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Shouldn’t free market take care of this? If electricity prices go to $0.2/kWh you’re losing money when mining and you turn of your ASICs.

cableshaft 4y ago
The free market is waiting until there's only a few puddles of freshwater left and charging a million dollars a sip, as the Colorado River is proving[1] (or overfished waters, or all sorts of things). It's terrible at being proactive, it only benefits a company for exploiting a resource until it's gone, and ratcheting up the price until it is[2]. [1]: https://utahrivers.org/blog-post/2021/12/13/new-report-upper-basin-states-overusing-colorado-river-water https://utahrivers.org/blog-post/2021/12/13/new-report-upper... [2]: https://www.forbes.com/sites/drewhansen/2016/02/09/unless-it-changes-capitalism-will-starve-humanity-by-2050/ https://www.forbes.com/sites/drewhansen/2016/02/09/unless-it...
- highwaylights 4y ago
  The free market as a religion is a phenomenon that’s pretty unique to the US, though starting to metastasise around the world too. American polarism (e.g. if you suggest there’s a single negative consequence to capitalism you’re automatically a communist) is spreading at the same time. I think we should all be concerned about the consequences.
- someguydave 4y ago
  California environmentalist activists on the Costal Commission refuse to allow desalinization which is what is truly threatening the Colorado river.
- radford-neal 4y ago
  "The free market is ... terrible at being proactive, it only benefits a company for exploiting a resource until it's gone ..." To the extent that this happens, it's not unique to a free market economy. The Soviet Union was notable for causing environmental devastation. Theoretically, if real interest rates are sufficiently high, it might be profitable to, for example, over-fish some species to extinction, since the present value of future catches declines exponentially with time, according to the interest rate. However, for the past few decades, real interest rates have been at historically low levels, so it's hard to see this as an explanation for any current short-sighted behaviour.
ben_w 4y ago
The interaction between the real money cost to mine, the BTC-denominated reward from mining, the market price of a bitcoin in real money, and the effect on the bitcoin network hash rate from all of those things changing, and the speculation about what they may do in the future, and the irrationality of the markets, makes it kinda hard to predict.
bob1029 4y ago
It would, but no one pays the real cost of electricity. Some people used to be able to in Texas but they banned that shit really fast once it became obvious that the average asshole can’t cope with real-time wholesale pricing volatility. $9/KWh adds up fast. If everyone had to suffer that same system, it’s possible we wouldn’t have had a winter crisis in 2021.
- Scipio_Afri 4y ago
  How would this have forced utility companies to spend money to invest in winterization of natural gas lines, generators and other parts of the power infrastructure? Wouldn’t they just keep the additional profit for themselves, like they did with the previous profits they had, and the crisis still would’ve happened because natural gas pipes would freeze and the air would be too cold to be used in the compressor stage of the generator without prior heating… More money to the utility company does not exert a pressure for them to spend money for robustness and especially rare events.
  - bob1029 4y ago
    The point is that if your demand-side of the market is actually sensitized to real-time availability concerns, you would see a much better outcome in constrained generation scenarios. Certainly, additional incentives should be considered to encourage more robust maintenance schedules around generation-side as well. I am absolutely for multiple options here. I don't think this is a situation where one simple decision solves all of the problems all at once.
- dannyw 4y ago
  I used to pay for wholesale rates in Australia with a startup that was passing through wholesale rates with no mark-up (instead, they charge a monthly service fee). Switched away after $20/kWh days that wiped off a year of savings from no markip.
jjulius 4y ago
Yes, we've all seen how well the free market has handled things before.
rvense 4y ago
Yes, regulating Bitcoin directly would be bad. The much better solution is to make it more expensive for everyone else who has no interest in it to cook their food. That's obviously the correct way to deal with this.
CJefferson 4y ago
The problem, with limited electricity supplies, is the amount people will pay to mine bitcoins may be more than the amount available pay to heat people's homes, or power hospitals. Increasing the cost wouldn't fix that problem.
MeltingAaah 4y ago
Free market: tabacco lobby. That was not a good thing for us. Watch a documentary on how they created false research on purpose and lied in public. You don't want a free market.
chrisan 4y ago
Isn't that the same thing as asking all environmental policies to be removed? Let companies do whatever they want, people will decide winners and losers with their wallets. Something tells me the general public will go for the cheapest/most profitable company and only a minority will try to do "the right thing".

cableshaft 4y ago

The free market is waiting until there's only a few puddles of freshwater left and charging a million dollars a sip, as the Colorado River is proving[1] (or overfished waters, or all sorts of things). It's terrible at being proactive, it only benefits a company for exploiting a resource until it's gone, and ratcheting up the price until it is[2]. [1]: https://utahrivers.org/blog-post/2021/12/13/new-report-upper-basin-states-overusing-colorado-river-water https://utahrivers.org/blog-post/2021/12/13/new-report-upper... [2]: https://www.forbes.com/sites/drewhansen/2016/02/09/unless-it-changes-capitalism-will-starve-humanity-by-2050/ https://www.forbes.com/sites/drewhansen/2016/02/09/unless-it...

highwaylights 4y ago
The free market as a religion is a phenomenon that’s pretty unique to the US, though starting to metastasise around the world too. American polarism (e.g. if you suggest there’s a single negative consequence to capitalism you’re automatically a communist) is spreading at the same time. I think we should all be concerned about the consequences.
someguydave 4y ago
California environmentalist activists on the Costal Commission refuse to allow desalinization which is what is truly threatening the Colorado river.
radford-neal 4y ago
"The free market is ... terrible at being proactive, it only benefits a company for exploiting a resource until it's gone ..." To the extent that this happens, it's not unique to a free market economy. The Soviet Union was notable for causing environmental devastation. Theoretically, if real interest rates are sufficiently high, it might be profitable to, for example, over-fish some species to extinction, since the present value of future catches declines exponentially with time, according to the interest rate. However, for the past few decades, real interest rates have been at historically low levels, so it's hard to see this as an explanation for any current short-sighted behaviour.

ben_w 4y ago

The interaction between the real money cost to mine, the BTC-denominated reward from mining, the market price of a bitcoin in real money, and the effect on the bitcoin network hash rate from all of those things changing, and the speculation about what they may do in the future, and the irrationality of the markets, makes it kinda hard to predict.

bob1029 4y ago

It would, but no one pays the real cost of electricity. Some people used to be able to in Texas but they banned that shit really fast once it became obvious that the average asshole can’t cope with real-time wholesale pricing volatility. $9/KWh adds up fast. If everyone had to suffer that same system, it’s possible we wouldn’t have had a winter crisis in 2021.

Scipio_Afri 4y ago
How would this have forced utility companies to spend money to invest in winterization of natural gas lines, generators and other parts of the power infrastructure? Wouldn’t they just keep the additional profit for themselves, like they did with the previous profits they had, and the crisis still would’ve happened because natural gas pipes would freeze and the air would be too cold to be used in the compressor stage of the generator without prior heating… More money to the utility company does not exert a pressure for them to spend money for robustness and especially rare events.
- bob1029 4y ago
  The point is that if your demand-side of the market is actually sensitized to real-time availability concerns, you would see a much better outcome in constrained generation scenarios. Certainly, additional incentives should be considered to encourage more robust maintenance schedules around generation-side as well. I am absolutely for multiple options here. I don't think this is a situation where one simple decision solves all of the problems all at once.
dannyw 4y ago
I used to pay for wholesale rates in Australia with a startup that was passing through wholesale rates with no mark-up (instead, they charge a monthly service fee). Switched away after $20/kWh days that wiped off a year of savings from no markip.

jjulius 4y ago

Yes, we've all seen how well the free market has handled things before.

rvense 4y ago

Yes, regulating Bitcoin directly would be bad. The much better solution is to make it more expensive for everyone else who has no interest in it to cook their food. That's obviously the correct way to deal with this.

CJefferson 4y ago

The problem, with limited electricity supplies, is the amount people will pay to mine bitcoins may be more than the amount available pay to heat people's homes, or power hospitals. Increasing the cost wouldn't fix that problem.

MeltingAaah 4y ago

Free market: tabacco lobby. That was not a good thing for us. Watch a documentary on how they created false research on purpose and lied in public. You don't want a free market.

chrisan 4y ago

Isn't that the same thing as asking all environmental policies to be removed? Let companies do whatever they want, people will decide winners and losers with their wallets. Something tells me the general public will go for the cheapest/most profitable company and only a minority will try to do "the right thing".