7 ms·

Am I missing the sarcasm here?

by zwirbl 5y ago

mytailorisrich 5y ago
In Iran, gasoline and electricity are sold for next to nothing (electricity might even be free for businesses, not sure). This sort of market distortion has real effects. Obviously if electricity is very cheap to essentially free it makes crypto-mining very attractive (on top of the attractiveness of a 'currency' outside of the banking system in a country under international sanctions) and shortages worse.
- zwirbl 5y ago
  This being about government subsidizing energy actually makes a lot of sense, I would not have gotten to this interpretation from the comment itself
- dilyevsky 5y ago
  Iran (also under sanctions) and Kazakhstan having relatively ineffective economies simply can’t sustain paying us/european energy prices. The idea that this unintended arbitrage is somehow subsidies fault is just ludicrous to me. Their only fault is they didn’t stamp out those assholes quickly enough
  - ahtihn 5y ago
    How come the government can afford to subsidize energy if the economy can't sustain paying the "true" price for it? Where is the money coming from?
    - dilyevsky 5y ago
      Oil is where it’s coming from. Yeah you can sell as much as you can with export prices but you’ll gut your economy in the process
    - cool_dude85 5y ago
      The problem with things like energy that are almost a necessity for modern life is that some individuals cannot afford it, not that "the economy" taken as a whole cannot. Let's say 5% of Iran's GDP is spent on energy. Not sure what the number is, but whatever. A big chunk but affordable for the economy as a whole. At the market price, maybe 10% of people cannot afford to consume enough energy to meet the necessities of modern life - cooking, not freezing to death, using transportation. If you don't want these 10% of people to be shut off from modern society, you need to subsidize somehow.
      - conanbatt 5y ago
        It would be better to give the money to the people and they can choose to spend it on electricity or something else. Subsidizing electricity is a distortion.
        caf 5y ago
        Isn't that just going to bid up the prices for everything else? Historically, subsidising electricity has worked fairly efficiently, because it wasn't possible to effectively store and re-sell or export it.
        conanbatt 5y ago
        1. No 2. It has always worked the same: people arbitrage the subsidy by doing energy inefficient labor. Bitcoin mining is just a more efficient arbitrage mechanism.
    - ohgodplsno 5y ago
      You're the guy that doesn't get invited to parties because you keep eating all the food because it's free, aren't you ? All those subsidies are given under the expectation that people will behave reasonably and only use what is necessary, because it gets the country running. It's taking a hit so that your citizens can live and thrive. When you suddenly have a bunch of people running thousands of GPU for magic internet money, that is not a reasonable use of it.
      - ahtihn 5y ago
        Why so personal and agressive? In my opinion it would be better to have normal energy prices and simply redistribute the money. At least it would give an incentive to use energy more efficiently
  - turminal 5y ago
    Iran happens to sit on enormous amounts of oil. Energy being cheap there is hardly a surprise.
    - groundhogday3 5y ago
      They can drill it but they can't refine a lot of it because of sanctions. https://www.iranintl.com/en/20211025679868 https://www.iranintl.com/en/20211025679868
  - mytailorisrich 5y ago
    Yes, by country under sanctions I meant Iran. You don't make your economy more effective by having incentives to remain ineffective. This sort of arbitrage (crypto-mining) is a direct consequence of misguided subsidies: If electricity is essentially free you have no incentive to control your electricity consumption and that attracts heavy users, which pushes consumption up in a vicious circle and can lead to shortages. Iran has oil so they can probably afford to keep energy prices very low but that does not help them over the long term. A ban on crypto-mining is also very difficult to enforce, IMHO.
- shagie 5y ago
  > electricity might even be free for businesses From https://www.elliptic.co/blog/how-iran-uses-bitcoin-mining-to-evade-sanctions https://www.elliptic.co/blog/how-iran-uses-bitcoin-mining-to... > In 2019 Iran officially recognised cryptoasset mining, later establishing a licensing regime that required miners to identify themselves, pay a higher (but still very low) tariff for electricity, and to sell their mined bitcoins to Iran’s central bank. Thousands of unlicensed mining farms have subsequently been identified and shut down - including in mosques, which receive free electricity. So, not quite free - but rather low still. How low is in https://www.globalpetrolprices.com/Iran/electricity_prices/ https://www.globalpetrolprices.com/Iran/electricity_prices/ Iran is 0.004 USD/kWh for households with no info for business costs (though its still likely rather low as Iran is the 2nd lowest cost for energy on that list). For comparison, USA is 0.153 USD/kWH. The sanctions aspect make this part of the why crypto currency is appealing. They are essentially burning oil they can't sell on the market into electricity for Bitcoin which is hard to sanction. > The electricity being used by miners in Iran would require the equivalent of approximately 10 million barrels of crude oil each year to generate - around 4% of total Iranian oil exports in 2020.

Am I missing the sarcasm here?

by zwirbl 5y ago

Am I missing the sarcasm here?

In Iran, gasoline and electricity are sold for next to nothing (electricity might even be free for businesses, not sure). This sort of market distortion has real effects. Obviously if electricity is very cheap to essentially free it makes crypto-mining very attractive (on top of the attractiveness of a 'currency' outside of the banking system in a country under international sanctions) and shortages worse.

zwirbl 5y ago
This being about government subsidizing energy actually makes a lot of sense, I would not have gotten to this interpretation from the comment itself
dilyevsky 5y ago
Iran (also under sanctions) and Kazakhstan having relatively ineffective economies simply can’t sustain paying us/european energy prices. The idea that this unintended arbitrage is somehow subsidies fault is just ludicrous to me. Their only fault is they didn’t stamp out those assholes quickly enough
- ahtihn 5y ago
  How come the government can afford to subsidize energy if the economy can't sustain paying the "true" price for it? Where is the money coming from?
  - dilyevsky 5y ago
    Oil is where it’s coming from. Yeah you can sell as much as you can with export prices but you’ll gut your economy in the process
  - cool_dude85 5y ago
    The problem with things like energy that are almost a necessity for modern life is that some individuals cannot afford it, not that "the economy" taken as a whole cannot. Let's say 5% of Iran's GDP is spent on energy. Not sure what the number is, but whatever. A big chunk but affordable for the economy as a whole. At the market price, maybe 10% of people cannot afford to consume enough energy to meet the necessities of modern life - cooking, not freezing to death, using transportation. If you don't want these 10% of people to be shut off from modern society, you need to subsidize somehow.
    - conanbatt 5y ago
      It would be better to give the money to the people and they can choose to spend it on electricity or something else. Subsidizing electricity is a distortion.
      - caf 5y ago
        Isn't that just going to bid up the prices for everything else? Historically, subsidising electricity has worked fairly efficiently, because it wasn't possible to effectively store and re-sell or export it.
        conanbatt 5y ago
        1. No 2. It has always worked the same: people arbitrage the subsidy by doing energy inefficient labor. Bitcoin mining is just a more efficient arbitrage mechanism.
  - ohgodplsno 5y ago
    You're the guy that doesn't get invited to parties because you keep eating all the food because it's free, aren't you ? All those subsidies are given under the expectation that people will behave reasonably and only use what is necessary, because it gets the country running. It's taking a hit so that your citizens can live and thrive. When you suddenly have a bunch of people running thousands of GPU for magic internet money, that is not a reasonable use of it.
    - ahtihn 5y ago
      Why so personal and agressive? In my opinion it would be better to have normal energy prices and simply redistribute the money. At least it would give an incentive to use energy more efficiently
- turminal 5y ago
  Iran happens to sit on enormous amounts of oil. Energy being cheap there is hardly a surprise.
  - groundhogday3 5y ago
    They can drill it but they can't refine a lot of it because of sanctions. https://www.iranintl.com/en/20211025679868 https://www.iranintl.com/en/20211025679868
- mytailorisrich 5y ago
  Yes, by country under sanctions I meant Iran. You don't make your economy more effective by having incentives to remain ineffective. This sort of arbitrage (crypto-mining) is a direct consequence of misguided subsidies: If electricity is essentially free you have no incentive to control your electricity consumption and that attracts heavy users, which pushes consumption up in a vicious circle and can lead to shortages. Iran has oil so they can probably afford to keep energy prices very low but that does not help them over the long term. A ban on crypto-mining is also very difficult to enforce, IMHO.
shagie 5y ago
> electricity might even be free for businesses From https://www.elliptic.co/blog/how-iran-uses-bitcoin-mining-to-evade-sanctions https://www.elliptic.co/blog/how-iran-uses-bitcoin-mining-to... > In 2019 Iran officially recognised cryptoasset mining, later establishing a licensing regime that required miners to identify themselves, pay a higher (but still very low) tariff for electricity, and to sell their mined bitcoins to Iran’s central bank. Thousands of unlicensed mining farms have subsequently been identified and shut down - including in mosques, which receive free electricity. So, not quite free - but rather low still. How low is in https://www.globalpetrolprices.com/Iran/electricity_prices/ https://www.globalpetrolprices.com/Iran/electricity_prices/ Iran is 0.004 USD/kWh for households with no info for business costs (though its still likely rather low as Iran is the 2nd lowest cost for energy on that list). For comparison, USA is 0.153 USD/kWH. The sanctions aspect make this part of the why crypto currency is appealing. They are essentially burning oil they can't sell on the market into electricity for Bitcoin which is hard to sanction. > The electricity being used by miners in Iran would require the equivalent of approximately 10 million barrels of crude oil each year to generate - around 4% of total Iranian oil exports in 2020.