42 ms·

Bitcoin breaks above $20k

272 points by wsieroci 6y ago

tectonic 6y ago
What's the carbon footprint of BTC like these days? Has any progress been made on mitigating this fundamental design issue?
- robert_foss 6y ago
  Yes, but not with Bitcoin. Etherium is currently moving from Proof-of-Work to Proof-of-Stake. https://ethereum.org/en/eth2/staking/ https://ethereum.org/en/eth2/staking/
  - bfgoodrich 6y ago
    Hasn't Ethereum been moving to proof-of-stake for years now? It seems like something that is never going to actually happen, but is always held as redeeming.
  - latchkey 6y ago
    Ethereum [sic] is moving to PoS from PoW, but ETH doesn't suffer the same growth issue that BTC does because its hash algo is effectively tied to its hardware. It can run on PoW indefinitely and will likely do so for several more years until PoS is fully ready. There are a few asic's for ETH, but the hash algo is fundamentally executed through memory. Even if you build an asic for ETH, you are always tied to the speed of memory. Therefore, a GPU is going to be the most ROI efficient mechanism for a long time (asics cost more to build than a commodity GPU) and even more so, older GPUs work just as well from a ROI perspective because newer GPUs are more expensive. This means ETH does not see the same hashrate growth (and energy usage) as BTC, while maintaining the same level of security. The vast majority of energy usage for blockchains, is green energy hydropower using excess power from facilities that already exist. Why? Because this is the lowest cost and prior to this current bull run, was the only way to be profitable.
    - addaon 6y ago
      > asics cost more to build than a commodity GPU Why would this be true? The R&D costs of a commodity GPU can be amortized across more customers than an ASIC, and the same is somewhat true for capital costs (masks, etc) -- but the manufacturing cost of an ASIC should be at worst the same as a GPU (with one fewer middleman adding a margin on top of those costs), and in general cheaper (since die size can be reduced, or an older process can be used).
      - latchkey 6y ago
        Technically, a GPU is an ASIC. It really boils down to economy of scale. AMD can produce chips (and solutions) at much more scale (and thus far less expensive) than relatively small Innosilicon can. AMD has closer relationships to the fabs. It also is other factors that go into this. Like the critical memory controller component. AMD owns the patents. AMD can also buy memory chips in larger bulk (and thus less expensive). Also, the R&D on GPU's is an already amortized cost. They already exist. ASICs have to be engineered from the ground up and do what GPU's already do. At the end of the day, this is also beneficial because GPU's can be repurposed, while sha256 ASICs are just e-waste every time a new round of smaller nm tech comes out.
    - echelon 6y ago
      Is Ethereum going to be worth more than Bitcoin (market cap) when people realize how technologically superior it is?
      - latchkey 6y ago
        If I could predict the future, I'd be rich already! =)
        echelon 6y ago
        True, but sometimes a preponderance of smart opinions helps predict the shape of the future. (Or where I want to put my money :P)
- paulgb 6y ago
  There can’t be progress as long as it uses proof-of-work, and it would take a fork to change that so it almost certainly won’t happen. Any improvements to the efficiency of proof of work will be countered by a difficulty adjustment, by design.
- xiphias2 6y ago
  BTC works perfectly fine without carbon output, its depends on energy creation though (just like any other form of money). The Paris agreement was a big step moving humanity towards sustainable energy. US made progress in voting for a politician who promised to join the Paris agreement again. We'll see whether it will really happen.
  - zpeti 6y ago
    The Paris agreement was not enforceable, and the US is one of the countries that has actually done most to reduce carbon output. But hey, at least the rest of world leaders are virtue signaling about their greenness, that’ll help the planet!
    - xiphias2 6y ago
      US leadership was actively pushing for rolling back energy standards (that California was fighting for quite strongly). US has achieved a lot (especially Tesla) _despite_ the leadership working against it for a long time.
      - j0ba 6y ago
        True. Unfortunately many still think a centrally planned system of picking winners and losers is superior to the free market, but luckily the past 4 years was enough to send capable entrepreneurs such as Elon Musk into the stratosphere (and beyond).
        leogiertz 6y ago
        I don’t know, we all owe Germany quite a bit for their solar subsidies.
  - haram_masala 6y ago
    > BTC works perfectly fine without carbon output I’m not sure I follow this (admittedly I don’t know much about how BTC actually works). Doesn’t mining also serve the purpose of verifying transactions?
- zpeti 6y ago
  Ah HN, where the utopian cyberpunk dreaming of a decentralized uncontrollable currency meets the utopian environmentalist to whom any cause is evil that uses carbon.
- aresant 6y ago
  Lightning and similar are making steady progress which would reduce the carbon footprint somewhat I'm more interested in the variety of "energy recovery" startups out there - eg https://www.crusoeenergy.com/ https://www.crusoeenergy.com/ - that are harvesting wasted energy to mine cryptocurrencies
  - paulgb 6y ago
    > Lightning and similar are making steady progress which would reduce the carbon footprint They might bring down transaction fees, but most of the money in mining is from block rewards, which depends on the market price of Bitcoin rather than transaction volume.
    - zadler 6y ago
      At the moment this is true, however it is conceivable that tx fees could pay for the network in the future. At current prices, each tx would cost about 50 dollars to produce 125,000 dollars each block, as the block reward does today. This is not unreasonable if the market cap of Bitcoin continues to increase and it is used as a settlement layer with smaller transactions taking place on second layers like lightning or Ethereum.
- ttul 6y ago
  My understanding is that a great deal of Bitcoin mining takes place in corrupt jurisdictions where power can be obtained for free from power producers that have been captured through bribes and other forms of revenue sharing with officials. That power is not necessarily carbon free. It seems to me that the nature of Bitcoin as a pseudonymous currency actually facilitates and encourages illicit power stealing arrangements like this. In other words, it’s pretty easy for me to just send you some of my freshly minted BTC from the mining farm your company is powering, and nobody is likely to ever find out. Unless corruption can be rooted out (highly unlikely), there will be no incentive for Bitcoin mining energy to come from legitimate sources, never mind clean sources.
  - thrower23423423 6y ago
    Hmm. I'm surprised BTC isn't mined in India - a country with an extremely high power leakage, and provides free electricity for 'farmers'.
    - ChainOfFools 6y ago
      There has to be a goldilocks zone where high power theft and corruption is balanced with reasonable physical security and guarantee of stable power delivery, or your miners will short out the entire town supply, if they aren't simply stolen first. Also thy need cooling and are very noisy, attracting attention.
      - ttul 6y ago
        For example, the country of Georgia: https://www.npr.org/sections/parallels/2018/04/23/597780405/how-the-tiny-nation-of-georgia-became-a-bitcoin-behemoth https://www.npr.org/sections/parallels/2018/04/23/597780405/...
  - analog31 6y ago
    Does this represent Bitcoin serving as a tool of government monetary policy, like the dollar, but a different government? Could those governments pull the plug on bitcoin?
- modeless 6y ago
  > Has any progress been made The carbon footprint is funded by the block reward which is halved every 4 years until it dwindles to nothing. Progress is slow, but inexorable.
  - fidelramos 6y ago
    Not just the block reward, Bitcoin miners also receive the sum of the fees of the transactions included on each block. The idea with the progressively diminishing block reward is that transaction fees will represent a larger share of miners profits as time passes.
    - modeless 6y ago
      The block reward dominates by far. Transaction fees are paid directly by users. They will not pay more than the actual value they derive from the use of the network.
- Bobblebobble 6y ago
  The carbon footprint is estimated to be 37Mt CO2 per year, similar to New Zealand, and BTC represents close to half of the current global data centre electricity use. https://digiconomist.net/bitcoin-energy-consumption/ https://digiconomist.net/bitcoin-energy-consumption/
  - webinvest 6y ago
    Are you implying that if they only bombed New Zealand, they would sufficiently offset all of Bitcoin’s current energy usage? Are there countries are worth bombing for the carbon credits?
- sorenjan 6y ago
  I don't know what the carbon footprint is, but Cambridge University estimates the annualised consumption at the moment to be 87.02 TWh. https://cbeci.org/ https://cbeci.org/
- kpaystaxes 6y ago
  Bitcoin can actually be used to aid growth in rewewables and mitigate carbon emissions. A couple examples: (1) "bitcoin batteries" which can be a reliable consumer of renewable energy during otherwise low-demand periods and (2) replacing natural gas flaring with bitcoin mines. https://www.prnewswire.com/news-releases/layer1-launches-bitcoin-batteries-to-stabilize-energy-grids-by-releasing-electricity-to-meet-market-demand-301063984.html https://www.prnewswire.com/news-releases/layer1-launches-bit... https://www.crusoeenergy.com/news-and-media/2020/1/10/denver-business-journal https://www.crusoeenergy.com/news-and-media/2020/1/10/denver...
- SI_Rob 6y ago
  The entire point of Bitcoin is that you irreversibly give up something you value in exchange for creating a Bitcoin in return. The Bitcoin now stands for that lost value, and there is now a corresponding psychological motive to replace the valuable thing that was lost (electricity, and all that goes with it including environmental impact) by mentally investing that loss in the Bitcoin token. So you protect it, you support the network that it exists within, you talk it up to your social circle, you do everything you can to make it as valuable to others as it is to you. All of these activities also take time and resources, aggravating the impact of the original loss commitment. You do this because someday you want to give it to someone else, whom you've convinced of its worth, in order for them give you back the value you lost by creating it. There is no "environmental mitigation" for Bitcoin's energy use, this behavior (or a permutation of it in term of other forms of irreversibly burned value, like time* ) is an essential property of cryptocurrency, without which it would cease to exist. Disclaimer I hold Bitcoin, not because I think it is a new form of money or "decentralized" in any way that matters (quite the opposite in fact), but because it is possibly the most clever and subtle ruse to access the gambling instinct in a demographic whose constituents commonly believe themselves to be "above" playing the lottery or falling for Ponzi schemes. Yes, the irony is not lost on me. Still, this is a huge untapped market. * also a bit of a dodge as IIRC POS still requires keeping a machine running even if it's not dedicating all cycles to the staking algo. Anything that "recovers value" from the process of "burning value" defeats the entire purpose of burning value to create psychological motivation to mentally allocate it to the token it replaces. Which, incidentally, is why you won't see much growth from cryptos that try to do something "useful" (like fold proteins) while also standing as a counter for burned value. If running the algo is more useful for A, because A is in a position to monetize the work outside the currency being created, than it is for B, who can't use the data or results from the work algo, why would B prefer to support that crypto over another whose work algo is equally useless for all?
  - jariel 6y ago
    "There is no "environmental mitigation" for Bitcoin's energy use, this behavior ... is an essential property of cryptocurrency, without which it would cease to exist." This is based on the false premise that energy, or anything else needs to be given up in exchange for crypto, or any other form of currency. We could create a zillion cryptos out of thin air and just hand them out. That's one way to do it. Central banks do it another way. The 'energy' thing is just nonsense, it's just something that happens to be baked into this specific form of BTC generation.
- deleted 6y ago
  [deleted]
- rojeee 6y ago
  Indeed, I'm surprised that large corporations are buying in at this point. I wonder what their corporate social responsibility departments think about it...?
- yrral 6y ago
  Back in the days where all our electricity came from fossil fuels, I completely agree that marginal electricity usage was bad for the environment. However I think that thought has persisted with us even though it is no longer true 100% of the time. With renewables sometimes the marginal cost of electricity to our environment is near 0 or even negative (eg, during periods of higher winds and lower demand.) I predict that in the future as bitcoin mining becomes more and more of an efficiency game that you will see bitcoin mining be kind of a load balancer the grid, effectively turning off during peak demand (or low supply) times and contributing to the base load during regular times. For example, it may even help the economics of building new wind plants. Eg, currently it may not be profitable to build a new wind plant because base load is too low that the excess power generated would need to be sold off at 0 or even negative prices. However if bitcoin mining could be turned on during these times and off during periods of high demand, there will need to be fewer peaker plants in operation and it would positively affect the economics of opening a new wind plant. Bitcoin mining only cares about the cost of electricity at a given time, it is not like most other electricity demands that are very time based. With the large variance of electricity generation by renewables, I think bitcoin can in the future help smooth demand according to the real supply/demand curve. It's kind of like a different implementation of the Tesla utility grid batteries. Instead of deploying power, you force the grid to build more renewable capacity (that the miners are paying for) that you use except in peak periods, where you turn off and effectively provide the grid with more power.
- dontTango 6y ago
  I'm considering getting a mining rig to heat my house as an alternative to gas.
- varajelle 6y ago
  Every day, about 900 bitcoins are mined. So computing power for about 900*20k = $1.8m per day is "wasted". The more the price of bitcoin, the more energy is going to be used. Every 4 years, the amount of bitcoin created per day is divided by 2.
- shakezula 6y ago
  ETH2 is moving towards Proof of Stake and that should be a major step forward in reducing the energy consumption without making any major security trade offs.
albntomat0 6y ago
What's the current thoughts on Tether, and how its speculated potential collapse will affect the rest of the ecosystem? Also, what's the latest on scaling? The last time I looked into it, Lightening was a thing, but I don't follow it closely.
- jackmodern 6y ago
  Ignore the tether fud, old news. Lots of stable coins out there now that are fully regulated and partnering with US government (USDC).
  - rojeee 6y ago
    Tether's market cap is the largest of all the stable coins and it's unclear that Tether's liabilities are sufficiently collateralised and they can't/won't prove that they are. That's a problem for a product where the unique selling point is "stability". I've been in the Bitcoin/crypto space since 2009 and been through it all. My opinion now is that Bitcoin is an accidental Ponzi scheme - it started out with good intentions but got hijacked by tw*ts. Most of the discourse in the crypto community now looks like a carbon copy of any spread betting / gambling / day trading community. However, instead of a centralised market, there is a Rube Goldberg machine that provides the market infrastructure.
  - albntomat0 6y ago
    I'm not looking for a different stablecoin. I think the more accurate way to phrase my concern is this "If I own some Bitcoin, what happens to it if the rumors regarding Tether are true?"
- nwah1 6y ago
  Tether is still a scam, and the music is still playing. Don't be the last guy. As for lightning, it adds a layer of trust into a system whose reason for existence is trustlessness. If you don't care about trustlessness, you can already have fast and scalable transactions through normal banking.
  - 6y ago
ur-whale 6y ago
Previously discussed: https://news.ycombinator.com/item?id=25442377 https://news.ycombinator.com/item?id=25442377
seibelj 6y ago
Bitcoin is a pure computer-science phenomenon. Regardless of whether you personally feel this is a good or bad investment, I think the magnitude of this success over such a short time frame, the impact on the world, and the interest it and the wider crypto ecosystem receives from the non-tech world, is absolutely stunning. HN should accept that Bitcoin is an achievement of massive proportions.
- marta_morena_91 6y ago
  But it's really not. Bitcoin isn't anything special. If there were any real-world use cases for it (which there don't seem to be), this would have been done long ago or would have been done organically. As it stands, interest in bitcoin was largely null, until people realized that it's a great investment opportunity where everybody can get rich (tulips, anyone?)... The rest is history. Now alt coins were popping up like mushrooms because you can make even more money when you own the coin and can keep half the stock or more for yourself. 1. There is no use case for crypto currencies, except fraud and crime. 1. There may be use cases for centralized ledgers, however it seems like people are desperately trying to "find" use cases just the same way they are trying to find machine learning use cases. It's a marketing hype. If crypto currencies were actually "required" to solve any major use case, the implementation would follow easily from the requirements. The things its being used for right now are essentially crying out for crypto currencies and it doesn't take a genius to derive a crypt currency implementation for those requirements. However I would argue that 99% of these "use cases" are made up and would work as well or even better on a centralized architecture.
  - ur-whale 6y ago
    > 1. There is no use case for crypto currencies, except fraud and crime. So you have found a way to protect your wealth against inflation, I guess? Would love to hear what that is.
    - war1025 6y ago
      > So you have found a way to protect your wealth against inflation, That is generally known as investing. It's literally the entire point of buying stock instead of putting your money in a savings account.
louwrentius 6y ago
I wonder where the money comes from that funds this price. I'm very afraid that people who should know better, like pension funds, start buying this crap, in search for any return. This game of musical chairs will come down eventually.
- Everhusk 6y ago
  https://www.coindesk.com/ruffer-confirms-744m-bitcoin-investment https://www.coindesk.com/ruffer-confirms-744m-bitcoin-invest... https://www.kevinrooke.com/post/microstrategys-bitcoin-debt-bet https://www.kevinrooke.com/post/microstrategys-bitcoin-debt-... https://www.cnbc.com/2020/10/08/square-buys-50-million-in-bitcoin-says-cryptocurrency-aligns-with-companys-purpose.html https://www.cnbc.com/2020/10/08/square-buys-50-million-in-bi...
- silentsea90 6y ago
  How long does the "game of musical chairs" have to go on before you consider the possibility that this isn't one? It has been a decade since BTC was launched.
  - slg 6y ago
    Bernie Madoff operated his "game of musical chairs" for over twice that period of time. If age is the only argument you have to justify Bitcoin's value, we still have a while to go.
    - gruez 6y ago
      It's much easier to pull off a scam if have total control over it. Is there some mastermind behind the bitcoin scam?
      - slg 6y ago
        Calling Bitcoin a "game of musical chairs" doesn't necessarily imply it is a scam. It simply implies that the music will eventually stop and leave someone with huge loses. There doesn't need to be a mastermind behind that. The length of time the music has been playing shouldn't be any solace to anyone participating if they can't come up with other legitimate reasons why a $20k value is valid.
boh 6y ago
The real test is if this is still true by mid-Jan. The 2017-18 peak had a similar trajectory--Oct to Dec spike then fell by Jan--suggesting some weird tax related activity. I'm curious to see if things play out the same way.
- jjk166 6y ago
  Dec 2018 and Dec 2019 were both relative low points. It's also worth noting that bitcoin 15Xed in 2017, whereas it's only up 1.5X over 2020.
- csomar 6y ago
  It's still very early if you are comparing this to the 2017 bubble. Bitcoin moved from the old all-time high to around x20 higher. That would put bitcoin price around $400.000. A really frightening amount of money has to be moved into the ecosystem to make bitcoin worth that much.
  - cwkoss 6y ago
    If Bitcoin's price increases by just 4x, it will have a larger market cap than any company in the world.
_hdap 6y ago
I am NOT a fan of Bitcoin, but... Watch a real-time visualization of the global Bitcoin transaction flow, as it is happening right now: https://dailyblockchain.github.io/ https://dailyblockchain.github.io/ Each square is a bitcoin address (like a cryptographic public key) Each graph component is a transaction. The components appear as transactions are broadcast into the bitcoin P2P network (but before they are verified and committed to the blockchain) Each transaction simply transfers bitcoin: from one or more input addresses, to one or more output addresses. In other words, money flows from one or more previous owners, to one or more new owners. That's how a currency works Coin ownership flows from green to red (yellow is in/out: I pay you and take some change back at the same address) When the output of one transaction becomes an input for a new transaction, the components are pulled together This illustrates how Bitcoin is used. What do you notice?
- ur-whale 6y ago
  > What do you notice? Formation of large aggregates? [edit]: pretty blinkenlights?
- tudelo 6y ago
  What do you notice? Not sure what you are trying to allude to.
  - iforgottherest 6y ago
    Plenty of individual transactions (at least on this recording time scale) and not a flow as an economy would daily. Plus some odd transactions where money is allocated to several wallets at the same time. I wish it had the relative size included in the visualization.
    - NeutronStar 6y ago
      The more transactions are show the more links would appear. It also takes time for linked transactions to appear in real life.
    - ric2b 6y ago
deleted 6y ago
[deleted]
isuckatcoding 6y ago
But why...? > When this [rally to near $20,000] happened in 2017, there was a real lack of products for the new converts to experience, whereas today there are endless uses, protocols, services across farming, lending, standard trading, etc Is this really true though? My first instinct isn’t at all to go to blockchain/cryptocurrency for farming.
- vmception 6y ago
  they are referring to yield farming. people earn interest by putting their assets up as liquidity. making the markets deeper. this is one of the things that banks do with customer deposits except now there is no bank. anyway, it makes digital assets and cryptocurrencies yield producing instruments and it is predictably popular. along side that there is a fast growing autonomous insurance sector too.
- mantenpanther 6y ago
  Excessive worldwide money printing?
- tempsy 6y ago
  i don’t think it has anything to do with more use cases institutions are now buying bitcoin as a diversified asset class
  - JoshTko 6y ago
    This is the single most important use case that most people miss. Bitcoin doesn't need to do anything else.
    - mrlala 6y ago
      Sigh. I 100% understand what you are saying but I also 100% disagree with it. This is all greed with no substance. Wealthy people and those who desire to be wealthy are doing everything they can to arbitrarily prop up something which does not really have value. And they seem to be winning- which is everything that is wrong with the world right now.
syntaxing 6y ago
The appreciation and depreciation of Bitcoin is one of the things I don’t really understand. I get currency, capital flow, and asset to capital conversions. But for Bitcoin, where exactly is the value? Why is holding one Bitcoin appreciating so much faster compared to the USD? Is it because us as a society is perceiving the value of Bitcoin to appreciate (even though it’s illogical IMO to think so)?
- tomlue 6y ago
  The value of bitcoin doesn't need to increase in absolute terms for its USD value to increase.
  - snicksnak 6y ago
    This makes no sense to me. Isn't the value of bitcoin measured in USD?
    - gruez 6y ago
      The price of USD can go down.
- absolutelyrad 6y ago
  I'd like to think that in 10 years, Bitcoin or some other cryptocurrency would be one of the reserve currencies held by central banks. But there's no going back. Cryptocurrencies have their place, and they're here to stay.
- gruez 6y ago
  >Why is holding one Bitcoin appreciating so much faster compared to the USD? Is it because us as a society is perceiving the value of Bitcoin to appreciate (even though it’s illogical IMO to think so)? Same reason why asset (stocks, housing) prices have skyrocketed even though there's a pandemic going on: money printing.
  - jayd16 6y ago
cft 6y ago
We are seeing inflation in many assets due to QE. Probably just a matter of time till milk and gas similarly "appreciate".
- shrimpx 6y ago
  Inflation will be a couple percent points. TSLA is up 900% this year...
arithma 6y ago
Just a question, isn't all criticism against bitcoin applicable to gold? Money/Currency/Value in general can't be reduced or derived from first principles. You always have to take into account human nature, economic activity, and most unfortunately: psychology. So all criticism about how bitcoin inherently being pointless, sounds like off-tune. I want good reasons to/NOT-to buy in. First-world country citizens kind of trust their governments to at least behave lawfully, or at least be eventually accountable. There are systems in place for transactions and accounting, and "everyone" has access. The "Value" of bitcoin, coming from a struggling third-world country (Lebanon), is in the ability to be independent of a currency that is inflating quickly, being able to transact with the outside world (even if only in bulk) without being under the mercy of a failing financial system that is lurking around to take a share in every which way possible. The energy consumption needs of bitcoin are an obvious drawback. But I don't think it's fair to brush away the whole thing for only that reason. Disclosure: I own an embarrassingly small amount of bitcoin (~0.4BTC).
- epmaybe 6y ago
  That’s literally more money than I have in my bank account lol
- jayd16 6y ago
  >Just a question, isn't all criticism against bitcoin applicable to gold? Gold fluctuates a lot less. Its hard to swallow "ok ok bitcoin is useless but it can still be a stable currency/safe asset" when the price is booming and crashing every year.
  - proverbialbunny 6y ago
    Fluctuation has to do with volume. (eg, penny stock) In the 1700s the stock market looked a lot like bitcoin.
  - keymone 6y ago
    Bitcoin isn’t useless, it’s useful for storing or transferring Bitcoin in a permissionless way.
- 6y ago
jdu9 6y ago
It's kinda sad that the pricing or market capitalization is the only thing that is being talked about in the "cryptocurrency community", instead of focussing on how the technology can be useful for society. Like for example if you look at /r/Bitcoin, there's a sidebar with "Submit text/link NOT about price", yet virtually every post is about price, even if just indirectly (Paypal joins the cryptocurrency bandwagon and the top comments are that this is good for the price). Searching for Bitcoin on YouTube is likewise not a good idea unless you want to listen to dudes rambling about the price for hours. Back when I bought my first Bitcoin, I couldn't care less about the price. I spent it almost immediately for servers and other digital services. I don't regret that I didn't "HODL" it. What really counts is whether it is sound money and all the speculation doesn't help in that regard. If anything, the usefulness of e.g. Bitcoin declines due to rising transaction costs and constant price swings.
- ur-whale 6y ago
  Thank you for this, and I totally agree. The price of Bitcoin is largely irrelevant given how interesting the tech. that powers it actually is. Bitcoin is a fluid that aims to power a hydraulic machine, and once Lightning gets to where it should be (it's been a while, yes :\), my bet is that many of the naysayers will have no choice but to take a second look at it. The rise in price is just a side-effect.
- Entwickler 6y ago
  I'd suggest following ethereum and it's founder Vitalik. He's explicitly said things like, "If all that we accomplish is lambo memes and immature puns about "sharting", then I WILL leave. Though I still have a lot of hope that the community can steer in the right direction." He has worked with the UN world food program, and posts a lot of material on voting, economic fairness, and social aspects of blockchain in general. It seems like he is genuinely interested in using blockchain for general societal good, rather than just speculative price chasing.
  - dontTango 6y ago
    Ethereum removed the 100M soft cap on EIP 669. This was quietly slipped through with no debate. ETH shouldn't be trusted.
joshuakelly 6y ago
Let's pay tribute to the very first Hacker News thread about Bitcoin back in May, 2009 with this classic comment: https://news.ycombinator.com/item?id=599852 https://news.ycombinator.com/item?id=599852 > Well this is an exceptionally cute idea, but there is absolutely no way that anyone is going to have any faith in this currency.
- mmastrac 6y ago
  In fairness, it's 10 years later and sentiment still swings back and forth.
  - Taek 6y ago
    There is no question though that a lot of people have put their faith in Bitcoin. Misplaced or not, that original comment is wrong :)
    - ljf 6y ago
      I wonder what number of people actively use or hold bitcoin in any given month? Is there a dashboard for this and also transaction per month?
      - Taek 6y ago
        There's a dashboard for it somewhere and iirc something like 50-80% of bitcoins haven't moved in over a year.
  - brink 6y ago
    I mean if full negative sentiment is at three thousand dollars a coin, it's really not that bad.
- three_seagrass 6y ago
  A decade latter and it's still a hobby currency. Price is not a sole indicator of faith in a currency.
valarauko 6y ago
Slight deviation: does anybody have recommendations for hardware wallets? Pros/Cons?
- itsdsmurrell 6y ago
  Ledger.
- capnorange 6y ago
  coldcard if Bitcoin only. Trezor for crypto. Avoid Ledger if possible. I own all three. Currently using Coldcard + Casa.
  - Kiro 6y ago
    Why avoid Ledger?
    - AdamGibbins 6y ago
      They leaked everyones data that they were storing for no reason way past the period in which it was needed. So people are now being spammed via email and SMS phishing attacks on an almost daily basis.
  - sandeeps_ 6y ago
    what's wrong with Ledger?
    - Taek 6y ago
      Ledger is closed source, which is not great. Also, we've submitted bug reports to them before explaining how malware on a laptop could extract coins from users, and the response we got was 'won't fix'... Which is not great. The entire reason you use a hardware wallet is because you assume that less secure hardware has been compromised. I don't know that I would go as far as saying 'don't use ledger' though, all the hardware wallets have pros and cons and we don't really have a champion 'this one is best' yet. Though I might point to https://foundationdevices.com/ https://foundationdevices.com/ as being on the right track.
nikolay 6y ago
It's always goes how around the end of the year and crashes in the beginning of the next. Where's the news?
- JxLS-cpgbe0 6y ago
  "Institutional investment and mining are at an all-time high, indicating this may not be a bubble" is where the news is.
  - nikolay 6y ago
    It was a bubble, it is a bubble, and always will be a bubble - as it's not use for commerce. All these years and it's only used for speculation! So, it needs to be rebranded to cryptospeculation, not cryptocurrency!
- jjk166 6y ago
  Bitcoin hit relative lows in late 2018 and late 2019. The only years with a statistically significant increase at the end of the year were 2013 and 2017.
iforgottherest 6y ago
And yet the general interest (per google trends) is only twice as much as in 2013 when it first became popular. IMO this shows more speculation than actual demand.
nikolay 6y ago
They just caught the biggest electricity thieves in the Bulgaria - Bitcoin miners in a rural area, stealing electricity straight from the lines and using as much as 4,000 households. And it was a small-scale operation!
phoinix 6y ago
Someone has to feel sorry for Btc. Many people are going to lose money. Bitcoin has value. It is only Btc people that took a very nice technology and crippled it. The put a cap in it's block size, and they removed instructions of the Bitcoin Script language. Bitcoin's usage lies in it's use as an immutable ledger, that no one can change the past. We can put other information inside it,alongside with the money transactions, and we can be absolutely sure that no one messed with that information. An infinite number of use cases. For example say a cop makes an arrest. How can we be sure that the arrest was legitimate? A random person with a video camera may record the arrest, go to his home, edit it however he likes, upload it to the internet, and boom huge civil unrest! The solution lies with the cop recording the arrest by himself, uploading the information right away to the blockchain, and no person on the planet, no state, no goverment, can mess up with that information. The timestamp of the arrest is important too!
- wait_a_minute 6y ago
  I don't understand how "uploading the information right away to the blockchain" changes anything in this situation. Arrest information is already logged somewhere, and even if it was logged in an immutable public ledger that doesn't mean that people wouldn't immediately distrust arrests depending on the circumstances regardless of a blockchain being involved. It really seems like this post is just another example of vaunting the all-powerful all-knowing blockchain without it being clear and specific as to what the blockchain actually DOES for us in this situation.
  - phoinix 6y ago
    If a person distrusts always anything, from anyone, from anywhere then it is true that blockchain doesn't provide any solution. However blockchain can make it more difficult, for a corrupt official to change some official documents, or in some cases to make them disappear completely. The timestamp of the arrest is of the utterly most importance. When a cop that may be corrupt or not, we don't know, upload the arrest after 10 hours, then something fishy might going on, the video might be edited. People around usually witness the arrest, and they know around what time it took place. If the data is uploaded 10 minutes after the arrest, then we are more sure of the legitimace, than after 10 hours. That's all.
person_of_color 6y ago
There are two types of posters on HN. Tesla pumpers, and Bitcoin pumpers.
1970-01-01 6y ago
Good thing its just a fad, will fail, is rat poison, is already dead, and will be the biggest scam ever, etc. etc. https://99bitcoins.com/bitcoin-obituaries/ https://99bitcoins.com/bitcoin-obituaries/
- sandeeps_ 6y ago
  haha :D
alex_young 6y ago
I see lots of comments suggesting that BTC is a constant store of value and that it is rising in USD terms because of ‘money printing’. If that was the case, wouldn’t we see inflation in USD prices for a basket of goods? Isn’t inflation very close to zero? Others say they are sick of talking about BTC price and would rather focus on its utility. This makes sense, but for the same reason above it cannot happen since on a basket of goods basis BTC is deflationary. Your options if you hold it are to buy something with it today or to hold onto it for a short period of time and buy 2 things with it later. If BTC is actually viable as a currency, shouldn’t the goal be to get it to some kind of CPI stability?
- TechBro8615 6y ago
  I don’t know what the actual CPI says. But as a person on the street, I definitely see inflation everywhere I go. It’s especially obvious to me as I spent a few years out of the country and came back to much higher prices. Everything is significantly more expensive than it was five years ago.
  - duderific 6y ago
    The CPI is gamed to keep people from panicking, and to ensure that the government doesn't have to increase social security payments too much, as they're tied to official CPI numbers. Another way inflation is "hidden" is in things like product packaging. Look at how jars of spaghetti sauce, cereal boxes, packages of coffee etc. are shrinking. You pay the same price for fewer goods.
- flyGuyOnTheSly 6y ago
  The price of Eggs is up 50% in my neck of the woods over the past 6 months. House prices are up 20-30% over the same time frame. The stock market is up close to 50% over the same time frame... This is not happening because the economy is booming. It is happening because the limits on printing money have been completely erased. >In light of the shift to an ample reserves regime, the Board has reduced reserve requirement ratios to zero percent effective on March 26, the beginning of the next reserve maintenance period. This action eliminates reserve requirements for thousands of depository institutions and will help to support lending to households and businesses. Any American Bank can lend any amount of money without holding anything in reserve. Let that sink in for a minute. The reserve requirements used to be 10%... for decades... and money was still being created very fast due to lending from fractional reserve banks... Now fractional reserve banking is not even a thing... it's just no reserve banking. I am seriously concerned that north america will experience hyper inflation over the next few years as a result of that meeting back in March. Pens are powerful. [0] https://www.federalreserve.gov/newsevents/pressreleases/monetary20200315b.htm https://www.federalreserve.gov/newsevents/pressreleases/mone...
ogogmad 6y ago
I remember reading that the Lightning network can be attacked by people spamming it with withdrawal requests, resulting in funds being stolen from users. Furthermore, I remember reading that this attack is to some extent not solvable. I need to find a link. [EDIT: I think this might be it: https://decrypt.co/33917/bitcoin-stolen-lightning-network-attack-warn-researchers https://decrypt.co/33917/bitcoin-stolen-lightning-network-at....] I'm pro-Bitcoin, and I own some, but what worries me is whether the scalability problem will ever be satisfactorily solved. It's been 5 years since Lightning was first suggested and it's still only at Alpha stage. And if the scalability problems are never overcome, will Bitcoin still maintain whatever value it has now?
- drcross 6y ago
  Gold isn't free to transport. Bitcoin shouldn't aim to be either. We don't want starbucks transactions in the same database as people saving for their pension. If you're transporting large amounts of money (digital gold) scaling isn't an issue.
  - webinvest 6y ago
    Bitcoin has a hard limit of 4.6 transactions per second. Gold doesn’t. As Bitcoin becomes more popular, it becomes more expensive to transact as everyone bids up the transaction price. Many people with small balances in their wallet will see their entire wallet balance become illiquid because the fees will be higher than their entire investment. Eventually we could see institutions and brokerages being the main coin holders because if it costs $1000- $10000 per transaction, it only makes sense to do so in $500k+ transactions. Last time Bitcoin was $19000/ea, it cost me $180 to move the coins from one wallet to another.
- lawn 6y ago
  If you're looking for scaling, look at cryptocurrencies other than Bitcoin. On-chain scaling is far from explored, and it's really the only way to solve it properly.
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guidovranken 6y ago
You can't conveniently pay with it so after the "digital cash" idea didn't pan out people settled on it being "store of value". But if that was what people really wanted, they'd be cheering for less volatility, not more; people really want it to be a get rich quick scheme (and I get that). There is no decentralized social network in spite of people being dissatisfied with the centralized alternatives. The last time I tried an IPFS website it didn't load. The last time I tried Scuttlebutt it couldn't connect. It's been 12 years now and everything in crypto feels perpetually broken, unusable, beta-grade and stagnant, and it's very disappointing because I really wanted these solutions to exist. Ironically, I think "crypto" would have fared better if it was without monetary value, and its development was optimized for utility (like most other computer programs) instead of buying Lambo's. The way I see it, BitTorrent is still the most successful and useful decentralized tech of the last few decades. It's useful, ubiquitous, safe, clients can be maintained by a lone hobbyist out in Nebraska, and it requires no propaganda whatsoever to prosper because its value proposition is evident to anyone. With crypto, the perpetual funding of technologies that are never going to work ironically makes it a very un-libertarian economy. That said, I like having it around as an emergency payment system, and with the devaluation of fiat money and general downturn, BTC provides an attractive asset class next to stocks, gold and real estate.
TedShiller 6y ago
Adjusted for inflation and dollar printing it’s probably flat actually
rhacker 6y ago
Pump and dump by some trillion dollar colluding whales. They're hoping people start going "huh- this might be my last chance to get in because there's probably NOT going to be a crash this time" It's the largest vacuum cleaner in the world.
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272 points by wsieroci 6y ago

What's the carbon footprint of BTC like these days? Has any progress been made on mitigating this fundamental design issue?

robert_foss 6y ago
Yes, but not with Bitcoin. Etherium is currently moving from Proof-of-Work to Proof-of-Stake. https://ethereum.org/en/eth2/staking/ https://ethereum.org/en/eth2/staking/
- bfgoodrich 6y ago
  Hasn't Ethereum been moving to proof-of-stake for years now? It seems like something that is never going to actually happen, but is always held as redeeming.
- latchkey 6y ago
  Ethereum [sic] is moving to PoS from PoW, but ETH doesn't suffer the same growth issue that BTC does because its hash algo is effectively tied to its hardware. It can run on PoW indefinitely and will likely do so for several more years until PoS is fully ready. There are a few asic's for ETH, but the hash algo is fundamentally executed through memory. Even if you build an asic for ETH, you are always tied to the speed of memory. Therefore, a GPU is going to be the most ROI efficient mechanism for a long time (asics cost more to build than a commodity GPU) and even more so, older GPUs work just as well from a ROI perspective because newer GPUs are more expensive. This means ETH does not see the same hashrate growth (and energy usage) as BTC, while maintaining the same level of security. The vast majority of energy usage for blockchains, is green energy hydropower using excess power from facilities that already exist. Why? Because this is the lowest cost and prior to this current bull run, was the only way to be profitable.
  - addaon 6y ago
    > asics cost more to build than a commodity GPU Why would this be true? The R&D costs of a commodity GPU can be amortized across more customers than an ASIC, and the same is somewhat true for capital costs (masks, etc) -- but the manufacturing cost of an ASIC should be at worst the same as a GPU (with one fewer middleman adding a margin on top of those costs), and in general cheaper (since die size can be reduced, or an older process can be used).
    - latchkey 6y ago
      Technically, a GPU is an ASIC. It really boils down to economy of scale. AMD can produce chips (and solutions) at much more scale (and thus far less expensive) than relatively small Innosilicon can. AMD has closer relationships to the fabs. It also is other factors that go into this. Like the critical memory controller component. AMD owns the patents. AMD can also buy memory chips in larger bulk (and thus less expensive). Also, the R&D on GPU's is an already amortized cost. They already exist. ASICs have to be engineered from the ground up and do what GPU's already do. At the end of the day, this is also beneficial because GPU's can be repurposed, while sha256 ASICs are just e-waste every time a new round of smaller nm tech comes out.
  - echelon 6y ago
    Is Ethereum going to be worth more than Bitcoin (market cap) when people realize how technologically superior it is?
    - latchkey 6y ago
      If I could predict the future, I'd be rich already! =)
      - echelon 6y ago
        True, but sometimes a preponderance of smart opinions helps predict the shape of the future. (Or where I want to put my money :P)
paulgb 6y ago
There can’t be progress as long as it uses proof-of-work, and it would take a fork to change that so it almost certainly won’t happen. Any improvements to the efficiency of proof of work will be countered by a difficulty adjustment, by design.
xiphias2 6y ago
BTC works perfectly fine without carbon output, its depends on energy creation though (just like any other form of money). The Paris agreement was a big step moving humanity towards sustainable energy. US made progress in voting for a politician who promised to join the Paris agreement again. We'll see whether it will really happen.
- zpeti 6y ago
  The Paris agreement was not enforceable, and the US is one of the countries that has actually done most to reduce carbon output. But hey, at least the rest of world leaders are virtue signaling about their greenness, that’ll help the planet!
  - xiphias2 6y ago
    US leadership was actively pushing for rolling back energy standards (that California was fighting for quite strongly). US has achieved a lot (especially Tesla) _despite_ the leadership working against it for a long time.
    - j0ba 6y ago
      True. Unfortunately many still think a centrally planned system of picking winners and losers is superior to the free market, but luckily the past 4 years was enough to send capable entrepreneurs such as Elon Musk into the stratosphere (and beyond).
      - leogiertz 6y ago
        I don’t know, we all owe Germany quite a bit for their solar subsidies.
- haram_masala 6y ago
  > BTC works perfectly fine without carbon output I’m not sure I follow this (admittedly I don’t know much about how BTC actually works). Doesn’t mining also serve the purpose of verifying transactions?
zpeti 6y ago
Ah HN, where the utopian cyberpunk dreaming of a decentralized uncontrollable currency meets the utopian environmentalist to whom any cause is evil that uses carbon.
aresant 6y ago
Lightning and similar are making steady progress which would reduce the carbon footprint somewhat I'm more interested in the variety of "energy recovery" startups out there - eg https://www.crusoeenergy.com/ https://www.crusoeenergy.com/ - that are harvesting wasted energy to mine cryptocurrencies
- paulgb 6y ago
  > Lightning and similar are making steady progress which would reduce the carbon footprint They might bring down transaction fees, but most of the money in mining is from block rewards, which depends on the market price of Bitcoin rather than transaction volume.
  - zadler 6y ago
    At the moment this is true, however it is conceivable that tx fees could pay for the network in the future. At current prices, each tx would cost about 50 dollars to produce 125,000 dollars each block, as the block reward does today. This is not unreasonable if the market cap of Bitcoin continues to increase and it is used as a settlement layer with smaller transactions taking place on second layers like lightning or Ethereum.
ttul 6y ago
My understanding is that a great deal of Bitcoin mining takes place in corrupt jurisdictions where power can be obtained for free from power producers that have been captured through bribes and other forms of revenue sharing with officials. That power is not necessarily carbon free. It seems to me that the nature of Bitcoin as a pseudonymous currency actually facilitates and encourages illicit power stealing arrangements like this. In other words, it’s pretty easy for me to just send you some of my freshly minted BTC from the mining farm your company is powering, and nobody is likely to ever find out. Unless corruption can be rooted out (highly unlikely), there will be no incentive for Bitcoin mining energy to come from legitimate sources, never mind clean sources.
- thrower23423423 6y ago
  Hmm. I'm surprised BTC isn't mined in India - a country with an extremely high power leakage, and provides free electricity for 'farmers'.
  - ChainOfFools 6y ago
    There has to be a goldilocks zone where high power theft and corruption is balanced with reasonable physical security and guarantee of stable power delivery, or your miners will short out the entire town supply, if they aren't simply stolen first. Also thy need cooling and are very noisy, attracting attention.
    - ttul 6y ago
      For example, the country of Georgia: https://www.npr.org/sections/parallels/2018/04/23/597780405/how-the-tiny-nation-of-georgia-became-a-bitcoin-behemoth https://www.npr.org/sections/parallels/2018/04/23/597780405/...
- analog31 6y ago
  Does this represent Bitcoin serving as a tool of government monetary policy, like the dollar, but a different government? Could those governments pull the plug on bitcoin?
modeless 6y ago
> Has any progress been made The carbon footprint is funded by the block reward which is halved every 4 years until it dwindles to nothing. Progress is slow, but inexorable.
- fidelramos 6y ago
  Not just the block reward, Bitcoin miners also receive the sum of the fees of the transactions included on each block. The idea with the progressively diminishing block reward is that transaction fees will represent a larger share of miners profits as time passes.
  - modeless 6y ago
    The block reward dominates by far. Transaction fees are paid directly by users. They will not pay more than the actual value they derive from the use of the network.
Bobblebobble 6y ago
The carbon footprint is estimated to be 37Mt CO2 per year, similar to New Zealand, and BTC represents close to half of the current global data centre electricity use. https://digiconomist.net/bitcoin-energy-consumption/ https://digiconomist.net/bitcoin-energy-consumption/
- webinvest 6y ago
  Are you implying that if they only bombed New Zealand, they would sufficiently offset all of Bitcoin’s current energy usage? Are there countries are worth bombing for the carbon credits?
sorenjan 6y ago
I don't know what the carbon footprint is, but Cambridge University estimates the annualised consumption at the moment to be 87.02 TWh. https://cbeci.org/ https://cbeci.org/
kpaystaxes 6y ago
Bitcoin can actually be used to aid growth in rewewables and mitigate carbon emissions. A couple examples: (1) "bitcoin batteries" which can be a reliable consumer of renewable energy during otherwise low-demand periods and (2) replacing natural gas flaring with bitcoin mines. https://www.prnewswire.com/news-releases/layer1-launches-bitcoin-batteries-to-stabilize-energy-grids-by-releasing-electricity-to-meet-market-demand-301063984.html https://www.prnewswire.com/news-releases/layer1-launches-bit... https://www.crusoeenergy.com/news-and-media/2020/1/10/denver-business-journal https://www.crusoeenergy.com/news-and-media/2020/1/10/denver...
SI_Rob 6y ago
The entire point of Bitcoin is that you irreversibly give up something you value in exchange for creating a Bitcoin in return. The Bitcoin now stands for that lost value, and there is now a corresponding psychological motive to replace the valuable thing that was lost (electricity, and all that goes with it including environmental impact) by mentally investing that loss in the Bitcoin token. So you protect it, you support the network that it exists within, you talk it up to your social circle, you do everything you can to make it as valuable to others as it is to you. All of these activities also take time and resources, aggravating the impact of the original loss commitment. You do this because someday you want to give it to someone else, whom you've convinced of its worth, in order for them give you back the value you lost by creating it. There is no "environmental mitigation" for Bitcoin's energy use, this behavior (or a permutation of it in term of other forms of irreversibly burned value, like time* ) is an essential property of cryptocurrency, without which it would cease to exist. Disclaimer I hold Bitcoin, not because I think it is a new form of money or "decentralized" in any way that matters (quite the opposite in fact), but because it is possibly the most clever and subtle ruse to access the gambling instinct in a demographic whose constituents commonly believe themselves to be "above" playing the lottery or falling for Ponzi schemes. Yes, the irony is not lost on me. Still, this is a huge untapped market. * also a bit of a dodge as IIRC POS still requires keeping a machine running even if it's not dedicating all cycles to the staking algo. Anything that "recovers value" from the process of "burning value" defeats the entire purpose of burning value to create psychological motivation to mentally allocate it to the token it replaces. Which, incidentally, is why you won't see much growth from cryptos that try to do something "useful" (like fold proteins) while also standing as a counter for burned value. If running the algo is more useful for A, because A is in a position to monetize the work outside the currency being created, than it is for B, who can't use the data or results from the work algo, why would B prefer to support that crypto over another whose work algo is equally useless for all?
- jariel 6y ago
  "There is no "environmental mitigation" for Bitcoin's energy use, this behavior ... is an essential property of cryptocurrency, without which it would cease to exist." This is based on the false premise that energy, or anything else needs to be given up in exchange for crypto, or any other form of currency. We could create a zillion cryptos out of thin air and just hand them out. That's one way to do it. Central banks do it another way. The 'energy' thing is just nonsense, it's just something that happens to be baked into this specific form of BTC generation.
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rojeee 6y ago
Indeed, I'm surprised that large corporations are buying in at this point. I wonder what their corporate social responsibility departments think about it...?
yrral 6y ago
Back in the days where all our electricity came from fossil fuels, I completely agree that marginal electricity usage was bad for the environment. However I think that thought has persisted with us even though it is no longer true 100% of the time. With renewables sometimes the marginal cost of electricity to our environment is near 0 or even negative (eg, during periods of higher winds and lower demand.) I predict that in the future as bitcoin mining becomes more and more of an efficiency game that you will see bitcoin mining be kind of a load balancer the grid, effectively turning off during peak demand (or low supply) times and contributing to the base load during regular times. For example, it may even help the economics of building new wind plants. Eg, currently it may not be profitable to build a new wind plant because base load is too low that the excess power generated would need to be sold off at 0 or even negative prices. However if bitcoin mining could be turned on during these times and off during periods of high demand, there will need to be fewer peaker plants in operation and it would positively affect the economics of opening a new wind plant. Bitcoin mining only cares about the cost of electricity at a given time, it is not like most other electricity demands that are very time based. With the large variance of electricity generation by renewables, I think bitcoin can in the future help smooth demand according to the real supply/demand curve. It's kind of like a different implementation of the Tesla utility grid batteries. Instead of deploying power, you force the grid to build more renewable capacity (that the miners are paying for) that you use except in peak periods, where you turn off and effectively provide the grid with more power.
dontTango 6y ago
I'm considering getting a mining rig to heat my house as an alternative to gas.
varajelle 6y ago
Every day, about 900 bitcoins are mined. So computing power for about 900*20k = $1.8m per day is "wasted". The more the price of bitcoin, the more energy is going to be used. Every 4 years, the amount of bitcoin created per day is divided by 2.
shakezula 6y ago
ETH2 is moving towards Proof of Stake and that should be a major step forward in reducing the energy consumption without making any major security trade offs.

albntomat0 6y ago

What's the current thoughts on Tether, and how its speculated potential collapse will affect the rest of the ecosystem? Also, what's the latest on scaling? The last time I looked into it, Lightening was a thing, but I don't follow it closely.

jackmodern 6y ago
Ignore the tether fud, old news. Lots of stable coins out there now that are fully regulated and partnering with US government (USDC).
- rojeee 6y ago
  Tether's market cap is the largest of all the stable coins and it's unclear that Tether's liabilities are sufficiently collateralised and they can't/won't prove that they are. That's a problem for a product where the unique selling point is "stability". I've been in the Bitcoin/crypto space since 2009 and been through it all. My opinion now is that Bitcoin is an accidental Ponzi scheme - it started out with good intentions but got hijacked by tw*ts. Most of the discourse in the crypto community now looks like a carbon copy of any spread betting / gambling / day trading community. However, instead of a centralised market, there is a Rube Goldberg machine that provides the market infrastructure.
- albntomat0 6y ago
  I'm not looking for a different stablecoin. I think the more accurate way to phrase my concern is this "If I own some Bitcoin, what happens to it if the rumors regarding Tether are true?"
nwah1 6y ago
Tether is still a scam, and the music is still playing. Don't be the last guy. As for lightning, it adds a layer of trust into a system whose reason for existence is trustlessness. If you don't care about trustlessness, you can already have fast and scalable transactions through normal banking.
- 6y ago

ur-whale 6y ago

Previously discussed: https://news.ycombinator.com/item?id=25442377 https://news.ycombinator.com/item?id=25442377

seibelj 6y ago

Bitcoin is a pure computer-science phenomenon. Regardless of whether you personally feel this is a good or bad investment, I think the magnitude of this success over such a short time frame, the impact on the world, and the interest it and the wider crypto ecosystem receives from the non-tech world, is absolutely stunning. HN should accept that Bitcoin is an achievement of massive proportions.

marta_morena_91 6y ago
But it's really not. Bitcoin isn't anything special. If there were any real-world use cases for it (which there don't seem to be), this would have been done long ago or would have been done organically. As it stands, interest in bitcoin was largely null, until people realized that it's a great investment opportunity where everybody can get rich (tulips, anyone?)... The rest is history. Now alt coins were popping up like mushrooms because you can make even more money when you own the coin and can keep half the stock or more for yourself. 1. There is no use case for crypto currencies, except fraud and crime. 1. There may be use cases for centralized ledgers, however it seems like people are desperately trying to "find" use cases just the same way they are trying to find machine learning use cases. It's a marketing hype. If crypto currencies were actually "required" to solve any major use case, the implementation would follow easily from the requirements. The things its being used for right now are essentially crying out for crypto currencies and it doesn't take a genius to derive a crypt currency implementation for those requirements. However I would argue that 99% of these "use cases" are made up and would work as well or even better on a centralized architecture.
- ur-whale 6y ago
  > 1. There is no use case for crypto currencies, except fraud and crime. So you have found a way to protect your wealth against inflation, I guess? Would love to hear what that is.
  - war1025 6y ago
    > So you have found a way to protect your wealth against inflation, That is generally known as investing. It's literally the entire point of buying stock instead of putting your money in a savings account.

louwrentius 6y ago

I wonder where the money comes from that funds this price. I'm very afraid that people who should know better, like pension funds, start buying this crap, in search for any return. This game of musical chairs will come down eventually.

Everhusk 6y ago
https://www.coindesk.com/ruffer-confirms-744m-bitcoin-investment https://www.coindesk.com/ruffer-confirms-744m-bitcoin-invest... https://www.kevinrooke.com/post/microstrategys-bitcoin-debt-bet https://www.kevinrooke.com/post/microstrategys-bitcoin-debt-... https://www.cnbc.com/2020/10/08/square-buys-50-million-in-bitcoin-says-cryptocurrency-aligns-with-companys-purpose.html https://www.cnbc.com/2020/10/08/square-buys-50-million-in-bi...
silentsea90 6y ago
How long does the "game of musical chairs" have to go on before you consider the possibility that this isn't one? It has been a decade since BTC was launched.
- slg 6y ago
  Bernie Madoff operated his "game of musical chairs" for over twice that period of time. If age is the only argument you have to justify Bitcoin's value, we still have a while to go.
  - gruez 6y ago
    It's much easier to pull off a scam if have total control over it. Is there some mastermind behind the bitcoin scam?
    - slg 6y ago
      Calling Bitcoin a "game of musical chairs" doesn't necessarily imply it is a scam. It simply implies that the music will eventually stop and leave someone with huge loses. There doesn't need to be a mastermind behind that. The length of time the music has been playing shouldn't be any solace to anyone participating if they can't come up with other legitimate reasons why a $20k value is valid.

boh 6y ago

The real test is if this is still true by mid-Jan. The 2017-18 peak had a similar trajectory--Oct to Dec spike then fell by Jan--suggesting some weird tax related activity. I'm curious to see if things play out the same way.

jjk166 6y ago
Dec 2018 and Dec 2019 were both relative low points. It's also worth noting that bitcoin 15Xed in 2017, whereas it's only up 1.5X over 2020.
csomar 6y ago
It's still very early if you are comparing this to the 2017 bubble. Bitcoin moved from the old all-time high to around x20 higher. That would put bitcoin price around $400.000. A really frightening amount of money has to be moved into the ecosystem to make bitcoin worth that much.
- cwkoss 6y ago
  If Bitcoin's price increases by just 4x, it will have a larger market cap than any company in the world.

_hdap 6y ago

I am NOT a fan of Bitcoin, but... Watch a real-time visualization of the global Bitcoin transaction flow, as it is happening right now: https://dailyblockchain.github.io/ https://dailyblockchain.github.io/ Each square is a bitcoin address (like a cryptographic public key) Each graph component is a transaction. The components appear as transactions are broadcast into the bitcoin P2P network (but before they are verified and committed to the blockchain) Each transaction simply transfers bitcoin: from one or more input addresses, to one or more output addresses. In other words, money flows from one or more previous owners, to one or more new owners. That's how a currency works Coin ownership flows from green to red (yellow is in/out: I pay you and take some change back at the same address) When the output of one transaction becomes an input for a new transaction, the components are pulled together This illustrates how Bitcoin is used. What do you notice?

ur-whale 6y ago
> What do you notice? Formation of large aggregates? [edit]: pretty blinkenlights?
tudelo 6y ago
What do you notice? Not sure what you are trying to allude to.
- iforgottherest 6y ago
  Plenty of individual transactions (at least on this recording time scale) and not a flow as an economy would daily. Plus some odd transactions where money is allocated to several wallets at the same time. I wish it had the relative size included in the visualization.
  - NeutronStar 6y ago
    The more transactions are show the more links would appear. It also takes time for linked transactions to appear in real life.
  - ric2b 6y ago

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isuckatcoding 6y ago

But why...? > When this [rally to near $20,000] happened in 2017, there was a real lack of products for the new converts to experience, whereas today there are endless uses, protocols, services across farming, lending, standard trading, etc Is this really true though? My first instinct isn’t at all to go to blockchain/cryptocurrency for farming.

vmception 6y ago
they are referring to yield farming. people earn interest by putting their assets up as liquidity. making the markets deeper. this is one of the things that banks do with customer deposits except now there is no bank. anyway, it makes digital assets and cryptocurrencies yield producing instruments and it is predictably popular. along side that there is a fast growing autonomous insurance sector too.
mantenpanther 6y ago
Excessive worldwide money printing?
tempsy 6y ago
i don’t think it has anything to do with more use cases institutions are now buying bitcoin as a diversified asset class
- JoshTko 6y ago
  This is the single most important use case that most people miss. Bitcoin doesn't need to do anything else.
  - mrlala 6y ago
    Sigh. I 100% understand what you are saying but I also 100% disagree with it. This is all greed with no substance. Wealthy people and those who desire to be wealthy are doing everything they can to arbitrarily prop up something which does not really have value. And they seem to be winning- which is everything that is wrong with the world right now.

syntaxing 6y ago

The appreciation and depreciation of Bitcoin is one of the things I don’t really understand. I get currency, capital flow, and asset to capital conversions. But for Bitcoin, where exactly is the value? Why is holding one Bitcoin appreciating so much faster compared to the USD? Is it because us as a society is perceiving the value of Bitcoin to appreciate (even though it’s illogical IMO to think so)?

tomlue 6y ago
The value of bitcoin doesn't need to increase in absolute terms for its USD value to increase.
- snicksnak 6y ago
  This makes no sense to me. Isn't the value of bitcoin measured in USD?
  - gruez 6y ago
    The price of USD can go down.
absolutelyrad 6y ago
I'd like to think that in 10 years, Bitcoin or some other cryptocurrency would be one of the reserve currencies held by central banks. But there's no going back. Cryptocurrencies have their place, and they're here to stay.
gruez 6y ago
>Why is holding one Bitcoin appreciating so much faster compared to the USD? Is it because us as a society is perceiving the value of Bitcoin to appreciate (even though it’s illogical IMO to think so)? Same reason why asset (stocks, housing) prices have skyrocketed even though there's a pandemic going on: money printing.
- jayd16 6y ago

cft 6y ago

We are seeing inflation in many assets due to QE. Probably just a matter of time till milk and gas similarly "appreciate".

shrimpx 6y ago
Inflation will be a couple percent points. TSLA is up 900% this year...

arithma 6y ago

Just a question, isn't all criticism against bitcoin applicable to gold? Money/Currency/Value in general can't be reduced or derived from first principles. You always have to take into account human nature, economic activity, and most unfortunately: psychology. So all criticism about how bitcoin inherently being pointless, sounds like off-tune. I want good reasons to/NOT-to buy in. First-world country citizens kind of trust their governments to at least behave lawfully, or at least be eventually accountable. There are systems in place for transactions and accounting, and "everyone" has access. The "Value" of bitcoin, coming from a struggling third-world country (Lebanon), is in the ability to be independent of a currency that is inflating quickly, being able to transact with the outside world (even if only in bulk) without being under the mercy of a failing financial system that is lurking around to take a share in every which way possible. The energy consumption needs of bitcoin are an obvious drawback. But I don't think it's fair to brush away the whole thing for only that reason. Disclosure: I own an embarrassingly small amount of bitcoin (~0.4BTC).

epmaybe 6y ago
That’s literally more money than I have in my bank account lol
jayd16 6y ago
>Just a question, isn't all criticism against bitcoin applicable to gold? Gold fluctuates a lot less. Its hard to swallow "ok ok bitcoin is useless but it can still be a stable currency/safe asset" when the price is booming and crashing every year.
- proverbialbunny 6y ago
  Fluctuation has to do with volume. (eg, penny stock) In the 1700s the stock market looked a lot like bitcoin.
- keymone 6y ago
  Bitcoin isn’t useless, it’s useful for storing or transferring Bitcoin in a permissionless way.
6y ago

jdu9 6y ago

It's kinda sad that the pricing or market capitalization is the only thing that is being talked about in the "cryptocurrency community", instead of focussing on how the technology can be useful for society. Like for example if you look at /r/Bitcoin, there's a sidebar with "Submit text/link NOT about price", yet virtually every post is about price, even if just indirectly (Paypal joins the cryptocurrency bandwagon and the top comments are that this is good for the price). Searching for Bitcoin on YouTube is likewise not a good idea unless you want to listen to dudes rambling about the price for hours. Back when I bought my first Bitcoin, I couldn't care less about the price. I spent it almost immediately for servers and other digital services. I don't regret that I didn't "HODL" it. What really counts is whether it is sound money and all the speculation doesn't help in that regard. If anything, the usefulness of e.g. Bitcoin declines due to rising transaction costs and constant price swings.

ur-whale 6y ago
Thank you for this, and I totally agree. The price of Bitcoin is largely irrelevant given how interesting the tech. that powers it actually is. Bitcoin is a fluid that aims to power a hydraulic machine, and once Lightning gets to where it should be (it's been a while, yes :\), my bet is that many of the naysayers will have no choice but to take a second look at it. The rise in price is just a side-effect.
Entwickler 6y ago
I'd suggest following ethereum and it's founder Vitalik. He's explicitly said things like, "If all that we accomplish is lambo memes and immature puns about "sharting", then I WILL leave. Though I still have a lot of hope that the community can steer in the right direction." He has worked with the UN world food program, and posts a lot of material on voting, economic fairness, and social aspects of blockchain in general. It seems like he is genuinely interested in using blockchain for general societal good, rather than just speculative price chasing.
- dontTango 6y ago
  Ethereum removed the 100M soft cap on EIP 669. This was quietly slipped through with no debate. ETH shouldn't be trusted.

joshuakelly 6y ago

Let's pay tribute to the very first Hacker News thread about Bitcoin back in May, 2009 with this classic comment: https://news.ycombinator.com/item?id=599852 https://news.ycombinator.com/item?id=599852 > Well this is an exceptionally cute idea, but there is absolutely no way that anyone is going to have any faith in this currency.

mmastrac 6y ago
In fairness, it's 10 years later and sentiment still swings back and forth.
- Taek 6y ago
  There is no question though that a lot of people have put their faith in Bitcoin. Misplaced or not, that original comment is wrong :)
  - ljf 6y ago
    I wonder what number of people actively use or hold bitcoin in any given month? Is there a dashboard for this and also transaction per month?
    - Taek 6y ago
      There's a dashboard for it somewhere and iirc something like 50-80% of bitcoins haven't moved in over a year.
- brink 6y ago
  I mean if full negative sentiment is at three thousand dollars a coin, it's really not that bad.
three_seagrass 6y ago
A decade latter and it's still a hobby currency. Price is not a sole indicator of faith in a currency.

valarauko 6y ago

Slight deviation: does anybody have recommendations for hardware wallets? Pros/Cons?

itsdsmurrell 6y ago
Ledger.
capnorange 6y ago
coldcard if Bitcoin only. Trezor for crypto. Avoid Ledger if possible. I own all three. Currently using Coldcard + Casa.
- Kiro 6y ago
  Why avoid Ledger?
  - AdamGibbins 6y ago
    They leaked everyones data that they were storing for no reason way past the period in which it was needed. So people are now being spammed via email and SMS phishing attacks on an almost daily basis.
- sandeeps_ 6y ago
  what's wrong with Ledger?
  - Taek 6y ago
    Ledger is closed source, which is not great. Also, we've submitted bug reports to them before explaining how malware on a laptop could extract coins from users, and the response we got was 'won't fix'... Which is not great. The entire reason you use a hardware wallet is because you assume that less secure hardware has been compromised. I don't know that I would go as far as saying 'don't use ledger' though, all the hardware wallets have pros and cons and we don't really have a champion 'this one is best' yet. Though I might point to https://foundationdevices.com/ https://foundationdevices.com/ as being on the right track.

nikolay 6y ago

It's always goes how around the end of the year and crashes in the beginning of the next. Where's the news?

JxLS-cpgbe0 6y ago
"Institutional investment and mining are at an all-time high, indicating this may not be a bubble" is where the news is.
- nikolay 6y ago
  It was a bubble, it is a bubble, and always will be a bubble - as it's not use for commerce. All these years and it's only used for speculation! So, it needs to be rebranded to cryptospeculation, not cryptocurrency!
jjk166 6y ago
Bitcoin hit relative lows in late 2018 and late 2019. The only years with a statistically significant increase at the end of the year were 2013 and 2017.

iforgottherest 6y ago

And yet the general interest (per google trends) is only twice as much as in 2013 when it first became popular. IMO this shows more speculation than actual demand.

nikolay 6y ago

They just caught the biggest electricity thieves in the Bulgaria - Bitcoin miners in a rural area, stealing electricity straight from the lines and using as much as 4,000 households. And it was a small-scale operation!

phoinix 6y ago

Someone has to feel sorry for Btc. Many people are going to lose money. Bitcoin has value. It is only Btc people that took a very nice technology and crippled it. The put a cap in it's block size, and they removed instructions of the Bitcoin Script language. Bitcoin's usage lies in it's use as an immutable ledger, that no one can change the past. We can put other information inside it,alongside with the money transactions, and we can be absolutely sure that no one messed with that information. An infinite number of use cases. For example say a cop makes an arrest. How can we be sure that the arrest was legitimate? A random person with a video camera may record the arrest, go to his home, edit it however he likes, upload it to the internet, and boom huge civil unrest! The solution lies with the cop recording the arrest by himself, uploading the information right away to the blockchain, and no person on the planet, no state, no goverment, can mess up with that information. The timestamp of the arrest is important too!

wait_a_minute 6y ago
I don't understand how "uploading the information right away to the blockchain" changes anything in this situation. Arrest information is already logged somewhere, and even if it was logged in an immutable public ledger that doesn't mean that people wouldn't immediately distrust arrests depending on the circumstances regardless of a blockchain being involved. It really seems like this post is just another example of vaunting the all-powerful all-knowing blockchain without it being clear and specific as to what the blockchain actually DOES for us in this situation.
- phoinix 6y ago
  If a person distrusts always anything, from anyone, from anywhere then it is true that blockchain doesn't provide any solution. However blockchain can make it more difficult, for a corrupt official to change some official documents, or in some cases to make them disappear completely. The timestamp of the arrest is of the utterly most importance. When a cop that may be corrupt or not, we don't know, upload the arrest after 10 hours, then something fishy might going on, the video might be edited. People around usually witness the arrest, and they know around what time it took place. If the data is uploaded 10 minutes after the arrest, then we are more sure of the legitimace, than after 10 hours. That's all.

person_of_color 6y ago

There are two types of posters on HN. Tesla pumpers, and Bitcoin pumpers.

1970-01-01 6y ago

Good thing its just a fad, will fail, is rat poison, is already dead, and will be the biggest scam ever, etc. etc. https://99bitcoins.com/bitcoin-obituaries/ https://99bitcoins.com/bitcoin-obituaries/

sandeeps_ 6y ago
haha :D

alex_young 6y ago

I see lots of comments suggesting that BTC is a constant store of value and that it is rising in USD terms because of ‘money printing’. If that was the case, wouldn’t we see inflation in USD prices for a basket of goods? Isn’t inflation very close to zero? Others say they are sick of talking about BTC price and would rather focus on its utility. This makes sense, but for the same reason above it cannot happen since on a basket of goods basis BTC is deflationary. Your options if you hold it are to buy something with it today or to hold onto it for a short period of time and buy 2 things with it later. If BTC is actually viable as a currency, shouldn’t the goal be to get it to some kind of CPI stability?

TechBro8615 6y ago
I don’t know what the actual CPI says. But as a person on the street, I definitely see inflation everywhere I go. It’s especially obvious to me as I spent a few years out of the country and came back to much higher prices. Everything is significantly more expensive than it was five years ago.
- duderific 6y ago
  The CPI is gamed to keep people from panicking, and to ensure that the government doesn't have to increase social security payments too much, as they're tied to official CPI numbers. Another way inflation is "hidden" is in things like product packaging. Look at how jars of spaghetti sauce, cereal boxes, packages of coffee etc. are shrinking. You pay the same price for fewer goods.
flyGuyOnTheSly 6y ago
The price of Eggs is up 50% in my neck of the woods over the past 6 months. House prices are up 20-30% over the same time frame. The stock market is up close to 50% over the same time frame... This is not happening because the economy is booming. It is happening because the limits on printing money have been completely erased. >In light of the shift to an ample reserves regime, the Board has reduced reserve requirement ratios to zero percent effective on March 26, the beginning of the next reserve maintenance period. This action eliminates reserve requirements for thousands of depository institutions and will help to support lending to households and businesses. Any American Bank can lend any amount of money without holding anything in reserve. Let that sink in for a minute. The reserve requirements used to be 10%... for decades... and money was still being created very fast due to lending from fractional reserve banks... Now fractional reserve banking is not even a thing... it's just no reserve banking. I am seriously concerned that north america will experience hyper inflation over the next few years as a result of that meeting back in March. Pens are powerful. [0] https://www.federalreserve.gov/newsevents/pressreleases/monetary20200315b.htm https://www.federalreserve.gov/newsevents/pressreleases/mone...

ogogmad 6y ago

I remember reading that the Lightning network can be attacked by people spamming it with withdrawal requests, resulting in funds being stolen from users. Furthermore, I remember reading that this attack is to some extent not solvable. I need to find a link. [EDIT: I think this might be it: https://decrypt.co/33917/bitcoin-stolen-lightning-network-attack-warn-researchers https://decrypt.co/33917/bitcoin-stolen-lightning-network-at....] I'm pro-Bitcoin, and I own some, but what worries me is whether the scalability problem will ever be satisfactorily solved. It's been 5 years since Lightning was first suggested and it's still only at Alpha stage. And if the scalability problems are never overcome, will Bitcoin still maintain whatever value it has now?

drcross 6y ago
Gold isn't free to transport. Bitcoin shouldn't aim to be either. We don't want starbucks transactions in the same database as people saving for their pension. If you're transporting large amounts of money (digital gold) scaling isn't an issue.
- webinvest 6y ago
  Bitcoin has a hard limit of 4.6 transactions per second. Gold doesn’t. As Bitcoin becomes more popular, it becomes more expensive to transact as everyone bids up the transaction price. Many people with small balances in their wallet will see their entire wallet balance become illiquid because the fees will be higher than their entire investment. Eventually we could see institutions and brokerages being the main coin holders because if it costs $1000- $10000 per transaction, it only makes sense to do so in $500k+ transactions. Last time Bitcoin was $19000/ea, it cost me $180 to move the coins from one wallet to another.
lawn 6y ago
If you're looking for scaling, look at cryptocurrencies other than Bitcoin. On-chain scaling is far from explored, and it's really the only way to solve it properly.

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guidovranken 6y ago

You can't conveniently pay with it so after the "digital cash" idea didn't pan out people settled on it being "store of value". But if that was what people really wanted, they'd be cheering for less volatility, not more; people really want it to be a get rich quick scheme (and I get that). There is no decentralized social network in spite of people being dissatisfied with the centralized alternatives. The last time I tried an IPFS website it didn't load. The last time I tried Scuttlebutt it couldn't connect. It's been 12 years now and everything in crypto feels perpetually broken, unusable, beta-grade and stagnant, and it's very disappointing because I really wanted these solutions to exist. Ironically, I think "crypto" would have fared better if it was without monetary value, and its development was optimized for utility (like most other computer programs) instead of buying Lambo's. The way I see it, BitTorrent is still the most successful and useful decentralized tech of the last few decades. It's useful, ubiquitous, safe, clients can be maintained by a lone hobbyist out in Nebraska, and it requires no propaganda whatsoever to prosper because its value proposition is evident to anyone. With crypto, the perpetual funding of technologies that are never going to work ironically makes it a very un-libertarian economy. That said, I like having it around as an emergency payment system, and with the devaluation of fiat money and general downturn, BTC provides an attractive asset class next to stocks, gold and real estate.

TedShiller 6y ago

Adjusted for inflation and dollar printing it’s probably flat actually

rhacker 6y ago

Pump and dump by some trillion dollar colluding whales. They're hoping people start going "huh- this might be my last chance to get in because there's probably NOT going to be a crash this time" It's the largest vacuum cleaner in the world.

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