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I suspect this isn't a good-faith question, but I'll attempt an answer at least: Bitcoin's game theory creates a system for agreeing on a worldwide price for e

I suspect this isn't a good-faith question, but I'll attempt an answer at least: Bitcoin's game theory creates a system for agreeing on a worldwide price for energy in a way that self-regulates, as opposed to relying on people like OPEC to price-fix the energy market. It works by effectively selecting a random power plant on the planet, every 10 minutes, and kinda asking them to vote on how best to use their energy. Either they're mining Bitcoin and might be the lucky winner, or they're instead selling that energy locally for some more productive purpose. This forms a comparison function, like in a quicksort. Each power plant is voting with their wallet as to whether their local energy price is more important than the global one. As a results it's as-if you've created a kind of futures market for energy prices that requires no centralized governing body. The net effect is that the price of energy is shifted back and forward, like a tug-of-war. The final result is somewhat akin to an iterative solver. The entire world energy economy is now being controlled by an algorithm, something that's never been attempted before like this. It's been running 13 years now, and gains more weight as the value being thrown around increases. The energy market is tumbling wildly around right now as most people (a) have no idea any of this is happening, and (b) can't really stop it. In the end the ultimate goal is settling on a solution where all parties in the game achieve consensus on the true price of assets, something that humanity has never had before in its history. The idea of energy=money is an important development that, while people today seem to refuse to try and get their heads around, will ultimately change the world.

vba616 5y ago
>The idea of energy=money is an important development that, while people today seem to refuse to try and get their heads around, will ultimately change the world. If you really believe this, it would help if you could spare the time to refute people, like me, who currently believe it's a huge step backwards, even more than that, a kind of self-sustaining cancer, the vanguard of the "grey goo scenario" people talk about. The Landauer limit is supposed to be a lower bound on the energy that has to be dissipated to flip a single bit. It's something like 1e-26 watt hours. That (minus a few powers of 10) what you fundamentally have to use to write down a number that you call money, whether it's $1 or $1 trillion. It's not an easy thing to ensure that writing those numbers down is regulated, but it's clearly doable and in no way requires overhead on the order of the money supply. With Bitcoin, though, creating $1 trillion will always cost $1 trillion even in the far future where we perhaps run computers at the Landauer limit or harness entire galaxies for power. If a galaxy costs $1 trillion, then you have to destroy a galaxy to represent the abstract value of the other one. It appears, to me, to be a recreation of the disadvantages of mining precious metal for money, in such a way as to potentially consume the entire universe (insofar as humans ever get access to it). The more advanced energy production is, the more will be consumed to make the same amount of money. This is not just bad, it's existentially horrifying (for some people) and it's more disturbing to see advocates of PoW ignore this. Because, what is it that you're thinking? Something being an algorithm doesn't mean it's a good algorithm. Even if there is a clever argument for why it's good in some abstract sense. See: https://en.wikipedia.org/wiki/Galactic_algorithm https://en.wikipedia.org/wiki/Galactic_algorithm There's a passage in a book by Douglas Adams that I'm reminded of, even though it isn't quite the same: "“How can you have money,” demanded Ford, “if none of you actually produces anything? It doesn't grow on trees you know.” “If you would allow me to continue.. .” Ford nodded dejectedly. “Thank you. Since we decided a few weeks ago to adopt the leaf as legal tender, we have, of course, all become immensely rich.” Ford stared in disbelief at the crowd who were murmuring appreciatively at this and greedily fingering the wads of leaves with which their track suits were stuffed. “But we have also,” continued the management consultant, “run into a small inflation problem on account of the high level of leaf availability, which means that, I gather, the current going rate has something like three deciduous forests buying one ship’s peanut." Murmurs of alarm came from the crowd. The management consultant waved them down. “So in order to obviate this problem,” he continued, “and effectively revalue the leaf, we are about to embark on a massive defoliation campaign, and. . .er, burn down all the forests. I think you'll all agree that's a sensible move under the circumstances." The crowd seemed a little uncertain about this for a second or two until someone pointed out how much this would increase the value of the leaves in their pockets whereupon they let out whoops of delight and gave the management consultant a standing ovation. The accountants among them looked forward to a profitable autumn aloft and it got an appreciative round from the crowd.”" You might say "oh, this is a story of fiat currency" and perhaps it was intended that way, as the story predated cryptocurrency. But the "burn the forests down" is what strikes a chord with me.
- imtringued 5y ago
  Isn't it a story of gold and maybe even oil? After all, people did fight wars over those. By that I mean territory that bears oil and gold.
  - kayamon 5y ago
    Indeed. By allowing the price of energy to settle very quickly online, Bitcoin ultimately makes it hard for world governments to keep accumulating debt to fund their wars in foreign countries. As long as the price of assets can be settled truthfully online faster than the liars can spread their propaganda, the system should work. As long as honest nodes control the CPU power, the economy remains provably secure. Just to be clear, because it seems some people still don't have any idea this stuff: Bitcoin invented a viral, self-healing economy. It's an algorithm to replace capitalism with a new economy against its will. It's possibly one of the cleverest things since the Manhattan Project. It just really annoys me that everyone on HN seems to think it's designed for trading pogs or something.
imtringued 5y ago
I will admit that energy is not a terrible "commodity" to base an economy around but I don't see how Bitcoin is supposed to guarantee that a single bitcoin equals wasting a certain amount of energy. It fails as a unit of account for energy.
- kayamon 5y ago
  It takes electricity to make one bitcoin. You can't lie about that -- if someone gives you a bitcoin, it means provably someone somewhere on the planet took some time to bottle some energy up to make that bitcoin.

vba616 5y ago

>The idea of energy=money is an important development that, while people today seem to refuse to try and get their heads around, will ultimately change the world. If you really believe this, it would help if you could spare the time to refute people, like me, who currently believe it's a huge step backwards, even more than that, a kind of self-sustaining cancer, the vanguard of the "grey goo scenario" people talk about. The Landauer limit is supposed to be a lower bound on the energy that has to be dissipated to flip a single bit. It's something like 1e-26 watt hours. That (minus a few powers of 10) what you fundamentally have to use to write down a number that you call money, whether it's $1 or $1 trillion. It's not an easy thing to ensure that writing those numbers down is regulated, but it's clearly doable and in no way requires overhead on the order of the money supply. With Bitcoin, though, creating $1 trillion will always cost $1 trillion even in the far future where we perhaps run computers at the Landauer limit or harness entire galaxies for power. If a galaxy costs $1 trillion, then you have to destroy a galaxy to represent the abstract value of the other one. It appears, to me, to be a recreation of the disadvantages of mining precious metal for money, in such a way as to potentially consume the entire universe (insofar as humans ever get access to it). The more advanced energy production is, the more will be consumed to make the same amount of money. This is not just bad, it's existentially horrifying (for some people) and it's more disturbing to see advocates of PoW ignore this. Because, what is it that you're thinking? Something being an algorithm doesn't mean it's a good algorithm. Even if there is a clever argument for why it's good in some abstract sense. See: https://en.wikipedia.org/wiki/Galactic_algorithm https://en.wikipedia.org/wiki/Galactic_algorithm There's a passage in a book by Douglas Adams that I'm reminded of, even though it isn't quite the same: "“How can you have money,” demanded Ford, “if none of you actually produces anything? It doesn't grow on trees you know.” “If you would allow me to continue.. .” Ford nodded dejectedly. “Thank you. Since we decided a few weeks ago to adopt the leaf as legal tender, we have, of course, all become immensely rich.” Ford stared in disbelief at the crowd who were murmuring appreciatively at this and greedily fingering the wads of leaves with which their track suits were stuffed. “But we have also,” continued the management consultant, “run into a small inflation problem on account of the high level of leaf availability, which means that, I gather, the current going rate has something like three deciduous forests buying one ship’s peanut." Murmurs of alarm came from the crowd. The management consultant waved them down. “So in order to obviate this problem,” he continued, “and effectively revalue the leaf, we are about to embark on a massive defoliation campaign, and. . .er, burn down all the forests. I think you'll all agree that's a sensible move under the circumstances." The crowd seemed a little uncertain about this for a second or two until someone pointed out how much this would increase the value of the leaves in their pockets whereupon they let out whoops of delight and gave the management consultant a standing ovation. The accountants among them looked forward to a profitable autumn aloft and it got an appreciative round from the crowd.”" You might say "oh, this is a story of fiat currency" and perhaps it was intended that way, as the story predated cryptocurrency. But the "burn the forests down" is what strikes a chord with me.

imtringued 5y ago
Isn't it a story of gold and maybe even oil? After all, people did fight wars over those. By that I mean territory that bears oil and gold.
- kayamon 5y ago
  Indeed. By allowing the price of energy to settle very quickly online, Bitcoin ultimately makes it hard for world governments to keep accumulating debt to fund their wars in foreign countries. As long as the price of assets can be settled truthfully online faster than the liars can spread their propaganda, the system should work. As long as honest nodes control the CPU power, the economy remains provably secure. Just to be clear, because it seems some people still don't have any idea this stuff: Bitcoin invented a viral, self-healing economy. It's an algorithm to replace capitalism with a new economy against its will. It's possibly one of the cleverest things since the Manhattan Project. It just really annoys me that everyone on HN seems to think it's designed for trading pogs or something.

imtringued 5y ago

I will admit that energy is not a terrible "commodity" to base an economy around but I don't see how Bitcoin is supposed to guarantee that a single bitcoin equals wasting a certain amount of energy. It fails as a unit of account for energy.

kayamon 5y ago
It takes electricity to make one bitcoin. You can't lie about that -- if someone gives you a bitcoin, it means provably someone somewhere on the planet took some time to bottle some energy up to make that bitcoin.