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'Bitcoin is the product of hashpower. The industry wouldn’t exist without incentivizing miners to continuously invest in hardware and burning electricity to aug
by trixie_ 6y ago
'Bitcoin is the product of hashpower. The industry wouldn’t exist without incentivizing miners to continuously invest in hardware and burning electricity to augment Bitcoin network’s settlement assurance'
I think this is a common misconception. People don't need to continually invest in mining hardware to keep it going. The entire Bitcoin network could technically be run off a single Rasberry Pi. The network hash rate is only so high because the ROI is there, but without it, people would still be mining.
Case in point, there are plenty of long forgotten altcoins out there that people are mining just for fun. At the end of the day your computer is no different from an expensive space heater. Might as well mine some crypto with it.
- season2episode3 6y ago> At the end of the day your computer is no different from an expensive space heater. Might as well mine some crypto with it. Or, you know, you could just turn the computer off while you're not actively using it. It saves you money and does a small little good thing for the environment too.
- trixie_ 6y agoThat is why I made the analogy to a space heater - because mining would be a free side benefit of something you actively use to keep warm. The environmental impact is also negligible if the power you're using is coming from solar or wind.
- Klinky 6y agoAn idle computer clocks down and sips power. Going full bore mining coins results in significant power usage increases. We're talking 10 watts vs 100s of watts.
- trixie_ 6y agoSmall space heaters run at 750 watts on the low setting.
- qes 6y agoA single Bitcoin miner runs at 1500w on its only setting and sounds like a small aircraft preparing for takeoff.
- beervirus 6y agoThat matters if you live in Texas. It doesn't matter if you live above the Arctic Circle.
- thebean11 6y agoRight but if your goal is to heat your apartment (and your alternative heat source is also electric) running the computer is a pretty efficient heat source.
- contravariant 6y agoWell, efficient is hardly the right phrase. When it comes to heating using electricity then 100% efficiency is on the low side. A heat pump could be many times more efficient.
- lalaland1125 6y agoI just also want to add that gas heating is also effectively >100% efficient relative to electricity because there are no losses incurred on the power generation side.
- a1369209993 6y agoThat depends on how you're making that gas. IIRC algae (the primary ingredient in most fossile fuels) are less than 10% efficient at converting sunlight into chemical energy after metabolic expenditures. (There's also the part where the sun is <<0.00001% efficent at turning fusion energy into sunlight-that-hits-earth, but that problem isn't specific to gas heating.)
- londons_explore 6y agoIt is sad that "heat" and "efficiency" are defined like this... "100% efficiency" should be the Carnot's theorem efficiency limit...
- vzzvzsz 6y agoefficient
- perl4ever 6y agoWhat people say is that all electric heat is equally efficient in the sense that all the delivered watts ultimately become heat, but at least in the general area where I live, electric heat of any kind is not efficient in the sense that it is significantly more expensive than burning fuel (natural gas, oil, etc.) at home.
- CalmStorm 6y agoThe other common misconception is that the price of bitcoin is determined by the hashrate. It is actually the other way around, a higher price drives up the hashrate, because a higher price means more demand for bitcoin. Some founders of altcoins apparently don't understand this and try to buy hashpower to artificially increase the hashrate, hoping to increase the price of their coins. If there is no demand for their coins, an ASIC farm is no different from a Rasberry Pi.
- srl 6y agoWait... isn't it worse than that? If I buy enough hashpower to have a measurable effect on the price, shouldn't the price be driven down, by the increased supply? Thus an ASIC farm is worse than a raspberry pi, at least as far as the effect on price goes. (But, isn't there some majority attack? So maybe I want an ASIC farm as a way to protect my investment...)
- jes5199 6y agono, the mining difficulty self-adjusts, so the supply is only increased for a very brief time
- kcolford 6y agoNo because the supply is fixed in time
- garmaine 6y agoThe supply is fixed in number of blocks, not time.
- trixie_ 6y agoSupply of what? The supply increase of coins is constant regardless of the hashrate. This is exactly why there was no effect on bitcoin price when the reward rate halved. The value of the coin drives mining behavior, not the other way around.
- 6y ago
- vmception 6y agoThe image of people mining in their residences is the furthest from the truth about crypto mining. It uses primarily renewable resources or is repurposing pollution directly. This is the only economical way to mine. The vast majority of mining power is done this way, upwards of 80%. How much energy is being used is a purposeful misdirection.
- srib 6y agoThat argument, unfortunately, is a slippery slope. One could list a gazillion things that are good for the environment. The environment argument against Bitcoin has been thoroughly debunked. There are several valid points of criticism against Bitcoin. I wish more effort is put into it to criticize it along those fronts.
- redis_mlc 6y ago> The environment argument against Bitcoin has been thoroughly debunked. Nonsense, every bitcoin mined is unnecessary for the environment.
- deleted 6y ago[deleted]
- brian_cloutier 6y agoI haven't read the article, but I believe it will say something like, the continual investment is necessary in order for the transactions to be irreversible (settlement assurance). I'm sure there are some forgotten altcoins out there still chugging along, but it probably does not take much money to hire sufficient hash power to double-spend those alts, or even re-write their history. For as long as bitcoin miners fight, tooth and nail, to hash incrementally more efficiently than their competitors, it will be prohibitively expensive for most actors to reverse transactions.
- trixie_ 6y agoNot saying this isn't a possibility, but you'd think in the last 5 years of thousands of altcoins this sort of thing must of happened at least once? I guess the interest has to be there to attack it? Though if the interest was there more people would be mining it. Something like that.
- brian_cloutier 6y agoIt... has happened. Multiple times. Bitcoin Gold: https://cointelegraph.com/news/bitcoin-gold-blockchain-hit-by-51-attack-leading-to-70k-double-spend https://cointelegraph.com/news/bitcoin-gold-blockchain-hit-b... Vertcoin: https://www.coindesk.com/the-vertcoin-cryptocurrency-just-got-51-attacked-again https://www.coindesk.com/the-vertcoin-cryptocurrency-just-go... Ethereum Classic: https://cointelegraph.com/news/ethereum-classic-51-attack-the-reality-of-proof-of-work https://cointelegraph.com/news/ethereum-classic-51-attack-th... Google is happy to show you more.
- uryga 6y ago> At the end of the day your computer is no different from an expensive space heater. Might as well mine some crypto with it. i mean... it wouldn't be a space heater if it wasn't crunching pointless numbers...
- mindcandy 6y agoThe point of the numbers is to prove that you heated space. Seriously. It proves that you burned value that you know you are not getting back if you are caught falsifying records for the system. And, everyone knows its extremely hard to not get caught if you try. Therefore you can be trusted to sign records for the system because you are risk:reward tremendously more financially motivated to be a good actor than a bad one --including whatever nefarious scenarios you might imagine.
- uryga 6y agoi understand the idea of proof-of-work. but idk, when i think about all that electricity and computing power wasted on guessing arbitrary numbers... just doesn't feel right kind of reminds me of how FAANG job interviews require memorizing not-very-useful algo stuff to weed out people who "aren't motivated enough" to study that stuff for the interview¹... "proof-of-motivation" if you will. it serves a purpose, but requires "burning" a lot of ultimately pointless effort --- 1. at least that's what people say about them, never interviewed there myself
- perl4ever 6y ago"Pointless" only matters if it is "a lot" and "a lot" is relative. It seems like it has not been possible to resolve the question of whether the effort is necessary. If you suggest that existing monetary systems have orders of magnitude lower overhead, particularly fiat money, then people will argue that all sorts of costs are hidden. But I don't believe it makes up the difference, and I attribute peoples' willingness to believe it to the assumption/belief that anything that virally spreads cannot be drastically worse (in some dimension).
- lukifer 6y ago
- hn_acc_2 6y agoI think you're missing the point. For Bitcoin to continue to act as a decentralized currency ledger (with "settlement assurance"), then the network hash rate must remain high. Nobody is arguing that the code couldn't run on one processor, only that cryptocurrencies conceptually depend on this high hash rate
- trixie_ 6y agoIt doesn't 'have' to be high. The hash rate could be 1/1000 of what it is today without any risk to 'settlement assurance'
- hn_acc_2 6y agohttps://www.crypto51.app/coins/BTC.html https://www.crypto51.app/coins/BTC.html You could pay $384k to hire miners to 51% attack BTC right now (that is, if NiceHash had the capacity). If you cut the hash rate that much the cost would be only $400 or so. Does it sound like a secure trustless currency if anyone can pay $400 to gain 51% majority? EDIT: 51% attack != rewrite blockchain
- trixie_ 6y agoThere's a big difference between rewriting all history and rewriting a portion of it during an attack which costs 400k per hour. Also people may misinterpret 'rewriting history' as the ability to to change coins sent from A -> B to A -> C. Which it is not. Not saying an attack still isn't bad, but let's be clear what the extent of the damage could and could not be.
- a1369209993 6y ago1: It's actually, under your proposal, "rewriting a portion of [history] during an attack which costs 400 [not 400 thousand] [dollars] per hour". 2: If you are A (and regardless of whether you're also C) and you sent money to B during the 400$/hr (less than a high-profile lawyer, and probably faster to boot) attack, then yes, changing coins sent from A -> B to A -> C is exactly what you can do.
- TylerE 6y ago> At the end of the day your computer is no different from an expensive space heater In most of the US, at least, you want AC and not heat at least 7-8 months out of the year, if not more.
- gridlockd 6y agoIn order to maintain network stability at current prices of Bitcoin, a massive amount of hashrate is required. Those altcoins that have become worthless and are mined "just for fun" are only protected by the fact that they are worthless. Any attack would be a waste of resources. You could still attack them "just for fun" of course...
- trixie_ 6y agoNot really. They are cemented into those blockchains. Unless you have a way to back write a blockchain.
- thebean11 6y agoThat's kind of the point, you can back write a block chain with enough hash power. Just go back a few hundred blocks in the chain, and "fork" into an alternate chain. If your chain can catch up and become longer, you win. This happens on a micro scale every day, when two people "solve" the next block at the same time. Inevitably, one of those forked chains gets longer and the other one is abandoned or "orphaned".
- tdhttt 6y ago> The network hash rate is only so high because the ROI is there, but without it, people would still be mining. Can you expand on that? What would be the incentive for the miners then? What happens when all blocks are mined?
- trixie_ 6y agoYou never mine all the blocks, and regardless of the reward there is always a transaction fee which incentives mining. Regardless though my point about space heaters was that 'being warm' is enough incentive for some people to mine crypto.
- tdhttt 6y agoSorry for not being clear, I meant when all 21 million bitcoins are mined. The transaction fee is pretty small compared to the reward from the new coin, right? Also, since many cryptos have addressed the incentive issue. Maybe let's just focus on bitcoin specifically?
- rodonn 6y agoIf ROI goes down, fewer miners will mine. When all blocks are mined, transaction fees will be the main source of incentive to mine.
- perl4ever 6y agoIt's been a long, long time since your computer drew the same power independent of processing load.
- nullc 6y ago> The entire Bitcoin network could technically be run off a single Rasberry Pi. Pedantically, a rpi wouldn't meet the target interblock time because of minimum difficulty. But a system using a single 2014 era 800w shoebox sized mining device could meet minimum difficulty on its own.
- roenxi 6y ago> The entire Bitcoin network could technically be run off a single Rasberry Pi. But can that be done practically? At some point you lose the ability to tell which of the forks is 'Bitcoin' and which are 'pretender' altcoins. I can imagine a future where you run a chain for 6 months on a Pi then someone turns up with an ASIC and writes a new 6 month history and calls it Bitcoin instead. The risks of shenanigans would be huge.
- ramblerman 6y ago> The entire Bitcoin network could technically be run off a single Rasberry Pi. The network hash rate is only so high because the ROI is there, but without it, people would still be mining. That's a bit of a naive view. It's like saying, we don't need this expensive security vault in our bank, we could just store it all in a shed. the proof of work is crucial to the proper functioning of bitcoin, and if the only miners were running on a raspberry pie anyone could come along and do a >50% attack stealing what they want.
- jayd16 6y agoDoesn't the hashrate need to stay high for security reasons? If miner participation is low, can't bad actors dominate the system and produce false transaction? If the hashrate ever collapses isn't the whole system at risk?
- spyder 6y agoAnd there are altcoins without mining.
- kevingadd 6y ago> At the end of the day your computer is no different from an expensive space heater This has been false for probably a decade or more. Pretty much any modern processor has dramatically lower power consumption when not under load through a combination of things like clock adjustment, powering off cores, and even dynamically adjusting voltage. This is part of why smartphones have battery life measured in dozens of hours instead of 1-4 hours.