5 ms·

It is quite pathetic that a purported 'future of payments' is so inefficient in so many ways. This is why I will never participate in systems like bitcoin that

It is quite pathetic that a purported 'future of payments' is so inefficient in so many ways. This is why I will never participate in systems like bitcoin that consume hundreds of TwH (and growing) each year.

analog31 6y ago
In my view, "law of unintended consequences" looms large here. On the other hand, "proof of work" reminds me that the equivalence of heat and work was proven more than 150 years ago by Joule.
- eurasiantiger 6y ago
  That equivalence exists in the domain of classical physics. Bitcoin only exists in semiconductor systems: its ineffectiveness stems from the extra logical layer (gates on silicon) which, while based on quantum effects, does not utilize quantum effects directly for calculation.
  - AaronFriel 6y ago
    This sounds like quantum woo. If we had desktop quantum computers, and a computationally hard algorithm on qubits was used for proof of work instead, we would still end up in the same arms race of ever more expensive, ever more power hungry systems do that work. What would happen if Bitcoins work function (the hardness) was made 10 times easier, would miners use 1/10th the power budget? No, they'd just 10x their mining rate. Why? Because other miners have every incentive to do the same. Likewise with a quantum algorithm.
  - dogma1138 6y ago
    Isn’t a perfect computer is also a perfect heater? Quantum or not...
  - flyinglizard 6y ago
    Doesn’t any method by which work is done, in a proof of work system, consume energy?
    - eurasiantiger 6y ago
      Locally and classically, yes. But quantum effects demonstrably break locality. Call it quantum woo if you want, but the reality is that we perceive the world top-down and know incredibly little of how our universe actually functions from the bottom up.
  - birktj 6y ago
    Isn't there also a fundamental equivalence between information and energy in physics? And so is there not a lower limit to the amount of energy required to compute a SHA256 hash of a certain number of bytes, and by extension mine a bitcoin block?
    - dogma1138 6y ago
      Yes but only for irreversible computation https://en.m.wikipedia.org/wiki/Landauer%27s_principle https://en.m.wikipedia.org/wiki/Landauer%27s_principle
      - deepnotderp 6y ago
        Even for reversible computation the Margolus-Levitin theorem has been hypothesized
        dogma1138 6y ago
        Isn’t the Margolus Levitin theorem slightly different? As in while it puts the maximum bound of amount of computation per J it doesn’t enforces a requirement that the entropy increase needs to be through a non-information degree of freedom as in heat.
wtf_is_up 6y ago
I don't think btc has been purported the future of payments for years, since things like ETH, ADA, ALGO have been proven better for that. BTC is considered 'digital gold', as in an alternative asset class that millenials and zoomers have adopted in lieu of gold. And now it has become mainstream for fund managers with large AUM to hold some without being laughed out of wall street.
eloff 6y ago
Its not a payment system (unless the transaction is sufficiently large). It's more like digital gold. But gold has a track record of holding value over millennia. Bitcoin is only a decade old. Will it hold up over time? Nobody actually knows.
- agravier 6y ago
  > Its not a payment system (unless the transaction is sufficiently large). > It's more like digital gold. As explained by the famous paper: "Bitcoin: Definitely Not A Peer-to-Peer Electronic Cash System"
  - auntienomen 6y ago
    And rebutted in the equally well known "Bitcoin: A Comically Badly Designed and Completely Dysfunctional Peer-to-Peer Electronic Cash System".
    - agravier 6y ago
      I perfectly agree that Bitcoin has stopped innovating long ago to become many people's wasteful cash cow, and needs to die soon. But I don't like "it's actually meant to be digital gold" revisionism.
    - sp332 6y ago
      It was an impressive proof of concept. There are technically better cryptocurrencies (along pretty much any dimension), but they just didn't get as much attention. Maybe these articles about how bad bitcoin is should call out some alternatives.
      - Bluestein 6y ago
        This. Point to the many, innovative, options.
        sp332 6y ago
amir734jj 6y ago
As an owner of 50 bitcoins that I bought in 2010, I must say I agree with you. I don't see bitcoin as a future of money nor payment.
- abledon 6y ago
  what about Ethereum?
  - latchkey 6y ago
    ETH is great, but it has some scaling issues that are going to take years to sort out. One benefit of ETH over BTC mining is that PoW mechanism (ethash) has, so far, kept most ASICs off the network (1). This has prevented the speed / power race BTC faces. In addition, the fastest GPUs are not necessarily the most ROI efficient, so people aren't EOL'ing their hardware every week. Even better is that GPUs still have life after mining. (1) Yes, there are ethash asics, but being a memory constrained algo means that at the end of the day, the limiting factor is memory, not asic chips. The other issue is availability... shipping asics out of China is expensive. Disclosure: very very large ETH miner
  - amir734jj 6y ago
    I didn't know what Ethereum was at that time. I was 16. Cryptocurrency I think is a bubble. I hope it bursts.
- UncleOxidant 6y ago
  Congratulations. You can now retire.
  - amir734jj 6y ago
    Nope. I'm doing PhD in computer science now and I work full time as a software engineer and teach at university. I'm not retiring anytime soon :)
- tempestn 6y ago
  I'm curious, did you originally own more than 50? If not, do you have a plan for when you will sell? I know if I'd bought 50 bitcoins back in 2010 I would have sold them, or at least most of them, many times over by now.
superkuh 6y ago
You better not particpate in fiat currencies that maintain themselves by spending TwHs to maintain their standing armies (or diplomatic relations with countries that do have standing armies).
- trimbo 6y ago
  Spending energy on bitcoin would replace the need for militaries?
  - superkuh 6y ago
    No, nation states and their fiat currencies are locked into the bare metal layer of human relations and the only thing that matters is ability to legitimately threaten to kill humans and destroy infrastructure. (or an alliance with a country that has those capabilities) Bitcoin is not a nationstate and doesn't have the weaknesses of nation states and their economic systems. It uses far less energy to establish and maintain itself.
- hashkb 6y ago
  Don't you need the armies to protect the infrastructure that powers bitcoin? And if you get to the point where you don't need armies, do you need a massive global network to verify you can trust the people you're doing business with?
  - superkuh 6y ago
    Bitcoin infrastructure is distributed widely across the world. No single country disappearing off the face of the earth entirely would take it down before the internet itself went down.
    - noxer 6y ago
      Assuming Thanos would snap away China (the whole land not just the people) bitcoin definitely could be considered "down" because it would no longer mine blocks every 10 minutes on average. Difficulty does adjust but that take weeks. the internet would not be effected like that.
zadler 6y ago
Never say never.
noxer 6y ago
Its a long solved problem. Just years after bitcoin went live bitcoin devs figured out that PoW just cant be the solution. FBA (Federated Byzantine Agreement) DLT ("blockchains") where the result or making "a better bitcoin". There is no need to burn energy to solve the double spending problem. All you need is a distributed way to agree on Tx order. Whoever tries a double spend just f**ed up themself and simply wont know which one will be ordered first and which one therefore will be invalid. Thats not a problem for any honest participant. See xrpl.org if you wanna read more in dept about this. There are plenty other protects using BFA instead of PoW/PoS by now.
human 6y ago
There’s definitely been improvements in cryptocurrencies since Bitcoin was launched. I’m a big fan of Cardano for example which is led by a scientific community and not apes posting diamond hands and rockets. Sadly it seems like the network effects and “brand” of Bitcoin is winning over better technology. This has to change before we spend a significant portion of our power capacity on a money system. I don’t want aliens to see us like that when they come visit.

analog31 6y ago

In my view, "law of unintended consequences" looms large here. On the other hand, "proof of work" reminds me that the equivalence of heat and work was proven more than 150 years ago by Joule.

eurasiantiger 6y ago
That equivalence exists in the domain of classical physics. Bitcoin only exists in semiconductor systems: its ineffectiveness stems from the extra logical layer (gates on silicon) which, while based on quantum effects, does not utilize quantum effects directly for calculation.
- AaronFriel 6y ago
  This sounds like quantum woo. If we had desktop quantum computers, and a computationally hard algorithm on qubits was used for proof of work instead, we would still end up in the same arms race of ever more expensive, ever more power hungry systems do that work. What would happen if Bitcoins work function (the hardness) was made 10 times easier, would miners use 1/10th the power budget? No, they'd just 10x their mining rate. Why? Because other miners have every incentive to do the same. Likewise with a quantum algorithm.
- dogma1138 6y ago
  Isn’t a perfect computer is also a perfect heater? Quantum or not...
- flyinglizard 6y ago
  Doesn’t any method by which work is done, in a proof of work system, consume energy?
  - eurasiantiger 6y ago
    Locally and classically, yes. But quantum effects demonstrably break locality. Call it quantum woo if you want, but the reality is that we perceive the world top-down and know incredibly little of how our universe actually functions from the bottom up.
- birktj 6y ago
  Isn't there also a fundamental equivalence between information and energy in physics? And so is there not a lower limit to the amount of energy required to compute a SHA256 hash of a certain number of bytes, and by extension mine a bitcoin block?
  - dogma1138 6y ago
    Yes but only for irreversible computation https://en.m.wikipedia.org/wiki/Landauer%27s_principle https://en.m.wikipedia.org/wiki/Landauer%27s_principle
    - deepnotderp 6y ago
      Even for reversible computation the Margolus-Levitin theorem has been hypothesized
      - dogma1138 6y ago
        Isn’t the Margolus Levitin theorem slightly different? As in while it puts the maximum bound of amount of computation per J it doesn’t enforces a requirement that the entropy increase needs to be through a non-information degree of freedom as in heat.

wtf_is_up 6y ago

I don't think btc has been purported the future of payments for years, since things like ETH, ADA, ALGO have been proven better for that. BTC is considered 'digital gold', as in an alternative asset class that millenials and zoomers have adopted in lieu of gold. And now it has become mainstream for fund managers with large AUM to hold some without being laughed out of wall street.

eloff 6y ago

Its not a payment system (unless the transaction is sufficiently large). It's more like digital gold. But gold has a track record of holding value over millennia. Bitcoin is only a decade old. Will it hold up over time? Nobody actually knows.

agravier 6y ago
> Its not a payment system (unless the transaction is sufficiently large). > It's more like digital gold. As explained by the famous paper: "Bitcoin: Definitely Not A Peer-to-Peer Electronic Cash System"
- auntienomen 6y ago
  And rebutted in the equally well known "Bitcoin: A Comically Badly Designed and Completely Dysfunctional Peer-to-Peer Electronic Cash System".
  - agravier 6y ago
    I perfectly agree that Bitcoin has stopped innovating long ago to become many people's wasteful cash cow, and needs to die soon. But I don't like "it's actually meant to be digital gold" revisionism.
  - sp332 6y ago
    It was an impressive proof of concept. There are technically better cryptocurrencies (along pretty much any dimension), but they just didn't get as much attention. Maybe these articles about how bad bitcoin is should call out some alternatives.
    - Bluestein 6y ago
      This. Point to the many, innovative, options.
      - sp332 6y ago

amir734jj 6y ago

As an owner of 50 bitcoins that I bought in 2010, I must say I agree with you. I don't see bitcoin as a future of money nor payment.

abledon 6y ago
what about Ethereum?
- latchkey 6y ago
  ETH is great, but it has some scaling issues that are going to take years to sort out. One benefit of ETH over BTC mining is that PoW mechanism (ethash) has, so far, kept most ASICs off the network (1). This has prevented the speed / power race BTC faces. In addition, the fastest GPUs are not necessarily the most ROI efficient, so people aren't EOL'ing their hardware every week. Even better is that GPUs still have life after mining. (1) Yes, there are ethash asics, but being a memory constrained algo means that at the end of the day, the limiting factor is memory, not asic chips. The other issue is availability... shipping asics out of China is expensive. Disclosure: very very large ETH miner
- amir734jj 6y ago
  I didn't know what Ethereum was at that time. I was 16. Cryptocurrency I think is a bubble. I hope it bursts.
UncleOxidant 6y ago
Congratulations. You can now retire.
- amir734jj 6y ago
  Nope. I'm doing PhD in computer science now and I work full time as a software engineer and teach at university. I'm not retiring anytime soon :)
tempestn 6y ago
I'm curious, did you originally own more than 50? If not, do you have a plan for when you will sell? I know if I'd bought 50 bitcoins back in 2010 I would have sold them, or at least most of them, many times over by now.

superkuh 6y ago

You better not particpate in fiat currencies that maintain themselves by spending TwHs to maintain their standing armies (or diplomatic relations with countries that do have standing armies).

trimbo 6y ago
Spending energy on bitcoin would replace the need for militaries?
- superkuh 6y ago
  No, nation states and their fiat currencies are locked into the bare metal layer of human relations and the only thing that matters is ability to legitimately threaten to kill humans and destroy infrastructure. (or an alliance with a country that has those capabilities) Bitcoin is not a nationstate and doesn't have the weaknesses of nation states and their economic systems. It uses far less energy to establish and maintain itself.
hashkb 6y ago
Don't you need the armies to protect the infrastructure that powers bitcoin? And if you get to the point where you don't need armies, do you need a massive global network to verify you can trust the people you're doing business with?
- superkuh 6y ago
  Bitcoin infrastructure is distributed widely across the world. No single country disappearing off the face of the earth entirely would take it down before the internet itself went down.
  - noxer 6y ago
    Assuming Thanos would snap away China (the whole land not just the people) bitcoin definitely could be considered "down" because it would no longer mine blocks every 10 minutes on average. Difficulty does adjust but that take weeks. the internet would not be effected like that.

zadler 6y ago

Never say never.

noxer 6y ago

Its a long solved problem. Just years after bitcoin went live bitcoin devs figured out that PoW just cant be the solution. FBA (Federated Byzantine Agreement) DLT ("blockchains") where the result or making "a better bitcoin". There is no need to burn energy to solve the double spending problem. All you need is a distributed way to agree on Tx order. Whoever tries a double spend just f**ed up themself and simply wont know which one will be ordered first and which one therefore will be invalid. Thats not a problem for any honest participant. See xrpl.org if you wanna read more in dept about this. There are plenty other protects using BFA instead of PoW/PoS by now.

human 6y ago

There’s definitely been improvements in cryptocurrencies since Bitcoin was launched. I’m a big fan of Cardano for example which is led by a scientific community and not apes posting diamond hands and rockets. Sadly it seems like the network effects and “brand” of Bitcoin is winning over better technology. This has to change before we spend a significant portion of our power capacity on a money system. I don’t want aliens to see us like that when they come visit.