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I think this is a problem until it isn't. The first country that starts pricing its oil exports in bitcoin will a) cause the price to initially skyrocket, and

I think this is a problem until it isn't. The first country that starts pricing its oil exports in bitcoin will a) cause the price to initially skyrocket, and b) create a stabilizing force on the price that percolates to all other goods and services. And the interesting thing, is that because bitcoin is energy money, there is a very direct and explicit correlation to the amount of bitcoin you can earn from using your energy to mine, which can then allow an exporter to trivially calculate the price they are willing to sell their energy for (slightly more than they can net from mining). The dollar is the stable global reserve currency largely because the US has used its military might to violently coerce oil exporters to price their oil in dollars. Once that happens peacefully with bitcoin, the US dollar will regress back to a local currency used to control its own population and bitcoin will be the fair, global reserve asset used for international trade.

verdverm 5y ago
How does China largely banning crypto, promoting its own currency (particularly in trying to get it used as the oil pricing from Saudi Arabia), and being one of the biggest importers... play into this hypothetical future?
- anonporridge 5y ago
  a) China's new digital yuan isn't a novel competitor to bitcoin. It's just the same old fiat in a new, more authoritarian enabling form. b) China, while increasingly powerful, is not the whole world. If the rest of the world decides that bitcoin is the only viable fair global reserve currency that doesn't disproportionately benefit some global empire, then they'll eventually be forced to come along for the ride, and will be hurt from their decision to take themselves out of the game in the early days.
  - verdverm 5y ago
    Bitcoin is too volatile, when will it become stable enough to be used for pricing IRL goods?
    - anonporridge 5y ago
      Did you not read my GP comment?
      - verdverm 5y ago
        Yes, the logic doesn't add up, it's a chicken egg problem. It has to be stable before it's used for pricing any serious amount of IRL goods. Given how it's usage has evolved, I don't see a path to a stable Bitcoin.
        anonporridge 5y ago
        It will likely be the same kind of path civilization had to using gold and silver as its primary currency for thousands of years. If it happened for those metals, why do you think it's so unbelievable that it can happen for a superior form of digital gold?
        dmitriid 5y ago
        > the same kind of path civilization had to using gold and silver as its primary currency for thousands of years. Until we came up with better ways to provide payment for goods and services.
NhanH 5y ago
Bitcoin mining is not elastic enough to do what you propose (also, what a terrifying thought), for the fact that a) you needs mining equipment, which becomes obsolete in relatively short amount of time and b) electricity transfer is not free, so large scale centralized bitcoin mining will require additional power generation facility Your description of the petrodollar is borderline conspiratorial as well. And even within your reasoning, the US Navy will beat ASIC mining machines 100% of the time. How could it happen "peacefully" ?
- anonporridge 5y ago
  > you needs mining equipment, which becomes obsolete in relatively short amount of time This is only because mining ASICs have rapidly developed towards state of the art chip fabrication, making each generation a huge jump in hashes per watt efficiency. Now that state of the art mining chips are 5nm, the regular obsoleting of old chips is likely to drastically slow down and you'll be able to make profit from old machines for a much longer time if you treat them well. > electricity transfer is not free, so large scale centralized bitcoin mining will require additional power generation facility This is a very odd statement. One of the magical things about bitcoin mining as an electricity consumer is that it is one of the most modular and delocalized customers of electricity ever created in human civilization. You can drop small pods of miners right next to every electricity producer on the planet with a satellite connection. Some miners are deploying these small units to oil extractors to use their flared natural gas, which then allows oil producers to a) generate income on wasted gas when it's not economical to transport via pipes or liquefied natural gas and b) burn the nat gas more efficiently than flaring, which reduces global methane emissions (a GHG 100x more potent than CO2 that eventually degrades in to long lasting CO2). Moreover, bitcoin miners will soon be deployed to new electricity producers to help them start generating money before transmission lines and grid capacity are funded and built out. I and many others think this is why bitcoin will soon become the tip of the spear in accelerating energy buildout. > the US Navy will beat ASIC mining machines 100% of the time. How could it happen "peacefully" The US military is not obviously an enemy of bitcoin, and may actually turn into a strong supporter. https://www.businessinsider.com/bitcoin-btc-national-security-thesis-superpower-defense-strategy-jason-lowery-2022-3 https://www.businessinsider.com/bitcoin-btc-national-securit... archive link, https://archive.ph/wfesI https://archive.ph/wfesI https://twitter.com/JasonPLowery/status/1491826850569637889 https://twitter.com/JasonPLowery/status/1491826850569637889
JumpCrisscross 5y ago
> because bitcoin is energy money This is mostly nonsense. Energy provides a consistent price floor for mining Bitcoin. That has little relevance to its traded price. If energy prices triple, that doesn't mean Bitcoin prices have to triple as well. It just makes mining at lower prices unprofitable. If nobody wants to buy Bitcoins at the breakeven price, mining just stops--it doesn't magic demand into existence.
- anonporridge 5y ago
  Mining energy use and the price of bitcoin are co-integrated. They play off each other. An increase in price incentivizes more mining and more mining increases the security of the system, which incentivizes more money to flow into and stay in bitcoin. Also, as miners become a larger industrial complex and tightly coupled to electricity producers, they become a tightly integrated piece of civilization that has funds local tax revenues, is the most ideal customer for electricity producers, gives people income, and has its own lobbying groups that push for positive policy change for the system. And in the future flipped world I'm talking about, where in order to buy energy you need to have bitcoin, there is no "buying" bitcoin. Bitcoin is the primary money that you need to have to buy energy. And if you don't have it, then energy producers use their energy to mine it. At that point, it ceases to be a speculative asset and becomes the key unit of account for civilization that doesn't depend on the enforcement of the monopoly on violence.
  - JumpCrisscross 5y ago
    > where in order to buy energy you need to have bitcoin, there is no "buying" bitcoin So when you say "bitcoin is energy money," that's a tautology. It's energy money if oil is priced in bitcoin. > that doesn't depend on the enforcement of the monopoly on violence Violence relieves someone of their Bitcoin keys just as easily as it does their dollars or gold. (At the very least, you can permanently sequester them.)
    - anonporridge 5y ago
      > Violence relieves someone of their Bitcoin keys just as easily as it does their dollars or gold. Wrong. It is significantly more complicated to use violence to steal bitcoin from people than it is to use violence to steal dollars or gold. With bitcoin, I need to coerce you to give it to me. That could mean torture, sure, but do exist multisig key structures that make it impossible to steal bitcoin by coercing a single person. On the other hand, if I want your gold, I just shoot you in the head and spend however long it takes to rummage through you house to find where you stashed it. I don't need to coerce your mind to give it to me. This might seem like a small difference, but it's a hugely important one. It completely changes the economic calculation for the use of violence. Violence is a risky endeavor for any perpetrator and only continues if the economic rewards of engaging in violence outweigh the risks. Bitcoin increases the cost, which necessarily should decrease the incidence.
lottin 5y ago
> bitcoin is energy money Bitcoin isn't energy anything. The energy required to print bitcoins has been expended in the process of printing the bitcoins.
- anonporridge 5y ago
  No. The energy is expended to create the strongest immutability guarantee and DDOS resistance of any distributed system ever created by humanity. Distribution of new coins and transactions fees are simply the reward for that service.
  - lottin 5y ago
    > The energy is expended It certainly is.
    - anonporridge 5y ago
      Yep. Just like the energy used to pump my heart and charge my brain is expended. Everything worth doing costs energy.
      - verdverm 5y ago
        It takes energy to do things, not all of those things are worth doing
        anonporridge 5y ago
        True, and I and millions of others have decided that bitcoin mining is worth doing. Who are you to tell us it's not? Are you going to kill us to stop us from using energy in this way? When you start talking about policing how people use energy, you start down a very dark path.
- bb88 5y ago
  Right, value has been removed from BTC and sent to the energy companies mostly.

verdverm 5y ago

How does China largely banning crypto, promoting its own currency (particularly in trying to get it used as the oil pricing from Saudi Arabia), and being one of the biggest importers... play into this hypothetical future?

anonporridge 5y ago
a) China's new digital yuan isn't a novel competitor to bitcoin. It's just the same old fiat in a new, more authoritarian enabling form. b) China, while increasingly powerful, is not the whole world. If the rest of the world decides that bitcoin is the only viable fair global reserve currency that doesn't disproportionately benefit some global empire, then they'll eventually be forced to come along for the ride, and will be hurt from their decision to take themselves out of the game in the early days.
- verdverm 5y ago
  Bitcoin is too volatile, when will it become stable enough to be used for pricing IRL goods?
  - anonporridge 5y ago
    Did you not read my GP comment?
    - verdverm 5y ago
      Yes, the logic doesn't add up, it's a chicken egg problem. It has to be stable before it's used for pricing any serious amount of IRL goods. Given how it's usage has evolved, I don't see a path to a stable Bitcoin.
      - anonporridge 5y ago
        It will likely be the same kind of path civilization had to using gold and silver as its primary currency for thousands of years. If it happened for those metals, why do you think it's so unbelievable that it can happen for a superior form of digital gold?
        dmitriid 5y ago
        > the same kind of path civilization had to using gold and silver as its primary currency for thousands of years. Until we came up with better ways to provide payment for goods and services.

NhanH 5y ago

Bitcoin mining is not elastic enough to do what you propose (also, what a terrifying thought), for the fact that a) you needs mining equipment, which becomes obsolete in relatively short amount of time and b) electricity transfer is not free, so large scale centralized bitcoin mining will require additional power generation facility Your description of the petrodollar is borderline conspiratorial as well. And even within your reasoning, the US Navy will beat ASIC mining machines 100% of the time. How could it happen "peacefully" ?

anonporridge 5y ago
> you needs mining equipment, which becomes obsolete in relatively short amount of time This is only because mining ASICs have rapidly developed towards state of the art chip fabrication, making each generation a huge jump in hashes per watt efficiency. Now that state of the art mining chips are 5nm, the regular obsoleting of old chips is likely to drastically slow down and you'll be able to make profit from old machines for a much longer time if you treat them well. > electricity transfer is not free, so large scale centralized bitcoin mining will require additional power generation facility This is a very odd statement. One of the magical things about bitcoin mining as an electricity consumer is that it is one of the most modular and delocalized customers of electricity ever created in human civilization. You can drop small pods of miners right next to every electricity producer on the planet with a satellite connection. Some miners are deploying these small units to oil extractors to use their flared natural gas, which then allows oil producers to a) generate income on wasted gas when it's not economical to transport via pipes or liquefied natural gas and b) burn the nat gas more efficiently than flaring, which reduces global methane emissions (a GHG 100x more potent than CO2 that eventually degrades in to long lasting CO2). Moreover, bitcoin miners will soon be deployed to new electricity producers to help them start generating money before transmission lines and grid capacity are funded and built out. I and many others think this is why bitcoin will soon become the tip of the spear in accelerating energy buildout. > the US Navy will beat ASIC mining machines 100% of the time. How could it happen "peacefully" The US military is not obviously an enemy of bitcoin, and may actually turn into a strong supporter. https://www.businessinsider.com/bitcoin-btc-national-security-thesis-superpower-defense-strategy-jason-lowery-2022-3 https://www.businessinsider.com/bitcoin-btc-national-securit... archive link, https://archive.ph/wfesI https://archive.ph/wfesI https://twitter.com/JasonPLowery/status/1491826850569637889 https://twitter.com/JasonPLowery/status/1491826850569637889

JumpCrisscross 5y ago

> because bitcoin is energy money This is mostly nonsense. Energy provides a consistent price floor for mining Bitcoin. That has little relevance to its traded price. If energy prices triple, that doesn't mean Bitcoin prices have to triple as well. It just makes mining at lower prices unprofitable. If nobody wants to buy Bitcoins at the breakeven price, mining just stops--it doesn't magic demand into existence.

anonporridge 5y ago
Mining energy use and the price of bitcoin are co-integrated. They play off each other. An increase in price incentivizes more mining and more mining increases the security of the system, which incentivizes more money to flow into and stay in bitcoin. Also, as miners become a larger industrial complex and tightly coupled to electricity producers, they become a tightly integrated piece of civilization that has funds local tax revenues, is the most ideal customer for electricity producers, gives people income, and has its own lobbying groups that push for positive policy change for the system. And in the future flipped world I'm talking about, where in order to buy energy you need to have bitcoin, there is no "buying" bitcoin. Bitcoin is the primary money that you need to have to buy energy. And if you don't have it, then energy producers use their energy to mine it. At that point, it ceases to be a speculative asset and becomes the key unit of account for civilization that doesn't depend on the enforcement of the monopoly on violence.
- JumpCrisscross 5y ago
  > where in order to buy energy you need to have bitcoin, there is no "buying" bitcoin So when you say "bitcoin is energy money," that's a tautology. It's energy money if oil is priced in bitcoin. > that doesn't depend on the enforcement of the monopoly on violence Violence relieves someone of their Bitcoin keys just as easily as it does their dollars or gold. (At the very least, you can permanently sequester them.)
  - anonporridge 5y ago
    > Violence relieves someone of their Bitcoin keys just as easily as it does their dollars or gold. Wrong. It is significantly more complicated to use violence to steal bitcoin from people than it is to use violence to steal dollars or gold. With bitcoin, I need to coerce you to give it to me. That could mean torture, sure, but do exist multisig key structures that make it impossible to steal bitcoin by coercing a single person. On the other hand, if I want your gold, I just shoot you in the head and spend however long it takes to rummage through you house to find where you stashed it. I don't need to coerce your mind to give it to me. This might seem like a small difference, but it's a hugely important one. It completely changes the economic calculation for the use of violence. Violence is a risky endeavor for any perpetrator and only continues if the economic rewards of engaging in violence outweigh the risks. Bitcoin increases the cost, which necessarily should decrease the incidence.

lottin 5y ago

> bitcoin is energy money Bitcoin isn't energy anything. The energy required to print bitcoins has been expended in the process of printing the bitcoins.

anonporridge 5y ago
No. The energy is expended to create the strongest immutability guarantee and DDOS resistance of any distributed system ever created by humanity. Distribution of new coins and transactions fees are simply the reward for that service.
- lottin 5y ago
  > The energy is expended It certainly is.
  - anonporridge 5y ago
    Yep. Just like the energy used to pump my heart and charge my brain is expended. Everything worth doing costs energy.
    - verdverm 5y ago
      It takes energy to do things, not all of those things are worth doing
      - anonporridge 5y ago
        True, and I and millions of others have decided that bitcoin mining is worth doing. Who are you to tell us it's not? Are you going to kill us to stop us from using energy in this way? When you start talking about policing how people use energy, you start down a very dark path.
bb88 5y ago
Right, value has been removed from BTC and sent to the energy companies mostly.