6 ms·

I am personally of the opinion that China swiftly killing off its cryptocurrency mining industry overnight would be to the great benefit of humanity. The sheer

I am personally of the opinion that China swiftly killing off its cryptocurrency mining industry overnight would be to the great benefit of humanity. The sheer amount of electricity it wastes is an environmental disaster.

vadimberman 9y ago
Let alone the psychological damage to the society that any kind of speculation and a flood of "get-rich-fast" schemes incur. Strict measures are not always bad. If China did not handle the SARS epidemic years ago the way they did, things could have been more similar to the Ebola epidemic.
- makomk 9y ago
  The likely reason Bitcoin has been taking off in China is because the available traditional investing options for people there are terrible as a result of government meddling. In particular, the whole country's economy is in the middle of a terrifying debt-fuelled bubble in which bank lending has effectively become an arm of the state, leading to a rather terrifying debt-to-GDP ratio and a banking system that may well collapse the moment the growth pauses. Combine that with increasingly strict capital controls that restrict the ability of most people to invest their money outside of China and a lack of trust in the government not to seize less favoured people's businesses for the benefit of insiders, and you have a strong recipe for Bitcoin popularity.
tbabb 9y ago
Agreed. Shutting down participation in the planet's largest pyramid scheme doesn't have a lot of downside.
- isoprophlex 9y ago
  Can't agree more. Also I am getting pretty sick of the impact crypto trading is having on office conversations. All I hear these days are inane conversations about getting rich quick. Everyone is an expert in technical analysis these days. At best, trading these currencies is a zero-sum game where you take money from others without providing any intrinsic worth to humanity. At worst is a pyramid scheme plain and simple.
  - llamataboot 9y ago
    Naysayers would point out that trading increases liquidity which ostensibly increases the ability of a market to parlay information into value. But I'd be likely to agree with you. While blockchain technology /does/ have a future and will enable forms of socio-economic organization that were previously impossible, it's not there yet, and at the moment we're mostly passing tulips off to the greater fool.
    - BoiledCabbage 9y ago
      > Naysayers would point out that trading increases liquidity which ostensibly increases the ability of a market to parlay information into value. And increasing opioid supplies, increases the ability of the market to efficiently parlay money into an altered mental state. Doesn't mean it's a net positive for society. The "liquidity" argument is such a terrible and simplistic justification for so many things.
      - oxide 9y ago
        Trust me, those opioids would be just as easy to acquire with Amazon Gift Cards, Paypal, Western Union, a bank deposit, you name it pal. If you're trying to stand on some kind of anti-opiate moral ground for why cryptocurrency is evil it's a poor hill to die on.
    - walrus1066 9y ago
      'at the moment we're mostly passing tulips off to the greater fool.' At least tulips have some intrinsic value, I.e. They can be quite pretty!
  - baddox 9y ago
    I have no problem with valid criticism of cryptocurrency, and especially of its fanatics, but I’d be curious to hear you back up your claim that at best it’s a zero-sum game. That seems to me to be clearly incorrect.
    - 9y ago
- secfirstmd 9y ago
  Couldnt agree more. All that wasted energy and carbon for nothing. All that power that could have been used for something useful like gene folding or SETI.
- olalonde 9y ago
  Here is what a pyramid scheme is: https://en.wikipedia.org/wiki/Pyramid_scheme https://en.wikipedia.org/wiki/Pyramid_scheme Bitcoin is a distributed database that solves the "Two Generals Problem". Please don't spread misinformation on things you do not understand.
  - ocb 9y ago
    Could you clarify why those things are mutually exclusive? And to be clear: I don't know how to feel about Bitcoin and the attention it has received lately.
    - olalonde 9y ago
      There's just nothing about the definition of a pyramid scheme that applies to Bitcoin, not even close. There's no organisation, recruiting, directors, membership or promise of payments. It doesn't have to grow forever. It's not illegal. The amount of ignorant Bitcoin comments on HN is just baffling.
      - aaron-lebo 9y ago
        It's a very uncharitable definition, sure. There's no organisation, recruiting, directors, membership or promise of payments. But those definitely exist, just not via any singular organization. There very much is organization and organizations, recruiting, would be directors, unofficial membership in the club of ownership, and lots of promises of payments. When people make that comparison, what they're really saying is Bitcoin is mostly funny money which above all else has enriched early adopters and will probably lose a lot of late adopters lots of money. It's ceased to even be a useful currency. You don't have to squint very hard to see the comparison, even if it isn't flattering or technically the same thing as a pyramid scheme. This is from your link: In a pyramid scheme [Bitcoin], an organization compels individuals who wish to join to make a payment [purchase Bitcoin]. In exchange, the organization promises its new members a share of the money taken from every additional member that they recruit [to the moon]. The directors of the organization (those at the top of the pyramid) also receive a share of these payments. For the directors, the scheme is potentially lucrative—whether or not they do any work, the organization's membership has a strong incentive to continue recruiting and funneling money to the top of the pyramid. Such organizations seldom involve sales of products or services with value. Without creating any goods or services, the only revenue streams for the scheme are recruiting more members or soliciting more money from current members. The behavior of pyramid schemes follows the mathematics concerning exponential growth quite closely. Each level of the pyramid is much larger than the one before it. For a pyramid scheme to make money for everyone who enrolls in it, it would have to expand indefinitely. This is not possible because the population of Earth is finite. When the scheme inevitably runs out of new recruits, lacking other sources of revenue, it collapses. Because in a geometric series, the biggest terms are at the end, most people will be in the lower levels of the pyramid (and indeed the bottom level is always the biggest single layer). In a pyramid scheme, people in the upper layers typically profit while people in the lower layers typically lose money. Since at any given time, most of the members in the scheme are at the bottom, most participants in a pyramid scheme will not make any money. In particular, when the scheme collapses, most members will be in the bottom layers and thus will not have any opportunity to profit from the scheme, yet they will have paid to join the scheme. Therefore, a pyramid scheme is characterized by a few people (including the creators of the scheme) making large amounts of money, while most who join the scheme lose money. For this reason, they are considered scams.[2] Sounds like many cryptocurrencies and Bitcoin is approaching that if it hasn't hit it already.
- lifeisunfair 9y ago
  I just feel sorry about all the people that lost or will lose money on it. It is our(techies) job to protect them, and we are failing miserably.
- dang 9y ago
  You started a flamewar with this low-quality dismissal. Although I'm sure you didn't mean to, in effect this is vandalism. Please post more thoughtfully to HN. Here is a relevant site guideline: * Comments should get more civil and substantive, not less, as a topic gets more divisive.* https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html
tanilama 9y ago
Agreed, China's excessive state power can be at least of good use for this case.
mathattack 9y ago
Yes. What's it do to the price of Bitcoin though?
randyrand 9y ago
China getting out of Bitcoin would probably help the currency long term IMO.
bamboozled 9y ago
I don't get winging about mining crypto currency and "wasting power", it's not really a waste, it's proof of work. Besides, we humans waste energy on way worse things than mining Bitcoin. What about running Facebook, the tens of thousands of high end servers running globally just to figure out what useless junk to feed people, in a way that is detrimental to their health. I don't hear many people complaining about that side of it personally and it's a way bigger waste of electricity IMO. The other issue is the fact that electricity is produced using fossil fuels, again, not enough protesting about that issue.
- mehrdadn 9y ago
  > it's not really a waste, it's proof of work Every kind of waste I can think of is a proof of some kind of work. That doesn't make it a good thing.
  - bamboozled 9y ago
    The value provide by these systems is trust, which literally requires proof of work to establish. Facebook news feeds don't require proof of work in the same sense.
    - Nursie 9y ago
      That's not a requirement for trust. It's a requirement for this particular kind of decentralised trust.
    - mehrdadn 9y ago
      > The value provide by these systems is trust, which literally requires proof of work to establish. This is going to go on a tangent but I do not see why proof of work has anything to do with trust. Does your trust in me increase somehow if I give you a string whose hash ends in twenty zeros? i.e. if I subsequently told you I had found a number whose hash ended in thirty zeros but didn't give you the number, would you somehow trust me more than someone else who hadn't shown you proof of work for twenty zeros? Not really. If anything, proof of work is not producing trust, but eliminating it (and the need for it).
jrsks 9y ago
Many newer cryptocurrencies use Proof of Stake vs. Proof of Work. PoS is much more efficient than PoW. https://ethereum.stackexchange.com/questions/118/whats-the-difference-between-proof-of-stake-and-proof-of-work/141#141 https://ethereum.stackexchange.com/questions/118/whats-the-d... So if electricity is the only reason to combat Bitcoin, many other cryptocurrencies should be fine.
jpatokal 9y ago
As long as there's money to be made, which there undoubtedly is (right now), Bitcoin mining will just move somewhere else. Also, as the Chinese proverb says, the mountains are high and the emperor is far away. Liberal use of the death penalty hasn't solved China's drug problem, a few Politburo decrees aren't going to stop China's Bitcoin mining.
koonsolo 9y ago
I am personally of the opinion that cryptocurrency swiftly killing off the (central) banking industry would be to the great benefit of humanity. The sheer amount of electricity, human energy, infrastructure, material and real estate it wastes is an environmental disaster.
- bamboozled 9y ago
  100% agree with this, imagine the carbon foot print of all current financial institutions combined.
  - mcv 9y ago
    I have no idea, actually. But bitcoin consumes more energy than a small country (Denmark, I think?), which is quite a lot, yet it's much less useful than all current financial institutions combined. I'm all for shrinking the carbon footprint (or social footprint, even) of banks and other institutions, but I don't think bitcoin can do that.

vadimberman 9y ago

Let alone the psychological damage to the society that any kind of speculation and a flood of "get-rich-fast" schemes incur. Strict measures are not always bad. If China did not handle the SARS epidemic years ago the way they did, things could have been more similar to the Ebola epidemic.

makomk 9y ago
The likely reason Bitcoin has been taking off in China is because the available traditional investing options for people there are terrible as a result of government meddling. In particular, the whole country's economy is in the middle of a terrifying debt-fuelled bubble in which bank lending has effectively become an arm of the state, leading to a rather terrifying debt-to-GDP ratio and a banking system that may well collapse the moment the growth pauses. Combine that with increasingly strict capital controls that restrict the ability of most people to invest their money outside of China and a lack of trust in the government not to seize less favoured people's businesses for the benefit of insiders, and you have a strong recipe for Bitcoin popularity.

tbabb 9y ago

Agreed. Shutting down participation in the planet's largest pyramid scheme doesn't have a lot of downside.

isoprophlex 9y ago
Can't agree more. Also I am getting pretty sick of the impact crypto trading is having on office conversations. All I hear these days are inane conversations about getting rich quick. Everyone is an expert in technical analysis these days. At best, trading these currencies is a zero-sum game where you take money from others without providing any intrinsic worth to humanity. At worst is a pyramid scheme plain and simple.
- llamataboot 9y ago
  Naysayers would point out that trading increases liquidity which ostensibly increases the ability of a market to parlay information into value. But I'd be likely to agree with you. While blockchain technology /does/ have a future and will enable forms of socio-economic organization that were previously impossible, it's not there yet, and at the moment we're mostly passing tulips off to the greater fool.
  - BoiledCabbage 9y ago
    > Naysayers would point out that trading increases liquidity which ostensibly increases the ability of a market to parlay information into value. And increasing opioid supplies, increases the ability of the market to efficiently parlay money into an altered mental state. Doesn't mean it's a net positive for society. The "liquidity" argument is such a terrible and simplistic justification for so many things.
    - oxide 9y ago
      Trust me, those opioids would be just as easy to acquire with Amazon Gift Cards, Paypal, Western Union, a bank deposit, you name it pal. If you're trying to stand on some kind of anti-opiate moral ground for why cryptocurrency is evil it's a poor hill to die on.
  - walrus1066 9y ago
    'at the moment we're mostly passing tulips off to the greater fool.' At least tulips have some intrinsic value, I.e. They can be quite pretty!
- baddox 9y ago
  I have no problem with valid criticism of cryptocurrency, and especially of its fanatics, but I’d be curious to hear you back up your claim that at best it’s a zero-sum game. That seems to me to be clearly incorrect.
  - 9y ago
secfirstmd 9y ago
Couldnt agree more. All that wasted energy and carbon for nothing. All that power that could have been used for something useful like gene folding or SETI.
olalonde 9y ago
Here is what a pyramid scheme is: https://en.wikipedia.org/wiki/Pyramid_scheme https://en.wikipedia.org/wiki/Pyramid_scheme Bitcoin is a distributed database that solves the "Two Generals Problem". Please don't spread misinformation on things you do not understand.
- ocb 9y ago
  Could you clarify why those things are mutually exclusive? And to be clear: I don't know how to feel about Bitcoin and the attention it has received lately.
  - olalonde 9y ago
    There's just nothing about the definition of a pyramid scheme that applies to Bitcoin, not even close. There's no organisation, recruiting, directors, membership or promise of payments. It doesn't have to grow forever. It's not illegal. The amount of ignorant Bitcoin comments on HN is just baffling.
    - aaron-lebo 9y ago
      It's a very uncharitable definition, sure. There's no organisation, recruiting, directors, membership or promise of payments. But those definitely exist, just not via any singular organization. There very much is organization and organizations, recruiting, would be directors, unofficial membership in the club of ownership, and lots of promises of payments. When people make that comparison, what they're really saying is Bitcoin is mostly funny money which above all else has enriched early adopters and will probably lose a lot of late adopters lots of money. It's ceased to even be a useful currency. You don't have to squint very hard to see the comparison, even if it isn't flattering or technically the same thing as a pyramid scheme. This is from your link: In a pyramid scheme [Bitcoin], an organization compels individuals who wish to join to make a payment [purchase Bitcoin]. In exchange, the organization promises its new members a share of the money taken from every additional member that they recruit [to the moon]. The directors of the organization (those at the top of the pyramid) also receive a share of these payments. For the directors, the scheme is potentially lucrative—whether or not they do any work, the organization's membership has a strong incentive to continue recruiting and funneling money to the top of the pyramid. Such organizations seldom involve sales of products or services with value. Without creating any goods or services, the only revenue streams for the scheme are recruiting more members or soliciting more money from current members. The behavior of pyramid schemes follows the mathematics concerning exponential growth quite closely. Each level of the pyramid is much larger than the one before it. For a pyramid scheme to make money for everyone who enrolls in it, it would have to expand indefinitely. This is not possible because the population of Earth is finite. When the scheme inevitably runs out of new recruits, lacking other sources of revenue, it collapses. Because in a geometric series, the biggest terms are at the end, most people will be in the lower levels of the pyramid (and indeed the bottom level is always the biggest single layer). In a pyramid scheme, people in the upper layers typically profit while people in the lower layers typically lose money. Since at any given time, most of the members in the scheme are at the bottom, most participants in a pyramid scheme will not make any money. In particular, when the scheme collapses, most members will be in the bottom layers and thus will not have any opportunity to profit from the scheme, yet they will have paid to join the scheme. Therefore, a pyramid scheme is characterized by a few people (including the creators of the scheme) making large amounts of money, while most who join the scheme lose money. For this reason, they are considered scams.[2] Sounds like many cryptocurrencies and Bitcoin is approaching that if it hasn't hit it already.
lifeisunfair 9y ago
I just feel sorry about all the people that lost or will lose money on it. It is our(techies) job to protect them, and we are failing miserably.
dang 9y ago
You started a flamewar with this low-quality dismissal. Although I'm sure you didn't mean to, in effect this is vandalism. Please post more thoughtfully to HN. Here is a relevant site guideline: * Comments should get more civil and substantive, not less, as a topic gets more divisive.* https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html

tanilama 9y ago

Agreed, China's excessive state power can be at least of good use for this case.

mathattack 9y ago

Yes. What's it do to the price of Bitcoin though?

randyrand 9y ago

China getting out of Bitcoin would probably help the currency long term IMO.

bamboozled 9y ago

I don't get winging about mining crypto currency and "wasting power", it's not really a waste, it's proof of work. Besides, we humans waste energy on way worse things than mining Bitcoin. What about running Facebook, the tens of thousands of high end servers running globally just to figure out what useless junk to feed people, in a way that is detrimental to their health. I don't hear many people complaining about that side of it personally and it's a way bigger waste of electricity IMO. The other issue is the fact that electricity is produced using fossil fuels, again, not enough protesting about that issue.

mehrdadn 9y ago
> it's not really a waste, it's proof of work Every kind of waste I can think of is a proof of some kind of work. That doesn't make it a good thing.
- bamboozled 9y ago
  The value provide by these systems is trust, which literally requires proof of work to establish. Facebook news feeds don't require proof of work in the same sense.
  - Nursie 9y ago
    That's not a requirement for trust. It's a requirement for this particular kind of decentralised trust.
  - mehrdadn 9y ago
    > The value provide by these systems is trust, which literally requires proof of work to establish. This is going to go on a tangent but I do not see why proof of work has anything to do with trust. Does your trust in me increase somehow if I give you a string whose hash ends in twenty zeros? i.e. if I subsequently told you I had found a number whose hash ended in thirty zeros but didn't give you the number, would you somehow trust me more than someone else who hadn't shown you proof of work for twenty zeros? Not really. If anything, proof of work is not producing trust, but eliminating it (and the need for it).

jrsks 9y ago

Many newer cryptocurrencies use Proof of Stake vs. Proof of Work. PoS is much more efficient than PoW. https://ethereum.stackexchange.com/questions/118/whats-the-difference-between-proof-of-stake-and-proof-of-work/141#141 https://ethereum.stackexchange.com/questions/118/whats-the-d... So if electricity is the only reason to combat Bitcoin, many other cryptocurrencies should be fine.

jpatokal 9y ago

As long as there's money to be made, which there undoubtedly is (right now), Bitcoin mining will just move somewhere else. Also, as the Chinese proverb says, the mountains are high and the emperor is far away. Liberal use of the death penalty hasn't solved China's drug problem, a few Politburo decrees aren't going to stop China's Bitcoin mining.

koonsolo 9y ago

I am personally of the opinion that cryptocurrency swiftly killing off the (central) banking industry would be to the great benefit of humanity. The sheer amount of electricity, human energy, infrastructure, material and real estate it wastes is an environmental disaster.

bamboozled 9y ago
100% agree with this, imagine the carbon foot print of all current financial institutions combined.
- mcv 9y ago
  I have no idea, actually. But bitcoin consumes more energy than a small country (Denmark, I think?), which is quite a lot, yet it's much less useful than all current financial institutions combined. I'm all for shrinking the carbon footprint (or social footprint, even) of banks and other institutions, but I don't think bitcoin can do that.