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In the US, the financial system is about 10% of GDP. (The number depends on your definitions of financial system, US, GDP, and "is"). It also consumes vast amou

by tlb 9y ago

In the US, the financial system is about 10% of GDP. (The number depends on your definitions of financial system, US, GDP, and "is"). It also consumes vast amounts of resources ranging from gasoline to drive mortgage brokers to and from work, to the cost of mailing out free low-introductory rate credit cards. It's a fair criticism of Bitcoin that it uses a lot of energy, but it's hard to predict whether it will ultimately use more or less than the existing system as a percentage of value created.

jraines 9y ago
mortgage & credit generally are bad comparisons, because cryptocurrency doesn't solve this. You still need a credit score or similar reputation metric associated with your real legal name/entity. In general I agree, though. Turning energy into trust is definitely worth it, and we're in a price discovery phase to find out what "it" is.
- fastball 9y ago
  Bitcoin doesn't solve this, but there are plenty[1][2][3][4] of cryptos that realize this failing in Bitcoin and others and are trying to address it. 1. https://www.civic.com/ https://www.civic.com/ 2. https://stratisplatform.com/identity/ https://stratisplatform.com/identity/ 3. https://whycardano.com/#social-elements-of-money https://whycardano.com/#social-elements-of-money 4. https://neo.org/ https://neo.org/
ecuzzillo 9y ago
Is there some evidence that it would actually replace any of the existing financial system, rather than just adding yet another venue for speculation and manipulation?
foepys 9y ago
I will repost a comment of mine from another Bitcoin thread about a month ago regarding this comparison because the comparison is just ridiculous: Bitcoin is estimated to use about the same energy as the whole country of Denmark[1]. Denmark has over 790 million cashless transactions with "Dankort", a local debit card, per year alone[2] - excluding other payment methods. Bitcoin can handle about 2,000 transactions per block[3]. 2,000 transactions times 6 blocks per hour times 24 hours in a day times 365 days in a year equals 105,120,000 transactions per year. Congratulations, you just used the energy of the whole country of Denmark with _everything_ in it (housholds, heavy industry, etc.) to process less than a 1/7th of Denmark's cash-less transactions with a _specific_ (albeit widely used) debit card. You see, your argument is simply invalid. "Traditional" banking is more energy efficient by multiple orders of magnitude. 1: https://arstechnica.com/tech-policy/2017/12/bitcoins-insane-energy-consumption-explained/ https://arstechnica.com/tech-policy/2017/12/bitcoins-insane-... 2: https://www.nationalbanken.dk/en/publications/Documents/2011/09/MON3Q_P1_2011_Payment%20Habits%20in%20Denmark.pdf https://www.nationalbanken.dk/en/publications/Documents/2011... (page 125) 3: https://blockchain.info/en/charts/n-transactions-per-block https://blockchain.info/en/charts/n-transactions-per-block

by tlb 9y ago

jraines 9y ago

mortgage & credit generally are bad comparisons, because cryptocurrency doesn't solve this. You still need a credit score or similar reputation metric associated with your real legal name/entity. In general I agree, though. Turning energy into trust is definitely worth it, and we're in a price discovery phase to find out what "it" is.

fastball 9y ago
Bitcoin doesn't solve this, but there are plenty[1][2][3][4] of cryptos that realize this failing in Bitcoin and others and are trying to address it. 1. https://www.civic.com/ https://www.civic.com/ 2. https://stratisplatform.com/identity/ https://stratisplatform.com/identity/ 3. https://whycardano.com/#social-elements-of-money https://whycardano.com/#social-elements-of-money 4. https://neo.org/ https://neo.org/

ecuzzillo 9y ago

Is there some evidence that it would actually replace any of the existing financial system, rather than just adding yet another venue for speculation and manipulation?

foepys 9y ago

I will repost a comment of mine from another Bitcoin thread about a month ago regarding this comparison because the comparison is just ridiculous: Bitcoin is estimated to use about the same energy as the whole country of Denmark[1]. Denmark has over 790 million cashless transactions with "Dankort", a local debit card, per year alone[2] - excluding other payment methods. Bitcoin can handle about 2,000 transactions per block[3]. 2,000 transactions times 6 blocks per hour times 24 hours in a day times 365 days in a year equals 105,120,000 transactions per year. Congratulations, you just used the energy of the whole country of Denmark with _everything_ in it (housholds, heavy industry, etc.) to process less than a 1/7th of Denmark's cash-less transactions with a _specific_ (albeit widely used) debit card. You see, your argument is simply invalid. "Traditional" banking is more energy efficient by multiple orders of magnitude. 1: https://arstechnica.com/tech-policy/2017/12/bitcoins-insane-energy-consumption-explained/ https://arstechnica.com/tech-policy/2017/12/bitcoins-insane-... 2: https://www.nationalbanken.dk/en/publications/Documents/2011/09/MON3Q_P1_2011_Payment%20Habits%20in%20Denmark.pdf https://www.nationalbanken.dk/en/publications/Documents/2011... (page 125) 3: https://blockchain.info/en/charts/n-transactions-per-block https://blockchain.info/en/charts/n-transactions-per-block