keeping bitcoin requires no energy at all (literally you can write the key on a piece of paper), and a transfer (not considering the mining aspect) requires very little as well (it can be an SMS message). Contrast that with the all the office buildings (e.g. Manhattan) and computer systems required by banks, ongoing. The banking industry has google-size datacenters as well, they just don't like to talk about it. As well as the energy to print the paper/plastic cash and all the statements, etc. It is very difficult to estimate the true energy consumed by fiat, while bitcoin energy is in the hashrate, and that's pretty much it.
- 6d6b73 9y agoYou don't need banks to store cash. Bitcoin without electricity is useless, cash on the other hand is not.
- gtrubetskoy 9y agoBut you do need banks to store cash. And the bank better have a secure vault and security guards and cameras and all that. An elliptic curve key, which is what possession of bitcoin is, is just a large number. To send a bitcoin you need to create a "transaction", and in fact the only aspect of generating a bitcoin transaction that requires energy is the SHA calculation, not something you can do in pencil, the EC math is actually simple enough that a computer is not required. Also your argument that cash does not require energy does not apply to the cashless society we have become today, when was the last time you actually used cash? Credit cards are useless without electricity.
- 6d6b73 9y agoI have cash in my pocket. I'm not a bank. Therefore you don't need bank to store cash. Simple? And I use cash on a daily basis.. We're far from being the cashless society you claim we are.
- gtrubetskoy 9y ago
- 6d6b73 9y ago"Also, one can argue that Bitcoin actually saves energy. The world’s financial system requires many resources beyond the electricity to run servers." What a bunch of crap. Bitcoin also needs servers (i.e exchanges, uses computers, routers, switches etc. )
- phoyd 9y agodigiconomist has a more "realistic" estimate by including real world factors like cooling costs, the operation of older, but still profitable hardware etc. into their balance sheet. Their number is 32 TWh over the year (vs 9,6 TWh in the article above) https://digiconomist.net/bitcoin-energy-consumption#assumptions https://digiconomist.net/bitcoin-energy-consumption#assumpti... Also, their yearly estimate was only 26 TWh a month ago. If we project this into the next year, then we'll end with 130 TWh at the end of 2018 - or roughly 40% of what the UK consumes.
- Sujan 9y ago> It is also easy to make this number look very small: Most of these comparisons sounded pretty identical to the ones from the "If I had the intention to lobby for a ban of Bitcoin mining, I would use references like the one below" list to me.
- Mitchhhs 9y agoCan someone explain something to me: So people mine bitcoin, which is really just validating the transactions on the network, and they get paid in bitcoin for doing so. However, they will receive fewer and fewer bitcoin over time because of the fixed supply. At some point doesn't mining become unprofitable, causing the network to crash. And if the price drops doesn't this exacerbate this problem? Would love some clarity here.
- gear54rus 9y agoIn addition to mining new bitcoin, miners confirm transactions of existing bitcoin in the network. They get paid to do that as well (tx fee).
- detaro 9y agoThey also get the transaction fees as reward, and the difficulty (and thus cost) of mining adjusts down if progress on the chain slows down
- nathan_f77 9y ago> However, they will receive fewer and fewer bitcoin over time because of the fixed supply. At some point doesn't mining become unprofitable, causing the network to crash. This would actually cause the price of Bitcoin to increase, so that it keeps up with the cost of mining it. The miners won't sell their Bitcoin for less than the cost of electricity. At some point, large mining operations will run their own power stations, and they'll just run on solar / hydro / geothermal power. They might even sell any surplus energy. Other miners might start paying for their electricity with Bitcoin, so the price of electricity might become directly related to the cost of mining Bitcoin.
- UncleEntity 9y agoI think once the 21 million (or whatever, too lazy to look up the actual number) coins are produced the mining fee will adjust to compensate for the utility of verifying blocks. Probably won't be profitable to have a whole warehouse full of nodes but I'm sure there will still be folks willing to make a couple bucks to keep the network up and running.
- KnightOfWords 9y ago> It is also easy to make this number look very small: >The energy that Bitcoin consumes in a year would only last the U.S. for 19 hours. That doesn't sounds small to me, given the relative utility of 320 million people against that of Bitcoin.
- nate_robo 9y agoSlightly off topic but would it be an advantage to use a low energy miner such as a Raspberry Pi as a bitcoin miner, or would that just be a waste of time and yield fractions of a cent / a cent per day? Admittedly little knowledge on bitcoin mining
- OfficerGuac 9y agoBitcoin is usually mined through mid-to-high end graphics cards. People running a pool of 6-7 of these cards per machine are seeing diminishing returns, so using a Pi wouldn't cover the electricity needed to keep it running.
- symmetricsaurus 9y agoBitcoin is mined using ASICs, and not GPUs. But, it’s true that mining using a raspberry pi would not be very useful.
- hesdeadjim 9y agoBeyond the novelty of doing it? No, completely not worth it.
- nathan_f77 9y agoUnfortunately, it hasn't been possible to mine Bitcoins on a regular computer (even a powerful one) for many years. If your laptop joined a mining pool in 2014, you would have earned around $0.20 USD per week, and you would spend much more than that on electricity. It's some tiny fraction of a cent now.
- ballenf 9y agoWhy is energy consumption itself become a bad thing? I get greenhouse gas emissions being bad, but why make energy consumption itself a negative? Not to mention that "consuming" energy is somewhat a fiction: it's more so changing the entropy of a system. True consumption of energy, at the extreme, would imply sending energy into deep space (any direction other than the sun really) where it can never be recovered. Is the problem that such entropy changes usually (always?) result in at least some heat loss? And the the planet is warming, so heat itself is seen as a negative? To make my point a different way, if a mining rig were 100% solar and 100% efficient (both fantasy, of course), then it could consume unlimited solar energy with no ill effects. Thus basing our judgment on energy consumption instead of waste heat and energy source issues seems misguided. Is it just too complicating to discuss this in terms of CO2 emissions and waste heat, instead of Watts alone?
- ResearchAtPlay 9y agoEvery form of electricity production consumes an array of limited natural resources. Wind and solar power don't have no direct CO2 emissions, but minerals need to be mined, plenty of clean water is consumed during manufacturing, and wildlife habitats are impacted by land-use change (wind and solar plants have a comparatively larger land footprint than fossil fuel plants). Fun Fact: The article says Bitcoin mining consumes ~1.1 GW of power. There is currently a massive political struggle over the construction of "Site C", a 1.1 GW Hydroelectric dam in British Columbia, Canada. Construction on that dam began last year, but public opposition caused a new provincial government to review the dam construction. The dam will flood 93 square kilometers of land but produce 5.1 GWh of low-carbon electricity annually, about 53% of the articles assumed Bitcoin mining consumption of 9.6 GWh (which is = 1.1 GW x 8760 hours/year). Whether construction of the dam will be cancelled or resumed, the decision will be controversial! (The decision will be announced before the end of the year). In summary, bitcoin mining from renewable energy sources is desirable, but bitcoin mining (and all other forms of computing) will always have some negative impact. That is something we need to be aware of.
- em3rgent0rdr 9y agoExactly. I feel that all these people complaining about bitcoin contributing to global warming would be better off focusing on implementing a global carbon tax (or cap'n'trade). That way the specific problem of greenhouse gasses gets addressed, while not interfering with the market.
- matt_wulfeck 9y agoWhen a handful of people control 40% of your market: it’s not decentralized. When you consume more energy than your house does over 1 week to make a single transaction: it’s not efficient. When it takes hours or days to settle: it’s not fast. So what is bitcoin, anyway? From what I can tell a way for people to get rich.
- OhDagny 9y agoWe need to end mining by forcing the protocol owners to do a difficulty jump that will make mining pointless for 10 years.(guesstimate)
- patsmith 9y agoTake your best guess when Bitcoin will fall of the cliff: https://twitter.com/BitcoinPlunge https://twitter.com/BitcoinPlunge
- em3rgent0rdr 9y agoCan also utilize the waste heat...by selling a miner as a "heater that makes money".