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What can't be ignored is the ludicrous energy waste that goes into bitcoin and its speculative nature. The energy cost may go down over time as the block rewar

What can't be ignored is the ludicrous energy waste that goes into bitcoin and its speculative nature. The energy cost may go down over time as the block reward decays, but the economics of transaction fees taking over isn't totally clear yet. Block difficulty still hasn't reached stability. The speculative bubbles are a bigger problem. Bitcoin looks like at best a $5K-$10K thing in the long term (just look at the 2018 bubble). The argument was always "with limited supply bitcoin price will go to infinity!" but there isn't limited supply because bitcoin isn't the only cryptocurrency. The Bitcoin-cash split doubled the supply. Every new cryptocurrency product increases the available supply. Smart investors will diversify cryptocurrency holdings and bitcoin will eventually be priced accordingly; the cryptocurrencies that can grow appropriately with the economy will have the most stable prices. At least difficulty adjusts more frequently than the block reward decays so that it's very unlikely to have a giant crash where over-invested miners all go bankrupt on a downturn and no one bothers to mine the next block.

Siira 6y ago
Energy "waste" is in the eye of the beholder. The energy is doing useful work by making the system more secure (at a rough rate of 50%, which is actually rather efficient as energy consumption goes). Of course, having some better solution that doesn't need energy as its source of trust would be great, and perhaps proof-of-stake will one day work. But the fact of the matter is that there is no better alternative today, and the traditional governmental currencies don't count.
- benlivengood 6y ago
  > But the fact of the matter is that there is no better alternative today, and the traditional governmental currencies don't count. I can spend USD almost anywhere I want at maybe a 1.5% transaction fee depending on merchant, with 1%-2% cash back (I calculated a 1.67% rebate for 2019). Technically this is only nominally government currency since it's just bank credit denominated in USD. Bitcoin's blockchain does around ~100K BTC in volume a day at ~100 BTC in fees and ~1000 BTC mined (since May) which both are effectively costs going to the miners' electricity. 1.1% vs 1.5% with cash back isn't a huge argument for bitcoin. If transaction fees stay around .1% until the block reward hits .05% then the efficiency argument eventually goes away because miners will be competing on transaction efficiency and not block rewards any more. I like the technology; it's cool and the fact that it works at all is amazing. If overall costs were closer to .1% and speculators were not the primary users it would be revolutionary.
- mangus 6y ago
  > perhaps proof-of-stake will one day work It already works. https://why.cardano.org/en/introduction/proof-of-stake/ https://why.cardano.org/en/introduction/proof-of-stake/
  - Siira 6y ago
    That link has no description of the consensus algorithm they are using, and links to a youtube video, not a paper. Not that I feel like reading new crypto papers, there are dozens of unproven claims around. When something gains actual traction, I’ll read its paper to see how rigorous and secure it is.

Siira 6y ago

Energy "waste" is in the eye of the beholder. The energy is doing useful work by making the system more secure (at a rough rate of 50%, which is actually rather efficient as energy consumption goes). Of course, having some better solution that doesn't need energy as its source of trust would be great, and perhaps proof-of-stake will one day work. But the fact of the matter is that there is no better alternative today, and the traditional governmental currencies don't count.

benlivengood 6y ago
> But the fact of the matter is that there is no better alternative today, and the traditional governmental currencies don't count. I can spend USD almost anywhere I want at maybe a 1.5% transaction fee depending on merchant, with 1%-2% cash back (I calculated a 1.67% rebate for 2019). Technically this is only nominally government currency since it's just bank credit denominated in USD. Bitcoin's blockchain does around ~100K BTC in volume a day at ~100 BTC in fees and ~1000 BTC mined (since May) which both are effectively costs going to the miners' electricity. 1.1% vs 1.5% with cash back isn't a huge argument for bitcoin. If transaction fees stay around .1% until the block reward hits .05% then the efficiency argument eventually goes away because miners will be competing on transaction efficiency and not block rewards any more. I like the technology; it's cool and the fact that it works at all is amazing. If overall costs were closer to .1% and speculators were not the primary users it would be revolutionary.
mangus 6y ago
> perhaps proof-of-stake will one day work It already works. https://why.cardano.org/en/introduction/proof-of-stake/ https://why.cardano.org/en/introduction/proof-of-stake/
- Siira 6y ago
  That link has no description of the consensus algorithm they are using, and links to a youtube video, not a paper. Not that I feel like reading new crypto papers, there are dozens of unproven claims around. When something gains actual traction, I’ll read its paper to see how rigorous and secure it is.