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Well, not exactly. There is the utility of enabling the chain. And there is nothing stopping us from extracting gold using electricity. It's in basically all s
by enchiridion 5y ago
Well, not exactly. There is the utility of enabling the chain.
And there is nothing stopping us from extracting gold using electricity. It's in basically all soil and sea water. Sure there are some required materials, but I'd water a guess that those materials are no harder to obtain than GPUs.
The only thing that stops this reckless mining are the forces of the market, and the same is true with crypto. Crypto miners tend to be extremely frugal, and I doubt any are any who are doing unprofitable mining in expectation of crypto going up.
Now from a crypto maximalist perspective, which I don't necessarily hold, isn't the cost of the electricity worth having a decentralized currency which enables all sort of different markets?
Crypto is always held up as wasteful in terms of energy, but I'd be curious to see the energy cost in comparison to current payment processing systems.
- kemotep 5y agoIf anyone is interested, Visa reports that their payments network (and supporting infrastructure) uses 740,000 Gigajoules[0] in a year. Can’t quite find a one for one measurement for Bitcoin, but due note this is the energy needs of all of Visa’s operations and they process in excess 100 billion transactions a year and Bitcoin (in 2020) averaged around 300,000 transactions a day[1]. If interested there is this[2] digiconomist article with more numbers (no clue as to the veracity of them). [0]: https://usa.visa.com/dam/VCOM/download/corporate-responsibility/visa-2019-corporate-responsibility-report.pdf https://usa.visa.com/dam/VCOM/download/corporate-responsibil.... [1]: https://www.blockchain.com/charts/n-transactions https://www.blockchain.com/charts/n-transactions [2]: https://digiconomist.net/bitcoin-energy-consumption/ https://digiconomist.net/bitcoin-energy-consumption/
- enchiridion 5y agoSo let's do the rough math and figure out the comparison 300k per day is around 100 million transactions per year, three orders of magnitude less than Visa. BTC uses 110 terawatt hours per year right now[0], which is 396,000,000 gigajoules, a three order of magnitude difference in the other direction. Assuming everything scales nicely, if Bitcoin were the size of visa it would use ~6 orders of magnitude more energy. OK, so that is way worse than I thought. I'm still not sold on the idea that it's a bad thing, but it's nice to put numbers to the situation. [0] https://www.google.com/amp/s/hbr.org/amp/2021/05/how-much-energy-does-bitcoin-actually-consume https://www.google.com/amp/s/hbr.org/amp/2021/05/how-much-en...