6 ms·

Sooooo how does that equilibrium should look like which stops the energy race? Everyone can calculate bitcoins with equal effort? Or is it still an arms race o

by Hermio 5y ago

Sooooo how does that equilibrium should look like which stops the energy race? Everyone can calculate bitcoins with equal effort? Or is it still an arms race on who can gather more resources (energy/asics)?

hparadiz 5y ago
The equilibrium is based on the hash rate difficulty which increases as more miners are added to the system. Miners can choose to jump into the system at any time with no restrictions. If a hash block is mined 'too fast' then the difficulty is increased proportionally. Of course as miners leave the network the difficulty also occasionally drops. The power needed to run these miners is entirely arbitrary. Just like how an old computer used more power for less computation so too is it possible for asics to get more efficient and there's ultimately a huge financial incentive to do so. You can't block it or ban it. Like bittorrent it's nature is essentially to be free. Eventually someone somewhere will obfuscate the traffic just enough to get through any firewall or detection system. Ultimately the bitcoin network is actually low bandwidth so sending results from a miner is possibly even with garbage internet. Even if you 'ban' it all you've done is banned exchanges from converting to and from fiat but anyone who already had bitcoin can go somewhere else in the world to trade it or simply trade it for cash in person. Any jurisdiction that does that will be just sitting out while the rest of the world moves on with the new world economy. Complaining about bitcoin is peak "old man yells at cloud". Blocking or destroying the network is literally impossible short of destroying the whole Internet.
- lxgr 5y ago
  > The power needed to run these miners is entirely arbitrary. No, the power is precisely equal to the value of being able to transact on the network to all participants, as determined in an auction roughly every ten minutes (in addition to block rewards for now). > Complaining about bitcoin is peak "old man yells at cloud". I propose "person yells at cloud" (of CO2 emissions) as a realistic alternative.
  - hparadiz 5y ago
    > No, the power is precisely equal to the value of being able to transact on the network to all participants, as determined in an auction roughly every ten minutes (in addition to block rewards for now). I think you need to run a miner for a few days to learn the technology before making wildly inaccurate statements.
    - lxgr 5y ago
      What‘s inaccurate about my statement? I am quite familiar with mining, but I‘d argue that‘s besides the point: This is a question of economics much more than technology.
      - hparadiz 5y ago
        You claim that it's possible to tell how much energy was used to produce a block minting solution given the difficulty. It is not. If you actually mined you would know that no two miners use the same amount of energy for a given hash rate and also you would know that it's possible to come up with the solution too early or too late entirely through luck and therefore you can't directly estimate how much energy was used to produce a result. All estimates of how much energy the bitcoin network uses are completely made up and should not be trusted.
        rcxdude 5y ago
        It's true you can't predict exactly the energy used in a given block, but you can predict the energy use of blocks on average: this is not very difficult because the energy efficiency of state of the art mining hardware is known, and the difficulty is known.
        lxgr 5y ago
        > If you actually mined you would know that no two miners use the same amount of energy for a given hash rate True but irrelevant: The upper bound for rentability is the cost of electricity plus the capital cost of the mining equipment. As soon as the sum of these two exceeds the expected mining reward, rational miners stop mining. I don't doubt that there are inefficient miners out there, but I strongly suspect the majority to act according to their rational economic self-interest and not as players in an expensive technological lottery. > it's possible to come up with the solution too early or too late entirely through luck Yes, but not consistently and therefore also not profitably so. The law of large numbers [1] applies. [1] https://en.wikipedia.org/wiki/Law_of_large_numbers https://en.wikipedia.org/wiki/Law_of_large_numbers
- Hermio 5y ago
  You have not shown a real scenario how bitcoin could work without an energy armes race. The power consumption is NOT arbitrary: Everyone who owns bitcoins has to be motivated to keep bitcoin alive. More people having bitcoin means more people need to make sure that mining is happening. The second point is, bitcoin mining requires a certain amount of distribution to work as intended which leads to: you need a critical mass of people doing the mining as you can't just trust 3 people mining it for you and you trusting them. Especially as bitcoin is often mentioned as being 'free'. Therefore you can't just go to a bank or country and let them mine it with nearly no power consumption. The third point is: Mining has to be motivational enough and therefore it will hover between being worth to do so in countries like USA (for distribution reasons) and gambling (gambling provides high margin with high risks and i think that could be a good UPPER resource consumption limit). Forth: Bitcoin mining always needs an incentive which makes it competitive: If everyone can mine unlimited and there is no factor to determine who can mine more, than it just doesn't work anymore. We now have a system which ALWAYS consumes resources and its critical to understand 'consume'. That resources is gone. Otherwise your proof of work wouldn't work anymore. A global economy is easy able to destroy something like bitcoin: China can just ban it, countries can put pressure on other countries like USA and partners do with North Korea. No country has a benefit of allowing bitcoin. A country has control over their currency and they like to keep the control. "the new world economy" what? Do you think we have our current financial system just for fun and we all move to bitcoin? Our current financial system is build and has grown over a long period. We all LIKE that current system. I like to be able to go to my bank and show my passport and get my money. I like to know that untaxed money is harder to hide. I like the knowlwedge that you can't transfer high amount of money from left to right without an external party looking over it for money laundring. Those systems are beneficial for every normal human being. Don't throw in garbage statements like "old man yells at cloud". Either argue or don't.
  - hparadiz 5y ago
    None of this matters. The system is unblock able and your opinion doesn't matter. It will go on without me or you. That is how it is. You can complain all you want.
    - 5y ago

by Hermio 5y ago

hparadiz 5y ago

The equilibrium is based on the hash rate difficulty which increases as more miners are added to the system. Miners can choose to jump into the system at any time with no restrictions. If a hash block is mined 'too fast' then the difficulty is increased proportionally. Of course as miners leave the network the difficulty also occasionally drops. The power needed to run these miners is entirely arbitrary. Just like how an old computer used more power for less computation so too is it possible for asics to get more efficient and there's ultimately a huge financial incentive to do so. You can't block it or ban it. Like bittorrent it's nature is essentially to be free. Eventually someone somewhere will obfuscate the traffic just enough to get through any firewall or detection system. Ultimately the bitcoin network is actually low bandwidth so sending results from a miner is possibly even with garbage internet. Even if you 'ban' it all you've done is banned exchanges from converting to and from fiat but anyone who already had bitcoin can go somewhere else in the world to trade it or simply trade it for cash in person. Any jurisdiction that does that will be just sitting out while the rest of the world moves on with the new world economy. Complaining about bitcoin is peak "old man yells at cloud". Blocking or destroying the network is literally impossible short of destroying the whole Internet.

lxgr 5y ago
> The power needed to run these miners is entirely arbitrary. No, the power is precisely equal to the value of being able to transact on the network to all participants, as determined in an auction roughly every ten minutes (in addition to block rewards for now). > Complaining about bitcoin is peak "old man yells at cloud". I propose "person yells at cloud" (of CO2 emissions) as a realistic alternative.
- hparadiz 5y ago
  > No, the power is precisely equal to the value of being able to transact on the network to all participants, as determined in an auction roughly every ten minutes (in addition to block rewards for now). I think you need to run a miner for a few days to learn the technology before making wildly inaccurate statements.
  - lxgr 5y ago
    What‘s inaccurate about my statement? I am quite familiar with mining, but I‘d argue that‘s besides the point: This is a question of economics much more than technology.
    - hparadiz 5y ago
      You claim that it's possible to tell how much energy was used to produce a block minting solution given the difficulty. It is not. If you actually mined you would know that no two miners use the same amount of energy for a given hash rate and also you would know that it's possible to come up with the solution too early or too late entirely through luck and therefore you can't directly estimate how much energy was used to produce a result. All estimates of how much energy the bitcoin network uses are completely made up and should not be trusted.
      - rcxdude 5y ago
        It's true you can't predict exactly the energy used in a given block, but you can predict the energy use of blocks on average: this is not very difficult because the energy efficiency of state of the art mining hardware is known, and the difficulty is known.
      - lxgr 5y ago
        > If you actually mined you would know that no two miners use the same amount of energy for a given hash rate True but irrelevant: The upper bound for rentability is the cost of electricity plus the capital cost of the mining equipment. As soon as the sum of these two exceeds the expected mining reward, rational miners stop mining. I don't doubt that there are inefficient miners out there, but I strongly suspect the majority to act according to their rational economic self-interest and not as players in an expensive technological lottery. > it's possible to come up with the solution too early or too late entirely through luck Yes, but not consistently and therefore also not profitably so. The law of large numbers [1] applies. [1] https://en.wikipedia.org/wiki/Law_of_large_numbers https://en.wikipedia.org/wiki/Law_of_large_numbers
Hermio 5y ago
You have not shown a real scenario how bitcoin could work without an energy armes race. The power consumption is NOT arbitrary: Everyone who owns bitcoins has to be motivated to keep bitcoin alive. More people having bitcoin means more people need to make sure that mining is happening. The second point is, bitcoin mining requires a certain amount of distribution to work as intended which leads to: you need a critical mass of people doing the mining as you can't just trust 3 people mining it for you and you trusting them. Especially as bitcoin is often mentioned as being 'free'. Therefore you can't just go to a bank or country and let them mine it with nearly no power consumption. The third point is: Mining has to be motivational enough and therefore it will hover between being worth to do so in countries like USA (for distribution reasons) and gambling (gambling provides high margin with high risks and i think that could be a good UPPER resource consumption limit). Forth: Bitcoin mining always needs an incentive which makes it competitive: If everyone can mine unlimited and there is no factor to determine who can mine more, than it just doesn't work anymore. We now have a system which ALWAYS consumes resources and its critical to understand 'consume'. That resources is gone. Otherwise your proof of work wouldn't work anymore. A global economy is easy able to destroy something like bitcoin: China can just ban it, countries can put pressure on other countries like USA and partners do with North Korea. No country has a benefit of allowing bitcoin. A country has control over their currency and they like to keep the control. "the new world economy" what? Do you think we have our current financial system just for fun and we all move to bitcoin? Our current financial system is build and has grown over a long period. We all LIKE that current system. I like to be able to go to my bank and show my passport and get my money. I like to know that untaxed money is harder to hide. I like the knowlwedge that you can't transfer high amount of money from left to right without an external party looking over it for money laundring. Those systems are beneficial for every normal human being. Don't throw in garbage statements like "old man yells at cloud". Either argue or don't.
- hparadiz 5y ago
  None of this matters. The system is unblock able and your opinion doesn't matter. It will go on without me or you. That is how it is. You can complain all you want.
  - 5y ago